# EDGAR Filing Document

**Accession Number:** 0002123613
**File Stem:** 0001193125-26-126541
**Filing Date:** 2026-3
**Character Count:** 2557283
**Document Hash:** 25b0bf0d34acfabae4d3fccb7279af9d
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-26-126541.hdr.sgml**: 20260526

**ACCESSION NUMBER**: 0001193125-26-126541

**CONFORMED SUBMISSION TYPE**: DRS

**PUBLIC DOCUMENT COUNT**: 38

**FILED AS OF DATE**: 20260326

**DATE AS OF CHANGE**: 20260327

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Kardigan, Inc.
- **CENTRAL INDEX KEY:** 0002123613
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 932994203
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** DRS
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 377-09175
- **FILM NUMBER:** 26799159

**BUSINESS ADDRESS:**
- **STREET 1:** C/O KARDIGAN, INC.
- **STREET 2:** 131 OYSTER POINT BLVD., SECOND FLOOR
- **CITY:** SOUTH SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94080
- **BUSINESS PHONE:** (415) 573-3220

**MAIL ADDRESS:**
- **STREET 1:** C/O KARDIGAN, INC.
- **STREET 2:** 131 OYSTER POINT BLVD., SECOND FLOOR
- **CITY:** SOUTH SAN FRANCISCO
- **STATE:** CA
- **ZIP:** 94080

##### [**Table of Contents**](#toc)
**As confidentially submitted to the Securities and Exchange Commission on March 26, 2026. This draft registration statement has not been publicly filed with the Securities and Exchange Commission and all information herein remains strictly confidential.** 

**Registration No. 333-** 

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**WASHINGTON, D.C. 20549** 

**FORM S-1**

**REGISTRATION STATEMENT** 

***UNDER***

***THE SECURITIES ACT OF 1933***

## Kardigan, Inc.
**(Exact name of registrant as specified in its charter)** 

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| | | |
|:---|:---|:---|
| **Delaware** | **2834** | **93-2994203** |
| **(State or other jurisdiction of**<br> **incorporation or organization)** | **(Primary Standard Industrial**<br> **Classification Code Number)** | **(I.R.S. Employer**<br> **Identification Number)** |

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**Kardigan, Inc.** 

**131 Oyster Point Blvd., Second Floor** 

**South San Francisco, CA 94080** 

**(415) 573-3220** 

**(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)** 

**Tassos Gianakakos** 

**Chief Executive Officer** 

**131 Oyster Point Blvd., Second Floor** 

**South San Francisco, CA 94080** 

**(415) 573-3220** 

**(Name, address, including zip code, and telephone number, including area code, of agent for service)** 

***Copies to:***

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| | |
|:---|:---|
| **Mitchell S. Bloom**<br> **Benjamin K. Marsh**<br> **Goodwin Procter LLP**<br> **100 Northern Avenue**<br> **Boston, MA 02210**<br> **(617) 570-1000** | **Peter N. Handrinos**<br> **Elisabeth M. Martin**<br> **Latham & Watkins LLP**<br> **200 Clarendon Street**<br> **Boston, MA 02116**<br> **(617) 880-4500** |

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**Approximate date of commencement of proposed sale to the public:** As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, check the following box: ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
|  |  | Emerging growth company | ☒ |

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

**The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.** 

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##### [**Table of Contents**](#toc)
**The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted.** 

**Subject to Completion, Dated , 2026** 

**PRELIMINARY PROSPECTUS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***shares***

![LOGO](g107928g00v01.jpg)

***Common stock***

This is an initial public offering of shares of common stock of Kardigan, Inc. We are offering shares of our common stock.

Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share will be between $ and $. We intend to apply to list our common stock on the under the symbol "KARD." We believe that upon the completion of this offering, we will meet the standards for listing on the , and the completion of this offering is contingent upon such listing.

We are an "emerging growth company" and "smaller reporting company" as defined under the U.S. federal securities laws and, as such, we have elected to comply with certain reduced public company reporting requirements in this prospectus.

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| | | |
|:---|:---|:---|
| | **Per share** | **Total** |
|  Initial public offering price | $| $|
|  Underwriting discounts and commissions(1) | $| $|
|  Proceeds, before expenses, to Kardigan, Inc. | $| $|

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(1) See the section titled "*Underwriting*" for additional information regarding compensation payable to the underwriters.

We have granted the underwriters the option for a period of 30 days to purchase up to an additional shares of common stock from us, at the initial public offering price, less the underwriting discounts and commissions.

**Investing in our common stock involves a high degree of risk. See the section titled "*[Risk Factors](#toc107928_4)*" beginning on page 11 to read about factors you should carefully consider before deciding to invest in shares of our common stock.** 

**Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.** 

The underwriters expect to deliver the shares against payment on or about , 2026.

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| | | | |
|:---|:---|:---|:---|
| **J.P. Morgan** | **Jefferies** | **Leerink Partners** | **TD Cowen** |

---

**Prospectus dated , 2026** 

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##### [**Table of Contents**](#toc)
**Table of contents** 

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| | |
|:---|:---|
|  | **Page** |
|  [Prospectus summary](#toc107928_1) | 1 |
|  [The offering](#toc107928_2) | 7 |
|  [Summary consolidated financial data](#toc107928_3) | 9 |
|  [Risk factors](#toc107928_4) | 11 |
|  [Special note regarding forward-looking statements](#toc107928_5) | 104 |
|  [Use of proceeds](#toc107928_6) | 106 |
|  [Dividend policy](#toc107928_7) | 108 |
|  [Capitalization](#toc107928_8) | 109 |
|  [Dilution](#toc107928_9) | 111 |
|  [Management's discussion and analysis of financial condition and results of operations](#toc107928_10) | 114 |
|  [Business](#toc107928_11) | 134 |
|  [Management](#toc107928_12) | 215 |
|  [Executive compensation](#toc107928_13) | 225 |
|  [Director compensation](#toc107928_14) | 237 |
|  [Certain relationships and related person transactions](#toc107928_15) | 239 |
|  [Principal stockholders](#toc107928_16) | 245 |
|  [Description of capital stock](#toc107928_17) | 246 |
|  [Shares eligible for future sale](#toc107928_18) | 252 |
|  [Material U.S. federal income tax consequences for non-U.S. holders](#toc107928_19) | 254 |
|  [Underwriting](#toc107928_20) | 259 |
|  [Legal matters](#toc107928_21) | 271 |
|  [Experts](#toc107928_22) | 271 |
|  [Where you can find additional information](#toc107928_23) | 271 |
|  [Index to the consolidated financial statements](#toc107928_24) | F-1 |

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**Through and including , 2026 (the 25th day after the date of this prospectus), all dealers effecting transactions in our common stock, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to a dealer's obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.** 

Neither we nor the underwriters have authorized anyone to provide you any information or make any representations other than those contained in this prospectus or in any free writing prospectuses prepared by or on behalf of us or to which we have referred you. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We and the underwriters are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or in any applicable free writing prospectus is current only as of its date, regardless of its time of delivery or any sale of shares of our common stock. Our business, financial condition, results of operations and prospects may have changed since that date.

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##### [**Table of Contents**](#toc)
For investors outside of the United States: we have not, and the underwriters have not, done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of our common stock and the distribution of this prospectus outside of the United States.

**Basis of presentation** 

Except where the context otherwise requires or where otherwise indicated, the terms "Kardigan," "we," "us," "our," "our company," "Company" and "our business" refer to Kardigan, Inc. and its wholly owned subsidiaries, Rancho Santa Fe Bio, Inc. and Prolaio, Inc.

The consolidated financial statements include the accounts of Kardigan, Inc. and its wholly owned subsidiaries, Rancho Santa Fe Bio, Inc. and Prolaio, Inc., which were acquired in June 2024 and February 2025, respectively. Our financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). Our fiscal year ends on December 31 of each year. References to 2025 and 2024 refer to the year ended December 31, 2025 and December 31, 2024, respectively.

Certain monetary amounts, percentages and other figures included in this prospectus have been subject to rounding adjustments. Percentage amounts included in this prospectus have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this prospectus may vary from those obtained by performing the same calculations using the figures in our consolidated financial statements included elsewhere in this prospectus. Certain other amounts that appear in this prospectus may not sum due to rounding.

**Trademark and tradenames** 

We own, have applied for or have rights to use one or more registered and common law trademarks, service marks and/or trade names in connection with our business in the United States, which may be used throughout this prospectus. This prospectus also includes trademarks, tradenames, and service marks of third-parties which are the property of their respective owners. Our use or display of third-parties' trademarks, service marks, tradenames or products in this prospectus and our other public filings is not intended to, and does not imply a relationship with, or endorsement or sponsorship by us. Solely for convenience, the trademarks, service marks, logos and trade names referred to in this prospectus and our other public filings may appear without the <sup>®</sup>, TM or SM symbols, but the omission of such references is not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable owner of or licensor to these trademarks, service marks and trade names.

**Market, industry and other data** 

The market data and certain other statistical information used throughout this prospectus are based on independent industry publications, governmental publications, reports by market research firms, or other independent sources that we believe to be reliable sources. Industry publications and third-party research, surveys, and studies generally indicate that their information has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. We are responsible for all of the disclosures contained in this prospectus, and we believe that these sources are reliable; however, we have not independently verified the information contained in such publications. While we are not aware of any misstatements regarding any third-party information presented in this prospectus, their estimates, in particular, as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties, and are subject to change based on various factors, including those discussed under the section titled "*Risk Factors*" and elsewhere in this prospectus. Some data are also based on our good faith estimates.

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##### [**Table of Contents**](#toc)
**Prospectus summary** 

*This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, including the sections of this prospectus titled "Risk Factors," "Special Note Regarding Forward-Looking Statements," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes included elsewhere in this prospectus, before making an investment decision.* 

**Overview** 

Kardigan is a clinical-stage precision therapeutics company developing medicines that target the root cause of specific cardiovascular diseases where no approved treatments exist. Our mission is to develop multiple targeted cardiovascular treatments in parallel that bring people with cardiovascular diseases closer to the cures they deserve. We leverage deep domain expertise in cardiovascular biology, real-world patient data, and advanced analytics to accelerate drug discovery and development, aiming to deliver impactful therapies efficiently and at scale.

Our management team includes leaders from MyoKardia, Inc. ("MyoKardia") with a proven track record in cardiovascular drug development, including the successful development and approval of mavacamten for hypertrophic cardiomyopathy. We utilize an optimized clinical development framework, enhanced by our proprietary Prolaio data and analytics technology, to drive efficient execution and accelerated proof-of-concept trial timelines.

Cardiovascular disease is the leading cause of death worldwide, yet innovation has lagged due to drug development focused on broad, downstream, symptom-focused approaches despite disease heterogeneity and genetic variability, resulting in incremental advances and lengthy clinical trials. Kardigan is committed to overcoming these challenges by advancing precision medicines that target the fundamental drivers of cardiovascular conditions, aiming to deliver meaningful improvements in patient outcomes.

**Our pipeline** 

We are advancing three late-stage cardiovascular therapies, each representing a first-in-indication opportunity:

• **Danicamtiv**. An investigational oral cardiac atrial and ventricular myosin activator for the treatment of genetic
dilated cardiomyopathy ("DCM") caused by pathogenic variants in MYH7 and TTN. Danicamtiv is designed to restore myosin function and availability, directly targeting the underlying sarcomeric defects in DCM. It has been evaluated in 10
completed clinical studies and is currently being studied in our KINSHIP-DCM Phase 2b/3 adaptive, randomized, placebo-controlled trial.

• **Ataciguat**. An investigational oral, once-daily soluble guanylate cyclase ("sGC") activator aimed at
slowing the progression of calcific aortic valve stenosis ("CAVS") in patients with moderate disease. Ataciguat targets valvular interstitial cells to slow osteogenic and calcific remodeling, the underlying driver of disease progression
in CAVS. It is currently being evaluated in our KATALYST-AV Phase 2b/3 clinical trial.

• **Tonlamarsen**. An investigational liver-directed antisense oligonucleotide ("ASO") administered
once-monthly via subcutaneous injection, targeting hepatic angiotensinogen ("AGT") for the management of blood pressure in acute severe hypertension ("ASH") post-hospitalization. Tonlamarsen is supported by robust clinical
data and is being evaluated in our KARDINAL-ASH Phase 2 trial.

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##### [**Table of Contents**](#toc)
*Our Clinical Pipeline*![LOGO](g107928g11m01.jpg)

**Our Prolaio platform** 

The Prolaio platform is Kardigan's proprietary, FDA-cleared data and analytics system that enables continuous, real-world physiologic data collection across all clinical trials. By integrating wearable sensors and AI-driven analytics, Prolaio delivers high-frequency, objective patient data to optimize trial design, accelerate development, and support digital clinical endpoints. This technology enhances trial efficiency, patient engagement, and the precision of therapeutic insights.

*Prolaio's Benefits Today:* 

• Longitudinal data collection.

• Real-world data at scale.

• Near real-time visibility.

• Reduced patient burden.

• Rapid, personalized signal detection for faster decisions.

*Future Prolaio Benefits in Development:* 

• Digital clinical endpoints.

• Decentralized trials.

• Increased statistical power for smaller clinical trials.

• Increased probability of success.

**Our approach** 

Kardigan's approach is built on four pillars:

• **Target well-defined patient populations**. We develop therapies designed for biologically defined subgroups, moving
beyond one-size-fits-all cardiovascular care.

• **Target the root cause**. We focus on the causal biological drivers to enable disease modification, based on deep
mechanistic understanding.

• **Harness technology**. We leverage continuous real-world data, AI analytics and FDA-cleared algorithms to increase
power, speed, and insight.

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• **Develop differently**. We use data-driven and insight-rich strategies and seek to gain early regulatory alignment for
novel functional and real-world endpoints.

Our proprietary Prolaio platform enables continuous, real-world physiologic data collection and analysis, supporting trial efficiency, patient engagement, and the development of digital clinical endpoints.

**Our management team** 

Kardigan's management team is led by industry veterans with a proven track record in cardiovascular drug discovery, development, and company building, including the co-founders and senior leaders of MyoKardia.

• **Tassos Gianakakos, Co-Founder, President and Chief Executive Officer.** Over
20 years of biopharma leadership, former CEO of MyoKardia, and co-founder of Prolaio, with extensive experience in building and scaling innovative biotechnology companies.

• **Jay Edelberg, M.D., Ph.D., Co-Founder and Chief Medical Officer.** Clinical
cardiologist and vascular biologist with more than two decades of experience in cardiovascular clinical research and drug development, including senior roles at MyoKardia, Sanofi, Bristol-Myers Squibb Company, and GlaxoSmithKline, and is also co-founder of Prolaio.

Our team's expertise spans clinical research, translational science, and the successful advancement of multiple late-stage programs, supported by leading life sciences investors including ARCH Venture Partners, HRTG Partners, Perceptive Advisors, T. Rowe Price, and Fidelity Management & Research.

**Risks associated with our business** 

Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks include, but are not limited to, the following:

• We are a clinical-stage biopharmaceutical company with a limited operating history, which may make it difficult to evaluate
our current business and predict our future success and viability. We have incurred significant financial losses since our inception and anticipate that we will continue to incur significant financial losses for the foreseeable future.

• Even if this offering is successful, we will require additional funding in order to finance operations. If we are unable to
raise capital when needed, or on acceptable terms, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts.

• Our business is highly dependent on the success of our product candidates, particularly Danicamtiv for genetic DCM,
Ataciguat for moderate CAVS, and Tonlamarsen for post-hospitalization management of ASH. If we are unable to successfully complete clinical development, obtain regulatory approval for or commercialize one or more of our product candidates, or if we
experience delays in doing so, our business will be materially harmed.

• The successful development of pharmaceutical products involves a lengthy and expensive process and is highly uncertain.

• We may experience challenges with the acquisition, development, enhancement or deployment of technology necessary for our
Prolaio platform.

• The regulatory approval processes of the FDA, EMA, and other comparable regulatory authorities are lengthy, time-consuming
and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed.

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##### [**Table of Contents**](#toc)
• We are dependent on third parties having accurately generated, collected, interpreted and reported data from certain
preclinical studies and clinical trials that were previously conducted for our product candidates.

• Our use of the Prolaio platform to enhance clinical trial design and execution is a novel approach that may not result in
the anticipated efficiencies or regulatory acceptance, which exposes us to unforeseen risks and makes it difficult for us to predict the time and cost of product development.

• If our clinical trials fail to replicate positive results from earlier preclinical studies or clinical trials conducted by
us or third parties, we may be unable to successfully develop, obtain regulatory approval for or commercialize our product candidates.

• We have concentrated our research and development efforts on the treatment of cardiovascular diseases, a field that faces
certain challenges in drug development.

• The number of patients with certain cardiovascular diseases for which we are developing our product candidates has not been
established with precision. If the actual number of patients with the diseases we elect to pursue with our product candidates is smaller than we anticipate, we may have difficulties in enrolling patients in our clinical trials, which may delay or
prevent development of our product candidates. Even if such product candidates are successfully developed and approved, the markets for our product candidates may be smaller than we expect and our revenue potential and ability to achieve
profitability may be materially adversely affected.

• We rely on third parties to assist in conducting our clinical trials. If they do not perform satisfactorily, we may not be
able to obtain regulatory approval or commercialize our product candidates, or such approval or commercialization may be delayed, and our business could be substantially harmed.

• If we fail to comply with our obligations in the agreements under which we license intellectual property rights from third
parties or otherwise experience disruptions to our business relationships with our licensors, or if any of our material license agreements are terminated, we could lose our rights to key intellectual property and components enabling our
technologies.

• Our success depends upon our ability to obtain and protect our intellectual property and proprietary information. If we or
our licensors are unable to obtain, maintain, defend and enforce patent or other intellectual property protection for any of our current or future product candidates or platform technologies, or if the scope of the patent or other intellectual
property protection obtained is not sufficiently broad or enforceable, third parties could develop and commercialize products and technology similar or identical to ours, and our ability to successfully commercialize any of our current or future
product candidates and platform technologies may be adversely affected.

• Our management and our independent registered public accounting firm have concluded that there is substantial doubt as to
our ability to continue as a going concern. If we cannot continue as a going concern, our stockholders may lose some or all of their investment in our company.

• There has been no prior public market for our common stock, and an active trading market may not develop or be sustained.

The summary risk factors described above should be read together with the text of the full risk factors in the section titled "*Risk Factors*" and the other information set forth in this prospectus, including our consolidated financial statements and the related notes, as well as in other documents that we file with the Securities and Exchange Commission ("SEC"). The risks summarized above or described in full elsewhere in this prospectus are

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not the only risks that we face. Additional risks and uncertainties not presently known to us, or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, results of operations, and future growth prospects.

**Corporate information** 

We were incorporated under the laws of the State of Delaware in August 2023 under the name EnCarda, Inc., and changed our name to Kardigan, Inc. in December 2024. Our principal executive offices are located at 131 Oyster Point Blvd., Second Floor, South San Francisco, CA 94080, and our telephone number is (415) 573-3220. We have two subsidiaries, Rancho Santa Fe Bio, Inc., formed in October 2019 under the laws of the State of Delaware, and Prolaio, Inc., formed in November 2021 under the laws of the State of Delaware. Our website address is *www.kardigan.bio*. The information contained in or accessible from our website is not incorporated into this prospectus, and you should not consider it part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.

**Implications of being an emerging growth company and a smaller reporting company** 

We qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, as amended ("JOBS Act"). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include:

• being permitted to present only two years of audited financial statements, in addition to any required unaudited interim
financial statements, with correspondingly reduced "Management's Discussion and Analysis of Financial Condition and Results of Operations" disclosure in this prospectus;

• reduced disclosure about our executive compensation arrangements;

• not being required to hold advisory votes on executive compensation or to obtain stockholder approval of any golden
parachute arrangements not previously approved;

• an exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting
pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"); and

• an exemption from compliance with the requirements of the Public Company Accounting Oversight Board regarding the
communication of critical audit matters in the auditor's report on the financial statements.

We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company on the date that is the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of this offering; (iii) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC. We may choose to take advantage of some but not all of these exemptions. We have taken advantage of reduced reporting requirements in this prospectus. Accordingly, the information contained herein may be different from the information you receive from other public companies in which you hold stock. Additionally, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this exemption and, therefore, while we are an emerging growth company we will

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not be subject to new or revised accounting standards at the same time that they become applicable to other public companies that are not emerging growth companies. As a result of this election, our financial statements may not be comparable to those of other public companies that comply with new or revised accounting pronouncements as of public company effective dates. We have in the past chosen and may in the future choose to early adopt any new or revised accounting standards whenever such early adoption is permitted for private companies.

We are also a "smaller reporting company," meaning that the market value of our shares held by non-affiliates plus the proposed aggregate amount of gross proceeds to us as a result of this offering is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company after this offering if either (i) the market value of our shares held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our shares held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation.

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##### [**Table of Contents**](#toc)
**The offering** 

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| **Common stock offered by us**  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares. |

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|:---|:---|
| **Option to purchase additional shares of common stock offered by us**  | We have granted the underwriters an option for a period of 30 days from the date of this prospectus to purchase up to additional shares of common stock from us at the public offering price, less underwriting discounts and commissions, on the same terms as set forth in this prospectus. |

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|:---|:---|
| **Common stock to be outstanding immediately after this offering**  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;shares (or shares if the underwriters exercise their option to purchase additional shares of common stock in full). |

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|:---|:---|
| **Use of proceeds**  | We estimate that the net proceeds from the sale of our common stock in this offering will be approximately $ million (or approximately $ million if the underwriters exercise their option to purchase additional shares of common stock in full), based on the assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. |

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We currently intend to use the net proceeds we receive from this offering, together with our existing cash, cash equivalents and short-term investments to fund the clinical development of Danicamtiv, Ataciguat and Tonlamarsen, to fund other research and development activities, and the remainder for working capital and other general corporate purposes. See the section titled "*Use of Proceeds*" for additional information.

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| | |
|:---|:---|
| **Risk factors**  | Investing in our common stock involves a high degree of risk. See the section titled "*Risk Factors*" for a discussion of factors you should carefully consider before deciding whether to invest in our common stock. |

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| | |
|:---|:---|
| **Proposed trading symbol on**  | "KARD" |

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Unless otherwise noted, the number of shares of our common stock that will be outstanding after this offering is based on 40,253,113 shares of common stock (which includes 625,000 shares of unvested restricted common stock and 736,481 shares of common stock issued upon early exercise of stock options that remain subject to repurchase) outstanding as of December 31, 2025, after giving effect to the automatic conversion of all outstanding shares of our redeemable convertible preferred stock into an aggregate of 29,987,476 shares of common stock upon the completion of this offering, and excludes:

• 8,177,647 shares of common stock issuable upon exercise of outstanding stock options as of December 31, 2025 under our
2023 Stock Option and Grant Plan, as amended ("2023 Plan"), with a weighted average exercise price of $4.36 per share;

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• 2,059,429 shares of common stock issuable upon exercise of outstanding stock options granted after December 31, 2025,
through March 18, 2026 pursuant to our 2023 Plan, with a weighted average exercise price of $9.23 per share;

• 2,747,295 shares of common stock reserved for future issuance as of December 31, 2025 under the 2023 Plan, which will
cease to be available for issuance at the time that our 2026 Stock Option and Incentive Plan ("2026 Plan") becomes effective;

• 1,100,000 shares of common stock issuable upon the exercise of warrants outstanding as of December 31, 2025, with an
exercise price of $21.37 per share;

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of our common stock reserved for future issuance under our 2026 Plan, which will become
effective on the date immediately prior to the effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common stock reserved for future issuance under the 2026
Plan and any shares underlying outstanding stock awards granted under the 2023 Plan that expire or are repurchased, forfeited, cancelled, or withheld; and

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of common stock reserved for future issuance under our 2026 Employee Stock Purchase Plan
("ESPP"), which will become effective on the date immediately prior to the date of effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common
stock reserved for future issuance under the ESPP.

Unless otherwise indicated, the information in this prospectus reflects or assumes the following:

• a 1-for-    reverse stock split of our common stock, which
will become effective prior to the completion of this offering;

• the automatic conversion of all outstanding shares of our redeemable convertible preferred stock outstanding an aggregate
of 29,987,476 shares of common stock upon the completion of this offering;

• no exercise of the outstanding stock options or warrants described above;

• no exercise of the underwriters' option to purchase up to an additional shares of common stock in this offering; and

• the filing and effectiveness of our third amended and restated certificate of incorporation upon the completion of this
offering and the adoption of our amended and restated bylaws to be in effect upon the effectiveness of the registration statement of which this prospectus forms a part.

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**Summary consolidated financial data** 

*The following tables set forth our summary consolidated statements of operations for the years ended December 31, 2025 and 2024 and our summary consolidated balance sheet data as of December 31, 2025. We have derived the summary consolidated statements of operations data for the years ended December 31, 2025 and 2024, and the summary consolidated balance sheet data as of December 31, 2025, from our audited consolidated financial statements included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected for any period in the future. You should read the following summary financial data together with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes included elsewhere in this prospectus. The summary consolidated financial data included in this section are not intended to replace the consolidated financial statements and are qualified in their entirety by our consolidated financial statements and the related notes included elsewhere in this prospectus.* 

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| | | |
|:---|:---|:---|
| | **Year ended December 31,** | **Year ended December 31,** |
| <br>**(in thousands, except share and per share data)** | **2025** | **2024** |
|  Consolidated Statements of Operations Data: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Research and development | $153086 | $84294 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 48750 | 12362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 201836 | 96656 |
|  Loss from operations | (201836) | (96656) |
|  Other income (expense): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest income | 6850 | 1293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of preferred stock tranche obligations | 1100 | 6751 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Bargain purchase gain | 5232 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Warrant issuance expense | (7358) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other expense, net | (441) | (46) |
|  Loss before income taxes | (196453) | (88658) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income tax benefit | 4512 |  |
|  Net loss | $(191941) | $(88658) |
|  Net loss per share attributable to common stockholders, basic and diluted(1) | $(23.63) | $(14.00) |
|  Weighted average common shares outstanding used in calculating net loss per share attributable to common stockholders, basic and diluted(1) | 8122117 | 6332771 |
|  Pro forma net loss per share attributable to common stockholders, basic and diluted (unaudited)(2) |  |  |
|  Pro forma weighted-average common shares outstanding, basic and diluted (unaudited)(2) |  |  |

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(1) See Note 2 and Note 13 to our audited consolidated financial statements included elsewhere in this prospectus for details on the calculation of basic and diluted net loss per share attributable to common stockholders.

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(2) Pro forma basic and diluted net loss per share attributable to common stockholders has been prepared to give effect to adjustments to our capital structure arising in connection with the completion of this offering and
is calculated by dividing the pro forma net loss attributable to common stockholders by the pro forma weighted-average common shares outstanding for the period. Pro forma weighted-average common shares outstanding is computed by adjusting the
weighted-average common shares outstanding to give pro forma effect to the automatic conversion of all shares of our redeemable convertible preferred stock outstanding as of December 31, 2025 into shares of common stock as if such conversion
had occurred on January 1, 2025. Pro forma basic and diluted net loss per share attributable to common stockholders does not include the effect of the shares expected to be sold in this offering.

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| | | | |
|:---|:---|:---|:---|
| | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** |
| <br>**(in thousands)** | **Actual** | **Pro<br>forma(1)** | **Pro forma<br>as adjusted(2)** |
|  **Consolidated Balance Sheet Data** |  |  |  |
|  Cash and cash equivalents | $108989 |  |  |
|  Short-term investments | 226496 |  |  |
|  Working capital(3) | 307817 |  |  |
|  Total assets | 390942 |  |  |
|  Total liabilities | 55127 |  |  |
|  Redeemable convertible preferred stock | 586150 |  |  |
|  Total stockholders' deficit | (250335) |  |  |

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(1) The pro forma consolidated balance sheet data gives effect to (i) the automatic conversion of all outstanding shares of our redeemable convertible preferred stock into an aggregate of 29,987,476 shares of our
common stock upon the completion of this offering and (ii) the filing and effectiveness of our third amended and restated certificate of incorporation, which will occur upon the completion of this offering.

(2) The pro forma as adjusted consolidated balance sheet data gives effect to (i) the pro forma adjustments set forth in footnote (1) above and (ii) the issuance and sale of     shares
of our common stock in this offering at an assumed initial public offering price of $**  per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting
discounts and commissions and estimated offering expenses payable by us. Pro forma as adjusted balance sheet data is illustrative only and will change based on the actual initial public offering price and other terms of this offering determined at
pricing. Each $1.00 increase (decrease) in the assumed initial public offering price of $**  per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) the
pro forma as adjusted amount of each of cash, cash equivalents and short-term investments, working capital, total assets and total stockholders' deficit by approximately $** , assuming that the number of shares
offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Each 1,000,000 increase (decrease) in the number of shares
offered by us, as set forth on the cover page of this prospectus, would increase or decrease the pro forma as adjusted amount of each of cash, cash equivalents and short-term investments, working capital, total assets and total stockholders'
deficit by approximately $**  million, assuming no change in the assumed initial offering price per share, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

(3) We define working capital as current assets less current liabilities. See our audited consolidated financial statements and related notes appearing elsewhere in this prospectus for further details regarding our current
assets and current liabilities.

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**Risk factors** 

*Investing in our common stock involves a high degree of risk. You should consider and read carefully all of the risks and uncertainties described below, as well as the other information in this prospectus, including our consolidated financial statements and the related notes appearing elsewhere in this prospectus and "Management's Discussion and Analysis of Financial Condition and Results of Operations" before deciding whether to invest in our common stock. The risks described below are not the only ones facing us. The following risks or additional risks and uncertainties not presently known to us or that we currently believe to be immaterial could materially and adversely affect our business, financial condition, results of operations and growth prospects. In such an event, the trading price of our common stock could decline, and you may lose all or part of your investment.* 

*This prospectus also contains forward-looking statements and estimates that involve risks and uncertainties. Our actual results could differ materially from those anticipated in our forward-looking statements as a result of specific factors, including the risks and uncertainties described below.* 

**Risks related to our limited operating history, financial condition and need for additional capital** 

***We are a clinical-stage biopharmaceutical company with a limited operating history, which may make it difficult to evaluate our current business and predict our future success and viability. We have incurred significant financial losses since our inception and anticipate that we will continue to incur significant financial losses for the foreseeable future.***

We are a clinical-stage biopharmaceutical company with a limited operating history. We were formed in August 2023 as EnCarda, Inc., and our operations to date have been limited to organizing and staffing our company, business planning, including our acquisitions, raising capital, identifying, licensing and developing potential product candidates, acquiring, deploying and developing our Prolaio platform and technology, securing intellectual property rights, and planning and undertaking preclinical studies and clinical trials. Our lead product candidates include Danicamtiv for genetic dilated cardiomyopathy ("DCM"), Ataciguat for moderate calcific aortic valve stenosis ("CAVS") and Tonlamarsen for post-hospitalization management of acute severe hypertension ("ASH").

We have not yet demonstrated an ability to generate revenues, obtain regulatory approvals, manufacture any product on a commercial scale or arrange for a third party to do so on our behalf or conduct sales and marketing activities necessary for successful product commercialization. Our limited operating history as a company makes any assessment of our future success and viability subject to significant uncertainty. We will encounter risks and difficulties frequently experienced by early-stage biopharmaceutical companies in rapidly evolving fields, and we have not yet demonstrated an ability to successfully overcome such risks and difficulties. If we do not address these risks and difficulties successfully, our business will suffer.

The success of our business depends primarily upon our ability to identify, develop, and commercialize our product candidates, Danicamtiv, Ataciguat and Tonlamarsen and develop our Prolaio platform. We do not know whether we will be able to develop any product candidates that succeed through preclinical and clinical development or products of commercial value. We have no products approved for commercial sale and have not generated any revenue from product sales to date. We will continue to incur significant research and development and other expenses related to our preclinical and clinical development and ongoing operations. As a result, we are not profitable and have incurred losses in each period since our inception. Net losses and negative cash flows have had, and will continue to have, an adverse effect on our stockholders' equity and working capital. Our net losses totaled $191.9 million and $88.7 million for the year ended December 31, 2025

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and 2024, respectively. As of December 31, 2025, we have not yet generated revenues and had an accumulated deficit of $281.1 million. We expect to continue to incur significant losses for the foreseeable future, and we expect these losses to increase as we continue our research and development of, and seek regulatory approvals for, our product candidates.

We anticipate that our expenses will increase substantially if, and as, we:

• advance our product candidates through clinical development, including as we continue to advance Danicamtiv, Ataciguat and
Tonlamarsen in later-stage clinical trials;

• continue to develop our Prolaio platform;

• seek regulatory approvals from the U.S. Food and Drug Administration (the "FDA") or other foreign regulatory
authorities for our product candidates that successfully complete clinical trials;

• hire additional clinical, quality control, medical, scientific and other technical personnel to support the clinical
development of our product candidates;

• experience an increase in headcount as we expand our research and development organization and market development and pre-commercial planning activities;

• undertake any pre-commercial or commercial activities to establish sales, marketing
and distribution capabilities;

• advance our existing and potential future preclinical-stage product candidates into clinical development;

• seek to identify, acquire and develop additional product candidates, including through business development efforts to
invest in or in-license other technologies or product candidates, which may include opportunities to leverage our Prolaio platform;

• maintain, expand and protect our intellectual property portfolio;

• experience heightened regulatory scrutiny;

• make milestone, royalty or other payments due under our existing license agreements with MyoKardia, Inc.
("MyoKardia"), Bristol-Myers Squibb Company ("BMS Co."), Sanofi, Mayo Foundation for Medical Education and Research ("Mayo") and Ionis Pharmaceuticals, Inc. ("Ionis") and our purchase agreements with
Rancho Santa Fe Bio, Inc. ("RSF") and Prolaio, Inc., and any future in-license or collaboration agreements;

• make milestone, royalty, interest or other payments due under any future licensing, financing or other arrangements with
third parties; and

• incur additional legal, accounting, and other expenses associated with operating as a public company.

Biopharmaceutical product development entails substantial upfront capital expenditures and significant risk that any potential product candidate will fail to demonstrate adequate efficacy or an acceptable safety profile, gain regulatory approval, secure market access and reimbursement and become commercially viable, and therefore any investment in us is highly speculative. Accordingly, before making an investment in us, you should consider our prospects, factoring in the costs, uncertainties, delays and difficulties frequently encountered by companies in clinical development, especially clinical-stage biopharmaceutical companies such as ours. Any predictions you make about our future success or viability may not be as accurate as they would otherwise be if we had a longer operating history or a history of successfully developing and commercializing pharmaceutical products. We may encounter unforeseen expenses, difficulties, complications, delays and other known or unknown factors in achieving our business objectives.

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Additionally, our expenses could increase beyond our expectations if we are required by the FDA, European Medicines Agency ("EMA"), or other comparable regulatory authorities to perform clinical trials in addition to those that we currently expect, or if there are any delays in establishing appropriate manufacturing arrangements for or in completing our clinical trials or the development of any of our product candidates.

***Even if this offering is successful, we will require additional funding in order to finance operations. If we are unable to raise capital when needed, or on acceptable terms, we could be forced to delay, reduce or eliminate our product development programs or commercialization efforts.***

Developing biopharmaceutical products, including conducting preclinical studies and clinical trials, is a very time-consuming, expensive and uncertain process that takes years to complete. We expect our expenses to continue to increase in connection with our ongoing activities, particularly as we conduct clinical trials of, and seek regulatory and marketing approval for, our product candidates. Even if our current or future product candidates are approved for commercial sale, we anticipate incurring significant costs associated with commercializing any approved product candidate. To date, we have funded our operations through private financings. We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the clinical and preclinical development of our product candidates, continue to identify new product candidates, develop and deploy our Prolaio platform, commence additional preclinical studies and clinical trials, and continue to identify and develop additional product candidates either through internal development or through acquisitions or in-licensing product candidates.

As of December 31, 2025, we had $335.5 million of cash, cash equivalents and short-term investments. We believe that our existing cash, cash equivalents and short-term investments, together with the net proceeds from our issuance of $10.0 million in Series B redeemable convertible preferred stock in March 2026 and the anticipated net proceeds from this offering, will enable us to fund our operating expenses and capital expenditure requirements through . We have based this estimate on assumptions that may prove to be wrong, and we could utilize our available capital resources sooner than we expect. We may also raise additional financing on an opportunistic basis in the future. For example, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. Attempting to secure additional financing may divert our management from our day-to-day activities, which may adversely affect our ability to develop our product candidates. Our future capital requirements will depend on many factors, including but not limited to:

• the scope, timing, progress, costs and results of discovery, preclinical development and clinical trials for our current or
future product candidates and the effectiveness of our Prolaio platform;

• the number of clinical trials required for regulatory approval of our current or future product candidates;

• the costs, timing and outcome of regulatory review of any of our current or future product candidates;

• the timing and amount of any milestones, royalties or other payments due in connection with our acquisitions and licenses,
as applicable;

• the cost of manufacturing clinical and commercial supplies of our current or future product candidates;

• the costs and timing of preparing, filing and prosecuting patent applications, maintaining and enforcing our intellectual
property rights and defending any intellectual property-related claims, including any claims by third parties that we are infringing upon their intellectual property rights;

• our ability to deploy and develop the Prolaio platform;

• our ability to maintain existing, and establish new, strategic collaborations or other arrangements and the financial terms
of any such agreements, including the timing and amount of any future milestone, royalty or other payments due under any such agreement;

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• the costs and timing of future commercialization activities, including manufacturing, marketing, sales and distribution,
for any of our product candidates for which we receive marketing approval;

• the revenue, if any, received from commercial sales of our product candidates for which we receive marketing approval;

• expenses to attract, hire and retain skilled personnel;

• the costs of operating as a public company;

• our ability to establish a commercially viable pricing structure and obtain approval for coverage and adequate
reimbursement from third-party and government payors;

• the effect of macroeconomic trends, including inflation, tariffs and fluctuating interest rates;

• any potential supply chain interruptions or delays;

• the effect of competing technological and market developments; and

• the extent to which we acquire or invest in additional businesses, products and technologies.

Because of the numerous risks and uncertainties associated with research and development of product candidates, we are unable to predict the timing or amount of our working capital requirements. In addition, if we obtain regulatory approval for our product candidates, we expect to incur significant commercialization expenses related to product manufacturing, marketing, sales and distribution which make it difficult to predict when or if we will be able to achieve or maintain profitability. Furthermore, upon the completion of this offering, we expect to incur additional costs associated with operating as a public company. Accordingly, we will need to obtain substantial additional funding in order to support our continuing operations. Our ability to raise additional funds will depend on financial, economic, political and market conditions and other factors, over which we may have no or limited control. Additional funds may not be available when we need them, on terms that are acceptable to us, or at all. If we fail to obtain necessary capital when needed on acceptable terms, or at all, it could force us to delay, limit, reduce or terminate our product development programs, future commercialization efforts or other operations.

***Our management and our independent registered public accounting firm have concluded that there is substantial doubt as to our ability to continue as a going concern. If we cannot continue as a going concern, our stockholders may lose some or all of their investment in our company.***

Our audited consolidated financial statements, included elsewhere in this prospectus, were prepared assuming that we will continue as a going concern. The going concern basis of presentation assumes that we will continue in operation for the foreseeable future and will be able to realize our assets and satisfy our liabilities in the normal course of business and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classification of liabilities that may result from our inability to continue as a going concern. As of December 31, 2025, we had cash, cash equivalents and short-term investments of $335.5 million. We have incurred operating losses since inception. Our net losses were $191.9 million and $88.7 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $281.1 million. Based on our current capital resources, which consist of cash, cash equivalents and marketable securities on hand at December 31, 2025, we will not have sufficient cash on hand to support current operations for at least twelve months from March 26, 2026, the date of issuance of the financial statements. This condition raises substantial doubt about our ability to continue as a going concern.

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Even after giving effect to this offering, substantial doubt may continue to exist regarding our ability to continue as a going concern. If we cannot continue as a going concern, we may have to liquidate our assets and may receive less than the value at which those assets are carried on our combined financial statements, and it is likely that our stockholders may lose some or all of their investment in us.

***Raising additional capital may cause dilution to our stockholders, restrict our operations or require us to relinquish rights to our product candidates.***

Until such time, if ever, as we can generate substantial product revenue, we expect to finance our operations with our existing cash, cash equivalents and short-term investments, the net proceeds from this offering, any future equity, debt or other financings and upfront and milestone and royalty payments, if any, received under any future licenses or collaborations. If we raise additional capital through the sale of equity or convertible debt securities, or issue any equity or convertible debt securities in connection with a collaboration agreement or other contractual arrangement, your ownership interest will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a holder of our common stock. In addition, the possibility of such issuance may cause the market price of our common stock to decline. Debt financing, if available, may result in increased fixed payment obligations and involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures, declaring dividends or acquiring, selling or licensing intellectual property rights or assets, which could adversely impact our ability to conduct our business.

If we raise additional funds through collaborations, strategic alliances or marketing, distribution or licensing arrangements with third parties, we may have to relinquish valuable rights to our intellectual property, technologies, future revenue streams or product candidates or grant licenses on terms that may not be favorable to us. We could also be required to seek funds through arrangements with collaborators or others at an earlier stage than otherwise would be desirable. Any of these occurrences may have a material adverse effect on our business, operating results and prospects.

We maintain the majority of our cash and cash equivalents in accounts with major U.S. and multi-national financial institutions, and our deposits at certain of these institutions exceed insured limits. Market conditions and changes in financial regulations and policies can impact the viability of these institutions. In the event of failure of any of the financial institutions where we maintain our cash and cash equivalents, there can be no assurance that we would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position. In addition, changes in regulations governing financial institutions are beyond our control and difficult to predict; consequently, the impact of such changes on our business and results of operations is difficult to predict and may have an adverse effect on us.

**Risks related to our business** 

***Our business is highly dependent on the success of our product candidates, particularly Danicamtiv for genetic DCM, Ataciguat for moderate CAVS, and Tonlamarsen for post-hospitalization management of ASH. If we are unable to successfully complete clinical development, obtain regulatory approval for or commercialize one or more of our product candidates, or if we experience delays in doing so, our business will be materially harmed.***

To date, as an organization, we have not completed the development of any product candidates. Our future success and ability to generate revenue from our product candidates is dependent on our ability to successfully develop, obtain regulatory approval for and commercialize one or more of our product candidates. All of our product candidates will require substantial additional investment for clinical development, regulatory review and approval in one or more jurisdictions. If any of our product candidates, particularly Danicamtiv for genetic

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DCM, Ataciguat for moderate CAVS and Tonlamarsen for ASH, encounters safety or efficacy problems, development delays or regulatory issues or other problems, our development plans and business would be materially harmed.

We may not have the financial resources to continue development of our product candidates if we experience any issues that delay or prevent regulatory approval of, or our ability to commercialize, our product candidates, including:

• our inability to demonstrate to the satisfaction of the FDA, EMA, or other comparable regulatory authorities that our
product candidates are safe and effective;

• insufficiency of our financial and other resources to complete the necessary clinical trials and preclinical studies;

• negative or inconclusive results from our clinical trials, preclinical studies or the clinical trials of others for product
candidates similar to ours, leading to a decision or requirement to conduct additional clinical trials or preclinical studies or abandon a program;

• future product-related adverse events ("AEs") experienced by subjects in our clinical trials, including
unexpected toxicity results, or by individuals using drugs or therapeutic biologics similar to our product candidates;

• delays in submitting an Investigational New Drug ("IND") application or other regulatory submission to the FDA,
EMA, or other comparable regulatory authorities, or delays or failure in obtaining the necessary approvals from regulators to commence a clinical trial or a suspension or termination, or hold, of a clinical trial once commenced;

• conditions imposed by the FDA, EMA, or other comparable regulatory authorities regarding the scope or design of our
clinical trials;

• poor effectiveness of our product candidates during clinical trials;

• better than expected performance of control arms, such as placebo groups, which could lead to negative or inconclusive
results from our clinical trials;

• delays in enrolling subjects in our clinical trials;

• high drop-out rates of subjects from our clinical trials;

• inadequate supply or quality of product candidates or other materials necessary for the conduct of our clinical trials;

• higher than anticipated clinical trial or manufacturing costs;

• unfavorable FDA, EMA or comparable regulatory authority inspection and review of our clinical trial sites;

• failure of our third-party contractors or investigators to comply with regulatory requirements or the clinical trial
protocol or otherwise meet their contractual obligations in a timely manner, or at all;

• competition with existing platforms, product candidates or therapies;

• delays and changes in regulatory requirements, policies and guidelines, including the imposition of additional regulatory
oversight around clinical testing generally or with respect to our therapies in particular;

• insufficiency of our financial and other resources to complete the necessary activities to prepare for launch
commercialization and/or resources to address coverage and reimbursement matters to the extent any of our product candidates receive approval; or

• varying interpretations of data by the FDA, EMA, or other comparable regulatory authorities.

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***The successful development of pharmaceutical products involves a lengthy and expensive process and is highly uncertain.***

Successful development of pharmaceutical products involves a lengthy and expensive process, is highly uncertain, and is dependent on numerous factors, many of which are beyond our control. Failure can occur at any time during the preclinical study or clinical trial process. A number of companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in clinical development even after achieving promising results in earlier studies, and the historical failure rate for product candidates in our industry is high. The results from preclinical studies or early clinical trials of a product candidate may not predict the results of later clinical trials of the product candidate, and interim results of a clinical trial are not necessarily indicative of final results. Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses. Product candidates that appear promising in the early phases of development may fail to reach the market for several reasons, including:

• clinical trial results may show the product candidates to be less effective than expected (for example, a clinical trial
could fail to meet its primary or key secondary endpoint(s)) or have an unacceptable safety or tolerability profile;

• failure to receive the necessary regulatory approvals or a delay in receiving such approvals, which, among other things,
may be caused by patients who fail the trial screening process, slow enrollment in clinical trials, patients dropping out of trials, patients lost to follow-up, length of time to achieve trial endpoints,
additional time requirements for data analysis or New Drug Application ("NDA") or similar foreign application preparation, discussions with the FDA, EMA, or other comparable regulatory authority, an FDA, EMA, or other comparable
regulatory request for additional preclinical or clinical data (such as long-term toxicology studies) or unexpected safety or manufacturing issues;

• preclinical study results may show the product candidate to be less effective than desired or to have harmful side effects;

• post-marketing approval requirements; or

• the proprietary rights of others and their competing products and technologies that may prevent our product candidates from
being commercialized.

Even if we are successful in obtaining marketing approval, commercial success of any approved products will also depend in large part on the availability of coverage and adequate reimbursement from third-party payors, including government payors such as the Medicare and Medicaid programs and managed care organizations in the United States or country-specific governmental organizations in foreign countries, which may be affected by existing and future healthcare reform measures designed to reduce the cost of healthcare. Third-party payors could require us to conduct additional studies, including post-marketing studies related to the cost effectiveness of a product, to qualify for reimbursement, which could be costly and divert our resources. If government and other healthcare payors were not to provide coverage and adequate reimbursement for our products once approved, market acceptance and commercial success would be reduced. Even if we are able to obtain coverage and adequate reimbursement for our products once approved, there may be features or characteristics of our products, such as dose preparation requirements, that prevent our products from achieving market acceptance by the healthcare or patient communities.

In addition, if any of our product candidates receive marketing approval, we will be subject to significant regulatory obligations regarding the submission of safety and other post-marketing information and reports and registration, and will need to continue to comply (or ensure that our third-party providers comply) with current Good Manufacturing Practices ("cGMPs") and Good Clinical Practices ("GCPs") for any clinical trials that

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we conduct post-approval. In addition, there is always the risk that we, a regulatory authority or a third party might identify previously unknown problems with a product post-approval, such as AEs of unanticipated severity or frequency. Compliance with these requirements is costly, and any failure to comply or other issues with our product candidates post-approval could adversely affect our business, financial condition and results of operations.

***Due to the significant resources required for the development of our pipeline, and depending on our ability to access capital, we must prioritize the development of certain product candidates over others. Moreover, we may fail to expend our limited resources on product candidates or indications that may have been more profitable or for which there is a greater likelihood of success.***

Our lead product candidates, Danicamtiv for treatment of genetic DCM, Ataciguat for treatment of moderate CAVS, and Tonlamarsen for post-hospitalization management of ASH, are at various stages of clinical development. Danicamtiv is being evaluated in the ongoing KINSHIP-DCM Phase 2b/3 trial, Ataciguat is being evaluated in an ongoing KATALYST-AV Phase 2b/3 trial and Tonlamarsen is being evaluated in the ongoing KARDINAL-ASH Phase 2 trial. We seek to rapidly advance discovery and development of transformational medicines for patients suffering from cardiovascular diseases.

Due to the significant resources required for the development of our product candidates, we must decide which product candidates and indications to pursue and advance and the amount of resources to allocate to each. Our decisions concerning the allocation of research, development, collaboration, management and financial resources toward particular product candidates, therapeutic areas or indications may not lead to the development of viable commercial products and may divert resources away from better opportunities. If we make incorrect determinations regarding the viability or market potential of any of our product candidates or misread trends in the pharmaceutical industry, in particular for cardiovascular diseases, our business, financial condition and results of operations could be materially and adversely affected. As a result, we may fail to capitalize on viable commercial products or profitable market opportunities, be required to forego or delay pursuit of opportunities with other product candidates or other diseases and disease pathways that may later prove to have greater commercial potential than those we choose to pursue, or relinquish valuable rights to such product candidates through collaboration, licensing or royalty arrangements in cases in which it would have been advantageous for us to invest additional resources to retain sole development and commercialization rights.

***We may seek to grow our business through acquisitions or investments in new or complementary businesses, products or technologies, through the licensing of products or technologies from third parties or other strategic alliances. The failure to manage acquisitions, investments, licenses or other strategic alliances, or the failure to integrate them with our existing business, could have a material adverse effect on our operating results, dilute our stockholders' ownership, increase our debt or cause us to incur significant expense.***

Our success depends on our ability to continually enhance and broaden our product offerings in response to changing clinicians' and patients' needs, competitive technologies and market pressures. Accordingly, from time to time we may consider opportunities to acquire, make investments in or license other technologies, products and businesses that may enhance our capabilities, complement our existing products and technologies or expand the breadth of our markets or customer base. For example, in February 2025, we acquired 100% of the equity interests in Prolaio, Inc., a clinical intelligence company developing patient data collection software, and in June 2024, we acquired RSF, a clinical-stage cardiovascular platform company. Potential and completed acquisitions, strategic investments, licenses and other alliances involve numerous risks, including:

• difficulty assimilating or integrating acquired or licensed technologies, products, employees or business operations;

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• issues maintaining uniform standards, procedures, controls and policies;

• unanticipated costs associated with acquisitions or strategic alliances, including the assumption of unknown or contingent
liabilities and the incurrence of debt or future write-offs of intangible assets or goodwill;

• diversion of management's attention from our core business and disruption of ongoing operations;

• adverse effects on existing business relationships with suppliers, sales agents, health care facilities, surgeons and other
health care providers;

• risks associated with entering new markets in which we have limited or no experience;

• potential losses related to investments in other companies;

• potential loss of key employees of acquired businesses; and

• increased legal and accounting compliance costs.

We do not know if we will be able to identify acquisitions or strategic relationships we deem suitable, whether we will be able to successfully complete any such transactions on favorable terms, if at all, or whether we will be able to successfully integrate any acquired business, product or technology into our business or retain any key personnel, suppliers, sales agent, health care facilities, physicians or other health care providers. Our ability to successfully grow through strategic transactions depends upon our ability to identify, negotiate, complete and integrate suitable target businesses, technologies or products and to obtain any necessary financing. These efforts could be expensive and time-consuming and may disrupt our ongoing business and prevent management from focusing on our operations. In addition, the integration of any business that we may acquire in the future may disrupt our existing business and may be a complex, risky and costly endeavor for which we may never realize the full benefits. Furthermore, we may experience losses related to investments in other companies, including as a result of failure to realize expected benefits or the materialization of unexpected liabilities or risks, which could have a material negative effect on our results of operations and financial condition. Accordingly, although there can be no assurance that we will undertake or successfully complete any additional transactions of the nature described above, any additional transactions that we do complete could have a material adverse effect on our business, financial condition, results of operations and prospects.

To finance any acquisitions, investments or strategic alliances, we may choose to issue shares of our common stock as consideration, which could dilute the ownership of our stockholders. If the price of our common stock is low or volatile, we may be unable to consummate any acquisitions, investments or strategic alliances using our common stock as consideration. Additional funds may not be available on terms that are favorable to us, or at all.

***We may experience challenges with the acquisition, development, enhancement or deployment of technology necessary for our Prolaio platform.***

The Prolaio platform requires sophisticated computer systems and software for data collection, data processing, cloud-based platforms, analytics, and other applications and technologies. We are building artificial intelligence ("AI") technologies into internal applications and solutions; we expect the use of AI to grow. Some of these technologies are changing rapidly and we must continue to adapt to these changes in a timely and effective manner at an acceptable cost. There can be no guarantee that we will be able to develop, acquire or integrate new technologies, that these new technologies will meet our needs or those of our clients' or achieve expected investment goals, or that we will be able to do so as quickly or cost-effectively as our competitors. Our continued success will depend on our ability to adapt to changing technologies, manage and

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process ever-increasing amounts of data and information and improve the performance, features and reliability of our services. We may experience difficulties that could delay or prevent the successful design, development, testing, introduction or marketing of our services. New services, or enhancements to existing services, may not adequately meet our own requirements or those of current and prospective clients or achieve any degree of significant market acceptance. Regulations relating to the use of AI and the interpretation of those regulations by regulators, courts and others are in the early stages of development and evolving, which may make it difficult to identify adequate compliance requirements or suitable governance practices to meet those requirements. These types of failures could have a material adverse effect on our operating results, financial condition and reputation.

***We have completed related party transactions that may not have been conducted on an arm's length basis.***

We have in the past been and may in the future be party to certain transactions with certain entities affiliated with our directors, executive officers and principal stockholders. For example, we acquired Prolaio, Inc. At the time of the acquisition, Tassos Gianakakos, our Chief Executive Officer, also served as Prolaio's Chief Executive Officer and Jay Edelberg, our Chief Medical Officer, served as its President, Research & Development. Mr. Gianakakos and Dr. Edelberg owned 55.7% and 16.6%, respectively, of Prolaio at the time of its acquisition by us. For additional information related to this and other related party transactions, please see the section titled "*Certain Relationships and Related Person Transactions.*" Although we believe that these transactions were conducted on an arm's length basis, it is possible that the terms were less favorable to us than they might have been in a transaction with an unrelated party.

In connection with the initial public offering, we plan to adopt a written related-person transactions policy that sets forth our policies and procedures regarding the identification, review, consideration and oversight of related-person transactions.

***We, third-parties on which we rely and our service providers are, or may become, subject to a variety of stringent and evolving data privacy and security laws, regulations, and rules, contractual obligations, industry standards, policies and other obligations related to data privacy and security. Any actual or perceived failure to comply with such obligations could expose us to significant fines or other penalties and otherwise harm our business and operations.***

In the ordinary course of our business, we and the third parties upon which we rely (such as our third party Contract Research Organizations ("CROs") and other contractors and consultants) collect, receive, store, process, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, and share (collectively, process) personal data and other sensitive information, including proprietary and confidential business data, trade secrets, intellectual property, sensitive third-party data, business plans, transactions, financial information and data we collect about trial participants in connection with clinical trials (collectively, sensitive data). Through our acquisition of Prolaio, we have acquired an FDA-cleared patient data collection software platform and cardiovascular clinical data, which we use to enhance data collection and analysis in our clinical trials. Prolaio's operations significantly expand the volume and sensitivity of patient health data we process, including high-density patient data collected through Prolaio's data collection software and clinical datasets. Our data processing activities subject us to numerous evolving data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal privacy and security policies, contractual requirements, and other obligations relating to data privacy and security. The legislative and regulatory framework for the processing of personal data worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future. This evolution may create uncertainty in our business, affect our ability to operate in certain jurisdictions or to collect, store, transfer, use and share sensitive data, necessitate the acceptance of more onerous obligations in our contracts, result in liability or impose additional costs on us. The cost of compliance with these laws, regulations and standards is high and is likely to increase in the future.

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Any failure or perceived failure by us to comply with federal, state or foreign laws or regulations, our internal policies and procedures or our contracts governing our processing of sensitive data could result in negative publicity, government investigations and enforcement actions, claims by third parties and damage to our reputation, any of which could have a material adverse effect on our business, results of operations, and financial condition.

In the United States, numerous federal, state and local laws and regulations, including federal health information privacy laws, state information security and data breach notification laws, federal and state consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other similar laws (e.g., wiretapping laws) govern the processing of health-related and other personal data. At a federal level, HIPAA imposes, among other things, certain standards relating to the privacy, security, transmission of and breach reporting related to individually protected identifiable health information ("PHI"). We may obtain health information from third parties, such as research institutions with which we collaborate, that are subject to privacy and security requirements under HIPAA. Although we do not believe that we are directly subject to HIPAA, other than potentially with respect to providing certain employee benefits, we could be subject to criminal penalties if we knowingly obtain or disclose PHI maintained by a HIPAA covered entity in a manner that is not authorized or permitted by HIPAA. We currently use Prolaio's platform for our own clinical research purposes. To the extent we obtain PHI from covered entities under HIPAA, such as hospitals or clinical trial sites, for use with Prolaio's platform or otherwise, we may be required to enter into data use agreements or business associate agreements and comply with applicable contractual and regulatory requirements for the use and disclosure of such information, including requirements related to de-identification, limited data sets, appropriate administrative, physical and technical safeguards, and breach notification. If we were to expand Prolaio's operations to provide services to external healthcare providers or other covered entities, we could become subject to more extensive HIPAA business associate obligations, including direct enforcement by the U.S. Department of Health and Human Services Office for Civil Rights, which could impose civil monetary penalties as well as criminal penalties for violations of HIPAA.

We may also obtain patient health records through platforms that participate in the Trusted Exchange Framework and Common Agreement ("TEFCA"), a nationwide health information exchange framework established under the 21st Century Cures Act and administered by ONC. TEFCA imposes privacy, security, and individual rights requirements, including individual consent and data deletion rights, on entities that participate in TEFCA exchange activities. We obtain patient records through a third-party platform operating as an Individual Access Services provider under TEFCA, pursuant to which individuals consent to retrieval of their health records for use in our clinical research. Depending on the scope of our participation in TEFCA exchange activities, we may be subject to TEFCA's contractual obligations, including obligations that may conflict with data retention requirements under the Common Rule and FDA clinical trial regulations. The application of TEFCA's requirements to clinical research is an area of evolving legal interpretation for which regulatory guidance remains limited. Failure to comply with applicable TEFCA requirements, or changes in how those requirements are interpreted or enforced, could require us to modify our data collection practices in ways that adversely affect our clinical operations or expose us to contractual liability or regulatory scrutiny.

At the state level, numerous U.S. states have enacted comprehensive privacy laws, such as the California Consumer Privacy Act (the "CCPA") and several others that impose certain obligations on covered businesses, including providing specific disclosures in privacy notices and affording individuals certain rights concerning their personal data. Similar laws and several others in several other states, as well as at the federal and local levels, and we expect more states to pass similar laws in the future. While these comprehensive privacy laws that are in effect at the state level generally exempt certain data processed in the context of clinical trials, the continued development of new privacy laws at the state level may further complicate compliance efforts, and increase legal risk and compliance costs for us and the third parties upon whom we rely. Further proposed

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privacy legislation, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of data and information that could be of potential use to the growth and development of our business and could result in increased compliance costs and/or the necessity of making changes in our business practices and policies. The continued further development of privacy laws in different states could make our compliance obligations more complex and costly and may increase the likelihood that we may be subject to enforcement actions or otherwise incur liability for noncompliance that could adversely impact our financial condition. Additionally, we may be subject to laws governing the privacy of specific types of data, including, biometric information and, notably, consumer health data. For example, Washington's My Health My Data Act broadly defines consumer health data, creates a private right of action to allow individuals to sue for violations of the law, imposes stringent consent requirements and grants consumers certain rights with respect to their health data, including to request deletion of their information. Connecticut and Nevada have also passed similar laws regulating consumer health data. These various data privacy and security laws may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products. Such laws could have potentially conflicting requirements that would make compliance challenging. In the event that we are subject to or affected by these U.S. state privacy and data protection laws, any liability from failure to comply with the requirements of these laws could adversely affect our financial condition.

Outside the United States, an increasing number of laws, regulations, and industry standards govern data privacy and security. For example, the European Union's General Data Protection Regulation ("EU GDPR") and the United Kingdom's General Data Protection Regulation and Data Protection Act 2018 (collectively, the "UK GDPR" and together with the EU GDPR, the "GDPR") impose strict requirements for processing personal data of individuals within the European Economic Area ("EEA") and the United Kingdom ("UK"). These European regimes include strict requirements relating to processing of sensitive data (such as health data), ensuring there is a legal basis or condition to justify the processing of personal data, obtaining consent of individuals in certain circumstances, disclosing how personal data is to be used, limiting retention of information, implementing safeguards to protect the security and confidentiality of personal data, providing notification of data breaches, maintaining records of processing activities, documenting data protection impact assessments where there is high-risk processing and taking certain measures when engaging third-party processors.

Under GDPR, companies may face temporary or definitive bans on data processing and other corrective activities, fines of up to €20 million (£17.5 million GBP) or 4% of the annual global revenues of the noncompliant undertaking, whichever is greater, private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests; or regulatory investigations, reputational damage, orders to cease/change our data processing activities, enforcement notices and/or assessment notices (for a compulsory audit). Non-compliance could also result in a material adverse effect on our business, financial position and results of operations.

In addition, we may be unable to transfer personal data from Europe and other jurisdictions to the United States or other countries or we may have to implement additional measures to enable such transfers due to data localization requirements or limitations on cross-border data flows. Among other requirements, the GDPR restricts the transfers of personal data subject to the GDPR to third countries that have not been found to provide adequate protection to such personal data, including the United States, unless a derogation exists or we implement a valid GDPR transfer mechanism (for example, the European Commission approved Standard Contractual Clauses and the UK International Data Transfer Agreement/Addendum and conduct transfer impact assessments to assess whether the recipient can ensure certain guarantees under the GDPR). However, the efficacy and longevity of current transfer mechanisms remains uncertain. We expect the existing legal complexity and uncertainty regarding international personal data transfers to continue and international

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transfers to the United States and to other jurisdictions more generally to continue to be subject to enhanced scrutiny by regulators. As the regulatory guidance and enforcement landscape in relation to data transfers continue to develop, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we operate our business, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.

The UK's data protection regime is independent from but aligned to the EU's data protection regime. However following the UK's departure from the European Union ("Brexit"), there will be increasing scope for divergence in application, interpretation and enforcement of the data protection laws between these territories. For example, the UK Data (Use and Access) Act 2025 ("UK Act"), now in force, further alters the similarities between the UK and EEA data protection regimes. In December 2025, the European Commission adopted a decision determining that the UK continues to provide a level of data protection that is "essentially equivalent" to the EU standards and extended the validity of the UK adequacy decision for six years, through December 2031. While this renewal reduces immediate adequacy concerns for transfers of personal data from the EEA to the UK, uncertainty remains regarding how UK data protection laws will evolve in the medium to longer term. This lack of clarity on future UK laws and regulations and their interaction with those of the EU could add legal risk, uncertainty, complexity, and cost to our handling of European personal data and our privacy and security compliance programs, and any resulting divergence in laws could increase our risk profile and may require us to implement different compliance measures for the UK and EEA. In addition, EEA Member States have adopted national laws to implement the GDPR that may partially deviate from the GDPR. Further, the competent authorities in the EEA Member States interpret GDPR obligations slightly differently from country to country (particularly in relation to the processing of health data) and therefore we do not expect to operate in a uniform legal landscape in the EEA. The European Commission has also proposed further reforms under the so-called "Digital Omnibus" package, which is intended to streamline and update aspects of the EU's digital regulatory framework, including certain data protection obligations. While the scope and final form of these proposals remain subject to legislative negotiation, if adopted they may further modify or supplement existing GDPR-related requirements, including by further clarifying the scope of what constitutes "personal data" and the regulatory treatment of coded, key-coded or otherwise de-identified data. Any such changes could require us to reassess and adjust our European privacy compliance framework, resulting in additional legal, operational and compliance costs.

Additionally, in 2025, the U.S. Department of Justice ("DoJ") issued a rule entitled Preventing Access to U.S. Sensitive Personal Data and Government-Related Data by Countries of Concern or Covered Persons, which places additional restrictions on certain data transactions involving countries of concern (e.g., China, Russia, Iran) and generally prohibits data brokerage transactions involving certain sensitive personal data categories, including health data, genetic data, and biospecimens, to these countries of concern. The rule impacts certain business or management activities such as vendor engagements, licensing arrangements, partnership engagements, sale or sharing of data, employment of certain individuals and investor agreements. Violations of the rule could lead to significant civil and criminal fines and penalties. We may in the future engage in data transactions that could be subject to the rule. There is a risk that our interpretation of the rule's applicability, scope and requirements could be incorrect, incomplete, or misapplied. The rule applies to certain data transactions even where data is anonymized, key-coded, pseudonymized, de-identified or encrypted, which may impact our ability to enter into certain agreements.

In addition to data privacy and security laws, we are also bound by other contractual obligations related to data privacy and security, and our efforts to comply with such obligations may not be successful. We may publish privacy policies and marketing materials, and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security. Regulators such as the U.S. Federal Trade

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Commission are increasingly scrutinizing these statements, and if these policies, materials or statements are found to be deficient, lacking in transparency, deceptive, unfair, or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators, or other adverse consequences.

We may at times fail (or be perceived to have failed) in our efforts to comply with our data privacy and security obligations. Moreover, despite our efforts, our personnel or third parties on whom we rely may fail (or be perceived to have failed) to comply with such obligations, which could negatively impact our business operations. If we or the third parties on which we rely fail, or are perceived to have failed, to address or comply with applicable data privacy and security obligations, we could face significant consequences, including but not limited to: government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class-action claims) and mass arbitration demands; additional reporting requirements and/or oversight; bans on processing personal data; and orders to destroy or not use personal data. In particular, plaintiffs have become increasingly more active in bringing privacy-related claims against companies, including class claims and mass arbitration demands. Some of these claims allow for the recovery of statutory damages on a per violation basis, and, if viable, carry the potential for monumental statutory damages, depending on the volume of data and the number of violations. Any of these events could have a material adverse effect on our reputation, business, or financial condition, including but not limited to: loss of customers; interruptions or stoppages in our business operations (including, as relevant, clinical trials); inability to process personal data or to operate in certain jurisdictions; limited ability to develop or commercialize our products; expenditure of time and resources to defend any claim or inquiry; potentially significant penalties if we are found to be in violation of our privacy obligations; adverse publicity; or substantial changes to our business model or operations.

***Our information technology systems and infrastructure, or those of our collaborators and service providers, or our data, may be subject to cyber-attacks, intrusions, breaches, compromises, disruptions or other cybersecurity incidents, which could result in additional costs, loss of revenue, significant liabilities, harm to our brand, material disruption of our development programs and operations, or other adverse consequences.***

In the ordinary course of our business, we and the third parties upon which we rely, process sensitive data, and, as a result, we and the third parties upon which we rely face a variety of evolving threats that could cause cyber-attacks, intrusions, breaches, compromises, disruptions or other cybersecurity incidents. Although we take steps to develop and maintain systems and controls designed to protect our sensitive data, systems and infrastructure, there can be no assurance that our internal technology systems and infrastructure, or those of third parties upon which we rely, will be sufficient to protect against a cyber-attack, intrusion, breach, compromise, disruption or other cybersecurity incident such as an industrial espionage attack, ransomware, or insider threat attack such as wrongful conduct by employees or vendors, which may compromise our system infrastructure or lead to the loss, destruction, alteration or dissemination of, or damage to, our sensitive data. Such threats are prevalent and continue to rise, are increasingly difficult to detect, and come from a variety of sources, including traditional computer "hackers," threat actors, "hacktivists," organized criminal threat actors, personnel (such as through theft or misuse), sophisticated nation states, and nation-state-supported actors.

The risk of a cyber-attack, intrusion, breach, compromise, disruption or other cybersecurity incident has generally increased as the number, intensity and sophistication of attempted attacks and intrusions from around the world have grown. Such risks come from a variety of evolving threats, including but not limited to, social engineering attacks (including through deep fakes, which may be increasingly more difficult to identify as fake, and phishing attacks), malicious code (such as viruses and worms), misconfigurations, "bugs" or other vulnerabilities in software that is integrated into our technology systems and infrastructure, malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks, credential stuffing, credential harvesting, personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, attacks enhanced or

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facilitated by AI, telecommunications failures, earthquakes, fires, floods, and other similar threats. Further, there can also be no assurance that our and our third-party service providers', strategic partners', contractors', consultants', CROs' and collaborators' cybersecurity risk management program and processes, including policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems, networks and sensitive data.

Threat actors engage in and are expected to continue to engage in cyber-attacks, including without limitation nation-state actors for geopolitical reasons and in conjunction with military conflicts and defense activities. During times of war and other major conflicts, we and the third parties upon which we rely, may be vulnerable to a heightened risk of cyber-attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our services. Additionally, severe ransomware attacks are becoming increasingly prevalent and can lead to significant interruptions in our operations, ability to provide our products or services, loss of sensitive data and income, reputational harm, and diversion of funds. Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments.

We also face increased risks of a cyber-attack, intrusion, breach, compromise, disruption or other cybersecurity incident due to our reliance on internet technology and the number of our employees who work on a hybrid basis at home, in the office, or other public spaces. This may create additional opportunities for cybercriminals to exploit vulnerabilities. Additionally, business transactions (such as acquisitions or integrations) could expose us to additional cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities' systems and technologies that were not found during due diligence of such acquired or integrated entities.

In addition, our reliance on third-party service providers could introduce new cybersecurity risks and vulnerabilities, including supply-chain attacks. We rely on third-party service providers and technologies to operate critical business systems to process sensitive data in a variety of contexts and our ability to monitor these third parties' information security practices is limited. These third parties may not have adequate information security measures in place and if our third-party service providers experience a cyber-attack, security breach, compromise, disruption or other cybersecurity incident, we could experience adverse consequences. While we may be entitled to damages if our third-party service providers fail to satisfy their privacy or cybersecurity-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award.

We may be unable to detect vulnerabilities in our information technology systems and infrastructure on a timely basis or until after a cyber-attack, intrusion, breach, compromise, disruption or other cybersecurity incident has occurred, and it may be difficult and/or costly to investigate, mitigate, contain, and remediate a cybersecurity incident. Further, we may experience delays in developing and deploying remedial measures designed to adequately address any such identified vulnerabilities. Our efforts to do so may not be successful. Actions taken by us or the third parties with whom we work to detect, investigate, mitigate, contain, and remediate a cybersecurity incident could result in outages, data losses, and disruptions of our business. Threat actors may also gain access to other networks and systems after a compromise of our networks and systems. For example, threat actors may use an initial compromise of one part of our environment to gain access to other parts of our environment, or leverage a compromise of our networks or systems to gain access to the networks or systems of third parties with whom we work, such as through phishing or supply chain attacks.

We have in the past experienced threats related to our data and systems, and we may in the future experience additional threats, compromises, breaches or other cybersecurity incidents. If we, or a third party upon whom we rely, experience a cyber-attack, intrusion, breach, compromise, disruption or other cybersecurity incident,

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or are perceived to have experienced one, we may experience adverse consequences, such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing sensitive information (including personal data); litigation (including individual and group claims); significant incident response, system restoration or remediation costs; indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other potentially significant harms. Further, applicable data privacy and cybersecurity obligations may require us to notify individuals, regulators, or other relevant stakeholders of a cyber-attack, intrusion, breach, compromise, disruption, or other cybersecurity incident. Such disclosures are costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences. In addition, cyber-attacks, intrusions, breaches, compromises, disruptions or other cybersecurity incidents may cause stakeholders (including investors and potential customers) to stop supporting our business, deter new customers from using our products, and negatively impact our ability to grow and operate our business.

Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and cybersecurity obligations. Further, our existing general liability and cyber liability insurance policies may not cover, or may cover only a portion of, any potential claims related to cybersecurity breaches to which we are exposed or may not be adequate to indemnify us for all or any portion of liabilities that may be imposed. We also cannot be certain that our existing insurance coverage will continue to be available on acceptable terms or in amounts sufficient to cover the potentially significant losses that may result from a cybersecurity incident or breach or that the insurer will not deny coverage of any future claim. Accordingly, if our cybersecurity measures, and those of our service providers, fail to protect against unauthorized access, attacks (which may include sophisticated cyberattacks) and the mishandling of data by our employees and third-party service providers, then our reputation, business, results of operations and financial condition could be adversely affected.

***The use of new and evolving technologies, such as AI and machine learning ("ML"), in our operations, and the operations of third parties upon which we rely, may result in spending additional resources and present new risks and challenges that can impact our business including by posing cybersecurity and other risks to our sensitive data, and as a result we may be exposed to reputational harm, other adverse consequences, and liability.***

We use and integrate AI/ML systems in our business, primarily in our Prolaio platform. The use of new and evolving technologies, such as AI/ML, in our operations, and the operations of third parties upon which we rely presents new risks and challenges that could negatively impact our business. The use of new and evolving technologies, such as AI/ML, in our operations, and the operations of third parties upon which we rely, presents new risks and challenges that could negatively impact our business, including cybersecurity, data privacy, IT, intellectual property, regulatory, legal, operational, competitive, reputational, and other risks and challenges. Specifically, risks related to bias, AI hallucinations, discrimination, harmful content, misinformation, fraud, scams, targeted attacks such as model poisoning or data poisoning, surveillance, data leakage, loss of consensus reality, inequality, environmental harms, and other harms may flow from our development, use, or deployment of AI technologies.

We expect that increased investment will be required in the future to continuously improve our AI/ML systems. As with many technological innovations, there are significant risks involved in developing, maintaining and deploying these technologies and there can be no assurance that the usage of our investments in such technologies will always enhance our products or services or be beneficial to our business, including our efficiency or profitability.

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The use of certain AI/ML technology can give rise to intellectual property risks, including by disclosing or otherwise compromising our confidential or proprietary intellectual property and intellectual property infringement, or by undermining our ability to assert or defend ownership rights in intellectual property created with the assistance of AI/ML tools. For example, we may experience difficulties in enforcing the intellectual property rights in output generated by AI/ML technologies. The United States Copyright Office has previously denied copyright protection for content generated by AI/ML technologies, and the United States Patent and Trademark Office has similarly stated that an AI/ML tool cannot be an "inventor" of a patent, rendering it impossible to obtain patent protection for inventions created solely by AI/ML technologies. The Supreme Court of the United Kingdom has reached a similar conclusion, stating that AI/ML systems cannot be named as an "inventor" for UK patent law purposes. Additionally, several jurisdictions around the globe, including in Europe and the U.S., have proposed, enacted, or are considering, laws governing the development and use of AI/ML, such as the EU's AI Act, a significant part of which is scheduled to come into effect in August 2026. As currently enacted, the EU AI Act imposes significant obligations on providers and deployers of high-risk AI systems, and encourages providers and deployers of AI systems to account for EU ethical principles in their development and use of these systems. If we use AI/ML systems that are governed by the EU AI Act, it may necessitate ensuring higher standards of data quality, transparency, and human oversight, as well as adhering to specific and potentially burdensome and costly ethical, accountability, and administrative requirements. We expect other jurisdictions will adopt similar laws.

In the U.S., the regulatory framework for AI/ML technologies faces significant uncertainty. At the federal level, Congress has yet to enact meaningful AI legislation. In the absence of federal AI legislation, states have filled the void by enacting laws regulating different aspects of AI/ML technologies. For example, California has enacted laws and regulations related to AI/ML safety protocols, reporting and transparency, among other AI-related topics. In addition, Colorado's Artificial Intelligence Act will require developers and deployers of "high-risk" AI systems to implement certain safeguards against algorithmic discrimination (among other requirements). Numerous other states have enacted, passed, or are considering AI-focused legislation, creating a patchwork of regulations and a complex compliance challenge. The Trump Administration has endorsed a federal moratorium on the enforcement of state AI laws, including through a December 11, 2025, executive order on "Ensuring a National Policy Framework for Artificial Intelligence." So far, these efforts have not been successful at curtailing state action on AI regulation, contributing to a complicated legislative patchwork, which may be litigated in state and federal courts. Any failure or perceived failure by us to comply with existing or newly enacted laws, regulations and other requirements relating to AI/ML technologies could result in legal claims or proceedings (including class actions), regulatory investigations or enforcement actions.

Additionally, certain privacy laws extend rights to consumers (such as the right to delete certain personal data) and regulate automated decision making, which may be incompatible with our use of AI/ML. These obligations may make it harder for us to conduct our business using AI/ML, lead to regulatory fines or penalties, require us to change our business practices, retrain our AI/ML, or prevent or limit our use of AI/ML. For example, the Federal Trade Commission has required other companies to turn over (or disgorge) valuable insights or trainings generated through the use of AI/ML where they allege the company has violated certain privacy and consumer protection laws. If we cannot use AI/ML or that use is restricted, our business may be less efficient, or we may be at a competitive disadvantage.

The rapid evolution of AI/ML will require the application of significant resources to design, develop, test and maintain our products and services to help ensure that AI/ML is implemented in accordance with applicable law and regulation and in a socially responsible manner and to minimize any real or perceived unintended harmful impacts. Our vendors may in turn incorporate AI/ML tools into their own offerings, and the providers of these AI/ML tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to data privacy and cybersecurity. Further, bad actors around the world use increasingly sophisticated

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methods, including the use of AI/ML, to expand potential attack surfaces and otherwise engage in illegal activities involving the theft and misuse of sensitive data. Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, and adversely impact our business.

**Risks related to the discovery and development of our current or future product candidates** 

***The regulatory approval processes of the FDA, EMA, and other comparable regulatory authorities are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed.***

We are not permitted to commercialize, market, promote or sell any product candidate in the United States without obtaining regulatory approval from the FDA. Foreign regulatory authorities, such as the EMA and national competent authorities in EU Member States, impose similar requirements. The time required to obtain approval by the FDA, EMA, or other comparable regulatory authorities is inherently unpredictable, but typically takes many years following the commencement of clinical trials and depends upon numerous factors, including substantial discretion of the regulatory authorities. In addition, approval policies, regulations, or the type and amount of clinical data necessary to gain approval may change during the course of a product candidate's clinical development and may vary among jurisdictions. For instance, jurisdictions outside of the United States, such as the European Union or Japan, may have different requirements for regulatory approval, which may require us to conduct additional clinical, nonclinical or chemistry, manufacturing and control studies. To date, we have not submitted an NDA to the FDA or similar drug approval submissions to comparable foreign regulatory authorities for any product candidate. We must complete additional preclinical studies and clinical trials to demonstrate the safety and efficacy of our product candidates in humans before we will be able to obtain these approvals.

Before obtaining approval from regulatory authorities for the commercialization of any of our product candidates, we must conduct extensive clinical trials to demonstrate the safety and efficacy of the product candidate in humans. Clinical testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome. We cannot guarantee that any clinical trials will be conducted as planned or completed on schedule, if at all. The clinical development of our initial and potential additional product candidates is susceptible to the risk of failure inherent at any stage of development, including failure to demonstrate efficacy in a clinical trial or across a broad population of patients, the occurrence of AEs that are severe or medically or commercially unacceptable, failure to comply with protocols or applicable regulatory requirements and determination by the FDA, EMA, or other comparable regulatory authorities that a product candidate may not continue development or is not approvable. It is possible that even if any of our product candidates have a beneficial effect, that effect will not be detected during clinical evaluation as a result of one or more of a variety of factors, including the size, duration, design, measurements, conduct or analysis of our clinical trials. Conversely, as a result of the same factors, our clinical trials may indicate an apparent positive effect of such product candidate that is greater than the actual positive effect, if any. Similarly, in our clinical trials we may fail to detect toxicity of, or intolerability caused by, such product candidate, or mistakenly believe that our product candidates are toxic or not well-tolerated when that is not in fact the case. Serious AEs or other AEs, as well as tolerability issues, could hinder or prevent market acceptance of the product candidate at issue.

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Our current and future product candidates could fail to receive regulatory approval for many reasons, including the following:

• the FDA, EMA, or other comparable regulatory authorities may disagree as to the design or implementation of our clinical
trials;

• we may be unable to demonstrate to the satisfaction of the FDA, EMA, or other comparable regulatory authorities that a
product candidate is safe and effective for its proposed indication;

• the results of clinical trials may not meet the level of statistical significance required by the FDA, EMA, or other
comparable regulatory authorities for approval;

• we may be unable to demonstrate that a product candidate's clinical and other benefits outweigh its safety risks;

• the FDA, EMA, or other comparable regulatory authorities may disagree with our interpretation of data from clinical trials
or preclinical studies;

• the data collected from clinical trials of our product candidates may not be sufficient to support the submission of an NDA
to the FDA or other submission or to obtain regulatory approval in the United States, the European Union or elsewhere;

• the FDA, EMA, or other comparable regulatory authorities may find deficiencies with or fail to approve the manufacturing
processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and

• the approval policies or regulations of the FDA, EMA, or other comparable regulatory authorities may significantly change
in a manner rendering our clinical data insufficient for approval.

This lengthy approval process as well as the unpredictability of clinical trial results may result in our failing to obtain regulatory approval to market any product candidate we develop, which would substantially harm our business, financial condition, results of operations and prospects. The FDA, EMA, and other comparable regulatory authorities have substantial discretion in the approval process and determining when or whether regulatory approval will be granted for any product candidate that we develop. Even if we believe the data collected from future clinical trials of our product candidates are promising, such data may not be sufficient to support approval by the FDA, EMA, or other comparable regulatory authorities. Furthermore, the U.S. Supreme Court's July 2024 decision to overturn prior established case law giving deference to regulatory agencies' interpretations of ambiguous statutory language has introduced uncertainty regarding the extent to which FDA's regulations, policies and decisions may become subject to increasing legal challenges, delays, and/or changes.

In addition, even if we were to obtain approval, regulatory authorities may approve any of our product candidates for fewer or more limited indications than we request, may not approve the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing clinical trials or may approve a product candidate with a label that does not include the labeling claims necessary or desirable for the successful commercialization of that product candidate. Any of the foregoing scenarios could materially harm the commercial prospects for our product candidates.

In addition, FDA and foreign regulatory authorities may change their approval policies and new regulations may be enacted. For instance, the EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. The European Commission's proposal for revision of several legislative instruments related to medicinal products (potentially reducing the duration of regulatory data protection, revising the eligibility for

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expedited pathways, etc.) was published on April 26, 2023. In April 2024, the European Parliament adopted its position on the legislative proposals and, in June 2025, the Council of the European Union adopted its position. A common position on the text was agreed upon on December 11, 2025, in the context of subsequent inter-institutional trilogue negotiations. The proposed revisions remain to be adopted into EU law, and are not expected to become applicable before 2028. The revisions may, however, have a significant impact on the pharmaceutical industry and our business in the long term.

***The FDA, EMA or comparable regulatory authorities may disagree with our regulatory plan for our product candidates.***

The general approach for FDA approval of a new drug is dispositive data from two or more adequate and well-controlled clinical trials of the product candidate in the relevant patient population. Adequate and well-controlled clinical trials typically involve a large number of patients, have significant costs and take years to complete. The FDA, EMA or other comparable regulatory authorities may disagree with us about whether a clinical trial is adequate and well-controlled or may request that we conduct additional clinical trials prior to regulatory approval. In addition, there is no assurance that the doses, endpoints and trial designs that we intend to use for our planned clinical trials, including those that we have developed based on feedback from regulatory agencies or those that have been used for the approval of similar drugs, will be acceptable for future approvals. For instance, we may seek FDA regulatory flexibility and pursue marketing approval based on data from only one adequate and well-controlled clinical investigation. However, the FDA may not agree with our proposed development plans, and our clinical trial results may not support approval of our product candidates for our target indications. In addition, our product candidates could fail to receive regulatory approval, or regulatory approval could be delayed, for many reasons, including the following:

• the FDA, EMA, or comparable regulatory authorities may not file or accept our NDA or marketing application for substantive
review;

• the FDA, EMA, or comparable regulatory authorities may disagree with the dosing regimen, design or implementation of our
clinical trials;

• the FDA, EMA, or comparable regulatory authorities may determine there is not substantial evidence of effectiveness to
support approval;

• we may be unable to demonstrate to the satisfaction of the FDA, EMA, or comparable regulatory authorities that our product
candidates are safe and effective for any of their proposed indications;

• the results of our clinical trials may not meet the level of statistical significance required by the FDA, EMA, or
comparable regulatory authorities for approval;

• we may be unable to demonstrate that our product candidates' clinical and other benefits outweigh their safety risks;

• the FDA, EMA, or comparable regulatory authorities may disagree with our interpretation of data from preclinical studies or
clinical trials;

• the data collected from clinical trials of our product candidates may not be sufficient to the satisfaction of the FDA,
EMA, or comparable regulatory authorities to support the submission of an NDA or other comparable submission in foreign jurisdictions or to obtain regulatory approval in the United States or elsewhere;

• the FDA, EMA, or comparable regulatory authorities may find deficiencies with or fail to approve the manufacturing
processes or facilities of third-party manufacturers with which we contract for clinical and commercial supplies; and

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• the approval policies or regulations of the FDA, EMA, or comparable regulatory authorities may significantly change in a
manner rendering our clinical data insufficient for approval.

***We are dependent on third parties having accurately generated, collected, interpreted and reported data from certain preclinical studies and clinical trials that were previously conducted for our product candidates.***

All of our lead product candidates were initially developed by third parties. For example, Danicamtiv was initially developed by MyoKardia and further developed by BMS Co., Ataciguat was initially developed by Sanofi and Mayo and Tonlamarsen was developed by Ionis. We in-licensed each of these product candidates pursuant to license agreements with BMS Co., Sanofi, Mayo and Ionis. We entered into these licenses on the basis of our interpretation of the medical and scientific meaningfulness of each product candidate's initial data. Therefore, we are dependent on third parties such as MyoKardia, BMS Co., Sanofi, Mayo and Ionis having designed certain preclinical studies and clinical trials; having conducted its research and development in accordance with the applicable protocols, legal and regulatory requirements, and scientific standards; having accurately reported the results of all preclinical studies conducted with respect to such product candidates; and having correctly collected and interpreted the data from these studies and trials. These risks also apply to any additional product candidates that we may acquire or in-license in the future. If these activities were not compliant, accurate or correct, the clinical development, regulatory approval or commercialization of our product candidates will be adversely affected and the earlier-reported results may not support data that we generate in our own preclinical or clinical work with those product candidates.

***Our use of the Prolaio platform to enhance clinical trial design and execution is a novel approach that may not result in the anticipated efficiencies or regulatory acceptance, which exposes us to unforeseen risks and makes it difficult for us to predict the time and cost of product development.***

A key element of our strategy is utilizing our Prolaio platform, which leverages AI-enabled tools to optimize the development of our product candidates in clinical development, including by enhancing the design and execution of our clinical trials through improved patient identification and enrollment, and continuous real world data collection. While we believe the Prolaio platform has the potential to expand patient access and accelerate patient recruitment and trial execution for our own trials and when sold to third-parties for use in third-party clinical trials, the Prolaio platform is a novel approach to trial design and execution. As a result, we are exposed to a number of unforeseen risks related to our Prolaio platform, and these risks could impact each of our product candidates. For example, digital endpoints collected through our Prolaio platform may not be accepted by the FDA as valid primary or secondary endpoints, which could require additional validation work, modification of trial design or the collection of additional clinical endpoint data, potentially delaying development timelines. The regulatory framework for digital health technologies and digitally-obtained endpoints continues to evolve. Because it is a novel approach, to date, we have not used Prolaio to support regulatory decision-making, and the use of Prolaio in our clinical trials to support regulatory decision-making for our therapeutic candidates has not yet been validated by the FDA. While our clinical studies of Danicamtiv and Ataciguat are exploring the use of Prolaio to capture eVO2peak (our novel estimate of pVO<sub>2</sub>, which is a clinically accepted measure of a patient's functional capacity derived from Cardiopulmonary Exercise Testing ("CPET")), our primary endpoint evaluates pVO<sub>2</sub> to support regulatory decision-making and we do not intend to seek approval on the basis of the eVO2peak measurements collected by Prolaio. In the future, we will need to validate Prolaio biomarkers with the FDA to be used as endpoints for a given disease. Even if validated by the FDA, we may not realize Prolaio's potential to support smaller, faster, and more capital efficient clinical trials, and it may not meet our expectations in speeding the development of our programs and increasing the probability of success.

Although our research and development efforts to date have resulted in a development portfolio of programs and product candidates, we may not be able to discover or identify additional candidates or clinical research

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that could appropriately utilize our Prolaio platform. Even if we are successful in continuing to build and expand our development portfolio, the potential product candidates that we identify may not be successful in clinical development. If we do not successfully deploy the Prolaio platform to develop and commercialize additional product candidates, we may not realize the anticipated benefits of developing and utilizing our Prolaio platform, which likely would result in significant harm to our financial position and adversely affect our stock price.

***If our clinical trials fail to replicate positive results from earlier preclinical studies or clinical trials conducted by us or third parties, we may be unable to successfully develop, obtain regulatory approval for or commercialize our product candidates.***

The results observed from preclinical studies or early-stage clinical trials of our product candidates may not necessarily be predictive of the results of later-stage clinical trials that we conduct. Similarly, positive results from such preclinical studies or early-stage clinical trials may not be replicated in our subsequent preclinical studies or clinical trials. For instance, results seen in our Phase 2 trial of Danicamtiv for DCM may not translate to similar results in our ongoing KINSHIP-DCM Phase 2b/3 clinical trial. Furthermore, our product candidates may not be able to demonstrate similar activity or adverse event profiles as other product candidates that we believe may have similar profiles.

In addition, in our ongoing and planned future clinical trials, we may utilize clinical trial designs or dosing regimens that have not been routinely tested in prior clinical trials similar to ours. For instance, our KATALYST-AV study for Ataciguat, we are exploring novel endpoints, change in valve area calcium and peak VO<sub>2</sub>, in patients with aortic stenosis. In our KINSHIP-DCM study for Danicamtiv, we are deploying an adaptive trial design where the effects observed in the Phase 2b portion of the study may impact the statistical analysis and sample size of the Phase 3 portion of the study. In our KARDINAL-ASH study for Tonlamarsen, we plan to leverage Prolaio data collection during the post-discharge period to characterize blood pressure control, blood pressure excursions and cardiovascular parameters.

There can be no assurance that any of our clinical trials will ultimately be successful or support further clinical development of any of our product candidates. There is a high failure rate for drugs proceeding through clinical trials. Many companies in the pharmaceutical and biotechnology industries have suffered significant setbacks in late-stage clinical trials after achieving positive results in early-stage development, and we cannot be certain that we will not face similar setbacks. These setbacks have been caused by, among other things, preclinical findings made while clinical trials were underway or safety or efficacy observations made in preclinical studies and clinical trials, including previously unreported adverse effects or AEs.

Additionally, we may utilize an "open-label" clinical trial design for certain of our clinical trials. For example, our Phase 2 trial for Danicamtiv was an open-label clinical trial. An "open-label" clinical trial is one where both the patient and investigator know whether the patient is receiving the investigational product candidate or either an existing approved drug or placebo. Most open-label clinical trials test only the investigational product candidate and sometimes may do so at different dose levels. Open-label clinical trials are subject to various limitations that may exaggerate any therapeutic effect as patients in open-label clinical trials are aware when they are receiving treatment. Open-label clinical trials may be subject to a "patient bias" where patients perceive their symptoms to have improved merely due to their awareness of receiving an experimental treatment. In addition, open-label clinical trials may be subject to an "investigator bias" where those assessing and reviewing the physiological outcomes of the clinical trials are aware of which patients have received treatment and may interpret the information of the treated group more favorably given this knowledge. The results from an open-label trial may not be predictive of future clinical trial results of a product candidate when studied in a controlled environment with a placebo or active control. Accordingly, data from our Phase 2 trial for Danicamtiv may not be predictive of data from our planned clinical trials for Danicamtiv.

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Moreover, preclinical and clinical data are often susceptible to varying interpretations and analyses and many companies that believed their product candidates performed satisfactorily in preclinical studies and clinical trials nonetheless failed to obtain FDA, EMA or comparable foreign regulatory authority approval.

***We intend to conduct certain clinical trials for our product candidates outside of the U.S. However, the FDA and comparable foreign regulatory authorities may not accept data from such trials, in which case our development plans will be delayed, which could materially harm our business.***

We may conduct certain clinical trials for our product candidates outside of the U.S. Although the FDA may accept data from clinical trials conducted outside the U.S., acceptance of this data is subject to certain conditions imposed by the FDA or may not be accepted at all. Where data from foreign clinical trials are intended to serve as the basis for marketing approval in the U.S., the FDA will not approve the application on the basis of foreign data alone unless those data are applicable to the U.S. population and U.S. medical practice; the studies were performed by clinical investigators of recognized competence and pursuant to GCP regulations; and the data are considered valid without the need for an on-site inspection by the FDA or, if the FDA considers such an inspection to be necessary, the FDA is able to validate the data through an on-site inspection or other appropriate means. In addition, even where the foreign study data are not intended to serve as the sole basis for approval, if the study was not otherwise subject to an IND, the FDA will not accept the data as support for an application for regulatory approval unless the study is well-designed and well-conducted in accordance with GCP requirements and the FDA is able to validate the data from the study through an onsite inspection if deemed necessary. Many foreign regulatory authorities have similar approval requirements. In addition, such foreign trials would be subject to the applicable local laws of the foreign jurisdictions where the trials are conducted.

For studies that are conducted only at sites outside of the U.S. and not subject to an IND, the FDA generally does not provide advance comment on the clinical protocols for the studies, and therefore there is an additional potential risk that the FDA could determine that the study design or protocol for a non-U.S. clinical trial was inadequate, which could require us to conduct additional clinical trials. Conducting clinical trials outside the U.S. also exposes us to additional risks, including risks associated with:

• additional foreign regulatory requirements;

• foreign exchange fluctuations;

• compliance with foreign manufacturing, customs, shipment and storage requirements;

• cultural differences in medical practice and clinical research; and

• diminished protection of intellectual property in some countries.

In addition, clinical trials conducted in one country may not be accepted by regulatory authorities in other countries, and regulatory approval in one country does not guarantee regulatory approval in any other country. We currently have clinical trial sites for Danicamtiv, Ataciguat, and Tonlamarsen outside the United States and may in the future conduct further clinical trials with one or more trial sites that are located outside the United States. Although the FDA may accept data from clinical trials conducted outside the United States, acceptance of this data is subject to conditions imposed by the FDA, and there can be no assurance that the FDA will accept data from trials conducted outside of the United States. If the FDA does not accept the data from any trial that we conduct outside the United States, it would likely result in the need for additional trials, which would be costly and time-consuming and could delay or permanently halt our development of the applicable product candidates.

***We may incur unexpected costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates.***

To obtain the requisite regulatory approvals to commercialize any of our product candidates, we must demonstrate through extensive preclinical studies and clinical trials that our product candidates are safe and effective in humans. We may experience delays in completing our clinical trials or preclinical studies and

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initiating or completing additional clinical trials or preclinical studies, including as a result of regulators not allowing or delay in allowing clinical trials to proceed under an IND or similar foreign authorization, or not approving or delaying approval for any clinical trial grant or similar approval we need to initiate a clinical trial. We may also experience numerous unforeseen events during our clinical trials that could delay or prevent our ability to receive marketing approval or commercialize the product candidates we develop, including:

• regulators, institutional review boards ("IRBs") or other reviewing bodies may not authorize us or our
investigators to commence a clinical trial, or to conduct or continue a clinical trial at a prospective or specific trial site;

• we may not reach agreement on acceptable terms with prospective CROs and clinical trial sites, the terms of which can be
subject to extensive negotiation and may vary significantly among different CROs and trial sites;

• we may experience challenges or delays in recruiting principal investigators or study sites to lead our clinical trials;

• the number of subjects or patients required for clinical trials of our product candidates may be larger than we anticipate,
enrollment in these clinical trials may be insufficient or slower than we anticipate, and the number of clinical trials being conducted at any given time may be high and result in fewer available patients for any given clinical trial, or patients
may drop out of these clinical trials at a higher rate than we anticipate;

• our third-party contractors, including those manufacturing our product candidates or conducting clinical trials on our
behalf, may fail to comply with regulatory requirements or meet their contractual obligations to us in a timely manner, or at all;

• we may have to amend clinical trial protocols submitted to regulatory authorities or conduct additional studies to reflect
changes in regulatory requirements or guidance, which may be required to resubmit to an IRB and regulatory authorities for re-examination;

• regulators or other reviewing bodies may find deficiencies with, fail to approve or subsequently find fault with the
manufacturing processes or facilities of third-party manufacturers with which we enter into agreements for clinical and commercial supplies, or the supply or quality of any product candidate or other materials necessary to conduct clinical trials of
our product candidates may be insufficient, inadequate or not available at an acceptable cost, or we may experience interruptions in supply; and

• the potential for approval policies or regulations of the FDA, EMA, or other comparable regulatory authorities to
significantly change in a manner rendering our clinical data insufficient for approval.

Clinical trials must be conducted in accordance with the FDA and other applicable regulatory authorities' legal requirements, regulations and guidelines, and remain subject to oversight by these governmental agencies and ethics committees or IRBs at the medical institutions where such clinical trials are conducted. Regulators or IRBs of the institutions in which clinical trials are being conducted may suspend, limit or terminate a clinical trial, or data monitoring committees may recommend that we suspend or terminate a clinical trial, due to a number of factors, including failure to conduct the clinical trial in accordance with regulatory requirements or our clinical protocols, inspection of the clinical trial operations or trial site by the FDA, EMA, or other comparable regulatory authorities resulting in the imposition of a clinical hold, safety issues or adverse side effects, failure to demonstrate a benefit from using a drug, changes in governmental regulations or administrative actions or lack of adequate funding to continue the clinical trial. In addition, changes in regulatory requirements and policies may occur, and we may need to amend clinical trial protocols to comply with these changes. Amendments may require us to resubmit our clinical trial protocols to regulators or to IRBs for reexamination, which may impact the costs, timing or successful completion of a clinical trial. Negative or inconclusive results from our clinical trials or preclinical studies could mandate repeated or additional clinical trials and, to the extent we choose to conduct clinical trials in other indications, could result in changes to or delays in clinical trials of our product candidates in such other indications.

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We do not know whether any clinical trials that we conduct will demonstrate adequate efficacy and safety to result in regulatory approval to market our product candidates for the indications that we are pursuing. If later-stage clinical trials do not produce favorable results, our ability to obtain regulatory approval for our product candidates will be adversely impacted.

Further, conducting clinical trials in foreign countries, as we may do for our product candidates, presents additional risks that may delay completion of our clinical trials. These risks include the failure of enrolled subjects in foreign countries to adhere to clinical protocols as a result of differences in healthcare services or cultural customs, managing additional administrative burdens associated with foreign regulatory schemes, and political and economic risks, including war, relevant to such foreign countries.

Our failure to successfully initiate and complete clinical trials and to demonstrate the efficacy and safety necessary to obtain regulatory approval to market our product candidates would significantly harm our business. Our product candidate development costs will also increase if we experience delays in testing or regulatory approvals and we may be required to obtain additional funds to complete clinical trials. We cannot assure you that our clinical trials will begin as planned or be completed on schedule, if at all, or that we will not need to restructure or otherwise modify our trials after they have begun. In addition, many of the factors that cause, or lead to, the termination, suspension of, or a delay in the commencement or completion of, clinical trials may also ultimately lead to the denial of regulatory approval of a product candidate. Significant clinical trial delays also could shorten any periods during which we may have the exclusive right to commercialize our product candidates or allow our competitors to bring products to market before we do and impair our ability to successfully commercialize our product candidates, which may harm our business, financial condition and results of operations. In addition, many of the factors that cause, or lead to, delays of clinical trials may ultimately lead to the denial of regulatory approval of our product candidates.

***Our product candidates may be associated with AEs or other undesirable properties or safety risks, which could delay or prevent their regulatory approval, cause us to suspend or discontinue clinical trials or abandon a product candidate, limit the commercial profile of an approved label, or result in significant negative consequences following regulatory approval, if obtained, or result in other significant negative consequences that could severely harm our business, financial condition, results of operations, and prospects.***

Results of our clinical trials could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics. Undesirable side effects caused by any of our product candidates could cause us or regulatory authorities to interrupt, delay or halt clinical trials and, if such product candidates are approved, could result in a more restrictive label, the inclusion of a Risk Evaluation and Mitigation Strategy, or the delay or denial of regulatory approval by the FDA, EMA, or other comparable regulatory authorities. Any treatment-related side effects could also affect patient recruitment or the ability of enrolled patients to complete the trial, or could result in potential product liability claims. Any of these occurrences may harm our business, financial condition, and prospects significantly.

We may observe safety or tolerability issues beyond those we anticipate with our current or future product candidates in ongoing or future clinical trials. Additionally, it is possible that human subjects with cardiovascular diseases may experience greater side effects in our clinical programs than observed in healthy volunteers. We continue to learn more about our product candidates, and unfavorable pharmacology profiles, including extended half-lives, could lead to adverse outcomes or concerns by the FDA, EMA, or other comparable regulatory authorities.

Many compounds that initially showed promise in clinical or earlier-stage testing are later found to cause undesirable or unexpected side effects that prevented further development of the compound. Results of future clinical trials of our product candidates could reveal a high and unacceptable severity and prevalence of side effects or unexpected characteristics, despite a favorable tolerability profile observed in earlier-stage testing.

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At any time, we may decide to terminate or greatly narrow the target population for a clinical development program due to unacceptable side effects or safety concerns.

If unacceptable side effects arise in the development of our product candidates, we, the FDA, EMA, or other comparable regulatory authorities, the IRBs, or independent ethics committees at the institutions in which our trials are conducted, could suspend, limit or terminate our clinical trials, or the independent safety monitoring committee could recommend that we suspend, limit or terminate our trials, or the FDA, EMA, or other comparable regulatory authorities could order us to cease clinical trials or deny approval of our product candidates for any or all targeted indications. We may be unable to overcome any such suspensions or holds that are placed on our clinical trials. Treatment-emergent side effects that are deemed to be drug-related could delay recruitment of clinical trial subjects or may cause subjects that enroll in our clinical trials to discontinue participation in our clinical trials. In addition, these side effects may not be appropriately recognized or managed by the treating medical staff. We may need to train medical personnel using our product candidates to understand the side effect profiles for our clinical trials and upon any commercialization of any of our product candidates. Inadequate training in recognizing or managing the potential side effects of our product candidates could result in harm to patients that are administered our product candidates. Any of these occurrences may materially adversely affect our business, financial condition, results of operations and prospects.

Moreover, clinical trials of our product candidates are conducted in carefully defined sets of patients who have agreed to enter into clinical trials. Consequently, it is possible that our clinical trials may indicate an apparent positive effect of a product candidate that is greater than the actual positive effect, if any, or alternatively fail to identify undesirable side effects.

Additionally, if any of our product candidates receives regulatory approval, and we or others later identify undesirable side effects caused by such product, a number of potentially significant negative consequences could result. For example, the FDA could require us to adopt a risk evaluation and mitigation strategy ("REMS"), to ensure that the benefits of treatment with such product candidate outweigh the risks for each potential patient, which may include, among other things, a communication plan to health care practitioners, patient education, extensive patient monitoring or distribution systems and processes that are highly controlled, restrictive, and more costly than what is typical for the industry. We or our collaborators may also be required to adopt a REMS or engage in similar actions, such as patient education, certification of health care professionals or specific monitoring, if we or others later identify undesirable side effects caused by any product that we develop alone. Other potentially significant negative consequences associated with AEs include:

• we may be required to suspend marketing of a product, or we may decide to remove such product from the marketplace;

• regulatory authorities may withdraw or change their approvals of a product;

• regulatory authorities may require additional warnings on the label or limit access of a product to selective specialized
centers with additional safety reporting and with requirements that patients be geographically close to these centers for all or part of their treatment;

• we may be required to create a medication guide outlining the risks of a product for patients, or to conduct post-marketing
studies;

• we may be required to change the way a product is administered;

• we could be subject to fines, injunctions, or the imposition of criminal or civil penalties, or be sued and held liable for
harm caused to subjects or patients; and

• a product may become less competitive, and our reputation may suffer.

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Any of these events could diminish the usage or otherwise limit the commercial success of our product candidates and prevent us from achieving or maintaining market acceptance of our product candidates, if approved by the FDA or other regulatory authorities.

***Even if we complete the necessary preclinical studies and clinical trials, the marketing approval process is expensive, time-consuming and uncertain and may prevent us from obtaining approvals for the commercialization of our product candidates.***

Any product candidate we develop and the activities associated with its development and commercialization, including its design, testing, manufacture, safety, efficacy, recordkeeping, labeling, storage, approval, advertising, promotion, sale, and distribution, are subject to comprehensive regulation by the FDA and other regulatory authorities in the United States, and by the EMA and other comparable regulatory authorities in other countries. Failure to obtain marketing approval for a product candidate will prevent us from commercializing the product candidate in a given jurisdiction. We have not received approval to market any product candidates from regulatory authorities in any jurisdiction and it is possible that none of the product candidates we are developing or may seek to develop in the future will ever obtain regulatory approval.

Our team expects to rely on third-party CROs or regulatory consultants to assist us in submitting and supporting the applications necessary to gain marketing approvals. Securing regulatory approval requires the submission of extensive preclinical and clinical data and supporting information to the various regulatory authorities for each therapeutic indication to establish the product candidate's safety and efficacy. Securing regulatory approval also requires the submission of information about the product manufacturing process to, and inspection of manufacturing facilities by, the relevant regulatory authority. Any product candidates we develop may not be effective, may be only moderately effective, or may prove to have undesirable or unintended side effects, toxicities or other characteristics that may preclude its obtaining marketing approval or prevent or limit commercial use.

The process of obtaining marketing approvals, both in the United States and abroad, is expensive, may take many years if additional clinical trials are required, if approval is obtained at all, and can vary substantially based upon a variety of factors, including the type, complexity, and novelty of the product candidates involved. Changes in marketing approval policies during the development period, changes in or the enactment of additional statutes or regulations, or changes in regulatory review for each submitted product application, may cause delays in the approval or rejection of an application. The FDA, EMA, and other comparable regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that our data are insufficient for approval and require additional preclinical, clinical or other studies. In addition, varying interpretations of the data obtained from preclinical and clinical testing could delay, limit, or prevent marketing approval of a product candidate. Any marketing approval that we may ultimately obtain could be limited or subject to restrictions or post-approval commitments that render the approved product not commercially viable.

If we experience delays in obtaining approval or if we fail to obtain approval of any product candidates we may develop, the commercial prospects for those product candidates may be harmed, and our ability to generate revenues will be materially impaired.

***Interim, topline and preliminary data from our clinical trials that we announce or publish from time to time may change as more patient data becomes available and are subject to audit and verification procedures that could result in material changes in the final data.***

From time to time, we may publish interim, topline or preliminary data from our clinical trials and preclinical studies. Such announcements or publications are typically based on a preliminary analysis of then- available data, and the results and related findings and conclusions are subject to change following a more comprehensive review of the data related to the particular study or trial. We also make assumptions, estimations, calculations, and conclusions as

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part of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the interim, topline, or preliminary results that we report may differ from future results of the same studies or trials, or different conclusions or considerations may qualify such results, once additional data have been received and fully evaluated. Topline and preliminary data also remain subject to audit and verification procedures that may result in the final data being materially different from the topline or preliminary data we previously published. As a result, topline and preliminary data should be viewed with caution until the final data are available.

Interim data from clinical trials that we may complete are further subject to the risk that one or more of the clinical outcomes may materially change as patient enrollment continues and more patient data become available. Adverse differences between interim, topline or preliminary data and final data could significantly harm our reputation and business prospects. Further, disclosure of such data by us or by our competitors could result in volatility in the price of our common stock.

Further, others, including regulatory agencies, may not accept or agree with our assumptions, estimates, calculations, conclusions, or analyses or may interpret or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization of the particular product candidate or product and our company in general. In addition, the information we choose to publicly disclose regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with what we determine is material or otherwise appropriate information to include in our disclosure, and any information we determine not to disclose may ultimately be deemed significant with respect to future decisions, conclusions, views, activities, or otherwise regarding a particular product candidate or our business. If the interim, topline, or preliminary data that we report differ from actual results, or if others, including regulatory authorities, disagree with the conclusions reached, our ability to obtain approval for, and commercialize, our product candidates may be harmed, which could harm our business, financial condition, results of operations, and prospects.

***If we do not achieve our projected development and commercialization goals in the timeframes we announce and expect, the development and commercialization of our product candidates may be delayed, and our business, financial condition and results of operations may be harmed.***

For planning purposes, we sometimes estimate the timing of the accomplishment of various scientific, clinical, regulatory and other product development objectives. These milestones may include our expectations regarding the commencement or completion of scientific studies and clinical trials, the submission of regulatory filings or commercialization objectives. From time to time, we may publicly announce the expected timing of some of these milestones, such as the completion of an ongoing clinical trial, the initiation of other clinical programs, receipt of marketing approval or a commercial launch of a product. The achievement of many of these milestones may be outside of our control. All of these milestones are based on a variety of assumptions which, if not realized as expected, may cause the timing of achievement of the milestones to vary considerably from our estimates, including:

• our available capital resources or capital constraints we experience;

• the rate of progress, costs and results of our clinical trials and research and development activities, including the
extent of scheduling conflicts with participating clinicians and collaborators;

• our ability to identify and enroll patients who meet clinical trial eligibility criteria;

• our receipt of approvals by the FDA, EMA, and other comparable regulatory authorities and the timing thereof;

• other actions, decisions or rules issued by regulators;

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• our ability to access sufficient, reliable and affordable supplies of materials used to manufacture our product candidates;

• the efforts of our collaborators with respect to the commercialization of our product candidates; and

• the securing of, costs related to, and timing issues associated with, product manufacturing as well as sales and marketing
activities.

If we fail to achieve announced milestones in the timeframes we expect, the development and commercialization of our product candidates may be delayed, and our business, financial condition and results of operations may be harmed.

***We have concentrated our research and development efforts on the treatment of cardiovascular diseases, a field that faces certain challenges in drug development.***

We have focused our research and development efforts on addressing cardiovascular diseases. Developing a product candidate for treatment of the cardiovascular diseases we currently target is extremely difficult and subjects us to a number of unique challenges, including obtaining regulatory approval from the FDA and other regulatory authorities who have only a limited set of precedents to rely on. Efforts by pharmaceutical companies in this field have faced certain challenges in drug development. In particular, cardiovascular disease conditions present similarly but stem from diverse disease biology and genetic variability. In addition, traditional clinical trials in cardiovascular diseases have resulted in large, expensive trials. Further, background medications commonly prescribed for aortic stenosis patients, such as beta blockers, may impact pulmonary function measurements and can impact our results. 

Moreover, given the history of clinical failures in this field, future clinical or regulatory failures by us or others may have resulted in further negative perception of the likelihood of success in this field, which may significantly and adversely affect the market price of our common stock. We intend to work closely with the FDA, EMA and comparable foreign regulatory authorities to perform the requisite scientific analyses and evaluation in an effort to obtain regulatory approval for our product candidates; however, the process of developing our product candidates may be more complex and time-consuming relative to other more well-known approaches to drug development. We cannot be certain that our approach will lead to the development of product candidates that effectively and safely address our target indications.

***We may be subject to additional risks because we may in the future evaluate our product candidates in combination with the standard of care for the indications that we are pursuing.***

We may in the future evaluate our product candidates in combination with other compounds, specifically the standard of care for the indications that we are pursuing. The use of our product candidates in combination with such other compounds may subject us to risks that we would not face if our product candidates were being administered as a monotherapy. The outcome and cost of developing a product candidate to be used with other compounds is difficult to predict and dependent on a number of factors that are outside our control. If we experience efficacy or safety issues in our clinical trials in which our product candidates are being administered with other compounds, we may not receive regulatory approval for our product candidates, which could prevent us from ever generating revenue or achieving profitability. 

***If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected.***

We may experience difficulties in patient enrollment in our clinical trials for a variety of reasons. The timely completion of clinical trials in accordance with our protocols depends, among other things, on our ability to enroll a sufficient number of patients who remain in the study until its conclusion.

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Patient enrollment is affected by many factors, including:

• the patient eligibility criteria defined in the protocol;

• the size of the patient population required for analysis of the trial's primary endpoints;

• the severity of the disease under investigation;

• the proximity of patients to study sites;

• the design of the trial;

• our ability to recruit clinical trial investigators with the appropriate competencies and experience;

• patients that enroll in our clinical trials may misrepresent their eligibility or may otherwise not comply with the
clinical trial protocol, resulting in the need to drop such patients from the clinical trial, increase the needed enrollment size for the clinical trial or extend the clinical trial's duration;

• approval of new indications for existing therapies or approval of new therapies in general;

• competing clinical trials and clinicians' and patients' perceptions as to the potential advantages and risks of
the product candidate being studied in relation to other available therapies, including any new drugs that may be approved for the indications that we are investigating;

• our ability to obtain and maintain patient consents; and

• the risk that patients enrolled in our clinical trials will drop out of the trials before completion.

We may experience challenges in recruiting principal investigators and patients to participate in ongoing and future clinical trials for such product candidates if we are unable to sufficiently demonstrate the potential of such product candidates to them. In addition, our clinical trials may compete with other clinical trials for product candidates that are in the same therapeutic areas as our product candidates, and this competition will reduce the number and types of patients available to us, because some patients who might have opted to enroll in our trials may instead opt to enroll in a trial being conducted by one of our competitors. Since the number of qualified clinical investigators is limited, we may conduct some of our clinical trials at the same clinical trial sites that some of our competitors use, which will reduce the number of patients who are available for our clinical trials in such clinical trial site. Our trials also include procedures, such as pulmonary function tests via CPET, that may be burdensome for patients and could hinder enrollment. In addition, we are pursuing novel or smaller indications, including ASH and genetic DCM, which may further affect our ability to enroll patients in our clinical studies. Furthermore, if significant AEs or other side effects are observed in any of our clinical trials, we may have difficulty recruiting patients to our trials and patients may drop out of our trials. Additionally, patients, including patients in any control groups, may withdraw from the clinical trial for various reasons, including but not limited to if they are not experiencing improvement in their underlying disease or condition, or if they experience other difficulties or issues relating to their underlying disease or condition. Withdrawal of patients from our clinical trials may compromise the quality of our data.

Our inability to enroll a sufficient number of patients for our clinical trials would result in significant delays or might require us to abandon one or more clinical trials or our development efforts altogether. Delays in patient enrollment may result in increased costs, affect the timing or outcome of the planned clinical trials, product candidate development and approval process and jeopardize our ability to seek and obtain the regulatory approval required to commence product sales and generate revenue, which could prevent completion of these trials, adversely affect our ability to advance the development of our product candidates, cause our value to decline and limit our ability to obtain additional financing if needed.

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***The number of patients with certain cardiovascular diseases for which we are developing our product candidates has not been established with precision. If the actual number of patients with the diseases we elect to pursue with our product candidates is smaller than we anticipate, we may have difficulties in enrolling patients in our clinical trials, which may delay or prevent development of our product candidates. Even if such product candidates are successfully developed and approved, the markets for our product candidates may be smaller than we expect and our revenue potential and ability to achieve profitability may be materially adversely affected.***

Our pipeline includes product candidates for a number of cardiovascular diseases. There is no precise method of establishing the actual number of patients with any of these diseases in any geography over any time period. With respect to many of the indications in which we have developed, are developing, or plan to develop our product candidates, we have estimates of the prevalence of the disease. Our estimates as to prevalence may not be accurate, and the actual prevalence or addressable patient population for some or all of those indications, or any other indication that we elect to pursue, may be significantly smaller than our estimates. In estimating the potential prevalence of indications we are pursuing, or may in the future pursue, including our estimates as to the prevalence of cardiovascular disease, we apply assumptions to available information that may not prove to be accurate. In each case, there is a range of estimates in the published literature and in marketing studies, which include estimates within the range that are lower than our estimates. The actual number of patients with these disease indications may, however, be significantly lower than we believe. Even if our prevalence estimates are correct, our product candidates may be developed for only a subset of patients with the relevant disease or our product candidates, if approved, may be indicated for or used by only a subset. In the event the number of patients with the cardiovascular diseases we are studying is significantly lower than we expect, we may have difficulties in enrolling patients in our clinical trials, which may delay or prevent development of our product candidates. If any of our product candidates are approved and our prevalence estimates with respect to any indication or our other market assumptions are not accurate, the markets for our product candidates for these indications may be smaller than we anticipate, which could limit our revenues and our ability to achieve profitability or to meet our expectations with respect to revenues or profits.

***Even if any of our product candidates receives regulatory approval, it may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success, in which case we may not generate significant revenues or become profitable.***

We have never commercialized a product, and even if any of our product candidates is approved by the appropriate regulatory authorities for marketing and sale, it may nonetheless fail to achieve sufficient market acceptance by physicians, patients, third-party payors and others in the medical community. The commercial success of any of our product candidates will depend significantly on the broad adoption and use of the resulting product by these individuals and organizations for approved indications.

Even if our product candidates are successful in registrational clinical trials, they may not be successful in achieving market acceptance by physicians, patients, or third-party payors for addition to current standards of care if we are unable to demonstrate superior efficacy, safety, ease of administration and/or cost-effectiveness when prescribing our product candidates in addition to current standard of care treatments as add-on therapies. For example, physicians may be reluctant to add to their patients' current medications and adjust their treatment regimen for a variety of reasons. Further, patients often acclimate to the treatment regimen that they are currently taking and do not want to add-on additional treatments unless their physicians recommend doing so or are required to do so due to inadequate coverage or reimbursement by third-party payors. Even if we are able to demonstrate our product candidates' safety and efficacy to the FDA and other regulators, we may be unable to demonstrate to physicians, patients, or third-party payors the benefits of adding-on our product candidates or safety or efficacy concerns regarding our product candidates in the medical community may hinder market acceptance.

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Efforts to educate the medical community and third-party payors on the benefits of our product candidates as add-on therapies may require significant resources, including management time and financial resources, and may not be successful. If any product candidate is approved but does not achieve an adequate level of market acceptance, we may not generate significant revenues and we may not become profitable. The degree of market acceptance of our product candidates, if approved for commercial sale, will depend on a number of factors, including:

• the efficacy and safety of the product, including as compared to any more-established products or other alternative
products that may later be approved;

• the potential advantages of the product compared to standard of care alone or competitive therapies;

• the indications for which the product is approved, if any;

• the prevalence and severity of any side effects;

• whether the product is designated under physician treatment guidelines as a first-, second- or third-line therapy;

• our ability, or the ability of any future collaborators, to offer the product for sale at competitive prices;

• the product's convenience and ease of administration compared to alternative treatments;

• the willingness of the target patient population to try, and of physicians to prescribe, the product;

• the willingness of patients to pay all, or a portion of, out-of-pocket costs associated with the product in the absence of sufficient third-party coverage and adequate reimbursement;

• the product's acceptance into standard of care treatment algorithms by medical societies as add-on treatments that could limit payor and physician uptake;

• limitations or warnings, including distribution or use restrictions contained in the product's approved labeling;

• the strength of sales, marketing and distribution support;

• changes in the standard of care for the targeted indications for the product;

• availability and adequacy of coverage and reimbursement from government payors, managed care plans and other third-party
payors, including any price concessions required by third-party payors to obtain coverage;

• potential product liability claims; and

• unfavorable publicity relating to the product, or favorable publicity about competitive products.

Any failure by one or more of our product candidates that obtains regulatory approval to achieve market acceptance or commercial success would adversely affect our business prospects.

***If we fail to discover, develop and commercialize additional product candidates, we may be unable to grow our business and our ability to achieve our strategic objectives would be impaired.***

Although the development and commercialization of our current product candidates are our initial focus, as part of our longer-term growth strategy, we plan to develop other product candidates. In addition to the product candidates in our clinical-stage pipeline, we have additional assets that are in earlier stages of development, such as KAR-141, which is licensed from BMS Co. We intend to evaluate internal opportunities

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from our existing product candidates or other potential product candidates, and also may choose to in-license or acquire other product candidates to treat patients suffering from other disorders with significant unmet medical needs and limited treatment options. These other potential product candidates will require additional, time-consuming development efforts prior to commercial sale, including preclinical studies, clinical trials and approval by the FDA, EMA, or other comparable regulatory authorities. All product candidates are prone to the risks of failure that are inherent in pharmaceutical product development, including the possibility that the product candidate will not be shown to be sufficiently safe and effective for approval by regulatory authorities. In addition, we cannot assure you that any such products that are approved will be manufactured or produced economically, successfully commercialized or widely accepted in the marketplace or be more effective than other commercially available alternatives.

In addition, we intend to devote substantial capital and resources for basic research to discover and identify additional product candidates. These research programs require substantial technical, financial and human resources, whether or not any product candidates are ultimately identified. Our research programs may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development for many reasons, including the following:

• the research methodology used may not be successful in identifying potential product candidates;

• competitors may develop alternatives that render our product candidates obsolete;

• product candidates that we develop may nevertheless be covered by third parties' patents or other exclusive rights;

• a product candidate may, on further study, be shown to have harmful side effects or other characteristics that indicate it
is unlikely to be effective or otherwise does not meet applicable regulatory criteria;

• a product candidate may not be capable of being produced in commercial quantities at an acceptable cost, or at all; and

• a product candidate may not be accepted as safe and effective by patients, the medical community or third-party payors.

In the future, we may also seek to in-license or acquire product candidates or the underlying technology. The process of proposing, negotiating and implementing a license or acquisition is lengthy and complex. Other companies, including some with substantially greater financial, marketing and sales resources, may compete with us for the license or acquisition of product candidates. We have limited resources to identify and execute the acquisition or in-licensing of third-party products, businesses and technologies and integrate them into our current infrastructure. Moreover, we may devote resources to potential acquisitions or in-licensing opportunities that are never completed, or we may fail to realize the anticipated benefits of such efforts. We may not be able to acquire the rights to additional product candidates on terms that we find acceptable, or at all.

In addition, future acquisitions may entail numerous operational and financial risks, including:

• exposure to unknown liabilities;

• disruption of our business and diversion of management's time and attention to develop acquired products or
technologies;

• incurrence of substantial debt, dilutive issuances of securities or depletion of cash to pay for acquisitions;

• higher than expected acquisition and integration costs;

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• difficulty in combining the operations and personnel of any acquired businesses with our operations and personnel;

• increased amortization expenses;

• impairment of relationships with key suppliers or customers of any acquired businesses due to changes in management and
ownership; and

• inability to motivate key employees of any acquired businesses.

If we are unsuccessful in identifying and developing additional product candidates, either through internal development or licensing or acquisition from third parties, our potential for growth and achieving our strategic objectives may be impaired.

***Competitive products may reduce or eliminate the commercial opportunity for our product candidates, if approved. If our competitors develop technologies or product candidates more rapidly than we do, or their technologies or product candidates are more effective or safer than ours, our ability to develop and successfully commercialize our product candidates may be adversely affected.***

The clinical and commercial landscapes for the treatment of cardiovascular diseases are highly competitive and subject to rapid and significant scientific and technological change. We face competition with respect to our indications for our product candidates and will face competition with respect to any other drug candidates that we may seek to develop or commercialize in the future, from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide. There are a number of large pharmaceutical and biotechnology companies that are pursuing the development of drug candidates for the treatment of the indications that we are pursuing. Potential competitors also include academic institutions, government agencies and other public and private research organizations that conduct research, seek patent protection and establish collaborative arrangements for research, development, manufacturing and commercialization.

We are aware that a significant number of product candidates are currently under development for the same indications that we are currently pursuing and may pursue, and some or all may become commercially available in the future for the treatment of conditions for which we are trying or may try to develop product candidates. See the section titled "*Business—Competition*" included elsewhere in this prospectus for examples of the competition that our product candidates face.

We do not currently plan to run head-to-head clinical trials evaluating our product candidates against the current standards of care, which may make it more challenging for our product candidates to compete against the current standards of care due to the lack of head-to-head clinical trial data.

Our competitors may have significantly greater financial resources, established presence in the market, expertise in research and development, manufacturing, preclinical and clinical testing, obtaining regulatory approvals and reimbursement and marketing approved products than we do. Accordingly, our competitors may be more successful than we may be in obtaining regulatory approval for therapies and achieving widespread market acceptance. Our competitors' products may be more effective, or more effectively marketed and sold, than any product candidate we may commercialize and may render our therapies obsolete or non-competitive before we can recover development and commercialization expenses. If any of our product candidates are approved, it could compete with a range of therapeutic treatments that are in development. In addition, our competitors may succeed in developing, acquiring or licensing technologies and drug products that are more effective or less costly than our product candidates, which could render our product candidates obsolete and noncompetitive.

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If we obtain approval for any of our product candidates, we may face competition based on many different factors, including the efficacy, safety and tolerability of our products, the ease with which our products can be administered, the timing and scope of regulatory approvals for these products, the availability and cost of manufacturing, marketing and sales capabilities, price, reimbursement coverage and patent position. Existing and future competing products could present superior treatment alternatives, including being more effective, safer, less expensive or marketed and sold more effectively than any products we may develop. Competitive products may make any products we develop obsolete or noncompetitive before we recover the expense of developing and commercializing our product candidates. Such competitors could also recruit our employees, which could negatively impact our level of expertise and our ability to execute our business plan.

In addition, our competitors may obtain patent protection, regulatory exclusivities or FDA approval and commercialize products more rapidly than we do, which may impact future approvals or sales of any of our product candidates that receive regulatory approval. If the FDA approves the commercial sale of any product candidate, we will also be competing with respect to marketing capabilities and manufacturing efficiency. We expect competition among products will be based on product efficacy and safety, the timing and scope of regulatory approvals, availability of supply, marketing and sales capabilities, product price, reimbursement coverage by government and private third-party payors, regulatory exclusivities and patent position. Our profitability and financial position will suffer if our product candidates receive regulatory approval but cannot compete effectively in the marketplace.

Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources being concentrated among a smaller number of our competitors. Smaller and other early-stage companies may also prove to be significant competitors, particularly through collaborative arrangements with large and established companies. These third parties compete with us in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites, as well as in acquiring technologies complementary to, or necessary for, our programs.

***If we are unable to develop our sales, marketing and distribution capability on our own or through collaborations with marketing partners, we will not be successful in commercializing our product candidates.***

We currently have no marketing, sales or distribution capabilities for our product candidates. We intend to establish a sales and marketing organization, either on our own or in collaboration with third parties, with technical expertise and supporting distribution capabilities to commercialize one or more of our product candidates that may receive regulatory approval in key territories. These efforts will require substantial additional resources, some or all of which may be incurred in advance of any approval of the product candidate. Any failure or delay in the development of our or third parties' internal sales, marketing and distribution capabilities would adversely impact the commercialization of our product candidates.

Factors that may inhibit our efforts to commercialize our product candidates on our own include:

• our inability to recruit and retain adequate numbers of effective sales and marketing personnel, at an acceptable cost, or
at all;

• the inability of sales personnel to obtain access to or our failure to educate an adequate number of physicians on the
benefits of any future products;

• the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage
relative to companies with more extensive product lines; and

• unforeseen costs and expenses associated with creating an independent sales and marketing organization.

With respect to our existing and future product candidates, we may choose to collaborate with third parties that have direct sales forces and established distribution systems to serve as an alternative to our own sales force

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and distribution systems. Our future product revenue may be lower than if we directly marketed or sold our product candidates, if approved. In addition, any revenue we receive will depend in whole or in part upon the efforts of these third parties, which may not be successful and are generally not within our control. If we are not successful in commercializing any approved products, our future product revenue will suffer and we may incur significant additional losses.

There can be no assurance that we will be able to develop in-house sales and distribution capabilities or establish or maintain relationships with third-party collaborators to commercialize any product in the United States or overseas. If we do not establish sales and marketing capabilities successfully, either on our own or in collaboration with third parties, we will not be successful in commercializing our product candidates.

**Risks related to employee matters and managing growth** 

***We expect to expand our organization, and as a result, we may encounter difficulties in managing our growth, which could disrupt our operations.***

We expect to experience significant growth in the number of our employees and the scope of our operations, particularly in the areas of regulatory affairs and sales, marketing and distribution, as well as to support our public company operations. To manage these growth activities, we must continue to implement and improve our managerial, operational, quality and financial systems, expand our facilities and continue to recruit and train additional qualified personnel. As we grow, including through the potential establishment of operations in additional geographic locations, we may face increased complexity in our organizational structure and greater challenges in maintaining effective oversight, communication and alignment across functions and locations. Our management may need to devote a significant amount of its attention to managing these growth activities. Due to our limited financial resources and the limited experience of our management team in managing a company with such anticipated growth, we may not be able to effectively manage the expansion of our operations, retain key employees, or identify, recruit and train additional qualified personnel. Our inability to manage the expansion of our operations effectively may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Our expected growth could also require significant capital expenditures and may divert financial resources from other projects, such as the development of additional product candidates. If we are unable to effectively manage our expected growth, our expenses may increase more than expected, our ability to generate revenues could be reduced and we may not be able to implement our business strategy, including the successful commercialization of our product candidates.

***Our ability to develop product candidates and leverage our Prolaio platform and our future growth depends on attracting, hiring and retaining our key personnel and recruiting additional qualified personnel.***

Our success depends upon the continued contributions of our key management and scientific personnel, many of whom have been instrumental for us and have substantial experience with developing therapies, identifying potential product candidates and building the technologies related to the clinical development of our product candidates. Given the specialized nature of cardiovascular diseases and our approach, there is an inherent scarcity of experienced personnel in these fields. As we continue developing our product candidates in our pipeline and advance our Prolaio platform, we will require personnel with medical, scientific, or technical qualifications specific to each program. The loss of key personnel, in particular our Chief Executive Officer, Co-Founder and Chair of the Board, Chief Medical Officer, clinical development personnel and key employees at Prolaio, would delay our research and development activities. We currently do not have "key person" insurance on any of our employees. Despite our efforts to retain valuable employees, members of our team may terminate their employment with us on short notice. The competition for qualified personnel in the biotechnology, biopharmaceutical and digital health industries is intense, and our future success depends upon

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our ability to attract, retain, and motivate highly skilled scientific, technical and managerial employees. We face competition for personnel from other companies, universities, public and private research institutions, and other organizations. If our recruitment and retention efforts are unsuccessful in the future, it may be difficult for us to implement our business strategy, which would have a material adverse effect on our business.

In addition, our clinical operations and research and development programs depend on our ability to attract and retain highly skilled scientists, data scientists, and engineers, particularly in New Jersey, California, and Illinois. There is powerful competition for skilled personnel in these geographical markets, and we have from time to time experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications on acceptable terms, or at all. Many of the companies with which we compete for experienced personnel have greater resources than we do, and any of our employees may terminate their employment with us at any time. If we hire employees from competitors or other companies, their former employers may attempt to assert that these employees or we have breached legal obligations, resulting in a diversion of our time and resources and, potentially, damages. In addition, job candidates and existing employees often consider the value of the stock awards they receive in connection with their employment. If the perceived benefits of our stock awards decline, it may harm our ability to recruit and retain highly skilled employees. The need to attract and retain talent across both traditional biopharmaceutical functions and digital health and technology functions increases the complexity of our recruiting and retention efforts. If we fail to attract new personnel or fail to retain and motivate our current personnel, our business and future growth prospects would be harmed.

**Risks related to our dependence on third parties** 

***We rely on third parties to assist in conducting our clinical trials. If they do not perform satisfactorily, we may not be able to obtain regulatory approval or commercialize our product candidates, or such approval or commercialization may be delayed, and our business could be substantially harmed.***

We have relied upon and plan to continue to rely on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators, vendors to conduct our clinical trials and expect to rely on these third parties to conduct clinical trials of any other product candidates that we develop. Our ability to complete clinical trials in a timely fashion depends on a number of key factors. These factors include contract negotiation, protocol design, regulatory and IRB approval, site activation, budget negotiation, patient enrollment rates and compliance with GCPs. We have opened clinical trial sites and are enrolling patients in a number of countries where our experience is limited. In most cases, we use the services of third parties, including CROs, to carry out our clinical trial-related activities and rely on such parties to accurately report their results. Our reliance on third parties for clinical development activities may impact or limit our control over the timing, conduct, expense and quality of our clinical trials. If we are unable to successfully contract with or have to terminate and establish alternative service provider, or site contractual relationships with any parties involved in or supporting our product candidate development activities, our clinical development could experience delays or be otherwise adversely impacted. Moreover, the FDA requires us to comply with GCPs for conducting, recording and reporting the results of clinical trials to assure that data and reported results are credible and accurate and that the rights, integrity and confidentiality of trial participants are protected. The FDA enforces these GCPs through periodic inspections of clinical trial sponsors, principal investigators, clinical trial sites and IRBs. For certain commercial prescription drug products, manufacturers and other parties involved in the supply chain must also meet chain of distribution requirements and build electronic, interoperable systems for product tracking and tracing and for notifying the FDA of counterfeit, diverted, stolen and intentionally adulterated products or other products that are otherwise unfit for distribution in the United States.

We remain responsible for ensuring that each of our trials is conducted in accordance with the applicable protocol, legal and regulatory requirements and scientific standards. Our failure or the failure of third parties to

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comply with the applicable protocol, legal and regulatory requirements and scientific standards can result in rejection of our clinical trial data or other sanctions. If we or our third-party clinical trial providers, vendors or third-party CROs do not successfully carry out these clinical activities, our clinical trials or the potential regulatory approval of a product candidate may be delayed or be unsuccessful. Additionally, if we or our third-party contractors fail to comply with applicable GCPs for any reason, the clinical data generated in our clinical trials may be deemed unreliable and the FDA may require us to perform additional clinical trials before approving our product candidates, which would delay the regulatory approval process. We cannot be certain that, upon inspection, the FDA will determine that any of our clinical trials comply with GCPs. We are also required to register certain clinical trials and post the results of completed clinical trials on a government-sponsored database, ClinicalTrials.gov, within certain timeframes. Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.

Furthermore, the third parties conducting clinical trials on our behalf are not our employees, and except for remedies available to us under our agreements with such contractors, we cannot control whether or not they devote sufficient time, skill and resources to our ongoing development programs. Moreover, many CROs, including some of those that we have engaged to conduct our clinical trials, are experiencing enrollment challenges as a result of, among other things, high employee turnover driven by the post-COVID macroeconomic environment and the inexperience of new employees. Additionally, at clinical trial sites, the availability of staff and trial participants has been limited. These contractors may also have relationships with other commercial entities, including our competitors, for whom they may also be conducting clinical trials or other drug development activities, which could impede their ability to devote appropriate time to our clinical programs. If these third parties, including clinical investigators, do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical trials in accordance with regulatory requirements or our stated protocols, we may not be able to obtain, or may be delayed in obtaining, regulatory approvals for our product candidates. If that occurs, we will not be able to, or may be delayed in our efforts to, successfully commercialize our product candidates. In such an event, our financial results and the commercial prospects for any product candidates that we seek to develop could be harmed, our costs could increase and our ability to generate revenues could be delayed, impaired or foreclosed.

We also rely on other third parties to store and distribute drug supplies for our clinical trials. Any performance failure on the part of our distributors could delay clinical development or regulatory approval of our product candidates or commercialization of any resulting products, producing additional losses and depriving us of potential product revenue.

Any of the third-party organizations we utilize may terminate their engagements with us under certain circumstances. The replacement of an existing CRO or other third party may result in the delay of the affected trials or otherwise adversely affect our efforts to obtain regulatory approvals and commercialize our product candidates. We may not be able to enter into alternative arrangements or do so on commercially reasonable terms. In addition, even if there are suitable replacements for one or more of these service providers, there is a natural transition period when a new service provider begins work. As a result, delays may occur, which could negatively impact our ability to meet our expected clinical development timelines and harm our business, financial condition and prospects.

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delay in approval, or rejection, of our marketing applications by the FDA and may ultimately lead to the denial of regulatory approval of one or more of our product candidates.

***Our use of third parties to manufacture our product candidates, including those located outside of the United States in jurisdictions such as Europe, Canada and China, may increase the risk that we will not have sufficient quantities of our product candidates, raw materials, active pharmaceutical ingredients ("APIs") or drug products when needed or at an acceptable cost.***

We do not own or operate manufacturing facilities for the production of clinical or commercial quantities of our product candidates, and we lack the resources and the capabilities to do so. Our current strategy is to outsource all manufacturing of our product candidates to third parties, including in jurisdictions outside of the United States such as Germany, Switzerland, Canada and China.

We currently rely on and engage third-party manufacturers to provide all of the API and the final drug product formulation of all of our product candidates that are being used in our clinical trials and preclinical studies. If we were to need an alternate manufacturer, we would incur added costs and delays in identifying and qualifying any such replacement. In addition, we typically order raw materials, API and drug product and services on a purchase order basis and do not enter into long-term dedicated capacity or minimum supply arrangements with any commercial manufacturer. We may not be able to timely secure needed supply arrangements on satisfactory terms, or at all. Our failure to secure these arrangements as needed could have a material adverse effect on our ability to complete the development of our product candidates or, to commercialize them, if approved. We may be unable to conclude agreements for commercial supply with third-party manufacturers or may be unable to do so on acceptable terms. There may be difficulties in scaling up to commercial quantities and formulation of our product candidates, and the costs of manufacturing could be prohibitive.

Many of the third-party manufacturers we rely on have only recently begun working with us and have limited or no experience manufacturing our API and final drug products. These third-party manufacturers are subject to cGMP compliance requirements of the FDA, EMA, and other comparable regulatory authorities where our product candidates may be shipped. If our manufacturers have difficulty or suffer delays in successfully manufacturing material that meets our specifications, it may limit supply of our product candidates, delay our initiation of clinical trial activities in jurisdictions where the requirements to supply clinical product have not been satisfactorily demonstrated, and could delay our clinical trials. 

Even if we are able to establish and maintain arrangements with third-party manufacturers, reliance on third-party manufacturers entails additional risks, including:

• the failure of the third-party manufacturer to comply with applicable regulatory requirements and reliance on third parties
for manufacturing process development, regulatory compliance and quality assurance;

• manufacturing delays if our third-party manufacturers give greater priority to the supply of other products over our
product candidates or otherwise do not satisfactorily perform according to the terms of the agreement between us;

• limitations on supply availability resulting from capacity and scheduling constraints of third parties;

• the failure of the third-party manufacturer to produce materials with acceptable quality on a larger scale;

• the possible breach of manufacturing agreements by third parties because of factors beyond our control;

• the possible termination or non-renewal of the manufacturing agreements by the
third party, at a time that is costly or inconvenient to us; and

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• the possible misappropriation of our proprietary information, including our trade secrets and know-how.

If we do not maintain our key manufacturing relationships, we may fail to find replacement manufacturers or fail to find them on favorable contractual terms, or fail to develop our own manufacturing capabilities, which could delay or impair our ability to obtain regulatory approval for our product candidates. If we do find replacement manufacturers, we may not be able to enter into agreements with them on terms and conditions favorable to us and there could be a substantial delay before new facilities could be qualified and registered with the FDA, EMA, and other comparable regulatory authorities.

Additionally, if any third-party manufacturer with whom we contract fails to perform its obligations, we may be forced to manufacture the materials ourselves, for which we may not have the capabilities or resources, or enter into an agreement with a different manufacturer. In either scenario, our clinical trials supply could be delayed significantly as we establish alternative supply sources. In some cases, the technical skills required to manufacture our product candidates may be unique or proprietary to the original manufacturer and we may have difficulty, or there may be contractual restrictions prohibiting us from, transferring such skills to a back-up or alternate supplier, or we may be unable to transfer such skills at all. In addition, if we are required to change third-party manufacturers for any reason, we will be required to verify that the new manufacturer maintains facilities and procedures that comply with quality standards and with all applicable regulations. We will also need to verify, such as through a manufacturing comparability study, that any new manufacturing process will produce our product candidate according to the specifications previously submitted to the FDA, EMA, or other comparable regulatory authorities. We may be unsuccessful in demonstrating the comparability of clinical supplies, which could require the conduct of additional clinical trials. The delays associated with the verification of a new third-party manufacturer could negatively affect our ability to develop product candidates or commercialize our products in a timely manner or within budget. Furthermore, a third-party manufacturer may possess technology related to the manufacture of our product candidate that such third party owns independently. This would increase our reliance on such third-party manufacturer or require us to obtain a license from such third-party manufacturer in order to have another third party manufacture our product candidates.

If any of our product candidates is approved by any regulatory agency, we intend to utilize arrangements with third-party contract manufacturers for the commercial production of those products. This process is difficult and time consuming and we may face competition for access to manufacturing facilities as there are a limited number of contract manufacturers operating under cGMPs that are capable of manufacturing our product candidates. Consequently, we may not be able to reach agreement with third-party manufacturers on satisfactory terms, which could delay our commercialization.

Some of our manufacturers are located outside of the United States, including in China. There is currently significant uncertainty about the future relationship between the United States and various other countries, including China, with respect to trade policies, treaties, government regulations and tariffs. Increased tariffs or pending legislation that would impose federal contracting or federal funding limitations on parties directly using or connected to those using the services or equipment of certain foreign entities with known or alleged associations with foreign adversaries could potentially disrupt our existing supply chains and impose additional costs on our business. Given the unpredictable regulatory environment in China and the United States and uncertainty regarding how the U.S. or foreign governments will act with respect to tariffs, international trade agreements and policies, further governmental action related to tariffs, litigation of tariffs in U.S. federal courts, additional taxes, contracting matters, regulatory changes or other retaliatory trade measures in the future could occur with a corresponding detrimental impact on our business and financial condition.

Our failure, or the failure of our third-party manufacturers, to comply with applicable regulations could result in sanctions being imposed on us, including clinical holds, fines, injunctions, civil penalties, delays, suspension or

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withdrawal of approvals, seizures or voluntary recalls of product candidates, operating restrictions and criminal prosecutions, any of which could significantly affect supplies of our product candidates. The facilities used by our contract manufacturers to manufacture our product candidates must be evaluated by the FDA. We do not control the manufacturing process of, and are completely dependent on, our contract manufacturing partners for compliance with cGMPs. If our contract manufacturers cannot successfully manufacture material that conforms to our specifications and the strict regulatory requirements of the FDA, EMA, or other comparable regulatory authorities, we may not be able to secure and/or maintain regulatory approval for our product candidates manufactured at these facilities. In addition, we have no control over the ability of our contract manufacturers to maintain adequate quality control, quality assurance and qualified personnel. If the FDA finds deficiencies or a comparable foreign regulatory authority does not approve these facilities for the manufacture of our product candidates or if it withdraws any such approval in the future, we may need to find alternative manufacturing facilities, which would significantly impact our ability to develop, obtain regulatory approval for or market our product candidates, if approved. Contract manufacturers may face manufacturing or quality control problems causing drug substance production and shipment delays or a situation where the contractor may not be able to maintain compliance with the applicable cGMP requirements. Any failure to comply with cGMP requirements or other FDA, EMA and comparable foreign regulatory requirements could adversely affect our clinical research activities and our ability to develop our product candidates and market our products, if approved.

The FDA, EMA, or other comparable regulatory authorities require manufacturers to register manufacturing facilities, and also inspect these facilities to confirm compliance with cGMPs.

Contract manufacturers may face manufacturing or quality control problems causing drug substance production and shipment delays or a situation where the contractor may not be able to maintain compliance with the applicable cGMP requirements. Any failure to comply with cGMP requirements or other FDA, EMA, and other comparable regulatory requirements could adversely affect our clinical research activities and our ability to develop our product candidates and market our products following approval, if obtained.

Furthermore, should we decide to use any APIs in any of our product candidates that are proprietary to one or more third parties, we would need to maintain licenses to those APIs from those third parties. If we are unable to gain or continue to access rights to such APIs prior to conducting preclinical toxicology studies intended to support clinical trials, we may need to develop alternate product candidates from these programs by either accessing or developing alternate APIs, resulting in increased development costs and delays in commercialization of these product candidates. If we are unable to gain or maintain continued access rights to the desired APIs on commercially reasonable terms or develop suitable alternate APIs, we may not be able to commercialize product candidates from these programs.

***We may seek to establish collaborations and, if we are not able to establish them on commercially reasonable terms, we may have to alter our development and commercialization plans.***

We may plan to opportunistically pursue strategic partnerships, as the advancement of our product candidates and development programs and the potential commercialization of our current and future product candidates will require substantial additional cash to fund expenses. If we believe that partnerships can accelerate the development or maximize the market potential of our product candidates, we will consider entering into product, target and/or geographic specific strategic partnerships on an opportunistic basis. Likely collaborators may include large and mid-size pharmaceutical companies, regional and national pharmaceutical companies and biotechnology companies. In addition, if we are able to obtain regulatory approval for product candidates from foreign regulatory authorities, we may enter into partnerships or collaborations with international biotechnology or pharmaceutical companies for the commercialization of such product candidates.

We face significant competition in seeking appropriate collaborators. Whether we reach a definitive agreement for a partnership or collaboration will depend, among other things, upon our assessment of the collaborator's

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resources and expertise, the terms and conditions of the proposed partnerships or collaboration and the proposed collaborator's evaluation of a number of factors. Those factors may include the potential differentiation of our product candidate from competing product candidates, design or results of clinical trials, the likelihood of approval by the FDA, EMA, or other comparable regulatory authorities and the regulatory pathway for any such approval, the potential market for the product candidate, the costs and complexities of manufacturing and delivering the product to patients and the potential of competing products. The collaborator may also consider alternative product candidates or technologies for similar indications that may be available for partnership or collaboration and whether such a partnership or collaboration could be more attractive than the one with us for our product candidate. If we elect to increase our expenditures to fund development or commercialization activities on our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all. If we do not have sufficient funds, we may not be able to further develop our product candidates or bring them to market and generate product revenue.

Partnerships and collaborations are each complex and time-consuming to negotiate and document. Further, there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in a reduced number of potential future collaborators. Any partnership or collaboration agreements that we enter into in the future may contain restrictions on our ability to enter into potential partnerships or collaborations or to otherwise develop specified product candidates. We may not be able to negotiate partnerships or collaborations on a timely basis, on acceptable terms, or at all. If we are unable to do so, we may have to curtail the development of the product candidate for which we are seeking to collaborate, reduce or delay its development program or one or more of our other development programs, delay its potential commercialization or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization activities at our own expense.

Furthermore, if conflicts arise between our collaborators and us, the other party may act in a manner adverse to us and could limit our ability to implement our strategies. Our collaborators could conduct multiple product development efforts and could develop, either alone or with others, products in related fields that are competitive with the product candidates we may develop that are the subject of these partnerships or collaborations with us.

Competing products may preclude us from entering into partnerships or collaborations with their competitors, fail to obtain timely regulatory approvals, prevent us from obtaining timely regulatory approvals, terminate their agreements with us prematurely or fail to devote sufficient resources to the partnership or collaboration efforts, including development, delivery, manufacturing and commercialization of products. Any of these developments could harm our company and product development efforts.

***If we enter into collaborations with third parties for the development and commercialization of our product candidates, our prospects with respect to those product candidates will depend in significant part on the success of those collaborations.***

We may enter into collaborations for the development and commercialization of certain of our product candidates. If we enter into such collaborations, we will have limited control over the amount and timing of resources that our collaborators will dedicate to the development or commercialization of our product candidates. Our ability to generate revenues from these arrangements will depend on any future collaborators' abilities to successfully perform the functions assigned to them in these arrangements. In addition, any future collaborators may have the right to abandon research or development projects and terminate applicable agreements, including funding obligations, prior to or upon the expiration of the agreed upon terms.

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Collaborations involving our product candidates pose a number of risks, including the following:

• collaborators have significant discretion in determining the efforts and resources that they will apply to these
collaborations;

• collaborators may not perform their obligations as expected;

• collaborators may not pursue development and commercialization of our product candidates or may elect not to continue or
renew development or commercialization programs, based on clinical trial results, changes in the collaborators' strategic focus or available funding or external factors, such as an acquisition, which divert resources or create competing
priorities;

• collaborators may delay clinical trials, provide insufficient funding for a clinical trial program, stop a clinical trial
or abandon a product candidate, repeat or conduct new clinical trials or require a new formulation of a product candidate for clinical testing;

• collaborators could independently develop, or develop with third parties, products that compete directly or indirectly with
our product candidates;

• a collaborator with marketing and distribution rights to one or more products may not commit sufficient resources to the
marketing and distribution of such product or products;

• disagreements with collaborators, including disagreements over proprietary rights, including trade secrets and intellectual
property rights, contract interpretation, or the preferred course of development might cause delays or termination of the research, development or commercialization of product candidates, might lead to additional responsibilities for us with respect
to product candidates, or might result in litigation or arbitration, any of which would be time-consuming and expensive;

• collaborators may not properly maintain or defend our intellectual property rights or may use our proprietary information
in such a way as to invite litigation that could jeopardize or invalidate our intellectual property or proprietary information or expose us to potential litigation;

• collaborators may infringe the intellectual property rights of third parties, which may expose us to litigation and
potential liability; and

• collaborations may be terminated and, if terminated, may result in a need for additional capital to pursue further
development or commercialization of the applicable product candidates.

Collaboration agreements may not lead to development or commercialization of product candidates in the most efficient manner or at all. If any future collaborator of ours is involved in a business combination, it could decide to delay, diminish or terminate the development or commercialization of any product candidate licensed to it by us.

***If any third-party manufacturer of our product candidates is unable to increase the scale of its production of our product candidates or increase the product yield of its manufacturing, then our manufacturing costs may increase and commercialization may be delayed.***

In order to produce sufficient quantities to meet the demand for clinical trials and, if approved, subsequent commercialization of our product candidates, our third-party manufacturers will be required to increase their production and optimize their manufacturing processes while maintaining the quality of our product candidates. The transition to larger scale production could prove difficult. In addition, if our third-party manufacturers are not able to optimize their manufacturing processes to increase the product yield for our product candidates, or if they are unable to produce increased amounts of our product candidates while

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maintaining the same quality then we may not be able to meet the demands of clinical trials or market demands, which could decrease our ability to generate profits and have a material adverse impact on our business, financial condition and results of operations.

***Changes in methods of product candidate manufacturing or formulation may result in additional costs or delay.***

As product candidates proceed through preclinical studies to late-stage clinical trials towards potential approval and commercialization, it is common that various aspects of the development program, such as the vendors used to manufacture drug product or manufacturing methods and formulation, are altered along the way in an effort to optimize processes and results. Such changes carry the risk that they will not achieve these intended objectives. Any of these changes could cause our product candidates to perform differently and affect the results of planned clinical trials or other future clinical trials conducted with the materials manufactured using altered processes. Such changes may also require additional testing, FDA notification or FDA approval and similar foreign notifications and approvals. This could delay or prevent completion of clinical trials, require conducting bridging clinical trials or the repetition of one or more clinical trials, increase clinical trial costs, delay or prevent approval of our product candidates and jeopardize our ability to commence sales and generate revenue.

**Risks related to government regulation** 

***Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not mean that we will be successful in obtaining regulatory approval of our product candidates in other jurisdictions.***

Obtaining and maintaining regulatory approval of our product candidates in one jurisdiction does not guarantee that we will be able to obtain or maintain regulatory approval in any other jurisdiction, while a failure or delay in obtaining regulatory approval in one jurisdiction may have a negative effect on the regulatory approval process in others. For example, even if the FDA grants marketing approval of a product candidate, the EMA or comparable foreign regulatory authorities must also approve the manufacturing and marketing of the product candidate in those countries. Approval procedures vary among jurisdictions and can involve requirements and administrative review periods different from, and greater than, those in the United States, including additional preclinical studies or clinical trials, as clinical trials conducted in one jurisdiction may not be accepted by regulatory authorities in other jurisdictions. In many jurisdictions outside the United States, a product candidate must be approved for reimbursement before it can be approved for sale in that jurisdiction. In some cases, the price that we intend to charge for our products is also subject to approval.

We may also submit marketing applications in other countries. Regulatory authorities in jurisdictions outside of the United States have requirements for approval of product candidates with which we must comply prior to marketing in those jurisdictions. Approval processes vary among countries and can involve additional product testing and validation, as well as additional administrative review periods. Seeking foreign regulatory approval could result in difficulties and increased costs for us and require additional preclinical studies or clinical trials which could be costly and time consuming. Obtaining foreign regulatory approvals and compliance with foreign regulatory requirements could result in significant delays, difficulties and costs for us and could delay or prevent the introduction of our products in certain countries. If we fail to comply with the regulatory requirements in international markets and/or receive applicable marketing approvals, our target market will be reduced and our ability to realize the full market potential of our product candidates will be harmed. We do not have any product candidates approved for sale in any jurisdiction, including in international markets, and we do not have experience in obtaining regulatory approval in international markets. If we fail to comply with regulatory requirements in international markets or to obtain and maintain required approvals, or if regulatory approvals in international markets are delayed, our target market will be reduced and our ability to realize the full market potential of any product we develop will be unrealized.

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***Even if we receive regulatory approval of any product candidates, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and we may be subject to penalties if we fail to comply with regulatory requirements or experience unanticipated problems with our product candidates.***

If any of our product candidates are approved, they will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage, distribution, AE reporting, advertising, promotion, sampling, import, export, record-keeping, conduct of post-marketing studies and submission of safety, efficacy and other post-market information, including both federal and state requirements in the United States and requirements of comparable foreign regulatory authorities. In addition, we will be subject to continued compliance with cGMP (and comparable) and GCP requirements for any clinical trials that we conduct post-approval.

Manufacturers and manufacturers' facilities are required to comply with extensive FDA, EMA and other comparable regulatory authority requirements, including ensuring that quality control and manufacturing procedures conform to cGMP regulations and applicable product tracking and tracing requirements. As such, we and our contract manufacturers will be subject to continual review and inspections to assess compliance with cGMP and adherence to commitments made in any NDA, other marketing application and previous responses to inspection observations. Accordingly, we and others with whom we work must continue to expend time, money and effort in all areas of regulatory compliance, including manufacturing, production and quality control.

Any regulatory approvals that we receive for our product candidates may be subject to limitations on the approved indicated uses for which the product may be marketed or to the conditions of approval, or contain requirements for potentially costly post-marketing testing, including Phase 4 clinical trials and surveillance to monitor the safety and efficacy of the product candidate. Certain endpoint data we hope to include in any approved product labeling also may not make it into such labeling, including exploratory or secondary endpoint data such as patient-reported outcome measures. The FDA may also require a REMS program as a condition of approval of our product candidates, which could entail requirements for long-term patient follow-up, a medication guide, physician communication plans or additional elements to ensure safe use, such as restricted distribution methods, patient registries and other risk minimization tools. In addition, if the FDA, EMA or other comparable regulatory authority approves our product candidates, we will have to comply with requirements including submissions of safety and other post-marketing information and reports and registration.

The FDA may impose consent decrees or withdraw approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market. Later discovery of previously unknown problems with our product candidates, including AEs of unanticipated severity or frequency, or with our third-party manufacturers or manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information, imposition of post-market studies or clinical trials to assess new safety risks or imposition of distribution restrictions or other restrictions under a REMS program. Other potential consequences include, among other things:

• restrictions on the marketing or manufacturing of our products, withdrawal of the product from the market or voluntary
product recalls;

• restrictions on product distribution or use, or requirements to conduct post-marketing studies or clinical trials;

• fines, restitutions, disgorgement of profits or revenues, warning letters, untitled letters or holds on clinical trials;

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• refusal by the FDA to approve pending applications or supplements to approved applications submitted by us or suspension or
withdrawal of approvals;

• product seizure or detention or refusal to permit the import or export of our product candidates; and

• injunctions or the imposition of civil or criminal penalties.

Additionally, under the Food and Drug Omnibus Reform Act ("FDORA") sponsors of approved drugs and biologics must provide 6 months' notice to the FDA of any changes in marketing status, such as the withdrawal of a drug, and failure to do so could result in the FDA placing the product on a list of discontinued products, which would revoke the product's ability to be marketed. The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. Products may be promoted only for the approved indications and in accordance with the provisions of the approved label. The policies of the FDA, EMA and other comparable regulatory authorities may change and additional government regulations may be enacted that could prevent, limit or delay regulatory approval of our product candidates. We cannot predict the likelihood, nature or extent of government regulation that may arise from future legislation or administrative action, either in the United States or abroad. If we are slow or unable to adapt to changes in existing requirements or the adoption of new requirements or policies, or if we are not able to maintain regulatory compliance, we may lose any marketing approval that we may have obtained and we may not achieve or sustain profitability.

***The FDA and other regulatory agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses.***

The FDA strictly regulates marketing, labeling, advertising and promotion of prescription drugs. These regulations include standards and restrictions for direct-to-consumer advertising, industry-sponsored scientific and educational activities, promotional activities involving the internet and off-label promotion. Any regulatory approval that the FDA grants is limited to those specific diseases and indications for which a product is deemed to be safe and effective by FDA. While physicians in the United States may choose, and are generally permitted, to prescribe drugs for uses that are not described in the product's labeling and for uses that differ from those tested in clinical trials and approved by the regulatory authorities, our ability to promote any products will be narrowly limited to those indications that are specifically approved by the FDA.

If we are found to have promoted such off-label uses, we may become subject to significant liability. The U.S. federal government has levied large civil and criminal fines against companies for alleged improper promotion of off-label use and has enjoined several companies from engaging in off-label promotion. The FDA has also requested that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed. If we cannot successfully manage the promotion of any product candidates, if approved, we could become subject to significant liability, which would materially adversely affect our business and financial condition.

***We may pursue orphan drug designation for certain of our product candidates, and we may not be able to obtain such designation, or obtain or maintain the benefits of such designation including orphan drug exclusivity, and even if we do, that exclusivity may not prevent regulatory authorities from approving other competing products.***

We intend to seek orphan drug designation for some of our other product candidates; however, we may never receive such designations. Under the Orphan Drug Act, the FDA may designate a product as an orphan drug if it is a drug or biologic intended to treat a rare disease or condition, defined as a patient population of fewer than 200,000 in the U.S., or a patient population greater than 200,000 in the U.S. where there is no reasonable

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expectation that the cost of developing the drug will be recovered from sales in the U.S. Orphan drug designation must be requested before submitting an NDA. A similar regulatory scheme governs orphan products in the EU.

Orphan drug designation entitles a party to financial incentives such as opportunities for grant funding towards clinical trial costs, tax advantages and application fee waivers. After the FDA grants orphan drug designation, the generic identity of the drug and its potential orphan use are disclosed publicly by the FDA. In addition, if a product candidate with an orphan drug designation subsequently receives the first marketing approval for the indication for which it has such designation, the product is entitled to a period of marketing exclusivity, which precludes the FDA from approving another marketing application for the same product for the same therapeutic indication for seven years.

Even if we obtain orphan drug exclusivity for a product, that exclusivity may not effectively protect the product from competition because different products can be approved for the same condition and indication. In addition, even after an orphan drug is approved, the FDA can subsequently approve the same product for the same approved use or indication if the FDA concludes that the later product is clinically superior in that it is shown to be safer, more effective or makes a major contribution to patient care. Orphan drug exclusivity may also be lost if the FDA determines that the request for designation was materially defective or if the manufacturer is unable to assure sufficient quantity of the product to meet the needs relating to the relevant approved use or indication of the patients with the rare disease or condition. Further, even if we obtain orphan drug designation, we may not be the first to obtain marketing approval for any particular orphan indication due to the uncertainties associated with developing pharmaceutical products.

The FDA may further reevaluate the Orphan Drug Act and its regulations and policies. We do not know if, when, or how the FDA may change the orphan drug regulations and policies in the future, and it is uncertain how any changes might affect our business. Depending on what changes the FDA may make to its orphan drug regulations and policies, our business could be adversely impacted.

In the EU, orphan designation is granted by the EC based on a scientific opinion of the EMA's Committee for Orphan Medicinal Products. A medicinal product may be designated as orphan if its sponsor can establish that (i) the product is intended for the diagnosis, prevention or treatment of a life-threatening or chronically debilitating condition; (ii) either (a) such condition affects no more than 5 in 10,000 persons in the EU when the application is made, or (b) the product, without the benefits derived from orphan status, would not generate sufficient return in the EU to justify investment; and (iii) there exists no satisfactory method of diagnosis, prevention or treatment of such condition authorized for marketing in the EU, or if such a method exists, the medicinal product will be of significant benefit to those affected by the condition. The application for orphan designation must be submitted before the application for marketing authorization.

In the EU, orphan designation entitles a party to financial incentives such as reduction of fees, fee waivers, protocol assistance, and access to the centralized marketing authorization procedure. Moreover, upon grant of a marketing authorization and assuming the requirement for orphan designation are also met at the time the marketing authorization is granted, orphan medicinal products are entitled to a ten-year period of market exclusivity for the approved therapeutic indication. The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed Pediatric Investigation Plan. However, during such period, marketing authorizations may be granted to a similar medicinal product with the same orphan indication if: (i) the applicant can establish that the second medicinal product, although similar to the orphan medicinal product already authorized is safer, more effective or otherwise clinically superior to the orphan medicinal product already authorized; (ii) the marketing authorization holder for the orphan medicinal product grants its consent; or (iii) if the marketing authorization holder of the orphan medicinal product is unable to supply sufficient quantities of product. The European exclusivity period can be reduced to six years, if,

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at the end of the fifth year a medicine no longer meets the criteria for orphan designation (i.e. the prevalence of the condition has increased above the orphan designation threshold or it is judged that the product is sufficiently profitable so as not to justify maintenance of market exclusivity).

***While we may in the future seek designations for our product candidates with the FDA, EMA and other comparable regulatory authorities that are intended to confer benefits such as a faster development process, a streamlined regulatory pathway or regulatory exclusivity, there can be no assurance that we will successfully obtain such designations. In addition, even if one or more of our product candidates are granted such designations, we may not be able to realize the intended benefits of such designations.***

The FDA, EMA, and other comparable regulatory authorities offer certain designations for product candidates that are designed to encourage the research and development of product candidates that are intended to address conditions with significant unmet medical need. These designations may confer benefits such as additional interaction with regulatory authorities, a potentially accelerated regulatory pathway and priority review. However, there can be no assurance that we will successfully obtain such designations for our product candidates. In addition, while such designations could expedite the development or approval process, they generally do not change the standards for approval. Even if we obtain such designations for our product candidates, there can be no assurance that we will realize their intended benefits.

For example, we may seek a Fast Track Designation for future product candidates we develop. If a product is intended for the treatment of a serious or life-threatening condition and preclinical or clinical data demonstrate the potential to address an unmet medical need for this condition, the product sponsor may apply for Fast Track Designation. Fast Track designation applies to the combination of the product candidate and the specific indication for which it is being studied. The sponsor of a Fast Track product candidate has opportunities for more frequent interactions with the applicable FDA review team during product development and, once a NDA is submitted, the application may be eligible for priority review. A NDA submitted for a Fast Track product candidate may also be eligible for rolling review, where the FDA may consider for review sections of the NDA on a rolling basis before the complete application is submitted, if the sponsor provides a schedule for the submission of the sections of the NDA, the FDA agrees to accept sections of the NDA and determines that the schedule is acceptable, and the sponsor pays any required user fees upon submission of the first section of the application.

The FDA has broad discretion whether or not to grant this designation, so even if we believe a particular product candidate is eligible for this designation, we cannot assure you that the FDA would decide to grant it. Even if we do receive Fast Track Designation, we may not experience a faster development process, review or approval compared to conventional FDA procedures. The FDA may rescind the Fast Track Designation if it believes that the designation is no longer supported by data from our clinical development activities.

We may seek Breakthrough Therapy Designation for any product candidate that we develop. A breakthrough therapy is defined as a drug that is intended, alone or in combination with one or more other drugs, to treat a serious or life-threatening disease or condition, and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over currently approved therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. For drugs that have been designated as breakthrough therapies, interaction and communication between the FDA and the sponsor of the trial can help to identify the most efficient path for clinical development while minimizing the number of patients placed in ineffective control regimens. Drugs and biologics designated as Breakthrough Therapies also receive the same benefits associated with Fast Track designation, including eligibility for rolling review of a submitted NDA, if the relevant criteria are met. Drugs designated as breakthrough therapies by the FDA are also eligible for accelerated approval and priority review.

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Designation as a breakthrough therapy is within the discretion of the FDA. Accordingly, even if we believe a product candidate we develop meets the criteria for designation as a breakthrough therapy, the FDA may disagree and instead determine not to make such designation. In any event, the receipt of Breakthrough Therapy Designation for a product candidate may not result in a faster development process, review or approval compared to drugs considered for approval under conventional FDA procedures and does not assure ultimate approval by the FDA. In addition, even if any product candidate we develop qualifies as a breakthrough therapy, the FDA may later decide that the drug no longer meets the conditions for qualification and rescind the designation.

Even in the absence of obtaining Fast Track and/or Breakthrough Therapy Designations, a sponsor can seek priority review at the time of submitting a marketing application. The FDA may designate a product for priority review if it is a product that treats a serious condition and, if approved, would provide a significant improvement in safety or effectiveness when compared with other available therapies. Significant improvement may be illustrated by evidence of increased effectiveness in the treatment of a condition, elimination or substantial reduction of a treatment-limiting adverse reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, or evidence of safety and effectiveness in a new subpopulation. A priority review designation is intended to direct overall attention and resources to the evaluation of such applications, and to shorten the FDA's goal for taking action on a marketing application from ten months to six months. Priority review designation may be rescinded if a product no longer meets the qualifying criteria.

***Where appropriate, we may secure approval from the FDA, EMA or other comparable regulatory authorities through the use of expedited approval pathways, such as accelerated approval. If we are unable to obtain such approvals, we may be required to conduct additional preclinical studies or clinical trials beyond those that we contemplate, which could increase the expense of obtaining, and delay the receipt of, necessary marketing approvals. Even if we receive accelerated approval from the FDA, EMA, or other comparable regulatory authorities, if our confirmatory trials do not verify clinical benefit, or if we do not comply with rigorous post-marketing requirements, the FDA, EMA, or such other regulatory authorities may seek to withdraw the accelerated approval.***

Where possible, we plan to pursue accelerated development strategies in areas of high unmet need. We may seek an accelerated approval pathway for our one or more of our therapeutic candidates from the FDA, EMA, or other comparable regulatory authorities. Under the accelerated approval provisions in the Federal Food, Drug, and Cosmetic Act, and the FDA's implementing regulations, the FDA may grant accelerated approval to a therapeutic candidate designed to treat a serious or life-threatening condition that provides meaningful therapeutic benefit over available therapies upon a determination that the therapeutic candidate has an effect on a surrogate endpoint or intermediate clinical endpoint that is reasonably likely to predict clinical benefit. The FDA considers a clinical benefit to be a positive therapeutic effect that is clinically meaningful in the context of a given disease, such as irreversible morbidity or mortality. For the purposes of accelerated approval, a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign, or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. An intermediate clinical endpoint is a clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality that is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit. The accelerated approval pathway may be used in cases in which the advantage of a new drug over available therapy may not be a direct therapeutic advantage but is a clinically important improvement from a patient and public health perspective. If granted, accelerated approval is usually contingent on the sponsor's agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the drug's clinical benefit. Under FDORA, the FDA is permitted to require, as appropriate, that a post-approval confirmatory study or studies be underway prior to approval or within a specified time period after

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the date of approval for a product granted accelerated approval. FDORA also gives the FDA increased authority to withdraw approval of a drug or biologic granted accelerated approval on an expedited basis if the sponsor fails to conduct such studies in a timely manner, send status updates on such studies to the FDA every 180 days to be publicly posted by the agency, or if such post-approval studies fail to verify the drug's predicted clinical benefit. The FDA is empowered to take action, such as issuing fines, against companies that fail to conduct with due diligence any post-approval confirmatory study or submit timely reports to the agency on their progress.

Prior to seeking accelerated approval, we would seek feedback from the FDA, EMA, or other comparable regulatory authorities and would otherwise evaluate our ability to seek and receive such accelerated approval.

There can be no assurance that after our evaluation of the feedback and other factors we will decide to pursue or submit an NDA for accelerated approval or any other form of expedited development, review or approval. Similarly, there can be no assurance that after subsequent feedback from the FDA, EMA, or other comparable regulatory authorities, we will continue to pursue or apply for accelerated approval or any other form of expedited development, review or approval, even if we initially decide to do so. Furthermore, if we decide to submit an application for accelerated approval, there can be no assurance that such application will be accepted or that any approval will be granted on a timely basis, or at all. The FDA, EMA or other comparable regulatory authorities could also require us to conduct further studies prior to considering our application or granting approval of any type, including, for example, if other products are approved via the accelerated pathway and subsequently converted by FDA to full approval. A failure to obtain accelerated approval or any other form of expedited development, review or approval for our therapeutic candidate would result in a longer time period to commercialization of such therapeutic candidate, could increase the cost of development of such therapeutic candidate and could harm our competitive position in the marketplace.

***If we are required by the FDA to obtain approval of a companion diagnostic in connection with approval of any of our product candidates, and we do not obtain, or face delays in obtaining, FDA approval of such companion diagnostic, we will not be able to commercialize such product candidate and our ability to generate revenue will be materially impaired.***

According to FDA guidance, if the FDA determines that a companion diagnostic device is essential to the safe and effective use of a novel therapeutic product or indication, the FDA generally will not approve the therapeutic product or new therapeutic product indication if the companion diagnostic is not also approved or cleared for that indication. Depending on the data from our clinical trials, we may decide to collaborate with diagnostic companies during our clinical trial enrollment process to help identify patients with characteristics that we believe will be most likely to respond to our product candidates. If a satisfactory companion diagnostic is not commercially available in this situation, we may be required to develop or obtain such test, which would be subject to regulatory approval requirements. The process of obtaining or creating such diagnostic is time consuming and costly.

Companion diagnostics are developed in conjunction with clinical programs for the associated product and are subject to regulation as medical devices by the FDA and comparable foreign regulatory authorities. The approval or clearance of a companion diagnostic as part of the therapeutic product's further labeling limits the use of the therapeutic product to only those patients who express the specific characteristic that the companion diagnostic was developed to detect.

If the FDA or a comparable foreign regulatory authority requires approval or clearance of a companion diagnostic for any of our product candidates, whether before or after the product candidate obtains regulatory approval, we and/or third-party collaborators may encounter difficulties in developing and obtaining approval or clearance for these companion diagnostics. Any delay or failure by us or third-party collaborators to develop or obtain regulatory approval or clearance of a companion diagnostic could delay or prevent approval or

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continued marketing of the relevant product. We or our collaborators may also experience delays in developing a sustainable, reproducible and scalable manufacturing process for the companion diagnostic or in transferring that process to commercial partners or negotiating insurance reimbursement plans, all of which may prevent us from completing our clinical trials or commercializing our product candidates, if approved, on a timely or profitable basis, if at all.

***If we fail to maintain necessary regulatory clearance for our Prolaio platform, which includes features that are regulated by the FDA and which may be regulated in foreign jurisdictions as medical devices, or if clearances or approvals for future devices and indications are delayed or not issued, our commercial operations would be harmed.***

Our Prolaio platform currently includes features that are regulated by the FDA and which may be regulated in foreign jurisdictions as medical devices. Changes to our Prolaio platform could be subject to extensive medical device regulation by the FDA in the United States and outside the United States. Government regulations specific to medical devices are wide-ranging and govern, among other things:

• device design, development and manufacture;

• laboratory, preclinical and clinical testing, labeling, packaging, and storage;

• premarket clearance or approval;

• record keeping;

• device marketing, promotion and advertising, sales and distribution; and

• post-marketing surveillance, including reporting of deaths and serious injuries and recalls and correction and removals.

Any failure to obtain further 510(k) clearances or any required foreign marketing authorizations may add significant time and expense to our regulatory clearance and marketing process, may delay our ability to generate revenue, and may have a negative impact on our stock price. We may not be able to obtain or maintain the necessary clearances, approvals, or authorizations necessary to market the Prolaio platform for specific indications inside or outside the United States or such approvals, clearances, or authorizations may be unduly delayed, which could harm our business. Additionally, if the FDA rejects our 510(k) submissions for specific indications, we may be required to obtain FDA authorization through the de novo pathway, which will require additional time and resources, including potentially the need to conduct additional clinical trials to demonstrate safety and effectiveness of our candidate device.

Moreover, the FDA may not approve or clear our 510(k), de novo request, or PMA applications and foreign regulatory authorities may not authorize our applications on a timely basis or at all. Such delays or refusals could have a material adverse effect on our business operations and financial condition. The FDA or foreign regulatory authorities may also change authorization, clearance and approval policies, adopt additional regulations or revise existing regulations, or take other action which may prevent or delay approval or clearance of our products under development. Any of these actions could have a material adverse effect on our business operations and financial condition.

Certain features of our Prolaio platform that are solely intended to transfer, store, convert formats, or display medical device data or results are listed with the FDA as a Class I, 510(k)-exempt, medical device data system. From time to time, the FDA may disagree with the classification regulation under which a registrant lists their device. For example, the FDA may disagree with a registrant's determination to classify their device as a Class I medical device. Instead, the FDA may determine the device to be a Class II or Class III device requiring the

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submission of a 510(k) or PMA application for premarket clearance or approval. In the event that the FDA determines that our devices, whether by functionality or marketing claims, exceeds the limitations on 510(k)-exemption such that premarket clearance or approval is required (i.e., that our device is intended for a use different from the intended use of a legally marketed device in the generic type of device under the applicable classification regulation or that our modified device operates using a different fundamental scientific technology than such a legally marketed device), should be classified as Class II devices or Class III devices requiring premarket clearance or approval, or should the FDA decide to reclassify our device as a Class II or Class III device requiring premarket clearance or approval, we could be precluded from marketing our devices for clinical use within the United States for months or longer depending on the requirements of the classification. Obtaining premarket clearance or approval could significantly increase our regulatory costs, including expense associated with potentially required preclinical studies and clinical trials, more extensive testing and other costs.

We are subject to ongoing and extensive regulatory requirements governing, among other things, the manufacture, marketing, advertising, medical device reporting, sale, promotion, import, export, registration, and listing of devices. For example, medical device manufacturers must submit certain reports to the FDA and keep required records as a condition of obtaining and maintaining marketing authorization. These reports include information about failures and certain AEs potentially associated with the device after its marketing authorization. Failure to submit such reports, or failure to submit the reports in a timely manner, could result in enforcement action by the FDA. Following its review of the periodic reports, the FDA might ask for additional information or initiate further investigation.

The FDA and the U.S. Federal Trade Commission ("FTC") also regulate the advertising and promotion of our devices to ensure that the claims we make are consistent with our regulatory clearances or approvals, that there are adequate and reasonable data to substantiate the claims and that our promotional labeling and advertising is neither false nor misleading in any respect. If the FDA or the FTC determines that any of our advertising or promotional claims are misleading, not substantiated or not permissible, we may be subject to enforcement actions, including FDA warning letters, and we may be required to revise our promotional claims and make other corrections or restitutions.

FDA and state authorities have broad enforcement powers. Our failure to comply with applicable regulatory requirements could result in enforcement action by the FDA or state agencies, which may include any of the following sanctions, among others:

• adverse publicity, warning letters, fines, injunctions, consent decrees, and civil penalties;

• obligations to repair, replace, refund, or recall our marketed devices, or government seizure of them;

• operating restrictions, partial suspension, or total shutdown of production;

• refusing our requests for 510(k) clearance or premarket approval of new devices, new intended uses or modifications to
existing devices;

• withdrawing premarket approvals that have already been granted or reclassifying our devices; and

• criminal prosecution.

If any of these events were to occur, our business and financial condition would be harmed.

***Our relationships with healthcare providers and physicians and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could increase our***

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 ***compliance costs, and expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings.***

Our business operations and current and future arrangements with investigators, healthcare professionals, consultants, marketing personnel, third-party payors, patient organizations and customers expose us to broadly applicable foreign, federal and state fraud and abuse and other healthcare laws and regulations. These laws may constrain the business or financial arrangements and relationships through which we conduct our operations, including how we research, market, sell and distribute any product for which we obtain regulatory approval.

Efforts to ensure that our current and future business arrangements both internally and with third parties will comply with applicable healthcare laws and regulations will involve ongoing substantial costs. It is possible that governmental and enforcement authorities will conclude that our business practices, including certain consulting agreements and advisory board agreements we have entered into with physicians who are paid, in part, in the form of stock or stock options, may not comply with current or future statutes, regulations or case law interpreting applicable fraud and abuse or other healthcare laws and regulations. These laws include federal and state anti-kickback laws, false claims statutes, civil monetary penalties laws, as well as transparency laws regarding payments or other items of value provided to healthcare providers, and laws related to price reporting. Due to the breadth of these laws, the narrowness of statutory exceptions and regulatory safe harbors available, and the range of interpretations to which they are subject, it is possible that some of our current or future practices may be challenged under one or more of these laws. Healthcare providers, physicians and third-party payors in the United States and elsewhere play a primary role in the recommendation and prescription of pharmaceutical products. Arrangements with third-party payors and customers can expose pharmaceutical and medical technology companies to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we conduct research and would sell, market and distribute our products. For more information on healthcare laws and regulations that may impact our company, see the section titled "*Business—Government Regulation—Other Healthcare Laws*" included elsewhere in this prospectus.

The scope and enforcement of each of these laws is uncertain and subject to rapid change in the current environment of healthcare reform, especially in light of the lack of applicable precedent and regulations. Federal and state enforcement bodies have recently increased their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations, prosecutions, convictions and settlements in the healthcare industry. Ensuring business arrangements comply with applicable healthcare laws, as well as responding to possible investigations by government authorities, can be time and resource-consuming and can divert a company's attention from the business.

It is possible that governmental authorities will conclude that our business practices do not comply with current or future statutes, regulations, agency guidance or case law involving applicable fraud and abuse or other healthcare laws and regulations. If our operations are found to be in violation of any of these laws or any other governmental laws and regulations that may apply to us, we may be subject to significant penalties, including administrative, civil and criminal penalties, damages, fines, disgorgement, the exclusion from participation in federal and state healthcare programs, such as Medicare and Medicaid integrity oversight and reporting obligations, contractual damages, individual imprisonment, reputational harm, diminished profits and future earnings, and the curtailment or restructuring of our operations, as well as additional reporting obligations and oversight if we become subject to a corporate integrity agreement or other agreement to resolve allegations of non-compliance with these laws. Further, defending against any such actions can be costly and time consuming, and may require significant financial and personnel resources. Therefore, even if we are successful in defending against any such actions that may be brought against us, our business may be impaired. If any of the physicians or other providers or entities with whom we expect to do business are found to not be in compliance with

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applicable laws, they may be subject to criminal, civil or administrative sanctions, including exclusions from government funded healthcare programs and imprisonment. If any of the above occur, our ability to operate our business and our results of operations could be adversely affected.

Much like the federal Anti-Kickback Statute prohibition in the United States, the provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is also prohibited in the European Union. The provision of benefits or advantages to reward improper performance generally is typically governed by the national anti-bribery laws of EU Member States and the Bribery Act 2010 in the United Kingdom. Infringement of these laws could result in substantial fines and imprisonment. EU Directive 2001/83/EC, which is the EU Directive governing medicinal products for human use, further provides that, where medicinal products are being promoted to persons qualified to prescribe or supply them, no gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised to such persons unless they are inexpensive and relevant to the practice of medicine or pharmacy. This provision has been transposed into the Human Medicines Regulations 2012 and so remains applicable in the United Kingdom despite its departure from the European Union.

Payments made to physicians in certain EU Member States must be publicly disclosed. Moreover, agreements with physicians often must be the subject of prior notification and approval by the physician's employer, his or her competent professional organization and/or the regulatory authorities of the individual EU Member States. These requirements are provided in the national laws, industry codes or professional codes of conduct, applicable in the EU Member States. Failure to comply with these requirements could result in reputational risk, public reprimands, administrative penalties, fines or imprisonment.

***The successful commercialization of any of our product candidates, if approved, will depend in part on the extent to which governmental authorities and health insurers establish coverage, adequate reimbursement levels and favorable pricing policies. Coverage and reimbursement may be limited or unavailable in certain market segments for our product candidates, if approved, which could make it difficult for us to sell any product candidates profitably.***

The success of our product candidates, if approved, depends on the availability of coverage and adequate reimbursement from third-party payors, including governmental healthcare programs such as Medicare and Medicaid, private health insurers and other third-party payors. Our ability to achieve coverage and acceptable levels of reimbursement for our product candidates by third-party payors will have an effect on our ability to successfully commercialize those products. We cannot be sure that coverage and reimbursement will be available for, or accurately estimate the potential revenue from, our product candidates or assure that coverage and reimbursement will be available for any product that we may develop. For more information on the laws and regulations that may impact coverage and reimbursement of our product candidates, see the section titled "*Business—Government Regulation—Coverage and Reimbursement*" included elsewhere in this prospectus.

Patients who are provided medical treatment for their conditions generally rely on third-party payors to reimburse all or part of the costs associated with their treatment. Coverage and adequate reimbursement from governmental healthcare programs, such as Medicare and Medicaid, and commercial payors is critical to new product acceptance.

Government authorities and other third-party payors, such as private health insurers and health maintenance organizations, decide which products and services they will cover and the amount of reimbursement. Coverage and reimbursement by a third-party payor may depend upon a number of factors, including the third-party payor's determination that use of a product or service is:

• a covered benefit under its health plan;

• safe, effective and medically necessary;

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• appropriate for the specific patient;

• cost-effective; and

• neither experimental nor investigational.

In the United States, no uniform policy of coverage and reimbursement for products and services exists among all third-party payors. As a result, obtaining coverage and reimbursement approval of a product or service from a government or other third-party payor is a time-consuming and costly process that could require us to provide to each payor supporting scientific, clinical and cost-effectiveness data for the use of our products or services on a payor-by-payor basis, with no assurance that coverage and adequate reimbursement will be obtained. Furthermore, rules and regulations regarding reimbursement change frequently, and, in some cases, at short notice, and we believe that changes in these rules and regulations are likely.

Third-party payors increasingly are challenging prices charged for medical products and services, and many third-party payors may refuse to provide coverage and reimbursement for particular technologies or drugs when an equivalent generic drug or a less expensive therapy is available. It is possible that a third-party payor may consider our product candidates as substitutable and offer to reimburse patients only for a less expensive competitor product. Even if we are successful in demonstrating improved efficacy or improved convenience of administration with our product candidates, pricing of existing products and services may limit the amount we will be able to charge for our products and services. These payors may deny or revoke the reimbursement status of a given product or service, or establish prices for new or existing marketed products or services at levels that are too low to enable us to realize an appropriate return on our investment in product development. If reimbursement is not available or is available only at limited levels, we may not be able to successfully commercialize our products and may not be able to obtain a satisfactory financial return on products that we may develop.

Even if we obtain coverage for a given product, the resulting reimbursement payment rates might not be adequate for us to achieve or sustain profitability or may require co-payments that patients find unacceptably high. There is significant uncertainty related to insurance coverage and reimbursement of newly approved products. In the United States, no uniform policy of coverage and reimbursement for drug products exists among third-party payors. Private payors tend to follow the coverage and reimbursement policies established by the U.S. Centers for Medicare & Medicaid Services ("CMS") which determines whether and to what extent a new medicine will be covered and reimbursed under Medicare. Additionally, third-party payors may not cover, or provide adequate reimbursement for, long-term follow-up evaluations, or other ancillary services required following the use of product candidates, once approved. Some third-party payors may require pre-approval of coverage or implement prior authorization or step therapy programs for new or innovative drug therapies or services before they will reimburse patients who use such therapies which may become time-consuming or costly for patients and lead to a reduction in revenue. Patients are unlikely to use our product candidates, once approved, unless coverage is provided and reimbursement is adequate to cover a significant portion of their cost. It is difficult to predict at this time what third-party payors will decide with respect to the coverage and reimbursement for our product candidates. Even if favorable coverage and reimbursement status is attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future.

Net prices for certain products, especially for drug products may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future changes to laws. Increasingly, third-party payors are requiring that companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. We cannot be sure that reimbursement will be available for any product candidate that we commercialize and, if reimbursement is available, the level of reimbursement. In addition, many pharmaceutical manufacturers are required to calculate and report

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certain price reporting metrics to the government, such as average sales price and best price. Penalties may apply in some cases when such metrics are not submitted accurately and timely. Further, these prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs. Payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives.

Moreover, increasing efforts by governmental and other third-party payors in the United States and abroad to cap or reduce healthcare costs may cause such organizations to limit both coverage and the level of reimbursement for newly approved products and, as a result, they may not cover or provide adequate payment for our product candidates. If, for example, we participate in the Medicaid Drug Rebate Program or other governmental pricing programs, in certain circumstances, our products would be subject to ceiling prices set by such programs, which could reduce the revenue we may generate from any such products. Participation in such programs would also expose us to the risk of significant civil monetary penalties, sanctions and fines should we be found to be in violation of any applicable obligations thereunder. There has been increasing legislative and enforcement interest in the United States with respect to specialty drug pricing practices. Specifically, there have been several recent U.S. Congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs and reform government program reimbursement methodologies for drugs.

We expect that healthcare reform measures that may be adopted in the future may result in more rigorous coverage criteria and in additional downward pressure on the price that we receive for any approved product. The implementation of cost containment measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize our products. Legislative and regulatory proposals have been made to expand post-approval requirements and restrict sales and promotional activities for pharmaceutical products. We cannot be sure whether additional legislative changes will be enacted, or whether the FDA regulations, guidance or interpretations will be changed, or what the impact of such changes on the marketing approvals or clearances of our product candidates, if any, may be.

In addition, in some foreign countries, the proposed pricing for a product must be approved before it may be lawfully marketed. The requirements governing product pricing vary widely from country to country. For example, the European Union provides options for its Member States to restrict the range of medicinal products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. To obtain reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost effectiveness of a particular product candidate to currently available therapies. A Member State may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our product candidates. Historically, products launched in the European Union do not follow price structures of the United States and generally prices tend to be significantly lower.

***Ongoing healthcare legislative and regulatory reform measures may have a material adverse effect on our business and results of operations and increase the difficulty and cost for us to obtain coverage for and commercialize any of our current or future product candidates and may adversely affect the prices we may set.***

Changes in regulations, statutes or the interpretation of existing regulations could impact our business in the future by requiring, for example, (1) changes to our manufacturing arrangements, (2) additions or modifications to product labeling, (3) the recall or discontinuation of our products or (4) additional record-keeping requirements. As a company developing both pharmaceutical products and utilizing medical device technology through our acquisition of Prolaio, we may be subject to healthcare reform measures affecting both drug and

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device manufacturers. If any such changes were to be imposed, they could adversely affect the operation of our business. See the section titled "*Business—Current and Future U.S. Healthcare Reform*" included elsewhere in this prospectus.

The containment of healthcare costs has become a priority of federal, state and foreign governments, and the prices of products have been a focus in this effort. There have been a number of federal and state proposals during the last few years regarding the pricing of pharmaceutical products, limiting coverage and the amount of reimbursement for drugs and other medical products, government control and other changes to the healthcare system in the United States. Governments have shown significant interest in implementing cost-containment programs, including price controls, restrictions on reimbursement and requirements for substitution of generic products. For instance, the Inflation Reduction Act of 2022 (the "IRA") includes several provisions that will impact our business to varying degrees, including provisions that allow the U.S. government to negotiate Medicare Part B and Part D pricing for certain high-cost drugs and biologics without generic or biosimilar competition, among others. Depending upon the implementation of this program, these price-negotiation provisions may have a negative impact on our future revenue and profits. Further, the IRA imposes rebates with respect to certain drugs and biologics covered under Medicare Part B or Medicare Part D to penalize price increases that outpace inflation. The implementation of the IRA is currently subject to ongoing litigation that challenges the constitutionality of the IRA's drug price negotiation program provisions. The outcome of this litigation as well as the effects of the IRA on the pharmaceutical industry cannot yet be fully determined but is likely to be significant. Additional drug pricing proposals could appear in future legislation. Adoption of price controls and cost-containment measures, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit our revenue generated from the sale of any approved products.

Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives. For example, CMS may develop new payment and delivery models, such as bundled payment models. In addition, recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their commercial products, which has resulted in several Congressional inquiries and proposed and enacted state and federal legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for pharmaceutical products. Congress has indicated that it will continue to seek new legislative measures to control drug costs.

At the state level, state governments have increasingly passed legislation and implemented regulations designed to control pharmaceutical and biological product pricing, including price or reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. Legally mandated price controls on payment amounts by third-party payors or other restrictions could harm our business, financial condition, results of operations and prospects. In addition, regional healthcare authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. These measures could reduce the ultimate demand for any of our current and future product candidates, if approved, or put pressure on our product pricing, which could negatively affect our business, financial condition, results of operations and prospects.

These laws, and future state and federal healthcare reform measures may be adopted in the future, any of which may result in additional reductions in Medicare and other healthcare funding, more rigorous coverage criteria, new payment methodologies, and additional downward pressure on the price that we receive for any approved product candidate for which we may obtain regulatory approval, and the frequency with which any such product candidate is prescribed or used. The implementation of cost containment measures, changes in healthcare spending and policy, or other healthcare reforms may prevent us from being able to generate

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revenue, attain profitability or commercialize our product candidates, and materially affect our business, if approved. We operate in a highly regulated industry and new laws, regulations or judicial decisions, or new interpretations of existing laws, regulations or decisions, related to healthcare availability, the method of delivery or payment for healthcare products and services could negatively impact our business, operations and financial condition.

***Our business could be affected by litigation, government investigations and enforcement actions.***

We currently operate in a number of jurisdictions in a highly regulated industry and we could be subject to litigation, government investigation and enforcement actions on a variety of matters in the United States or foreign jurisdictions, including, without limitation, intellectual property, regulatory, product liability, environmental, whistleblower, false claims, privacy, anti-kickback, anti-bribery, securities, commercial, employment and other claims and legal proceedings that may arise from conducting our business. Any determination that our operations or activities are not in compliance with existing laws or regulations could result in the imposition of fines, civil and criminal penalties, exclusion from participation in government-funded healthcare programs, such as Medicare and Medicaid, equitable remedies, including disgorgement, injunctive relief and/or other sanctions against us, and remediation of any such findings could have an adverse effect on our business operations.

Legal proceedings, government investigations and enforcement actions can be expensive and time-consuming. An adverse outcome resulting from any such proceedings, investigations or enforcement actions could result in significant damages awards, fines, penalties, exclusion from the federal healthcare programs, healthcare debarment, injunctive relief, product recalls, reputational damage and modifications of our business practices, which could have a material adverse effect on our business, financial condition, results of operations and prospects. Even if such a proceeding, investigation or enforcement action is ultimately decided in our favor, the investigation and defense thereof could require substantial financial and management resources.

***Our employees, independent contractors, consultants, third-party manufacturers and vendors may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.***

We are exposed to the risk of employee fraud or other illegal activity by our current and any future employees, independent contractors, consultants, contract manufacturers, and vendors. Misconduct by these parties could include intentional, reckless, and/or negligent conduct that fails to comply with FDA or other regulations, provide true, complete and accurate information to the FDA, EMA, and other comparable regulatory authorities, comply with manufacturing standards we may establish, comply with healthcare fraud and abuse laws and regulations, report financial information or data accurately, or disclose unauthorized activities to us. If we obtain FDA approval of any of our product candidates and begin commercializing those products in the United States, our potential exposure under these laws will increase significantly, and our costs associated with compliance with these laws are likely to increase. Employee misconduct could also involve the improper use of information obtained in the course of clinical trials, which could result in regulatory sanctions and serious harm to our reputation. Additionally, we are subject to the risk that a person could allege such fraud or other misconduct, even if none occurred. It is not always possible to identify and deter employee misconduct, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to comply with such laws or regulations. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a material and adverse effect on our business, financial condition, results of operations, and prospects, including, without limitation, the imposition of significant civil, criminal and administrative penalties, damages, monetary fines, disgorgements, possible exclusion from participation in Medicare, Medicaid and other federal healthcare

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programs, imprisonment, contractual damages, reputational harm, diminished profits and future earnings, additional reporting requirements and oversight if we become subject to a corporate integrity agreement or similar agreement to resolve allegations of non-compliance with these laws and curtailment of our operations, any of which could adversely affect our business, financial condition, results of operations and prospects.

***Off-label use or misuse of our product candidates may harm our reputation in the marketplace or result in injuries that lead to costly product liability suits.***

If our product candidates are approved by the FDA, we may only promote or market our product candidates in a manner consistent with their FDA-approved labeling. We will train our marketing and sales force against promoting our product candidates for uses outside of the approved indications for use, known as "off-label uses." We cannot, however, prevent a physician from using our product candidates off-label, when in the physician's independent professional medical judgment he or she deems it appropriate. The use of our product candidates for indications other than those approved by the FDA may not effectively treat such conditions. Any such off-label use of our product candidates could harm our reputation in the marketplace among physicians and patients. There may also be increased risk of injury to patients if physicians attempt to use our product candidates for these uses for which they are not approved, which could lead to product liability suits that might require significant financial and management resources and that could harm our reputation.

***Inadequate funding for the FDA or other government agencies could hinder their ability to hire and retain key leadership and other personnel, prevent new products and services from being developed or commercialized in a timely manner or otherwise prevent those agencies from performing normal business functions on which the operation of our business may rely, which could negatively impact our business.***

The ability of the FDA to review and approve new products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes. Average review times at the agency have fluctuated in recent years as a result. In addition, government funding of other government agencies on which our operations may rely, including those that fund research and development activities, is subject to the political process, which is inherently fluid and unpredictable.

Disruptions at the FDA or other comparable regulatory authorities or government agencies may also slow the time necessary for new drugs to be reviewed and/or approved by necessary government agencies, which would adversely affect our business. For example, in recent years, the U.S. government has shut down several times and certain regulatory agencies, such as the FDA, have had to furlough critical employees and stop critical activities. In addition, the current U.S. Presidential administration has issued certain policies and Executive Orders directed towards reducing the employee headcount and costs associated with U.S. administrative agencies, including the FDA, and it remains unclear the degree to which these efforts may limit or otherwise adversely affect the FDA's ability to conduct routine activities.

If a prolonged government shutdown occurs, including as a result of reaching the debt ceiling, it could significantly impact the ability of the FDA to timely review and process our regulatory submissions, which could have a material adverse effect on our business. Further, future government shutdowns could impact our ability to access the public markets and obtain necessary capital in order to properly capitalize and continue our operations.

***EU medicine marketing and reimbursement regulations may materially affect our ability to market and obtain reimbursement for our products in the EU Member States.***

We intend to seek approval to market our product candidates in both the United States and in selected foreign jurisdictions. If we obtain approval in one or more foreign jurisdictions for our product candidates, we will be

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subject to rules and regulations in those jurisdictions. In some foreign countries, particularly those in the European Union, the pricing of products is subject to governmental control and other market regulations which could put pressure on the pricing and usage of our product candidates. In these countries, pricing negotiations with governmental authorities can take considerable time after obtaining marketing approval of a product candidate. In addition, market acceptance and sales of our product candidates will depend significantly on the availability of adequate coverage and reimbursement from third-party payors for our product candidates and may be affected by existing and future healthcare reform measures.

Much like the federal Anti-Kickback Statute prohibition in the United States, the provision of benefits or advantages to physicians to induce or encourage the prescription, recommendation, endorsement, purchase, supply, order or use of medicinal products is also prohibited in the European Union. The provision of benefits or advantages to reward improper performance generally is typically governed by the national anti-bribery laws of EU Member States and the Bribery Act 2010 in the United Kingdom. Infringement of these laws could result in substantial fines and imprisonment. EU Directive 2001/83/EC, which is the EU Directive governing medicinal products for human use, further provides that, where medicinal products are being promoted to persons qualified to prescribe or supply them, no gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised to such persons unless they are inexpensive and relevant to the practice of medicine or pharmacy. This provision has been transposed into the Human Medicines Regulations 2012 and so remains applicable in the United Kingdom despite its departure from the European Union.

Payments made to physicians in certain EU Member States must be publicly disclosed. Moreover, agreements with physicians often must be the subject of prior notification and approval by the physician's employer, his or her competent professional organization and/or the regulatory authorities of the individual EU Member States. These requirements are provided in the national laws, industry codes or professional codes of conduct, applicable in the EU Member States. Failure to comply with these requirements could result in reputational risk, public reprimands, administrative penalties, fines or imprisonment.

In addition, in some foreign countries, including some countries in the European Union, the proposed pricing for a product must be approved before it may be lawfully marketed. The requirements governing product pricing and reimbursement vary widely from country to country. For example, some EU Member States may restrict the range of medicinal products for which their national health insurance systems provide reimbursement and control the prices of such products. Reference pricing used by various EU Member States and parallel distribution, or arbitrage between low-priced and high-priced EU Member States, can further reduce prices. An EU Member State may approve a specific price for the medicinal product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the medicinal product on the market. In some countries, we may be required to conduct a clinical trial or other studies that compare the cost-effectiveness of any of our product candidates to other available therapies in order to obtain or maintain reimbursement or pricing approval. There can be no assurance that any country that has price controls or reimbursement limitations for biopharmaceutical products will allow favorable reimbursement and pricing arrangements for any of our products. Historically, products launched in the European Union do not follow price structures of the United States and generally prices tend to be significantly lower. Publication of discounts by third-party payors or authorities may lead to further pressure on the prices or reimbursement levels within the country of publication and other countries. If pricing is set at unsatisfactory levels or if reimbursement of our products is unavailable or limited in scope or amount, our revenues from sales and the potential profitability of any of our product candidates in those countries would be negatively affected.

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***We are subject to export and import controls, economic sanctions, and anti-corruption laws and regulations of the United States and other jurisdictions. We can face criminal liability and other serious consequences for violations of these laws and regulations, which can harm our business.***

We are subject to export control and import laws and regulations, including the U.S. Export Administration Regulations, U.S. Customs regulations, and various economic and trade sanctions regulations administered by the U.S. Treasury Department's Office of Foreign Assets Control. Export controls and trade sanctions laws and regulations may restrict or prohibit altogether the provision, sale, or supply of our products to certain governments, persons, entities, countries, and territories, including those that are the target of comprehensive sanctions or an embargo. We are also subject to anti-corruption and anti-bribery laws, including the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, and other state and national anti-bribery laws in the countries in which we conduct activities. Anti-corruption laws are interpreted broadly and prohibit companies and their employees, agents, contractors, and other partners from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector. The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect the transactions of the corporation and to devise and maintain an adequate system of internal accounting controls. We can be held liable for the corrupt or other illegal activities of our employees, agents, contractors, and other partners, even if we do not explicitly authorize or have actual knowledge of such activities. Any violation of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm, and other consequences.

***If we or any third-party manufacturer we engage now or in the future fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs or liabilities that could have a material adverse effect on our business.***

We and third-party manufacturers we engage now are, and any third-party manufacturer we may engage in the future will be, subject to numerous environmental, health and safety laws and regulations, including those governing laboratory procedures and the handling, use, storage, treatment and disposal of hazardous materials and wastes. Our operations involve the use of hazardous and flammable materials, including chemicals and biological materials. Our operations also produce hazardous waste products. We generally contract with third parties for the disposal of these materials and wastes. We cannot eliminate the risk of contamination or injury from these materials. In the event of contamination or injury resulting from our use of hazardous materials, we could be held liable for any resulting damages, and any liability could exceed our resources. We also could incur significant costs associated with civil or criminal fines and penalties.

Although we maintain general liability insurance as well as workers' compensation insurance to cover us for costs and expenses we may incur due to injuries to our employees resulting from the use of hazardous materials, this insurance may not provide adequate coverage against potential liabilities. We do not maintain insurance for environmental liability or toxic tort claims that may be asserted against us in connection with our storage or disposal of biological, hazardous or radioactive materials.

In addition, we may incur substantial costs in order to comply with current or future environmental, health and safety laws and regulations. These current or future laws and regulations may impair our research, development or commercialization efforts. Failure to comply with these laws and regulations also may result in substantial fines, penalties or other sanctions.

Further, with respect to the operations of our current and any future third-party contract manufacturers, it is possible that if they fail to operate in compliance with applicable environmental, health and safety laws and

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regulations or properly dispose of wastes associated with our products, we could be held liable for any resulting damages, suffer reputational harm or experience a disruption in the manufacture and supply of our product candidates or products. In addition, our supply chain may be adversely impacted if any of our third-party contract manufacturers become subject to injunctions or other sanctions as a result of their non-compliance with environmental, health and safety laws and regulations.

**Risks related to our intellectual property** 

***Our success depends upon our ability to obtain and protect our intellectual property and proprietary information. If we or our licensors are unable to obtain, maintain, defend and enforce patent or other intellectual property protection for any of our current or future product candidates or platform technologies, or if the scope of the patent or other intellectual property protection obtained is not sufficiently broad or enforceable, third parties could develop and commercialize products and technology similar or identical to ours, and our ability to successfully commercialize any of our current or future product candidates and platform technologies may be adversely affected.***

We rely, and may in the future rely, upon a combination of patents, know-how, trademarks, trade secrets, and confidentiality agreements, to protect the intellectual property related to our current and future product candidates and proprietary platform technologies to prevent third parties from exploiting our achievements, thus eroding our competitive position in our market. We also rely on protection afforded by in-licensed intellectual property rights and proprietary technology of third parties. Our success depends in large part on our ability to obtain, maintain, expand, enforce, and defend the scope, ownership or control, validity and enforceability of our intellectual property protection in the United States and other countries with respect to any of our current and future product candidates and other proprietary platform technologies we may develop, as well as our ability to operate without infringing the proprietary rights of others. We generally seek, and may in the future seek, to protect our proprietary position, in part, by filing patent applications in the United States and abroad relating to any of our current and future product candidates and platform technologies, manufacturing processes and methods of use. We also seek to protect, and may seek to protect, our proprietary position by in-licensing or acquiring in the future relevant issued patents, pending patent applications and proprietary technologies from third parties. We will endeavor to seek additional patent protection to cover proprietary features of our product candidates, platform technologies and novel discoveries that are important to our business. Some of our in-licensed patent families were drafted, filed, and prosecuted by our licensors and even where we now control the right to prosecution under the applicable license agreements, we are still required to solicit input and consider comments from such licensors. Additionally, some of our owned and in-licensed patent families are in an early stage of prosecution and cannot be enforced against third parties practicing the technology claimed in such applications unless, and until, patents are issued from such applications, and then only to the extent the issued claims cover the third parties' activities. Our ability to stop third parties from making, using, selling, marketing, offering to sell, importing and commercializing any product candidates or platform technologies we may develop is dependent upon the extent to which our products are covered by valid and enforceable patents or are effectively maintained as trade secrets. If we are unable to obtain, maintain, expand, enforce and defend the scope, ownership or control, validity and enforceability of our intellectual property protection, our business, financial condition, results of operations and prospects could be materially harmed.

Changes in either the patent laws or their interpretation in the United States and other jurisdictions may diminish our ability to protect our intellectual property, obtain, maintain, expand, enforce and defend our intellectual property rights and, more generally, could affect the value of our intellectual property or narrow the scope of our protection. We cannot predict whether the patent applications we currently or may in the future pursue or may in-license will issue as patents in any particular jurisdiction, whether the claims of any

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issued patents will provide sufficient protection against competitors or other third parties, or if these patents are challenged by our competitors, whether the patents will be found to be invalid, unenforceable, or not infringed or not owned or controlled by us. The patent prosecution process is expensive, time-consuming, and complex, and we may not be able to file, prosecute, maintain, enforce, defend or license all necessary or desirable patent applications or patents at a reasonable cost or in a timely manner or in all jurisdictions. It is also possible that we or our licensors will fail, or previously failed, to identify patentable aspects of research and development output in time to obtain patent protection. Although we enter into non-disclosure and confidentiality agreements with parties who have access to confidential or patentable aspects of our research and development output, such as our employees, licensees, third-party collaborators, CROs, contract manufacturers, consultants, advisors and other third parties, any of these parties may breach the agreements and disclose such output before a patent application is filed, thereby jeopardizing our ability to seek patent protection. Consequently, we may not be able to prevent any third party from using any of our technology that is in the public domain from competing with any of our current or future product candidates or platform technologies. In addition, our ability to obtain and maintain valid and enforceable patents depends on whether the differences between our inventions and the prior art allow our inventions to be patentable in light of the prior art. Furthermore, publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all. Therefore, we cannot be certain that we or our licensors were the first to invent the inventions claimed in any of our owned or in-licensed patents or pending patent applications, or that we or our licensors were the first to file for patent protection of such inventions. If a third party can establish that we or our licensors were not the first to invent or the first to file for patent protection of such inventions, our owned or in-licensed patents and patent applications may not issue as patents and even if issued, may be challenged and invalidated or rendered unenforceable.

The patent position of biopharmaceutical companies generally is highly uncertain, involves complex legal and factual questions, and has been the subject of much litigation in recent years. As a result, the issuance, scope, validity, enforceability, and commercial value of our owned and in-licensed patent rights are highly uncertain. Our current and future patent applications may not result in patents being issued.

Further, even if patents are granted, they may not afford sufficient protection of any of our current or future product candidates or proprietary platform technologies or their intended uses against competitors, nor can there be any assurance that the issued patents cannot be designed around, invalidated by third parties, or effectively prevent others from commercializing competitive products or technologies to any of our current or future product candidates or platform technologies. Furthermore, even if granted, the resulting patents may be difficult to enforce. Obtaining and maintaining our owned and in-licensed patent protection depends on compliance with various procedural, document submission, information disclosure, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated if we fail to comply with these requirements. If we experience noncompliance events that cannot be corrected and we lose our patent rights, competitors could enter the market, which would have a material adverse effect on our business. Further, any issued patents that we own or license or may own or license in the future covering any of our current or future product candidates or platform technologies could be narrowed or found invalid or unenforceable if challenged in court or before administrative bodies in the United States or other countries, including the U.S. Patent and Trademark Office ("USPTO"). Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, lack of written description or non-enablement. In addition, patent validity challenges may, under certain circumstances, be based upon non-statutory obviousness-type double patenting, which, if successful, could result in a finding that the claims are invalid for obviousness-type double patenting. In certain circumstances, the finding could be cured by filing a retroactive terminal disclaimer over unexpired reference patent(s), which would result in a reduction of patent term, including a reduction or loss of a patent term

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adjustment granted by the USPTO. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld information material to patentability from the USPTO, or made a misleading statement, during prosecution. Also, patent terms, including any extensions or adjustments that may or may not be available to us, may not protect our competitive position on any of our current or future product candidates or platform technologies for an adequate amount of time, and we may be subject to claims challenging the inventorship, ownership, validity, enforceability of our owned or in-licensed patents and/or other intellectual property. Changes in U.S. patent law, or laws in other countries, could diminish the value of patents in general, thereby impairing our ability to protect any of our current or future product candidates or platform technologies. Further, if we encounter delays in our development and testing, clinical trials or regulatory review and approval of any of our current or future product candidates, the period of time during which we could market such product candidates under patent protection may be reduced, since any patents protecting such product candidates might expire before or shortly after such product candidates are commercialized. Thus, our owned and in-licensed patents may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours or afford us any meaningful competitive advantage.

Moreover, the claim coverage in a patent application can be significantly reduced before the corresponding patent is granted. Even if owned or in-licensed patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us or otherwise provide us with any competitive advantage. Any patents issuing from our owned and in-licensed patent applications may be challenged, narrowed, circumvented or invalidated by third parties. Consequently, we do not know whether any of our current or future product candidates and other proprietary platform technologies will be protectable or remain protected by valid and enforceable patents. Even if a patent is granted, our competitors or other third parties may be able to circumvent the patent by developing similar or alternative technologies or products in a non-infringing manner which could materially adversely affect our business, financial condition, results of operations and prospects. Furthermore, our competitors or other third parties may avail themselves of safe harbors under the Drug Price Competition and Patent Term Restoration Act of 1984 (the "Hatch-Waxman Amendments") to conduct research and clinical trials.

The issuance of a patent is not conclusive as to its inventorship, ownership, scope, validity, or enforceability, and our owned or in-licensed patent rights may be challenged in the courts or patent offices in the United States and abroad. We may be subject to post-grant proceedings at the USPTO challenging the validity of one or more claims of our owned and in-licensed patents. Third-party submissions may also be made prior to a patent's issuance, precluding the granting of a patent based on our pending patent application or patent application we may license in the future. A third party may also claim that our owned and in-licensed patent rights are invalid or unenforceable in a litigation. The outcome following legal assertions of invalidity and unenforceability is unpredictable. In addition, we or our licensors may become involved in opposition, derivation, revocation, reexamination, reissue, interference, inter partes review, post-grant review proceedings or other similar proceedings in the United States and/or foreign jurisdictions challenging our patent rights. An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate or render unenforceable, our owned or in-licensed patent rights, and may allow third parties, including generic drug companies, to commercialize any of our current or future product candidates and use any other proprietary platform technologies we may develop to compete directly with us.

Moreover, some of our in-licensed patent rights are co-owned with third parties or subject to third party rights under the Bayh-Dole Act, and our future owned or in-licensed patent rights may be co-owned with third parties or subject to third party rights. For instance, at least a portion of the patent rights in-licensed from Mayo Foundation for Medical Education and Research may be subject to a U.S. government agency's "March-in

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rights" under 35 U.S.C. §§200-212, and certain preclinical stage product candidates in-licensed from BMS Co. are co-owned by BMS Co. and Université de Montréal, Institut de Recherche en immunologie et en cancérologie – Commercialisation de la Recherche and exclusively licensed to us from BMS Co. In the United States, each co-owner has the freedom to license and exploit the technology. If we are unable to obtain an exclusive license to any such third-party co-owners' interest in such patent rights, such co-owners may be able to license their rights to other third parties, including our competitors, and our competitors could market competing products and technology. In addition, we may need the cooperation of any such co-owners of such patent rights in order to enforce such patent rights against third parties, and such cooperation may not be provided to us. Any of the foregoing could have a material adverse effect on our competitive position, business, financial condition, results of operations and prospects.

***If we fail to comply with our obligations in the agreements under which we license intellectual property rights from third parties or otherwise experience disruptions to our business relationships with our licensors, or if any of our material license agreements are terminated, we could lose our rights to key intellectual property and components enabling our technologies.***

Our commercial success will heavily depend on the maintenance of our license agreements. We are a party to license agreements with Ionis, MyoKardia, BMS Co., Sanofi, and Mayo that are important to our business. If, for any reason, our license agreements are terminated or we otherwise lose some or all of the rights under such agreements, it would adversely affect our business. For example, our license agreements with Mayo, MyoKardia, BMS Co. and Ionis, pursuant to which, we have exclusive and worldwide rights to develop and commercialize our product candidates, impose, and future agreements may impose, various development, diligence, commercialization, milestone payment, royalty and other obligations on us and require us to meet development, regulatory or commercialization timelines, or to exercise commercially reasonable efforts to develop and commercialize licensed products, in order to maintain the licenses. If we fail to satisfy any obligations under such license agreements, the applicable licensor may terminate our license, which could have a material adverse effect on us.

The agreements under which we license intellectual property or technology from third parties are complex, and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations, and prospects. For example, disputes may arise regarding the payment of the royalties or other payments due to licensors in connection with the rights we license from them. Licensors may contest the basis of such payments, including the royalties we retained and claim that we are obligated to make payments under a broader basis. In addition, disputes may arise between us and our current or future licensors regarding intellectual property subject to a license agreement, including:

• the scope of rights granted under the license agreement and other interpretation-related issues;

• whether and the extent to which our technology and processes infringe, misappropriate or otherwise violate intellectual
property of the licensor that is not subject to the licensing agreement;

• our right to sublicense patents and other rights to third parties under our license arrangements;

• our right to transfer or assign the license;

• our diligence obligations under the license agreement and what activities satisfy those diligence obligations;

• our financial or other obligations under the license agreement;

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• the priority of invention of patented technology; and

• the inventorship and ownership of inventions and know-how resulting from the joint
creation or use of intellectual property by our current or future licensors and us and our partners.

Such disputes may be costly to resolve and may divert management's attention away from day-to-day activities. In addition to the costs of any litigation we may face, any legal action against us could increase our payment obligations under the respective agreement and require us to pay interest and potentially damages to such licensors. If disputes over intellectual property that we have in-licensed, or in-license in the future, prevent or impair our ability to maintain our licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize the affected product candidates or platform technologies, which could have a material adverse effect on our business, financial condition, results of operations, and prospects.

Despite our best efforts, our current or future licensors might conclude that we materially breached our license agreements and might therefore terminate the license agreements, thereby removing our ability to develop and commercialize products, if approved, and technology covered by these license agreements. Such termination would result in the ability of the prior licensor to assert the prior licensed patents against us, or the prior licensor could license the patents to a competitor who could assert the prior licensed patents against us. As a result, we may be required to cease our development, manufacture and commercialization of our product candidates and use of our proprietary platform technologies covered by the patent rights owned by the licensors, which could have a material adverse effect on us. Alternatively, the prior licensor could abandon the patent rights, which would reduce the barrier to entry into the market. If these in-licenses are terminated, or if the in-licensed patents fail to provide the intended exclusivity, and if competitors circumvent any regulatory exclusivity, competitors would have the freedom to market products identical to ours. These events could have a material adverse effect on our competitive position, business, financial condition, results of operations and prospects.

Termination of these agreements or reduction or elimination of our rights under these agreements may result in our having to negotiate new or reinstated agreements with less favorable terms or cause us to lose our rights under these agreements, including our rights to important intellectual property or technology. For example, we may agree to terms that could enable third parties (potentially including our competitors) to receive licenses to a portion of the intellectual property that is subject to our existing licenses. Any of these events could have a material adverse effect on our competitive position, business, financial conditions, results of operations, and prospects, and we may be required to identify and license replacement technology from third parties, which may not be available on reasonable terms, if at all.

Further development of our proprietary platform technologies and product candidates may require us to enter into additional license or collaboration agreements. Our future licenses may not provide us with commercially reasonable terms, exclusive rights to use the licensed intellectual property and technology, or exclusive rights to use such intellectual property and technology in all relevant fields of use and in all territories in which we may wish to develop or commercialize our product candidates and platform technologies in the future.

For a more complete description of these agreements, see the section titled "*Business—License and Collaboration Agreements*" in this prospectus.

***We may in the future enter into collaborations and further strategic alliances to maximize the potential of our product candidates or platform technologies, and we may not realize the anticipated benefits of such collaborations or alliances. We may continue to form collaborations or alliances in the future with respect to any of our current or future product candidates or platform technologies, but may be unable to do so or to***

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 ***realize the potential benefits of such transactions, which may cause us to alter or delay our development and commercialization plans.***

We have entered into license agreements, and may in the future seek to enter into collaborations, strategic alliances, joint ventures, additional licenses and other similar arrangements for the development or, if approved, commercialization of any of our current and future product candidates due to capital costs required to develop or commercialize such product candidates or otherwise. We may not be successful in our efforts to establish or maintain collaborations or other similar arrangements because our research and development pipeline may be insufficient, future product candidates may be deemed to be at too early of a stage of development for collaborative effort or third parties may not view any of our current or future product candidates as having the requisite potential to demonstrate safety and potency (or efficacy), or significant commercial opportunity.

We may have conflicts with our future collaborators, such as conflicts concerning the interpretation of preclinical or clinical data, the achievement of milestones, the interpretation of contractual obligations, payments for services, development obligations, or the ownership of intellectual property developed during our collaboration. Moreover, a collaborator with marketing and distribution rights to one or more products may not commit sufficient resources to the marketing and distribution of such product or products. If any conflicts arise with any of our future collaborators, such collaborator may act in a manner that is adverse to our best interests. Any such disagreement could result in one or more of the following, each of which could delay or prevent the development or commercialization of our product candidates, and in turn prevent us from generating revenue: disputes regarding milestone payments or royalties; uncertainty regarding ownership of intellectual property rights arising from our collaborative activities, which could prevent us from entering into additional collaborations; unwillingness by the collaborator to cooperate in the development or manufacture of a product candidate, including providing us with data or materials; unwillingness on the part of a collaborator to keep us informed regarding the progress of its development and commercialization activities or to permit public disclosure of the results of those activities; initiating of litigation or alternative dispute resolution options by either party to resolve the dispute; or attempts by either party to terminate the agreement.

In addition, we face significant competition in seeking appropriate strategic partners, and the negotiation process can be time-consuming and complex. Even if we are successful in our efforts to establish or maintain such collaborations, the terms that we agree upon may not be favorable to us. As a result, we may need to relinquish valuable rights to our future revenue streams, research and development programs, intellectual property, any of our current or future product candidates, or grant licenses on terms that may not be favorable to us, as part of any such arrangement, and such arrangements may restrict us from entering into additional agreements with other potential collaborators. In addition, our future collaborations may limit our control over the amount and timing of resources that our collaborators will dedicate to the development or commercialization of any of our current or future product candidates. Our ability to generate revenue from these arrangements will depend on any future collaborators' abilities to successfully perform the functions assigned to them in these arrangements. We cannot be certain that, following a collaboration, license, or strategic transaction, we will achieve an economic benefit that justifies such transaction, and such transaction may not yield additional development product candidates for our pipeline. Furthermore, we may not be able to maintain such collaborations if, for example, the development or approval of any current or future product candidates are delayed, the safety of any such product candidate is questioned, or the sales of any of our current or future product candidates, if approved, are unsatisfactory.

In addition, future collaborations may be terminable by our collaborators and strategic partners, and we may not be able to adequately protect our rights under these agreements. Furthermore, strategic partners may negotiate for certain rights to control decisions regarding the development and, if approved, commercialization of any of our current or future product candidates, and may not conduct those activities in the same manner as

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we do. Any termination of our collaborations we enter into in the future, or any delay in entering into collaborations related to any of our current or future product candidates, could delay the development and, if approved, commercialization of such product candidates, and reduce their competitiveness if they reach the market, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

***We may not be able to protect our intellectual property and proprietary rights throughout the world.***

Filing, prosecuting, maintaining, enforcing and defending patents on any of our current or future product candidates or platform technologies in all countries throughout the world is expensive, and the laws of foreign countries may not protect our intellectual property rights to the same extent as the laws of the United States. Prosecution of foreign patent applications is often a longer process, and patents may grant at a later date, and with a shorter term, than in the United States. The requirements for patentability differ in certain jurisdictions and countries. Additionally, the patent laws of some countries do not afford intellectual property protection to the same extent as the laws of the United States. For example, other countries may impose substantial restrictions on the scope of claims, including limiting patent protection to specifically disclosed embodiments. Consequently, we may not be able to prevent third parties from practicing our inventions in all countries outside the United States, or from selling or importing products made using our intellectual property in and into the United States or other jurisdictions. Competitors may use our intellectual property in jurisdictions where we have not pursued and obtained patent protection to develop their own products and, further, may export infringing products to territories where we have patent protection, but enforcement is not as strong as that in the United States. These products may compete with our products, and our current or future owned and in-licensed patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents, trade secrets and other intellectual property protection, particularly those relating to biopharmaceutical products, which could make it difficult for us to stop the infringement of our owned and in-licensed patents or marketing of competing products in violation of our intellectual property and proprietary rights generally. In addition, some jurisdictions, such as Europe, Japan and China, may have a heightened standard for patentability than in the United States, including, for example, the requirement of claims having literal support in the original patent filing and the limitation on using supporting data that is not in the original patent filing. Under those heightened patentability requirements, we may not be able to obtain sufficient patent protection in certain jurisdictions even though the same or similar patent protection can be secured in the United States and other jurisdictions.

Proceedings to enforce our owned and in-licensed intellectual property and proprietary rights in the United States or other jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business, could put our current patents and any patents we may own or license in the future at risk of being invalidated or interpreted narrowly, could put our owned and in-licensed patent applications at risk of not issuing, and could provoke third parties to assert claims against us. We may not prevail in any lawsuits that we initiate, and the damages or other remedies awarded, if any, may not be commercially meaningful. Accordingly, our efforts to enforce our owned and in-licensed intellectual property and proprietary rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop.

Many countries have compulsory licensing laws under which a patent owner or exclusive licensee may be compelled to grant licenses to third parties, including governmental agencies. In addition, many countries limit the enforceability of patents against government agencies or government contractors. In these countries, the patent owner or exclusive licensee may have limited remedies, which could materially diminish the value of such patent protection. If we are forced to grant a license to third parties with respect to any patents relevant

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to our business, our competitive position may be impaired, and our business, financial condition, results of operations and prospects may be adversely affected. In addition, geo-political actions in the United States and in foreign countries (such as the Russia and Ukraine conflict) could increase the uncertainties and costs surrounding the prosecution or maintenance of our patent applications or those of any licensors and the maintenance, enforcement or defense of our issued patents which could impair our competitive intellectual property position. For example, the United States and foreign government actions related to Russia's conflict in Ukraine may limit or prevent filing, prosecution, and maintenance of patent applications in Russia. In addition, a decree was adopted by the Russian government in March 2022, allowing Russian companies and individuals to exploit inventions owned by patentees from the United States without consent or compensation. Consequently, we would not be able to prevent third parties from practicing our inventions in Russia or from selling or importing products made using our inventions in and into Russia.

***Obtaining and maintaining our owned and in-licensed patent protection depends on compliance with various procedural, document submission, fee payment, and other requirements imposed by government patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.***

The USPTO and various non-U.S. government agencies require compliance with several procedural, documentary, fee payment and other similar provisions during the patent application process. In some circumstances, we may be dependent on our licensors to take the necessary action to comply with these requirements with respect to any in-licensed intellectual property. For example, periodic maintenance fees, renewal fees, annuity fees, and various other government fees on patents and applications will be due to be paid to the USPTO and various government patent agencies outside of the United States over the lifetime of our owned and in-licensed patents and applications. In certain circumstances, we may rely on licensing partners to pay these fees due to the U.S. and non-U.S. patent agencies. In some cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. There are situations, however, in which non-compliance can result in abandonment or lapse of the patent or patent application, resulting in a partial or complete loss of patent rights in the relevant jurisdiction. In such an event, potential competitors might be able to enter the market with similar or identical products or technology, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

The USPTO and various non-U.S. government agencies require compliance with certain foreign filing requirements during the patent application process. For example, in some countries, including the United States, China, India and some European countries, a foreign filing license is required before certain patent applications are filed. The foreign filing license requirements vary by country and depend on various factors, including where the inventive activity occurred, citizenship status of the inventors, the residency of the inventors and the invention owner, the place of business for the invention owner and the nature of the subject matter to be disclosed (e.g., items related to national security or national defense). In some, but not all cases, for example in China and India, a foreign filing license cannot be obtained retroactively in accordance with the applicable rules. There are situations, however, in which non-compliance can result in abandonment of a pending patent application or can be grounds for revoking or invalidating an issued patent, resulting in the loss of patent rights in the relevant jurisdiction. Non-compliance events that could result in abandonment or lapse of a patent or patent application include, but are not limited to, failure to respond to official actions within prescribed time limits, non-payment of fees and failure to properly legalize and submit formal documents. In such an event, potential competitors might be able to enter the relevant markets with similar or identical products or technology, which could have a material adverse effect on our business, financial condition, results of operations and prospects. We may also be dependent on licensors to take the necessary actions to comply with these requirements with respect to our in-licensed intellectual property.

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Public health pandemics (such as the COVID-19 pandemic), geopolitical instability (war and terrorism), natural disasters, or similar events may impair our and our licensors' ability to comply with these procedural, document submission, fee payment, and other requirements imposed by government patent agencies, which may materially and adversely affect our ability to obtain or maintain patent protection for any of our current and future product candidates or platform technologies.

***Changes in patent laws or their interpretations could diminish the value of patents in general, thereby impairing our ability to protect our products.***

Changes in either the patent laws or interpretation of the patent laws in the United States or in other countries could increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. Assuming that other requirements for patentability are met, prior to March 2013, in the United States, the first to invent the claimed invention was entitled to the patent, while outside the United States, the first to file a patent application was entitled to the patent. After March 2013, under the Leahy-Smith America Invents Act (the "America Invents Act") enacted in September 2011, the United States transitioned to a first inventor to file system in which, assuming that other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention. A third party that files a patent application in the USPTO after March 2013, but before us or our licensors could therefore be awarded a patent covering an invention of ours or our licensors even if we or our licensors had made the invention before it was made by such third party. This requires us to be cognizant of the time from invention to filing of a patent application. Since patent applications in the United States and most other countries are confidential for a period of time after filing or until issuance, we cannot be certain that we or our licensors are the first to either (i) file any patent application related to any of our current or future product candidates and other proprietary platform technologies we may develop or (ii) invent any of the inventions claimed in our patents or patent applications.

The America Invents Act also included a number of significant changes that affect the way patent applications are prosecuted and also affect patent litigation. These include allowing third party protests and submission of prior art to the USPTO during patent prosecution and additional procedures to attack the validity of a patent by USPTO-administered post-grant proceedings, including post-grant review, inter partes review and derivation proceedings. Because of a lower evidentiary standard in USPTO proceedings compared to the evidentiary standard in U.S. federal courts necessary to invalidate a patent claim, a third party could potentially provide evidence in a USPTO proceeding sufficient for the USPTO to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if first presented in a district court action. Accordingly, a third party may attempt to use the USPTO procedures to invalidate our owned or in-licensed patent claims or any patent claims we may license in the future that would not have been invalidated if first challenged by the third party as a defendant in a district court action.

In addition, the patent positions of companies in the development and commercialization of pharmaceuticals are particularly uncertain. Recent U.S. Supreme Court rulings have narrowed the scope of patent protection available in certain circumstances and weakened the rights of patent owners in certain situations. We cannot predict how decisions by the courts, the U.S. Congress or the USPTO may impact the value of our owned and in-licensed patent rights. For example, the U.S. Supreme Court held in *Amgen v. Sanofi* (2023) that a functionally claimed genus was invalid for failing to comply with the enablement requirement of the Patent Act. As such, our owned and in-licensed patent rights that grant with functional claims may be vulnerable to third party challenges seeking to invalidate these claims for lacking enablement or adequate support in the specification. Depending on future actions by the U.S. Congress, the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that could have a material adverse effect on our existing patent portfolio and our ability to protect and enforce our intellectual property in the future. In

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addition to heightened patentability requirements, the Supreme Court and Federal Circuit's interpretation of biosimilar product approval under the BPCIA, has evolved in recent years, affecting the "patent dance" provisions of the statute, which are intended to resolve any patent infringement issues before the approval of a biosimilar. Similarly, changes in patent law and regulations in other countries or jurisdictions or changes in the governmental bodies that enforce them or changes in how the relevant governmental authority enforces patent laws or regulations may weaken our ability to obtain new patents or to enforce patents that we have or may obtain or license in the future.

In 2012, the European Union Patent Package ("EU Patent Package") regulations were passed with the goal of providing a single pan-European Unitary Patent and a new European Unified Patent Court ("UPC") for litigation involving European patents. The EU Patent Package was implemented on June 1, 2023, and has become a common forum for challenging European patents. As a result, all European patents, including those issued prior to ratification of the EU Patent Package, now by default automatically fall under the jurisdiction of the UPC, unless otherwise opted out. It is uncertain how the UPC will impact granted European patents in the biotechnology and pharmaceutical industries. Our European patents and patent applications, if issued, could be challenged in the UPC. During the first seven years of the UPC's existence, the UPC legislation allows a patent owner to opt its European patents out of the jurisdiction of the UPC. We may decide to opt out our future European patents from the UPC, but doing so may preclude us from realizing the benefits of the UPC. Moreover, if we do not meet all of the formalities and requirements for opt-out under the UPC, our future European patents could remain under the jurisdiction of the UPC. The UPC will provide our competitors with a new forum to centrally revoke our European patents and allow for the possibility of a competitor to obtain a pan-European injunction. Such a loss of patent protection could have a material adverse impact on our business and our ability to commercialize our current and future platform technologies and any of our current and future product candidates due to increased competition and, resultantly, on our business, financial condition, results of operations and prospects. The UPC and Unitary Patent are significant changes in European patent practice. As the UPC is a new court system, there is limited precedent for the court, increasing the uncertainty of any litigation in the UPC.

***Issued patents covering any of our current or future product candidates or platform technologies could be found invalid or unenforceable if challenged in court or before administrative bodies in the United States or abroad.***

Our owned and in-licensed patent rights may be subject to priority, validity, inventorship, ownership and enforceability disputes. Legal proceedings relating to intellectual property claims, with or without merit, are unpredictable and generally expensive and time-consuming and likely to divert significant resources from our core business, including distracting our management and scientific personnel from their normal responsibilities and generally harm our business. If we or any of our licensors are unsuccessful in any of these proceedings, such patents and patent applications may be narrowed, invalidated or held unenforceable. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

If we initiate legal proceedings against a third party to enforce a patent covering any of our current or future product candidates or platform technologies, the defendant could counterclaim that such patent is invalid or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. Grounds for a validity challenge could include an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness, non-enablement, lack of sufficient written description, failure to claim patent-eligible subject matter or obviousness-type double patenting. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO, or made a misleading or inconsistent statement, during prosecution. Third parties may raise claims challenging the validity or enforceability of a patent before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post-grant review, inter partes review, interference proceedings, derivation

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proceedings, and equivalent proceedings in foreign jurisdictions (e.g., opposition proceedings). Such proceedings could result in the revocation of, cancellation of, shortening the term of or amendment to our owned or in-licensed patent rights or any patent rights we may obtain or license in the future in such a way that they no longer cover any of our current or future product candidates or platform technologies or prevent third parties from competing with our product candidates or platform technologies. The outcome following legal assertions of invalidity and unenforceability is unpredictable. With respect to the validity question, for example, we cannot be certain that there is no invalidating prior art, of which we or our licensors and the patent examiner were unaware during prosecution. If a third party were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection for any of our current or future product candidates or platform technologies. There is also a risk that, even if the validity of such patents is upheld, the court will construe the patent's claims narrowly or decide that we do not have the right to stop the other party from using the invention at issue on the grounds that our owned and in-licensed patent claims do not cover the invention, or decide that the other party's use of our patented technology falls under the safe harbor to patent infringement under 35 U.S.C. § 271(e). Such a loss of patent protection would have a material adverse impact on our business, financial condition, results of operations and prospects.

***Patent terms may be inadequate to protect the competitive position of any of our current or future product candidates or platform technologies for an adequate amount of time.***

Patents have a limited lifespan. In the United States, if all maintenance fees are timely paid, the natural expiration of a patent is generally 20 years from its earliest U.S. non-provisional or international patent application filing date. Various extensions may be available, but the life of a patent, and the protection it affords, is limited. Even if patents covering any of our current or future product candidates or platform technologies are obtained, once the patent has expired, we may be vulnerable to competition from competitive products, including generics. Given the amount of time required for the development, testing and regulatory review of any of our current or future product candidates or platform technologies, patents protecting such product candidates or platform technologies might expire before or shortly after such product candidates or platform technologies are commercialized. As a result, our intellectual property may not provide us with sufficient rights to exclude others from commercializing products similar or identical to our product candidates or platform technologies. If we do not have sufficient patent life to protect our products, our business, financial condition, results of operations and prospects will be adversely affected.

***If we do not obtain patent term extension and equivalent extensions outside of the United States for any of our current or future product candidates, our business may be materially harmed.***

Depending upon the timing, duration and specifics of any FDA regulatory approval of any of our current or future product candidates, one or more of our owned or in-licensed U.S. patents may be eligible for limited patent term extension under the Hatch-Waxman Amendments. The Hatch-Waxman Amendments permit a patent term extension of up to five years as compensation for patent term lost during the FDA regulatory review process. A patent term extension cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval, only one patent may be extended, and only those claims covering the approved drug, a method for using it or a method of manufacturing it may be extended. Similar patent term restoration provisions to compensate for commercialization delay caused by regulatory review are also available in certain foreign jurisdictions, such as in Europe under Supplemental Protection Certificate. However, we may not be granted an extension for various reasons, including failing to exercise due diligence during the testing phase or regulatory review process, failing to apply within applicable deadlines, failing to apply prior to expiration of relevant patents, or failing to satisfy other applicable requirements. Moreover, the applicable time period afforded could be less than we request. In addition, to the extent we wish to pursue patent term extension based on a patent that we may license from a third party in the future, we may need the cooperation of that third party. If we are unable to obtain patent term extension, or the foreign equivalent, or if the term of

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any such extension is less than we request, our competitors may obtain approval of competing products following our patent expiration, and our business, financial condition, results of operations and prospects could be materially harmed.

***We or our licensors may be subject to claims challenging the inventorship or ownership of our owned and in-licensed patents and other intellectual property.***

We or our licensors may be subject to claims that former employees, consultants, licensees, collaborators or other third parties have an interest in our owned or in-licensed patent rights, trade secrets, or other intellectual property as an inventor, co-inventor or owner of trade secrets. For example, we or our licensors may have inventorship or ownership disputes arise from conflicting obligations of consultants or others who are involved in developing any of our current or future product candidates and other proprietary platform technologies we may develop. We or our licensors may have relied on third-party consultants or collaborators or on funds from third parties, such as from a government entity, such that we or our licensors are not the sole and exclusive owners of the patents we in-licensed. The failure to name the proper inventors on a patent application can result in the patents issuing therefrom being unenforceable. Inventorship disputes may arise from conflicting views regarding the contributions of different individuals named as inventors, the effects of foreign laws where foreign nationals are involved in the development of the subject matter of the patent, conflicting obligations of third parties involved in developing our product candidates or platform technologies or as a result of questions regarding co-ownership of potential joint inventions. Litigation may be necessary to defend against these and other claims challenging inventorship or ownership of our owned or in-licensed patent rights, trade secrets or other intellectual property. If we or our licensors fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights, such as ownership of, or the right to use intellectual property that is important to any of our current or future product candidates and other proprietary platform technologies we may develop. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to our management and other employees. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

***If we are unable to protect the confidentiality of our and licensors' trade secrets, our business and competitive position would be harmed.***

In addition to seeking patent protection for any of our current or future product candidates and proprietary platform technologies, we may rely on trade secret protection and confidentiality agreements to protect our unpatented know-how, technology, and other proprietary information and to maintain our competitive position. We seek to protect these trade secrets and other proprietary technology, in part, by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, licensees, third-party collaborators, CROs, contract manufacturers, consultants, advisors and other third parties. We also enter into confidentiality and invention or patent assignment agreements with our employees and consultants. Trade secrets and know-how can be difficult to protect. We cannot guarantee that we have entered into applicable agreements with each party that may have or have had access to our trade secrets or proprietary technology and processes. Despite these efforts, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Monitoring unauthorized uses and disclosures is difficult, and we do not know whether the steps we have taken to protect our proprietary technologies will be effective. We cannot guarantee that any potential trade secrets and other proprietary and confidential information will not be disclosed or that competitors will not otherwise gain access to trade secrets. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret (such as through a cybersecurity breach) is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. If any of our trade secrets were to be

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lawfully obtained or independently developed by a competitor or other third party, we would have no right to prevent them from using that technology or information to compete with us. Furthermore, others may independently discover similar trade secrets and proprietary information. If any of our trade secrets were to be disclosed or misappropriated or if any such information were to be independently developed by a competitor or other third party, our competitive position would be materially and adversely harmed. Additionally, we may need to share our proprietary information, including trade secrets, with current or future business partners, collaborators, contractors and others located in countries at heightened risk of theft of trade secrets, including through direct intrusion by private parties or foreign actors, and those affiliated with or controlled by state actors.

We may be subject to claims that third parties have an ownership interest in our trade secrets. For example, we may have disputes arise from conflicting obligations of our employees, consultants or others who are involved in developing any of our current or future product candidates or platform technologies. Litigation may be necessary to defend against these and other claims challenging ownership of our trade secrets. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable trade secret rights, such as exclusive ownership of, or right to use, trade secrets that are important to any of our current or future product candidates and other proprietary platform technologies we may develop. Such an outcome could have a material adverse effect on our business. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to our management and other employees. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

***We may be subject to claims that our employees, consultants, or advisors have wrongfully used or disclosed alleged trade secrets of their current or former employers or claims asserting ownership of what we regard as our own intellectual property.***

Some of our employees, consultants and advisors are currently or were previously employed at universities or other biotechnology or pharmaceutical companies, including our competitors or potential competitors. Although we try to ensure that our employees, consultants and advisors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or these individuals have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such individual's current or former employer, or that we caused an employee to breach the terms of his or her non-competition or non-solicitation agreement. Litigation may be necessary to defend against these claims. If we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to our management.

In addition, while it is our policy to require our employees and contractors who may be involved in the conception or development of intellectual property to execute agreements assigning such intellectual property to us, we may be unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that we regard as our own. The assignment of intellectual property rights may not be self- executing, or the assignment agreements may be breached, and we may be forced to bring claims against third parties, or defend claims that they may bring against us, to determine the ownership of what we regard as our intellectual property. Such claims could have a material adverse effect on our business, financial condition, results of operations and prospects.

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***We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might adversely affect our ability to develop and market any of our current or future product candidates or platform technologies.***

We cannot guarantee that any of our or our licensors' patent searches or analyses, including the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are or will be complete or thorough, nor can we be certain that we or our licensors have identified or will identify each and every third-party patent and pending patent application in the United States and abroad that is relevant to or necessary for the commercialization of any of our current or future product candidates or platform technologies in any jurisdiction. Patent applications in the United States and elsewhere are not published until approximately 18 months after the earliest filing for which priority is claimed, with such earliest filing date being commonly referred to as the priority date. Therefore, patent applications covering any of our current or future product candidates or platform technologies could have been filed by others without our knowledge. The scope of a patent claim is determined by the interpretation of the law, the words of a patent claim, the written disclosure in a patent and the patent's prosecution history. Our interpretation of the relevance or the scope of a patent or a pending patent application may be incorrect, which may negatively impact our ability to market our products. We may incorrectly determine that any of our current or future product candidates or platform technologies are not covered by a third-party patent or may incorrectly predict whether a third party's pending patent application will issue with claims of relevant scope. Alternatively, we may incorrectly determine that the Hatch-Waxman Amendments are a defense for a safe harbor to infringement of a patent we consider relevant to the research or clinical development of any of our current or future product candidates. Our determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, and we may incorrectly conclude that a third-party patent is invalid and unenforceable or not infringed. Our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market any of our current or future product candidates or platform technologies. If we fail to identify and correctly interpret relevant patents, we may be subject to infringement claims. Also, because the claims of published patent applications can change between publication and patent grant, there may be published patent applications that may ultimately issue with claims that we infringe. As the number of competitors in the market grows and the number of patents issued in this area increases, the possibility of patent infringement claims escalates. Moreover, in recent years, individuals and groups that are non-practicing entities, commonly referred to as "patent trolls," have purchased patents and other intellectual property assets for the purpose of making claims of infringement in order to extract settlements. From time to time, we may receive threatening letters, notices or "invitations to license," or may be the subject of claims that our products and business operations infringe or violate the intellectual property rights of others. We cannot guarantee that we will be able to successfully settle or otherwise resolve such infringement claims. If we fail in any such dispute, in addition to being forced to pay damages, we may be temporarily or permanently prohibited from commercializing any of our current or future product candidates or platform technologies that are held to be infringing. We might, if possible, also be forced to redesign any of our current or future product candidates or platform technologies or services so that we no longer infringe the third-party intellectual property rights. Any of these events, even if we were ultimately to prevail, could require us to divert substantial financial and management resources that we would otherwise be able to devote to our business.

***Third-party claims of intellectual property infringement, misappropriation, or other violations against us or our collaborators could be expensive and time-consuming and may prevent or delay the development and commercialization of any of our current or future product candidates or platform technologies.***

Our commercial success depends in part on our and our collaborators' ability to avoid infringing, misappropriating and otherwise violating the patents and other intellectual property rights of third parties. There is a substantial amount of complex litigation involving patents and other intellectual property rights in

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the biotechnology and pharmaceutical industries, as well as administrative proceedings for challenging patents, including interference, derivation, inter partes review, post-grant review, and reexamination proceedings before the USPTO or oppositions and other comparable proceedings in foreign jurisdictions.

Numerous U.S. and foreign-issued patents and pending patent applications owned by third parties exist in the fields in which we plan to commercialize our programs (including product candidates and platform technologies) and in which we are developing other proprietary technologies. As the biotechnology and pharmaceutical industries expand and more patents are issued, and as we gain greater visibility and market exposure as a public company, the risk increases that our programs and commercializing activities may give rise to claims of infringement of the patent rights of others. We cannot guarantee that our product candidates, platform technologies and other proprietary technologies we develop will not infringe existing or future patents owned by third parties. We may not be aware of patents that have already been issued for which a third party, such as a competitor in the fields in which we are developing our product candidates, platform technologies and other proprietary technologies, might assert as infringed by us. It is also possible that patents owned by third parties of which we are aware, but which we do not believe we infringe or that we believe we have valid defenses to any claims of patent infringement, could be found to be infringed by us. It is not unusual that corresponding patents issued in different countries have different scopes of coverage, such that in one country a third-party patent does not pose a material risk, but in another country, the corresponding third-party patent may pose a material risk to any of our current or future product candidates. In addition, because patent applications can take many years to issue, there may be currently pending patent applications that may later result in issued patents that we may infringe. For example, pending patent applications that have been published can, subject to certain limitations, be later amended in a manner that could cover any of our current or future product candidates or platform technologies or the use of any such product candidates or platform technologies.

If any third-party claims that we infringe their patents or that we are otherwise employing their proprietary technology without authorization and initiates litigation against us, even if we believe such claims are without merit, a court could hold that such patents are valid, enforceable and infringed by us. Defense of infringement claims, regardless of their merit, would involve substantial litigation expense and would be a substantial diversion of management and other employee resources from our business, and may impact our reputation. If a successful claim of infringement against us, we may be enjoined from further developing or commercializing the infringing products or technologies. In addition, we may be required to pay substantial damages, including treble damages and attorneys' fees for willful infringement, obtain one or more licenses from third parties, pay royalties and/or redesign our infringing products or technologies, which may be impossible or require substantial time and monetary expenditure. Such licenses may not be available on commercially reasonable terms or at all. Even if we are able to obtain a license, the license would likely obligate us to pay license fees or royalties or both, and the rights granted to us might be nonexclusive, which could result in our competitors gaining access to the same intellectual property. If we are unable to obtain a necessary license to a third-party patent on commercially reasonable terms or at all, we may be unable to commercialize the infringing products or technologies or such commercialization efforts may be significantly delayed, which could in turn significantly harm our business. In addition, we may in the future pursue patent challenges with respect to third-party patents, including as a defense against the foregoing infringement claims. The outcome of such challenges is unpredictable.

Even if resolved in our favor, the foregoing proceedings could be very expensive, particularly for a company of our size, and time-consuming. Such proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such proceedings adequately. Some of our competitors may be able to sustain the costs of litigation or administrative proceedings more effectively than we can because of greater financial resources. Such proceedings may also absorb significant time of our

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technical and management personnel and distract them from their normal responsibilities. Uncertainties resulting from such proceedings could impair our ability to compete in the marketplace. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.

We may in the future pursue invalidity proceedings with respect to third-party patents. The outcome following legal assertions of invalidity is unpredictable. Even if resolved in our favor, these legal proceedings may cause us to incur significant expenses and could distract our technical and management personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such proceedings adequately. Some of these third parties may be able to sustain the costs of such proceedings more effectively than we can because of their greater financial resources. Uncertainties resulting from the initiation and continuation of patent proceedings could compromise our ability to compete in the marketplace. If we do not prevail in the patent proceedings the third parties may assert a claim of patent infringement directed at any of our current or future product candidates or platform technologies.

***We may become involved in lawsuits to protect or enforce our owned and in-licensed patents and other intellectual property rights, which could be expensive, time-consuming, and unsuccessful.***

Third parties, such as competitors, may infringe our owned or in-licensed patent rights. In an infringement proceeding, a court may decide that a patent we own or in-license is invalid or unenforceable or may refuse to stop the other party from using the invention at issue. In addition, our owned or in-licensed patent rights may become involved in inventorship, ownership, priority, enforceability, or validity disputes. To counter or defend against such claims can be expensive and time-consuming. An adverse result in any litigation proceeding could put our patent rights at risk of being invalidated, held unenforceable or interpreted narrowly. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation and proceedings, there is a risk that some of our confidential information could be compromised by disclosure during such litigation and proceedings.

Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and developed intellectual property portfolios. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace.

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***If our trademarks and trade names are not adequately protected, then we may not be able to build name recognition in our markets of interest and our business may be adversely affected.***

Our registered or unregistered trademarks or trade names may be challenged, infringed, diluted, circumvented or declared generic or determined to be infringing, misappropriating or violating other marks. We may not be able to protect our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers in the markets of interest. During trademark registration proceedings, we may receive rejections of our applications by the USPTO or in other foreign jurisdictions. Although we are given an opportunity to respond to such rejections, we may be unable to overcome them. If our trademarks are successfully challenged or determined to be infringing, misappropriating or violating other marks, we could be forced to rebrand our products, which could result in loss of brand recognition, and could require us to devote resources to advertising and marketing new brands. In addition, in the USPTO and in comparable agencies in many foreign jurisdictions, third parties are given an opportunity to oppose pending trademark applications and to seek to cancel registered trademarks. Opposition or cancellation proceedings may be filed against our trademarks, which may not survive such proceedings. Moreover, any name we may propose to use with any of our current or future product candidates in the United States must be approved by the FDA, regardless of whether we have registered it, or applied to register it, as a trademark. Similar requirements exist in Europe. The FDA typically conducts a review of proposed product names, including an evaluation of potential for confusion with other product names. If the FDA or an equivalent administrative body in a foreign jurisdiction objects to any of our proposed proprietary product names, we may be required to expend significant additional resources to identify a suitable substitute name that would qualify under applicable trademark laws, not infringe, misappropriate or otherwise violate the existing rights of third parties and be acceptable to the FDA. Furthermore, in many countries, owning and maintaining a trademark registration may not provide an adequate defense against a subsequent infringement claim asserted by the owner of a senior trademark.

We may not be able to obtain, protect or enforce our rights to these trademarks and trade names, which we need to build name recognition among potential partners or customers in our markets of interest. At times, competitors or other third parties may adopt trade names or trademarks similar to ours, thereby impeding our ability to build brand identity and possibly leading to market confusion. In addition, there could be potential trade name or trademark infringement, misappropriation, dilution or other claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. Over the long term, if we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business may be adversely affected. Our efforts to obtain, enforce or protect our proprietary rights related to trademarks, trade names, domain name, or other intellectual property may be ineffective and could result in substantial costs and diversion of resources and could adversely affect our business, financial condition, results of operations and prospects.

***Intellectual property rights do not necessarily address all potential threats.***

The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations and may not adequately protect our business or permit us to maintain our competitive advantage. For example:

• others may be able to make products that are similar or identical to any of our current or future product candidates or
utilize similar technology but that are not covered by the claims of the patents that we currently or may in the future own or in-license;

• we or our licensors or collaborators might not have been the first to make the inventions covered by our current or future
patent applications;

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• we or our licensors or collaborators might not have been the first to file patent applications covering our or their
inventions;

• others may independently develop similar or alternative technologies or duplicate any of our technologies without
infringing our intellectual property rights;

• it is possible that our pending and future patent applications that we own or may license will not lead to issued patents;

• any issued patent that we own or license in the future may be held invalid or unenforceable, including as a result of legal
challenges by our competitors or other third parties;

• others may have access to the same intellectual property rights licensed to us in the future on a non-exclusive basis;

• our competitors or other third parties might conduct research and development activities in countries where we or our
licensors do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets;

• we may not develop additional proprietary technologies that are patentable;

• we may fail to identify potential patentable subject matter and/or may fail to file on it;

• the patents or other intellectual property rights of others may harm our business; and

• we may choose not to file for patent protection to maintain certain trade secrets or know-how, and a third party may subsequently file a patent application covering such intellectual property or disclose information resulting in a loss of protection for such trade secret.

Should any of the foregoing occur, it could adversely affect our business, financial condition, results of operations and prospects.

***We may not be successful in obtaining or maintaining necessary rights to product candidates, components and processes for our development pipeline through acquisitions and in-licenses.***

The growth of our business may depend in part on our ability to acquire, in-license or use third-party intellectual property and proprietary rights. For example, any of our current or future product candidates may require specific formulations to work effectively and efficiently, we may develop product candidates containing our compounds and pre-existing pharmaceutical compounds, we may develop combination therapies with our compounds and third-party compounds, any of which could require us to obtain rights to use intellectual property held by third parties. In addition, with respect to any patent or other intellectual property rights we may co-own with third parties, we may require licenses to such co-owners' interest to such patents. We may be unable to acquire or in-license any compositions, methods of use, processes or other third-party intellectual property rights from third parties that we identify as necessary or important to our business operations. In addition, we may fail to obtain any of these licenses at a reasonable cost or on reasonable terms, if at all. Were that to happen, we may need to cease use of the compositions or methods covered by those third-party intellectual property rights and may need to seek to develop alternative approaches that do not infringe, misappropriate or otherwise violate those intellectual property rights, which may entail additional costs and development delays, even if we were able to develop such alternatives, which may not be feasible. Even if we can obtain a license, it may be non-exclusive, which means that our competitors may also receive access to the same technologies licensed to us. In that event, we may be required to expend significant time and resources to develop or license replacement technology.

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Additionally, we may collaborate with academic institutions to accelerate our research and development under written agreements with these institutions. In certain cases, these institutions provide us with an option to negotiate a license to any of the institution's rights in technology resulting from the collaboration. Even if we hold such an option, we may be unable to negotiate a license from the institution within the specified timeframe or under terms that are acceptable to us. If we are unable to do so, the institution may offer the intellectual property rights to others, potentially blocking our ability to pursue our program. Even if we can obtain a license, it may be non-exclusive, and our competitors may also receive access to the same technologies licensed to us.

The licensing and acquisition of third-party intellectual property rights is a competitive area, and companies that may be more established or have greater resources than we do may also be pursuing strategies to license or acquire third-party intellectual property rights that we may consider necessary or attractive to commercialize any of our current or future product candidates. More established companies may have a competitive advantage over us due to their size, cash resources or greater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. There can be no assurance that we will be able to successfully complete these types of negotiations and ultimately acquire the rights to the intellectual property surrounding any of our current or future product candidates that we may seek to develop or market. If we are unable to successfully obtain rights to required third-party intellectual property or to maintain the existing intellectual property rights we have, we may have to abandon development of certain programs and our business, financial condition, results of operations, and prospects could suffer.

**Risks related to this offering and ownership of our common stock** 

***There has been no prior public market for our common stock, and an active trading market may not develop or be sustained.***

There has been no public market for our common stock prior to this offering. The initial public offering price for our common stock was determined through negotiations among the underwriters and us and may vary from the market price of our common stock following this offering. An active or liquid market in our common stock may not develop upon closing of this offering or, if it does develop, it may not be sustainable. The lack of an active market may impair the value of your shares, your ability to sell your shares at the time you wish to sell them and the prices that you may obtain for your shares. An inactive market may also impair our ability to raise capital by selling our common stock and our ability to acquire other companies, products, or technologies by using our common stock as consideration.

***The price of our stock may be volatile, and you could lose all or part of your investment.***

The trading price of our common stock following this offering is likely to be highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control, including limited trading volume. In addition to the factors discussed in this section and elsewhere in this prospectus, these factors include:

• the commencement, enrollment, completion or results of our current or future preclinical and clinical trials for our
product candidates;

• any delay in identifying and advancing a clinical candidate for our other programs;

• any delay in our regulatory filings for our product candidates and any adverse development or perceived adverse development
with respect to the applicable regulatory authority's review of such filings, including without limitation the FDA's issuance of a "refusal to file" letter or a request for additional information;

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• adverse results or delays, suspensions or terminations in future preclinical studies or clinical trials;

• our decision to initiate a clinical trial, not to initiate a clinical trial or to terminate an existing clinical trial;

• adverse regulatory decisions, including failure to receive regulatory approval of our product candidates or the failure of
a regulatory authority to accept data from preclinical studies or clinical trials conducted in other countries;

• changes in laws or regulations applicable to our product candidates, including but not limited to clinical trial
requirements for approvals;

• adverse developments concerning our manufacturers;

• our inability to obtain adequate product supply for any approved product or inability to do so at acceptable prices;

• our inability to establish collaborations, if needed;

• our failure to commercialize our product candidates, if approved;

• additions or departures of key scientific or management personnel;

• unanticipated serious safety concerns related to any of our current or future product candidates;

• introduction of new products, product candidates or services offered by us or our competitors;

• announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our
competitors;

• our ability to effectively manage our growth;

• actual or anticipated variations in quarterly operating results;

• our cash position and cash burn rate;

• our failure to meet the estimates and projections of the investment community or that we may otherwise provide to the
public;

• publication of research reports about us or our industry, or product candidates in particular, or positive or negative
recommendations or withdrawal of research coverage by securities analysts;

• changes in the market valuations of similar companies;

• changes in the structure of the healthcare payment systems;

• overall performance of the equity markets;

• sales of our common stock by us or our stockholders in the future;

• trading volume of our common stock;

• changes in accounting practices;

• ineffectiveness of our internal controls;

• disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to
obtain patent protection for our technologies;

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• significant lawsuits, including patent or stockholder litigation;

• general political and economic conditions; and

• other events or factors, many of which are beyond our control.

In addition, the stock market in general, and the market for biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies. Broad market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance. If the market price of our common stock after this offering does not exceed the initial public offering price, you may not realize any return on your investment in us and may lose some or all of your investment. In the past, securities class action litigation has often been instituted against companies following periods of volatility in the market price of a company's securities. This type of litigation, if instituted, could result in substantial costs and a diversion of management's attention and resources.

***Our operating results may fluctuate significantly, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations.***

Our quarterly and annual operating results may fluctuate significantly, due to a variety of factors, many of which are outside of our control and may be difficult to predict, including:

• the timing and cost of, and level of investment in, research, development and, if approved, commercialization activities
relating to our current and future product candidates, which may change from time to time;

• the timing and status of enrollment for clinical trials;

• the cost of manufacturing our product candidates, as well as building out our supply chain, which may vary depending on the
quantity of production and the terms of our agreements with manufacturers;

• expenditures that we may incur to acquire, develop or commercialize additional product candidates and technologies;

• timing and amount of any milestone, royalty or other payments due under any collaboration, license or purchase agreement;

• future accounting pronouncements or changes in our accounting policies;

• the timing and success or failure of preclinical studies and clinical trials for our product candidates or competing
product candidates, or any other change in the competitive landscape of our industry, including consolidation among our competitors or partners;

• the timing of receipt of approvals for our product candidates from regulatory authorities in the United States and
internationally;

• exchange rate and interest rate fluctuations;

• coverage and reimbursement policies with respect to our product candidates, if approved, and potential future drugs that
compete with our products; and

• the level of demand for our product candidates, if approved, which may vary significantly over time.

The cumulative effects of these factors could result in large fluctuations and unpredictability in our quarterly and annual operating results. As a result, comparing our operating results on a period-to-period basis may not be meaningful. Investors should not rely on our past results as an indication of our future performance.

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This variability and unpredictability could also result in our failing to meet the expectations of industry or financial analysts or investors for any period. If our future revenue or operating results fall below the expectations of analysts or investors or below any forecasts we may provide to the market, or if any forecasts we provide to the market are below the expectations of analysts or investors, the price of our common stock could decline substantially. Such a stock price decline could occur even when we have met any previously publicly stated revenue or earnings guidance we may provide.

***If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.***

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. Securities and industry analysts do not currently, and may never, publish research on our company. If no securities or industry analysts commence coverage of our company, the trading price for our stock would likely be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who covers us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock price may decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.

***Our executive officers, directors, principal stockholders and their respective affiliates own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval.***

Based on the beneficial ownership of our common stock as of , prior to this offering, our executive officers, directors, holders of 5% or more of our capital stock and their respective affiliates beneficially owned approximately % of our voting stock and, upon the completion of this offering, that same group will hold approximately % of our outstanding voting stock (assuming no exercise of the underwriters' option to purchase additional shares and no purchases of shares in this offering), in each case assuming the conversion of all outstanding shares of our redeemable convertible preferred stock into shares of our common stock. As a result, these stockholders, if acting together, will continue to have significant influence over the outcome of corporate actions requiring stockholder approval, including the election of directors, amendment of our organizational documents, any merger, consolidation or sale of all or substantially all of our assets and any other significant corporate transaction. In addition, certain of our principal stockholders, including ARCH Venture Fund XIII, L.P. and Perceptive Capital Solutions Holding LP, have designated certain members of our board of directors. The interests of these stockholders may not be the same as or may even conflict with your interests. For example, these stockholders could delay or prevent a change of control of our company, even if such a change of control would benefit our other stockholders, which could deprive our stockholders of an opportunity to receive a premium for their common stock as part of a sale of our company or our assets and might affect the prevailing market price of our common stock. The significant concentration of stock ownership may adversely affect the trading price of our common stock due to investors' perception that conflicts of interest may exist or arise.

***Future sales of our common stock in the public market could cause our common stock price to fall.***

Our common stock price could decline as a result of sales of a large number of shares of common stock after this offering or the perception that these sales could occur. These sales, or the possibility that these sales may occur, might also make it more difficult for us to sell equity securities in the future at a time and price that we deem appropriate.

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Upon the completion of this offering, shares of common stock will be outstanding (or shares if the underwriters exercise their option to purchase additional shares from us in full), based on the number of shares outstanding as of .

All shares of common stock expected to be sold in this offering will be freely tradable without restriction or further registration under the Securities Act of 1933, as amended (the "Securities Act"), unless held by our "affiliates" as defined in Rule 144 under the Securities Act. The resale of the remaining shares, or % of our outstanding shares of common stock following this offering, is currently prohibited or otherwise restricted, subject to certain limited exceptions, as a result of securities law provisions, market standoff agreements entered into by certain of our stockholders with us or lock-up agreements entered into by our directors, officers and substantially all of our stockholders with the underwriters in connection with this offering under which they have agreed or will agree, subject to specific exceptions described in the section of this prospectus titled "*Underwriting*," not to sell any of our stock for 180 days following the date of this prospectus. We refer to such period as the lock-up period. We and certain of the underwriters may release certain stockholders from the market standoff agreements or lock-up agreements prior to the end of the lock-up period. Subject to applicable securities law restrictions, these shares will be able to be sold in the public market beginning on the 181st day after the date of this prospectus. Shares issued upon the exercise of stock options outstanding under our equity incentive plans or pursuant to future awards granted under those plans will become available for sale in the public market to the extent permitted by the provisions of applicable vesting schedules, market stand-off agreements and/or lock-up agreements, as well as Rules 144 and 701 under the Securities Act. For more information, see the section titled "*Shares Eligible for Future Sale*" included elsewhere in this prospectus.

Upon the completion of this offering, the holders of approximately shares, or % of our outstanding shares following this offering, of our common stock will have rights, subject to some conditions, to require us to file registration statements covering the sale of their shares or to include their shares in registration statements that we may file for ourselves or our other stockholders. We also intend to register the offer and sale of all shares of common stock that we may issue under our equity compensation plans. Once we register the offer and sale of shares for the holders of registration rights and shares that may be issued under our equity incentive plans, these shares will be able to be sold in the public market, subject to issuance and vesting schedules in the case of our equity incentive plans, and the lock-up agreements described under the section titled "*Underwriting*" included elsewhere in this prospectus.

In addition, in the future, we may issue additional shares of common stock, or other equity or debt securities convertible into common stock, in connection with a financing, acquisition, employee arrangement, or otherwise. Any such issuance could result in substantial dilution to our existing stockholders and could cause the price of our common stock to decline.

***We will have broad discretion in how we use the proceeds of this offering and may not use these proceeds effectively, which could affect our results of operations and cause our stock price to decline.***

We will have considerable discretion in the application of the net proceeds of this offering, including for any of the purposes described in the section titled "*Use of Proceeds*," and you will not have the opportunity as part of your investment decision to assess whether the net proceeds are being used appropriately. As a result, investors will be relying upon management's judgment with only limited information about our specific intentions for the use of the net proceeds of this offering. We may use the net proceeds for purposes that do not yield a significant return or any return at all for our stockholders. In addition, pending their use, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

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***If you purchase shares of our common stock in our initial public offering, you will experience substantial and immediate dilution.***

The assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, is substantially higher than the pro forma as adjusted net tangible book value per share of our outstanding common stock immediately following the completion of this offering. If you purchase shares of common stock in this offering, you will experience substantial and immediate dilution in the pro forma as adjusted net tangible book value per share of $ per share as of . That is because the price that you pay will be substantially greater than the pro forma as adjusted net tangible book value per share of the common stock that you acquire. This dilution is due in large part to the fact that our earlier investors paid substantially less than the initial public offering price when they purchased their shares of our capital stock. You will experience additional dilution if the underwriters exercise their option to purchase additional shares in this offering, when those holding stock options exercise their right to purchase common stock under our equity incentive plans, upon the grant of restricted stock awards or when we otherwise issue additional shares of common stock. For additional details see the section titled "*Dilution*" included elsewhere in this prospectus.

***Participation in this offering by our existing stockholders and/or their affiliated entities will reduce the public float for our common stock.***

To the extent our existing stockholders who are our affiliates or their affiliated entities participate in this offering, such purchases would reduce the non-affiliate public float of our common stock after this offering, which is the number of shares of common stock that are not held by our officers, directors and affiliated stockholders. As a result, the number of freely tradeable shares of our common stock following this offering will be reduced relative to what it would have been had these shares been sold to investors that were not existing stockholders, affiliates or purchasers. This could adversely impact the liquidity of our common stock and depress the price at which you may be able to sell shares of common stock purchased in this offering.

***Our issuance of additional capital stock in connection with financings, acquisitions, investments, our stock incentive plans or otherwise will dilute all other stockholders.***

We expect to issue additional capital stock in the future that will result in dilution to all other stockholders. We expect to grant equity awards to employees, directors and consultants under our stock incentive plans. We may also raise capital through equity financings in the future. As part of our business strategy, we may acquire or make investments in complementary companies, products or technologies and issue equity securities to pay for any such acquisition or investment. Any such issuances of additional capital stock may cause stockholders to experience significant dilution of their ownership interests and the per share value of our common stock to decline.

***We do not currently intend to pay dividends on our common stock and, consequently, our stockholders' ability to achieve a return on their investment will depend on appreciation of the value of our common stock.***

We have never declared or paid cash dividends on our common stock. We currently intend to retain all available funds and any future earnings to support operations and to finance the growth and development of our business. We do not intend to declare or pay any cash dividends on our capital stock in the foreseeable future. As a result, any investment return on our common stock will depend upon increases in the value for our common stock, which is not certain.

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***Provisions in our corporate charter documents and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current directors and members of management.***

Our third amended and restated certificate of incorporation, which will become effective immediately upon completion of this offering, and amended and restated bylaws, which will become effective upon the effectiveness of the registration statement of which this prospectus forms a part, will contain provisions that may discourage, delay or prevent a merger, acquisition or other change in control of our company that stockholders may consider favorable, including transactions in which our stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock, thereby depressing the market price of our common stock. In addition, because our board of directors is responsible for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors. Among other things, these provisions:

• establish a classified board of directors such that only one of three classes of directors is elected each year;

• allow the authorized number of our directors to be changed only by resolution of our board of directors;

• limit the manner in which stockholders can remove directors from our board of directors;

• establish advance notice requirements for stockholder proposals that can be acted on at stockholder meetings and
nominations to our board of directors;

• require that stockholder actions must be effected at a duly called stockholder meeting and prohibit actions by our
stockholders by written consent;

• limit who may call stockholder meetings;

• authorize our board of directors to issue preferred stock without stockholder approval, which could be used to institute a
"poison pill" that would work to dilute the stock ownership of a potential hostile acquirer, effectively preventing acquisitions that have not been approved by our board of directors; and

• require the approval of not less than two-thirds of the votes that all our
stockholders would be entitled to cast to amend or repeal specified provisions of our third amended and restated certificate of incorporation or amended and restated bylaws.

Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law (the "DGCL"), which prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.

***Our amended and restated bylaws that will become effective upon the effectiveness of this registration statement designate certain courts as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees.***

Our amended and restated bylaws that will become effective upon effectiveness of the registration statement of which this prospectus forms a part provide that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any state law claims for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of, or a claim

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based on, fiduciary duty owed by any of our current or former directors, officers, and employees to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our third amended and restated certificate of incorporation or our amended and restated bylaws (including the interpretation, validity or enforceability thereof) or (iv) any action asserting a claim that is governed by the internal affairs doctrine (the "Delaware Forum Provision"). The Delaware Forum Provision will not apply to any causes of action arising under the Securities Act or the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Our amended and restated bylaws further provide that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the U.S. shall be the sole and exclusive forum for resolving any complaint asserting a cause or causes of action arising under the Securities Act (the "Federal Forum Provision"). In addition, our amended and restated bylaws provide that any person or entity purchasing or otherwise acquiring any interest in shares of our common stock is deemed to have notice of and consented to the foregoing provisions; provided, however, that stockholders cannot and will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.

***We may not be able to maintain a listing of our common stock on .***

We must meet certain financial and liquidity criteria to maintain the listing of our common stock on . If we violate 's listing requirements, our common stock may be delisted. If we fail to meet any of 's listing standards, our common stock may be delisted. A delisting of our common stock from may materially impair our stockholders' ability to buy and sell our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock. The delisting of our common stock could significantly impair our ability to raise capital and the value of your investment.

**Other general risks** 

***Unfavorable global economic and geopolitical conditions could adversely affect our business, financial condition, stock price, and results of operations.***

Our business could be adversely affected by unstable economic and political conditions within the United States and foreign jurisdictions, including as a result of an economic downturn and geopolitical events, such as

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changes in U.S. federal policy that affect the geopolitical landscape. Changes to U.S. policy implemented by the U.S. Congress or U.S. presidential administrations have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. Since the start of the most recent U.S. presidential administration in 2025, U.S. policy changes have been implemented at a rapid pace and additional changes are likely. For example, the implementation of tariffs by the U.S. government has led to increased trade and political tensions, between not only the U.S. and China, but also between the U.S. and other countries in the international community. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions, including U.S. trade policies, could have a material adverse effect on our financial condition or results of operations. Until we know what policy changes are made, whether those policy changes are challenged and subsequently upheld by the court system and how those changes impact our business and the business of our competitors over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.

The global credit and financial markets have also generally experienced extreme volatility and disruptions (including as a result of actual or perceived changes in interest rates, inflation and macroeconomic uncertainties), which has included severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, high inflation, fluctuating interest rates, uncertainty about economic stability, global supply chain disruptions, and increases in unemployment rates. The financial markets and the global economy may also be adversely affected by the current or anticipated impact of military conflict, including the ongoing conflicts between Russia and Ukraine, and in the Middle East, terrorism, political unrest or other geopolitical events. Sanctions imposed by the U.S. and other countries in response to such conflicts, including the one in Ukraine, may also continue to adversely impact the financial markets and the global economy, and any economic countermeasures by the affected countries or others could exacerbate market and economic instability. There can be no assurance that further deterioration in credit and financial markets and confidence in economic conditions will not occur. A severe or prolonged economic downturn could result in a variety of risks to our business, including a decrease in the demand for our drug candidates and in our ability to raise additional capital when needed on acceptable terms, if at all.

There are also current geopolitical tensions with China that may affect our operations. For example, the recently enacted BIOSECURE Act, which, among other things, prohibits U.S. federal funding in connection with biotechnology equipment or services produced or provided by certain named Chinese "biotechnology companies of concern" and loans and grants to, and federal contracts with any entity that uses biotechnology equipment or services from one of these entities. Any additional executive action, legislative action similar to the BIOSECURE Act or potential sanctions with China could materially impact manufacturing partners and our agreements with them. We continue to assess any legislation as it develops to determine the effect, if any, on our contractual relationships. Furthermore, any disruptions to our supply chain as a result of unfavorable global economic conditions, including due to geopolitical conflicts, political unrest or public health crises, could negatively impact the timely execution of our ongoing and future clinical trials.

In addition, current inflationary trends in the global economy may impact salaries and wages, costs of goods and transportation expenses, among other things, and recent events of political unrest and/or potential future disruptions in access to bank deposits or lending commitments due to bank failures may create market and economic instability. We cannot anticipate all of the ways in which the foregoing, and the current economic climate and financial market conditions generally, could adversely impact our business.

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***We, or the third parties upon whom we depend, may be adversely affected by natural disasters, public health crises or other business interruptions and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster.***

Natural disasters or public health crises could severely disrupt our operations, and have a material adverse impact on our business, results of operations, financial condition, and prospects. If a natural disaster, power outage, public health crisis or other event occurred that prevented us from conducting our clinical trials, releasing clinical trial results or delaying our ability to obtain regulatory approval for our product candidates, it may be difficult or, in certain cases, impossible for us to continue our business for a substantial period of time.

***We are eligible to be treated as an "emerging growth company" and a "smaller reporting company" and our election of reduced reporting requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors.***

We are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act ("JOBS Act"). We could be an emerging growth company for up to five years following the completion of this offering, although circumstances could cause us to lose that status earlier, including if we are deemed to be a "large accelerated filer," which occurs when the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, or if we have total annual gross revenue of $1.235 billion or more during any fiscal year before that time, in which cases we would no longer be an emerging growth company as of the following December 31, or if we issue more than $1.0 billion in non-convertible debt during any three-year period before that time, in which case we would no longer be an emerging growth company immediately. For so long as we remain an emerging growth company, we are permitted and intend to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include:

• not being required to comply with the auditor attestation requirements in the assessment of our internal control over
financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act");

• providing only two years of audited financial statements in addition to any required unaudited interim financial statements
and a correspondingly reduced "Management's Discussion and Analysis of Financial Condition and Results of Operations" disclosure in this prospectus;

• reduced disclosure obligations regarding executive compensation; and

• exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval
of any golden parachute payments not previously approved. In this prospectus, we have not included all of the executive compensation-related information that would be required if we were not an emerging growth company.

In addition, the JOBS Act provides that an emerging growth company can also take advantage of an extended transition period for complying with new or revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves of this exemption from new or revised accounting standards, and therefore we will not be subject to the same requirements to adopt new or revised accounting standards as other public companies that are not emerging growth companies.

We are also a "smaller reporting company" as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our common stock held by non-affiliates is less than $250.0 million

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measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and our common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our share price may be more volatile.

***We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives and corporate governance practices.***

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. We will be subject to the reporting requirements of the Exchange Act, which will require, among other things, that we file with the SEC annual, quarterly and current reports with respect to our business and financial condition. In addition, the Sarbanes-Oxley Act, as well as rules subsequently adopted by the SEC and to implement provisions of the Sarbanes-Oxley Act, impose significant requirements on public companies, including requiring establishment and maintenance of effective disclosure and financial reporting controls and changes in corporate governance practices. There are significant corporate governance and executive compensation related provisions in the Dodd-Frank Wall Street Reform and Consumer Protection Act that require the SEC to adopt additional rules and regulations in these areas such as "say on pay" and proxy access. Recent legislation permits emerging growth companies to implement many of these requirements over a longer period. Stockholder activism, the current political environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which may lead to additional compliance costs and impact the manner in which we operate our business in ways we cannot currently anticipate.

We expect becoming a public company will substantially increase our legal and financial compliance costs and make some activities more time-consuming and costly. If these requirements divert the attention of our management and personnel from other business concerns, they could have an adverse effect on our business. The increased costs will decrease our net income or increase our net loss, and may require us to reduce costs in other areas of our business or increase the prices of our products or services. For example, we expect it to be more difficult and more expensive for us to obtain director and officer liability insurance as a public company, and we may be required to incur substantial costs to maintain the same or similar coverage. We cannot predict or estimate the amount or timing of additional costs we may incur as a public company. The impact of these requirements could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers.

***If we fail to establish and maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud. As a result, stockholders could lose confidence in our financial and other public reporting, which would harm our business and the trading price of our common stock.***

Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that needs to be reevaluated frequently. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles. In connection with this offering, we began the process of documenting, reviewing and improving our internal controls and procedures for compliance with Section 404 of the Sarbanes-Oxley Act, which will require annual management assessment of the effectiveness of our internal control over financial reporting. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations. In

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addition, any testing by us conducted in connection with Section 404, or any subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement. Inferior internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our stock.

For as long as we are an emerging growth company or a non-accelerated filer, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act. An independent assessment of the effectiveness of our internal controls over financial reporting could detect problems that our management's assessment might not. Undetected material weaknesses in our internal controls over financial reporting could severely inhibit our ability to accurately report our financial condition and results of operations and could lead to restatements of our financial statements and require us to incur the expense of remediation.

***Our disclosure controls and procedures may not prevent or detect all errors or acts of fraud.***

Upon the completion of this offering, we will become subject to the periodic reporting requirements of the Exchange Act. We must design our disclosure controls and procedures to reasonably assure that information we must disclose in reports we file or submit under the Exchange Act is accumulated and communicated to management, and recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC. We believe that any disclosure controls and procedures, no matter how well-conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. For example, our directors or executive officers could inadvertently fail to disclose a new relationship or arrangement causing us to fail to make a required related party transaction disclosure. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected.

***Our ability to use our net operating loss carryforwards and other tax attributes may be limited.***

As of December 31, 2025, we had approximately $56.5 million of federal net operating losses ("NOLs"). Federal NOLs generated in taxable years beginning after December 31, 2017, may be carried forward indefinitely, but the deductibility of such federal NOL carryforwards in a taxable year is limited to 80% of our taxable income in such year. As of December 31, 2025, we had approximately $2.1 million of state NOLs. Of the state NOLs, some are of indefinite life, but most expire at various dates, beginning in 2040. As of December 31, 2025, we had approximately $7.6 million of federal research and development tax credit carryforwards. Federal tax credit carryforwards expire at various dates, beginning in 2045. As of December 31, 2025, we had approximately $1.0 million of state research and development tax credit carryforwards, which carry forward indefinitely.

Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the "Code"), if a corporation undergoes an "ownership change," generally defined as a greater than 50 percentage point change (by value) in its equity ownership by "5 percent shareholders" over a three-year period, the corporation's ability to use its pre-change NOLs and certain other pre-change tax attributes (including research and development tax credits) to offset its post-change income or taxes may be limited. A corporation that experiences an ownership change will generally be subject to an annual limitation on the use of its pre-ownership change NOLs equal to the value of the corporation immediately before the ownership change, multiplied by the long-term tax-exempt rate (subject to certain adjustments). We may have experienced ownership changes in the past and may experience

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ownership changes as a result of this offering and/or subsequent shifts in our stock ownership (some of which are outside our control). There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs by federal or state taxing authorities or other unforeseen reasons, portions of our existing NOLs could expire or otherwise be unavailable to reduce future income tax liabilities. As a result, our ability to use our pre-change NOLs and tax credits to offset future taxable income, if any, or taxes could be subject to limitations. Similar provisions of state tax law may also apply. As a result, even if we attain profitability, we may be unable to use a material portion of our NOLs and tax credits.

***Changes in tax law could adversely affect our business and financial condition.***

U.S. federal, state, local and foreign tax laws, regulations and administrative guidance are subject to change as a result of the legislative process and review and interpretation by the U.S. Internal Revenue Service, the U.S. Treasury Department and other taxing authorities. Changes to tax laws (which changes may have retroactive application), including with respect to net operating losses and research and development tax credits, could adversely affect us or holders of our common stock. In recent years, many such changes have been made and changes are likely to continue to occur in the future. Future changes in tax laws could have a material adverse effect on our business, cash flow, financial condition or results of operations. We urge investors to consult with their legal and tax advisers regarding the implications of potential changes in tax laws on an investment in our common stock.

***Clinical trial and product liability lawsuits against us could divert our resources and could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop.***

We face an inherent risk of clinical trial and product liability exposure related to the testing of our product candidates in clinical trials, and we will face an even greater risk if we commercially sell any products that we develop. While we currently have no products that have been approved for commercial sale, the ongoing, planned and future use of product candidates by us in clinical trials, and the sale of any approved products in the future, may expose us to liability claims. These claims might be made by patients that use the product, healthcare providers, pharmaceutical companies or others selling such products. If we cannot successfully defend ourselves against claims that our product candidates or products caused injuries, we will incur substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in:

• decreased demand for any product candidates or products that we may develop;

• termination of clinical trials;

• injury to our reputation and significant negative media attention;

• withdrawal of clinical trial participants;

• significant costs to defend any related litigation;

• substantial monetary awards to trial participants or patients;

• loss of revenue;

• reduced resources of our management to pursue our business strategy; and

• the inability to commercialize any products that we may develop.

Although we currently hold clinical trial liability insurance, we will need to maintain such insurance coverage as we expand our clinical trials or if we commence commercialization of our product candidates. Insurance coverage is increasingly expensive. We may not be able to obtain and maintain insurance coverage at a reasonable cost or in an amount adequate to satisfy any liability that may arise. If a successful clinical trial or product liability claim or series of claims is brought against us for uninsured liabilities or in excess of insured liabilities, our assets may not be sufficient to cover such claims and our business operations could be impaired.

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***We may become involved in litigation that could divert management's attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages.***

From time to time we may be subject to litigation claims through the ordinary course of our business operations regarding, but not limited to, securities litigation, employment matters, security of patient and employee personal data, contractual relations with collaborators and licensors and intellectual property rights. In the past, securities class action litigation has often followed certain significant business transactions, such as the sale of a company or announcement of any other strategic transaction, the announcement of negative events, such as negative results from clinical trials, or periods of volatility in the market price of a company's securities. These events may also result in or be concurrent with investigations by the SEC. We may be exposed to such litigation or investigation even if no wrongdoing occurred. Litigation and investigations are usually expensive and divert management's attention and resources, which could adversely affect our business and cash resources and our ability to consummate a potential strategic transaction or the ultimate value our stockholders receive in any such transaction.

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**Special note regarding forward-looking statements** 

This prospectus, including the sections entitled "*Prospectus Summary*," "*Risk Factors*," "*Management's Discussion and Analysis of Financial Condition and Results of Operations*," and "*Business*," contains express or implied forward-looking statements that are based on our management's belief and assumptions and on information currently available to our management. All statements other than statements of historical facts contained in this prospectus, including statements regarding our future results of operations and financial position, business strategy, product candidates, planned preclinical studies and clinical trials, results of preclinical studies, clinical trials, research and development costs, regulatory approvals, commercial strategy, timing and likelihood of success, as well as plans and objectives of management for future operations, are forward-looking statements. These statements involve known and unknown risks, uncertainties, and other important factors that are in some cases beyond our control and may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

In some cases, you can identify forward-looking statements by terms such as "may," "will," "should," "would," "expect," "plan," "anticipate," "could," "intend," "target," "project," "believe," "estimate," "predict," "potential," or "continue" or the negative of these terms or other similar expressions. Forward-looking statements contained in this prospectus include, but are not limited to, statements about:

• the initiation, timing, progress and results of our research and development programs, preclinical studies and clinical
trials;

• the ability of clinical trials to demonstrate safety and efficacy of our product candidates, and other positive results,
and the ability of our preclinical studies to predict later clinical trial results;

• the timing, scope and likelihood of regulatory filings and approvals of our product candidates;

• our ability to deploy and develop our Prolaio platform;

• the implementation of our business model, and strategic plans for our business, programs, and current and future product
candidates;

• our ability to obtain additional cash and the sufficiency of our existing cash, cash equivalents and short-term investments
to fund our future operating expenses and capital expenditure requirements;

• the accuracy of our estimates regarding expenses, future revenue, capital requirements and needs for additional financing;

• the size and growth potential of the markets for our product candidates, and our ability to serve those markets;

• our potential and ability to successfully manufacture and supply our current and future product candidates for clinical
trials and for commercial use, if approved;

• the scope of protection we are able to establish and maintain for intellectual property rights covering our product
candidates;

• developments relating to our competitors and our industry, including competing product candidates and therapies;

• existing regulations and regulatory developments in the U.S. and other jurisdictions;

• expectations regarding future events under collaboration and licensing agreements, including potential future payments, as
well as our plans and strategies for entering into further collaboration and licensing agreements;

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• general economic, industry and market conditions, including fluctuating interest rates and rising inflation;

• our ability to attract and retain the continued service of our key personnel and to identify, hire and then retain
additional qualified personnel;

• our expectations regarding the period during which we will qualify as an emerging growth company under the JOBS Act; and

• our anticipated cash runway and use of our existing cash, cash equivalents and short-term investments and the proceeds from
this offering.

We have based these forward-looking statements largely on our current expectations and projections about our business, the industry in which we operate and financial trends that we believe may affect our business, financial condition, results of operations and prospects, and these forward-looking statements are not guarantees of future performance or development. These forward-looking statements speak only as of the date of this prospectus and are subject to a number of risks, uncertainties and assumptions described in "*Risk Factors*" and elsewhere in this prospectus. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. No forward-looking statement is a guarantee of future performance. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein until after we distribute this prospectus, whether as a result of any new information, future events or otherwise. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, collaborations, joint ventures, or investments that we may make or enter into.

In addition, statements that "we believe" and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and you are cautioned not to unduly rely upon these statements.

You should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect.

This prospectus also contains estimates, projections and other information concerning our industry, our business and the markets for our product candidates. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. Unless otherwise expressly stated, we obtained this industry, business, market, and other data from our own internal estimates and research as well as from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry, medical and general publications, government data and similar sources. While we are not aware of any misstatements regarding any third-party information presented in this prospectus, their estimates, in particular, as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties and are subject to change based on various factors, including those discussed under the section entitled "*Risk Factors*" and elsewhere in this prospectus.

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**Use of proceeds** 

We estimate that the net proceeds from this offering will be approximately $ million (or approximately $ million if the underwriters exercise their option to purchase additional shares of our common stock in full) based on an assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

Each $1.00 increase or decrease in the assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover of this prospectus, would increase or decrease, as applicable, the net proceeds to us from this offering by $ million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase or decrease of 1.0 million shares in the number of shares of common stock offered by us, as set forth on the cover page of this prospectus, would increase or decrease, as applicable, the net proceeds to us from this offering by $ million, assuming the assumed initial public offering price of $ per share remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

The principal purposes of this offering are to create a public market for our common stock and thereby facilitate future access to the public equity markets, increase our visibility in the marketplace, and obtain additional capital to support our operations. We currently intend to use the net proceeds from this offering, together with our existing cash, cash equivalents and short-term investments, as follows:

• approximately $ million to $ million to fund the clinical
development of Danicamtiv in genetic DCM through      ;

• approximately $ million to $ million to fund the clinical
development of Ataciguat in moderate CAVS through      ;

• approximately $ million to $ million to fund the clinical
development of Tonlamarsen in ASH through      ;

• approximately $ million to $ million to fund other research and
development activities; and

• the remainder for working capital and other general corporate purposes.

We may also use a portion of the remaining net proceeds and our existing cash, cash equivalents and short-term investments to in-license, acquire, or invest in complementary businesses, technologies, products, or assets. However, we have no current commitments, agreements, understandings or obligations to do so.

We believe, based on our current operating plan, that the net proceeds from this offering, together with our existing cash, cash equivalents and short-term investments, will be sufficient to fund our operations through . We have based this estimate on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect. We do not have any committed external source of funds.

Our expected use of proceeds from this offering described above represents our current intentions based on our present plans and business condition. As of the date of this prospectus, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the completion of this offering or the actual amounts that we will spend on the uses set forth above. We expect that we will require additional funds in order to fully accomplish the specified uses of the proceeds of this offering. The amounts and timing of our actual

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expenditures will depend on numerous factors, including progress of our research and development, the status of and results from preclinical studies and clinical trials that we are conducting or may conduct in the future, and other factors described in the section titled "*Risk Factors*" in this prospectus, as well as the amount of cash used in our operations and any unforeseen cash needs. Therefore, our actual expenditures may differ materially from the estimates described above. We may find it necessary or advisable to use the net proceeds for other purposes.

We will have broad discretion over how to use the net proceeds to us from this offering and investors will be relying on the judgment of our management regarding the application of the net proceeds. Pending our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation instruments, including short-term and long-term interest-bearing instruments, investment-grade securities, and direct or guaranteed obligations of the U.S. government. We cannot predict whether the proceeds invested will yield a favorable return.

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**Dividend policy** 

We have never declared or paid cash dividends on our capital stock. We do not anticipate declaring or paying, in the foreseeable future, any cash dividends on our capital stock. We intend to retain all available funds and future earnings, if any, to fund the development and expansion of our business. Any future determination regarding the declaration and payment of dividends, if any, will be at the discretion of our board of directors, subject to applicable laws, and will depend on then-existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects, and other factors our board of directors may deem relevant. In addition, our ability to pay cash dividends on our capital stock in the future may be limited by the terms of any future debt or preferred securities we issue or any credit facilities we enter into.

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**Capitalization** 

The following table sets forth our existing cash, cash equivalents and short-term investments, excluding restricted cash, and our total capitalization as of December 31, 2025:

• on an actual basis;

• on a pro forma basis, giving effect to (i) the automatic conversion of all outstanding shares of redeemable
convertible preferred stock into an aggregate of 29,987,476 shares (which includes 468,053 shares issued in March 2026) of our common stock upon the completion of this offering and (ii) the filing and effectiveness of our third amended and
restated certificate of incorporation, which will occur upon the completion of this offering; and

• on a pro forma as adjusted basis, giving effect to (i) the pro forma adjustments set forth above and (ii) the
issuance and sale of    shares of common stock in this offering at the assumed initial public offering price of $ per share, the midpoint of the price range set forth on the cover page of this
prospectus, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

The pro forma as adjusted information below is illustrative only, and our capitalization following the completion of this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing.

You should read this information together with our consolidated financial statements and the related notes included elsewhere in this prospectus, and the sections titled "*Management's Discussion and Analysis of Financial Condition and Results of Operations.*"

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| | | | |
|:---|:---|:---|:---|
| | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** |
| <br>**(in thousands, except share and per share data)** | **Actual** | **Pro<br>forma** | **Pro forma<br>as adjusted(1)** |
|  Cash, cash equivalents and short-term investments | $335485 |  |  |
|  Redeemable convertible preferred stock, $0.00001 par value; 29,519,423 shares authorized and 29,519,423 shares issued and outstanding, actual; no shares authorized, issued or outstanding, pro forma and pro forma as adjusted | $586150 |  |  |
|  Stockholders' equity (deficit): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Preferred stock, $0.00001 par value; no shares authorized, issued or outstanding, actual; shares authorized, and no shares issued or outstanding, pro forma and pro forma as adjusted |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Common stock, $0.00001 par value; 53,365,000 shares authorized and 10,265,637 shares issued and outstanding, actual; shares authorized, issued and outstanding, pro forma; shares authorized, shares issued and outstanding, pro forma as adjusted |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Additional paid-in capital | 30691 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income | 63 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated deficit | (281089) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total stockholders' (deficit) equity | (250335) |  |  |
|  Total capitalization | $335815 |  |  |

---

(1) Each $1.00 increase or decrease, as applicable, in the assumed initial public offering price of
$ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the pro forma as adjusted amount of each

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of cash, cash equivalents and short-term investments, additional paid-in capital, total stockholders' (deficit) equity and total capitalization by $ million, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase or decrease, as applicable, of 1.0 million shares in the number of shares of common stock offered by us would increase or decrease, as applicable the pro forma as adjusted amount of each of cash, cash equivalents and short-term investments, additional paid-in capital, total stockholders' (deficit) equity and total capitalization by $ million, assuming no change in the assumed initial public offering price per share, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. <br>

The number of shares of our common stock that will be outstanding after this offering on a pro forma and pro forma as adjusted basis is based on 40,253,113 shares of common stock (which includes 625,000 shares of unvested restricted common stock and 736,481 shares of common stock issued upon early exercise of stock options that remain subject to repurchase) outstanding as of December 31, 2025, after giving effect to the automatic conversion of all outstanding shares of our redeemable convertible preferred stock into the aggregate of 29,987,476 shares of common stock upon the completion of this offering, and excludes:

• 8,177,647 shares of common stock issuable upon exercise of outstanding stock options as of December 31, 2025 under our
2023 Plan, with a weighted average exercise price of $4.36 per share;

• 2,059,429 shares of common stock issuable upon exercise of outstanding stock options granted after December 31, 2025,
through March 18, 2026 pursuant to our 2023 Plan, with a weighted average exercise price of $9.23 per share;

• 2,747,295 shares of common stock reserved for future issuance as of December 31, 2025 under the 2023 Plan, which will
cease to be available for issuance at the time that our 2026 Plan becomes effective;

• 1,100,000 shares of common stock issuable upon the exercise of warrants outstanding as of December 31, 2025, with an
exercise price of $21.37 per share;

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of our common stock reserved for future issuance under our 2026 Plan, which will become
effective on the date immediately prior to the effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common stock reserved for future issuance under the 2026
Plan and any shares underlying outstanding stock awards granted under the 2023 Plan that expire or are repurchased, forfeited, cancelled, or withheld; and

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of common stock reserved for future issuance under the ESPP, which will become effective
on the date immediately prior to the date of effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common stock reserved for future issuance under the ESPP.

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**Dilution** 

If you invest in our common stock in this offering, your ownership interest will be diluted immediately to the extent of the difference between the initial public offering price per share of our common stock and the pro forma as adjusted net tangible book value per share of our common stock immediately after this offering.

Our historical net tangible book value (deficit) as of December 31, 2025 was ($273.6) million, or ($26.65) per share of our common stock. Our historical net tangible book value (deficit) represents the amount of our total tangible assets less our total liabilities and the carrying value of our redeemable convertible preferred stock, which is not included within stockholders' deficit. Historical net tangible book value (deficit) per share represents historical net tangible book value (deficit) divided by 10,265,637 shares of our common stock outstanding (which includes 625,000 shares of unvested restricted common stock and 736,481 shares of unvested common stock issued upon early exercise of stock options that remain subject to repurchase) as of December 31, 2025.

Our pro forma net tangible book value as of December 31, 2025 was $ million, or $ per share. Pro forma net tangible book value per share represents the amount of our total tangible assets less our total liabilities, divided by the number of shares of our common stock outstanding (which includes 625,000 shares of unvested restricted common stock and 736,481 shares of common stock issued upon early exercise of stock options that remain subject to repurchase) as of December 31, 2025, after giving effect to the automatic conversion of all outstanding shares of redeemable convertible preferred stock into 29,987,476 shares of common stock upon the completion of this offering.

After giving further effect to the sale of shares of common stock in this offering at the assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of December 31, 2025 would have been $ million, or $ per share. This amount represents an immediate increase in pro forma net tangible book value of $ per share to our existing stockholders and an immediate dilution in pro forma net tangible book value of $ per share to new investors purchasing shares of common stock in this offering.

Dilution per share to new investors is determined by subtracting pro forma as adjusted net tangible book value per share after this offering from the initial public offering price per share paid by new investors. The following table illustrates this dilution (without giving effect to any exercise by the underwriters of their option to purchase additional shares):

---

| | | |
|:---|:---|:---|
|  Assumed initial public offering price per share |  | $|
| &nbsp;&nbsp;&nbsp;&nbsp; Historical net tangible book value (deficit) per share as of December 31, 2025 | $(26.65) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Increase per share as of December 31, 2025 attributable to the pro forma adjustment described above |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Pro forma net tangible book value per share as of December 31, 2025 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Increase in pro forma as adjusted net tangible book value per share attributable to new investors participating in this offering |  |  |
|  Pro forma as adjusted net tangible book value per share after this offering |  |  |
|  Dilution per share to new investors participating in this offering |  | $|

---

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The dilution information discussed above is illustrative only and may change based on the actual initial public offering price and other terms of this offering. Each $1.00 increase or decrease, as applicable, in the assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the pro forma as adjusted net tangible book value per share after this offering by $, and dilution per share to new investors purchasing common stock in this offering by $, assuming that the number of shares of common stock offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase or decrease, as applicable, of 1.0 million shares in the number of shares of common stock offered by us would increase or decrease, as applicable, our pro forma as adjusted net tangible book value per share after this offering by $ per share, in each case, and increase or decrease, as applicable, the dilution to investors participating in this offering by $ per share, assuming no change in the assumed initial public offering price, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

If the underwriters exercise their option to purchase additional shares of our common stock in full, our pro forma as adjusted net tangible book value after the offering would be $ per share, representing an immediate increase in pro forma as adjusted net tangible book value of $ per share to existing stockholders and immediate dilution in pro forma as adjusted net tangible book value dilution of $ per share to new investors, in each case assuming an initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

The following table summarizes on the pro forma as adjusted basis described above, as of December 31, 2025, the total number of shares of common stock purchased from us on an as converted basis, the total consideration paid or to be paid to us, and the average price per share paid by existing stockholders or to be paid by new investors in this offering, based on the assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, before deducting underwriting discounts and commissions and estimated offering expenses payable by us. New investors purchasing shares of our common stock in this offering will pay an average price per share substantially higher than our existing stockholders paid.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Shares purchased** | **Shares purchased** | **Total consideration** | **Total consideration** | **Weighted-<br>average<br>price per<br>share** |
| | **Number** | **Percentage** | **Percentage** | **Percentage** | **Weighted-<br>average<br>price per<br>share** |
|  Existing stockholders |  | % | $— | % | $|
|  New investors purchasing shares in this offering |  |  |  |  |  |
|  Total |  | 100.0% | $— | 100.0% | $|

---

The table above assumes no exercise of the underwriters' option to purchase additional shares in this offering. If the underwriters exercise their option to purchase additional shares of common stock from us in full, our existing stockholders would own %, and new investors purchasing shares of our common stock in this offering would own %, of the total number of shares of our common stock outstanding immediately after the completion of this offering.

The number of shares of our common stock that will be outstanding after this offering is based on 40,253,113 shares (which includes 625,000 shares of unvested restricted common stock and 736,481 shares of common stock issued upon early exercise of stock options that remain subject to repurchase) outstanding as of

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December 31, 2025, after giving effect to the automatic conversion of all outstanding shares of our redeemable convertible preferred stock into an aggregate of 29,987,476 shares of common stock upon the completion of this offering, and excludes:

• 8,177,647 shares of common stock issuable upon exercise of outstanding stock options as of December 31, 2025 under our
2023 Plan, with a weighted average exercise price of $4.36 per share;

• 2,059,429 shares of common stock issuable upon exercise of outstanding stock options granted after December 31, 2025,
through March 18, 2026 pursuant to our 2023 Plan, with a weighted average exercise price of $9.23 per share;

• 2,747,295 shares of common stock reserved for future issuance as of December 31, 2025 under the 2023 Plan, which will
cease to be available for issuance at the time that our 2026 Plan, becomes effective;

• 1,100,000 shares of common stock issuable upon the exercise of warrants outstanding as of December 31, 2025, with an
exercise price of $21.37 per share;

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of our common stock reserved for future issuance under our 2026 Plan, which will become
effective on the date upon immediately prior to effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common stock reserved for future issuance under the 2026
Plan and any shares underlying outstanding stock awards granted under the 2023 Plan that expire or are repurchased, forfeited, cancelled, or withheld; and

• &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; shares of common stock reserved for future issuance under our ESPP, which will become effective
on the date immediately prior to the date of effectiveness of the registration statement of which this prospectus forms a part, as well as any automatic increases in the number of shares of common stock reserved for future issuance under the ESPP.

To the extent any outstanding options are exercised, new options or other equity awards are issued under our equity incentive plans, or we issue additional shares of common stock in the future, there will be further dilution to new investors. In addition, we may choose to raise additional capital because of market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans. If we raise additional capital through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our stockholders.

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**Management's discussion and analysis of financial condition and results of operations** 

*You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our audited consolidated financial statements as of December 31, 2025 and 2024 and for the years ended December 31, 2025 and 2024, and related notes and other financial information included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectus contain forward-looking statements based upon our current plans and expectations that involve risks, uncertainties and assumptions, such as statements regarding our plans, strategies, objectives, expectations, intentions and beliefs. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under "Risk Factors" and elsewhere in this prospectus. You should carefully read the "Risk Factors" section of this prospectus to gain an understanding of the important factors that could cause actual results to differ materially from our forward-looking statements. Please also see "Special Note Regarding Forward-Looking Statements." Our historical results are not necessarily indicative of the results that may be expected for any period in the future.* 

**Overview** 

We are a clinical-stage precision therapeutics company developing medicines that target the root cause of specific cardiovascular diseases where no approved treatments exist. Our mission is to develop multiple targeted cardiovascular treatments in parallel that bring people with cardiovascular diseases closer to the cures they deserve. Our team is values-based and mission-driven, led by a proven and experienced management team applying a new philosophy to cardiovascular drug development. We have three late-stage programs, Danicamtiv, Ataciguat, and Tonlamarsen, in clinical development in first-in-indication opportunities intended to create new standards of care for high-need patients.

Our management team, including leaders from MyoKardia, Inc. ("MyoKardia"), has deep-domain knowledge of, and proven ability to, navigate the complexity of cardiovascular disease and translate that insight into an innovative drug development approach, delivering with exceptional speed and execution. We believe this uniquely enables us to apply a high degree of precision to cardiovascular drug development, targeting the root causes of disease, rather than later onset cardiovascular symptoms. We utilize an optimized clinical development framework, enhanced by proprietary data and analytics technology through our Prolaio platform, to drive efficient execution and accelerated proof-of-concept trial timelines. By applying our differentiated understanding of cardiovascular clinical endpoints, prioritizing indications with high regulatory clarity and significant unmet need, and focusing on biology-led patient selection for our trials, we believe we are uniquely positioned to maximize our probability of clinical success and efficiently develop and deliver multiple novel medicines with the greatest possible therapeutic impact for patients and healthcare providers alike.

Cardiovascular disease is the leading cause of death worldwide, yet innovation has lagged due to drug development focused on broad, downstream, symptom-focused approaches despite disease heterogeneity and genetic variability. Furthermore, clinical trial design has depended on infrequent in-office measurements, failing to capture between visit changes that are critical to understanding cardiovascular disease, including symptoms and variability over time. These factors often result in development requiring lengthy, large and expensive outcomes trials with modest treatment effects. Kardigan's approach is designed to address these challenges through differentiated clinical trial designs with near real-time continuous data collection that enable more modern and efficient development, including reduced enrollment size and trial duration relative to traditional cardiovascular outcomes trials. The result is faster and more cost-effective trials designed to achieve a higher probability of success.

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Our mission is to apply Kardigan's purpose-built cardiovascular development model to advance multiple late-stage programs in parallel, targeting "3 in 4"–three high-impact medicines through pivotal studies in roughly four years, subject to regulatory approval–enabling a credible, standalone and attractive value–creation path. By executing with discipline across portfolio selection, development strategy and trial execution, we aim to deliver better patient outcomes and build a durable, fully integrated, leading cardiovascular-focused ****biotechnology company. Our three late-stage programs include Danicamtiv, which we are developing for the treatment of genetic dilated cardiomyopathy ("DCM"), Ataciguat, which is aimed at slowing the progression of calcific aortic valve stenosis ("CAVS") in patients with moderate disease, and Tonlamarsen, which we are developing for the management of blood pressure ("BP") in acute severe hypertension ("ASH") post-hospitalization. Each of these medicines is designed specifically for well-defined patient populations with well-defined regulatory pathways. Danicamtiv was initially discovered by MyoKardia and further developed by Bristol-Myers Squibb Company ("BMS Co."). We also acquired rights to Ataciguat from Sanofi and the Mayo Foundation for Medical Education and Research ("Mayo") through the acquisition of Rancho Santa Fe Bio, Inc. ("RSF") and in-licensed Tonlamarsen from Ionis Pharmaceuticals, Inc. ("Ionis").

Since our inception, we have not generated any revenue from product sales or other sources and have incurred significant operating losses and negative cash flows from our operations. Our primary uses of cash to date have been conducting research and development, acquisitions, building infrastructure, developing intellectual property, hiring personnel and providing general and administrative support for our expanding operations. To date, we have funded our operations primarily through private placements of our redeemable convertible preferred stock.

We have incurred operating losses in each year since our inception. Our net losses were $191.9 million and $88.7 million for the years ended December 31, 2025 and 2024, respectively. As of December 31, 2025, we had an accumulated deficit of $281.1 million. Our 2025 operating results also reflect significant year-over-year increases in research and development and general and administrative expenses, driven by the progression of our therapeutic programs, increased headcount, integration of acquired assets, and expanded clinical and operational activities. We expect our expenses and operating losses will increase substantially as we:

• conduct our ongoing and planned clinical trials, including KINSHIP-DCM, our ongoing
Phase 2b/3 clinical trial of Danicamtiv, KATALYST-AV, our ongoing Phase 2b/3 clinical trial of Ataciguat, and KARDINAL-ASH, our Phase 2 clinical trial of Tonlamarsen;

• continue to develop our Prolaio platform;

• seek regulatory approvals from the U.S. Food and Drug Administration (the "FDA") or other foreign regulatory
authorities for our product candidates that successfully complete clinical trials;

• utilize third parties to manufacture our current and future product candidates and related raw materials or, should we
decide to do so, build and maintain a commercial-scale current Good Manufacturing Practices ("cGMP") manufacturing facility;

• continue our research and development activities;

• seek to identify additional research programs and program candidates to expand our pipeline;

• hire additional research and development, clinical, commercial and operational personnel;

• continue to invest in the Prolaio platform to enhance our drug discovery and development efforts;

• seek to identify, acquire and develop additional product candidates, including through business development efforts to
invest in or in-license other technologies or product candidates, which may include opportunities to leverage our Prolaio platform;

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• make milestone, royalty or other payments due under our existing license agreements with MyoKardia, BMS Co., Sanofi, Mayo
and Ionis and our purchase agreements with RSF and Prolaio, Inc., and any future in-license or collaboration agreements;

• make milestone, royalty, interest or other payments due under any future financing or other arrangements with third
parties;

• seek regulatory approvals for any current or future product candidates for which we successfully complete clinical trials;

• ultimately establish a sales, marketing and distribution infrastructure to commercialize any therapies for which we may
obtain marketing approval; and

• incur additional costs associated with being a public company, including audit, legal, regulatory and tax-related services associated with maintaining compliance with an exchange listing and Securities Exchange Commission (the "SEC") requirements, director and officer insurance premiums and investor
relations costs.

In addition, we have several preclinical and clinical development, regulatory and commercial milestone payment obligations under our licensing arrangements. Our net losses may fluctuate significantly from quarter-to-quarter and year-to-year, depending on the timing of our preclinical studies and our ongoing and planned clinical trials and our expenditures on other research and development activities. Furthermore, upon the closing of this offering, we expect to incur additional costs associated with operating as a public company.

As of December 31, 2025, we had cash, cash equivalents and short-term investments of $335.5 million, and accumulated deficit of $281.1 million. As disclosed in our audited financial statements included elsewhere in this prospectus, management and our independent registered public accounting firm have concluded that substantial doubt exists about our ability to continue as a going concern within one year after the date the financial statements were available for issuance, because our existing cash, cash equivalents and short-term investments will not be sufficient to fund our operating activities for at least twelve months from that date. Based upon our current operating plans, we believe that the estimated net proceeds from this offering, together with our existing cash, cash equivalents and short-term investments, will be sufficient to fund our operations through . See "*Use of Proceeds*."

We do not expect to generate any revenue from product sales unless and until we successfully complete development and obtain regulatory approval for one or more of our current or future product candidates, which will not be for at least the next several years, if ever. If we obtain regulatory approval for any of our current or future product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Accordingly, until such time as we can generate significant revenue from sales of our current or future product candidates, if ever, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, including potential collaborations, licenses and other similar arrangements. See "*Liquidity and Capital Resources*." However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. Our failure to raise capital or enter into such other arrangements when needed would have a negative impact on our financial condition and could force us to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market current or future product candidates that we would otherwise prefer to develop and market ourselves.

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**Components of results of operations** 

***Revenue***

We currently have no products approved for sale, and we have not generated any revenue to date. In the future, we may generate revenue from collaboration or license agreements we may enter into with respect to our current or future product candidates, as well as product sales from any approved product, which approval we do not expect to occur for at least the next several years, if ever. Our ability to generate product revenue will depend on the successful development and eventual commercialization of any current or future product candidates we may pursue. If we fail to complete preclinical and clinical development of our current or future product candidates or obtain regulatory approval for them, our ability to generate future revenues and our results of operations and financial position would be adversely affected.

***Operating expenses***

*Research and development expenses* 

Research and development expenses consist primarily of personnel-related costs, including salaries, bonuses, benefits and stock-based compensation charges for those individuals in research and development functions, other internal and external costs associated with our research and development activities, our discovery and research efforts and the preclinical and clinical development of our current and future product candidates. In particular, our research and development expenses include:

• personnel-related costs, including salaries, bonuses, benefits and stock-based compensation for employees engaged in
research and development functions;

• expenses related to manufacturing our product candidates for clinical trials and preclinical studies, including fees paid
to contract manufacturing organizations ("CMOs");

• external expenses, including expenses incurred under arrangements with third parties, such as contract research
organizations, consultants and our scientific advisors;

• the cost of developing and validating our manufacturing process for use in our preclinical studies and ongoing and future
clinical trials;

• the cost to obtain licenses to intellectual property and related future payments should certain development and regulatory
milestones be achieved;

• expenses related to compliance with regulatory requirements;

• expenses related to research and development of our Prolaio platform;

• costs of conducting internal research and development for our preclinical programs

• costs for laboratory supplies, research materials and reagents; and

• facility costs, depreciation and other expenses, which include direct and allocated expenses.

We expense research and development costs as incurred. Non-refundable advance payments that we make for goods or services to be received in the future for use in research and development activities are recorded as prepaid expenses. The prepaid amounts are expensed as the related goods are delivered or the services are performed, or when it is no longer expected that the goods will be delivered or the services rendered.

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We record accruals for estimated ongoing research costs and receive updated estimates of costs and amounts owed on a monthly basis from our third-party service providers. When evaluating the adequacy of the prepaid expenses and accrued liabilities, we analyze progress of the studies, including the phase or completion of events, invoices received and contracted cost estimates from our third-party service providers. Estimates are made in determining the balances at the end of any reporting period. We monitor each of these factors and adjust estimates accordingly.

A significant portion of our research and development costs have been, and will continue to be, external costs. External costs, which are specific to a product candidate, are tracked on a product candidate-by-product candidate basis upon our designation of a preclinical asset as a product candidate. Due to our ability to use certain resources across several programs, personnel-related expenses and indirect or shared operating costs incurred for our research and development programs are not recorded or maintained on a product candidate-by-product candidate basis.

We plan to substantially increase our research and development expenses for the foreseeable future as we continue to conduct our ongoing research and development activities, expand our pipeline, advance our preclinical research programs toward clinical development and conduct our current and planned clinical trials.

The timelines and costs of research and development activities are uncertain and can vary significantly for each current and future product candidate and development program due to the inherently unpredictable nature of preclinical and clinical development. We anticipate we will make determinations as to which programs to pursue and how much funding to direct to each program on an ongoing basis in response to preclinical and clinical results, regulatory developments and ongoing assessments as to each program's commercial potential.

Our future development costs may vary significantly based on various factors such as:

• the scope, timing, costs and progress of clinical development activities related to Danicamtiv, Ataciguat and Tonlamarsen
and any future product candidates;

• the number and scope of additional preclinical and clinical programs we decide to pursue, and the number of product
candidates we decide to develop further;

• the costs, timing and outcome of regulatory review of our product candidates and any other product candidates we may
identify and develop;

• maintaining existing, or arranging for new CMOs, to support clinical trials of our product candidates;

• the costs of developing our Prolaio platform;

• receipt of marketing approvals from applicable regulatory authorities;

• our ability to commercialize products, if and when approved;

• the rate and degree of market acceptance of our products;

• milestone payments and other collaboration-based payments;

• establishment and maintenance of arrangements with third parties;

• intellectual property updates and continued acceptable safety;

• the extent of changes in government regulation and regulatory guidance; and

• tolerability and efficacy profile of any current and future product candidates that we may develop following approval.

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A change in the outcome of any of these variables with respect to the development of any current or future product candidate could mean a significant change in the costs and timing associated with the development of that product candidate. For example, if the U.S. Food and Drug Administration (the "FDA"), the European Medicines Agency (the "EMA") or another regulatory authority were to require us to conduct clinical trials beyond those that we anticipate would be required for the completion of clinical development of a product candidate, or if we experience significant delays in our clinical trials due to slower than expected patient enrollment or other reasons, we would be required to expend significant additional financial resources and time on the completion of clinical development.

*General and administrative expenses* 

General and administrative expenses consist primarily of personnel-related costs, including salaries, bonuses, benefits and stock-based compensation charges for those individuals in executive, legal, finance, human resources, facility operations and other administrative functions. Other significant costs include legal fees relating to intellectual property and corporate matters, professional fees for auditing, accounting, tax and consulting services, office and information technology costs, insurance costs, and facilities, depreciation and other general and administrative expenses, which include direct or allocated expenses for rent and maintenance of facilities and utilities.

We anticipate that our general and administrative expenses will increase for the foreseeable future to support our increased research, development and commercialization activities. These increases will likely include increased costs related to the hiring of additional personnel and fees paid to outside consultants, pre-launch costs and regulatory filing fees, among other expenses. We also anticipate increased expenses related to audit, accounting, legal, regulatory and tax-related services associated with maintaining compliance with the stock exchange and SEC requirements, director and officer insurance premiums and investor relations costs associated with operating as a public company.

*Other income (expense)* 

Other income (expense) primarily consists of interest income generated from interest bearing cash, cash equivalents and short-term investments, change in fair value associated with the financial instruments, and various income or expense items. These amounts may fluctuate significantly from period to period due to changes in market conditions, interest rates, the timing of financing transactions, and the remeasurement of instruments carried at fair value, and therefore may not be indicative of future results.

*Income tax benefit* 

Since we generally establish a full valuation allowance against our deferred tax balances, our income tax benefit primarily consists of tax impacts of our deferred income tax assessments resulting from our acquisitions.

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**Results of operations** 

***Comparison of the years ended December 31, 2025 and 2024***

The following table summarizes our results of operations for the years ended December 31, 2025 and 2024 (in thousands):

---

| | | |
|:---|:---|:---|
|  | **Years Ended<br>December 31,** | **Years Ended<br>December 31,** |
| | **2025** | **2024** |
|  Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development | $153086 | $84294 |
| &nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 48750 | 12362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 201836 | 96656 |
|  Loss from operations | (201836) | (96656) |
|  Other income (expense): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest income | 6850 | 1293 |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of preferred stock tranche obligations | 1100 | 6751) |
| &nbsp;&nbsp;&nbsp;&nbsp; Bargain purchase gain | 5232 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Warrant issuance expense | (7358) | —) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other expense, net | (441) | (46) |
|  Loss before income taxes | (196453) | (88658) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income tax benefit | 4512 |  |
|  Net loss | $(191941) | $(88658) |

---

*Research and development expenses* 

The following table summarizes our research and development expenses for the years ended December 31, 2025 and 2024 (in thousands):

---

| | | |
|:---|:---|:---|
|  | **Years Ended<br>December 31,** | **Years Ended<br>December 31,** |
| | **2025** | **2024** |
|  Program expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Ataciguat | $29126 | $17477 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Tonlamarsen | 23874 | 21986 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Danicamtiv | 13788 | 23896) |
|  Research and development—compensation and benefits | 49761 | 8176 |
|  Research and development—other | 36537 | 12759 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total Research and development expense | $153086 | $84294 |

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Research and development expenses were $153.1 million for the year ended December 31, 2025, compared to $84.3 million for the year ended December 31, 2024. The $68.8 million increase year over year, was primarily driven by expanded research and development activities across our Ataciguat, Tonlamarsen and Danicamtiv programs, which resulted in $60.0 million of higher program-related expenses. This increase was partially offset by a lower acquired in-process research and development ("IPR&D") expenses, as the prior year included substantial upfront costs associated with acquired licensed intellectual property. Acquired IPR&D expenses totaled $3.3 million for the year ended December 31, 2025, consisting primarily of a $3.0 million milestone

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payment under the RSF merger agreement, compared to $65.4 million for the year ended December 31, 2024, primarily related to licensed intellectual property acquired from RSF, BMS Co., and Ionis.

The change was also driven by a $41.6 million increase in compensation and benefits costs, largely attributable to the headcount growth supporting our expanding research and development activities. In addition, other research and development expenses increased by $23.8 million, reflecting higher use of professional services and outside consultants of $7.7 million, a $3.9 million increase in depreciation and amortization expense, primarily related to intangible assets recognized upon Prolaio acquisition, $3.9 million of higher facilities costs, and $3.9 million increase in project materials, lab supplies and outside services, with the remainder attributable to other individually insignificant factors.

*General and administrative expenses* 

General and administrative expenses were $48.8 million for the year ended December 31, 2025, compared to $12.4 million for the year ended December 31, 2024. The increase of $36.4 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, was primarily driven by an increase of $26.5 million in personnel-related costs and an increase of $9.9 million of other expenses, including higher professional services, insurance, facilities-related costs and other corporate overhead.

*Interest income* 

Interest income was $6.9 million for the year ended December 31, 2025, compared to $1.3 million for the year ended December 31, 2024. The increase of $5.6 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, was primarily attributable to higher average balances of cash, cash equivalents, and short-term marketable securities, following the additional preferred stock issuances completed during the year ended December 31, 2025. We continued to invest the excess cash in short-term investment instruments, which, together with prevailing interest rate conditions, resulted in higher interest income for the current period.

*Change in fair value of preferred stock tranche obligations* 

Change in fair value of Series A preferred stock tranche obligations, net was $1.1 million for the year ended December 31, 2025, compared to $6.8 million for the year ended December 31, 2024. The decrease of $5.7 million for the year ended December 31, 2025, compared to the year ended December 31, 2024, was primarily attributable to period-to-period fluctuations in the estimated fair values of the preferred stock tranche obligations, which reflect changes in valuation assumptions, including the probability and expected timing of milestone achievement and other market-driven inputs.

*Bargain purchase gain* 

Bargain purchase gain of $5.2 million for the year ended December 31, 2025 related to the bargain purchase gain recognized upon acquisition of Prolaio completed in the year ended December 31, 2025.

*Warrant issuance expense* 

Warrant issuance expense of $7.4 million for the year ended December 31, 2025 represents the fair value of the warrants issued in connection with the Series B preferred stock financing to a select group of investors that led the financing round as economic incentive for their role.

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*Income tax benefit* 

In the year ended December 31, 2025, we recorded an income tax benefit of $4.5 million due to deferred tax liabilities assumed in connection with our acquisition of Prolaio, which supported the realizability of our deferred tax assets and resulted in a partial release of our valuation allowance.

**Liquidity and capital resources** 

***Sources of liquidity***

Since our inception, we have incurred significant operating losses and negative cash flows from operations. We expect to incur significant expenses and operating losses for the foreseeable future as we advance our pipeline and develop our Prolaio platform. Further, upon the completion of this offering, we expect to incur additional costs associated with operating as a public company. As disclosed in our audited consolidated financial statements included elsewhere in this prospectus, we have a limited operating history and have incurred substantial net losses since inception, and management has concluded that substantial doubt exists about our ability to continue as a going concern within one year after the date the financial statements were available to be issued. From our inception through December 31, 2025, we have received aggregate gross proceeds of $558.3 million from the sale of our redeemable convertible preferred stock in private placements. We have not generated any revenue or received cost-sharing payments under collaboration or licensing agreements.

***Future funding requirements***

As of December 31, 2025, we had cash, cash equivalents and short-term investments of $335.5 million. We believe that our existing cash, cash equivalents and short-term investments, together with the net proceeds from our issuance of $10.0 million in Series B redeemable convertible preferred stock in March 2026 and the anticipated net proceeds from this offering, will enable us to fund our operating expenses and capital expenditure requirements through . We have based this estimate on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. However, our forecast for the period of time through which our financial resources will be adequate to support our operations is a forward-looking statement that involves risks and uncertainties and actual results could vary materially. Additionally, the process of conducting preclinical studies and testing product candidates in clinical trials is costly, and the timing of progress and expenses in these studies and trials is uncertain. We will need to raise substantial additional capital in the future.

Our future capital requirements will depend on many factors, including but not limited to:

• the type, number, scope, progress, expansions, results, costs and timing of, discovery, preclinical studies and clinical
trials of our current and future product candidates;

• the costs associated with maintaining, improving and developing our Prolaio platform;

• the costs and timing of manufacturing for our current and future product candidates and commercial manufacturing;

• the costs, timing and outcome of regulatory review of our current and future product candidates;

• the terms and timing of establishing and maintaining licenses and other similar arrangements;

• the legal costs of obtaining, maintaining and enforcing our patents and other intellectual property rights;

• our efforts to enhance operational systems and hire additional personnel to satisfy our obligations as a public company;

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• the costs associated with hiring additional personnel and consultants as our preclinical and potential future clinical
activities increase;

• the costs and timing of establishing or securing sales and marketing capabilities if any current and future product
candidate is approved;

• our ability to achieve sufficient market acceptance, coverage and adequate reimbursement from third-party payors and
adequate market share and revenue for any approved products; and

• costs associated with any products or technologies that we may in-license or
acquire.

Until such time, if ever, as we can generate substantial product revenue to support our cost structure, we expect to finance our cash needs through equity offerings, debt financings or other capital sources, potentially including collaborations, licenses and other similar arrangements. However, we may be unable to raise additional funds or enter into such other arrangements when needed on favorable terms or at all. To the extent that we raise additional capital through the sale of equity or convertible debt securities, the ownership interest of our stockholders will be or could be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing and equity financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If we raise funds through collaborations or other similar arrangements with third parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs, current or future product candidates or grant licenses on terms that may not be favorable to us and/or may reduce the value of our common stock. Our failure to raise capital or enter into such other arrangements when needed could have a negative impact on our financial condition and on our ability to pursue our business plans and strategies. If we are unable to raise additional funds through equity or debt financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization efforts or grant rights to develop and market our current and future product candidates even if we would otherwise prefer to develop and market such product candidates ourselves.

**Cash flows** 

***Comparison of the years ended December 31, 2025 and 2024***

The following table sets forth a summary of the net cash flow activity for the years ended December 31, 2025 and 2024 (in thousands):

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| | | |
|:---|:---|:---|
|  | **Years Ended<br>December 31,** | **Years Ended<br>December 31,** |
| | **2025** | **2024** |
|  Net cash used in operating activities | $(151056) | $(18825) |
|  Net cash used in investing activities | (237037) | (36419) |
|  Net cash provided by financing activities | 447807 | 105009 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net increase in cash, cash equivalents and restricted cash | $59714 | $49765 |

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*Operating activities* 

For the year ended December 31, 2025, net cash used in operating activities was $151.1 million, compared to $18.8 million for the year ended December 31, 2024. The $132.2 million increase in operating cash usage primarily reflects our expanded operating scale following multiple equity financings in 2025, continued advancement of our development portfolio and organizational growth to support these initiatives.

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Net cash used in operating activities for the year ended December 31, 2025 was primarily driven by our net loss of $191.9 million, partially offset by adjustments to the net loss totaling $34.5 million. The adjustments to the net loss included stock-based compensation expense of $15.9 million, integration bonus expense of $14.4 million, warrant issuance expense of $7.4 million, depreciation and amortization expense of $4.2 million, and acquired IPR&D expense of $3.3 million, partially offset by a bargain purchase gain of $5.2 million and $4.5 million of deferred income tax benefit recognized upon acquisition of Prolaio. Operating cash flows were further impacted by $6.4 million of cash outflows due to changes in operating assets and liabilities, reflecting the higher level of operating activity in 2025 relative to the prior year.

For the year ended December 31, 2024, net cash used in operating activities was $18.8 million, reflecting our more limited operating scale prior to the 2025 equity financings and subsequent acquisition activity. Operating cash usage was primarily driven by our net loss of $88.7 million, partially offset by adjustments to the net loss including acquired IPR&D expense of $65.4 million and stock-based compensation expense of $6.0 million, partially offset by a $6.8 million gain related to the change in fair value of preferred stock tranche obligations. Operating cash flows were further impacted by $4.9 million of net cash outflow from changes in operating assets and liabilities.

*Investing activities* 

For the year ended December 31, 2025, net cash used in investing activities was $237.0 million, compared to $36.4 million for the year ended December 31, 2024. The $200.6 million increase was driven primarily by our investments of excess liquidity into short-term marketable securities.

Cash used in investing activities the year ended December 31, 2025 consisted primarily of $226.4 million of net purchases of short-term investments, $5.1 million used to purchase property and equipment to support the expansion of our laboratory, and corporate infrastructure, $4.0 million used towards payment of consideration on acquisition of Prolaio, net of cash acquired, and $1.5 million used for milestone payments under acquired license agreements.

For the year ended December 31, 2024, net cash used in investing activities was $36.4 million, which primarily related to the purchase of acquired IPR&D assets in amount of $34.6 million.

*Financing activities* 

For the year ended December 31, 2025, net cash provided by financing activities was $447.8 million, compared to $105.0 million for the year ended December 31, 2024. The increase in financing cash inflows primarily reflects our completed equity financings in 2025, which generated $453.6 million of net proceeds during the year from the issuance of preferred stock, after deducting issuance costs. These inflows were partially offset by $6.4 million of tax withholding payments related to the integration bonus.

For the year ended December 31, 2024, net cash provided by financing activities was $105.0 million, which primarily consisted of $102.0 million proceeds from the issuance of preferred stock, net of issuance costs, and $2.4 million in proceeds from the exercise of stock options.

***Contractual obligations and commitments***

***Leases***

We lease office space in South San Francisco, California under an operating lease that expires in April 2030 and lease office space in Princeton, New Jersey under an operating lease that expires in May 2033. See Note 7 in our audited consolidated financial statements appearing elsewhere in this prospectus for more information on our lease obligations.

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***Purchase and other obligations***

We enter into contracts in the normal course of business with third-party CROs, CMOs and other third-party vendors for preclinical, clinical trials and testing and manufacturing services. These contracts do not contain minimum purchase commitments and are cancellable by us upon written notice. Payments due upon cancellation generally consist of payments for services provided or expenses incurred up to the date of cancellation, including non-cancelable obligations of our service providers and, in some cases, wind-down costs. For further information regarding certain of our license agreements and amounts that could become payable in the future under those agreements, please see Note 8 in our audited consolidated financial statements appearing elsewhere in this prospectus.

***Merger agreements***

*Acquisition of Prolaio* 

On February 24, 2025, we entered into an Agreement and Plan of Merger (the "Prolaio Merger Agreement"), with Prolaio, pursuant to which we acquired 100% of the outstanding capital stock of Prolaio. Through the acquisition of Prolaio, we gained access to Prolaio's cardiovascular data collection and analytics platform. The total purchase consideration transferred was approximately $8.6 million, consisting of approximately $4.0 million in cash, primarily used to settle certain of Prolaio's outstanding debts, and fair value of contingent consideration of $4.6 million, representing the estimated acquisition date fair value of milestone payments.

We concluded that Prolaio constitutes a business and the transaction was accounted for as a business combination. In connection with the acquisition, we recorded $13.8 million of net assets acquired, primarily consisting of developed technology with a fair value of $25.4 million, acquired IPR&D asset with a fair value of $1.1 million, and $13.8 million in liabilities assumed, including $4.5 million of deferred income tax liability and $3.3 million of assumed contingent consideration liability. Because the fair value of net identifiable assets acquired exceeded the fair value of the consideration transferred, we recognized a gain on bargain purchase in amount of $5.2 million in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2025.

Upon the consummation of the merger, Prolaio became our wholly-owned subsidiary. Pursuant to the Prolaio Merger Agreement, and subject to the conditions therein, the former stockholders of Prolaio are entitled to certain milestone payments upon the achievement of various post-closing milestones, in an amount of up to $200.0 million in the aggregate, payable in cash or shares. None of the Prolaio milestones had been achieved as of December 31, 2025.

*Acquisition of RSF* 

On March 11, 2024, we entered into an Agreement and Plan of Merger with RSF, pursuant to which, on June 6, 2024, we acquired 100% of outstanding capital stock of RSF. RSF holds a patent license and know-how agreement with Mayo, originally effective December 6, 2019, as amended, granting an exclusive license to Mayo's proprietary methods and materials for treating calcific aortic valve stenosis. RSF also holds four exclusive option agreements with Mayo covering additional small-molecule programs and indications. The acquisition included Ataciguat (HMR1766), in addition to RSF's other existing agreements such as supply and license agreements with Sanofi and its affiliates. The closing was conditioned upon our completion of a Series A Preferred Stock financing with gross proceeds of at least $150.0 million, which condition was satisfied on June 6, 2024.

As initial consideration, the acquisition involved upfront cash payments totaling $3.5 million, the settlement of RSF's outstanding indebtedness of $10.6 million on June 6, 2024, and the payment of certain transaction costs

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of $0.7 million incurred by RSF. We accounted for the transaction as the acquisition of a VIE that is not a business. The net assets acquired consisted primarily of the IPR&D asset, cash and cash equivalents in amount of $0.2 million, and assumed accounts payable for an amount of $1.3 million. Accordingly, the consideration allocated to the IPR&D asset amounted to $15.9 million. The acquired licensed technology was determined to be an IPR&D asset that did not have alternative future use as of the acquisition date, and the full amount was recognized as research and development expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024.

In addition to the initial consideration, we are obligated to make potential milestone payments of up to $26.5 million in development and regulatory milestones, and up to $249.5 million in sales milestones, as well as low-single digit tiered royalties on annual net sales of any pharmaceutical product containing Ataciguat. The royalty term ends on a product-by-product and country-by-country basis on the earliest of (i) our cessation of development or commercialization of the applicable product, (ii) the expiration of the last-to-expire valid patent claim covering the product in such country, or (iii) the first commercial sale of a generic product in the same indication in such country.

During the year ended December 31, 2025, we achieved the first development milestone associated with Ataciguat upon dosing of the first patient in the Phase 3 clinical trial. This milestone triggered a payment obligation of $3.0 million. As a result, we recognized $3.0 million in research and development expenses for the year ended December 31, 2025 in our consolidated statement of operations and comprehensive loss. Of the total milestone amount, $1.5 million was settled in cash and the remaining $1.5 million was accrued for in our consolidated balance sheet as of December 31, 2025 within accrued and other current liabilities. None of the other RSF milestones had been achieved nor were deemed probable and estimable as of December 31, 2025.

**License and collaboration agreements** 

Below is a summary of the key terms for certain of our license and collaboration agreements. For a more detailed description of these agreements, see the section titled "*Business—License and Collaboration Agreements*."

***License agreements with BMS Co.***

In November 2024, we entered into a License Agreement with MyoKardia, a wholly owned subsidiary of BMS Co., related to Danicamtiv and other compounds (the "Dani Agreement"), and a separate License Agreement with BMS Co. related to KAR-141 (formerly known as BMS-986141) ("Par4") and other compounds (the "Par4 Agreement").

*Dani agreement* 

Under the Dani Agreement, we received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain MyoKardia patents and know-how to develop, manufacture, and commercialize Danicamtiv (formerly known as MYK-491) and certain related compounds (collectively, the "Dani Licensed Compounds") and pharmaceutical products containing such Dani Licensed Compounds (the "Dani Licensed Products") for all human uses worldwide. As partial consideration for the rights granted to us under the Dani Agreement, we entered into a Subscription Agreement with MyoKardia pursuant to which we issued 1,251,107 shares of Series A Preferred Stock to MyoKardia. As additional consideration for the licenses granted under the Dani Agreement, we are required to pay MyoKardia: (i) tiered royalties at a rate based on aggregate annual net sales by us, our affiliates and sublicensees of each Dani Licensed Product containing the

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same Dani Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by us, if we sublicense to a third party within a certain number of months from the effective date, or November 2026; (iii) up to $42.5 million in the aggregate in development and regulatory milestone payments across all Dani Licensed Products and (iv) up to $265.0 million in sales milestone payments for each of the first two Dani Licensed Products to achieve the applicable sales milestones. Our tiered royalties range from a subteen to high teen percentage of annual net sales of the Dani Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to competition from generic products, for certain third party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act of 2022 (the "Inflation Reduction Act"), subject to a customary reduction floor and potential carry-forward.

*Par4 agreement* 

Under the Par4 Agreement, we received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain BMS Co. patents and know-how to develop, manufacture, and commercialize Par4 and certain related compounds (collectively, the "Par4 Licensed Compounds") and pharmaceutical products containing such Par4 Licensed Compounds ("Par4 Licensed Products") for all human uses worldwide. As partial consideration for the rights granted under the Par4 Agreement, we entered into a Subscription Agreement with BMS Co. pursuant to which we issued 293,469 shares of Series A Preferred Stock. As additional consideration for the licenses granted under the Par4 Agreement, we are required to pay BMS Co.: (i) tiered royalties at a rate based on aggregate annual net sales by us, our affiliates and sublicensees of each Par4 Licensed Product containing the same Par4 Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by us, if we sublicense to a third party within a certain number of months from the effective date, or November 2026; (iii) up to $10.0 million in the aggregate in development and regulatory milestone payments across all Par4 Licensed Products and (iv) up to $265.0 million in sales milestone payments for each of the first two Par4 Licensed Products to achieve the applicable sales milestones. Our tiered royalties range from a subteen to high teen percentage of annual net sales of the Par4 Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to competition from generic products, for certain third party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act, subject to a customary reduction floor and potential carry-forward.

In connection with the Dani and Par4 license agreements, we issued an aggregate of 1,544,576 shares of Series A preferred stock to MyoKardia and BMS Co., including 1,251,107 shares of Series A preferred stock under the Dani Agreement, and 293,469 shares of Series A preferred stock under Par4 Agreement, at the estimated fair value of $19.10 per share as of issuance date, with a total estimated fair value of $29.5 million. We determined that the Dani and Par4 licenses represent acquired IPR&D assets that did not have alternative future use as of the acquisition date, and, accordingly, an amount of $29.5 million was recognized as research and development expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024. As of December 31, 2025, none of the Dani milestones or Par4 milestones had been achieved nor were deemed probable or estimable.

*License agreement with Ionis* 

On June 7, 2024, we entered into a License Agreement (the "Ionis License Agreement") with Ionis, pursuant to which we were granted an exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to develop and commercialize Tonlamarsen (formerly ION904) and products containing Tonlamarsen (the "Licensed Ionis Products") in the field of prophylactic or therapeutic use in humans (the "Ionis Licensed Field"). We also received a non-exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to manufacture Tonlamarsen and Licensed Ionis Products in the Ionis Licensed Field.

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Until the third anniversary of the effective date of the Ionis License Agreement, or June 2027, neither party may develop or commercialize, or assist or grant a third party rights to develop or commercialize certain ASOs designed to bind to the RNA encoded by the human angiotensinogen gene, subject to certain conditions and exceptions. As initial consideration for the Ionis License Agreement, we made an upfront payment of $20.0 million to Ionis. We determined that the licenses represent an acquired IPR&D asset that did not have alternative future use as of the acquisition date, and, accordingly, the total amount of the upfront payment of $20.0 million was recognized as research and development expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024.

As additional consideration for the licenses and rights granted to us by Ionis, we are required to pay Ionis: (i) milestone payments in the event of successful achievement of specified development and sales milestones of up to an aggregate of $375.0 million (up to $35.0 million in development and regulatory milestone payments and up to $340.0 million in sales milestone payments); (ii) tiered royalties on net sales of Ionis Licensed Products by us, our affiliates and sublicensees with a rate based on net sales per calendar year, ranging from a subteen percentage to high teen percentage. The royalties are subject to potential reductions under certain scenarios. In the event that we undergo a change of control prior to receiving regulatory approval and are acquired by one of certain top biopharmaceutical or pharmaceutical companies, we will be required to pay Ionis a one-time change of control payment based on the acquisition price, ranging in the low tens of millions of dollars. The payment will accrue interest at a subteen percentage per annum, compounded annually, from the date of the Ionis License Agreement through the date such payment is made. As of December 31, 2025, none of the Ionis milestones had been achieved nor were deemed probable and estimable.

*License agreement with Sanofi* 

On June 2, 2021, RSF entered into a license agreement with Sanofi, as subsequently amended on March 18, 2022, January 9, 2023, and November 7, 2025 (collectively, the "Sanofi License"), under which RSF received a worldwide, exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Sanofi know-how to exploit Ataciguat (also known as HMR1766) and pharmaceutical products containing Ataciguat ("Ataciguat Products") for all human and mammalian therapeutic, prophylactic and diagnostic uses (the "Sanofi License Field"). RSF became our wholly owned subsidiary in June 2024. If we succeed in developing and commercializing Ataciguat Products, we will be obligated to pay Sanofi up to an aggregate of $14.8 million in potential commercial milestone payments. As of December 31, 2025, none of the Sanofi milestones had been achieved nor were deemed probable and estimable. We are also obligated to pay Sanofi tiered royalties ranging from low-single digit to mid-single digit percentages on worldwide annual net sales of Ataciguat Products by us or our affiliates and sublicensees.

*Patent license and know-how agreement with Mayo* 

On December 6, 2019, RSF entered into a license agreement with Mayo, as amended on May 20, 2021, August 23, 2023, March 10, 2024, June 6, 2024, and December 22, 2025 (collectively, the "Mayo License"), under which RSF received (i) a worldwide exclusive license with the right to sublicense (through multiple tiers) under certain Mayo patent rights, (ii) a nonexclusive license with the right to sublicense (through multiple tiers) to use certain know-how and materials, and (iii) a nonexclusive worldwide license, with the right to sublicense (through multiple tiers), subject to approval from Mayo, to use certain Mayo data, in each case in (i) through (iii), to develop, make, have made, use, offer for sale, sell, and import certain licensed products, including Ataciguat, for the prevention, diagnosis, and/or treatment of any and all human diseases and conditions. We are also obligated to pay Mayo up to $0.3 million in development and regulatory milestone payments and up to $1.3 million in commercial milestone payments for each licensed product to achieve the corresponding milestone events. As of December 31, 2025, none of the Mayo milestones had been achieved nor were deemed probable and estimable.

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We are also obligated to pay Mayo royalties ranging from a mid-single digit to subteen percentage of worldwide annual net sales by us, our affiliates and sublicensees of licensed products. In the event that we are required to pay a non-affiliate third party certain consideration for a license under intellectual property rights owned or controlled by such non-affiliate third party that are required for the manufacture, use or sale of the licensed products, we can deduct a certain amount of such consideration from the royalty payments due to Mayo under the Mayo Agreement, subject to a customary reduction floor.

**Critical accounting policies and estimates** 

Our management's discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which are prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). The preparation of our consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, costs and expenses and the disclosure of contingent assets and liabilities in our consolidated financial statements and accompanying notes. We base our estimates and assumptions on historical experience and other factors that we believe to be reasonable under the circumstances. We evaluate our estimates and judgments on an ongoing basis. We base our estimates on historical experience, known trends and events and various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Our actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are more fully described in Note 2, *"Summary of Significant Accounting Policies"* to our financial statements appearing elsewhere in this prospectus, we believe that the following accounting policies are the most critical for fully understanding and evaluating our financial condition and results of operations.

***Research and development expenses and accruals***

We record research and development expenses to operations as incurred. Research and development expenses represent costs incurred by us for the discovery and development of our product candidates and the development of our technology and include employee salaries, benefits and stock-based compensation, third-party research and development expenses, including contract manufacturing and research services, consulting expenses, laboratory supplies and certain allocated expenses, as well as amounts incurred under license agreements.

As part of preparing our financial statements, we are required to estimate and accrue expenses. We estimate preclinical study and clinical trial and other research and development expenses based on the services performed, pursuant to contracts with research institutions and third-party service providers that conduct and manage preclinical studies and clinical trials and research services on our behalf. We record the costs of research and development activities based upon the estimated services provided but not yet invoiced and include these costs in accrued expenses and other current liabilities in our consolidated balance sheets and in research and development expense in our consolidated statements of operations and comprehensive loss. We make significant judgments and estimates in determining the accrued balance in each reporting period. As actual costs become known, we adjust our accrued estimates. Although we do not expect our estimates to be materially different from amounts actually incurred, our understanding of the status and timing of services performed may vary from our estimates and could result in us reporting amounts that are too high or too low in any particular period. Our accrued expenses are dependent, in part, upon the receipt of timely and accurate reporting from external third-party service providers. Amounts ultimately incurred in relation to amounts accrued for these services at a reporting date may be substantially higher or lower than our estimates.

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Contingent milestone payments, if any, are expensed when the milestone results are probable and estimable, which is generally upon the achievement of the milestone.

Our expenses related to clinical trials are based on estimates of patient enrollment and related expenses at clinical investigator sites as well as estimates for the services provided and efforts expended pursuant to contracts with multiple research institutions and contract research organizations that may be used to conduct and manage clinical trials on our behalf. We generally accrue expenses related to clinical trials based on contracted amounts applied to the level of patient enrollment and activity. If timelines or contracts are modified based upon changes in the clinical trial protocol or scope of work to be performed, we modify our estimates of accrued expenses accordingly on a prospective basis.

***Asset acquisitions and acquired IPR&D expenses***

We measure and recognize asset acquisitions that are not deemed to be business combinations based on the cost to acquire the asset or group of assets, which includes transaction costs. We determine if the acquisition should be accounted for as an asset acquisition after considering whether substantially all of the fair value of the gross assets acquired was concentrated in a single asset or group of assets and whether we acquired a substantive process capable of significantly contributing to our ability to create outputs. Goodwill is not recognized in asset acquisitions. If acquired in-process technology assets, including licenses, know-how and patents are determined to not have an alternative future use, the cost is charged to research and development expenses at the acquisition date. Contingent consideration in asset acquisitions payable in the form of cash is recognized in the period the triggering event is determined to be probable of occurrence and the related amount is reasonably estimable. Such amounts are expensed or capitalized based on the nature of the associated asset at the date the related contingency is probable and reasonably estimable.

***Preferred stock tranche obligations***

We determined that the obligation to issue additional shares of redeemable convertible preferred stock upon the occurrence of certain events, represents a freestanding financial instrument. The instrument is initially recognized at fair value at the issuance date and is classified as either asset or a liability on the consolidated balance sheets, and is subject to re-measurement at each balance sheet date and at the settlement date. Any change in fair value is recognized in the consolidated statements of operations and comprehensive loss. Fair value is estimated using a probability-weighted expected return method as it represents a contingent commitment for the additional shares. The fair value incorporates assumptions including the fair value per share of the Series A preferred stock as of each measurement date, the probability of meeting certain milestone events, the expected time until certain milestone events would be met, and the discount rate.

***Stock-based compensation***

We measure stock-based awards granted to employees, directors and non-employees based on their fair value on the date of the grant and recognize compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award. For stock-based awards with service-based vesting conditions, we recognize compensation expense using the straight-line method. Expense related to stock options that contain performance conditions is recognized only when it is considered probable that the performance condition will be achieved. For performance and market awards, stock-based compensation expense is recognized over the requisite service period using the accelerated attribution method. The fair value of each stock option grant is estimated on the date of grant using the Black-Scholes option-pricing model, which requires inputs based on certain subjective assumptions, including the expected stock price volatility, the expected term of the option, the risk-free interest rate for a period that approximates the expected term of the

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option and our expected dividend yield. Awards containing market-based conditions are valued using a Monte Carlo simulation model at the grant date, which uses assumptions similar to the Black-Scholes model and incorporates Level 3 inputs related to the likelihood of satisfying market conditions. The fair value of each restricted common stock award is estimated on the date of grant based on the fair value of our common stock on that same date.

*Determination of the fair value of common stock* 

As there has been no public market for our common stock to date, the estimated fair value of our common stock has been determined by our board of directors as of the date of each option grant with input from management, considering our most recently available third-party valuations of common stock, and our board of directors' assessment of additional objective and subjective factors that it believed were relevant and which may have changed from the date of the most recent valuation through the date of the grant. These third-party valuations were performed in accordance with the guidance outlined in the American Institute of Certified Public Accountants' Accounting and Valuation Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation.

• Option Pricing Method ("OPM"). Under the OPM, shares are valued by creating a series of call options with
exercise prices based on the liquidation preferences and conversion terms of each equity class. The estimated fair values of the redeemable convertible preferred stock and common stock are inferred by analyzing these options. This method is
appropriate to use when the range of possible future outcomes is so difficult to predict that estimates would be highly speculative, and dissolution or liquidation is not imminent.

• Probability-Weighted Expected Return Method ("PWERM"). The PWERM is a scenario-based analysis that estimates
value per share based on the probability-weighted present value of expected future investment returns, considering each of the possible outcomes available to us, as well as the economic and control rights of each share class.

• Hybrid Method. The Hybrid Method is a hybrid between PWERM and OPM, where the equity value is estimated based on
probability-weighted value across multiple scenarios where the OPM is used to estimate the allocation of value within one or more of those scenarios.

Based on our early stage of development, the difficulty in predicting the range of specific outcomes (and their likelihood), and other relevant factors, the OPM allocation method was considered most appropriate for valuations prior to December 31, 2025. The OPM treats common stock and redeemable convertible preferred stock as call options on the equity value of a company, with exercise prices based on the value thresholds at which the allocation among the various holders of a company's securities changes. Under the OPM, the common stock has value only if the funds available for distribution to stockholders exceeded the value of the redeemable convertible preferred stock liquidation preferences at the time of the liquidity event, such as a strategic sale or a merger.

These third-party valuations were performed at various dates, which resulted in valuations of our common stock of $9.23 per share as of August 27, 2025, $6.37 per share as of November 30, 2024, $8.29 per share as of June 6, 2024, and $2.15 per share as of April 1, 2024. Our board of directors considered various objective and subjective factors to determine the fair value of our common stock as of each grant date, including:

• the prices at which we sold shares of preferred stock and the superior rights and preferences of the preferred stock
relative to our common stock at the time of each grant;

• the lack of an active public market, for our common stock and preferred stock;

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• the progress of our research and development programs, including the status and results of preclinical studies and clinical
trials for our product candidates;

• our stage of development and commercialization and our business strategy, and material risks to our business;

• external market conditions affecting the pharmaceutical and biopharmaceutical industry and trends within each industry;

• our financial position, including cash on hand, and our historical and forecasted performance and operating results;

• the likelihood of achieving a liquidity event, such as an initial public offering or sale of our company in light of
prevailing market conditions; and

• the analysis of initial public offerings and the market performance of similar companies in the biopharmaceutical industry.

The assumptions underlying these valuations were highly complex and subjective and represented management's best estimates, which involved inherent uncertainties and the application of management's judgment. As a result, if we had used significantly different assumptions or estimates, the fair value of our common stock and our stock-based compensation expense could be materially different.

Once a public trading market for our common stock has been established in connection with the completion of this offering, it will no longer be necessary for our board of directors to estimate the fair value of our common stock in connection with our accounting for granted stock options and other such awards we may grant, as the fair value of our common stock will be determined based on the quoted market price of our common stock.

**Emerging growth company and smaller reporting company status** 

We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. We may take advantage of these exemptions until we are no longer an emerging growth company. Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, our consolidated financial statements may not be comparable to companies that comply with public company effective dates. We may take advantage of these exemptions up until the time that we are no longer an "emerging growth company."

We will remain an emerging growth company until the earlier of the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion or (c) in which we are deemed to be a "large accelerated filer" under the rules of the SEC, which means, among other things, the market value of our common stock that is held by non-affiliates exceeds $700.0 million as of the prior June 30<sup>th</sup>, or (d) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. In particular, we have provided only two years of audited financial statements and have not included all of the executive compensation related information that would be required if we were not an "emerging growth company." As a result, the information that we provide to our stockholders may be different than what you might

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receive from other public reporting companies in which you hold equity interests. In addition, the JOBS Act provides that an "emerging growth company" can take advantage of an extended transition period for complying with new or revised accounting standards. We have elected not to "opt out" of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we can adopt the new or revised standard at the time private companies adopt the new or revised standard and may do so until such time that we either (1) irrevocably elect to "opt out" of such extended transition period or (2) no longer qualify as an "emerging growth company."

We are also a "smaller reporting company" as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies until for so long as either (i) our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter or (ii) our annual revenues are less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter.

**Recent accounting pronouncements** 

A description of recently issued accounting pronouncements that may potentially impact our financial position and results of operations is disclosed in Note 2, "*Summary of Significant Accounting Policies*" to our financial statements included elsewhere in this prospectus.

**Off-balance sheet arrangements** 

During the periods presented we did not have, nor do we currently have, any off-balance sheet arrangements as defined in the rules and regulations of the SEC.

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**Business** 

We are a clinical-stage precision therapeutics company developing medicines that target the root cause of specific cardiovascular diseases where no approved treatments exist. Our mission is to develop multiple targeted cardiovascular treatments in parallel that bring people with cardiovascular diseases closer to the cures they deserve. Our team is values-based and mission-driven, led by a proven and experienced management team applying a new philosophy to cardiovascular drug development. We have three late-stage programs, Danicamtiv, Ataciguat, and Tonlamarsen, in clinical development in first-in-indication opportunities intended to create new standards of care for high-need patients.

Our management team, including leaders from MyoKardia, Inc. ("MyoKardia"), has deep domain knowledge of, and proven ability to, navigate the complexity of cardiovascular disease and translate that insight into an innovative drug development approach, delivering with exceptional speed and execution. We believe this uniquely enables us to apply a high degree of precision to cardiovascular drug development, targeting the root causes of disease, rather than later onset cardiovascular symptoms. We utilize an optimized clinical development framework, enhanced by proprietary data and analytics technology through our Prolaio platform, to drive efficient execution and accelerated proof-of-concept trial timelines. By applying our differentiated understanding of cardiovascular clinical endpoints and precision approach, focusing on indications with significant unmet need, we believe we are uniquely positioned to maximize our probability of clinical success and efficiently develop and deliver multiple novel medicines with meaningful therapeutic impact for patients and healthcare providers alike.

Cardiovascular disease is the leading cause of death worldwide, yet innovation has lagged due to drug development focused on broad, downstream, symptom-focused approaches despite disease heterogeneity and genetic variability. Furthermore, clinical trial design has depended on infrequent in-office measurements, failing to capture between-visit changes that are critical to understanding cardiovascular disease, including symptoms and variability over time. These factors often result in development requiring lengthy, large and expensive outcomes trials and therapies with modest treatment effects. Kardigan's approach is designed to address these challenges through differentiated clinical trial designs with near real-time patient data collection that enables more modern and efficient development, including reduced enrollment size and trial duration relative to traditional cardiovascular outcomes trials. The result is faster and more cost-effective trials designed to achieve a higher probability of success.

Our mission is to apply Kardigan's purpose-built cardiovascular development model to advance multiple late-stage programs in parallel, targeting "3 in 4"–three high-impact medicines through pivotal studies in roughly four years, subject to regulatory approval–enabling a credible, standalone and attractive value-creation path. By executing with discipline across our portfolio selection, development strategy, and trial execution, we aim to deliver better patient outcomes and build a durable, fully integrated, leading cardiovascular-focused biotechnology company.

**Our approach** 

We are reimagining cardiovascular drug discovery and development through an integrated approach that unites deep cardiovascular biological insights, high-density real-world patient data and advanced analytics to enable more precise, efficient and informed development of novel therapies. Our approach is built on four pillars, which are repeatable and underpin each program in our pipeline:

•  ***Target well-defined patient populations.*** We develop therapies specifically for biologically defined
subgroups rather than one-size-fits-all cardiovascular care.

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•  ***Target the root cause.*** We focus on the causal biological drivers to enable disease modification beyond
symptom relief based on deep mechanistic understanding and continuous learnings to guide program and portfolio decisions.

•  ***Harness technology.*** We leverage continuous real-world data, AI analytics and FDA-cleared algorithms to
increase power, speed and insight.

•  ***Develop differently.*** We use data-driven and insight-rich strategies and seek to gain early regulatory
alignment for novel functional and real-world endpoints. This approach enables selection of the right clinical trial endpoints in the right patient populations for the right indications, and may eventually support precision commercial models
specifically tailored to patients in identified responder segments. For each program, this process also unlocks substantial expansion potential across additional indications and patient populations.

***Cardiac intelligence – our proprietary toolkit for precision cardiovascular drug innovation.*** We believe that the next generation of cardiovascular innovation will be defined by the integration of precision therapeutics and high-fidelity data. To achieve this, we have pioneered "Cardiac Intelligence," a proprietary toolkit that enables our precision approach at scale by combining deep translational science with advanced technology infrastructure.

The foundation of this toolkit is Prolaio, our clinical intelligence platform of integrated medical insights and data analytics. By coupling Prolaio with our proprietary translational tools, including animal, cellular, metabolomic and proteomic models, we are able to identify the biological drivers of disease and execute clinical programs with a degree of precision and efficiency that we believe is unparalleled in cardiovascular medicine. We are actively deploying our Cardiac Intelligence toolkit across all stages of our pipeline, using its integrated data and analytics capabilities to accelerate target discovery, optimize clinical trial design and execution and inform precision commercialization strategies for our cardiovascular therapeutics.

***Our pipeline–3 in 4:*** We are currently advancing three late-stage cardiovascular therapies: Danicamtiv, for the treatment of genetic dilated cardiomyopathy ("DCM"); Ataciguat, which is aimed at slowing the progression of calcific aortic valve stenosis ("CAVS") in patients with moderate disease; and Tonlamarsen, for the management of blood pressure ("BP") in acute severe hypertension ("ASH") post-hospitalization.

***Our clinical pipeline***

![LOGO](g107928g11m01.jpg)

<u>Danicamtiv, targeting sarcomeric genetic causes of dilated cardiomyopathy</u>

Danicamtiv is an investigational novel, oral cardiac atrial and ventricular myosin activator designed to address the underlying sarcomeric defects that drive genetic DCM. DCM is a spectrum of heterogeneous disorders of the cardiac muscle that cause the heart chambers to remodel (i.e., thin, stretch, and dilate), leading to impaired ability to produce the cardiac output required to maintain normal body function. It is characterized by ventricular dilation and

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systolic dysfunction unexplained solely by abnormal loading conditions such as hypertension ("HTN"), primary valve disease, or coronary artery disease. DCM is the most common cardiomyopathy in adults, affecting up to between 150,000 and 200,000 U.S. patients with pathogenic MYH7 and TTN variants. The current standard of care for DCM is focused on treating downstream symptoms, such as heart failure, with guideline-directed medical therapy ("GDMT") that aims to manage symptoms, reduce hospitalizations, and delay the need for surgical intervention, including device implantation and heart transplant. There are no approved therapies indicated to treat DCM.

Danicamtiv was discovered and developed at MyoKardia and subsequently advanced by Bristol-Myers Squibb Company ("BMS Co.") before being in-licensed by us. It has been evaluated in 10 completed clinical studies, which provide a strong foundation as Kardigan advances Danicamtiv in a targeted DCM population designed to achieve a higher probability of success. Danicamtiv was specifically designed to target sarcomeric defects (i.e., impaired muscle contraction, force generation and movement of cardiac muscles) in DCM patients with primary abnormalities in the thick filament or cardiac myosin, including those pathogenic variants in the genes encoding myosin heavy chain 7 ("MYH7") and titin ("TTN"), the most common sarcomeric gene variants. This DCM pathology differs from the thin-filament and calcium-handling dysregulation thought to mediate general heart failure with reduced ejection fraction ("HFrEF") or other forms of DCM. With Danicamtiv, we are directly targeting the underlying pathology of thick-filament DCM by augmenting the enzymatic function and the availability of active myosin motors in order to improve force production and cardiac output.

In a two-part Phase 2a baseline-controlled, open-label clinical trial designed to assess the safety and preliminary efficacy of Danicamtiv in patients with primary DCM due to MYH7 variants or TTN truncating variants ("TTNtv") or primary DCM due to other causes, 41 patients received Danicamtiv twice daily for approximately two weeks. Danicamtiv was generally well-tolerated and was associated with improvements in left atrial and ventricular function in the MYH7 and TTNtv groups, as well as patients with DCM due to other causes. Of note, Danicamtiv's activity after two weeks of treatment was predictive of longer-term activity. The results were presented in a late-breaking oral session at the Heart Failure Society of America ("HFSA") Annual Scientific Meeting 2025 and simultaneously published in *The Journal of the American College of Cardiology* ("JACC").

In October 2025, we initiated KINSHIP-DCM, a Phase 2b/3 adaptive, randomized, placebo-controlled trial to assess the efficacy and safety of Danicamtiv in patients with genetic variants in MYH7 or TTN genes, as well as those with a family history of DCM or DCM variants in other genes. The trial is expected to enroll approximately 80 patients in the Phase 2b portion and approximately 250 patients in the Phase 3 portion*.* Our Prolaio technology is being employed for continuous patient data collection throughout the trial to generate insights that we believe will help inform this trial, and potentially future opportunities for Danicamtiv. ****We anticipate sharing data from the Phase 2b two-week Danicamtiv run-in in .

<u>Ataciguat, targeting valvular interstitial cells (VICs) in moderate CAVS to slow progression</u>

Ataciguat is an investigational oral, once-daily, soluble guanylate cyclase ("sGC") activator that aims to slow the deposition of aortic valve calcium ("AVC"), an underlying driver of disease progression in CAVS. There are currently no effective medical treatments to slow the progression of aortic valve calcification, and interventional aortic valve replacement remains the only available treatment for severe CAVS. Ataciguat originated from Sanofi S.A. ("Sanofi") and was further developed by the Mayo Clinic. It is supported by a deep data package, including 22 completed clinical studies, comprehensive safety and toxicology databases and manufacturing readiness. CAVS is the third most common cardiovascular disease after HTN and coronary artery disease, affecting 3.3 million patients in the United States alone, and is the most common acquired heart valve disease in developed countries, with a prevalence of approximately 3% of the U.S. population over 60 years of age. As the disease progresses, calcification stiffens the valve and reduces its area, progressively impairing function and increasing pressure on the left ventricle. This chronic overload promotes adverse remodeling and ultimately leads to decreased cardiopulmonary capacity and symptoms most often associated with heart failure.

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We believe that Ataciguat has the potential to be a first-in-disease therapeutic treatment starting with individuals with moderate CAVS, a progressive disease affecting approximately one million U.S. patients, where the standard of care is "watch and wait" monitoring until patients progress to severe disease and undergo surgical interventions to replace the valve. Ataciguat targets the VICs and slows osteogenic and calcific remodeling – the underlying driver of disease progression in CAVS. Patients with moderate to severe CAVS who experience disease progression have a poor prognosis if left untreated, with a five-year event-free survival of less than 40%. A Phase 2 trial showed that Ataciguat treatment blunted the progression of AVC in patients with moderate CAVS and led to improvements in measures of valvular compliance as well as cardiac function and structure, resulting in better cardiac output at six months without observed adverse effects on blood pressure that were experienced with other sGC activators. We believe these results point to the potentially differentiated mechanism of Ataciguat relative to other sGC stimulators and modulators and support the advancement of Ataciguat in patients with moderate CAVS.

In June 2025, we initiated KATALYST-AV, a two-part, adaptive, parallel-group, randomized, double-blind, placebo-controlled Phase 2b/3 clinical trial. This trial will evaluate the effect of Ataciguat on the progression of AVC in participants with moderate CAVS, will correlate the change in AVC with echocardiographic measures of cardiac structure and function, and will evaluate how changes in cardiac structure and function relate to symptoms through the assessment of cardiopulmonary exercise capacity by means of peak oxygen consumption ("VO<sub>2</sub>") We are deploying our Prolaio platform to enable home-based assessment of estimated VO<sub>2</sub> between clinic visits, supplementing in-clinic peak VO<sub>2 </sub>("pVO<sub>2</sub>") measurements by cardiopulmonary exercise testing ("CPET"). We anticipate that baseline data from Part A of KATALYST-AV will be available in , followed by the primary endpoint analysis measured by CPET in .

<u>Tonlamarsen, targeting hepatic angiotensinogen ("AGT") for post-hospitalization management of ASH</u> 

Tonlamarsen is an investigational liver-directed antisense oligonucleotide ("ASO") which targets hepatic AGT administered once-monthly via subcutaneous ("SC") injection. Kardigan is developing Tonlamarsen for the management of BP in ASH patients post-hospitalization. ASH is defined as a sudden elevation in blood pressure greater than or equal to 180/110 mmHg. Approximately six million ASH patients present in emergency rooms and about two million cases leading to hospitalization each year in the United States. Following hospital discharge, ASH patients are in a high-risk, vulnerable period, and often experience ongoing health challenges, including persistent HTN and continued risk of end-organ damage in the weeks and months after their hospitalization. During this critical period, ASH patients experience all-cause hospital readmission rates of approximately 18% at 30 days and 35% at 90 days, including readmission for heart failure and chronic kidney diseases, highlighting the urgency to lower BP and improve the transitions of care during this time. The estimated 1-year mortality rate for hospitalized ASH patients is 27%. There are currently no treatments indicated for the post-hospitalization management of BP in patients with ASH.

Tonlamarsen targets and down-modulates hepatic AGT, a key regulator of BP homeostasis, with a once-monthly ASO designed to enable generally well-tolerated, consistent and sustained BP management during the post-hospitalization transition period until a patient's condition can be managed with standard oral hypertensive therapeutics. Tonlamarsen offers the opportunity to controllably down-modulate hepatic AGT toward well-tolerated physiological levels during a defined treatment period, rather than prolonged silencing as seen with RNA interference ("RNAi") approaches. This eliminates the need for a reversal agent and may potentially break a compensatory cycle in which AGT reduction triggers increased production elsewhere in the body. Tonlamarsen was in-licensed from Ionis Pharmaceuticals, Inc. ("Ionis") and is supported by a robust data package including completed Phase 1 and 2 clinical studies, as well as comprehensive safety and toxicology data. When we in-licensed Tonlamarsen, we intended to develop it in a patient population of high unmet need such as ASH, where we believe the underlying driver of HTN is AGT. We believe that targeting post-hospitalization management of BP in patients with ASH can offer significant benefits for patients, including the potential to reduce risk of recurrent ASH and rehospitalization, particularly for those with poor adherence or physiological

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resistance to daily medications. Furthermore, the ASH patient population has generally been excluded from studies of HTN, while other AGT-targeted therapies have never been studied in ASH patients. We therefore conducted a study evaluating Tonlamarsen in uncontrolled HTN patients, deploying our Prolaio platform to better characterize its activity before initiating our development in ASH patients.

Our KARDINAL Phase 2 trial was a randomized, double-blind, placebo-controlled, parallel-group study in adult participants with uncontrolled HTN on two or more antihypertensive medications that have not achieved their target BP. In this trial, Tonlamarsen demonstrated a statistically significant mean reduction in percent plasma AGT levels and a clinically meaningful mean reduction in in-office systolic blood pressure ("oSBP") across both randomized groups from baseline to Week 20. Notably, participants with the highest hypertensive burden (oSBP >150 mmHg at baseline) experienced the greatest mean reductions in oSBP. ASH is characterized by BP surges that drive recurrent hospitalizations and risk of end-organ damage. Importantly, Tonlamarsen resulted in greater and more sustained reductions in home systolic blood pressure ("hSBP") surges <u>></u>150 mmHg by 28%. These data, combined with the insights from our Prolaio platform, enabled us to determine that there was a strong clinical rationale for evaluating Tonlamarsen in patients with ASH. ****The KARDINAL trial utilized our Prolaio platform for home-based, high-density BP and ECG data collection, supporting objective assessment of BP management and heart failure parameters. We are currently evaluating Tonlamarsen in the setting of post-hospitalization management of BP in patients with ASH, and believe this therapeutic approach on top of current standard-of-care could offer significant and unique benefits, including the potential to reduce risk of recurrent ASH and rehospitalization. While many patients who develop ASH have uncontrolled chronic hypertension, the specific near-term risk to ASH patients is distinct and requires study as a separate disease condition. In , we plan to initiate a Phase 2 randomized, blinded, placebo-controlled, multicenter trial, KARDINAL-ASH, to confirm the safety and efficacy of Tonlamarsen in approximately 100 ASH patients. We expect to report data from KARDINAL-ASH in .

***Other clinical and discovery stage programs***

In addition to our late-stage clinical candidates, we are advancing KAR-141 and several discovery-stage therapeutic candidates designed to address the underlying drivers of cardiovascular diseases. KAR-141, in-licensed from BMS Co., is an investigational oral, once-daily, protease-activated receptor 4 ("PAR4") antagonist. PAR4 is a G-protein-coupled receptor ("GPCR") expressed on human platelets that contributes to platelet activation and thrombus propagation. Our discovery efforts focus on indications where we believe our expertise and technologies may enable the identification and development of novel therapies where no treatments exist. We intend to prioritize programs that complement our existing portfolio and leverage our capabilities in cardiovascular disease.

***Prolaio***

A core component of our Cardiac Intelligence approach is our Prolaio technology platform, acquired by Kardigan in 2025. Prolaio is a differentiated clinical intelligence platform with integrated medical insights and data analytics designed to improve the efficiency and, quality and increase the probability of success of cardiovascular clinical development. By integrating third-party clinical-grade wearable sensors, a patient-friendly user interface, and proprietary, FDA-cleared AI-based algorithms, Prolaio enables continuous, real-world physiologic data collection, and customized patient-reported outcome information. These data are compiled and analyzed across our clinical programs, providing deeper insight into treatment effects than traditional, less-frequent clinic-based assessment models. Prolaio is currently integrated across each of our clinical trials and utilized by all participating patients. Upon enrollment, a comprehensive Prolaio kit is delivered directly to the patient's home, providing all necessary Bluetooth-enabled hardware to capture key cardiovascular metrics, such as heart rate, respiration rate, heart rate variability, atrial fibrillation, activity, and

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blood pressure, without a site visit. Through a tailored mobile interface, patients then manage their specific protocols, complete tasks, and record electronic patient-reported outcomes ("ePROs"), promoting high compliance and engagement while maintaining their normal routines.

**<u>Our Prolaio platform</u>**

![LOGO](g107928g09v09.jpg)

To date, Prolaio holds over four million hours of continuous physiologic data with underlying technology that has been deployed in Kardigan and third-party clinical trials across more than 22 countries. The Prolaio ecosystem is supported by over 20 issued patents and seven FDA-cleared algorithms for the measurement of certain vital signs and other key cardiovascular parameters. This foundation allows us to deploy Prolaio broadly across our pipeline with confidence in data quality and reproducibility. Building on its established capabilities today, we believe Prolaio is positioned to define and enable the design, execution, and optimization of modern clinical development for precision cardiology.

**Founding members, management team and investors** 

Our team is led by biopharma veterans with a proven track record in cardiovascular drug discovery and development.

We were co-founded in 2023 by our Chief Executive Officer, Tassos Gianakakos, our Chief Medical Officer, Jay Edelberg, M.D., Ph.D., our Chief Scientific Advisor, Bob McDowell, Ph.D., Leslie Leinwand, Ph.D., Beth McNally, M.D., Ph.D. Dr. Edelberg and Dr. Leinwand were founders of MyoKardia. Mr. Gianakakos, Dr. Edelberg and Dr. McDowell were executives at MyoKardia through the time MyoKardia was acquired by BMS Co. for $13.1 billion in October 2020. At MyoKardia, Mr. Gianakakos, Dr. Edelberg and Dr. McDowell were integral in mavacamten's clinical development for obstructive hypertrophic cardiomyopathy and executing registrational clinical trials with which BMS Co. filed a New Drug Application ("NDA") and received FDA approval in April 2022. They also conducted initial development work on Danicamtiv together at MyoKardia, which was licensed back from BMS Co. following the acquisition.

• Tassos Gianakakos, Co-Founder, President and Chief Executive Officer, is a highly
experienced drug discovery and development executive and entrepreneur who has more than 20 years of experience in the biopharmaceutical industry. Mr. Gianakakos served as Chief Executive Officer of MyoKardia prior to its acquisition by BMS Co.
in 2020. He also co-founded Prolaio, which Kardigan acquired in 2025. He has played an instrumental role in the start-up of multiple biotechnology companies.

• Jay Edelberg, M.D., Ph.D., Co-Founder and Chief Medical Officer, is a clinical
cardiologist and vascular biologist with more than twenty years of leadership and experience in cardiovascular clinical research and

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drug discovery and development. Dr. Edelberg served as Chief Medical Officer of MyoKardia prior to its acquisition by BMS Co.in 2020. He also co-founded Prolaio, which Kardigan acquired in 2025. He served in senior leadership roles at a number of biopharma companies including Sanofi, BMS Co. and GlaxoSmithKline. <br>

• Bob McDowell, Ph.D., Co-Founder and Chief Scientific Advisor, is an accomplished
scientist with expertise in small molecule drug discovery in cardiovascular disease and was a key member of the founding team of MyoKardia in 2012 and served as its Chief Scientific Officer at the time of BMS Co.'s acquisition. He has served
in senior scientific leadership roles at a number of biopharma companies including 3-V Biosciences, Sunesis Pharmaceuticals and Axys Pharmaceuticals.

• Leslie Leinwand, Ph.D., Co-Founder, is a Distinguished Professor of Molecular,
Cellular and Developmental Biology and the Chief Scientific Officer of the BioFrontiers Institute at the University of Colorado Boulder. Her research lab focuses on the genetics and molecular physiology of inherited diseases of the heart and
particularly how biological sex affects the heart in health and disease. She co-founded Myogen, Inc. (acquired by Gilead Pharmaceuticals), Hiberna, Inc. and MyoKardia.

• Beth McNally, M.D., Ph.D., Co-Founder is the Elizabeth J. Ward Professor of Genetic
Medicine at Northwestern University Feinberg School of Medicine, where she directs the Center for Genetic Medicine. A cardiologist and geneticist who is advancing the use of genetics in cardiovascular healthcare, Dr. McNally has been a leader
in defining and using genetic signals to drive drug discovery and development.

We have built an established team of highly experienced drug developers, with significant depth of knowledge in cardiovascular disease.

Our senior leadership team includes:

• Andy Pasternak, Chief Strategy Officer, a biopharmaceutical executive with more than two decades of leadership across
corporate strategy, business development, portfolio management and commercial development. Previously, he served as Executive Vice President and Chief Strategy Officer at Horizon Therapeutics, where he led a series of transactions and the growth of
its innovative medicines pipeline and portfolio.

• Brianne Puglisi, Chief Financial Officer, with over 18 years of experience in strategic finance and private and public
company operations. She previously served as Chief Business Officer for LianBio and was the Senior Vice President of Finance and Strategic Operations at Kadmon. She has also held a senior-level position at KPMG.

We are supported by leading life science investors with significant industry experience and expertise including ARCH Venture Partners, Fidelity Investments, HRTG Partners, Perceptive Advisors, and T. Rowe Price. Prospective investors should not rely on the past investment decisions of our investors, as our investors may have different risk tolerances and have received their shares in prior offerings at prices lower than the price offered to the public in this offering.

**Our mission and strategy** 

Our mission is to advance novel medicines that modify the root causes of cardiovascular disease, moving the field beyond symptom management toward functional cures. We employ an optimized clinical development framework along with proprietary data and analytics technologies to support efficient and disciplined trial execution. We are executing this approach through the following strategies:

•  ***Advance Danicamtiv for genetic DCM*** : We believe Danicamtiv has the potential to address a significant
unmet need in genetic DCM by targeting sarcomeric defects, a key driver of disease progression, in a setting

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where there are no disease-modifying therapies approved. Danicamtiv has demonstrated therapeutic potential in a Phase 2a trial in genetic DCM and is currently being evaluated in KINSHIP-DCM, a Phase 2b/3 trial. Our Prolaio technology will be employed for continuous patient data collection throughout the trial to generate exploratory insights that will help inform this trial, and potentially future opportunities for Danicamtiv. We anticipate sharing interim data from the KINSHIP-DCM Phase 2b two-week Danicamtiv run-in period in . <br>

•  ***Advance Ataciguat for moderate CAVS:*** We are developing Ataciguat as a potential first-in-disease therapy for moderate CAVS, a program we believe has the potential to slow disease progression to severe forms of the disease which may eventually lead to
valve replacement. Ataciguat has demonstrated the potential to slow the underlying calcification process driving aortic stenosis without adverse effects on BP, and is currently being evaluated in KATALYST-AV, a Phase 2b/3 trial. We are using our Prolaio technology to evaluate VO<sub>2</sub> between clinic visits as an exploratory measure, supplementing in-clinic pVO<sub>2</sub> measurements by CPET.<sub> </sub>Baseline data from Part A of KATALYST-AV are expected
in    , followed by the primary endpoint analysis in    .

•  ***Advance Tonlamarsen for post-hospitalization management of ASH:*** We are developing Tonlamarsen as the
potential first therapy specifically for the post-hospitalization management of BP in patients with ASH. In the KARDINAL Phase 2 trial in uncontrolled HTN, Tonlamarsen demonstrated statistically significant mean reductions in AGT and clinically
meaningful reductions in oSBP from baseline, supporting the clinical rationale for evaluating Tonlamarsen in ASH. Tonlamarsen is currently being developed in KARDINAL-ASH, a Phase 2 trial, where we are
deploying our Prolaio platform with the Corsano wrist-worn biosensor for continuous home-based BP and ECG data collection during the post-discharge period to characterize BP and other cardiovascular parameters. We expect to report results from KARDINAL-ASH in    .

•  ***Harness our Cardiac Intelligence toolkit to accelerate the development of transformative medicines.*** We
couple Prolaio, our clinical intelligence platform with integrated medical insights and data analytics, with proprietary tools and deep cardiovascular expertise to identify and advance high-potential drug candidates. These capabilities allow us to
detect treatment signals earlier, make faster development decisions across our pipeline and deepen our understanding of cardiovascular disease mechanisms. We believe this approach will enable more efficient clinical trials with fewer participants at
a lower cost relative to traditional cardiovascular drug development.

•  ***Expand our cardiovascular pipeline through internal innovation and selective external collaborations:*** In addition to our late-stage clinical candidates, we are advancing KAR-141 and several discovery-stage programs focused on key drivers of cardiovascular disease. We plan to
continue expanding our pipeline through internal discovery as well as selective licensing and collaboration opportunities.

**Danicamtiv: Our cardiac myosin activator for sarcomeric genetic DCM** 

***Overview***

Danicamtiv is an investigational novel, oral cardiac atrial and ventricular myosin activator designed to address the underlying sarcomeric defects that drive genetic DCM by specifically targeting abnormalities in the thick filament of the sarcomere, the fundamental unit of cardiac muscle contractility, and by restoring myosin function and availability. Unlike current standard of care therapies, which primarily target downstream symptoms such as heart failure, Danicamtiv is being developed for patients with genetic DCM caused by variants in key sarcomeric genes, including the two most prevalent, MYH7 and TTN. This myosin-centric DCM pathology differs from the thin-filament and calcium-handling dysregulation thought to mediate general HFrEF or other forms of DCM. With Danicamtiv, we are directly targeting the underlying pathology in order to improve force production and cardiac output.

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Danicamtiv was discovered by MyoKardia as a true myosin motor function enhancer and was then subsequently advanced by BMS Co. Kardigan in-licensed exclusive worldwide development and commercialization rights to Danicamtiv in November 2024. Danicamtiv has been evaluated in 10 completed clinical studies, which provide a strong foundation as Kardigan advances it in a targeted DCM population designed to achieve a higher probability of success. In August 2020, MyoKardia initiated a Phase 2a trial of Danicamtiv in primary DCM, including 26 patients with MYH7 variants and TTNtv. BMS Co. acquired MyoKardia in October 2020 and continued to run the trial until November 2023, when it discontinued development due to strategic business considerations. The Phase 2a clinical trial was a two-part multi-center, baseline-controlled, open-label clinical trial designed to assess the safety and preliminary efficacy of Danicamtiv in patients with primary DCM due to MYH7 or TTNtv variants, or primary DCM due to other causes.

Following its in-licensing of Danicamtiv in 2024, we presented topline results from Part A of the trial, which enrolled 41 participants who received Danicamtiv for approximately two weeks, in a late-breaking oral session at the HFSA Annual Scientific Meeting 2025 and simultaneously published in JACC. Danicamtiv was generally well-tolerated and was associated with improvements in left atrial and ventricular function in groups with genetic DCM driven by MYH7 and TTNtv sarcomeric variants, as well as those with primary DCM caused by other genetic variants or unknown causes. Responses measured by echocardiography were consistent with a Danicamtiv-induced enhancement of myosin function and availability, and participants with DCM caused by MYH7 or TTNtv variants had the most favorable overall responses in both left atrial and ventricular function. These positive effects were observed without exposure-driven elevations in cardiac troponin generally seen in other non-myosin centric disease states. Of note, Danicamtiv's activity after two weeks of treatment was predictive of longer-term activity. Part B of the trial was designed as an open-label extension with treatment planned for 96 weeks and was intended to evaluate the long-term preliminary safety and tolerability of treatment with Danicamtiv as well as the timeline and durability of effects of Danicamtiv on cardiac structure and function in participants with DCM driven by MYH7 or TTNtv variants or DCM of other causalities. Due to the COVID-19 pandemic and challenges with drug supply, only 19 participants who completed Part A enrolled into Part B, with a median gap in exposure between the end of Part A and start of Part B of 226 days (range of 29-660 days). The overall median treatment duration was 289 days (range of 21-499 days). Despite these limitations, extended Danicamtiv treatment was generally well-tolerated and resulted in directionally similar improvements in echocardiographic measures of cardiac function from baseline to Week 2 in both Part A and Part B, with sustained or further improvement at Week 12 in Part B, although changes were not sustained after Week 24 due to limited data from a small number of participants (2-3 per dose level) in each of the MYH7 and the TTN cohorts. We believe the results from the Phase 2a trial, along with Danicamtiv trials in healthy volunteers and in patients with HFrEF, support further advancement of Danicamtiv for the treatment of DCM patients with variants in MYH7 or TTN genes.

In October 2025, we initiated KINSHIP-DCM, a Phase 2b/3 adaptive, randomized, placebo-controlled trial to assess the efficacy and safety of Danicamtiv in patients with genetic variants in MYH7 or TTN genes, as well as those with a family history of DCM or DCM variants in other genes. We anticipate sharing interim data from the KINSHIP-DCM Phase 2b two-week Danicamtiv run-in period in .

***Dilated cardiomyopathy (DCM)***

DCM, the most common cardiomyopathy in adults, is a spectrum of heterogeneous disorders of the cardiac muscle that cause the heart chambers to remodel (i.e., thin, stretch and dilate), leading to impaired ability to produce the cardiac output required to maintain normal body function. It is characterized by ventricular dilation and systolic dysfunction unexplained solely by abnormal loading conditions such as HTN, primary valve disease, or coronary artery disease. Individuals with DCM are at significant risk of disease progression which represents a major cause of heart failure and other serious complications, including arrhythmia. The current

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standard of care focuses on the treatment of heart failure, with GDMT that aims to manage symptoms, reduce hospitalizations and delay the need for surgical intervention, including device implantation and heart transplant.

In the United States, the estimated prevalence of overall DCM is over one million. Five-year mortality is high, with recent studies reporting mortality rates between 22% and 56%. DCM is classified as either primary or secondary. If DCM is not found to be due to acquired etiologies, it is considered primary DCM, with this group consisting of patients whose DCM is due to genetic causes and those whose disease is of unknown cause. Primary DCM is predominantly inherited, accounting for approximately 35-40% of all DCM cases, or more than approximately between 400,000 and 500,000 individuals in the U.S. Variants in more than 250 genes have been associated with primary DCM, resulting in a wide range of DCM clinical manifestations and outcomes. A significant proportion of genetic DCM arises from variants in sarcomeric genes, most commonly those encoding the thick-filament proteins MYH7 and TTN. Variants in MYH7 and TTN can disrupt myosin motor function by impairing intrinsic enzymatic and contractile activity or by reducing recruitment of working myosin motors. Myosin-centric primary DCM pathology differs from secondary thin-filament and calcium-handling dysregulation thought to mediate general HFrEF or other forms of DCM, in which myosin availability/function is likely unchanged. We estimate the combined prevalence of primary DCM associated with pathogenic or likely pathogenic MYH7 and TTN gene variants which may be addressed by Danicamtiv to be up to between 150,000 and 200,000 individuals in the United States.

**<u>Danicamtiv patient population</u>**

![LOGO](g107928g01a05.jpg)

There are currently no approved therapies that specifically target the underlying etiologies of DCM, and a significant unmet need exists for treatment of genetic primary DCM with a precision medicine approach. Standard of care for DCM patients, regardless of sub-type, is treatment with GDMT for HFrEF, a one-size-fits-all approach to the symptomatic downstream consequences of DCM and other etiologies such as chronic hypertension and coronary artery disease. There are other clinical-stage therapeutic candidates which have been developed in DCM, along with other indications such as HFrEF. However, these were associated with over-activation of myosin, and a greater reduction of myocardial relaxation that limited their therapeutic window for treatment of DCM. If approved, Danicamtiv has the potential to be the first precision treatment for genetic DCM.

***Our solution—Danicamtiv***

Danicamtiv is an investigational novel, oral cardiac atrial and ventricular myosin activator specifically designed to selectively target the underlying thick filament abnormalities of primary DCM caused by TTN and MYH7 sarcomeric genetic variants. Cardiac muscle fibers are comprised of sarcomeres, the fundamental unit of cardiac muscle contractility. Sarcomeres are highly organized structures of thick and thin filaments that work in unison to produce force. Cardiac myosin is the principal component of the thick filament and serves as the

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motor unit of the sarcomere. In many individuals with genetic DCM, these myosin motors are reduced in number or functionally impaired. Variants in MYH7 and TTN can disrupt myosin's intrinsic enzymatic and contractile activity or limit the recruitment of functional myosin motors during contraction. With Danicamtiv, we are directly targeting the underlying pathology of thick-filament DCM by augmenting the enzymatic function and the availability of active myosin motors in order to improve force production and cardiac output. Cardiac muscles contract through the sliding filament model, where cyclical, tightly coordinated interactions between myosin and actin shorten the sarcomere. A muscle contraction begins when myosin motors in an "ON" state bind to actin protein that forms thin filaments and provides structural framework and binding sites for myosin, forming a force-generating cross-bridge. The shortening of the sarcomere is driven by the swinging of the myosin molecules as they enzymatically cycle, causing the thin filament to slide over the thick filament. Myosin then detaches from the cross-bridge, ending the contraction and returning myosin to its original "ON" available state, relaxing the cardiac muscle and readying it for the next contraction-relaxation cycle. In the normal sarcomere, a portion of the working cardiac myosin motors participate in contraction/relaxation in a force-generating "ON" state while the rest remain in a reserve "OFF" state and are available for recruitment. In DCM driven by MYH7 and TTN variants, direct myosin motor dysfunction and impaired recruitment of myosin motors from the reserve "OFF" state results in an insufficient number of force-generating- "ON" myosin motors, limiting effective myosin–actin cross-bridge-formation and contractile function.

In preclinical studies Danicamtiv selectively bound to and allosterically enhanced the enzymatic activity of cardiac myosin motors as well as increased the population of working myosin motors that can form cross-bridges during contraction, shifting myosin motors from the "OFF" to the "ON" state. Danicamtiv has been shown to act on both alpha myosin, which is predominant in healthy atria, and beta myosin, which is predominant in ventricles or diseased atria. In clinical studies, Danicamtiv enhanced both left atrial and left ventricular ("LV") function. Increased proportions of working myosin motors can drive the formation of higher numbers of force-generating actomyosin cross-bridges, enabling previously non-working or resting myosins to participate in the heart contraction and increase contraction force, restoring sarcomere function in DCM.

**<u>Danicamtiv impact on myosin function</u>**

![LOGO](g107928g10v10.jpg)

Importantly, the additional actomyosin cross-bridges induced by Danicamtiv did not biochemically alter calcium handling or calcium-regulated dynamics of the thin filament and have minimal effects on myosin ADP release at therapeutic doses, which is essential for typical cross-bridge detachment and thus ventricular relaxation. As a result, Danicamtiv increased force generation of contractions and increased calcium ion sensitivity in both atrial and ventricular fibers, particularly in the setting of dysfunctional myosin motors like those found in MYH7 and

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TTN variants. In preclinical studies, Danicamtiv activated myosin directly with no observed effects on calcium levels inside heart cells or filling pressures, suggesting that Danicamtiv may have the potential to improve the overall cardiac performance of patients with these genetic subtypes while having minimal or no effect on ventricular relaxation and potentially posing lower arrhythmia risk than traditional inotropes.

***Clinical data***

To date, Danicamtiv has been evaluated in 10 completed clinical studies, including the Phase 2a trial in genetic DCM initiated by MyoKardia. A total of 265 participants have received at least one dose of Danicamtiv, with participants receiving single doses up to 550 mg and repeated doses of five to 75 mg twice daily ("BID") for up to 71 weeks. Studies conducted prior to the Phase 2a DCM trial include assessment of pharmacokinetics ("PK") in the fed versus fasted state in patients with renal impairment, in Japanese vs. Caucasian healthy volunteers, in healthy volunteers treated with Danicamtiv in the presence of CYP3A4 inhibitors and substrate and in patients with stable HFrEF. Additionally, two formulations of Danicamtiv have been studied in healthy volunteers to compare PK.

A two-part trial was conducted in HFrEF patients by MyoKardia, comprising a Phase 1b single ascending dose ("SAD") portion with 12 patients, followed by a Phase 2 multiple ascending dose ("MAD") trial with 40 patients. Danicamtiv treatment demonstrated favorable effects on LV systolic performance, atrial function and echocardiographic markers of filling and stroke volume. However, a transient and asymptomatic increase in troponin was observed in some participants treated with Danicamtiv while no increase was observed in the placebo group. While the clinical significance of these elevations remains unclear, we hypothesize that Danicamtiv-mediated myosin recruitment in the setting of underlying normal myosin availability of HFrEF creates a scenario similar to the case of hypertrophic cardiomyopathy ("HCM"), where excess myosin availability leads to leaks in cardiac troponin (currently treated/corrected with cardiac myosin inhibitors). As such, it was not surprising that HFrEF patients exhibiting increased troponin showed limited structural and functional improvements when treated with Danicamtiv, and, as a corollary, that troponin leaks were not noted in patients with myosin-centric DCM.

Danicamtiv was generally well-tolerated across all clinical trials described in the table below, with few serious adverse events ("SAEs") or treatment-emergent adverse events ("TEAEs") leading to treatment withdrawal and no unexpected life-threatening or fatal events. Additionally, experience to date in both healthy participants and those with heart failure has shown that Danicamtiv improved LV systolic function without discernible impact on diastolic function when not at high doses.

**<u>Early-stage clinical development studies of Danicamtiv</u>**

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| | | | |
|:---|:---|:---|:---|
| **Trial ID** | **Phase** | **Subjects (Dani/Total)** | **Design** |
|  MVK-491 001 | 1 | 48/64 | First-in-Human study in healthy volunteers |
|  MVK-491 003 | 1b/2a | 12/12 (SAD)<br> 30/40 (MAD) | Placebo-controlled SAD/MAD trial in stable HFrEF patients |
|  MVK-491 005 | 1 | 11/11 | Open-label food effect trial in healthy volunteers |
|  MVK-491 101 / CV028003 | 1 | 16/16 | Open-label renal impairment trial in patients with severe renal impairment and healthy controls |
|  MVK-491 102 / CV028004 | 1 | 24/24 | Open-label high- and low-fat meal PK trial in healthy volunteers |

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| | | | |
|:---|:---|:---|:---|
| **Trial ID** | **Phase** | **Subjects (Dani/Total)** | **Design** |
|  CV028008 | 1 | 30/30 | Open-label single-dose co-administration trial (itraconazole or diltiazem) in healthy volunteers |
|  CV028009 | 1 | 13/13 | Open-label DDI trial (midazolam) in stable HFrEF patients |
|  CV0281001 | 1 | 24/33 | Placebo-controlled SAD trial in healthy Japanese and Caucasian volunteers |
|  CV0281012 | 1 | 59/59 | Open-label trial of two formulations of Danicamtiv |

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**<u>Phase 2a genetic DCM trial</u>** 

In August 2020, MyoKardia initiated a two-part Phase 2 multicenter, baseline-controlled, open-label clinical trial of Danicamtiv. Part A evaluated the safety and preliminary efficacy in participants with DCM over approximately a two-week sequential dosing period. The trial enrolled 41 participants with DCM due to TTNtv or MYH7 genetic variants or other causes.

Eligible participants were clinically stable, ambulatory adults with DCM defined by New York Heart Association ("NYHA") functional class I to IV and a left ventricular ejection fraction ("LVEF") ≤45%, with no significant coronary artery disease or primary valvular disease. Participants could not have HFrEF considered by the investigator to be primarily caused by ischemic heart disease, chronic valvulopathy or another condition. Participants were required to be on stable, GDMT for at least two weeks prior to screening. Participants in the MYH7 and TTNtv cohorts were required to have a diagnosis of DCM attributed to a pathogenic or likely pathogenic variant in MYH7 or TTNtv and participants in the other causes cohort required confirmation that DCM was either genetic testing negative or due to pathogenic variants in genes other than MYH7 or TTNtv.

Patients received oral Danicamtiv 25 mg twice daily in the first treatment period. Dose was adjusted in the second treatment period to either 10 mg or 50 mg twice daily based on whether systolic ejection time determined by echocardiogram at the end of treatment period 1 was >50 ms or ≤50 ms, respectively.

**<u>Danicamtiv Phase 2a trial</u>**

![LOGO](g107928g81f22.jpg)

Topline results from Part A, presented in a late-breaking oral session at the HFSA Annual Scientific Meeting 2025 and simultaneously published in JACC, demonstrated that Danicamtiv was generally well-tolerated and that the two-week treatment was associated with improvements in left atrial and ventricular function in patients with genetic DCM driven by MYH7 and TTNtv sarcomeric variants. Of note, Danicamtiv's activity after two weeks of treatment was predictive of longer-term activity.

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Clinical safety and tolerability of Danicamtiv was the primary outcome measure, assessed by the frequency of adverse events ("AEs"), serious AEs and clinically significant abnormalities from vital signs, physical examination, electrocardiogram recordings and laboratory measurements including troponin. Treatment-emergent AEs were defined as AEs occurring during the period from the first dose of Danicamtiv to 14 days after the last dose and those with an onset before the first Danicamtiv dose that increased in severity or became serious during the treatment-emergent period. Danicamtiv was generally well-tolerated and no drug-related AEs leading to discontinuation, serious AEs, death or severe treatment-emergent AEs were reported during the study period. TEAEs were reported in 22 (53.7%) of 41 participants, all considered to be mild or moderate with one discontinuation. An asymptomatic increase in troponin was detected in three participants in the other causes cohort.

Secondary endpoints were changes from baseline in cardiac echocardiography parameters as determined by transthoracic echocardiogram ("TTE"). TTE assessments included LV systolic ejection time, systolic function (including LVEF and left ventricular global longitudinal strain ("LVGLS")), LV dimensions, left atrial volume and function and LV diastolic function. In patients with DCM primarily due to TTNtv and MYH7 variants, Danicamtiv resulted in improvements in both atrial and ventricular function. Responses measured by echocardiography were consistent with a Danicamtiv-induced enhancement of myosin function/availability and participants with DCM caused by MYH7 or TTNtv variants had the most favorable overall responses in both left atrial and ventricular function.

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**<u>Danicamtiv Phase 2a trial results</u>**

![LOGO](g107928g09u05.jpg)

\*P < 0.05, \*\*P<0.01; TP = treatment period; BID = twice daily

Danicamtiv demonstrated an absolute mean change from baseline in LVEF at the end of treatment period 2 of 8.8% (p=0.001), 5.9% (p=0.005) and 4.4% (not statistically significant ("NS")) in the MYH7 cohort (n=12), TTNtv cohort (n=14) and DCM of other causes cohort (n=15), respectively. Absolute mean change from baseline in left atrial function index ("LAFI") in period 2 was 11.1 (p=0.006), 6.8 (NS) and 4.4 (p=0.026) in the MYH7 cohort, TTNtv cohort and other causes cohort, respectively. Danicamtiv demonstrated an absolute mean change from baseline at the end of treatment period 2 in LVGLS of -2.1% (p=0.008), -1.2% (NS) and -1.4% (NS) in the MYH7 cohort, TTNtv cohort and other causes cohort, respectively. Importantly, the systolic gains occurred without adverse impact on diastolic parameters, including filling pressure.

Following Danicamtiv treatment, an asymptomatic increase in cardiac troponin without any clinical signs of ischemia was detected only in three participants in the other causes cohort. Notably, participants with DCM

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harboring MYH7 and TTNtv variants, which are expected to have a reduced number of force-generating myosin motors-based on the literature, showed no significant troponin response to direct myosin enhancement with Danicamtiv despite improvements in cardiac performance, consistent with increases in the number of working myosin motors. These findings, together with the above-noted evidence of troponin increases in patients with HFrEF treated with Danicamtiv—suggesting that increasing myosin motors is not beneficial—reinforce our hypothesis that Danicamtiv is most appropriately targeted to patients with MYH7 and TTNtv sarcomeric variants, whose pathophysiology is myosin-centric.

After completion of Part A of the trial, participants were able to enroll in the Part B open label extension portion of the trial. Part B was intended to evaluate the safety and duration of treatment effect following Danicamtiv re-exposure for up to 96 weeks. However, the trial was terminated early by BMS Co. for business reasons, limiting the number of participants and treatment duration. Nevertheless, the trial demonstrated that extended Danicamtiv treatment was generally well-tolerated and associated with improved left atrial and ventricular function.

In Part B, 19 participants received Danicamtiv doses of 25, 50 or 75 mg BID. The median gap in exposure between end of Part A and start of Part B was 226 days (range of 29-660 days), and overall median treatment duration was 289 days (range of 21-499 days). Two participants on the highest dose discontinued treatment and the trial due to AEs of increased liver enzymes and liver injury. Five participants (26.3%) reported serious AEs. In one participant, SAEs of liver injury and acute kidney injury were considered drug-related by the investigator. All serious AEs were resolved by the time of database lock, and no deaths were reported during the trial. Over this extended period, two participants had asymptomatic, transient increases in standard troponin I (>2X upper limit of normal ("ULN")); one participant at Day 80 and the second participant at Day 84 and Day 127). None of these increases were associated with clinical signs of cardiac ischemia nor led to treatment discontinuation.

Re-exposure to Danicamtiv during Part B was associated with directionally similar improvements in echocardiographic measures of cardiac function (LAFI, LVEF, LVGLS) from baseline to week 2 as were seen in Part A. Early (2 weeks) improvements in cardiac function correlated with late (12 weeks) improvements.

**<u>Non-clinical studies</u>** 

Non-clinical studies demonstrated that Danicamtiv increased, towards normal, systolic production in myocardial fibers from animals with either genetic (mice carrying a pathogenic DCM myosin variant) or induced (pharmacological myosin inhibitors) myosin dysfunction. In the setting of myosin-inhibition mimicking MYH7 DCM mutations, Danicamtiv restored function both biochemically and biomechanically, restoring enzymatic activity of myofibrils and restoring systolic tension in skinned isolated fibers, resulting in the restoration of cardiac function and cardiac output production in vivo in both rats and pigs. These in vivo effects were noted in the setting of preserved diastolic function and in filling pressures in both rats and pigs.

In addition, Danicamtiv increased myosin-head recruitment in vitro resulting in enhanced length-dependent activation underlying the Frank-Starling law (i.e., greater force at greater stretch), while preserving resting tensions/diastolic indices.

Additional nonclinical studies, including safety pharmacology, genotoxicity and repeat-dose toxicity studies including reproductive toxicity have been completed to evaluate the potential toxicologic profile of Danicamtiv. Nonclinical studies conducted to date have demonstrated that Danicamtiv's pharmacological effects were dose-dependent and reversible. Major findings from the good laboratory practice ("GLP") toxicology studies were consistent with dose-dependent, exaggerated on-target pharmacological effects, i.e., dose-limiting toxicity manifested by myocardial necrosis/fibrosis, with secondary changes in the lung or liver of some animals that died, reflecting decreased cardiac function. Observations not related to the on-target effects, such as increased

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platelet counts in male rats and lower body weight gains for female rats, were minimal and not considered adverse. We believe the scope of the toxicologic evaluation for Danicamtiv supports its continued use in human clinical studies.

***Clinical development plan***

In October 2025, we initiated KINSHIP-DCM, a Phase 2b/3 adaptive, randomized, placebo-controlled trial to assess the efficacy and safety of Danicamtiv in people with genetic and familial DCM. The trial is designed to enroll DCM patients with genetic variants in MYH7 or TTN genes, as well as those with a family history of DCM or DCM variants in other genes.

The purpose of the trial is to replicate and extend the findings of the Phase 2a trial. Specifically, the trial is designed to determine whether improvements observed on echo parameters translate into improvements in cardiopulmonary function to assess whether benefit extends beyond TTN- and MYH7-variant-DCM to other etiologies, and to identify characteristics that differentiate responders from non-responders.

Approximately 80 participants are expected to be enrolled in the Phase 2b (Part 1) of the trial, which includes two single-blind run-in periods. The first run-in will be with placebo for two weeks, followed by Danicamtiv administration for two weeks. Participants will then be randomized to either placebo or Danicamtiv (1:1) for the blinded portion of the trial for 24 weeks.

In the Phase 3 (Part 2) of the trial, approximately 250 participants are expected to be randomized to either Danicamtiv or placebo treatment (2:1, respectively) in the blinded portion of the trial and treated for 24 weeks. The trial will separate two cohorts of patients: 1) DCM participants with known MYH7 or TTN variants, and 2) DCM participants with non-MYH7/TTN variants or a family history of DCM. In the Phase 2b (Part 1), LAFI will be the primary endpoint, while in the Phase 3 (Part 2), pVO<sub>2</sub> will be the primary endpoint, which is based on CPET measurements*.* ****Measurement of pVO<sub>2</sub> will serve as the registrational endpoint and is expected to reflect the potential benefit of our drug based on improvements observed in the Phase 2a trial and reported associations between the echocardiographic measures evaluated in that study and cardiopulmonary exercise capacity.

**<u>Danicamtiv KINSHIP-DCM Phase 2b/3 trial design</u>**

![LOGO](g107928g20k20.jpg)

The adaptive design is intended to leverage results from the Phase 2b to inform the final Phase 3 design, while active run-in periods are intended to help identify patients that show early benefits of Danicamtiv treatment

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and assess the relationship between early (2 week) and late (6 month) benefits. Prolaio technology is being employed for continuous patient data collection during select periods of the placebo and active run-in portions of the trial as well as the blinded randomized portions for exploratory purposes.

We believe continuous, real-world data collection across a significant proportion of the trial (approximately 8 out of 28 weeks) will provide richer, more accurate data than can be obtained through in-clinic assessments and will allow for enhanced data quantity, quality and a more comprehensive understanding of participants' responses. We anticipate that supplementation of standard clinical assessments with real-world data will bolster the understanding of Danicamtiv's physiological effects in trial participants, providing novel insights that could lead to important adaptations of the Phase 3 trial design and further elucidate the profile of responders vs. non-responders.

We expect to share interim data from the Phase 2b two-week Danicamtiv run-in portion of the KINSHIP-DCM trial in .

**Ataciguat: Our sGC activator for moderate CAVS** 

***Overview***

Ataciguat is an investigational oral, once-daily, sGC activator that aims to slow the deposition of AVC, an underlying driver of disease progression in CAVS, a progressive disease affecting approximately one million U.S. patients. Kardigan acquired rights to ataciguat, an investigational drug developed by, and in-licensed from, Sanofi and Mayo Clinic and is supported by a deep data package, including 22 completed clinical studies, comprehensive safety and toxicology databases and manufacturing readiness. There are currently no effective medical treatments to slow aortic valve calcification, and interventional aortic valve replacement is the only available treatment for severe CAVS. We believe that Ataciguat has the potential to be a first-in-disease starting with individuals with moderate CAVS, where the current standard of care is "watch and wait" monitoring until patients progress to severe disease, and the symptoms warrant replacement of the valve. Unlike prior attempts at developing oral therapies, such as the use of statins that sought to mitigate disease through systemic anti-inflammatory and lipid-lowering pathways, we are taking a precision approach that targets the VICs. Historical landmark trials demonstrated that statins, while effective in atherosclerosis, failed to slow CAVS progression because they do not address the active, cell-mediated calcification process within the valve. Ataciguat is designed to specifically inhibit the transformation of VICs into osteoblast-like cells by reactivating the sGC-cGMP pathway and to slow osteogenic and pro-calcific remodeling, which is the underlying driver of disease progression in CAVS.

In preclinical studies, Ataciguat reduced osteogenic and pro-calcific remodeling of the VICs, slowing AVC deposition and burden in mice. In a Phase 2 trial evaluating the safety and efficacy of Ataciguat in 23 patients with moderate CAVS, Ataciguat treatment attenuated the progression of AVC versus placebo and was associated with improvements in valvular compliance, cardiac structure and function and cardiac output at six months, without observed effects on blood pressure. We believe these results point to the potentially differentiated mechanism of Ataciguat relative to other sGC stimulators and modulators, which to our knowledge have not to date been explored in CAVS. We believe these results support the advancement of Ataciguat in patients with moderate CAVS.

In June 2025, we initiated a Phase 2b/3 clinical trial KATALYST-AV, a two-part, adaptive, parallel-group, randomized, double-blind, placebo-controlled trial. This trial will evaluate the effect of Ataciguat on slowing AVC progression in participants with moderate CAVS, correlate changes in AVC with echocardiographic measures of cardiac structure and function and evaluate how changes in cardiac structure and function relate to symptoms through the assessment of pVO<sub>2</sub>. Given that the underlying cardiac pathophysiology in CAVS leads to the development of heart failure and that exercise intolerance is an important prognostic indicator of systolic

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and diastolic cardiac dysfunction in heart failure, we believe that a treatment-associated difference in pVO<sub>2</sub>, as measured by CPET, would represent a clinically meaningful benefit in the preservation of cardiopulmonary function. In our view, pVO<sub>2</sub> is an optimal registrational endpoint that will measure the potential treatment effect of Ataciguat related to improvements in cardiac structure and functioning rather than only measures of valvular compliance and stiffening alone.

We are deploying Prolaio to enable home based episodic ECG data collection and expect that using our Prolaio platform will yield more VO<sub>2</sub> data than in-clinic CPET alone by making it easier for patients to comply with the protocol. By assessing estimated VO<sub>2 </sub>by Prolaio in the Phase 2b study ("Part A"), we anticipate being able to correlate estimated VO<sub>2 </sub>with pVO<sub>2 </sub>by CPET in the CPET sub-study and correlate to measures of cardiac structure and function for appropriate adjustments to the Phase 3 ("Part B") study. We believe deploying such technology with continuous assessment and modeling may support the Phase 3 trial towards a registrational endpoint of pVO<sub>2</sub> by CPET.

KATALYST-AV is ongoing, and we anticipate baseline data from Part A is expected in , followed by the primary endpoint analysis in .

***Calcific aortic valve stenosis (CAVS)***

CAVS is the third most common cardiovascular disease following hypertension and coronary artery disease, affecting 3.3 million patients in the United States alone, and is the most common acquired heart valve disease in developed countries with a prevalence of approximately 3% of the population over 60 years of age. It is a progressive disease that begins with valvular injury or insult, triggering inflammation, activation of VICs and pathologic remodeling leading to the development of stenosis in the absence of symptoms. A central driver of disease progression is the production and deposition of calcium on the valve leaflets, resulting in progressive valvular stiffening and stenosis with consequent loss of valvular function. As calcification advances, the valve stiffens and valve area decreases, increasing left ventricular afterload and placing sustained pressure on the left ventricle. This chronic pressure overload promotes adverse left ventricular remodeling, impairing cardiac structure and function, reducing cardiopulmonary capacity and ultimately leading to symptoms most often associated with heart failure.

The disease inevitably progresses, typically over several years, to moderate stenosis, comprising about one-third of the overall disease prevalence. Patients with moderate CAVS have increased morbidity and mortality and will eventually progress to severe stenosis. With disease progression, patients with moderate to severe CAVS have a poor prognosis if left untreated, with a five-year event-free survival of less than 40%.

**<u>Ataciguat patient population</u>**

![LOGO](g107928g88m02.jpg)

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Presently, there are no effective medical treatments to slow progression of aortic valve calcification, and interventional aortic valve replacement is the only available treatment for severe CAVS. Current management of mild and moderate CAVS, in the absence of any therapeutic alternative, is "watch and wait" monitoring until patients progress to severe forms of the disease and warrant surgical intervention. As patients progress to severe CAVS, it is estimated that the probability of undergoing surgery or dying if left untreated is over 50% by two years. For patients who develop symptomatic severe aortic stenosis who are treated more conservatively or deemed not eligible for surgical intervention, the two-year survival rate is estimated to be approximately 50%. While the advent of transcatheter aortic valve replacement ("TAVR") has led to a significant increase in access to aortic valve replacement surgeries and improved surgical outcomes, these procedures are not without risk. Potential complications following TAVR include bleeding, atrial fibrillation, stroke, paravalvular leak, conduction block, kidney injury and sudden cardiac death. Post-TAVR, patients continue to progress in disease etiology that can lead to advanced heart failure and sudden death, with 1-year mortality rates ranging from 11-24% and 3-year mortality rates increasing to 34% in co-morbid patients. Additionally, aortic valve replacement is not a permanent therapy as valves require replacement over time, with durability estimated at between eight and 20 years depending on valve type and other factors. Patients who require re-do TAVRs are at increased risk of post-procedural complications.

We are aware of several therapies that are being studied in mild to moderate CAVS with targets that are distinct from Ataciguat's sGC activation mechanism. These include Novartis's pelacarsen which targets Lp(a) and Rednvia's evogliptin targeting DPP-4 inhibition. It is not known whether these drugs will advance to late-stage development in CAVS, and neither of these therapeutics have demonstrated clinical benefit in CAVS to date based on published results. Additionally, pelacarsen has yet to demonstrate an impact on reducing atherosclerotic cardiovascular events. Furthermore, Edwards Lifesciences is currently conducting a study in early TAVR intervention in patients with moderate CAVS. While it is possible that surgical intervention may continue to move earlier in the disease, we believe a safe and tolerable disease modifying pharmacological approach that slows progression and benefits cardiopulmonary function would be well positioned.

***The process of valve calcification***

Aortic valve stenosis is a complex and progressive active disease process that encompasses several biological pathways, anchored in our understanding of the valvular cellular composition. It begins with mechanical and environmental stressors or injury that valvular endothelial cells ("VECs") covering the outer layers of the valve sense and transmit to the quiescent VIC population responsible for tissue homeostasis and repair. The activation of the VICs, in the setting of oxidizing lipids and reactive oxygen species as well as chronic inflammation, induces osteogenic signaling cascades. This can lead to the production and deposition of calcium and drives progression to valve calcification and stenosis.

**<u>Biology of CAVS disease progression</u>**

![LOGO](g107928g88m03.jpg)

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We believe that impaired function of the sGC enzyme in VICs plays a key role in the osteogenic/calcific remodeling process of CAVS. In cells, sGC exists in two forms: the reduced nitric oxide ("NO") responsive form, and the oxidized NO-unresponsive form. Under normal physiological conditions, sGC is preferentially kept in the NO-responsive form, where NO produced by healthy VECs can trigger signaling cascades maintaining VIC quiescence. In CAVS, valvular insults lead to a local oxidative stress environment that results in decreased NO production, blunted sGC activity and activation of VICs. Within VICs, sGC becomes oxidized and inactivated, impairing NO-sGC signaling that normally helps keep VICs in a non-activated state. As a consequence, VICs undergo osteogenic and fibro-calcific remodeling that results in the production and deposition of calcium, causing aortic valve calcification and progressive valve narrowing.

***Our solution—Ataciguat***

Ataciguat is an investigational oral sGC activator that is designed to selectively target oxidized sGC in the VICs. Unlike previously approved sGC stimulators, it is intended to restore NO signaling to blunt osteogenic remodeling, thereby slowing the deposition of AVC and progression to severe CAVS.

Preclinical and clinical studies of CAVS have shown that restoring protective NO signaling in the VICs reduced osteogenesis and aortic valve calcium deposition. However, pharmacologically targeting this pathway has historically been challenging due to widespread expression of sGC throughout the body and off-target side effects that limit tolerance of clinically effective doses, including but not limited to unwanted blood pressure effects. Ataciguat's hypothesized mechanism of action is unique as it is designed to preferentially stimulate the oxidized form of sGC in VICs, restoring local protective NO signaling in valvular tissues and minimizing unwanted vascular side effects typically associated with other approaches to sGC activation, as supported by the Phase 2 trial that resulted in a reduction in AVC deposition without an observed effect on blood pressure or AEs related to hypotension. Previously approved sGC stimulators, such as Vericiguat, restore protective NO signaling in the vasculature, without preferential targeting to valvular oxidized sGC, which clinically has shown an effect on blood pressure and the risk of hypotension.

Approved sGC stimulators, including Vericiguat and Riociguat, act on the reduced, NO-responsive form of sGC, which is the predominant form expressed in systemic vasculature. Because these agents do not distinguish between sGC in diseased valve tissue and sGC expressed throughout the body, their use is associated with systemic vasodilation and dose-limiting hypotension. Among sGC activators, which target the oxidized, heme-free form of sGC, cinaciguat was terminated in clinical development due to an excess of hypotension even at low doses. Ataciguat is a structurally distinct sGC activator that we believe preferentially activates oxidized sGC in diseased valve tissue where oxidative stress is locally elevated, with minimal systemic vasodilatory effect. This hypothesis is supported by the absence of clinically meaningful hypotension observed across more than 900 participants in 22 prior clinical studies of Ataciguat, including the Phase 2 trial in moderate CAVS.

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**<u>Ataciguat—mechanism of action</u>**

![LOGO](g107928g88m04.jpg)

The potential safety and tolerability benefits of this mechanism are consistent with prior experience with Ataciguat. In a Phase 2 clinical trial in individuals with moderate CAVS, Ataciguat was generally well-tolerated with no evidence of symptomatic or asymptomatic hypotension or orthostatic intolerance. These findings, together with favorable safety and tolerability data from 996 participants across 21 additional Phase 1 and Phase 2 trials of Ataciguat, collectively support the safety potential of Ataciguat in participants with CAVS and other cardiovascular conditions.

In preclinical studies, Ataciguat directly blunted osteogenic remodeling in VICs and restored NO signaling that keeps in check pro-remodeling bone morphogenetic protein 2 ("BMP2") cascades in VICs. In mice with established CAVS, treatment with Ataciguat attenuated BMP signaling and slowed progression of valve calcification, while improving both valvular and ventricular function. Results from our completed Phase 2 clinical trial in moderate CAVS demonstrated a slowing in the progression of AVC at 6 months.

Additionally, we believe the clinical changes observed in participants treated with Ataciguat in the Phase 2 trial resulted from improved leaflet compliance due to attenuation of maladaptive calcification, offloading the left ventricle without increasing the aortic transvalvular gradient, or difference in pressure across the aortic valve between the left ventricle and the aorta. Therefore, the functional changes associated with a reduction in AVC deposition are hypothesized to result in a net improvement in cardiopulmonary function in participants treated with Ataciguat compared to placebo.

This hypothesis is supported by the Phase 2 clinical trial of Ataciguat in patients with moderate CAVS, which demonstrated trends toward improvement in left ventricular mass, systolic function and diastolic function, in those treated with Ataciguat compared to placebo.

We believe an important unmet clinical need exists to develop new treatment strategies that address the root cause of the disease, modifying the course of disease progression to improve symptoms and cardiac function. We believe if we can demonstrate Ataciguat's clinical value through generating evidence of clinically meaningful efficacy and favorable safety in our Phase 2b/3 KATALYST-AV trial and subject to regulatory approval, Ataciguat has the potential to emerge as the new standard of care for moderate CAVS. If we are able to demonstrate Ataciguat has a clinically meaningful benefit on slowing the progression of disease, we believe there may also be utility for Ataciguat in the treatment of mild CAVS with HF and in patients post-TAVR, as

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these patients could also benefit from disease modification earlier in the disease progression and from prevention of calcification and worsening ventricular function.

***Clinical data***

We are developing Ataciguat for the treatment of moderate CAVS, but it has also been previously studied for its potential in other disease areas. Ataciguat has been evaluated across 22 completed clinical studies with a total of 996 participants who received at least one dose of Ataciguat under various regimens, ranging from a single dose of 25, 50, 100, or 200 mg to repeated doses of 5 to 200 mg for up to 12 months. Sixteen of these studies were conducted to investigate the safety and PK, including the drug-drug interaction, of Ataciguat, exposing a total of 296 healthy subjects to Ataciguat at doses of up to 200 mg daily for up to 14 days. Six studies were conducted in disease populations including a completed Phase 1b trial in which 19 patients with CAVS received Ataciguat doses of 100 mg or 200 mg daily for 14 days, and a completed Phase 2 trial in which 12 participants with CAVS received doses of 200 mg Ataciguat for up to 12 months.

Ataciguat was generally well-tolerated in all clinical studies in the table below. The types and severity of AEs were similar across all dose regimens. Most AEs considered possibly related to Ataciguat were mild or moderate in severity. A total of nine SAEs, all non-fatal, were reported as related to Ataciguat. All SAEs were reported in only one participant each, except for elevated liver enzymes/hepatitis, which was reported by two participants. With the exception of SAEs for elevation of creatine phosphokinase ("CPK") (n=1) and liver enzymes (n=2), no other clinically relevant laboratory, BP, pulse rate or ECG abnormalities indicating a safety concern with Ataciguat were reported.

The table below provides an overview of all clinical trials of Ataciguat that were conducted in healthy volunteers and diseases other than CAVS. Based on the unique mechanism of action of ataciguat and its preferential targeting to valvular oxidized sGC, we believe there is reason to assess its efficacy in patients with moderate aortic stenosis, differing from patient populations previously studied by Sanofi. ****

**<u>Summary table of studies completed prior to 2009 by Sanofi</u>**

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| | | | |
|:---|:---|:---|:---|
| **Trial ID** | **Phase** | **Subjects** | **Design** |
| 1002 | 1b | 26/27 | Placebo-controlled SAD trial in healthy male volunteers |
| 1004 | 1 | 18/18 | Placebo-controlled DDI trial (aspirin) |
| 1005 | 1 | 6/6 | Investigation of mass balance and metabolism of single oral dose in healthy male volunteers |
| 1006 | 1 | 12/12 | Open-label PK, safety, tolerability of single dose in healthy female volunteers |
| 1007 | 1 | 12/12 | Open-label PK, safety, tolerability of 3 oral formulations under fasting conditions in healthy volunteers |
| 1008 | 1 | 18/36 | Placebo-controlled trial of single oral dose on heart-rate variability |
| 1009 | 1 | 13/13 | Open-label relative bioavailability, PK, safety, tolerability of 3 oral formulations under fasting conditions in healthy volunteers |
| 1010 | 1 | 12/12 | Open-label SAD (capsule formulation) with food interaction screen |
| 1011 | 1 | 37/37 | Open-label multiple-dose in healthy males |
| 1012 | 1 | 13/13 | Open-label DDI trial (tolbutamide) in healthy male volunteers |
| 1013 | 1 | 18/35 | Placebo-controlled DDI trial (warfarin) in healthy male volunteers |
| 1014 | 1 | 23/31 | Placebo-controlled SAD trial in participants with coronary artery disease |

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| | | | |
|:---|:---|:---|:---|
| **Trial ID** | **Phase** | **Subjects** | **Design** |
|  INT 10590 | 1 | 23/23 | Open-label DDI trial (ketoconazole) in healthy volunteers |
|  INT 10682 | 1 | 16/16 | Open-label DDI trial (midazolam) in healthy volunteers |
|  INT 10697 | 1 | 23/23 | Open-label DDI trial (oral contraceptive steroid) in healthy female volunteers |
|  PDY 6744 | 1 | 21/21 | Placebo-controlled DDI trial (glycerol nitrate) in healthy male volunteers |
|  BDR 6935 | 1 | 36/36 | Open-label trial of two capsule formulations under fed/fasted conditions in healthy volunteers |
| 2001 | 2a | 257/313 | Placebo-controlled trial of anti-ischemic activity of multiple doses in participants with stable angina pectoris |
|  DFI 6174 | 2a | 330/553 | Placebo-controlled trial of single dose in participants with peripheral artery disease Fontaine Stage II in combination with clopidogrel |
|  DFI 10569 | 2a | 59/62 | Placebo-controlled trial of single dose in participants with chronic neuropathic pain |

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***<u>Phase 2 moderate CAVS trial</u>***

A Phase 2 randomized, placebo-controlled, double-blind trial in participants with moderate CAVS was conducted to evaluate the safety, tolerability and efficacy of Ataciguat in slowing progression of aortic valve calcification, aortic valve dysfunction and ventricular dysfunction. All patients were studied in the Clinical Research Unit at the Mayo Clinic. A total of 23 randomized participants received oral doses of either 200 mg Ataciguat capsules (n=12) or matching placebo (n=11) daily for at least six months. The primary outcome variable was the change in valvular calcium as assessed by computed tomography scanning. Secondary outcomes were changes in aortic valve area as measured by Doppler and left ventricular function as assessed by two-dimensional echocardiography.

**<u>Ataciguat Phase 2 study design</u>**

![LOGO](g107928g88m05.jpg)

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Results of the Phase 2 trial, published in *Circulation* in February 2025 and post-hoc analyses presented at the American Heart Association Scientific Sessions in November 2025, suggested that treatment with Ataciguat slowed the progression of AVC, leading to improvements in measures of valvular compliance, CO and cardiac function when compared to placebo at 6 months.

After six months of treatment, treatment with Ataciguat attenuated progression of AVC by greater than 50% compared with placebo. Placebo-treated patients displayed progressive worsening of aortic valve stenosis during the six-month follow-up period, while patients on Ataciguat exhibited less worsening of aortic valve stenosis versus baseline. Treatment with Ataciguat appeared to slow the progression of worsening diastolic function and tended to improve measures of systolic function including CO, stroke volume and LVEF, with minimal changes in mean gradient or peak velocity.

**<u>Ataciguat Phase 2 trial key endpoints</u>**

![LOGO](g107928g01a06.jpg)

No deaths were reported during the trial. One SAE of elevated liver enzymes was reported in the Ataciguat arm. The participant was taking concomitant simvastatin and ibuprofen during the treatment period, which were discontinued and liver enzymes returned to normal three months later. A second SAE for worsening dyspnea was reported in a participant in the placebo arm. Importantly, although Ataciguat appeared to slow the progression of valvular calcification, bone mineral density was not negatively impacted by long-term treatment with Ataciguat. A subset of patients continued treatment through 12 months with no new safety signals observed through the full duration of follow-up.

**<u>Phase 1b clinical data</u>**

A Phase 1b randomized, placebo-controlled, double-blind clinical trial was conducted to evaluate the safety of Ataciguat in participants with mild to moderate CAVS. A total of 36 participants with mild to moderate CAVS were given Ataciguat at 100 mg (n=10) or 200 mg (n=9), or matching placebo (n=17) daily for 14 days. All patients were studied in the Clinical Research Unit at the Mayo Clinic. In this trial, Ataciguat was found to be generally well-tolerated with no evidence of symptomatic or asymptomatic hypotension or orthostatic intolerance as assessed with both tilt table testing and a controlled transition from a seated to standing position. No deaths were reported during the trial. Two SAEs were reported in the Ataciguat arm, dizziness and hematuria, and were considered to be mild in severity.

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**<u>Non-clinical studies</u>**

In a preclinical mouse model of CAVS, Ataciguat at approximately 20 mg/kg/d slowed the accumulation of valvular calcium and prevented the progression of aortic valve stenosis and its associated ventricular hypertrophy/dysfunction. In vitro, in cells from human calcific valves, Ataciguat increased the activity of oxidized sGC to produce cyclic guanosine monophosphate ("cGMP"), preventing calcific/osteogenic signaling. Notably, these effects were noted free of blood-pressure reductions, suggesting an intrinsic bias towards tissues with high oxidative stress levels.

The toxicity of repeated doses of Ataciguat was evaluated in rats and dogs. In a six-month GLP oral toxicity trial of Ataciguat in rats, slightly increased liver weights were observed at 500 mg/kg/day. No other toxicologically relevant effects were observed. In a 12-month GLP oral toxicity trial in dogs, no adverse findings were observed after oral administration of Ataciguat up to 200 mg/kg/day.

***Clinical development plan***

In June 2025, we initiated a Phase 2b/3, randomized multicenter placebo-controlled trial with Ataciguat, KATALYST-AV. The trial is currently enrolling patients with moderate CAVS and aims to further evaluate the effect of Ataciguat on slowing the progression of AVC, and to correlate changes in AVC with echocardiographic measures of cardiac structure and function. To evaluate how changes in cardiac structure and function relate to symptoms, the trial will also assess the correlation of AVC to cardiopulmonary function by pVO<sub>2</sub>. Given the underlying cardiac pathophysiology in CAVS can lead to the development of heart failure and that exercise intolerance is an important prognostic indicator of systolic and diastolic cardiac dysfunction in heart failure, we believe a net difference in pVO<sub>2</sub> as measured by CPET between Ataciguat-treated participants and placebo, would be indicative of a clinically meaningful benefit in the preservation of cardiopulmonary function. We believe VO<sub>2</sub> is an appropriate primary endpoint to support the approval of a pharmacologic therapy for moderate CAVS and better represents the treatment effect on the cardiopulmonary function overall rather than valve stiffening alone as measured by changes in AVC. While our study is designed to measure our primary endpoint using CPET, we are also using our Prolaio platform technology to generate exploratory data on VO<sub>2</sub>.

KATALYST-AV is a two-part adaptive trial designed to drive intelligent clinical development that enables us to optimize for efficiency and is designed to increase the probability of success of the trial delivering a result that would support a regulatory filing for Ataciguat.

**<u>Ataciguat KATALYST-AV Phase 2b trial in CAVS</u>**

![LOGO](g107928g01a07.jpg)

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Part A (Phase 2b) aims to investigate the effect of 200mg of daily Ataciguat on slowing progression of AVC and is expected to enroll approximately 132 patients. The change in AVC will be measured at 24 weeks as a primary endpoint in Part A, and key secondary endpoints include change in estimated VO<sub>2</sub> and the correlation of change in estimated VO<sub>2 </sub>and AVC at 48 weeks. We are deploying Prolaio to enable home-based episodic ECG data collection and expect that using our Prolaio platform will yield more VO<sub>2</sub> data than in-clinic CPET alone, making it easier for patients to comply with protocol. Additionally, Part A includes a CPET sub-trial, whereby approximately 50 patients will be enrolled to provide data on the change in pVO<sub>2</sub> at 48 weeks and enable correlations between pVO<sub>2</sub> and other measures of disease progression. Remote data collection of estimated VO<sub>2</sub> and such other key data will be used to drive modeling and project change in pVO<sub>2</sub> in Part B. Data readouts from Part A are meant to inform and provide adaptations to Part B to optimize the design of the overall trial. Part A results will provide a baseline analysis of disease severity and guide whether the population to be enrolled in Part B requires modifications to ensure the patients with the highest potential to benefit are identified. This analysis will include responders vs. non-responders and differences in men and women given the underlying differences in disease etiology. Given the moderate CAVS patient population has never been studied or assessed with clinical endpoints, such as change in VO<sub>2 </sub>and associated changes in measures of cardiac structure and function, we believe there is potential for us to make modifications to the trial to improve the trial design. Additionally, the correlation of change in AVC and VO<sub>2</sub> from Part A will enable us to better model towards the Part B clinical endpoint of change in pVO<sub>2 </sub>as measured by CPET. At the 24-week data readout, we expect to better understand how the ability to reduce calcium correlates to changes in cardiopulmonary function and other related measures of ventricular function and remodeling, and at what rate.

The primary dual endpoint of Part B is change in aortic valve area ("AVA") and pVO<sub>2</sub> via CPET at 48 weeks, and secondary endpoints include change in AVC at 48 weeks, time to decision to proceed with TAVR/surgical aortic valve replacement ("SAVR") or all-cause death and percentage of participants with progression to AVA <1.0cm<sup>2</sup> at 48 weeks. The target enrollment for the trial will be dependent on the data observed in Part A. The trial may continue through 144 weeks based on the results of the 24-week and 48-week readouts.

Baseline data from Part A is expected in , followed by the primary endpoint analysis in .

**Tonlamarsen—Our ASO AGT inhibitor for the post-hospitalization management of ASH** 

***Overview***

Tonlamarsen is an investigational SC liver-directed, once-monthly ASO targeting hepatic AGT for the management of BP in ASH patients post-hospitalization. ASH is defined as a sudden elevation in BP greater than or equal to 180/110 mm Hg. It is estimated that approximately six million patients in the United States present in emergency rooms with ASH each year, with about two million cases leading to hospitalization. Following hospital discharge, ASH patients are in a high-risk, vulnerable period and often experience ongoing health challenges, including persistent HTN and continued risk of end-organ damage in the weeks and months after their hospitalization. During this critical period, ASH patients experience all-cause hospital readmission rates of approximately 18% at 30 days and 35% at 90 days, including readmission for heart failure and chronic kidney diseases, highlighting the urgency to lower BP and improve the transitions of care during this time. Outcomes are particularly poor in this population, particularly for those who have experienced hypertensive emergencies (approximately 500,000 to 600,000 patients), where readmission for heart failure and chronic kidney diseases is common. The estimated 1-year mortality rate for hospitalized ASH patients is 27%. Despite this, there are currently no treatments indicated for the post-hospitalization management of BP in patients with ASH.

Tonlamarsen targets hepatic AGT, a key regulator of BP homeostasis, with a once-monthly ASO designed to enable consistent, sustained BP management during the post-hospitalization transition period, until a patient's condition can be managed with standard oral hypertensive therapeutics. We believe targeting hepatic AGT as a

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once-monthly ASO rather than a once-every-six-month RNAi gene silencing approach offers the opportunity to controllably down-modulate AGT towards well-tolerated levels during a defined treatment period, rather than a prolonged silencing of AGT. This potentially eliminates the need for a reversal agent and can reduce potential toxicities caused by RNAi-mediated, sub-physiologic levels of hepatic AGT causing compensatory renal production of AGT. This compensatory production of AGT in tissues outside the liver can be associated with serious safety issues such as worsening of chronic kidney disease and acute kidney injury.

Kardigan in-licensed exclusive worldwide development and commercialization rights to Tonlamarsen, an investigational drug discovered and developed by Ionis in June 2024. Ionis designed Tonlamarsen as a next-generation ASO to improve on the AGT modulatory properties of previous clinical stage agents. Tonlamarsen was tested in a Phase 1 safety trial and a placebo-controlled Phase 2 trial in participants with uncontrolled HTN on one or more antihypertensive medications who received up to four monthly SC doses of Tonlamarsen. That trial demonstrated that Tonlamarsen reduced AGT levels in patients with uncontrolled HTN, and while not powered to study changes in BP, a shift in BP distributions towards safer levels was observed, demonstrating a BP reduction in patients with higher BP and preferentially associated with patients with higher AGT levels.

We believe that targeting post-hospitalization management of BP in patients with ASH, where we believe the underlying driver of HTN is AGT, can offer significant benefits for patients, including the potential to reduce the risk of recurrent ASH and rehospitalization, particularly for those with poor adherence or physiological resistance to daily medications. Furthermore, the ASH patient population has generally been excluded from studies of HTN, while AGT-targeted therapies have not, to our knowledge, been studied in ASH patients. We therefore conducted a study evaluating Tonlamarsen in uncontrolled HTN patients, combined with Prolaio, to better characterize its activity before initiating our development in ASH patients.

We conducted a larger Phase 2 trial, KARDINAL, to evaluate the BP-lowering efficacy of Tonlamarsen in adult participants with uncontrolled HTN on 2 or more antihypertensive medications that have not achieved their target BP. As part of this trial, we also assessed the Prolaio technology platform for home-based, high-density ECG monitoring and used the Carematix Blipcare BP800 device for home-based BP data collection to identify changes in BP as well as heart failure parameters. Findings of this trial, which were presented at the 2026 American College of Cardiology Annual Meeting and published in *JACC*, showed that Tonlamarsen demonstrated a statistically significant mean reduction in percent plasma AGT levels and a clinically meaningful mean reduction in oSBP across both randomized groups from baseline to Week 20*.* ****Notably, participants with the highest hypertensive burden (oSBP >150 mmHg at baseline) experienced the greatest mean reductions in oSBP. ASH is characterized by BP surges that drive recurrent hospitalizations and risk of end-organ damage. Importantly, Tonlamarsen resulted in greater and more sustained reductions in hSBP surges <u>></u>150 mm Hg by 28%. These data, combined with the insights from our Prolaio platform, enabled us to determine that there was a strong clinical rationale for evaluating Tonlamarsen in patients with ASH.

While many patients who develop ASH have uncontrolled chronic HTN, the specific near-term risk to ASH patients is distinct and, in our view, requires study as a separate disease condition. Insights from the KARDINAL Phase 2 trial in uncontrolled HTN – including the observed AGT reduction and BP improvements, especially in patients with higher baseline BP – directly informed the design and patient selection criteria for our recently initiated KARDINAL-ASH trial, supporting the rationale for targeting AGT in the post-hospitalization management of ASH where discharge BP is expected to be >145 mmHg.

In , we initiated a Phase 2 randomized, blinded, placebo-controlled, multicenter trial, KARDINAL-ASH, to further evaluate safety and efficacy of Tonlamarsen in the ASH patient population*.*** Eligible participants are individuals recently discharged from the hospital with established cardiovascular or renal comorbidities, such as heart failure, cardiovascular disease, peripheral or other vascular disease, renal insufficiency, diabetic or hypertensive nephropathy, who had BP greater than or equal to 180/110 mmHg within the 24 hours preceding

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hospitalization or during the initial 24 hours of hospitalization. In KARDINAL-ASH, we are deploying our Prolaio platform with the Corsano wrist-worn biosensor for continuous home-based BP and ECG data collection during the post-discharge period to characterize BP management, BP excursions and cardiovascular parameters. KARDINAL-ASH does not incorporate electronic patient-reported outcomes, reflecting the focus on objective physiologic measurements of BP management and cardiovascular safety in this acute patient population.

We expect to report results from the KARDINAL-ASH trial in .

***Acute severe hypertension (ASH)***

ASH is defined as a sudden elevation in BP greater than or equal to 180/110 mm Hg, and it is estimated that approximately six million patients in the United States present in ERs with ASH each year. While many patients who develop ASH have underlying chronic HTN, the mechanisms by which patients develop ASH are complex and multi-causal. Standard oral antihypertensive medications for the treatment of chronic HTN have not been demonstrated to reduce the risk of ASH. The specific near-term risk to ASH patients is distinct and, in our view, requires study as a separate disease condition.

A significant portion of the ASH population, about two million patients in the United States, are determined to have severe elevations in BP that require hospitalization, with 500,000 to 600,000 considered to be hypertensive emergencies with evidence of acute target organ damage. Common forms of ASH-related target organ damage can include acute heart failure ("HF") and pulmonary edema, neurologic disorders including encephalopathy, intracerebral hemorrhage and acute ischemic stroke, acute kidney injury ("AKI"), and impacts on the heart, eyes and other organs.

**<u>Tonlamarsen patient population</u>**

![LOGO](g107928g01a08.jpg)

Following hospital discharge, ASH patients are in a high-risk, vulnerable period and often experience ongoing health challenges in the weeks and months after their hospitalization, with persistent HTN and continued risk of acute end-organ damage. There is a critical need to lower BP and improve transitions of care as these patients experience all-cause hospital readmission rates of approximately 18% at 30 days and 35% at 90 days. Outcomes are also poor in this population, particularly for those who have experienced hypertensive emergencies, where readmission for heart failure and chronic kidney disease is common. The estimated 1-year mortality rate for hospitalized ASH patients is 27%.

There are currently no treatments indicated for the post-hospitalization management of BP in patients with ASH. While other clinical-stage therapeutic candidates are targeting AGT, they are addressing a broader patient

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population such as uncontrolled HTN, and, to our knowledge, none of these therapies are being developed specifically to target the ASH patient population. The estimated direct and indirect cost of cardiovascular diseases in the US is more than $400 billion annually. We believe an investigational therapy like Tonlamarsen, which has the potential to provide consistent, sustained and effective BP management with monthly dosing and favorable tolerability, could address a significant unmet need if approved. Such a therapy may be particularly valuable during the high-risk period following an ASH hospitalization and for patients who experience poor adherence or physiological resistance to daily medications.

***Our solution – Tonlamarsen***

Tonlamarsen is an investigational SC, once-monthly ASO designed to target hepatic AGT for the management of BP in ASH post-hospitalization. AGT is a vital protein and hormone primarily produced by the liver. It is the sole precursor of the vital BP homeostasis system that modulates vascular tone and blood volume, while also playing important overall cardiovascular roles. AGT is the most upstream driver of the renin-angiotensin-aldosterone system ("RAAS"), a complex biological pathway essential for regulating BP and blood volume that involves many systems throughout the body including the blood vessels, kidneys, lungs, liver and the adrenal, hypothalamus and pituitary glands. In addition, AGT and its renin-cleaved products, both RAAS-directed and RAAS-independent (Des(Ang I) AGT), are also known to play many systemic roles, and the complete loss of systemic AGT has been shown to be lethal.

**<u>Tonlamarsen AGT mechanism of action</u>**

![LOGO](g107928g00v05.jpg)

RAAS components also include renin and angiotensin-converting enzyme ("ACE"), which can act sequentially on AGT to produce angiotensin I ("Ang I"), a vasoconstrictor, which ultimately results in angiotensin II ("Ang II"), the primary active end-product of the RAAS cascade. Ang II, a potent vasoconstrictor, binds to AT1 receptors and acts via multiple mechanisms to contribute to HTN and related disease states such as HF and chronic kidney disease ("CKD"). In addition, Ang II stimulates the release of aldosterone from the kidneys, which further amplifies BP and fluid volume. Notably, Ang II levels also upregulate AGT expression/production, creating a vicious cycle in which AGT begets AGT.

Imbalance or dysfunction of the RAAS pathway can play a significant role in BP dysregulation and targeting the RAAS system is a known effective method for treating HTN and HF. Oral antihypertensives such as ACE

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inhibitors and angiotensin receptor blockers ("ARBs") work by inhibiting the downstream renin and ACE enzymes that convert Ang I to Ang II. However, the treatment effect of these agents can be limited by compensatory RAAS pathways. Combination therapeutic strategies aimed at improving efficacy, so-called "dual therapy" with an ACE inhibitor plus an ARB, can result in adverse renal effects such as hypotension, hyperkalemia and AKI.

Tonlamarsen is designed to directly target down-modulation of hepatic AGT to regulate the RAAS system upstream, at its sole precursor, as an alternate means of RAAS system modulation to elicit improved BP management. We believe this upstream targeting has the potential to be most efficacious in patients with suboptimal RAAS blockage due to compensatory mechanisms and has the potential to provide the benefits of RAAS suppression while minimizing renal complications. We believe this approach has the potential to lower BP and reduce high BP excursions in post hospitalization ASH patients while providing an optimal safety profile.

There is established rationale for down-modulating AGT in HTN. Human genetic studies have identified variants in the AGT gene, including the M235T polymorphism, that are associated with elevated plasma AGT levels and increased risk of HTN across diverse populations. As the sole precursor of the RAAS cascade, AGT is the most upstream substrate from which all downstream vasoconstrictive and volume-regulatory mediators are derived. In pathological conditions, elevated plasma AGT levels have been linked to increased BP and a higher prevalence of HTN, even after adjusting for other risk factors. Genetic variants in the AGT gene are also associated with increased risk of malignant HTN and ASH. AGT levels are also known to rise in response to stress hormones, including cortisol, which are commonly elevated during acute hypertensive episodes, creating a positive feedback loop in which elevated AGT promotes further RAAS activation and BP dysregulation. Clinical trial results announced by a third party developing a clinical-stage RNAi therapy showed that inhibition of AGT in the liver led to a reduction in circulating Ang II and led to significant reductions in BP in patients with chronic HTN.

Tonlamarsen ASO utilizes ligand-conjugated antisense ("LICA") technology to facilitate its delivery to the liver. Targeting hepatic AGT as a once-monthly ASO enabled controlled down-modulation of AGT levels in the KARDINAL trial, achieving a 67% reduction in plasma AGT levels in patients receiving five monthly doses of 90 mg Tonlamarsen, rather than near-complete silencing of AGT translation seen with RNAi therapies. We believe this distinction is clinically meaningful: a monthly dosing regimen allows for adjustment of therapy based on clinical response, and effects of treatment are expected to resolve more quickly upon discontinuation compared to longer-acting RNAi gene silencing approaches, which achieved near-complete AGT knockdown for approximately six months per dose in data reported from third-party clinical trials. The development of a reversal agent for RNAi-based AGT therapies by a third party further underscores the importance of controllability in this therapeutic class. Because Tonlamarsen primarily targets hepatic AGT while sparing renal AGT production, it has the potential for reduced risk of hyperkalemia and acute kidney injury compared to aggressive systemic RAAS blockade.

The LICA technology incorporated in Tonlamarsen is a triantennary GalNAc moiety that targets ASGPRs on the liver cell surface, resulting in the selective inhibition of AGT expression within the liver. By leveraging this GalNAc-mediated uptake, Tonlamarsen primarily affects circulating AGT while sparing renal production and protecting vital intrarenal signaling. Consequently, by avoiding the excessive inhibition often seen with traditional RAAS blockers, Tonlamarsen has the potential for an improved therapeutic index with a lower occurrence of hyperkalemia and AKI.

***Clinical data***

Three clinical studies of Tonlamarsen have been completed to date, a Phase 1 SAD trial in healthy volunteers and a Phase 2 trial in participants with uncontrolled HTN on one or more antihypertensive medications were

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conducted by Ionis. We conducted a larger Phase 2 trial, KARDINAL, in participants with uncontrolled HTN who are on 2 or more antihypertensive medications.

**<u>KARDINAL Phase 2 clinical trial</u>** 

KARDINAL was a randomized, double-blind, placebo-controlled, parallel group, Phase 2 clinical trial to assess the safety and efficacy of Tonlamarsen in 198 patients with uncontrolled hypertension (systolic blood pressure greater than 135 mmHg) on a background of two to five therapies for the management of chronic hypertension, including greater than 80% on ACE/ARB. As part of this trial, we also assessed the Prolaio technology platform for home-based, high-density ECG monitoring and used the Carematix Blipcare BP800 device for home-based BP data collection to identify changes in BP as well as heart failure parameters. In March, we presented results from KARDINAL at American College of Cardiology's Annual Scientific Session & Expo (ACC.26) and simultaneously published in JACC. In the clinical trial, Tonlamarsen demonstrated a statistically significant mean reduction in percent plasma AGT levels and a clinically meaningful mean reduction in oSBP across both randomized groups from baseline to Week 20. We believe these results highlight the intended biological effect and target engagement of Tonlamarsen and support advancing to a Phase 2b clinical trial in patients with ASH.

The trial was comprised of a four-week Part A placebo lead-in and an active four-week run-in period to identify patients with maximum benefit. Participants were then randomized to monthly injections of Tonlamarsen or placebo for 16 weeks, followed by an eight-week safety follow-up, for a total of 32 weeks. Primary outcome measures were the percent change from baseline in plasma AGT levels to Week 20 and change from baseline in mean systolic blood pressure ("SBP") to Week 20 between treatment groups. Secondary outcome measures included safety and tolerability, proportion of participants with mean office seated SBP <130 mmHg at week 20 (in-office), change from baseline in mean self-assessed home SBP through Week 20, proportion of participants with any daily average home SBP ≥150 mmHg at Week 20 and change from baseline in mean office seated diastolic blood pressure ("DBP") to Week 20.

**<u>Tonlamarsen KARDINAL Phase 2 trial in uHTN</u>**

![LOGO](g107928g01x01.jpg)

After the four-week placebo run-in period, all eligible subjects received 90 mg Tonlamarsen and were then randomized to continued monthly dosing for five total doses or placebo. The results of the clinical trial

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demonstrated a dose-dependent, statistically significant mean reduction in percent AGT levels, with patients receiving five monthly doses of 90 mg Tonlamarsen achieving a 67% reduction from baseline to Week 20 compared with a 23% reduction in patients receiving a single dose (p≤0.0001, co-primary endpoint). Mean reduction in oSBP from baseline to Week 20 did not differ significantly between treatment groups due to an unexpected, prolonged effect in the single dose arm (p=0.97, co-primary endpoint).

**<u>Tonlamarsen KARDINAL Phase 2 data in uHTN</u>**

![LOGO](g107928g01a85.jpg)

In additional analyses, both treatment groups demonstrated a mean reduction in oSBP of -6.7 mmHg from baseline to Week 20 (single-dose Tonlamarsen group: 95% CI, - 9.8 to -3.5 mm Hg; five-dose Tonlamarsen group: 95% CI, -9.8 to -3.6 mm Hg). Notably, participants with the highest hypertensive burden (oSBP >150 mmHg at baseline) experienced the greatest mean reduction in oSBP (-8.9 mmHg to Week 20). Additionally, continued dosing with Tonlamarsen resulted in greater and more sustained reductions in hSBP surges of >150 mmHg during Part C, supporting durability with reduced BP surges >150 mm Hg by 28%. These results, informed through the use of Prolaio, support the clinical rationale for evaluating Tonlamarsen in patients with ASH.

***<u>Prior Ionis sponsored Phase 2 clinical trial</u>***

Ionis conducted a Phase 2 trial in a total of 48 participants with HTN who were randomized 3:1 in parallel cohorts to receive up to four SC monthly doses of Tonlamarsen (30, 60 or 90 mg) or placebo in a double-blind, randomized, placebo-controlled trial. Tonlamarsen was generally well-tolerated. There were no deaths or drug-related SAEs. There were no safety concerns in vital signs, including HR and BP, and no clinically relevant changes in ECGs or laboratory parameters. No safety signals were observed for hyperkalemia, hypotension or acute renal failure ("ARF"), which we believe is an important finding in a population receiving ACE inhibitors and ARB therapy.

Tonlamarsen provided a significant and dose-dependent reduction in plasma AGT at Day 99. AGT reductions were sustained throughout the post-treatment period. Tonlamarsen reduced AGT levels in patients with uncontrolled HTN, and while not powered to study changes in BP, it effectively shifted BP distributions towards safer levels, demonstrating a BP reduction in patients with higher BP that was preferentially associated with patients with higher AGT levels. As a result of this trial, the 90 mg dose was selected for further clinical development.

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**<u>Phase 1 clinical trial</u>** 

Ionis also conducted a Phase 1 SAD trial, in which five dose levels of Tonlamarsen (10, 30, 60, 90 and 120 mg) were evaluated in 40 healthy volunteers who were randomized 3:1 in each dosing cohort. A single dose of Tonlamarsen was generally well-tolerated in healthy volunteers. No deaths, SAEs or drug-related AEs leading to trial discontinuation were reported. There were no safety concerns in vital signs, including HR and BP, and no clinically relevant changes in ECGs or laboratory parameters. Importantly, no clinically relevant events of hyperkalemia, hypotension or renal abnormalities were observed in the trial.

Tonlamarsen showed dose- and concentration-dependent reductions in plasma AGT levels. The mean change and mean percentage change from baseline in AGT reductions were robust, sustained and significant at every visit through Day 71 following a single dose of 60 mg Tonlamarsen and through Day 85 following a single dose of 90 mg or 120 mg Tonlamarsen. The reductions were sustained after dosing and demonstrated a predictable time to offset.

**<u>Non-clinical studies</u>** 

The nonclinical development program for Tonlamarsen has included a wide range of studies evaluating pharmacology, pharmacodynamics ("PD"), PK and toxicology.

Treatment with hepatic AGT ASOs in hypertensive rodent models resulted in robust and sustained BP-lowering effects that were not accompanied by hypotensive events or renal injury. For example, in the high-salt-fed spontaneously hypertensive rat ("SHR"), AGT ASO treatment produced robust BP reduction and reduced mortality relative to ACE inhibitor without any hypotensive events. The safety pharmacology and tolerability of ASO-mediated AGT reduction in rats have been characterized in preclinical studies. Plasma AGT reduction of up to 90% over four weeks did not produce any adverse hemodynamic effects, as no changes in HR or hypotensive effects were observed in healthy, normotensive, salt-replete rats.

Assessment of the toxicity of Tonlamarsen included GLP studies evaluating weekly doses in mice and monkeys over 13 weeks, doses every other week in mice over 26 weeks, and monthly doses in monkeys over nine months. In these toxicology studies, the most noteworthy findings observed in mice and monkeys were non-specific class effects related to the uptake and accumulation or the known proinflammatory effects of ASOs. No toxicologically relevant findings were considered related to the pharmacologic inhibition of AGT expression. Specifically, no hyperkalemia or changes in renal biochemistry were observed.

***Clinical development plan***

We are advancing Tonlamarsen in a late-stage clinical program focused on the post-hospitalization management of BP in patients with ASH. We believe this therapeutic approach could offer significant benefits for patients including the potential to reduce risk of recurrent ASH and rehospitalization, particularly for those with poor adherence or physiological resistance to daily medications. The ASH patient population has generally been excluded from studies of HTN, and AGT-targeted therapies have not been studied in ASH patients who presented with BP greater than or equal to 180/110 mm Hg. While many patients who develop ASH have uncontrolled chronic HTN, the specific near-term risk to ASH patients is distinct and, in our view, requires evaluation as a separate condition.

Our planned clinical development program, KARDINAL-ASH, incorporates learnings from the KARDINAL trial and leverages our Prolaio technology platform for home-based BP data collection to characterize BP management, BP excursions and heart failure parameters during the post-hospitalization period. Key insights from the KARDINAL trial, include an observed relationship between AGT reduction and BP lowering, safety and

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tolerability of co-administration with antihypertensives and other observations from Prolaio-derived high-density BP data. Building on these insights, KARDINAL-ASH is designed to evaluate whether Tonlamarsen can provide sustained BP management during the critical post-discharge transition period when patients are at highest risk of recurrent ASH and rehospitalization.

In , we plan to initiate a Phase 2 trial, KARDINAL-ASH, to further evaluate safety and efficacy in the ASH patient population. KARDINAL-ASH is a Phase 2, randomized, blinded, placebo-controlled, multicenter trial of approximately 100 subjects, designed to assess the efficacy and safety of Tonlamarsen plus usual care in adult patients with ASH. Eligible participants are individuals recently discharged from the hospital with established cardiovascular or renal comorbidities, such as heart failure, cardiovascular disease, peripheral or other vascular disease, renal insufficiency, diabetic or hypertensive nephropathy, who had BP greater than or equal to 180/110 mmHg within the 24 hours preceding hospitalization or during the initial 24 hours of hospitalization. We expect to report results from the KARDINAL-ASH trial in .

**<u>Tonlamarsen KARDINAL Phase 2 trial in ASH</u>**

![LOGO](g107928g88m07.jpg)

**Other clinical stage programs** 

In addition to our late-stage clinical candidates, we are advancing KAR-141 and several discovery-stage therapeutic candidates designed to address the underlying drivers of cardiovascular diseases. KAR-141, in-licensed from BMS Co., is an investigational oral, once-daily, PAR4 antagonist. PAR4 is a GPCR expressed on human platelets that contributes to platelet activation and thrombus propagation. Our discovery efforts focus on indications where we believe our expertise and technologies may enable the identification and development of novel therapies where no treatments exist. We intend to prioritize programs that complement our existing portfolio and leverage our capabilities in cardiovascular disease.

**Prolaio** 

Prolaio is our proprietary clinical intelligence platform with integrated medical insights and data analytics designed to improve the efficiency and quality and increase the probability of success of cardiovascular clinical development. By integrating third-party clinical-grade wearable sensors, a patient-friendly user interface, and proprietary, FDA-cleared AI-based algorithms, Prolaio captures continuous,

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real-world physiologic data, and customized patient-reported outcome information. We plan to compile and analyze this data across our clinical programs to provide deeper insight into treatment effects than traditional, less-frequent clinic-based assessment models.

Our Prolaio platform is currently integrated across each of our clinical trials and utilized by all participating patients. Upon enrollment, a comprehensive Prolaio kit is delivered directly to the patient's home, providing all necessary Bluetooth-enabled hardware to capture key cardiovascular metrics, such as heart rate, respiration rate, heart rate variability, atrial fibrillation, activity, and blood pressure, without a site visit. Through a tailored mobile interface, patients then manage their specific protocols, complete tasks, and record ePROs, ensuring high compliance and engagement while maintaining their normal routines.

To date, Prolaio holds over four million hours of continuous physiologic data and has been deployed in clinical trials across more than 22 countries, in both Kardigan and third-party sponsored trials. The Prolaio ecosystem is supported by over 20 issued patents and seven FDA-cleared algorithms for the measurement of vital signs and other key cardiovascular parameters. This established regulatory and clinical foundation allows us to deploy Prolaio broadly across our pipeline with confidence in data quality, reproducibility and regulatory rigor. Building on its established capabilities today, we believe Prolaio is positioned to shape and enable the design, execution and optimization of modern clinical development for precision cardiology, including through the following:

***Prolaio's benefits today:***

•  ***Longitudinal data collection.*** Using the Prolaio platform, we continuously collect cardiovascular data,
including heart rate, respiration rate, heart rate variability, atrial fibrillation, activity, BP and patient reported outcomes, across our ongoing studies. These data, delivered in a unified system, provide enhanced visibility into patient
physiology at a higher frequency compared to the current fragmented model characterized by episodic in-clinic data collection during visits to trial sites.

•  ***Real-world data at scale.*** By capturing objective, quantifiable physiological and behavioral data from
patients during their daily lives rather than in singular snapshots within a clinical setting, Prolaio may be able to mitigate well-documented sources of bias. These biases include motivation bias and the
Hawthorne effect where patient performance is influenced by expectations of observing researchers. More significantly, the impact of stress-induced "white coat effect hypertension" can cause higher BP readings compared to home or
ambulatory settings. These biases, if left unmitigated, can impair an accurate assessment of treatment effect.

•  ***Near real-time visibility.*** Continuous, near real-time data visibility provides timely and more granular
insight into protocol adherence, data quality, treatment response, and safety.

•  ***Reduced patient burden.*** Prolaio's mobile application is designed to directly reduce patient
burden and prioritize ease of use throughout the clinical journey. By integrating protocolized data collection, and patient-reported outcomes into a single digital interface, we eliminate unnecessary travel and the mental effort of retrospective
recall. Training and support materials are provided on a 'just-in-time' basis, ensuring participation is intuitive, home-based, and seamlessly integrated
into the patient's daily life.

•  ***Rapid, personalized signal detection for faster decision-making.*** Prolaio's first-in-class, FDA-cleared Multivariate Change Index ("MCI") enables detection of statistically significant physiologic change from established personalized
baseline relationships between physiological variables (i.e., a digital twin) over time, which we believe can be used to further inform routine univariate analyses in clinical trials.

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***Future Prolaio benefits in development:***

•  ***Digital clinical endpoints.*** We continue to deploy the Prolaio platform to develop and potentially
validate novel digital biomarkers for use in clinical trials. We aim to use Prolaio's digital tools in pivotal trials for our product candidates and aim to seek FDA alignment in validating one or more novel digital biomarkers for regulatory
decision-making purposes. For instance, we believe the recent clearance of our eVO2peak algorithm could be leveraged as a valid alternative to the CPET derived pVO<sub>2</sub> and six-minute walk test ("6MWT").

•  ***Decentralized trials.*** With digital clinical endpoints, we believe Prolaio has the potential to enable a
modern clinical trial format that extends beyond traditional site-based visits, capturing insights that reflect real-world scenarios. Decentralized trials support near real-time data capture and enhanced observability for sponsors, delivering higher
density real-world datasets, allowing for earlier detection of safety signals, and enabling adaptive trial design. Collectively, these capabilities can improve the generalizability of trial outcomes, accelerate timelines and enable more efficient
trials. In addition, this approach may reduce patient burden, improve adherence and expand access to broader, more representative patient populations.

•  ***Increased statistical power for smaller clinical trials.*** Continuous longitudinal data collection
increases the number and richness of observations per participant, potentially enabling smaller, faster, more cost-effective cardiovascular trials compared with traditional intermittent assessment models. This approach is designed to drive
statistical power by increasing the collected data density between scheduled clinical visits that otherwise would not have been collected under traditional study designs.

•  ***Increased probability of success.*** We believe Prolaio will enable optimized cardiovascular
clinical trials by permitting faster adaptation with greater precision than the traditional, and often fixed, trial approach that relies on intermittent and often sparse data points. We believe this approach may increase our probability of clinical
success due to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Improved patient selection through enrichment strategies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Higher fidelity data to improve signal detection;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Higher frequency data collection to mitigate challenges associated with data gaps; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Optimized dosing strategies designed to increase the likelihood of detecting an effect size and to reduce patient exposure
to suboptimal doses.

***Continuous real-world data collection and our AI algorithms***

Prolaio enables continuous, remote measurement of vital signs and cardiac parameters in real-world settings throughout the entire clinical trial interval, rather than relying solely on periodic, scheduled clinic-based assessments. Unlike traditional clinical trials that rely on infrequent, in-clinic assessments, Prolaio uses clinical-grade sensors worn by participants to capture physiologic data during daily life, including pulse, respiration, activity and electrocardiogram ("ECG"). We believe this real world, continuous data collection provides a more accurate view of physiologic variability while reducing patient and site burden, minimizing data gaps and improving visibility into treatment effects between clinic visits. Prolaio can also integrate data collected from third-party devices required by trial protocols, including measurements such as BP.

Data are transmitted from biosensor(s) or other connected devices to a configurable mobile relay device and application with metrics and cadences specified by the protocols of individual clinical trials. The mobile application supports protocol adherence through structured workflows, reminders and patient education and training materials on demand. The mobile application also enables the capture of ePROs allowing participants to report symptoms, health status and perceived treatment effects.

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High density data collected by the mobile relay device are continuously, securely streamed to the Prolaio cloud environment where proprietary AI-based algorithms analyze the data to generate measures of cardiovascular function and capacity that are then correlated with additional standard clinical assessments. This approach allows us to gain a deeper understanding of cardiovascular disease mechanisms in support of the development of our therapeutic candidates.

Prolaio's recent 510(k) clearance covers our novel estimate of pVO<sub>2</sub> called eVO2peak, which we are actively utilizing as an exploratory measure in our clinical trials for Danicamtiv and Ataciguat. pVO<sub>2</sub> is a clinically accepted measure of a patient's functional capacity derived from CPET and has historically been important in clinical assessment. In a clinical trial setting, however, CPET has practical limitations, including the need for specialized equipment, trained personnel and for patients to complete a strenuous exercise protocol in clinic testing. Clinical trials may use the 6MWT, which is a simpler, less expensive alternative to CPET. However, it typically yields a more variable, statistically noisy estimate of functional capacity and must be performed under supervision in a clinical setting, resulting in limited, infrequent snapshots of capacity. We believe that assessing pVO<sub>2</sub> through Prolaio's eVO2peak digital biomarker approach offers potential advantages, including continuous and near real time data collection, reduced patient and site burden and lower overall cost. Additionally, unlike CPET and 6MWT, eVO2peak does not require a prescribed maximal effort or a fixed-duration exercise test, which we believe further supports its use for continuous assessment of functional capacity in clinical trial settings. ****While our clinical studies of Danicamtiv and Ataciguat are exploring the use of Prolaio to capture eVO2peak, our primary endpoint evaluates pVO<sub>2</sub> to support regulatory decision-making and we do not intend to seek approval on the basis of the eVO2peak measurements collected by Prolaio.

Given the breadth of physiologic measures captured by Prolaio, our platform includes multiple FDA-regulated devices. Prolaio currently has one Class 1 510(k)-exempt medical device data system platform through which all data flow. Prolaio also has 5 FDA Class 2 510(k) clearances covering clinically-validated algorithms for the measurement of vital signs and other cardiovascular parameters. The table below lists these devices, including their FDA classification and, where applicable, the associated premarket notification number. The platform may also incorporate validated algorithms from third-party partners. While Prolaio is authorized for marketing for these purposes, the use of Prolaio in our clinical trials to support regulatory decision-making for our therapeutic candidates has not yet been validated.

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| | | | |
|:---|:---|:---|:---|
| **Device <br>Name** | **Device**<br> **Class** | **Premarket Notification** | **Submission (Year)** |
|  Prolaio Medical Device Data System ("Platform") | 1 | 510(k) Exempt<br> 21CFR§880.6310 | N/A<br> (Current) |
|  Personalized Physiology Analytics Engine (PPA) | 2 | 510(k) Cleared<br> 21CFR§870.2300 | K142512<br> (2015) |
|  Prolaio Heart Rhythm Module (1.0) | 2 | 510(k) Cleared<br> 21CFR§870.2340 | K180234<br> (2018) |
|  Prolaio Heart Rhythm and Respiration Module (2.0) | 2 | 510(k) Cleared<br> 21CFR§870.2340 | K183322<br> (2019) |
|  Prolaio Heart Rhythm and Respiration Module (3.0) | 2 | 510(k) Cleared<br> 21CFR§870.2340 | K193415<br> (2020) |
|  Prolaio eVO2peak Module (1.0) | 2 | 510(k) Cleared<br> 21CFR§870.2200 | K252204<br> (2025) |

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**Manufacturing and Supply** 

We do not own or operate manufacturing facilities or employ manufacturing personnel and have no current plans to establish internal manufacturing capabilities. Instead, we rely, and expect to continue to rely, on established third-party contract manufacturing organizations ("CMOs") for the development, production, testing and supply of our product candidates for preclinical and clinical studies. We maintain internal expertise in technical, manufacturing and quality functions to oversee these activities and support our regulatory submissions.

We intend to rely on third-party CMOs for commercial manufacturing if our product candidates receive regulatory approval. To support potential commercial demand, our manufacturing partners will need to scale production, or we may need to engage additional CMOs. We believe our manufacturing processes can be appropriately scaled to support both clinical and commercial supply requirements. However, interruptions in the supply of raw materials, drug substances, or finished product could impact our development timelines until alternative sources are qualified.

**Commercialization** 

Given our stage of development, we have not yet established a commercial organization or distribution capabilities. If our product candidates receive regulatory approval, we intend to either build a commercial infrastructure to support product sales or utilize third parties for certain commercialization functions. At the appropriate time, we will recruit a sales force and a medical affairs team and take other steps to establish the necessary commercial infrastructure. As our current and future product candidates progress through clinical development, our commercial plans may change. Clinical data, the size of the development programs, the size of our target markets, the size of the requisite commercial infrastructure and manufacturing needs may all influence our commercialization strategies.

**Competition** 

The biotechnology and biopharmaceutical industries are characterized by rapidly advancing technologies, intense competition and a strong emphasis on proprietary products. While we believe that our technology, the expertise of our management team, clinical capabilities, research and development experience and scientific knowledge provide us with competitive advantages, we face increasing competition from many different sources, including biotechnology and biopharmaceutical companies, academic institutions, governmental agencies and public and private research institutions. Any product candidates that we successfully develop and commercialize will compete with existing therapies and new therapies that may become available in the future.

There are a number of large biotechnology and biopharmaceutical companies that are currently pursuing the development of new treatments for cardiovascular diseases. These include large companies with revenues and significant financial resources. However, we are not aware of any other companies currently in clinical development with therapeutics targeting the root cause of genetic DCM, moderate CAVS, or ASH.

To our knowledge, there are currently no other late-stage assets in development for genetic DCM. Cytokinetics is developing omecamtiv mecarbil ("OM"), a cardiac myosin activator, in a Phase 3 trial for patients with HFrEF and an ejection fraction of less than 30%, with trial completion expected in 2028. OM may be relevant as an adjacent competitive product. There are a number of assets in early clinical development for DCM more broadly, including oral small molecules, antibodies, and allogeneic stem therapy approaches. There is only one early-stage program we are aware of that is targeting sarcomeric genetic DCM, a BAG3 AAV gene therapy in development by Rocket Pharmaceuticals.

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There are currently no approved pharmacological treatments available specifically for slowing the progression of AVC in moderate CAVS. We are aware of several therapies that are being studied in mild to moderate CAVS with targets that are distinct from the role of sGC in the disease process. These include Novartis' pelacarsen, targeting Lp(a), and Rednvia's evogliptin, targeting DPP-4 inhibition. It remains uncertain whether these therapies will advance to late-stage development in CAVS, and neither therapy has demonstrated clinical benefit in CAVS to date. Additionally, pelacarsen has yet to demonstrate an impact on reducing atherosclerotic cardiovascular events. In addition, Edwards Lifesciences is currently conducting a study on the risks and benefits of earlier TAVR intervention in patients with moderate CAVS. While it is possible that surgical intervention may continue to move earlier in the disease, we think a safe and tolerable disease modifying pharmacological approach that slows progression and benefits cardiopulmonary function would be well positioned.

There are currently no approved therapies available specifically indicated to reduce blood pressure in ASH patients following hospital discharge to mitigate high hospital readmission rates and poor outcomes during this vulnerable period. However, we may face indirect competition from new therapeutics in clinical development to treat chronic HTN. Roche/Alnylam are developing an RNAi targeting AGT, zilebesiran, for twice-yearly treatment of uncontrolled HTN and resistant HTN and the program is currently in Phase 3 clinical trials. In a completed Phase 2 trial, zilebesiran demonstrated clinically meaningful, though not statistically significant, reductions in BP when added to antihypertensive medications. To date, clinical trials of zilebesiran have excluded patients with secondary HTN, including ASH. Aldosterone synthase inhibitors ("ASIs") are another emerging class of therapies being developed for treatment-resistant HTN as once-daily oral therapies, including AstraZeneca's baxdrostat and Mineralys Therapeutics' lorundrostat, both of which have had NDAs accepted for review by the FDA in the United States. Hyperkalemia is the most commonly observed AE in clinical studies of ASIs.

**Intellectual Property** 

We strive to protect and enhance the intellectual property and proprietary technology that are commercially important to the development of our business, including seeking, maintaining and defending patent rights, whether developed internally or licensed from third parties. We may also rely on trademarks, copyrights and trade secrets relating to our proprietary technology platform and on know-how, continuing technological innovation and in-licensing opportunities to develop, strengthen and maintain our proprietary and intellectual property position. We additionally may rely on regulatory and other protections afforded through data exclusivity, market exclusivity and patent term extensions, where available.

Our commercial success depends in part upon our ability to obtain and maintain patent and other proprietary protection for commercially important technologies, inventions and trade secrets related to our business, defend and enforce our intellectual property rights, particularly our patent rights, preserve the confidentiality of our trade secrets and operate without infringing valid and enforceable intellectual property rights of others. A discussion of risks relating to intellectual property is provided under the section titled "*Risk Factors—Risks Related to Intellectual Property*."

The patent positions for biopharmaceutical companies like us are generally uncertain and can involve complex legal, scientific and factual issues. In addition, the coverage claimed in a patent application can be significantly reduced before a patent is issued, and its scope can be reinterpreted and even challenged after issuance. As a result, we cannot guarantee that any of our product candidates will be protectable or remain protected by enforceable patents. We cannot predict whether the patent applications we are currently pursuing will issue as patents in any particular jurisdiction or whether the claims of any issued patents will provide sufficient protection from competitors. Any patents that we hold may be challenged, circumvented or invalidated by third parties.

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As of March 1, 2026, our patent estate, including patents and pending applications that we in-license from third parties and patents and pending applications that we obtained through our acquisition of the Prolaio platform, contains over 530 issued patents and pending patent applications directed to our product candidates and certain of our proprietary technology, inventions and improvements. In the United States, we own 4 U.S. issued patents, 3 pending non-provisional patent applications, and 1 provisional patent application. In jurisdictions outside of the United States, we own 9 issued patents and 7 non-provisional patent applications. Additionally, in the United States, we exclusively in-license 16 issued patents and 10 pending non-provisional patent applications. In jurisdictions outside of the United States, we exclusively in-license approximately 330 issued patents and approximately 150 pending patent applications, including 2 Patent Cooperation Treaty ("PCT") applications that, in some cases, are counterparts to the foregoing U.S. patents and patent applications.

Our patent estate includes patents and pending patent applications for our clinical stage product candidates Ataciguat, Danicamtiv, and Tonlamarsen, as well as our preclinical stage candidates and proprietary inventions and improvements relating to our acquired Prolaio platform. With respect to Ataciguat, Danicamtiv, Tonlamarsen, our preclinical stage candidates and our Prolaio platform, our patent estate as of March 1, 2026, is summarized below.

With respect to our Ataciguat program, we exclusively in-license from Mayo a patent family directed to methods of using Ataciguat for treating heart valve calcification and aortic sclerosis. The patent family includes granted patents in the U.S., Germany, Spain, France, Great Britain and Italy. The patent family also includes a pending patent application in the U.S. The granted patents and any patent issued from a pending patent application in the patent family are expected to expire in 2033, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

With respect to our Danicamtiv program, we exclusively in-license from MyoKardia six patent families directed to the composition of matter for Danicamtiv, salts and crystalline forms thereof, manufacturing methods and methods of treatment. Patent Family 1 of the Danicamtiv program is directed to the composition of matter of Danicamtiv and includes granted patents in such jurisdictions as the U.S., Canada, China, France, Germany, Great Britain and Japan. Patent Family 1 also includes pending patent applications in the U.S., China and certain other jurisdictions and an allowed patent application in the European Patent Office. The granted patents included in Patent Family 1 and any patent issuing from a pending or allowed patent application in Patent Family 1, if granted, are expected to expire in 2036, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 2 of the Danicamtiv program is directed to the composition of matter of solid forms (e.g., crystalline forms) of Danicamtiv and includes granted patents in the U.S. and certain other jurisdictions. Patent Family 2 of the Danicamtiv program also includes pending patent applications in such jurisdictions as the U.S., Canada, China, the European Patent Office and Japan. The granted patents included in Patent Family 2 and any patent issuing from a pending patent application in Patent Family 2, if granted, are expected to expire in 2040, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 3 of the Danicamtiv program is directed to methods of treating systolic dysfunction, including types of dilated cardiomyopathy, with Danicamtiv and includes pending applications in such jurisdictions as the U.S., Canada, China, the European Patent Office and Japan. Any patent issuing from a pending patent application in Patent Family 3, if granted, is expected to expire in 2040, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 4 of the Danicamtiv program is directed to methods of manufacturing Danicamtiv and includes granted patents in such jurisdictions as the U.S. and Japan. Patent Family 4 of the Danicamtiv program also includes pending applications in Canada, China, the European

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Patent Office, and certain other jurisdictions. The granted patents included in Patent Family 4 and any patent issuing from a pending patent application in Patent Family 4, if granted, are expected to expire in 2039, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 5 of the Danicamtiv program is also directed to methods of manufacturing Danicamtiv and includes a pending PCT application. Any patent claiming priority to the PCT application of Patent Family 5, if granted, will be expected to expire in 2045, exclusive of any possible patent term adjustments, extensions, or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 6 of the Danicamtiv program is directed to methods of treating atrial dysfunction with Danicamtiv and includes pending patent applications in such jurisdictions as the U.S., Canada, China and the European Patent Office, and an allowed patent application in Japan. Any patent issuing from a pending or allowed patent application in Patent Family 6, if granted, is expected to expire in 2041, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

With respect to our Tonlamarsen program, we exclusively in-license from Ionis four patent families directed to the composition of matter for Tonlamarsen, generically or specifically, methods of using Tonlamarsen to modulate angiotensinogen expression, and methods of using Tonlamarsen to treat disorders mediated by angiotensinogen expression. Patent Family 1 of the Tonlamarsen program is generically directed to the composition of matter of Tonlamarsen and includes pending patent applications in such jurisdictions as the U.S., Canada, China, the European Patent Office and Japan. Any patent issuing from a pending patent application in Patent Family 1, if granted, is expected to expire in 2036, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 2 of the Tonlamarsen program is directed to the composition of matter and pharmaceutical compositions of Tonlamarsen and includes granted patents in such jurisdictions as the U.S., China, France, Germany, Great Britain, Japan, Italy and Spain. Patent Family 2 of the Tonlamarsen program also includes pending patent applications in such jurisdictions as Canada, China, the European Patent Office and Japan, and an allowed patent application in the U.S. The granted patents included in Patent Family 2 and any patent issuing from a pending or allowed patent application in Patent Family 2, if granted, are expected to expire in 2041, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 3 of the Tonlamarsen program is directed to methods and Tonlamarsen compositions for reducing angiotensin in a subject and includes a pending PCT application. Any patent claiming priority to the PCT application of Patent Family 3, if granted, is expected to expire in 2044, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 4 of the Tonlamarsen program is directed to a modified antisense oligonucleotide that generically encompasses Tonlamarsen to treat RAS pathway mediated resistant hypertension and includes granted patents in such jurisdictions as France, Germany, Great Britain, Italy and Spain. Patent Family 4 of the Tonlamarsen program also includes a pending patent application in the European Patent Office. The granted patents included in Patent Family 4 and any patent issuing from the pending European Patent Office patent application of Patent Family 4, if granted, are expected to expire in 2033, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

We also own a U.S. provisional patent application directed to methods of using Tonlamarsen for treating acute severe hypertension and any patent issuing from a patent application claiming priority to the U.S. provisional application, if granted, is expected to expire in 2046, exclusive of any possible patent term adjustments,

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extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

We exclusively in-license from BMS Co. two patent families directed to small molecule protease activated receptor 4 ("PAR4"), inhibitors. Patent Family 1 is directed to small molecule PAR4 inhibitors and methods of treating thromboembolic disorders and includes granted patents in such jurisdictions as the U.S., Canada, China, Germany, Great Britain, France, Italy, Japan and Spain. Patents included in Patent Family 1 are expected to expire in 2033, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 2 is directed to the composition of matter of solid forms (e.g., crystalline forms) of a small molecule PAR4 inhibitor and its use in the treatment of thromboembolic disorders. Patent Family 2 includes granted patents in such jurisdictions as the U.S., China, Germany, Great Britain, France, Italy and Japan. Patent Family 2 also includes pending patent applications in the U.S., China and certain other jurisdictions, and an allowed patent application in Canada. The granted patents included in Patent Family 2 and any patent issuing from a pending or allowed patent application in Patent Family 2, if granted, are expected to expire in 2039, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

Through our acquisition of Prolaio, Inc., we obtained a portfolio of patent families for the Prolaio platform technology including three patent families directed to systems and methods for residual-based health monitoring, improving cardiovascular health and for detecting conditions from physiology data. Patent Family 1 is directed to systems and methods for residual-based health monitoring and includes granted patents in the U.S., Canada, China, France, Germany, Great Britain and Japan. Patent Family 1 also includes an allowed U.S. patent application and a pending U.S. patent application. The granted patents included in Patent Family 1 and any patent issuing from a pending or allowed patent application in Patent Family 1, if granted, are expected to expire in 2031, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 2 is directed to systems and methods for improving cardiovascular health and includes three granted U.S. patents and a granted patent in China. Patent Family 2 also includes pending patent applications in jurisdictions such as the U.S and the European Patent Office. The granted patents included in Patent Family 2 and any patent issuing from a pending patent application in Patent Family 2, if granted, are expected to expire from 2039 to 2040, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees. Patent Family 3 is directed to apparatuses and methods for detecting conditions from physiology data and includes pending patent applications in the U.S., Canada, China, the European Patent Office and Japan. Any patent issuing from a pending patent application in Patent Family 3, if granted, is expected to expire in 2043, exclusive of any possible patent term adjustments, extensions or other forms of exclusivity and assuming payment of appropriate maintenance, renewal, annuity and other governmental fees.

In the United States, the term of a patent covering an FDA-approved drug may be eligible for a patent term extension under the Hatch-Waxman Act as compensation for the loss of patent term during the FDA regulatory review process. The period of extension may be up to five years beyond the expiration of the patent but cannot extend the remaining term of a patent beyond a total of 14 years from the date of product approval. Only one patent among those eligible for an extension may be extended, and a given patent may only be extended once. Similar provisions are available in Europe and in certain other jurisdictions to extend the term of a patent that covers an approved drug. If our product candidates receive FDA approval, we intend to apply for patent term extensions, if available, to extend the term of patents that cover the approved product candidates. We also intend to seek patent term extensions in any jurisdictions where they are available, however, there is no

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guarantee that the applicable authorities, including the FDA, will agree with our assessment of whether such extensions should be granted, and even if granted, the length of such extensions.

In addition to patent protection, we also rely on know-how and trade secret protection for our proprietary information to develop and maintain our proprietary position. However, know-how and trade secrets can be difficult to protect. Although we take steps to protect our proprietary information, including restricting access to our premises and our confidential information, as well as entering into agreements with our employees, consultants, advisors and potential collaborators, third parties may independently develop the same or similar proprietary information or may otherwise gain access to our proprietary information. As a result, we may be unable to meaningfully protect our know-how, trade secrets, and other proprietary information.

In addition, we plan to rely on regulatory protection based on orphan drug exclusivities data exclusivities, and market exclusivities. See "—*Government Regulation*" for additional information.

**License and collaboration agreements** 

***License agreements with BMS Co.***

In November 2024, we entered into a License Agreement with MyoKardia, a wholly owned subsidiary of BMS Co., related to Danicamtiv and other compounds (the "Dani Agreement"), and a separate License Agreement with BMS Co. related to KAR-141 (formerly known as BMS-986141) ("Par4") and other compounds (the "Par4 Agreement").

*Dani agreement* 

Under the Dani Agreement, we received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain MyoKardia patents and know-how to develop, manufacture, and commercialize Danicamtiv (formerly known as MYK-491) and certain related compounds (collectively, the "Dani Licensed Compounds") and pharmaceutical products containing such Dani Licensed Compounds ("Dani Licensed Products") for all human uses (the "BMS Licensed Field") worldwide. We are obligated to use commercially reasonable efforts to (i) develop and seek regulatory approval for at least one Dani Licensed Product in at least one indication in the BMS Licensed Field in the U.S. and a certain number of major European markets in accordance with an agreed upon development plan, and (ii) commercialize at least one Dani Licensed Product for at least one indication in the BMS Licensed Field in the U.S. and a certain number of major European markets for which we (or an affiliate, sublicensee or subcontractor) have obtained regulatory approval.

As partial consideration for the rights granted to us under the Dani Agreement, we entered into a Subscription Agreement with MyoKardia pursuant to which we issued 1,251,107 shares of Series A Preferred Stock to MyoKardia. As additional consideration for the licenses granted under the Dani Agreement, we are required to pay MyoKardia: (i) tiered royalties at a rate based on aggregate annual net sales by us, our affiliates and sublicensees of each Dani Licensed Product containing the same Dani Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by us, if we sublicense to a third party within 24 months of the effective date, or November 2026; (iii) up to $42.5 million in the aggregate in development and regulatory milestone payments across all Dani Licensed Products; and (iv) up to $265.0 million in sales milestone payments for each of the first two Dani Licensed Products to achieve the applicable sales milestones. Our tiered royalties range from a subteen to high teen percentage of annual net sales of the Dani Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to competition from generic products, for certain third party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act of 2022 (the "Inflation Reduction Act"), subject to a customary reduction floor and potential carry-forward. The royalty term will expire on a country-by-country basis as to each Dani

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Licensed Product upon the later of: (i) the expiration or termination of the last valid claim of any of MyoKardia's patent rights covering the composition of matter or method of using or making such Dani Licensed Product in such country; (ii) the expiration of regulatory exclusivity in such country for such Dani Licensed Product; and (iii) a specified anniversary of the first commercial sale of such Dani Licensed Product in such country. Upon expiration of the Dani Agreement in its entirety, our license under MyoKardia's patents and know-how will become fully paid-up, royalty-free, perpetual and irrevocable.

During the first five years from the effective date, or until November 2029, we and our affiliates may not, either ourselves or through or on behalf of a third party, directly or indirectly develop, manufacture (excluding manufacturing for preclinical development), or commercialize any competing molecule, other than a Dani Licensed Compound or Dani Licensed Product, that directly and selectively binds to cardiac myosin and either (i) stimulates, activates or otherwise increases cardiac myosin recruitment primarily in the ventricles or (ii) enhances cross bridge engagement primarily in the ventricles. In addition, in the event of a change of control of the Company, the acquiring entity and its pre-existing affiliates may continue the clinical development or commercialization of any competing molecule that such entity or its affiliates were developing or commercializing immediately prior to the consummation of such change of control, subject to certain conditions and restrictions, including the implementation of customary firewalls and restrictions on the use of MyoKardia's intellectual property and confidential information.

Under the Dani Agreement, we will deliver data packages to MyoKardia for the first Phase 2 trial and the first Phase 3 trial for any pharmaceutical product containing Danicamtiv or a related compound ("Dani Lead Compound Licensed Products") in each of the following indications: (a) atrial fibrillation and (b) dilated cardiomyopathy or genetic dilated cardiomyopathy. Upon receipt of each data package, MyoKardia will have the right of first negotiation with respect to (i) co-funding development or co-commercialization of such Dani Lead Compound Licensed Products or (ii) exclusively licensing or acquiring all rights to such Dani Lead Compound Licensed Products. MyoKardia's right of first negotiation will apply to any subsequent Phase 2 or Phase 3 trials of such Dani Lead Compound Licensed Products to the extent we have not previously assigned or granted rights to develop or commercialize such Dani Lead Compound Licensed Products to a third party as permitted by the Dani Agreement.

Either party may terminate the Dani Agreement in its entirety for the other party's uncured material breach or upon certain insolvency events involving the other party. We may terminate the Dani Agreement (i) if we believe that development or commercialization of the Dani Licensed Products would pose an unacceptable safety risk to patients or (ii) for convenience, in each case, subject to specified prior written notice periods. If we or our affiliates or sublicensees contest or assist any third party in challenging the scope, validity, or enforceability of any MyoKardia patent that specifically relates to the composition of matter, formulation, or method of use or manufacture of the Dani Licensed Compounds or Dani Licensed Products, MyoKardia may terminate the Dani Agreement or, if such termination is not an available remedy under applicable law, increase our milestone payments, sublicensing revenues and royalty payments by a mid-double digit percentage, in each case, subject to certain exceptions.

Upon termination of the Dani Agreement for any reason, all licenses granted by MyoKardia will terminate and we must stop developing, manufacturing or commercializing all Dani Licensed Products (except that we may sell any inventory of usable Dani Licensed Products for a limited period). In certain termination scenarios (other than our termination for convenience or for safety reasons), MyoKardia will be required to negotiate in good faith a direct license with our existing sublicensees, subject to certain conditions. If the Dani Agreement is terminated for any reason other than our termination for unacceptable patient safety risks, we will, amongst other obligations, (i) automatically grant MyoKardia a royalty-bearing, exclusive, sublicensable, reversion license under certain intellectual property and know-how controlled by us or our affiliates relating to the Dani

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Licensed Compounds and Dani Licensed Products being developed by us or our affiliates or sublicensees as of the effective date of termination to develop, manufacture and commercialize such Dani Licensed Compounds and Dani Licensed Products in the BMS Licensed Field, with the royalty rate to be negotiated and agreed upon in good faith by the parties, and (ii) transfer and assign to MyoKardia certain regulatory documents and know-how relating to the Dani Licensed Compounds and Dani Licensed Products in the BMS Licensed Field.

*Par4 agreement* 

Under the Par4 Agreement, we received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain BMS Co. patents and know-how to develop, manufacture, and commercialize BMS-986141 and certain related compounds (collectively, the "Par4 Licensed Compounds") and pharmaceutical products containing such Par4 Licensed Compounds ("Par4 Licensed Products") in the BMS Licensed Field (as defined above) worldwide. We are obligated to use commercially reasonable efforts to (i) develop and seek regulatory approval for at least one Par4 Licensed Product in at least one indication in the BMS Licensed Field in the U.S. and a certain number of major European markets in accordance with an agreed upon development plan, and (ii) commercialize at least one Par4 Licensed Product for at least one indication in the BMS Licensed Field in the U.S. and a certain number of major European markets for which we (or an affiliate, sublicensee or subcontractor) have obtained regulatory approval.

As partial consideration for the rights granted under the Par4 Agreement, we entered into a Subscription Agreement with BMS Co. pursuant to which we issued 293,469 shares of Series A Preferred Stock. As additional consideration for the licenses granted under the Par4 Agreement, we are required to pay BMS Co.: (i) tiered royalties at a rate based on aggregate annual net sales by us, our affiliates and sublicensees of each Par4 Licensed Product containing the same Par4 Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by us, if we sublicense to a third party within a certain number of months from the effective date, or November 2026; (iii) up to $10.0 million in the aggregate in development and regulatory milestone payments across all Par4 Licensed Products and (iv) up to $265.0 million in sales milestone payments for each of the first two Par4 Licensed Products to achieve the applicable sales milestones. Our tiered royalties range from a subteen to high teen percentage of annual net sales of the Par4 Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to competition from generic products, for certain third party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act, subject to a customary reduction floor. The royalty term will expire on a country-by-country basis as to each Par4 Licensed Product upon the later of (i) the expiration or termination of the last valid claim of any of BMS Co.'s patent rights covering the composition of matter or method of using or making such Par4 Licensed Product in such country; (ii) the expiration of regulatory exclusivity in such country for such Par4 Licensed Product; and (iii) a specified anniversary of the first commercial sale of such Par4 Licensed Product in such country. Upon expiration of the Par4 Agreement in its entirety, our license under BMS Co.'s patents and know-how will become fully paid-up, royalty-free, perpetual and irrevocable.

During the first five years from the effective date, or until November 2029, we and our affiliates may not, either ourselves or through or on behalf of a third party, directly or indirectly develop, manufacture (excluding manufacturing for preclinical development), or commercialize any molecule that directly binds to Par4. In addition, in the event of our change of control, the acquiring entity and its pre-existing affiliates may continue the clinical development or commercialization of any competing product that such entity or its affiliates were developing or commercializing immediately prior to the change of control, subject to certain conditions and restrictions, including the implementation of customary firewalls and restrictions on the use of BMS Co.'s intellectual property and confidential information.

Under the Par4 Agreement, we will deliver data packages to BMS Co. for the first Phase 2 trial and the first Phase 3 trial for any pharmaceutical product containing Par4 or a related compound ("Par4 Lead Compound

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Licensed Product"). Upon receipt of each data package, BMS Co. will have the right of first negotiation with respect to (i) co-funding development or co-commercialization of such Lead Compound Licensed Product or (ii) exclusively licensing or acquiring all rights to such Lead Compound Licensed Product. BMS Co.'s right of first negotiation will apply to any subsequent Phase 2 or Phase 3 trials of such Par4 Lead Compound Licensed Products to the extent we have not previously assigned or granted rights to develop or commercialize such Par4 Lead Compound Licensed Products to a third party as permitted by the Par4 Agreement.

Either party may terminate the Par4 Agreement in its entirety for the other party's uncured material breach or upon certain insolvency events involving the other party. We may terminate the Par4 Agreement if (i) we believe that development or commercialization of the Par4 Licensed Products would pose an unacceptable safety risk to patients or (ii) for convenience, in each case, subject to specified prior written notice periods. If we or our affiliates or sublicensees contest or assist any third party in challenging the scope, validity, or enforceability of any BMS Co. patent that specifically relates to the composition of matter, formulation, or method of use or manufacture of the Par4 Licensed Compounds or Par4 Licensed Products, BMS Co. may terminate the Par4 Agreement or, if such termination is not an available remedy under applicable law, increase our milestone payments, sublicensing revenues and royalty payments by a mid-double digit percentage, in each case, subject to certain exceptions.

Upon termination of the Par4 Agreement for any reason, all licenses granted by BMS Co. will terminate and we must stop developing, manufacturing and commercializing the Par4 Licensed Products (except that we may sell any inventory of usable Par4 Licensed Products for a limited period). In certain termination scenarios (other than our termination for convenience or for safety reasons), BMS Co. will be required to negotiate in good faith a direct license with our existing sublicensees, subject to certain conditions. If the Par4 Agreement is terminated for any reason other than our termination for unacceptable patient safety risks, we will, amongst other obligations: (i) automatically grant BMS Co. a royalty-bearing, exclusive, sublicensable, reversion license under certain intellectual property and know-how controlled by us or our affiliates relating to the Par4 Licensed Compounds and Par4 Licensed Products being developed by us or our affiliates or sublicensees as of the effective date of termination to develop, manufacture and commercialize such Par4 Licensed Compounds and Par4 Licensed Products in the BMS Licensed Field, with the royalty rate to be negotiated and agreed upon in good faith by the parties, and (ii) transfer and assign to BMS Co. certain regulatory documents and know-how relating to the Par4 Licensed Compounds and Par4 Licensed Products.

***License agreement with Ionis***

In June 2024, we entered into a License Agreement (the "Ionis License Agreement") with Ionis Pharmaceuticals, Inc. ("Ionis"), pursuant to which we were granted an exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to develop and commercialize Tonlamarsen (formerly ION904) and products containing Tonlamarsen (the "Licensed Ionis Products") in the field of prophylactic or therapeutic use in humans (the "Ionis Licensed Field"). We also received a non-exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to manufacture Tonlamarsen and Licensed Ionis Products in the Ionis Licensed Field. We are obligated to use commercially reasonable efforts to develop the Licensed Ionis Product in accordance with a specified development plan and to commercialize at least one Licensed Ionis Product in the Ionis Licensed Field in the United States and in a certain number of major European countries.

Until the third anniversary of the effective date of the Ionis License Agreement, or June 2027, neither party may develop or commercialize, or assist or grant a third party rights to develop or commercialize certain ASOs designed to bind to RNA encoded by the human angiotensinogen gene, subject to certain exceptions. In addition, for the duration of the term of the Ionis License Agreement, Ionis and its affiliates may not develop or

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commercialize, or assist or grant a third party rights to develop or commercialize a certain ASO designed to bind to RNA encoded by the human angiotensinogen gene.

As initial consideration for the Ionis License Agreement, we made an upfront payment of $20.0 million to Ionis. As additional consideration for the licenses and rights granted to us by Ionis, we are required to pay Ionis: (i) milestone payments in the event of successful achievement of specified development and sales milestones of up to $35.0 million in development and regulatory milestone payments and up to $340.0 million in sales milestone payments; (ii) tiered royalties on net sales of Ionis Licensed Products by us, our affiliates and sublicensees with a rate based on net sales per calendar year, ranging from a subteen percentage to high teen percentage. The royalties are subject to potential reductions under certain scenarios. In the event that we undergo a change of control prior to receiving regulatory approval and are acquired by one of certain major biopharmaceutical or pharmaceutical companies, we will be required to pay Ionis a one-time change of control payment based on the acquisition price, ranging in the low tens of millions of dollars. The payment will accrue interest at a subteen percentage rate per annum, compounded annually, from the date of the Ionis License Agreement through the date such payment is made.

The royalty term will terminate on a Licensed Ionis Product-by-Licensed Ionis Product and country-by-country basis as to each Licensed Ionis Product upon the later of (i) expiration or termination of the last valid claim within certain Ionis patents, (ii) the date of expiration of any regulatory exclusivity for such Licensed Ionis Product, and (iii) a specified anniversary of the first commercial sale of such Licensed Ionis Product.

Unless earlier terminated, the Ionis License Agreement will continue on a Licensed Ionis Product-by-Licensed Ionis Product and country-by-country basis until the expiration of the royalty term for such Licensed Ionis Product in such country. We may terminate the Ionis License Agreement for convenience upon prior written notice, and Ionis may terminate the Ionis License Agreement for our lack of material development or commercialization activities with respect to the Licensed Ionis Product for a certain continuous period of time, subject to a notice and cure period. Our lack of material development or commercialization activities based on written agreement of the parties or due to factors outside of our reasonable control will not trigger this termination right for Ionis. Either party may terminate the Ionis License Agreement for uncured material breach or certain insolvency events involving the other party.

Upon termination of the Ionis License Agreement for any reason, all licenses granted by Ionis will terminate and we must stop developing, manufacturing and commercializing the Licensed Ionis Products (except that we may complete and sell any works-in-progress and inventory for a limited period). If Ionis terminates the Ionis License Agreement, any sublicenses granted by us will survive and will be automatically assigned to Ionis, provided that the sublicense was granted in accordance with the Ionis License Agreement and the sublicensee is not in breach of the applicable sublicense agreement. Subject to such surviving sublicenses, in certain termination scenarios, Ionis will have the right to commercialize the Licensed Ionis Product, and the parties will negotiate reasonable economics therefor.

***License agreement by and between Sanofi ("Sanofi") and Rancho Santa Fe Bio, Inc. ("RSF")***

In June 2021, RSF entered into a license agreement with Sanofi, as amended in March 2022, January 2023, and November 2025 (collectively, the "Sanofi License"), under which RSF received a worldwide, exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Sanofi know-how to exploit Ataciguat (also known as HMR1766) and pharmaceutical products containing Ataciguat ("Ataciguat Products") for all human and mammalian therapeutic, prophylactic and diagnostic uses (the "Sanofi License Field"). RSF became our wholly owned subsidiary in June 2024. Under the terms of the Sanofi License, we are required to use commercially reasonable efforts to develop Ataciguat Products in the Sanofi License Field in at least two indications, potentially including an orphan indication, in the U.S. and a certain number of

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major European countries, and to commercialize the Ataciguat Products in each country for which it has obtained regulatory approval.

As consideration for the rights granted to RSF by Sanofi, RSF made a non-refundable, non-creditable upfront cash payment totaling $525,000. If we succeed in developing and commercializing Ataciguat Products, we will be obligated to pay Sanofi up to an aggregate of $14.8 million in potential commercial milestone payments. We are also obligated to pay Sanofi tiered royalties ranging from low-single digit to mid-single digit percentages on worldwide annual net sales of Ataciguat Products by us and our affiliates and sublicensees. Our obligation to pay Sanofi royalties will expire on a Ataciguat Product-by-Ataciguat Product and country-by-country basis upon the latest to occur of (i) the expiration of the last to expire of certain issued patents or pending patents applications derived from the licensed Sanofi know-how controlled by us having claims covering such product in such country, (ii) the expiration of all regulatory exclusivities for such product in such country, and (iii) a specified anniversary following the first commercial sale of such product in such country. If we sublicense or assign our rights under the Sanofi License, we are also obligated to pay Sanofi a subteen percentage of certain non-royalty sublicense or transfer revenue, including upfront fees, milestone payments and fair value of equity of such sublicense issued to us.

Unless earlier terminated, the Sanofi License will expire on a Ataciguat Product-by-Ataciguat Product basis and country-by-country basis upon the expiration of the royalty term for such Ataciguat Product in such country, and in its entirety upon the expiration of all royalty terms. Either party may terminate Sanofi License in its entirety for the other party's material breach if such party fails to cure the breach, and Sanofi may terminate the Sanofi License in its entirety upon certain insolvency events involving RSF. Upon termination of the Sanofi License, all rights and licenses granted by Sanofi to us shall immediately terminate and automatically revert to Sanofi and, upon Sanofi's request, the parties shall negotiate in good faith a license or other transaction to provide Sanofi with exclusive rights under certain of our intellectual property to exploit Ataciguat worldwide in the License Field.

***Patent license and know-how agreement by and between Mayo Foundation for Medical Education and Research ("Mayo") and Rancho Santa Fe Bio, Inc.***

In December 2019, RSF entered into a license agreement with Mayo, as amended in May 2021, August 2023, March 2024, June 2024, and December 2025 (collectively, the "Mayo License"), under which RSF received (i) a worldwide, exclusive license with the right to sublicense (through multiple tiers) under certain Mayo patent rights, (ii) a nonexclusive license with the right to sublicense (through multiple tiers) to use certain know-how and materials, and (iii) a nonexclusive worldwide license, with the right to sublicense (through multiple tiers), subject to approval from Mayo, to use certain Mayo data, in each case in (i) through (iii), to develop, make, have made, use, offer for sale, sell, and import certain licensed products, including Ataciguat, for the prevention, diagnosis, and/or treatment of any and all human diseases and conditions. Our license is subject to customary reserved rights of the U.S. federal government owing to federal funding giving rise to inventions underlying the licensed patent rights and to Mayo's and its affiliates' reserved, irrevocable right to practice and have practiced the licensed patents for education and research clinical programs. We are obligated to use commercially reasonable efforts to bring licensed products to market, including by achieving certain development and regulatory milestones by certain corresponding deadlines set forth in the Mayo License.

RSF made a non-refundable, non-creditable upfront payment to Mayo in the form of shares of RSF common stock equal to 27.5% of fully diluted shares of RSF common stock. On March 11, 2024, RSF issued another 2,027,500 shares of RSF common stock to maintain the 27.5% ownership. In connection with our acquisition of RSF, on May 24, 2024, (i) RSF made a non-refundable, non-creditable payment to Mayo of $0.5 million upon RSF's change of control. We are also obligated to pay Mayo up to $0.3 million in development and regulatory milestone payments and up to $1.3 million in commercial milestone payments for each licensed product to

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achieve the corresponding milestone events. We are also obligated to pay Mayo royalties ranging from a mid-single digit to subteen percentage of worldwide annual net sales by us, our affiliates and sublicensees of licensed products. In the event that we are required to pay a non-affiliate third party certain consideration for a license under intellectual property rights owned or controlled by such non-affiliate third party that are required for the manufacture, use or sale of the licensed products, we can deduct a certain amount of such consideration from the royalty payments due to Mayo under the Mayo License, subject to a customary reduction floor. Our obligation to pay Mayo royalties for licensed products will expire upon the expiration date of the last to expire of the licensed patents or the last to expire regulatory exclusivity for a licensed product. Mayo is also eligible to receive a mid-double digit percentage of certain non-royalty sublicense income as well as a certain percentage of any consideration received by us for the sale or transfer of an FDA priority review voucher or similar transferrable asset.

Mayo may terminate the Mayo License in its entirety for material breach by us if we fail to cure the breach within a specified period, upon our insolvency, or immediately if we or any of our affiliates or sublicensees challenge the validity or enforceability of the licensed patents, subject to certain exceptions. Alternatively, if we fails to cure a material breach within the specified notice period, Mayo may, at its sole option, convert any or all exclusive licenses granted under the Mayo License to non-exclusive licenses. Upon termination of the Mayo License, all rights granted to us immediately revert to Mayo, and we must cease all use, development or commercialization of the licensed products (except that we may sell off our inventory of licensed products for a limited period, subject to certain conditions). Any sublicenses that we grant prior to termination of the Mayo License shall survive termination of the Mayo License by Mayo, and become a direct license of Mayo on substantially similar terms as such sublicensee's sublicense with us, provided that such sublicensee is not in material breach of its sublicense at the time of termination.

**Government regulation** 

Government authorities in the United States, at the federal, state and local level, and in other countries and jurisdictions, including the European Union ("EU"), extensively regulate, among other things, the research, development, testing, manufacturing, quality control, safety, effectiveness, approval, packaging, storage, recordkeeping, labeling, advertising, promotion, distribution, marketing, post-approval monitoring and reporting, and import and export of medical products, including pharmaceutical products and medical devices. The processes for obtaining regulatory clearances and approvals in the United States and in foreign countries and jurisdictions, along with subsequent compliance with applicable statutes and regulations, require the expenditure of substantial time and financial resources.

***Review and approval of drugs in the United States***

In the United States, the FDA regulates drugs under the U.S. Federal Food, Drug, and Cosmetic Act ("FDCA") and its implementing regulations. The failure to comply with applicable U.S. requirements at any time during the product development process, approval process or after approval may subject an applicant and/or sponsor to a variety of administrative or judicial sanctions, including refusal by the FDA to approve pending applications, withdrawal of an approval, imposition of a clinical hold, issuance of warning letters and other types of letters, product seizures, total or partial suspension of production or distribution, injunctions, fines, product recalls, and other post-market actions, refusals of government contracts, restitution, disgorgement of profits, or civil or criminal investigations and penalties brought by the FDA and the U.S. Department of Justice or other governmental entities.

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An applicant seeking approval to market and distribute a new drug product in the United States must typically undertake the following:

• completion of nonclinical, or preclinical, laboratory tests, animal studies and formulation studies, including certain
studies conducted in compliance with the FDA's good laboratory practice ("GLP") regulations;

• submission to the FDA of an investigational new drug application ("IND") which must take effect before human
clinical trials may begin;

• approval by an institutional review board ("IRB") representing each clinical site before each clinical trial
may be initiated at that site;

• performance of adequate and well-controlled human clinical trials in accordance with good clinical practices
("GCPs") to establish the safety and efficacy of the proposed drug product for each intended use;

• preparation and submission to the FDA of a New Drug Application ("NDA") and payment of user fees;

• a determination by the FDA within 60 days of its receipt of an NDA to file the NDA for review;

• review of the product by an FDA advisory committee, where appropriate or if applicable;

• satisfactory completion of one or more FDA inspections of the manufacturing facility or facilities at which the product, or
components thereof, are produced to assess compliance with current Good Manufacturing Practices ("cGMP") requirements and to assure that the facilities, methods and controls are adequate to preserve the product's identity,
strength, quality and purity;

• satisfactory completion of FDA audits of clinical trial sites to assure compliance with GCPs and the integrity of the
clinical data; and

• FDA review and approval of the NDA.

***Preclinical studies***

Before an applicant begins testing a compound in humans, the drug candidate enters the preclinical testing stage. Preclinical studies include, among other things, laboratory evaluation of the purity and stability of the manufactured drug substance or active pharmaceutical ingredient ("API") and the formulated drug or drug product, as well as *in vitro* and animal studies to assess the potential safety and activity of the drug for initial testing in humans and to establish a rationale for therapeutic use. The conduct of certain preclinical studies is subject to federal regulations and requirements, including GLP regulations. Some long-term preclinical testing, such as animal tests of reproductive adverse effects ("AEs") and carcinogenicity, may continue after the IND is submitted.

***The IND and IRB processes***

An IND is a request for FDA authorization to administer such investigational drug to humans. Such authorization must be secured prior to interstate shipment and administration of the investigational drug. In an IND, applicants must submit a protocol for each clinical trial and any subsequent protocol amendments. In addition, the results of the preclinical tests, manufacturing information, analytical data, any available clinical data or literature and plans for clinical trials, among other things, are submitted to the FDA as part of an IND. An IND must become effective before human clinical trials may begin. An IND automatically becomes effective 30 days after receipt by the FDA, unless before that time, the FDA raises concerns or questions related to one or more proposed clinical trials and places the trial on clinical hold. The FDA also may impose a clinical hold or partial clinical hold after commencement of a clinical trial under an IND. A clinical hold is an order issued by the

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FDA to the sponsor to delay a proposed clinical investigation or to suspend an ongoing investigation. A partial clinical hold is a delay or suspension of only part of the clinical work requested under the IND. No more than 30 days after imposition of a clinical hold or partial clinical hold, the FDA will provide the sponsor a written explanation of the basis for the hold. Following issuance of a clinical hold or partial clinical hold, an investigation (or full investigation in the case of a partial clinical hold) may only resume after the FDA has notified the sponsor that the investigation may proceed. The FDA will base that determination on information provided by the sponsor correcting the deficiencies previously cited or otherwise satisfying the FDA that the investigation can proceed.

A sponsor may choose, but is not required, to conduct a foreign clinical trial under an IND. When a foreign clinical trial is conducted under an IND, all FDA IND requirements must be met unless waived. When the foreign clinical trial is not conducted under an IND, for the FDA to accept data from such clinical trial in support of a marketing application, the sponsor must ensure that the study is conducted in accordance with GCP, among other things, including review and approval by an independent ethics committee and obtaining informed consent from subjects. The GCP requirements are intended to help ensure the protection of human subjects enrolled in non-IND foreign clinical trials, as well as the quality and integrity of the resulting data. FDA must also be able to validate the data from the study through an on-site inspection if necessary.

In addition to the foregoing IND requirements, an IRB representing each institution participating in the clinical trial must review and approve the plan for any clinical trial before it commences at that institution, and the IRB must conduct continuing review of the study at least annually. The IRB must review and approve, among other things, the study protocol and informed consent information to be provided to study subjects. An IRB must operate in compliance with FDA regulations. An IRB can suspend or terminate approval of a clinical trial at its institution, or an institution it represents, if the clinical trial is not being conducted in accordance with the IRB's requirements or if the product candidate has been associated with unexpected serious harm to patients.

Additionally, some trials are overseen by an independent group of qualified experts organized by the trial sponsor, known as a data safety monitoring board or committee. This group provides advice to the sponsor as to whether or not a trial may move forward at designated check points based on pre-specified criteria and access that only the group maintains to available data from the study. The FDA or the sponsor may suspend or terminate a clinical trial at any time on various grounds, including a finding that the research subjects are being exposed to an unacceptable health risk.

Information about certain clinical trials must be submitted within specific timeframes to the National Institutes of Health for public dissemination on its ClinicalTrials.gov website. Information related to the product, patient population, phase of investigation, study sites and investigators and other aspects of the clinical trial is made public as part of the registration of the clinical trial. Although sponsors are obligated to disclose the results of their clinical trials after completion, disclosure of the results can be delayed in some cases for up to two years after the date of completion of the trial. Failure to timely register a covered clinical study or to submit study results as provided for in the law can give rise to civil monetary penalties and also prevent the non-compliant party from receiving future grant funds from the federal government.

Expanded access, sometimes called "compassionate use," is the use of investigational products outside of clinical trials to treat patients with serious or immediately life-threatening diseases or conditions when there are no comparable or satisfactory alternative treatment options. The rules and regulations related to expanded access are intended to improve access to investigational products for patients who may benefit from investigational therapies. FDA regulations allow access to investigational products under an IND by the company or the treating physician for treatment purposes on a case-by-case basis for: individual patients (single-patient IND applications for treatment in emergency settings and non-emergency settings);

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intermediate-size patient populations; and larger populations for use of the investigational product under a treatment protocol or treatment IND application.

There is no obligation for a sponsor to make its drug products available for expanded access; however, as required by the 21st Century Cures Act ("Cures Act") passed in 2016, a sponsor must make its expanded access policy publicly available upon the earlier of initiation of a Phase 2 or Phase 3 trial; or 15 days after the investigational drug or biologic receives fast track, breakthrough or regenerative medicine advanced therapy designation.

***Human clinical trials in support of an NDA***

Clinical trials involve the administration of the investigational product to human subjects under the supervision of qualified investigators in accordance with GCP requirements, which include, among other things, the requirement that all research subjects, or their legal representative, provide their informed consent in writing before their participation in any clinical trial. Clinical trials are conducted under written study protocols detailing, among other things, the inclusion and exclusion criteria, the objectives of the study, the parameters to be used in monitoring safety and the effectiveness criteria to be evaluated.

Human clinical trials are typically conducted in three sequential phases, which may overlap or be combined:

• *Phase 1*. The product candidate is initially introduced into healthy human subjects or, in certain indications,
patients with the target disease or condition and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain an early indication of its effectiveness.

• *Phase 2*. The product candidate is administered to a limited patient population with the specified disease or
condition to identify possible AEs and safety risks, to preliminarily evaluate the efficacy of the product for specific targeted diseases or conditions and to determine dosage tolerance, dosing schedule and optimal dosage.

• *Phase 3*. The product candidate is administered to an expanded patient population, generally at geographically
dispersed clinical trial sites, in well-controlled clinical trials with the intent to further evaluate dosage, to provide statistically significant evidence of clinical efficacy and further test for safety, to generate adequate data to evaluate the
efficacy and safety of the product for approval, to establish the overall risk-benefit profile of the product candidate and to provide adequate information for the labeling of the product.

Post-approval studies, sometimes referred to as Phase 4 studies, may be conducted after initial regulatory approval. These studies are used to gain additional experience from the treatment of patients in the intended therapeutic indication. In certain instances, the FDA may mandate the performance of Phase 4 clinical trials as a condition of approval of an NDA.

During the development of a new drug, sponsors are given opportunities to meet with the FDA at certain points. These points may be prior to submission of an IND, at the end of Phase 2, and before an NDA is submitted. Meetings at other times may be requested. These meetings can provide an opportunity for the sponsor to share information about the data gathered to date, for the FDA to provide advice, and for the sponsor and the FDA to reach agreement on the next phase of development. Sponsors typically use the meetings at the end of the Phase 2 trial to discuss Phase 2 clinical results and present plans for the pivotal Phase 3 clinical trials that they believe will support approval of the new drug.

While the IND is active, progress reports detailing the results of the clinical trials, among other information, must be submitted at least annually to the FDA. In addition, within 15 calendar days after the sponsor determines that the information qualifies for reporting, IND safety reports must be submitted to the FDA for any of the following: serious and unexpected suspected adverse reactions; findings from other studies or animal

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or *in vitro* testing that suggest a significant risk in humans exposed to the drug; and any clinically important increase in the case of a serious suspected adverse reaction over that listed in the protocol or investigator brochure. The sponsor also must notify the FDA of any unexpected fatal or life-threatening suspected adverse reaction within seven calendar days after the sponsor's initial receipt of the information.

Concurrent with clinical trials, companies often complete additional animal studies and must also develop additional information about the chemistry and physical characteristics of the drug as well as finalize a process for manufacturing the product in commercial quantities in accordance with cGMP requirements. The manufacturing process must be capable of consistently producing quality batches of the drug candidate and, among other things, the applicant must develop methods for testing the identity, strength, quality, purity, and potency of the final drug. Additionally, appropriate packaging must be selected and tested and stability studies must be conducted to demonstrate that the drug candidate does not undergo unacceptable deterioration over its shelf life.

***Review of an NDA by the FDA***

Assuming successful completion of required clinical testing and other requirements, the results of the preclinical studies and clinical trials, together with detailed information relating to the product's chemistry, manufacture, controls and proposed labeling, among other things, are submitted to the FDA as part of an NDA requesting approval to market the drug product for one or more indications. Data may come from company-sponsored clinical trials intended to test the safety and effectiveness of a use of a product, or from a number of alternative sources, including studies initiated by investigators. To support marketing approval, the data submitted must be sufficient in quality and quantity to establish the safety and effectiveness of the investigational drug product to the satisfaction of the FDA. Under federal law, the submission of most NDAs is additionally subject to a significant application user fee as well as annual prescription drug product program fees. These fees are typically increased annually. Certain exceptions and waivers are available for some of these fees.

In addition, the Pediatric Research Equity Act ("PREA") requires a sponsor to conduct pediatric clinical trials for most drugs, for a new active ingredient, new indication, new dosage form, new dosing regimen or new route of administration. Under PREA, NDAs, and certain supplements must contain a pediatric assessment unless the sponsor has received a deferral or waiver. The required assessment must evaluate the safety and effectiveness of the product for the claimed indications in all relevant pediatric subpopulations and support dosing and administration for each pediatric subpopulation for which the product is deemed safe and effective. The sponsor or FDA may request a deferral of pediatric clinical trials for some or all of the pediatric subpopulations. A deferral may be granted for several reasons, including a finding that the product candidate is ready for approval for use in adults before pediatric clinical trials are complete or that additional safety or effectiveness data needs to be collected before any pediatric clinical trials begin. The FDA must send a non-compliance letter to any sponsor that fails to submit the required assessment, keep a deferral current or fails to submit a request for approval of a pediatric formulation.

The FDA conducts a preliminary review of an NDA within 60 days of its receipt, before accepting the NDA for filing, to determine whether the application is sufficiently complete to permit substantive review. The FDA may request additional information rather than accept an NDA for filing. In this event, the application must be resubmitted with the additional information. The resubmitted application is also subject to review before the FDA accepts it for filing. Once the submission is accepted for filing, the FDA begins an in-depth substantive review. The FDA reviews an NDA to determine, among other things, whether a product is safe and effective for its intended use and whether its manufacturing is cGMP compliant to assure and preserve the product's identity, strength, quality, and purity. Under the performance goals and policies implemented by the FDA under the Prescription Drug User Fee Act ("PDUFA"), the FDA has agreed to specified performance goals in the review

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process of NDAs. Applications for drugs containing new molecular entities are meant to be reviewed within 10 months from the date of filing, and applications for "priority review" products containing new molecular entities are meant to be reviewed within six months of filing. The review process may be extended by the FDA for three additional months if FDA requests or the applicant otherwise provides additional information or clarification regarding information already provided in the submission within the last three months before the PDUFA goal date or is otherwise deemed a "major amendment" to the application.

During its review of an NDA, the FDA typically will inspect the facility or facilities where the product is or will be manufactured. These pre-approval inspections may cover all facilities associated with an NDA, including drug component manufacturing (such as APIs), finished drug product manufacturing, and control testing laboratories. The FDA will not approve an NDA unless it determines that the manufacturing processes and facilities are in compliance with cGMP requirements and adequate to assure consistent production of the product within required specifications. In addition, the FDA will typically inspect one or more clinical sites to assure compliance with GCP and the integrity of the clinical data submitted.

In addition, as a condition of approval, the FDA may require an applicant to develop a risk evaluation and mitigation strategy ("REMS"). REMS use risk minimization strategies beyond the professional labeling to ensure that the benefits of the product outweigh the potential risks. To determine whether a REMS is needed, the FDA will consider the size of the population likely to use the product, seriousness of the disease, expected benefit of the product, expected duration of treatment, seriousness of known or potential AEs, and whether the product is a new molecular entity. REMS can include medication guides, physician communication plans for healthcare professionals, and elements to assure safe use ("ETASU"). ETASU may include, but are not limited to, special training or certification for prescribing or dispensing, dispensing only under certain circumstances, special monitoring, and the use of patient registries. The FDA may require a REMS before approval or post-approval if it becomes aware of a serious risk associated with use of the product.

The FDA is required to refer an application for a novel drug to an advisory committee or explain why such referral was not made. Typically, an advisory committee is a panel of independent experts, including clinicians and other scientific experts, that reviews, evaluates and provides a recommendation as to whether the application should be approved and under what conditions. The FDA is not bound by the recommendations of an advisory committee, but it considers such recommendations carefully when making decisions.

***Fast track, breakthrough therapy, and priority review***

The FDA has a number of programs intended to facilitate and expedite development and review of investigational drugs if they are intended to address an unmet medical need in the treatment of a serious or life-threatening disease or condition. Three of these programs are referred to as Fast Track Designation, Breakthrough Therapy Designation, and priority review designation.

The FDA may designate a product candidate for Fast Track review if it is intended, whether alone or in combination with one or more other products, for the treatment of a serious or life-threatening disease or condition, and it demonstrates the potential to address unmet medical needs for such disease or condition. For Fast Track product candidates, sponsors may have more frequent interactions with the FDA and the FDA may initiate review of sections of a Fast Track product candidate's application before the application is complete. This rolling review may be available if the FDA determines, after preliminary evaluation of clinical data submitted by the sponsor, that a Fast Track product candidate may be effective. The sponsor must also provide, and the FDA must approve, a schedule for the submission of the remaining information and the sponsor must pay applicable user fees upon submission of the first section of the NDA. However, the FDA's time period goal for reviewing a Fast Track application does not begin until the last section of the application is submitted. In addition, the Fast Track Designation may be withdrawn by the FDA if the FDA believes that the designation is no

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longer supported by data emerging in the clinical trial process. Any product submitted to the FDA for approval, including a product with a fast track designation, may also be eligible for other types of FDA programs intended to expedite development and review, such as breakthrough therapy, priority review and accelerated approval.

For example, a product candidate may be designated as a Breakthrough Therapy if it is intended, either alone or in combination with one or more other drugs products, to treat a serious or life-threatening disease or condition and preliminary clinical evidence indicates that the product candidate may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. Breakthrough Therapy Designation includes all of the benefits associated with Fast Track Designation, including the potential for rolling review of an NDA submission. In addition, the FDA may take certain actions with respect to Breakthrough Therapies, including holding meetings with the sponsor throughout the development process; providing timely advice to the product sponsor regarding development and approval; involving more senior staff in the review process; assigning a cross-disciplinary project lead for the review team; and taking other steps to design the clinical trials in an efficient manner.

The FDA may designate an NDA review for a priority review if it is for a product candidate that treats a serious or life-threatening disease or condition and, if approved, would provide a significant improvement in safety or effectiveness compared to available therapies. The FDA determines, on a case-by-case basis, whether the product candidate may represent a significant improvement when compared with other available therapies. Significant improvement may be illustrated, among other things, by evidence of increased effectiveness in the treatment of a condition, elimination or substantial reduction of a treatment-limiting product reaction, documented enhancement of patient compliance that may lead to improvement in serious outcomes, and evidence of safety and effectiveness in a new subpopulation. A priority designation is intended to direct overall attention and resources to the evaluation of such applications, and to shorten the FDA's goal for taking action on a marketing application from 10 months to six months.

Fast track designation, breakthrough therapy designation, and priority review do not change the standards for approval, but may expedite the development or approval process. Even if a product qualifies for one or more of these programs, the FDA may later decide that the product no longer meets the conditions for qualification or decide that the time period for FDA review or approval will not be shortened.

***Accelerated approval pathway***

The FDA may grant accelerated approval to a product candidate intended to treat a serious or life-threatening condition that provides meaningful therapeutic advantage to patients over existing treatments based upon a determination that the product candidate has an effect on a surrogate endpoint that is reasonably likely to predict clinical benefit or on an intermediate clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality ("IMM"), and that is reasonably likely to predict an effect on IMM or other clinical benefit, taking into account the severity, rarity, or prevalence of the condition and the availability or lack of alternative treatments. Products granted accelerated approval must meet the same statutory standards for safety and effectiveness as those granted traditional approval.

For the purposes of accelerated approval, a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign, or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. Surrogate endpoints can often be measured more easily or more rapidly than clinical endpoints. An intermediate clinical endpoint is a measurement of a therapeutic effect that is considered reasonably likely to predict the clinical benefit of a product, such as an effect on IMM. The FDA has limited experience with accelerated approvals based on intermediate clinical endpoints, but has indicated that such endpoints generally may support accelerated approval where the therapeutic effect measured by the endpoint

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is not itself a clinical benefit and basis for traditional approval, if there is a basis for concluding that the therapeutic effect is reasonably likely to predict the ultimate clinical benefit of a product.

The accelerated approval pathway is often used in settings in which the course of a disease is long and an extended period of time is required to measure the intended clinical benefit of a product, even if the effect on the surrogate or intermediate clinical endpoint occurs rapidly.

The accelerated approval pathway is typically contingent on a sponsor's agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to verify and describe the product's anticipated clinical benefit. As a result, a product candidate approved on this basis is subject to rigorous post-marketing compliance requirements, including the completion of Phase 4 or other post-approval clinical trials to verify and describe the anticipated the effect on the clinical endpoint. Under the Food and Drug Omnibus Reform Act of 2022 ("FDORA"), the FDA is permitted to require, as appropriate, that such trials be underway prior to approval or within a specific time period after the date of approval for a product granted accelerated approval. Sponsors are also required to send updates to the FDA every 180 days on the status of such studies, including progress toward enrollment targets, and the FDA must post this information publicly. Under FDORA, the FDA has increased authority for expedited procedures to withdraw approval of a drug or indication approved under accelerated approval if, for example, the sponsor fails to conduct such studies in a timely manner and send the necessary updates to the FDA, or if a confirmatory trial fails to verify the predicted clinical benefit of the product. In addition, the FDA generally requires, unless otherwise informed by the agency, pre-approval of promotional materials for product candidates approved under accelerated regulations, which could adversely impact the timing of the commercial launch of the product.

***Orphan drug designation and exclusivity***

Under the Orphan Drug Act, the FDA may grant Orphan designation to a drug or biologic intended to treat a rare disease or condition, which is a disease or condition that affects fewer than 200,000 individuals in the United States or, if it affects more than 200,000 individuals in the United States, there is no reasonable expectation that the cost of developing and making a drug product available in the United States for this type of disease or condition will be recovered from sales of the product. Orphan designation must be requested before submitting a BLA. After the FDA grants Orphan designation, the identity of the therapeutic agent and its potential orphan use are disclosed publicly by the FDA. Orphan designation does not convey any advantage in or shorten the duration of the regulatory review and approval process.

If a product that has Orphan designation subsequently receives the first FDA approval for the disease or condition for which it has such designation, the product is entitled to Orphan product exclusivity, which means that the FDA may not approve any other applications to market the same drug or biologic for the same approved use or indication within such rare disease or condition for seven years, except in limited circumstances, such as a showing of clinical superiority to the product with Orphan exclusivity or inability to manufacture the product in sufficient quantities of the Orphan drug to meet the needs of patients with the disease or condition for which the drug was designated. Orphan drug exclusivity does not prevent the FDA from approving a different drug or biologic for the same approved indication or use, or the same drug or biologic for a different indication or use. Among the other benefits of Orphan drug designation are tax credits for certain research and a waiver of the BLA application user fee.

A designated Orphan drug may not receive Orphan drug exclusivity if it is approved for a use that is broader than the disease or condition for which it received Orphan designation. In addition, Orphan drug exclusive marketing rights in the United States may be lost if the FDA later determines that the request for designation was materially defective or, as noted above, if a second applicant demonstrates that its product is clinically superior to the approved product with Orphan exclusivity within the relevant approved use or indication or the

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manufacturer of the approved product is unable to assure sufficient quantities of the product to meet the needs relating to the approved use or indication of patients with the relevant rare disease or condition.

***The FDA's decision on an NDA***

On the basis of the FDA's evaluation of the NDA and accompanying information, including the results of any inspections of the manufacturing facilities and select clinical trial sites, the FDA may issue an approval letter or a complete response letter. An approval letter authorizes commercial marketing of the product with specific prescribing information for specific indications. A complete response letter generally outlines the deficiencies in the submission and may require substantial additional testing or information in order for the FDA to reconsider the application. If a complete response letter is issued, the applicant may resubmit the NDA to address all of the deficiencies identified in the letter, withdraw the application, or request a hearing. If the applicant resubmits the NDA, the FDA will issue an approval letter only when the deficiencies have been addressed to the FDA's satisfaction. The FDA has committed to reviewing such resubmissions in two or six months depending on the type of information included. Even with submission of this additional information, the FDA ultimately may decide that the application does not satisfy the regulatory criteria for approval.

If the FDA approves a product, it may limit the approved indications for use for the product, require that contraindications, warnings or precautions be included in the product labeling, require that post-approval studies, including Phase 4 clinical trials, be conducted to further assess the drug's safety or effectiveness after approval, require testing and surveillance programs to monitor the product after commercialization, or impose other conditions, including distribution restrictions or other risk management mechanisms, including a REMS, which can materially affect the potential market and profitability of the product. The FDA may prevent or limit further marketing of a product based on the results of post-market studies or surveillance programs.

***Post-approval requirements***

Drugs manufactured or distributed pursuant to FDA approvals are subject to pervasive and continuing regulation by the FDA, including, among other things, requirements relating to recordkeeping, periodic reporting, product sampling and distribution, advertising and promotion, reporting of adverse experiences with the product and applicable product tracking and tracing requirements. After approval, many changes to the approved product, such as adding new indications or other labeling claims, are subject to prior FDA review and approval. There also are annual prescription drug product program fee requirements for certain marketed products.

In addition, drug manufacturers and other entities involved in the manufacture and distribution of approved drugs , and those supplying products, ingredients, and components of them are required to register their establishments with the FDA and state agencies, and are subject to periodic unannounced inspections by the FDA and these state agencies for compliance with cGMP requirements. Changes to the manufacturing process are strictly regulated and often require prior FDA approval before being implemented. FDA regulations also require investigation and correction of any deviations from cGMP and impose reporting and documentation requirements upon the NDA holder and any third-party manufacturers that the NDA holder may decide to use. Manufacturers and other parties involved in the drug supply chain for prescription drug products must also comply with product tracking and tracing requirements and notify the FDA of counterfeit, diverted, stolen, and intentionally adulterated products or products that are otherwise unfit for distribution in the United States. Accordingly, manufacturers must continue to expend time, money, and effort in the area of production and quality control to maintain cGMP compliance.

Once an approval is granted, the FDA may withdraw the approval if compliance with regulatory requirements and standards is not maintained or if problems occur after the product reaches the market. Later discovery of previously unknown problems with a product, including AEs of unanticipated severity or frequency, or with

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manufacturing processes, or failure to comply with regulatory requirements, may result in revisions to the approved labeling to add new safety information; imposition of post-market studies or clinical trials to assess new safety risks; or imposition of distribution or other restrictions under a REMS program. Other potential consequences include, among other things:

• restrictions on the marketing or manufacturing of the product, complete withdrawal of the product from the market or
voluntary product recalls;

• fines, warning or untitled letters or holds on post-approval clinical trials;

• refusal of the FDA to approve pending applications or supplements to approved applications, or suspension or revocation of
product approvals;

• product seizure or detention, or refusal to permit the import or export of products;

• consent decrees, corporate integrity agreements, debarment or exclusion from federal healthcare programs;

• mandated modification of promotional materials and labeling and the issuance of corrective information;

• the issuance of safety alerts, Dear Healthcare Provider letters, press releases and other communications containing
warnings or other safety information about the product; or

• injunctions or the imposition of civil or criminal penalties.

Discovery of previously unknown problems with a product, such as through post-marketing testing and product surveillance, or the failure to comply with applicable FDA requirements can have negative consequences, including adverse publicity, judicial or administrative enforcement, warning letters from the FDA, mandated corrective advertising or communications with doctors, and civil or criminal penalties, among others. Newly discovered or developed safety or effectiveness data may require changes to a product's approved labeling, including the addition of new warnings and contraindications, and also may require the implementation of other risk management measures.

The FDA strictly regulates marketing, labeling, advertising and promotion of products that are placed on the market. Drugs may be promoted only for the approved indications and in accordance with the provisions of the approved label. Failure to comply with these requirements can result in, among other things, adverse publicity, warning letters, corrective advertising and potential civil and criminal penalties. Physicians may prescribe, in their independent professional medical judgment, legally available products for uses that are not described in the product's labeling and that differ from those tested by us and approved by the FDA. Physicians may believe that such off-label uses are the best treatment for many patients in varied circumstances. The FDA does not regulate the behavior of physicians in their choice of treatments. The FDA does, however, restrict manufacturers' communications on the subject of off-label use of their products. The federal government has levied large civil and criminal fines against companies for alleged improper promotion of off-label use and has enjoined companies from engaging in off-label promotion. The FDA and other regulatory agencies have also required that companies enter into consent decrees or permanent injunctions under which specified promotional conduct is changed or curtailed. However, companies may share truthful and not misleading information that is otherwise consistent with a product's FDA approved labeling. The FDA and other agencies actively enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted off-label uses may be subject to significant liability.

In addition, the distribution of prescription pharmaceutical products is subject to the Prescription Drug Marketing Act ("PDMA"), which regulates the distribution of drugs and drug samples at the federal level, and sets minimum standards for the registration and regulation of drug distributors by the states. Both the PDMA

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and state laws limit the distribution of prescription pharmaceutical product samples and impose requirements to ensure accountability in distribution.

***Hatch-Waxman Amendments***

Section 505 of the FDCA describes three types of marketing applications that may be submitted to the FDA to request marketing authorization for a new drug. A Section 505(b)(1) NDA is an application that contains full reports of investigations of safety and efficacy. A 505(b)(2) NDA is an application that contains full reports of investigations of safety and efficacy but where at least some of the information required for approval comes from investigations that were not conducted by or for the applicant and for which the applicant has not obtained a right of reference or use from the person by or for whom the investigations were conducted. This regulatory pathway enables the applicant to rely, in part, on the FDA's prior findings of safety and efficacy for an existing product, or published literature, in support of its application. The FDA may also require companies to perform additional studies or measurements, including clinical trials, to support the change from the approved branded reference drug. The FDA may then approve the new product candidate for all, or some, of the labeled indications for which the branded reference drug has been approved, as well as for any new indication sought by the 505(b)(2) applicant. Section 505(j) establishes an abbreviated approval process for a generic version of approved drug products through the submission of an Abbreviated New Drug Application ("ANDA"). An ANDA provides for marketing of a generic drug product that has the same active ingredients, dosage form, strength, route of administration, labeling, performance characteristics and intended use, among other things, to a previously approved product, known as a reference listed drug ("RLD"). ANDAs are termed "abbreviated" because they are generally not required to include preclinical (animal) and clinical (human) data to establish safety and efficacy. Instead, generic applicants must scientifically demonstrate that their product is bioequivalent to, or performs in the same manner as, the innovator drug through *in vitro*, *in vivo*, or other testing. In certain situations, an applicant may obtain ANDA approval of a generic product with a strength or dosage form that differs from a referenced innovator drug pursuant to the filing and approval of an ANDA Suitability Petition. The FDA will approve the generic product as suitable for an ANDA application if it finds that the generic product does not raise new questions of safety and effectiveness as compared to the innovator product.

***Non-patent exclusivity***

Under the Hatch-Waxman Amendments, the FDA may not approve (or in some cases accept) an ANDA or 505(b)(2) application until any applicable period of non-patent exclusivity for the RLD has expired. The FDCA provides a period of five years of non-patent data exclusivity for a new drug containing a new chemical entity ("NCE"). For the purposes of this provision, an NCE is a drug that contains no active moiety that has previously been approved by the FDA in any other NDA. An active moiety is the molecule or ion responsible for the physiological or pharmacological action of the drug substance. In cases where such NCE exclusivity has been granted, an ANDA may not be filed with the FDA until the expiration of five years unless the submission is accompanied by a Paragraph IV certification, which states the proposed generic drug will not infringe one or more of the already approved product's listed patents or that such patents are invalid or unenforceable, in which case the applicant may submit its application four years following the original product approval.

The FDCA also provides for a period of three years of exclusivity for non-NCE drugs if the NDA or a supplement to the NDA includes reports of one or more new clinical investigations, other than bioavailability or bioequivalence studies, that were conducted by or for the applicant and are essential to the approval of the application or supplement. This three-year exclusivity period often protects changes to a previously approved drug product, such as a new dosage form, route of administration, combination or indication, but it generally would not protect the original, unmodified product from generic competition. Unlike five-year NCE exclusivity, an award of three-year exclusivity does not block the FDA from accepting ANDAs seeking approval for generic

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versions of the drug as of the date of approval of the original drug product; it only prevents FDA from approving such ANDAs.

A drug product can obtain pediatric market exclusivity in the United States. Pediatric exclusivity, if granted, adds six months to existing exclusivity periods for all formulations, dosage forms, and indications of the active moiety and to patent terms. This six-month exclusivity, which runs from the end of other exclusivity protection and patent term, may be granted based on the voluntary completion of a pediatric study in accordance with an FDA-issued "Written Request" for such a study, provided that at the time pediatric exclusivity is granted there is not less than nine months of term remaining.

***Hatch-Waxman patent certification and the 30-month stay***

In seeking approval of an NDA or a supplement thereto, NDA sponsors are required to list with the FDA each patent with claims that cover the applicant's product or an approved method of using the product. Upon approval of an NDA, each of the patents listed in the application for the drug is published in the FDA's Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the Orange Book. Upon submission of an ANDA or 505(b)(2) NDA, an applicant is required to certify to the FDA concerning any patents listed for the RLD in the Orange Book that:

• no patent information on the drug product that is the subject of the application has been submitted to the FDA;

• such patent has expired;

• the date on which such patent expires; or

• such patent is invalid, unenforceable or will not be infringed upon by the manufacture, use, or sale of the drug product
for which the application is submitted.

Generally, the ANDA or 505(b)(2) NDA cannot be approved until all listed patents have expired, except where the ANDA or 505(b)(2) NDA applicant challenges a listed patent through the last type of certification, also known as a paragraph IV certification. If the applicant does not challenge the listed patents or indicates that it is not seeking approval of a patented method of use, the ANDA or 505(b)(2) NDA application will not be approved until all of the listed patents claiming the referenced product have expired. If the ANDA or 505(b)(2) NDA applicant has provided a paragraph IV certification the applicant must send notice of the paragraph IV certification to the NDA and patent holders once the application has been accepted for filing by the FDA. The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the paragraph IV certification. If the paragraph IV certification is challenged by an NDA holder or the patent owner(s) asserts a patent challenge to the paragraph IV certification, the FDA may not approve that application until the earlier of 30 months from the receipt of the notice of the paragraph IV certification, the expiration of the patent, when the infringement case concerning each such patent was favorably decided in the applicant's favor or settled, or such shorter or longer period as may be ordered by a court. This prohibition is generally referred to as the 30-month stay. In instances where an ANDA or 505(b)(2) NDA applicant files a paragraph IV certification, the NDA holder or patent owner(s) regularly take action to trigger the 30-month stay, recognizing that the related patent litigation may take many months or years to resolve. Thus, approval of an ANDA or 505(b)(2) NDA could be delayed for a significant period of time depending on the patent certification the applicant makes and the reference drug sponsor's decision to initiate patent litigation. If the drug has NCE exclusivity and the ANDA is submitted four years after approval, the 30-month stay is extended so that it expires seven and a half years after approval of the innovator drug, unless the patent expires or there is a decision in the infringement case that is favorable to the ANDA applicant before then.

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***Patent term restoration and extension***

A patent claiming a new drug product may be eligible for a limited patent term extension under the Hatch-Waxman Amendments, which permits a patent term restoration of up to five years for patent term lost during product development and the FDA regulatory review. The restoration period granted is typically one-half the time between the effective date of an IND and the submission date of an NDA, plus the time between the submission date of an NDA and the ultimate approval date, provided the sponsor acted with diligence. Patent term restoration cannot be used to extend the remaining term of a patent past a total of 14 years from the product's approval date. Only one patent applicable to an approved drug product is eligible for the extension, and the application for the extension must be submitted prior to the expiration of the patent in question and within 60 days of drug approval. A patent that covers multiple drugs for which approval is sought can only be extended in connection with one of the approvals. The U.S. Patent and Trademark Office ("USPTO") reviews and approves the application for any patent term extension or restoration in consultation with the FDA.

***Regulation of medical devices in the United States***

Certain features of our Prolaio platform are regulated as medical devices by the FDA under the FDCA and its implementing regulations.

Under the FDCA, medical devices are classified into one of three classes—Class I, Class II or Class III—depending on the degree of risk associated with each medical device and the extent of control needed to provide reasonable assurances with respect to safety and effectiveness. Class I and II devices are subject to the premarket notification, or 510(k), process unless exempt. Class III devices must generally obtain FDA approval of a premarket approval ("PMA") application to be commercially distributed.

Some of our current products require the submission of a 510(k) and clearance by the FDA. To obtain 510(k) clearance, a company must submit a premarket notification demonstrating that the proposed device is "substantially equivalent" to a legally marketed device, known as a "predicate device." A predicate device is a legally marketed device that is not subject to premarket approval, i.e., a device that was legally marketed prior to May 28, 1976 (pre-amendments device) and for which a PMA is not required, a device that has been reclassified from Class III to Class II or I, or a device that was found substantially equivalent through the 510(k) process. A device is substantially equivalent if it has the same intended use and either the same technological characteristics or different technological characteristics that do not raise new questions of safety and effectiveness. The FDA aims to review and issue a determination on a premarket notification submission within 90 calendar days when such submission is considered to be under review by the FDA, though it often takes longer. The FDA may require additional information, including clinical data, to make a determination regarding substantial equivalence. In addition, FDA collects user fees for certain medical device submissions and annual fees and for medical device establishments. If the FDA agrees that the device is substantially equivalent, it will grant 510(k) clearance to market the device. If the FDA determines that the device is "not substantially equivalent" to a predicate device, it is designated as a Class III device, requiring more rigorous premarket review through the FDA's PMA pathway or through the FDA's De Novo classification process for novel medical devices that are low to moderate risk.

After receiving 510(k) clearance, any modification that could significantly affect the device's safety or effectiveness, or constitute a major change in its intended use, requires a new 510(k) clearance or PMA approval. The determination of whether a modification could significantly affect the device's safety or effectiveness is initially left to the manufacturer using available FDA guidance. Many minor modifications are documented by a "letter to file," but the FDA may review these letters and require the manufacturer to cease marketing and recall the modified device until clearance or approval, as appropriate, is obtained. Also, in these circumstances, the manufacturer may be subject to significant regulatory fines or penalties.

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Clinical trials are typically required to support a PMA or De Novo classification and sometimes a 510(k) submission. All clinical trials must be approved by and conducted under the oversight of an IRB for each site. Clinical investigators must obtain informed consent from all study subjects. Clinical trials can be suspended or terminated by the clinical trial sponsor, the FDA, or the IRB for various reasons, including risks outweighing benefits. Information about certain clinical trials must be submitted within specific timeframes to the National Institutes of Health for public dissemination on its ClinicalTrials.gov website.

All clinical investigations of devices must comply with the FDA's investigational device exemption ("IDE") regulations, which govern labeling, prohibit promotion, and specify recordkeeping, reporting, and monitoring responsibilities. Significant risk devices require an IDE application approved by the FDA before trials begin. Non-significant risk devices must still comply with abbreviated IDE requirements when conducting such trials including IRB approval. A significant risk device is one that presents a potential for serious risk to the health, safety or welfare of a patient and either is implanted, used in supporting or sustaining human life, substantially important in diagnosing, curing, mitigating or treating disease or otherwise preventing impairment of human health, or otherwise presents a potential for serious risk to a subject. An IDE application must be supported by appropriate data, such as animal and laboratory test results, showing that it is safe to test the device in humans and that the testing protocol is scientifically sound. The IDE will automatically become effective 30 days after receipt by the FDA unless the FDA notifies the company that the investigation may not begin. If the FDA determines that there are deficiencies or other concerns with an IDE for which it requires modification, the FDA may permit a clinical trial to proceed under a conditional approval.

Regardless of the degree of risk presented by the medical device, clinical studies must be approved by, and conducted under the oversight of, an Institutional Review Board ("IRB") for each clinical site. The IRB is responsible for the initial and continuing review of the IDE, and may impose additional requirements for the conduct of the study. If an IDE application is approved by the FDA and one or more IRBs, human clinical trials may begin at a specific number of investigational sites with a specific number of patients, as approved by the FDA. If the device presents a non-significant risk to the patient, a sponsor may begin the clinical trial after obtaining approval for the trial by one or more IRBs without separate approval from the FDA, but must still follow abbreviated IDE requirements, such as monitoring the investigation, ensuring that the investigators obtain informed consent, and complying with labeling and record-keeping requirements. In some cases, an IDE supplement must be submitted to, and approved by, the FDA before a sponsor or investigator may make a change to the investigational plan that may affect its scientific soundness, study plan or the rights, safety or welfare of human subjects.

During a study, the sponsor is required to comply with the applicable FDA requirements, including, for example, trial monitoring, selecting clinical investigators and providing them with the investigational plan, ensuring IRB review, adverse event reporting, record keeping and prohibitions on the promotion of investigational devices or on making safety or effectiveness claims for them. The clinical investigators in the clinical study are also subject to FDA's regulations and must obtain patient informed consent, rigorously follow the investigational plan and study protocol, control the disposition of the investigational device, and comply with all reporting and recordkeeping requirements. Additionally, after a trial begins, the sponsor, the FDA or the IRB could suspend or terminate a clinical trial at any time for various reasons, including a belief that the risks to study subjects outweigh the anticipated benefits.

After the FDA permits a device to enter commercial distribution, numerous and pervasive regulatory requirements continue to apply. These include:

• labeling and marketing regulations which require that promotion is truthful, not misleading, fairly balanced and provides
adequate directions for use and that all claims are substantiated;

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• complying with requirements for Unique Device Identifiers on devices and also requiring the submission of certain
information about each device to the FDA's Global Unique Device Identification Database;

• advertising and promotion requirements, including FDA prohibitions against the promotion of products for uncleared,
unapproved or off-label uses and FDA guidance on off-label dissemination of information and responding to unsolicited requests for information;

• restrictions on sale, distribution or use of a device;

• device establishment, registration and listing requirements and annual reporting requirements;

• approval or clearance of modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or
that would constitute a major change in intended use of one of our cleared devices;

• medical device reporting regulations, which require that manufacturers report to the FDA if their device may have caused or
contributed to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if the malfunction were to recur;

• medical device correction, removal and recall reporting regulations, which require that manufacturers report to the FDA
field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health;

• recall requirements, including a mandatory recall if there is a reasonable probability that the device would cause serious
adverse health consequences or death;

• an order of repair, replacement or refund;

• device tracking requirements; and

• post-market surveillance activities and regulations, which apply when necessary to protect the public health or to provide
additional safety and effectiveness data for the device.

Manufacturing processes for medical devices are also required to comply with the applicable portions of the Quality Management System Regulation ("QMSR"), which cover the methods and the facilities and controls for the design, manufacture, testing, production, processes, controls, quality assurance, labeling, packaging, distribution, installation and servicing of finished devices intended for human use. Manufacturers are subject to periodic scheduled and unscheduled inspections by the FDA. Failure to maintain compliance with the QMSR requirements could result in the shut-down of, or restrictions on, manufacturing operations and the recall or seizure of marketed products. The discovery of previously unknown problems with any marketed products, including unanticipated adverse events or adverse events of increasing severity or frequency, whether resulting from the use of the device within the scope of its clearance or approval, or off-label by a physician in the practice of medicine, could result in restrictions on the device, including the removal of the product from the market or voluntary or mandatory device recalls.

The FDA has broad post-market and regulatory enforcement powers. Medical device manufacturers are subject to unannounced inspections by the FDA and other state, local and foreign regulatory authorities to assess compliance with the QMSR and other applicable regulations, and these inspections may include the manufacturing facilities of any suppliers.

Failure to comply with applicable regulatory requirements can result in enforcement action by the FDA, which may include any of the following sanctions:

• warning letters, untitled letters, FDA Form 483s, fines, injunctions, consent decrees and civil penalties;

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• recall, withdrawals, or seizure of products;

• operating restrictions, partial suspension or total shutdown of production;

• the FDA's refusal or delay of requests for 510(k) clearance or premarket approval of new products, new intended uses
or modifications to existing products;

• withdrawing marketing authorizations that have already been granted or reclassifying the devices; and

• criminal prosecution.

***Review and approval of medicinal products in the European Union***

In order to market any product outside of the United States, a company must also comply with numerous and varying regulatory requirements of other countries and jurisdictions regarding quality, safety and efficacy, and governing, among other things, clinical trials, obtaining a marketing authorization ("MA"), commercial sales and distribution of products. Whether or not it obtains FDA approval for a product, an applicant will need to obtain the necessary approvals by the comparable foreign regulatory authorities before it can commence clinical trials or marketing of the product in those countries or jurisdictions. Specifically, the process governing approval of medicinal products in the EU generally follows similar lines as in the United States. It entails satisfactory completion of preclinical studies and adequate and well-controlled clinical trials to establish the safety and efficacy of the product for each proposed indication. It also requires the submission to the relevant competent authorities of an MA application ("MAA") and granting of an MA by these authorities before the product can be marketed and sold in the EU.

*Non-clinical studies and clinical trials* 

Similarly to the United States, the various phases of non-clinical and clinical research in the EU are subject to significant regulatory controls.

Non-clinical studies are performed to demonstrate the health or environmental safety of new chemical or biological substances. Non-clinical (pharmaco-toxicological) studies must be conducted in compliance with the principles of good laboratory practice ("GLP"), as set forth in EU Directive 2004/10/EC (unless otherwise justified for certain particular medicinal products, e.g., radio-pharmaceutical precursors for radio-labeling purposes). These GLP standards reflect the Organization for Economic Co-operation and Development requirements.

Clinical trials of medicinal products in the EU must be conducted in accordance with EU and national regulations and the International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human Use ("ICH"), guidelines on Good Clinical Practices ("GCP"), as well as the applicable regulatory requirements and the ethical principles that have their origin in the Declaration of Helsinki. If the sponsor of the clinical trial is not established within the EU, it must appoint an EU entity to act as its legal representative. The sponsor must take out a clinical trial insurance policy, and in most EU member states, the sponsor is liable to provide 'no fault' compensation to any study subject injured in the clinical trial.

The regulatory landscape related to clinical trials in the EU has been subject to recent changes. The EU Clinical Trials Regulation (Regulation (EU) No 536/2014) ("CTR"), which repealed the previous EU Clinical Trials Directive (2001/20/EC), became applicable on January 31, 2022. Unlike directives, the CTR is directly applicable in all EU member states without the need for member states to further implement it into national law. The CTR notably harmonizes the assessment and supervision processes for clinical trials throughout the EU via the Clinical Trials Information System ("CTIS"), which contains a centralized EU portal and database.

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While the EU Clinical Trials Directive required a separate clinical trial authorization application ("CTA") to be submitted in each member state in which the clinical trial takes place, to both the competent national health authority and an independent ethics committee, much like the FDA and IRB respectively, the CTR introduces a centralized process and only requires the submission of a single application for multi-center trials. The CTR allows sponsors to make a single submission to both the competent authority and an ethics committee in each member state, leading to a single decision per member state. The CTA must include, among other things, a copy of the trial protocol and an investigational medicinal product dossier containing information about the manufacture and quality of the medicinal product under investigation. The assessment procedure of the CTA has been harmonized as well, including a joint assessment by all member states concerned, and a separate assessment by each member state with respect to specific requirements related to its own territory, including ethics rules. Each member state's decision is communicated to the sponsor via CTIS. Once the CTA is approved, clinical study development may proceed.

The CTR transition period ended on January 31, 2025, and all clinical trials (and related applications) are now fully subject to the provisions of the CTR.

Medicines used in clinical trials must be manufactured in accordance with Good Manufacturing Practice ("GMP"). Other national and EU-wide regulatory requirements may also apply.

*Marketing authorization* 

In order to market our product candidates in the EU and many other foreign jurisdictions, we must obtain separate regulatory approvals. More concretely, in the EU, medicinal product candidates can only be commercialized after obtaining an MA. To obtain an MA, an applicant must submit an MAA either under a centralized procedure administered by the European Medicines Agency ("EMA") or one of the procedures administered by competent authorities in the EU member states (decentralized procedure or mutual recognition procedure) for obtaining an MA in multiple EU Member States.

"Centralized MAs" are issued by the European Commission through the centralized procedure based on the opinion of the Committee for Medicinal Products for Human Use ("CHMP") of the European Medicines Agency ("EMA") and are valid throughout the EU. Pursuant to Regulation (EC) No 726/2004, the centralized procedure is compulsory for specific products, including for (i) medicines produced by certain biotechnological processes, (ii) products designated as orphan medicinal products, (iii) advanced therapy medicinal products ("ATMPs") (gene therapy, somatic cell therapy and tissue-engineered products) and (iv) products with a new active substance indicated for the treatment of certain diseases, including products for the treatment of HIV, AIDS, cancer, diabetes, neurodegenerative diseases, auto-immune and other immune dysfunctions and viral diseases. The centralized procedure is optional for products containing a new active substance not yet authorized in the EU, or for products that constitute a significant therapeutic, scientific, or technical innovation or which are in the interest of public health in the EU.

Under the centralized procedure, the maximum timeframe for the evaluation of an MAA by the EMA is 210 days, excluding clock stops, when additional information or written or oral explanation is to be provided by the applicant in response to questions asked by the CHMP. Clock stops may extend the timeframe of evaluation of an MAA considerably beyond 210 days. Accelerated evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is of major interest from a public health perspective and in particular from the point of view of therapeutic innovation. If the CHMP accepts such request, the time limit of 210 days will be reduced to 150 days, excluding clock stops, but it is possible that the CHMP can revert to the standard time limit for the centralized procedure if it considers that it is no longer appropriate to conduct an accelerated assessment. At the end of this period, the CHMP provides a scientific opinion on whether or not a marketing authorization should be granted in relation to a medicinal product. Within 67 days from the date of the CHMP opinion, the European Commission will adopt its final decision on the MAA.

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"National MAs" are issued by the competent authorities of the EU member states, only cover their respective territory, and are available for product candidates not falling within the mandatory scope of the centralized procedure. Where a product has already been authorized for marketing in an EU member state, this national MA can be recognized in another member state through the mutual recognition procedure. If the product has not received a national MA in any member state at the time of application, it can be approved simultaneously in various member states through the decentralized procedure. Under the decentralized procedure an identical dossier is submitted to the competent authorities of each of the member states in which the MA is sought, one of which is selected by the applicant as the reference member state.

*Periods of authorization and renewals* 

A MA has an initial validity period of five years. The MA may be renewed after five years on the basis of a re-evaluation of the risk-benefit balance by the EMA or by the competent authority of the relevant EU member state for a nationally authorized product. To this end, the MA holder must provide the EMA or the competent authority with a consolidated version of the file in respect of quality, safety, and efficacy, including all variations introduced since the MA was granted, at least nine months before the MA ceases to be valid. Once renewed, the MA is valid for an unlimited period, unless the European Commission or the competent authorities of the relevant member states decide, on justified grounds relating to pharmacovigilance, to proceed with one further five year renewal period. Any authorization which is not followed by the actual placing of the medicinal product on the EU market (for centrally-authorized products) or on the market of the authorizing EU member state (for nationally-authorized products) within three years after authorization ceases to be valid (the so-called "sunset clause").

*Data and market exclusivity* 

In the EU, innovative medicinal products approved on the basis of a complete and independent data package generally receive eight years of data exclusivity and an additional two years of market exclusivity upon grant of an MA. The data exclusivity period prevents applicants for authorization of generics or biosimilars of these innovative products from referencing the innovator's preclinical and clinical trial data contained in the dossier of the reference product when applying for a generic or biosimilar (abbreviated) MA, for a period of eight years from the date on which the reference product was first authorized in the EU. During an additional two-year period of market exclusivity, a generic or biosimilar MAA can be submitted, and the innovator's data may be referenced, but no generic or biosimilar medicinal product can be placed on the EU market until the expiration of the market exclusivity. The overall 10-year period will be extended to a maximum of 11 years if, during the first eight years of those 10 years, the MA holder obtains an authorization for one or more new therapeutic indications which, during the scientific evaluation prior to their authorization, are held to bring a significant clinical benefit in comparison with existing therapies. There is no guarantee that a product will be considered by the EMA to be an innovative medicinal product, and products may not qualify for data exclusivity. Even if a product is considered to be an innovative medicinal product so that the innovator gains the prescribed period of data exclusivity, another company nevertheless could also market another version of the product if such company obtained an MA based on an MAA with a complete and independent data package of pharmaceutical tests, preclinical tests and clinical trials.

*Orphan medicinal products* 

The criteria for designating an "orphan medicinal product" in the EU are similar in principle to those in the United States. A medicinal product can be designated as an orphan if its sponsor can establish that: (1) the product is intended for the diagnosis, prevention, or treatment of a life-threatening or chronically debilitating condition, (2) either (i) such condition affects no more than five in ten thousand persons in the EU when the application is made, or (ii) without the benefits derived from orphan status, it is unlikely that the marketing of

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the product in the EU would generate sufficient return to justify the necessary investment in its development; (3) there exists no satisfactory method of diagnosis, prevention, or treatment of the condition in question that has been authorized in the EU or, if such method exists, the product would be of significant benefit to those affected by that condition.

An orphan designation provides a number of benefits, including fee reductions, regulatory assistance, and the possibility to apply for a centralized EU MA. Upon grant of an MA, orphan medicinal products are entitled to a ten-year period of market exclusivity, which means that the EMA and the competent authorities of the EU member states cannot accept another MAA, or grant an MA, or accept an application to extend an MA for a similar medicinal product for the same indication as the authorized orphan product for a period of ten years. A "similar medicinal product" is defined as a medicinal product containing a similar active substance or substances as contained in an authorized orphan medicinal product, and which is intended for the same therapeutic indication. The period of market exclusivity is extended by two years for orphan medicinal products that have also complied with an agreed pediatric investigation plan ("PIP"). No extension to any supplementary protection certificate ("SPC") can be granted on the basis of pediatric studies for orphan indications. Orphan designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process.

The orphan exclusivity period may be reduced to six years if, at the end of the fifth year, it is established that the product no longer meets the criteria for which it received orphan designation, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity or where the prevalence of the condition has increased above the threshold. Additionally, an MA may be granted to a similar product for the same indication as an authorized orphan product at any time if (i) a second applicant can establish that its product, although similar to the authorized orphan product, is safer, more effective or otherwise clinically superior; (ii) the MA holder for the authorized orphan product consents to a second medicinal product application; or (iii) the MA holder for the authorized product cannot supply enough orphan medicinal product.

*Pediatric development* 

Regulation (EC) No 1901/2006 provides that prior to obtaining an MA in the EU, applicants have to demonstrate compliance with all measures included in a PIP agreed with the EMA's Pediatric Committee ("PDCO"), and covering all subsets of the pediatric population, unless the PDCO has granted (1) a product-specific waiver, (2) a class waiver, or (3) a deferral for one or more of the measures included in the PIP. The PIP sets out the timing and measures proposed to generate data to support a pediatric indication of the product for which an MA is being sought. Products that are granted an MA with the results of the pediatric clinical trials conducted in accordance with the PIP are eligible for a six-month extension of the protection under a SPC provided an application for such extension is made at the same time as filing the SPC application for the product, or at any point up to two years before the SPC expires, even where the trial results are negative. In the case of orphan medicinal products, a two-year extension of the orphan market exclusivity may be available. This pediatric reward is subject to specific conditions and is not automatically available when data in compliance with the PIP are developed and submitted.

*Post-approval requirements* 

Similar to the United States, both MA holders and manufacturers of medicinal products are subject to comprehensive regulatory oversight by the EMA, the European Commission and/or the competent regulatory authorities of the member states. The holder of an MA must establish and maintain a pharmacovigilance system and appoint an individual qualified person for pharmacovigilance ("QPPV"), who is responsible for the establishment and maintenance of that system, and oversees the safety profiles of medicinal products and any

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emerging safety concerns. Key obligations include expedited reporting of suspected serious adverse reactions and submission of periodic safety update reports ("PSURs").

All new MAAs must include a risk management plan ("RMP"), describing the risk management system that the company will put in place and documenting measures to prevent or minimize the risks associated with the product.

The regulatory authorities may also impose specific obligations as a condition of the MA. Such risk- minimization measures or post-authorization obligations may include additional safety monitoring, more frequent submission of PSURs, or the conduct of additional clinical trials or post-authorization safety studies.

The advertising and promotion of medicinal products is also subject to laws concerning promotion of medicinal products, interactions with physicians, misleading and comparative advertising, and unfair commercial practices. All advertising and promotional activities for the product must be consistent with the approved summary of product characteristics, and therefore all off-label promotion is prohibited in the EU.

Direct-to-consumer advertising of prescription medicines is also prohibited in the EU. Although general requirements for advertising and promotion of medicinal products are established under EU directives, the details are governed by regulations in each member state and can differ from one country to another.

The aforementioned EU rules are generally applicable in the European Economic Area ("EEA"), which consists of the EU member states plus Norway, Liechtenstein, and Iceland.

Failure to comply with EU and member state laws that apply to the conduct of clinical trials, manufacturing approval, authorization of medicinal products and marketing of such products, both before and after grant of the MA, manufacturing of pharmaceutical products, statutory health insurance, bribery and anti-corruption, or with other applicable regulatory requirements may result in administrative, civil, or criminal penalties. These penalties could include delays or refusal to authorize the conduct of clinical trials, or to grant an MA, product withdrawals and recalls, product seizures, suspension, withdrawal or variation of the MA, total or partial suspension of production, distribution, manufacturing, or clinical trials, operating restrictions, injunctions, suspension of licenses, fines, and criminal penalties.

*Reform of the regulatory framework in the European Union* 

The EU pharmaceutical legislation is currently undergoing a complete review process, in the context of the Pharmaceutical Strategy for Europe initiative, launched by the European Commission in November 2020. The European Commission introduced legislative proposals in April 2023 that, if implemented, will replace the current regulatory framework in the European Union for all medicines (including those for rare diseases and for children). In April 2024, the European Parliament adopted its position on the legislative proposals and, in June 2025, the Council of the European Union adopted its position. A common position on the text was agreed upon on December 11, 2025, in the context of subsequent inter-institutional trilogue negotiations. The proposed revisions remain to be adopted into EU law, and are not expected to become applicable before 2028.

*Brexit and the regulatory framework in the United Kingdom* 

Following the end of the Brexit transition period on January 1, 2021 and the implementation of the Windsor Framework on January 1, 2025, the United Kingdom ("UK") is not generally subject to EU laws in respect of medicines. The EU laws that have been transposed into UK law through secondary legislation remain applicable in the UK however, new legislation such as the (EU) CTR is not generally applicable in the UK.

Under the Medicines and Medical Devices Act 2021, the Secretary of State or an 'appropriate authority' have delegated powers to amend or supplement existing regulations in the area of medicinal products and medical

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devices. This allows new rules to be introduced in the future by way of secondary legislation, which aims to allow flexibility in addressing regulatory gaps and future changes in the fields of human medicines, clinical trials, and medical devices.

As of January 1, 2021, the Medicines and Healthcare products Regulatory Agency ("MHRA") is the UK's standalone medicines and medical devices regulator. As a result of the Ireland/Northern Ireland Protocol, different rules applied in Northern Ireland than in England, Wales, and Scotland (together, "Great Britain", or GB) as Northern Ireland, which continued to follow the EU regulatory regime for a period following Brexit. However, on January 1, 2025 an arrangement called the "Windsor Framework" came into effect and reintegrated Northern Ireland under the regulatory authority of the MHRA with respect to medicinal products. The Windsor Framework removes EU licensing processes and EU labeling and serialization requirements in relation to Northern Ireland and introduces a UK-wide licensing process for medicines.

The UK regulatory framework in relation to clinical trials is governed by the Medicines for Human Use (Clinical Trials) Regulations 2004, as amended, which is derived from the now-repealed EU Clinical Trials Directive, as implemented into UK national law through secondary legislation. In April 2025, the UK introduced the Medicines for Human Use (Clinical Trials) (Amendment) Regulations. These changes, which will take full effect from April 2026, aim to create a streamlined, risk-proportionate system that accelerates approvals while maintaining robust safety standards.

In addition, in October 2023, the MHRA announced a new Notification Scheme for clinical trials which enables a more streamlined and risk-proportionate approach to initial clinical trial applications for Phase 4 and low-risk Phase 3 clinical trial applications.

MAs in the UK are governed by the Human Medicines Regulations (SI 2012/1916), as amended. In order to use the centralized procedure to obtain an MA that will be valid throughout the EEA, companies must be established in the EEA. Therefore, after Brexit, companies established in the UK can no longer use the EU centralized procedure and instead an EEA entity must hold any centralized MAs. In order to obtain a UK MA to commercialize products in the UK, an applicant must be established in the UK and must follow one of the UK national authorization procedures or one of the remaining post-Brexit international cooperation procedures. The MHRA has introduced changes to national licensing procedures, including procedures to prioritize access to new medicines that will benefit patients, a 150-day assessment (subject to clock-stops) and a rolling-review procedure. The rolling-review procedure permits the separate or joint submission of quality, non-clinical, and clinical data to the MHRA which can be reviewed on a rolling basis. After an application under the rolling- review procedure has been validated, the final decision should be received within 100 days (subject to clock- stops). In addition, since January 1, 2024, the MHRA may rely on the International Recognition Procedure ("IRP") when reviewing certain types of MAAs. Pursuant to the IRP, the MHRA will take into account the expertise and decision-making of trusted regulatory partners (e.g. the medicines regulatory authorities in Australia, Canada, Switzerland, Singapore, Japan, the U.S.A. and the EMA in the EU). The MHRA will conduct a targeted assessment of IRP applications but retain the authority to reject applications if the evidence provided is considered insufficiently robust. Applications are expected to be decided within a maximum of 60 days if there are no major objections identified that cannot be resolved within such 60-day period and the approval from the trusted regulatory partner has been granted within the previous two years. If any such major objections are identified or such approval has not been granted within the previous two years, then the relevant timeframe for the MHRA decision is up to 110 days. Applicants can submit initial MAAs to the IRP but the procedure can also be used throughout the lifecycle of a product for post-authorization procedures including line extensions, variations, and renewals.

In the UK, the initial duration of an MA is five years and following renewal will be valid for an unlimited period unless the MHRA decides on justified grounds relating to pharmacovigilance, to proceed with only one

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additional five-year renewal. Any authorization which is not followed by the actual placing of the medicine on the market in the UK within three (3) years shall cease to be in force.

There is no separate pre-MA orphan designation in the UK. Instead, the MHRA reviews applications for orphan designation in parallel to the corresponding MA application. The criteria are essentially the same, but have been tailored for the market, i.e., the prevalence of the condition in the UK, rather than the EU, must not be more than five in 10,000. Should an orphan designation be granted, the period or market exclusivity will be set from the date of first approval of the product in the UK.

***Review and approval of medical devices in the European Union***

The EU Medical Devices Regulation (EU) 2017/745 (the "EU MDR"), which repealed and replaced the previous EU Medical Devices Directive 93/42/EEC ("EU MDD"), governs the regulation of medical devices and in vitro diagnostic devices in the EU. The EU MDR imposes stricter pre-market and post-market requirements for the marketing and sale of medical devices than the EU MDD, including in the area of clinical evaluation requirements, quality systems and post-market surveillance. There is a transition period under the EU MDR until December 31, 2028 at the latest, during which certificates issued under the EU MDD remain valid, to ensure that there is sufficient time for devices to be re-certified subject to certain conditions (including compliance with requirements for market surveillance and quality management systems under the EU MDR, and engagement with notified bodies).

Under the EU MDR, there is currently no premarket government review of medical devices. However, all medical devices placed on the market in the EU must meet the relevant general safety and performance requirements laid down in Annex I to the EU MDR, including the requirement that a medical device must be designed and manufactured in such a way that, during normal conditions of use, it is suitable for its intended purpose. In addition, a medical device must be safe and effective and must not compromise the clinical condition or the safety of patients.

Compliance with the general safety and performance requirements is a prerequisite for European conformity marking ("CE mark"), without which medical devices cannot be marketed or sold in the EU. To demonstrate compliance with such general safety and performance requirements, medical device manufacturers must undergo a conformity assessment procedure, which varies according to the type of medical device and its (risk) classification. Demonstration of conformity with the general safety and performance requirements includes a clinical evaluation. Specifically, a manufacturer must demonstrate that the device achieves its intended performance during normal conditions of use, that the known and foreseeable risks, and any adverse events, are minimized and acceptable when weighed against the benefits of its intended performance, and that any claims made about the performance and safety of the device are supported by suitable evidence. Except for low-risk medical devices (Class I non-sterile, non-measuring devices), where the manufacturer can self-declare the conformity of its products with the general safety and performance requirements (except for any parts which relate to sterility or metrology), a conformity assessment procedure requires the intervention of a notified body. Notified bodies are independent organizations designated by EU member states to assess the conformity of devices before being placed on the market. A notified body would typically audit and examine a product's technical dossiers and the manufacturer's quality system. If satisfied that the relevant product conforms to the relevant essential requirements, the notified body issues a certificate of conformity, which the manufacturer uses as a basis for its own declaration of conformity. The manufacturer may then apply the CE mark to the device, which allows the device to be placed on the market throughout the EU.

Throughout the term of the certificate of conformity, the manufacturer will be subject to periodic surveillance audits to verify continued compliance with the applicable requirements. In particular, there will be a new audit by the notified body before it will renew the relevant certificate(s).

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All manufacturers placing medical devices on the market in the EU must comply with the EU medical device vigilance system. Under this system, serious incidents and Field Safety Corrective Actions ("FSCAs"), must be reported to the relevant authorities of the EU member states. An FSCA is defined as any corrective action for technical or medical reasons to prevent or reduce a risk of a serious incident associated with the use of a medical device that is made available on the market. An FSCA may include the recall, modification, exchange, destruction or retrofitting of the device. Manufacturers are required to have a system in place for the recording and reporting of incidents and FSCAs in compliance with the EU MDR.

The aforementioned EU rules are generally applicable in the EEA, which consists of the 27 EU member states plus Norway, Liechtenstein and Iceland.

***Rest of the world regulation***

For other countries outside of the United States, such as those in Europe, Latin America, or Asia, the requirements governing product development, the conduct of clinical trials, product marketing, product licensing, pricing and reimbursement can vary from country to country. Failure to comply with applicable foreign regulatory requirements may subject sponsors, manufacturers, or marketers of pharmaceutical products to, among other things, fines, suspension, or withdrawal of regulatory authorizations and approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

***Other healthcare laws***

Our business operations and current and future arrangements with investigators, healthcare professionals, consultants, third-party payors, patient organizations and customers may expose us to broadly applicable fraud and abuse and other healthcare laws and regulations. The laws that may affect our ability to operate, and our proposed sales, marketing, and distribution strategies, include, but are not limited to the following:

• The federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting,
receiving, offering or paying any remuneration (including any kickback, bribe, or rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce, or in return for, either the referral of an individual, or the purchase, lease,
order or recommendation of any good, facility, item or service for which payment may be made, in whole or in part, under a federal healthcare program, such as the Medicare and Medicaid programs. A person or entity does not need to have actual
knowledge of the statute or specific intent to violate it in order to have committed a violation. Violations are subject to civil and criminal fines and penalties for each violation, plus up to three times the remuneration involved, imprisonment,
and exclusion from government healthcare programs.

• Federal civil and criminal false claims laws, including the federal False Claims Act ("FCA") and civil monetary
penalty laws, which impose criminal and civil penalties against individuals or entities for, among other things, knowingly presenting, or causing to be presented, claims for payment or approval from Medicare, Medicaid or other federal health care
programs that are false or fraudulent; knowingly making or causing a false statement material to a false or fraudulent claim or an obligation to pay money to the federal government; or knowingly concealing or knowingly and improperly avoiding or
decreasing such an obligation. Manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to "cause" the submission of false or fraudulent claims. In addition, the
government may assert that a claim including items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the FCA. The FCA also permits a private individual acting as a
"whistleblower" to bring actions on behalf of the federal government alleging violations of the FCA and to share in any monetary recovery.

• The federal Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), which established federal
criminal statutes that prohibit knowingly and willfully executing, or attempting to execute, a scheme to

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defraud any healthcare benefit program or obtain, by means of false or fraudulent pretenses, representations or promises, any of the money or property owned by, or under the custody or control of, any healthcare benefit program, regardless of the payor (e.g., public or private) and knowingly and willfully falsifying, concealing or covering up by any trick or device a material fact or making any materially false statements in connection with the delivery of, or payment for, healthcare benefits, items or services relating to healthcare matters. Similar to the federal Anti-Kickback Statute, a person or entity can be found guilty of violating these statutes without actual knowledge of the statutes or specific intent to violate them. <br>

• The federal Physician Payments Sunshine Act, created under the Patient Protection and Affordable Care Act, as amended by
the Health Care and Education Reconciliation Act (collectively, the "ACA") and its implementing regulations requires manufacturers of drugs, devices, biologicals and medical supplies for which payment is available under Medicare,
Medicaid or the Children's Health Insurance Program (with certain exceptions) to report annually to the Department of Health and Human Services ("HHS") information related to payments or other transfers of value made to physicians
(defined to include doctors, dentists, optometrists, podiatrists and chiropractors), certain other licensed healthcare professionals (physician assistants, nurse practitioners, clinical nurse specialists, anesthesiologist assistants, certified
registered nurse anesthetists, and certified nurse midwives), and teaching hospitals, as well as ownership and investment interests held by physicians and their immediate family members.

• Federal government price reporting laws, which require manufacturers to calculate and report complex pricing metrics in an
accurate and timely manner to government programs.

• Federal consumer protection and unfair competition laws, which broadly regulate marketplace activities and activities that
potentially harm consumers.

• Analogous state and foreign laws and regulations, such as state and foreign anti-kickback, false claims, consumer
protection and unfair competition laws which may apply to pharmaceutical and device manufacturers' business practices, including but not limited to, research, distribution, sales, and marketing arrangements as well as submitting claims
involving healthcare items or services reimbursed by any third-party payor, including commercial insurers; state laws that require pharmaceutical and medical device companies to comply with the industry's voluntary compliance guidelines and
the relevant compliance guidance promulgated by the federal government that otherwise restricts payments that may be made to healthcare providers and other potential referral sources; state laws that require manufacturers to file reports with states
regarding pricing and marketing information, such as the tracking and reporting of gifts, compensations and other remuneration and items of value provided to healthcare professionals and entities; and state and local laws requiring the registration
of pharmaceutical and medical device sales representatives.

Federal, state, and foreign enforcement bodies are continuing to increase their scrutiny of interactions between healthcare companies and healthcare providers, which has led to a number of investigations, prosecutions, convictions, and settlements in the healthcare industry. Violation of any of such laws or any other governmental regulations that apply may result in, significant penalties, including, without limitation, administrative, civil, and criminal penalties, damages, fines, disgorgement, contractual damages, the curtailment or restructuring of operations, integrity oversight and reporting obligations, exclusion from participation in federal and state healthcare programs, reputational harm, diminished profits and future earnings, and individual imprisonment.

***Privacy and data security***

In the ordinary course of business, we and the third parties upon which we rely collect, receive, store, or otherwise process personal data, including information we may collect about participants in our clinical trials. This personal data can also include data that is considered "sensitive" personal data under privacy laws,

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policies, or agreements to which we are subject. Accordingly, we are, or may be become, subject to numerous, evolving privacy and data security obligations, including global, federal, state, and local laws, regulations, guidance, industry standards, external and internal privacy and security policies, contractual requirements, and other obligations related to privacy and data security.

These privacy and data security laws are evolving and may impose potentially conflicting obligations. Such obligations may include, without limitation, federal health information privacy laws, state information security and data breach notification laws, state health information privacy laws, and federal and state consumer protection laws (e.g., the FTC Act). Through our acquisition of Prolaio, we have acquired an FDA-cleared patient data collection software platform, which we use to enhance data collection and analysis in our clinical trials, with a large curated cardiovascular clinical data set. While we currently use Prolaio's platform solely for clinical research purposes and not to provide services to external healthcare providers, we remain subject to various privacy and data security requirements applicable to the collection, use, storage, and disclosure of patient health information. To the extent we obtain protected health information ("PHI") from covered entities under the Health Insurance Portability and Accountability Act of 1996 ("HIPAA"), we may be required to enter into data use agreements or business associate agreements and comply with applicable requirements for the use and disclosure of such information, including requirements related to de-identification, limited data sets, and appropriate safeguards.

Beyond HIPAA, our collection, use, and maintenance of large-scale patient health data through Prolaio's platform subjects us to scrutiny under Section 5 of the FTC Act, which prohibits unfair or deceptive acts or practices. The FTC has authority to bring enforcement actions for privacy and data security practices that it deems unfair or deceptive, including actions related to the failure to maintain reasonable and appropriate data security measures, failure to comply with posted privacy policies, and deceptive statements regarding data practices. The FTC expects companies that collect, maintain, or use sensitive personal information, including individually identifiable health information, to implement data security measures that are reasonable and appropriate in light of the sensitivity and volume of the information held, the size and complexity of the business, and the cost of available tools to improve security and reduce vulnerabilities. The FTC has brought numerous enforcement actions against companies for inadequate security practices involving health data, resulting in consent decrees requiring comprehensive security programs, third-party audits, civil penalties, and injunctive relief. Additionally, the FTC's Health Breach Notification Rule requires vendors of personal health records and related entities that are not covered by HIPAA to notify consumers, the FTC, and in some cases the media, of breaches of unsecured identifiable health information. State consumer protection laws enforced by state attorneys general impose similar requirements and provide additional bases for enforcement actions related to our data practices.

At the state level, numerous U.S. states have enacted comprehensive privacy laws that impose certain obligations on covered businesses, including providing specific disclosures in privacy notices and affording individuals certain rights concerning their personal data. Similar laws are being considered in several other states, as well as at the federal and local levels, and we expect more states to pass similar laws in the future. Additionally, a smaller number of states have passed or are considering laws governing the privacy of consumer health data. While existing state consumer privacy laws provide exemptions for data processed in the context of clinical trials, the continued development of complex requirements at the state level may further complicate compliance efforts and may impact our business activities, including our identification of research subjects, relationships with business partners and ultimately the marketing and distribution of our products, and are examples of the increasingly stringent and evolving regulatory frameworks related to personal data processing, as more fully discussed in the section titled "*Risk Factors*."

Additionally, to the extent we collect personal data outside of the United States, through clinical trials or otherwise, we are, or may become, subject to foreign data and data security laws, such as the European Union's

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General Data Protection Regulation 2016/679 ("EU GDPR") and other national data protection legislation in force in relevant EEA Member States, and the EU GDPR as it forms part UK law by virtue of section 3 of the European Union (Withdrawal) Act 2018 ("UK GDPR"). Foreign privacy and data security laws impose significant and complex compliance obligations on entities that are subject to those laws and may impose significant sanctions for non-compliance (including fines of up to the greater of 20 million Euros (17.5 million GBP for the UK) or 4% of worldwide annual revenue), as more fully discussed in the section titled "*Risk Factors.*"

***Coverage and reimbursement***

In the United States and markets in other countries, patients who are prescribed treatments for their conditions and providers performing the prescribed services generally rely on third-party payors to reimburse all or part of the costs associated with their prescription. Therefore, adequate coverage and reimbursement from such third-party payors are critical to new and ongoing product acceptance. Thus, even if a product candidate is approved, sales of the product will depend, in part, on the extent to which third-party payors, including government health programs in the United States such as Medicare and Medicaid, commercial health insurers and managed care organizations, provide coverage, and establish adequate reimbursement levels for, the product. Factors payors consider in determining coverage and reimbursement are based on whether the product is:

• a covered benefit under its health plan;

• safe, effective and medically necessary;

• appropriate for the specific patient;

• cost-effective; and

• neither experimental nor investigational.

In the United States, no uniform policy of coverage and reimbursement for drug products exists among third-party payors. Therefore, coverage and reimbursement for drug products can differ significantly from payor to payor. The process for determining whether a third-party payor will provide coverage for a product may be separate from the process for setting the price or reimbursement rate that the payor will pay for the product once coverage is approved. A third-party payor's decision to provide coverage for a product does not imply that an adequate reimbursement rate will be approved. Therefore, even if coverage is provided, the approved reimbursement amount may not be high enough to allow us to establish or maintain pricing sufficient to realize a return on our investment. Further, one payor's determination to provide coverage for a product does not assure that other payors will also provide coverage and reimbursement for the product, and the level of coverage and reimbursement can differ significantly from payor to payor.

Third-party payors are increasingly challenging the prices charged, examining the medical necessity, and reviewing the cost- effectiveness of medical products and services and imposing controls to manage costs.

There may be significant delays in obtaining coverage and reimbursement, as the process of determining coverage and reimbursement is often time consuming and costly. In order to secure coverage and reimbursement for any product that might be approved for sale, a company may need to conduct expensive pharmacoeconomic studies in order to demonstrate the medical necessity and cost-effectiveness of the product, in addition to the costs required to obtain FDA or other comparable regulatory approvals. Moreover, coverage may be more limited than the purposes for which the product is approved by FDA or regulatory authorities in other countries.

Additionally, companies may also need to provide discounts to purchasers, private health plans, or government healthcare programs. Third-party payors may limit coverage to specific products on an approved list, also known as a formulary, which might not include all of the approved products for a particular indication. Third-party payors could determine that our product candidates are not medically necessary or cost effective. A

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decision by a third-party payor not to cover a product could reduce physician utilization once the product is approved and have a material adverse effect on sales, results of operations and our financial condition.

The containment of healthcare costs has become a priority of federal, state, and foreign governments, and the prices of products have been a focus in this effort. There have been a number of federal and state proposals during the last few years regarding the pricing of pharmaceutical products, limiting coverage and the amount of reimbursement for drugs and other medical products, government control, and other changes to the healthcare system in the United States including the relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States. Governments have shown significant interest in implementing cost-containment programs, including price controls, restrictions on reimbursement, and requirements for substitution of generic products. Net prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs or private payors and by any future relaxation of laws that presently restrict imports of drugs from countries where they may be sold at lower prices than in the United States.

Further, third-party payors are increasingly reducing reimbursements for drugs and services and implementing measures to control utilization of drugs (such as requiring prior authorization or step therapy for coverage, among other things). Increasingly, third-party payors are requiring that drug companies provide them with predetermined discounts from list prices and are challenging the prices charged for medical products. We cannot be sure that reimbursement will be available for any product candidate that we commercialize and, if reimbursement is available, the level of reimbursement. Even if favorable coverage and reimbursement status is attained for one or more products for which we receive regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. Moreover, payment methodologies may be subject to changes in healthcare legislation and regulatory initiatives. For example, the U.S. Centers for Medicare & Medicaid Services ("CMS") may develop new payment and delivery models, such as bundled payment models. In addition, recently there has been heightened governmental scrutiny over the manner in which manufacturers set prices for their commercial products, which has resulted in several U.S. Congressional inquiries and proposed and enacted state and federal legislation designed to, among other things, bring more transparency to product pricing, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for pharmaceutical products. Congress has indicated that it will continue to seek new legislative measures to control drug costs.

In addition, many pharmaceutical manufacturers must calculate and report certain price reporting metrics to the government, such as average sales price ("ASP") and best price. Penalties may apply in some cases when such metrics are not submitted accurately and timely. Further, these prices for drugs may be reduced by mandatory discounts or rebates required by government healthcare programs. Adoption of price controls and cost-containment measures, including measures requiring most-favored nation pricing for drugs in the United States or policies mandating price negotiation, such as the Medicare drug price negotiation program, and adoption of more restrictive policies in jurisdictions with existing controls and measures, could further limit a company's revenue generated from the sale of any approved products.

Outside the United States, ensuring coverage and adequate payment for a product also involves challenges. Pricing of prescription pharmaceuticals is subject to government control in many countries. Pricing negotiations with government authorities can extend well beyond the receipt of regulatory approval for a product and may require a clinical trial that compares the cost-effectiveness of a product to other available therapies. The conduct of such a clinical trial could be expensive and result in delays in commercialization.

In the EU, pricing and reimbursement schemes vary widely from country to country. Some countries provide that products may be marketed only after a reimbursement price has been agreed. Some countries may require the completion of additional studies that compare the cost-effectiveness of a particular product candidate to

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currently available therapies or so-called health technology assessments, in order to obtain reimbursement or pricing approval. For example, the EU member states have the option to restrict the range of products for which their national health insurance systems provide reimbursement and to control the prices of medicinal products for human use. EU member states may approve a specific price for a product or it may instead adopt a system of direct or indirect controls on the profitability of the company placing the product on the market. Other EU member states allow companies to fix their own prices for products but monitor and control prescription volumes and issue guidance to physicians to limit prescriptions. Recently, many countries in the EU have increased the amount of discounts required on pharmaceuticals and these efforts could continue as countries attempt to manage healthcare expenditures, especially in light of the severe fiscal and debt crises experienced by many countries in the EU. The downward pressure on healthcare costs in general, particularly prescription products, has become intense. As a result, increasingly high barriers are being erected to the entry of new products. Political, economic and regulatory developments may further complicate pricing negotiations, and pricing negotiations may continue after reimbursement has been obtained. Reference pricing used by various EU member states, and parallel trade, i.e., arbitrage between low-priced and high-priced EU member states, can further reduce prices. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements for any products, if approved in those countries.

***Current and future healthcare reform***

In the United States, there have been, and continue to be, a number of legislative and regulatory changes to the healthcare system that could impact our ability to sell our products profitably. For example, in March 2010, the ACA was enacted, which substantially changed the way healthcare is financed by both governmental and private insurers, and significantly affected the pharmaceutical industry. The ACA contained a number of provisions, including those governing enrollment in federal healthcare programs, reimbursement adjustments and changes to fraud and abuse laws. For example, the ACA, among other things:

• increased the minimum level of Medicaid rebates payable by manufacturers of brand name drugs from 15.1% to 23.1% of the
average manufacturer price;

• required collection of rebates for drugs paid by Medicaid managed care organizations; and

• imposed a non-deductible annual fee on pharmaceutical manufacturers or importers
who sell "branded prescription drugs" to specified federal government programs.

Since its enactment, there have been judicial, administrative, executive, and legislative challenges to certain aspects of the ACA as well as executive orders related to the ACA's implementation. It is unclear how healthcare reform measures of the current presidential administration or other efforts, if any, to challenge repeal or replace the ACA, will impact our business.

In addition, other legislative changes have been proposed and adopted in the United States since the ACA was enacted. These changes included aggregate reductions to Medicare payments to providers and health plans (including Part D prescription drug plans) through 2032, unless Congress takes additional action. The American Taxpayer Relief Act of 2012, which, among other things, reduced Medicare payments to several providers, and increased the statute of limitations period for the government to recover overpayments to providers from three to five years. The One Big Beautiful Bill Act, which was enacted in July 2025, imposes significant reductions in the funding of the Medicaid program. Such reductions are expected to decrease the number of persons enrolled in Medicaid and reduce the services covered by Medicaid. These new laws and regulatory changes may result in additional reductions in Medicare and other healthcare funding, which could have a material adverse effect on prescribers of our drugs, if approved, and accordingly, our financial operations.

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There has been increasing legislative and enforcement interest in the United States with respect to drug pricing practices. Specifically, there have been several recent U.S. Congressional inquiries and proposed federal and state legislation designed to, among other things, bring more transparency to drug pricing, reduce the cost of prescription drugs under Medicare, review the relationship between pricing and manufacturer patient programs, and reform government program reimbursement methodologies for drugs. For example, as of January 1, 2024, the American Rescue Plan Act of 2021 eliminated the statutory cap on drug manufacturers' Medicaid drug rebate liability of 100% of a drug's average manufacturer price, for single source and innovator multiple source drugs. The Inflation Reduction Act of 2022 ("IRA"), among other things, directed HHS to negotiate the price of certain high-expenditure, single- source drugs and biologics covered under Medicare, and created civil monetary penalties and an excise tax for manufacturers that fail to comply with the drug price negotiation requirements. The IRA also imposed rebates for certain drugs and biologics covered under Medicare Part B or Medicare Part D to penalize price increases that outpace inflation, and, beginning in 2025, replaced the Part D coverage gap discount program with a new discounting program. The IRA permits HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial years. HHS has completed two rounds of negotiation, covering 25 drugs, and has announced the third set of 15 drugs to be subject to negotiation. The Medicare drug price negotiation program is currently subject to multiple legal challenges. The impact of these challenges, as well as any other future challenges, is uncertain, and it is unclear how the IRA will be implemented but is likely to have a significant impact on the pharmaceutical industry.

The costs of prescription pharmaceuticals have also been the subject of considerable discussion in the United States. To date, there have been several recent U.S. congressional inquiries, as well as proposed and enacted federal and state legislation designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the costs of drugs under Medicare and reform government program reimbursement methodologies for drug products. The Trump Administration has issued executive orders and supported proposed regulatory initiatives in 2025 that could have a significant impact on the prices that we, or any collaborators, may receive for any approved products.

On May 12, 2025, President Trump signed an executive order directing the Secretary of HHS to set and communicate most-favored-nation ("MFN") price targets to manufacturers and propose a rulemaking plan to impose MFN pricing if "significant progress" is not made, and also directing the federal government to support regulatory paths to allow direct-to-patient sales for companies that meet these targets. The executive order further states that the Administration will take additional action (for example, examining whether marketing approvals should be modified or rescinded or considering individual drug importation waiver authorities) should manufacturers fail to offer American consumers the MFN lowest price. In July 2025, President Trump sent letters to certain pharmaceutical companies demanding that these companies extend MFN pricing to Medicaid and newly launched drugs as well as move to direct-to-consumer models priced at MFN pricing, and soliciting binding commitments by September 29, 2025. Since this time, multiple drug manufacturers have announced plans to, for certain of their drugs, lower prices to reflect similar pricing around the world, and to sell these reduced-price drugs on a direct-to-consumer purchasing platform developed by the federal government; however, it is not known what results will occur to the extent the recipients of these letters do not reduce their U.S. prices.

On December 19, 2025, CMS released two proposed rules that would incorporate MFN pricing principles into federal reimbursement for prescription drugs. The first proposal, the Global Benchmark for Efficient Drug Pricing Model ("GLOBE") for Medicare Part B, would require manufacturers of specified single source drugs and sole source biologics to pay incremental rebates based on international benchmark prices, with participation triggered for products meeting CMS's spending and eligibility criteria. The second proposal, the Guarding U.S. Medicare Against Rising Drug Costs ("GUARD") model for Medicare Part D, would similarly mandate manufacturer rebates for qualifying sole source drugs where the Medicare net price exceeds an MFN

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benchmark derived from international reference pricing methodologies. As proposed, GLOBE would begin a five year performance period on October 1, 2026 and GUARD would begin its performance period in 2027. These proposals will likely be subject to legal challenges that could delay their implementation or modify their impact on manufacturer pricing and revenue. Additionally, in November 2025, CMS introduced the GENErating cost Reductions fOr U.S. Medicaid ("GENEROUS") Model, a voluntary MFN framework for manufacturers participating in the Medicaid Drug Rebate Program. Although it is voluntary, the GENEROUS Model could also impact the drug pricing landscape for manufacturers.

Further, the White House in January 2026 released the "Great Healthcare Plan," calling for Congress to codify the Trump Administration's MFN drug-pricing deals (including to extend the results of recent voluntary negotiations following the May 2025 executive order), and also proposing measures that could affect pharmaceutical pricing and utilization dynamics more broadly, including expanding over-the-counter availability for certain verified-safe drugs and additional PBM/health insurance transparency and subsidy reforms. Any such legislation or implementing regulations could affect our pricing flexibility, contracting strategy, distribution channels, and net revenues.

Individual states have also been increasingly active in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, marketing cost disclosure, drug price reporting and other transparency measures, and, in some cases, designed to encourage importation from other countries and bulk purchasing. In addition, regional health care authorities and individual hospitals are increasingly using bidding procedures to determine what pharmaceutical products and which suppliers will be included in their prescription drug and other healthcare programs. We expect that additional state and federal healthcare reform measures will be adopted in the future, particularly in light of the new presidential administration, any of which could limit the amounts that federal and state governments will pay for healthcare products and services.

Although a number of these and other proposed measures may require authorization through additional legislation to become effective, and the current presidential administration may reverse or otherwise change these measures, both the current presidential administration and Congress have indicated that they will continue to seek new legislative measures to control drug costs.

Similar political, economic, and regulatory developments are occurring in the EU and may affect the ability of pharmaceutical companies to profitably commercialize their products. In addition to continuing pressure on prices and cost containment measures, legislative developments at the EU or member state level may result in significant additional requirements or obstacles. The delivery of healthcare in the EU, including the establishment and operation of health services and the pricing and reimbursement of medicines, is almost exclusively a matter for national, rather than EU, law and policy. National governments and health service providers have different priorities and approaches to the delivery of health care and the pricing and reimbursement of products in that context. In general, however, the healthcare budgetary constraints in most EU member states have resulted in restrictions on the pricing and reimbursement of medicines by relevant health service providers. Coupled with ever-increasing EU and national regulatory burdens on those wishing to develop and market products, this could restrict or regulate post-approval activities and affect the ability of pharmaceutical companies to commercialize their products. In international markets, reimbursement and healthcare payment systems vary significantly by country, and many countries have instituted price ceilings on specific products and therapies.

In the EU, potential reductions in prices and changes in reimbursement levels could be the result of different factors, including reference pricing systems, parallel distribution, and parallel trade. It could also result from the application of external reference pricing mechanisms, which consist of arbitrage between low-priced and

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high- priced countries. Reductions in the pricing of our medicinal products in one EU member state could affect the price in other EU member states and, thus, have a negative impact on our financial results.

Health Technology Assessment ("HTA") of medicinal products in the EU is an essential element of the pricing and reimbursement decision-making process in a number of EU member states. The outcome of HTA has a direct impact on the pricing and reimbursement status granted to the medicinal product. A negative HTA by a leading and recognized HTA body concerning a medicinal product could undermine the prospects to obtain reimbursement for such product not only in the EU member state in which the negative assessment was issued, but also in other EU member states.

In 2011, Directive 2011/24/EU was adopted at the EU level. This Directive establishes a voluntary network of national authorities or bodies responsible for HTA in the individual EU member states. The network facilitates and supports the exchange of scientific information concerning HTAs. Further to this, on December 13, 2021, Regulation No 2021/2282 on HTA, amending Directive 2011/24/EU, was adopted. The Regulation entered into force in January 2022 and has been applicable since January 2025, with phased implementation based on the type of product, i.e. oncology and advanced therapy medicinal products as of 2025, orphan medicinal products as of 2028, and all other medicinal products by 2030. The Regulation intends to boost cooperation among EU member states in assessing health technologies, including new medicinal products, and provide the basis for cooperation at the EU level for joint clinical assessments in these areas. It will permit EU member states to use common HTA tools, methodologies, and procedures across the EU, working together in four main areas, including joint clinical assessment of the innovative health technologies with the highest potential impact for patients, joint scientific consultations whereby developers can seek advice from HTA authorities, identification of emerging health technologies to identify promising technologies early, and continuing voluntary cooperation in other areas. Individual EU member states will continue to be responsible for assessing non-clinical (e.g., economic, social, ethical) aspects of health technology, and making decisions on pricing and reimbursement.

**Facilities** 

Our corporate headquarters are located in South San Francisco, California, where we lease and occupy approximately 35,943 square feet of office and laboratory space. Our South San Francisco lease expires in 2030. We also lease and occupy approximately 21,489 square feet of office space in Princeton, New Jersey. Our Princeton lease expires in 2033.

We believe our existing facilities in South San Francisco and Princeton are sufficient for our needs for the foreseeable future. To meet the future needs of our business, we may lease additional or alternate space, and we believe suitable additional or alternative space will be available in the future on commercially reasonable terms.

**Employees and human capital resources** 

As of December 31, 2025, we had 210 full-time employees and approximately 82 consultants, and approximately 33 of our employees have M.D. or Ph.D. degrees. Within our workforce, 140 employees are engaged in research and development and 70 are engaged in business development, finance, legal, and general management and administration. Our human capital resources objectives include identifying, recruiting, retaining, incentivizing and integrating our existing and new employees, advisors and consultants. None of our employees are represented by a labor union or covered by a collective bargaining agreement. We consider our relationship with our employees to be good.

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**Legal proceedings** 

From time to time, we may become involved in litigation or other legal proceedings. We are not currently a party to any litigation or legal proceedings that, in the opinion of our management, are probable to have a material adverse effect on our business. Regardless of outcome, litigation can have an adverse impact on our business, financial condition, results of operations and prospects because of defense and settlement costs, diversion of management resources and other factors.

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**Management** 

**Executive officers and directors** 

The following table sets forth information regarding our executive officers and directors as of March 15, 2026:

---

| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| *Executive officers:* |  |  |
| Tassos Gianakakos | 53 | Chief Executive Officer, Director, and Chair |
| Brianne Puglisi | 39 | Chief Financial Officer |
| Jay Edelberg | 62 | Chief Medical Officer |
| Andy Pasternak | 55 | Chief Strategy Officer |
| *Non-employee directors:* |  |  |
| Paul Berns | 59 | Director |
| David Meeker, M.D. | 71 | Director |
| Douglas Giordano | 63 | Director |
| Kim Popovits | 67 | Director |

---

(1) Member of the audit committee.

(2) Member of the compensation committee.

(3) Member of the nominating and corporate governance committee.

***Executive officers***

***Tassos Gianakakos*** has served on our board of directors and as our Co-Founder, Chief Executive Officer and Chair since August 2023. Mr. Gianakakos also co-founded Prolaio, Inc. in November 2021, where he formerly held the role of chair and Chief Executive Officer prior to our acquisition of Prolaio, Inc. in February 2025. Previously, he served as Chief Executive Officer and President and a member of the board of directors of MyoKardia, Inc. from October 2013 to November 2020, when it was acquired by Bristol Myers Squibb (NYSE: BMY). From August 2020 to March 2024, Mr. Gianakakos served on the board of LianBio (formerly Nasdaq: LIAN). Mr. Gianakakos earned his B.S. in engineering and economics from the Massachusetts Institute of Technology, a graduate degree in biotechnology at Northwestern University and an MBA from Harvard Business School. We believe that Mr. Gianakakos' extensive leadership and business expertise in the pharmaceutical industry provides him with the appropriate set of skills to serve as a member of our board of directors.

***Brianne Puglisi*** has served as our Chief Financial Officer since November 2024. Prior to joining us, Ms. Puglisi served as Chief Business Officer for LianBio (formerly Nasdaq: LIAN) from February 2020 to January 2025. Previously, from April 2012 to January 2020, she was Senior Vice President of Finance and Strategic Operations at Kadmon Pharmaceuticals (formerly Nasdaq: KDMN) prior to its acquisition by Sanofi S.A. She has also held a senior-level position at KPMG LLP. Ms. Puglisi holds a B.B.A. degree from the University of Massachusetts, Amherst, and an MBA from New York University.

***Jay Edelberg, M.D., Ph.D.*** has served as our Co-Founder and Chief Medical Officer since August 2023. Dr. Edelberg co-founded Prolaio, Inc. in December 2021 and served as its Head of Research and Development prior to our acquisition of Prolaio, Inc. in February 2025. Prior to this, Mr. Edelberg was Chief Medical Officer for MyoKardia, Inc. from February 2019 to November 2020, when it was acquired by Bristol Myers Squibb

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(NYSE: BMY), and served as Senior Vice President of Global Drug Development at Bristol Myers Squibb from November 2020 to October 2021. Mr. Edelberg trained at the Massachusetts General Hospital (Internal Medicine), the Beth Israel Deaconess Medical Center in Boston (Cardiovascular Medicine) and Massachusetts Institute of Technology (Biology). He holds a B.S. in bioengineering from Columbia University, and an M.D. and Ph.D. from Duke University.

***Andy Pasternak*** has served as our Chief Strategy Officer since January 2026. Prior to joining Kardigan, Mr. Pasternak served as an Advisory Partner at Bain & Company, a global management consulting firm, from March 2024 to December 2025. Prior to that, Mr. Pasternak served as Executive Vice President and Chief Strategy Officer at Horizon Therapeutics plc from November 2019 until its acquisition by Amgen Inc. in October 2023. Mr. Pasternak has served as Chairman of the board of directors at Context Therapeutics (Nasdaq: CNTX) since January 2025 and served on the board of directors of Endo, Inc. from April 2024 to August 2025. He is also an adjunct lecturer and advisory board member in the Healthcare at the Kellogg School of Management at Northwestern University. Mr. Pasternak holds a B.A. in economics from Northwestern and an MBA from the University of Chicago.

***Non-executive directors***

***Paul Berns*** has served on our board of directors since June 2024. Mr. Berns is a Managing Director with ARCH Venture Partners. Mr. Berns has been a member of ARCH Venture Partners since August 2018 and became a Managing Director in 2021. Mr. Berns is the Co-founder and Executive Chairman of both Tenvie Therapeutics, Inc. and Ollin Biosciences, Inc. Mr. Berns was also the Co-founder and Chairman of the Board of Directors for HI-Bio prior to its acquisition by Biogen, Inc. in July 2024, as well as a Co-founder and Lead Independent Director of Metsera Inc. prior to its acquisition by Pfizer in November 2025. Mr. Berns is the Co-founder, Chief Executive Officer and Chairman of Neumora Therapeutics, Inc. (Nasdaq: NMRA), Co-founder and member of the Board of Directors of Salma Health, and currently serves as Chairman of the Board of Directors of the privately held company Happy AI, and is a member of the Board of Directors of Mirador Therapeutics, Rhygaze, and Epirium. Mr. Berns has served as a director of Unity Biotechnology, Inc. (Nasdaq: UBX) from March 2018 to April 2025, EQRx, Inc., from January 2020 up to its acquisition by Revolution Medicines, Inc. in November 2023, and Jazz Pharmaceuticals plc (Nasdaq: JAZZ), a publicly-traded pharmaceutical company, from April 2010 to July 2021. Mr. Berns holds a B.S. in Economics from the University of Wisconsin. We believe that Mr. Berns' financial expertise and experience in the biopharmaceutical industry qualify him to serve on our board of directors.

***David Meeker, M.D.*** has served on our board of directors since October 2024. Dr. Meeker has served as Chair, President and Chief Executive Officer of Rhythm Pharmaceuticals, Inc., a biopharmaceutical company (Nasdaq: RYTM), since July 2020. Dr. Meeker has also served as a director of Rhythm Pharmaceuticals, Inc. since November 2015 and as its chairman of the board since April 2017. Previously, Dr. Meeker served as Chief Executive Officer of KSQ Therapeutics, Inc., a biotechnology company, from October 2017 to July 2020. From October 2011 until June 2017, Dr. Meeker served as President and CEO of Genzyme Corporation and subsequently as EVP, Head of Sanofi Genzyme, a unit of Sanofi S.A., a global pharmaceutical company. Dr. Meeker oversaw the company's specialty business units-Rare Diseases, Multiple Sclerosis, Oncology and Immunology. He has also served as chairman of the board of directors of Trevi Pharmaceuticals, Inc. (Nasdaq: TRVI) since July 2017 and as chair of the board of directors of Pharvaris N.V. (Nasdaq: PHVS) since January 2021. Dr. Meeker completed his internal medicine residency at Harvard's Beth Israel Hospital and pulmonary/critical care training at Boston University. He holds an M.D. degree from the University of Vermont Medical School, did his medical training in Internal Medicine, and pulmonary/critical care, and completed the Advanced Management Program at Harvard Business School in 2000. We believe that Dr. Meeker's extensive experience in the biopharmaceutical industry qualify him to serve on our board of directors.

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***Douglas Giordano*** has served on our board of directors since June 2024. Mr. Giordano has served as a managing director at Perceptive Advisors since April 2021. Prior to joining Perceptive Advisors, Mr. Giordano was senior vice president of Pfizer Inc.'s Worldwide Business Development Group from 2010 until April 2021. From March 2007 through February 2010, Mr. Giordano was Vice President of Pfizer Worldwide Business Development, responsible for corporate development, licensing, alliance management, and all other corporate transactions. Mr. Giordano served as a member of the board of directors of Cerevel Therapeutics Holdings, Inc. (formerly Nasdaq: CERE), from September 2018 until its acquisition by AbbVie Inc. in August 2024. Mr. Giordano earned a B.S. in biomedical engineering from Duke University and an M.B.A. from Cornell University's Johnson School of Business. We believe Mr. Giordano's industry experience as an investor and business development executive qualify him to serve on our board of directors.

***Kim Popovits*** has served on our board of directors since September 2024. Ms. Popovits served as President and Chief Executive Officer of Genomic Health, Inc., a healthcare company, from January 2009 until its acquisition by Exact Sciences in November 2019. Prior to that role, Ms. Popovits served as Genomic Health's Chief Operating Officer from 2002 to 2009 and as its chairman of the board of directors from 2012 to 2019. Ms. Popovits has served as a director of Exact Sciences Corp (Nasdaq: EXAS) since January 2025, Kiniksa Pharmaceuticals, Ltd. (Nasdaq: KNSA) since May 2018, 10x Genomics, Inc. (Nasdaq: TXG) since March 2020, and Talis Biomedical Corporation (formerly Nasdaq: TLIS) since March 2020. Ms. Popovits holds a B.A. in business from Michigan State University. We believe that Ms. Popovits' extensive experience as a biotechnology executive and board member qualify her to serve on our board of directors.

**Family relationships** 

There are no family relationships among any of our executive officers or directors.

**Composition of our board of directors** 

Our business and affairs are managed under the direction of our board of directors, which currently consists of five members. The primary responsibilities of our board of directors are to provide oversight, strategic guidance, counseling and direction to our management. Our board of directors meets on a regular basis and additionally as required.

Certain members of our board of directors were elected under the provisions of our second amended and restated certificate of incorporation and agreements with our stockholders, which agreements are described under the section of this prospectus entitled "*Certain Relationships and Related Person Transactions*." These board composition provisions will terminate upon the completion of this offering. Upon the termination of these provisions, there will be no further contractual obligations regarding the election of our directors. Our nominating and corporate governance committee and our board of directors may therefore consider a broad range of factors relating to the qualifications and background of nominees. Our nominating and corporate governance committee's and our board of directors' priority in selecting board members is the identification of persons who will further the interests of our stockholders through their established record of professional accomplishment, the ability to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive landscape, professional and personal experiences, and expertise relevant to our growth strategy. Our directors hold office until their successors have been elected and qualified or until the earlier of their resignation or removal. Our third amended and restated certificate of incorporation, which will become effective upon the completion of this offering, and our amended and restated bylaws, which will become effective upon the effectiveness of the registration statement of which this prospectus forms a part, also provide that our directors may be removed only for cause by the affirmative vote of the holders of at least two-thirds of the votes that all our stockholders would be entitled to cast in an annual

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election of directors, and that any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office.

**Staggered board** 

Our third amended and restated certificate of incorporation, which will become effective upon the completion of this offering, and our amended and restated bylaws, which will be effective upon the effectiveness of the registration statement of which this prospectus forms a part, will permit our board of directors to establish the authorized number of directors from time to time by resolution. Each director serves until the expiration of the term for which such director was elected or appointed, or until such director's earlier death, resignation or removal. In accordance with our third amended and restated certificate of incorporation, our board of directors will be divided into three classes with staggered three-year terms. At each annual meeting of stockholders, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following election. Our directors will be divided among the three classes as follows:

• the Class I directors will be     and    and their terms will expire
at our first annual meeting of stockholders following this offering, to be held in     ;

• the Class II directors will be    and    and their terms will expire
at our second annual meeting of stockholders following this offering, to be held in    ; and

• the Class III directors will be    and    and their terms will expire
at our third annual meeting of stockholders following this offering, to be held in    .

We expect that any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one third of the directors. The division of our board of directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change in control.

This classification of our board of directors may have the effect of delaying or preventing changes in control of our company.

**Director independence** 

Under the listing standards, requirements and rules of (" Listing Rules"), independent directors must comprise a majority of our board of directors as a listed company within one year of the listing date. In addition, the Listing Rules require that, subject to specified exceptions, each member of a listed company's audit, compensation, and nominating and governance committees be independent within twelve months from the date of listing. Audit committee members must also satisfy additional independence criteria, including those set forth in Rule 10A-3 under the Exchange Act, and compensation committee members must also satisfy the independence criteria set forth in Rule 10C-1 under the Exchange Act. Under the Listing Rules, a director will only qualify as an "independent director" if, in the opinion of that company's board of directors, that person does not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In order to be considered independent for purposes of Rule 10A-3 under the Exchange Act, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee: (i) accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries, other than compensation for board service; or (ii) be an affiliated person of the listed company or any of its subsidiaries. In order to be considered

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independent for purposes of Rule 10C-1 under the Exchange Act, the board of directors must consider, for each member of a compensation committee of a listed company, all factors specifically relevant to determining whether a director has a relationship to such company which is material to that director's ability to be independent from management in connection with the duties of a compensation committee member, including, but not limited to: the source of compensation of the director, including any consulting advisory or other compensatory fee paid by such company to the director, and whether the director is affiliated with the company or any of its subsidiaries or affiliates.

Our board of directors has undertaken a review of the independence of each director. Based on information provided by each director concerning her or his background, employment, and affiliations, including family relationships, our board of directors has determined that , and do not have relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is "independent" as that term is defined under the Listing Rules. Our board of directors has determined that Tassos Gianakakos is not independent under applicable rules and regulations of the SEC and the Listing Rules. In making these determinations, our board of directors considered the current and prior relationships that each non-employee director has with our company and all other facts and circumstances our board of directors deemed relevant in determining their independence, including the beneficial ownership of our shares by each non-employee director and the transactions described in the section titled "*Certain Relationships and Related Person Transactions*." Upon the completion of this offering, we expect that the composition and functioning of our board of directors and each of our committees will comply with all applicable requirements of and the rules and regulations of the SEC.

We intend to adopt a policy, subject to and effective upon the effectiveness of the registration statement of which this prospectus forms a part, that outlines a process for our securityholders to send communications to the board of directors.

**Board policies** 

In connection with this offering, we intend to adopt policies and procedures for director candidates for our nominating and corporate governance committee, which will provide for factors, such as a candidate's character, judgment, skills, education, expertise, and absence of conflicts of interest should be considered in determining director candidates. Our priority in selection of board members will be identification of members who will further the interests of our stockholders through their established records of professional accomplishment, their ability to contribute positively to the collaborative culture among board members, and their knowledge of our business and understanding of the competitive landscape in which we operate and adherence to high ethical standards.

**Board's role in risk oversight** 

Risk is inherent with every business, and how well a business manages risk can ultimately determine its success. We face a number of risks, including risks relating to our financial condition, development and commercialization activities, operations, strategic direction, and intellectual property as more fully discussed in the section titled "*Risk Factors*" appearing elsewhere in this prospectus. Management is responsible for the day-to-day management of risks we face, while our board of directors, as a whole and through its committees, has responsibility for the oversight of risk management. In its risk oversight role, our board of directors has the responsibility to satisfy itself that the risk management processes designed and implemented by management are adequate and functioning as designed.

The role of the board of directors in overseeing the management of our risks is conducted primarily through committees of the board of directors, as disclosed in the descriptions of each of the committees below and in

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the charters of each of the committees. The full board of directors (or the appropriate board committee in the case of risks that are under the purview of a particular committee) discusses with management our major risk exposures, their potential impact on us, and the steps we take to manage them. When a board committee is responsible for evaluating and overseeing the management of a particular risk or risks, the chairperson of the relevant committee reports on the discussion to the full board of directors during the committee reports portion of the next board meeting. This enables the board of directors and its committees to coordinate the risk oversight role, particularly with respect to risk interrelationships.

**Committees of our board of directors** 

Our board of directors has established an audit committee, a compensation committee, and a nominating and corporate governance committee. The composition and responsibilities of each of the committees of our board of directors are described below. Members serve on these committees until their resignation or until otherwise determined by our board of directors. Each committee intends to adopt a written charter, which will be effective upon the completion of this offering, that satisfies the application rules and regulation of the SEC, the Sarbanes-Oxley Act of 2002 and the Listing Rules. We will post the written charters to our website at *www.kardigan.bio* upon the completion of this offering. Information contained on, or accessible through, our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is only an inactive textual reference. Our board of directors may establish other committees as it deems necessary or appropriate from time to time.

***Audit committee***

Upon the completion of this offering, our audit committee will consist of , and , and the chair of our audit committee will be . Our board of directors has determined that each member of the audit committee is independent under Listing Rules and Rule 10A-3(b)(1) of the Exchange Act and can read and understand fundamental financial statements in accordance with applicable requirements. Our board of directors has also determined that is an "audit committee financial expert" within the meaning of SEC regulations. In arriving at these determinations, our board of directors has examined each audit committee member's scope of experience and the nature of their employment in the corporate finance sector. Both our independent registered public accounting firm and management will periodically meet privately with our audit committee.

The primary purpose of the audit committee is to discharge the responsibilities of our board of directors with respect to our corporate accounting and financial reporting processes, systems of internal control and financial-statement audits, and to oversee our independent registered public accounting firm. Specific responsibilities of our audit committee include:

• appointing, approving the compensation of, and assessing the independence of our independent registered public accounting
firm;

• pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;

• reviewing the overall audit plan with our independent registered public accounting firm and members of management
responsible for preparing our financial statements;

• reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly
financial statements and related disclosures as well as critical accounting policies and practices used by us;

• coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;

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• establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns;

• recommending based upon the audit committee's review and discussions with management and our independent registered
public accounting firm whether our audited financial statements shall be included in our Annual Report on Form 10-K;

• monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they
relate to our financial statements and accounting matters;

• preparing the audit committee report required by SEC rules to be included in our annual proxy statement;

• reviewing all related person transactions for potential conflict of interest situations and approving all such
transactions; and

• reviewing quarterly earnings releases.

***Compensation committee***

Upon the completion of this offering, our compensation committee will consist of , and , and the chair of our compensation committee will be . Our board of directors has determined that each member of the compensation committee is independent under the Listing Rules and is a "non-employee director" as defined in Rule 16b-3 promulgated under the Exchange Act.

The primary purpose of our compensation committee is to discharge the responsibilities of our board of directors in overseeing our compensation policies, plans, and programs and to review and determine the compensation to be paid to our executive officers, directors, and other senior management, as appropriate. Specific responsibilities of our compensation committee include:

• annually reviewing and recommending to the board of directors the corporate goals and objectives relevant to the
compensation of our Chief Executive Officer;

• evaluating the performance of our Chief Executive Officer in light of such corporate goals and objectives and based on such
evaluation (i) reviewing and determining the cash compensation of our Chief Executive Officer and (ii) reviewing and approving grants and awards to our Chief Executive Officer under equity-based plans;

• reviewing and approving the compensation of our other executive officers;

• reviewing and establishing our overall management compensation, philosophy and policy;

• overseeing and administering our compensation and similar plans;

• evaluating and assessing potential and current compensation advisors in accordance with the independence standards
identified in the applicable    listing rules;

• reviewing and approving our policies and procedures for the grant of equity-based awards;

• reviewing and recommending to the board of directors the compensation of our directors;

• preparing our compensation committee report if and when required by SEC rules;

• reviewing and discussing annually with management our "Compensation Discussion and Analysis," if and when
required, to be included in our annual proxy statement; and

• reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation
of compensation matters.

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***Nominating and corporate governance committee***

Upon the completion of this offering, our nominating and corporate governance committee will consist of , and , and the chair of our nominating and corporate governance committee will be . Our board of directors has determined that each member of the nominating and corporate governance committee is independent under the Listing Rules, a non-employee director, and free from any relationship that would interfere with the exercise of his or her independent judgment.

The primary purpose of the nominating and corporate governance committee is to discharge the responsibilities of our board of directors with respect to our corporate governance functions and to identify, communicate with, evaluate and recommend candidates for our board of directors. Specific responsibilities of our nominating and corporate governance committee include:

• developing and recommending to the board of directors criteria for board and committee membership;

• establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by
stockholders;

• reviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate
skills and expertise to advise us;

• identifying individuals qualified to become members of the board of directors;

• recommending to the board of directors the persons to be nominated for election as directors and to each of the
board's committees;

• developing and recommending to the board of directors a code of business conduct and ethics and a set of corporate
governance guidelines; and

• overseeing the evaluation of our board of directors and management.

**Code of business conduct and ethics** 

In connection with this offering, we intend to adopt a written code of business conduct and ethics that applies to all our employees, officers, and directors. This includes our principal executive officer, principal financial officer, and principal accounting officer or controller, or persons performing similar functions. The full text of our code of business conduct and ethics will be posted on our website at *www.kardigan.bio*. We intend to disclose on our website any future amendments of our code of business conduct and ethics or waivers that exempt any principal executive officer, principal financial officer, principal accounting officer or controller, persons performing similar functions, or our directors from provisions in the code of business conduct and ethics. Information contained on, or accessible through, our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is only an inactive textual reference.

**Compensation committee interlocks and insider participation** 

None of the members of the compensation committee is currently, or has been at any time, one of our officers or employees. None of our officers currently serve, or have served during the last calendar year, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving as a member of our board of directors or compensation committee.

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**Compensation recovery** 

In connection with this offering, we intend to adopt a compensation recovery policy that is compliant with the Listing Rules, as required by the Dodd-Frank Act, to be effective in connection with the effectiveness of the registration statement of which this prospectus forms a part.

**Limitations on liability and indemnification agreements** 

As permitted by Delaware law, provisions in our third amended and restated certificate of incorporation and amended and restated bylaws, which will become effective upon the completion of this offering and upon the effectiveness of the registration statement of which this prospectus forms a part, respectively, limit or eliminate the personal liability of directors and officers for a breach of their fiduciary duty of care as a director or officer. The duty of care generally requires that, when acting on behalf of the corporation, a director and/or officer exercise an informed business judgment based on all material information reasonably available to him or her. Consequently, a director or officer will not be personally liable to us or our stockholders for monetary damages or breach of fiduciary duty as a director or officer, except for liability for:

• any breach of the director or officer's duty of loyalty to us or our stockholders;

• any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• for our directors, unlawful payments of dividends or unlawful stock repurchases, or redemptions as provided in
Section 174 of the Delaware General Corporation Law ("DGCL");

• for our officers, any derivative action by or in the right of the corporation; or

• any transaction from which the director or officer derived an improper personal benefit.

These limitations of liability do not limit or eliminate our rights or any stockholder's rights to seek non-monetary relief, such as injunctive relief or rescission. These provisions will not alter a director or officer's liability under other laws, such as the federal securities laws or other state or federal laws. Our third amended and restated certificate of incorporation that will become effective upon the closing of this offering also authorizes us to indemnify our officers, directors and other agents to the fullest extent permitted under Delaware law.

As permitted by Delaware law, our amended and restated bylaws to be effective immediately prior to the consummation of this offering will provide that:

• we will indemnify our directors, officers, employees and other agents to the fullest extent permitted by law;

• we must advance expenses to our directors and officers, and may advance expenses to our employees and other agents, in
connection with a legal proceeding to the fullest extent permitted by law; and

• the rights provided in our amended and restated bylaws are not exclusive.

If Delaware law is amended to authorize corporate action further eliminating or limiting the personal liability of a director or officer, then the liability of our directors or officers will be so eliminated or limited to the fullest extent permitted by Delaware law, as so amended. Our amended and restated bylaws will also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in connection with their services to us, regardless of whether our amended and restated bylaws permit such indemnification. We have obtained such insurance.

In addition to the indemnification that will be provided for in our third amended and restated certificate of incorporation and amended and restated bylaws, we plan to enter into separate indemnification agreements

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with each of our directors and executive officers, which may be broader than the specific indemnification provisions contained in the DGCL. These indemnification agreements may require us, among other things, to indemnify our directors and executive officers for some expenses, including attorneys' fees, expenses, judgments, fines and settlement amounts incurred by a director or executive officer in any action or proceeding arising out of his service as one of our directors or executive officers or any other company or enterprise to which the person provides services at our request. We believe that these provisions and agreements are necessary to attract and retain qualified individuals to serve as directors and executive officers.

This description of the indemnification provisions of our third amended and restated certificate of incorporation, our amended and restated bylaws and our indemnification agreements is qualified in its entirety by reference to these documents, each of which is attached as an exhibit to the registration statement of which this prospectus forms a part.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.

There is no pending litigation or proceeding naming any of our directors or officers as to which indemnification is being sought, nor are we aware of any pending or threatened litigation that may result in claims for indemnification by any director or officer.

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**Executive compensation** 

The following discussion contains forward-looking statements that are based on our current plans, considerations, expectations and determinations regarding future compensation programs. The actual amount and form of compensation and the compensation policies and practices that we adopt in the future may differ materially from currently planned programs as summarized in this discussion.

As an emerging growth company, we have opted to comply with the executive compensation disclosure rules applicable to "smaller reporting companies" as such term is defined in the rules promulgated under the Securities Act. Our named executive officers ("NEOs"), for the year ended December 31, 2025, which consist of our principal executive officer and our two most highly compensated executive officers (other than our Chief Executive Officer), are:

• Tassos Gianakakos, our Chief Executive Officer;

• Jay Edelberg, M.D., Ph.D., our Chief Medical Officer; and

• Brianne Puglisi, our Chief Financial Officer.

**2025 summary compensation table** 

The following table sets forth information regarding compensation awarded to, earned by, or paid to our NEOs for services rendered to us in all capacities during the fiscal year ended December 31, 2025.

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name and principal position** | **Year** | **Salary($)** | | **Bonus($)(1)** | **Stock<br>awards($)(1)** | **Option<br>awards($)(2)** | **Non-equity<br>incentive plan<br>compen-**<br> **sation($)(3)** | **All other**<br> **compen-**<br> **sation($)(4)** | **Total($)** |
|  Tassos Gianakakos | 2025 | 532837 | (5) | 2310750 | 6689250 | 6313471 | 223000 | 2737496 | 18806803 |
| &nbsp;&nbsp;&nbsp;&nbsp; Chief Executive Officer |  |  |  |  |  |  |  |  |  |
|  Jay Edelberg | 2025 | 457707 |  | 691000 | 1309000 | 346416 | 147358 | 623246 | 3574727 |
| &nbsp;&nbsp;&nbsp;&nbsp; Chief Medical Officer |  |  |  |  |  |  |  |  |  |
|  Brianne Puglisi | 2025 | 460000 |  |  |  | 1216747 | 151340 |  | 1828087 |
| &nbsp;&nbsp;&nbsp;&nbsp; Chief Financial Officer |  |  |  |  |  |  |  |  |  |

---

(1) The amounts reported in the Bonus and Stock Awards column reflect the integration bonus paid as part of the Prolaio transaction-related incentive program, which was paid in a mix of cash and shares of Series B preferred
stock. The amounts reported in the Stock Awards column represent the aggregate grant date fair value of such shares of Series B preferred stock calculated in accordance with FASB ASC Topic 718. For more information on these bonuses, see a
description of the annual performance bonuses under the section titled "*—Narrative Disclosure to Summary Compensation Table—Prolaio Bonus Integration Agreements*" below.

(2) The amounts reported represent the aggregate grant date fair value of the stock options granted to the named executive officers during the applicable fiscal year, calculated in accordance with FASB ASC 718. The
assumptions used in calculating the grant date fair value of the stock options reported in this column are set forth in Note 11 to our consolidated financial statements included elsewhere in this prospectus. The amounts reported in this column
reflect the accounting cost for the stock options, and does not correspond to the actual economic value that may be received upon exercise of the stock options, issuance of shares of common stock, or any sale of any of the underlying shares of
common stock.

(3) The amounts reported represent the annual bonuses each NEO earned during fiscal year 2025 based on achievement of company performance, which were paid in the first quarter of 2026. For more information on these bonuses,
see a description of the annual performance bonuses under the section titled "*—Narrative Disclosure to Summary Compensation Table—Elements of Compensation—Annual Cash Bonus Opportunities*" below.

(4) The amounts reported reflect the tax gross-up paid as part of the Prolaio transaction-related incentive program, to reflect (i) the incremental taxes owed due to the
difference in tax treatment between ordinary income and capital gains and (ii) an additional tax gross-up on such amount. For more information, see the description under "*—Narrative Disclosure to Summary Compensation Table–Prolaio Bonus Integration Agreements*" below.

(5) Includes $21,576 earned as salary for Mr. Gianakakos' employment with Prolaio following the Prolaio transaction for a transitional period through April 30, 2025. During this transitional period, we reduced
Mr. Gianakakos' salary by a corresponding amount.

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**Narrative disclosure to the summary compensation table** 

***Elements of compensation***

The compensation of our NEOs generally consists of three key elements: (i) base salary; (ii) annual cash bonus opportunities; and (iii) long term incentive compensation in the form of equity awards.

*Base salaries* 

The base salary payable to each NEO is intended to provide a fixed component of compensation reflecting the executive's skill set, experience, role, responsibilities, and contributions. Each NEO's initial base salary was specified, as described below, either in his offer letter or employment agreement, or in absence of such documentation, through approval by the board of directors, and is reviewed (and, if applicable, adjusted) from time to time by our board of directors or compensation committee.

For the fiscal year ended December 31, 2025, the annual base salaries for Mr. Gianakakos, Dr. Edelberg and Ms. Puglisi were as follows:

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| | | |
|:---|:---|:---|
| **Named executive officer** | **2024 annual**<br> **base salary<br>(through<br>2/15/2025)** | **2025 annual<br>base salary**<br> **(effective<br>2/16/2025)** |
|  Tassos Gianakakos | $527000 | $540175 |
|  Jay Edelberg | $446000 | $459380 |
|  Brianne Puglisi(1) | $460000 | $460000 |

---

(1) Ms. Puglisi's base salary was determined at the time she joined us in November 2024, which remained in effect throughout 2025.

*Annual cash bonus opportunities* 

For the fiscal year ended December 31, 2025, each of our NEOs was eligible to earn an annual bonus based on the Company's achievement of certain performance objectives. Each NEO's target bonus opportunity, expressed as a percentage of base salary, is established at the time of appointment based on independent market data. The target annual bonus for Mr. Gianakakos, Dr. Edelberg and Ms. Puglisi were 45%, 35% and 35% of their respective base salaries.

The goals applicable to our NEOs' 2025 annual cash bonuses related to the achievement of certain performance milestones with individual performance also considered as part of the overall evaluation. Following a review of 2025 performance, our compensation committee determined that we had achieved our 2025 goals at 92% and approved 2025 cash incentive payments to our NEOs in the amounts reported in the Non-Equity Incentive Plan column of our 2025 Summary Compensation Table above. Compensation decisions for the Chief Executive Officer, including bonus determinations, were reviewed and approved by the Board of Directors.

*Equity-Based compensation* 

Although we do not have a formal policy with respect to the grant of equity incentive awards to our executive officers, we believe that equity grants provide our executives with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executives and our stockholders. In addition, we believe that equity grants promote executive retention because they incentivize our executive officers to remain in our employment during the vesting period.

Accordingly, our board of directors or our compensation committee periodically reviews the equity incentive compensation of our NEOs and may grant equity incentive awards to them from time to time. See "—*Outstanding Equity Awards at Fiscal Year-End*" for more information regarding equity awards made to our NEOs.

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***Perquisites/personal benefits***

Perquisites or other personal benefits are not a significant component of our executive compensation program. Accordingly, we do not provide significant perquisites or other personal benefits to our executive officers, including our named executive officers.

***401(k) plan***

We currently maintain a tax-qualified 401(k) retirement savings plan for our employees, including our NEOs, who satisfy certain eligibility requirements. Our NEOs are eligible to participate in the 401(k) plan on the same terms as other full-time employees. Our 401(k) plan is intended to qualify for favorable tax treatment under Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and contains a cash or deferred feature that is intended to meet the requirements of Section 401(k) of the Code. During fiscal year 2025, we did not make any matching contributions under our 401(k) plan.

***Prolaio bonus integration agreements***

On February 24, 2025, we entered into an agreement (the "Bonus Agreements") with each of Mr. Gianakakos and Dr. Edelberg pursuant to which Mr. Gianakakos and Dr. Edelberg were granted a right to a bonus upon the closing and successful integration of Prolaio into us in the amount of $9.0 million and $2.0 million, respectively, of our common stock issued in our initial public offering or in our redeemable convertible preferred stock if a preferred stock financing occurred before our initial public offering (the "bonus equity securities"), plus an additional amount to cover the incremental taxes owed due to the treatment of the bonus equity securities as ordinary income rather than long term capital gains (plus an additional amount to cover the federal, state and local income and employment taxes on such incremental amount). We also agreed that if the bonus equity securities issued in connection with the Bonus Agreements were not freely tradeable securities, we would loan each of Mr. Gianakakos and Dr. Edelberg an amount necessary to cover all applicable federal, state and local taxes applicable to the bonuses.

The payment of the bonuses pursuant to the Bonus Agreements was triggered by our Series B financing. On September 4, 2025, in connection with the Series B financing, we entered into bonus integration agreements (the "Bonus Integration Agreements") with each of Mr. Gianakakos and Dr. Edelberg. The Bonus Integration Agreements modified the Bonus Agreements such that (i) each recipient agreed to forfeit Series B preferred stock to satisfy the tax withholding obligations, (ii) certain payments required to be made under the Bonus Agreements would be remitted to tax authorities via payroll for certain tax liabilities required to be satisfied by us through payroll and (iii) no loan will be issued to the recipient. Pursuant to the Bonus Integration Agreements, (i) Mr. Gianakakos received a net of 313,092 shares of Series B redeemable convertible preferred stock and we remitted $4,912,142 directly to federal and state tax authorities via payroll and $136,104 directly to Mr. Gianakakos in satisfaction of certain tax liabilities and (ii) Dr. Edelberg received a net of 61,268 shares of Series B redeemable convertible preferred stock and we remitted $1,314,246 directly to federal and tax authorities via payroll in satisfaction of certain tax liabilities.

**Compensation recovery policy** 

In accordance with the requirements of the SEC and Listing Rules, our board of directors plans to adopt a compensation recovery policy, which will become effective upon the date on which the registration statement of which this prospectus is part is declared effective by the SEC. The compensation recovery policy will provide that in the event we are required to prepare a restatement of financial statements due to material noncompliance with any financial reporting requirement under securities laws, we will seek to recover any incentive-based compensation that was based upon the attainment of a financial reporting measure and that was received by any current or former executive officer during the three-year period preceding the date that

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the restatement was required if such compensation exceeds the amount that the executive officers would have received based on the restated financial statements.

**Outstanding equity awards at fiscal year-end** 

The following table provides information regarding the outstanding equity awards held by our NEOs as of December 31, 2025. All awards were granted pursuant to the 2023 Plan. See "—*Equity Incentive Plans—2023 Plan*" below for additional information.

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Option awards** | **Stock awards** | **Stock awards** |
| **Name and**<br> **principal**<br> **position** | **Grant date** | | **Vesting<br>start date** | **Number of<br>securities<br>underlying<br>unexercised<br>options<br>exercisable(#)(1)** | **Number of<br>securities<br>underlying<br>unexercised<br>options<br>unexercisable(#)(1)** | **Equity<br>incentive<br>plan<br>awards:<br>number of<br>securities<br>underlying<br>unexercised<br>unearned<br>options(#)** | **Option<br>exercise<br>price($)** | **Option<br>expiration<br>date** | **Number<br>of shares<br>or units<br>of stock<br>that<br>have not<br>vested(#)** | **Market<br>value of<br>shares or<br>units of<br>stock that<br>have not<br>vested($)(2)** |
|  Tassos Gianakakos | 6/6/2024 | (3) | 6/6/2024 |  |  | 2685458 | 2.15 | 6/5/2034 |  |  |
|  Chief Executive | 8/5/2024 | (4) | 7/1/2024 |  |  |  |  |  | 516667 | 4768836 |
|  Officer | 10/1/2025 | (3) | 10/1/2025 |  |  | 879567 | 9.23 | 9/30/2035 |  |  |
|  Jay Edelberg | 8/18/2023 | (5) | 6/6/2024 |  |  |  |  |  | 625000 | 5768750 |
|  Chief Medical | 8/5/2024 | (4) | 7/1/2024 |  |  |  |  |  | 193750 | 1788313 |
|  Officer | 9/19/2025 | (6) | 3/13/2025 |  | 60000 |  | 6.58 | 4/6/2035 |  |  |
|  Brianne Puglisi | 4/7/2025 | (7) | 11/18/2024 | 32500 | 87500 |  | 5.02 | 4/6/2035 |  |  |
|  Chief Financial Officer | 4/7/2025 | (8) | 11/18/2024 | 24850 | 65150 |  | 5.02 | 4/6/2035 |  |  |

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(1) All options were granted under our 2023 Plan. To the extent noted below, certain options are exercisable immediately upon grant, subject to a repurchase right in favor of the Company, which lapses as the option vests.
Accordingly, the columns and footnotes below reflect the extent to which the stock options held by our named executive officers were vested (as opposed to exercisable) as of December 31, 2025.

(2) The amounts reported in this column reflect the market value of the number of unvested shares, valued at $9.23 per share, which represents the fair market value of the Company's common stock as of
December 31, 2025.

(3) This option is early exercisable. The shares underlying this option are subject to both service-based and performance vesting conditions. The service-based vesting condition shall be satisfied if Mr. Gianakakos
remains in service as CEO through the earliest of June 6, 2027, his death or disability or his termination without cause or for good reason (a "Qualifying Termination Event"). The performance vesting conditions are based upon
achieving specified valuation thresholds while he remains in service as CEO or within 2 years following a Qualifying Termination Event.

(4) The shares underlying this award have been acquired upon the early exercise of a stock option and are subject to repurchase. The shares vest as follows: 25% vests upon the first anniversary of the vesting start date and
the remaining 75% of the option vests in 36 equal monthly installments thereafter, in each case, subject to the continued service of the named executive officer.

(5) The shares of restricted stock subject to this award vested 50% upon grant and the remaining 50% vested in 36 equal monthly installments following the vesting start date, subject to the continued service of the named
executive officer.

(6) The total grant consisted of an option to purchase 60,000 shares, allocated as follows: 53,670 shares subject to the option were designated as Incentive Stock Options ("ISOs") and 6,330 shares subject to the
option were designated as Non-Qualified Stock Options ("NQSOs"). The NQSO portion of the award is early exercisable and the ISO portion is exercisable only upon vesting. The option vests as follows: 25% vests upon the first anniversary
of the vesting commencement date and the remaining 75% of the option vests in 36 equal monthly installments thereafter, in each case, subject to the continued service of the named executive officer.

(7) The total grant consisted of an option to purchase 120,000 shares, allocated as follows: 79,680 shares subject to the option were designated as ISOs and 40,320 of the shares subject to the option were designated as
NQSOs. The NQSO portion of the award is early exercisable and the ISO portion is exercisable only upon vesting. The option vests as follows: 25% vests upon the first anniversary of the vesting commencement date and the remaining 75% of the option
vests in 36 equal monthly installments thereafter, in each case, subject to the continued service of the named executive officer.

(8) The total grant consisted of a NQSO to purchase 91,757 shares, all of which were early exercisable. The option vests as follows: 25% vests upon the first anniversary of the vesting commencement date and the remaining
75% of the option vests in 36 equal monthly installments thereafter, in each case, subject to the continued service of the named executive officer.

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***Employment and severance arrangements***

*Amended and restated severance policy* 

On April 23, 2025, our board of directors adopted the Executive Severance and Change in Control Policy, which was amended and restated on October 1, 2025 (the "Severance Policy"), in which our named executive officers and certain other executives are eligible to participate.

The Severance Policy provides that upon a termination by us for any reason without Cause or resignation for Good Reason, each as defined in the Severance Policy (a "Qualifying Termination"), in each case outside of the period commencing three months prior to and ending on the first anniversary following a Sale Event, as defined in the Severance Policy (the "Change in Control Period"), eligible participants will be entitled to receive, subject to the execution and delivery of a release of claims in favor of the company and continued compliance with all applicable restrictive covenants, (a) a lump sum payment equal to 12 months of base salary for the Chief Executive Officer and nine months for each other executive other than the Chief Executive Officer and (b) an amount equal to the monthly employer contribution that we would have made to provide health insurance for the applicable participant if he or she had remained employed by us for 12 months, in the case of our Chief Executive Officer, or nine months, for each executive other than the Chief Executive Officer.

The Severance Policy also provides that upon a Qualifying Termination within the Change in Control Period, an eligible participant will be entitled to receive, in lieu of the payments and benefits above and subject to the execution and delivery of a release of claims in favor of the company and continued compliance with all applicable restrictive covenants, (a) a lump sum payment equal to the sum of (i) 18 months' base salary for the Chief Executive Officer and 12 months' base salary for each executive other than the Chief Executive Officer and (ii) 1.5 times the target annual bonus in effect immediately prior to the date of termination for the Chief Executive Officer and 1.0 times for each executive other than the Chief Executive Officer, (b) an amount equal to the monthly employer contribution, based on the premiums as of the date of termination, that we would have made to provide health insurance for the applicable participant if he or she had remained employed by us for 18 months, in the case of the Chief Executive Officer, and 12 months, in the case of each executive other than the Chief Executive Officer and (c) for all outstanding and unvested equity awards of the company that are subject to time-based vesting held by the participant, full accelerated vesting of such awards.

The payments and benefits provided under the Severance Policy in connection with a Sale Event may not be eligible for a federal income tax deduction by us pursuant to Section 280G of the Code. These payments and benefits may also subject an eligible participant, including named executive officers, to an excise tax under Section 4999 of the Code. If the payments or benefits payable in connection with a Sale Event would be subject to the excise tax imposed under Section 4999 of the Code, then those payments or benefits will be reduced if such reduction would result in a higher net after-tax benefit to the participant.

***Senior executive cash incentive bonus plan***

On , 2026, our board of directors adopted the Senior Executive Cash Incentive Bonus Plan (the Bonus Plan). The Bonus Plan provides for cash bonus payments based upon company and individual performance targets established by our compensation committee. The payment targets will be related to financial and operational measures or objectives with respect to our company, or the corporate performance goals, as well as individual performance objectives.

Our compensation committee may select corporate performance goals from among the following: , any of which may be (A) measured in absolute terms, as compared to any incremental increase, (B) measured in terms of growth, as compared to results of a peer group, (C) measured against the market as a whole, compared to applicable market indices and/or measured on a pre-tax or post-tax basis.

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Each executive officer who is selected to participate in the Bonus Plan will have a target bonus opportunity set for each performance period. The bonus formulas will be adopted in each performance period by the compensation committee and communicated to each executive. The corporate performance goals will be measured at the end of each performance period after our financial reports have been published or such other appropriate time as the compensation committee determines. If the corporate performance goals and individual performance objectives are met, payments will be made as soon as practicable following the end of each performance period. Subject to the rights contained in any agreement between the executive officer and us, an executive officer shall be required to be employed by us on the bonus payment date to be eligible to receive a bonus payment under the Bonus Plan. The Bonus Plan also permits the compensation committee to approve additional bonuses to executive officers in its sole discretion.

**Equity incentive plans** 

***Amended and restated 2023 stock option and grant plan***

Our 2023 Plan, as amended and restated, was originally adopted on August 18, 2023 was subsequently amended and restated on June 6, 2024, and was further amended on March 20, 2025, May 15, 2025, September 4, 2025 and February 13, 2026, to enable the issuance of incentive stock options, non-qualified stock options, restricted stock awards, unrestricted stock awards and restricted stock units to our employees, officers, directors, consultants and other key persons. As of December 31, 2025, the Company had reserved an aggregate of 21,190,579 shares of common stock for the issuance of stock options and other equity awards under the 2023 Plan. This number of shares of common stock reserved for issuance is subject to adjustment in the event of a stock split, stock dividend, or other change in the Company's capitalization. Subject to such overall limitation, the maximum number of shares that may be issued as incentive stock options under the 2023 Plan may not exceed 100,000,000 shares. As of December 31, 2025, options to purchase 8,177,647 shares of common stock and 625,000 unvested shares of restricted stock were outstanding under the 2023 Plan. Our board of directors has determined not to make any further awards under the 2023 Plan following the completion of this offering, but all outstanding awards under the 2023 Plan will continue to be governed by their existing terms. In connection with this offering, we intend to adopt a new incentive equity plan under which we will grant equity-based awards following this offering, as described below under "*—2026 Equity Incentive Plan*." This summary is not a complete description of all provisions of the 2023 Plan and is qualified in its entirety by reference to the 2023 Plan, which will be filed as an exhibit to the registration statement of which this prospectus is part.

*Share recycling* 

The shares of common stock underlying any awards that are forfeited, cancelled, reacquired by the Company prior to vesting, satisfied without the issuance of stock, or otherwise terminated (other than by exercise), and shares that are withheld upon exercise of an option or settlement of an award to cover the exercise price or tax withholding under the 2023 Plan are added back to the shares of common stock available for issuance under the 2023 Plan.

*Options* 

The 2023 Plan permits the granting of both options to purchase common stock intended to qualify as incentive stock options under Section 422 of the Code and options that do not so qualify. The option exercise price of each option will be determined by the administrator of the 2023 Plan but may not be less than 100% of the fair market value of the Company's common stock on the date of grant, or in the case of an incentive stock option granted to a 10% owner, the exercise price shall not be less than 110% of the fair market value of the Company's common stock on the date of grant. The term of each option is fixed by the 2023 Plan administrator and may not exceed ten years from the date of grant, or five years from the date of grant in the case of an

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incentive stock option granted to a 10% owner. The 2023 Plan administrator determines at what time or times each option may be exercised.

*Restricted stock and restricted stock units* 

The 2023 Plan administrator may award restricted shares of common stock and restricted stock units to participants subject to such conditions and restrictions as it may determine. These conditions and restrictions may include continued employment or other service relationship with the Company through a specified vesting period and/or the achievement of certain performance goals.

*Unrestricted stock awards.* 

The 2023 Plan administrator may also grant shares of common stock that are free from any restrictions under the 2023 Plan. Unrestricted stock may be granted to participants in recognition of past services or for other valid consideration and may be issued in lieu of cash compensation due to such participant.

*Sale event* 

Upon the effective time of a "sale event" (as defined in the 2023 Plan), all outstanding option awards granted under the 2023 Plan and the 2023 Plan shall terminate unless assumed or continued by a successor entity. In the event of such termination, individuals holding options will be permitted to exercise such options within a specified period of time prior to the sale event. In the event of a sale event, all unvested restricted stock awards and restricted stock units (other than those that become vested as a result of the sale event) will be forfeited unless assumed or continued by a successor entity. With respect to individuals holding restricted stock that is forfeited upon a sale event, such restricted stock shall be repurchased by the Company at a price per share equal to the lower of the original per share purchase price paid by the holder (subject to adjustment) or the current fair market value of such shares as determined immediately prior to the effective time of the sale event. In addition, in connection a sale event, the Company may make or provide for a cash payment to participants in exchange for the cancellation of their options (to the extent then vested and exercisable, including by reason of acceleration in connection with such sale event) or outstanding restricted stock or restricted stock units, in an amount equal to the difference between (a) the per share consideration in the sale event times the number of shares subject to the vested portion of such awards being cancelled and (b) the aggregate price paid, or exercise price, as applicable, if any, of the awards.

*Adjustments* 

In the event of certain corporate transactions and events, including a reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split, or other similar change to the Company's capital stock, the 2023 Plan administrator shall make appropriate adjustments to the maximum number of shares reserved for issuance under the 2023 Plan, the number and kind of securities subject to outstanding awards under the 2023 Plan, and the repurchase or exercise price of any outstanding awards under the 2023 Plan.

*Transferability* 

Stock options and, prior to exercise, the shares issuable upon exercise of such stock option, shall not be transferable by the optionee otherwise than by will or by the laws of descent and distribution, and all stock options shall be exercisable, during the optionee's lifetime, only by the optionee, or by the optionee's legal representative or guardian in the event of the optionee's incapacity. However, the plan administrator may permit an optionee to transfer non-qualified stock options by gift to family members, certain trusts, or partnerships. Unless the transfer complies with the applicable award agreement, all applicable securities laws, and the transfer restrictions in the 2023 Plan (including the Company's right of first refusal and repurchase rights), 2023 Plan awards generally may not be sold, pledged, assigned, hypothecated, transferred, or otherwise disposed of or encumbered.

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*Amendment and termination* 

The board may amend or discontinue the 2023 Plan and the 2023 Plan administrator may amend or cancel outstanding awards for purposes of satisfying changes in law or any other lawful purpose, but no such action may adversely affect rights under any outstanding award without the holder's consent. Certain amendments to the 2023 Plan require the approval of the Company's stockholders. The 2023 Plan administrator may exercise its discretion to reduce the exercise price of outstanding stock options or to effect repricing through the cancellation of outstanding stock options and grant of replacement awards.

***2026 equity incentive plan***

Our 2026 Plan will become effective upon the effectiveness of the registration statement of which this prospectus forms a part. Upon the effectiveness of the 2026 Plan, we will cease granting awards under our 2023 Plan. A summary of the material terms of the 2026 Plan follows below.

The 2026 Plan authorizes the award of both equity-based and cash-based incentive awards, including: (i) stock options (both incentive stock options and nonqualified stock options), (ii) stock appreciation rights ("SARs"), (iii) restricted stock awards, (iv) restricted stock units, and (v) cash or other stock-based awards. Incentive stock options may be granted only to employees. All other types of awards may be issued to employees, directors, consultants and other service providers.

*Shares subject to 2026 plan* 

We will initially reserve shares of our common stock for issuance under our 2026 Plan. The number of shares reserved for issuance under our 2026 Plan will increase automatically on January 1, 2027 and each anniversary of such date prior to the termination of the 2023 Plan, equal to the lesser of (A) % of our shares of common stock issued and outstanding on the last day of the immediately preceding fiscal year and (B) such smaller number of shares as determined by our board or compensation committee. No more than shares of our common stock may be issued under the 2023 Plan through incentive stock options.

The following shares will be added (or added back) to the shares available for issuance under the 2026 Plan:

• Shares subject to 2023 Plan or 2026 Plan awards that expire, terminate or are cancelled or forfeited for any reason after
the effectiveness of the 2026 Plan;

• Shares that after the effectiveness of the 2026 Plan are withheld to satisfy the exercise price of an option issued under
our 2023 Plan or 2026 Plan; and

• Shares that after the effectiveness of the 2026 Plan are withheld to satisfy tax withholding obligations related to any
award under our 2023 Plan or 2026 Plan.

Shares of our common stock issued by us through the assumption or substitution of awards in connection with a future acquisition of another entity will not reduce the shares available for issuance under the 2026 Plan.

*Administration* 

We expect that our 2026 Plan will be administered by our compensation committee. The administrator of the plan will have the authority to, among other things, interpret the plan and award agreements, select grantees, determine the vesting, payment and other terms of awards, and modify or amend awards. Our compensation committee may delegate to one or more of our officers the authority to issue awards under the 2026 Plan to grantees who are not executive officers, subject to parameters established by the compensation committee.

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*Adjustments* 

In the event of certain corporate events or transactions (such as a merger, consolidation, reorganization, recapitalization, stock split, reverse stock split, spin-off, stock dividend or similar transaction or change in our capital structure), our compensation committee will make adjustments or substitutions to the number and kind of shares that may be issued under the 2026 Plan, the number and kind of shares subject to outstanding awards, the exercise price or base price of outstanding awards, and/or any other affected terms and conditions of the 2026 Plan or outstanding awards, in each case as it deems appropriate and equitable.

*Stock options* 

The 2026 Plan provides for the grant of both incentive stock options and non-qualified stock options to purchase shares of our common stock at a stated exercise price. The exercise price of stock options granted under the 2026 Plan must be at least equal to the fair market value of our common stock on the date of grant. The maximum term of options granted under our 2026 Plan is ten years.

Our compensation committee may provide in the terms of the applicable award agreement that the participant may exercise an unvested portion in exchange for restricted stock subject to the same vesting terms as the option.

*Stock appreciation rights* 

An SAR provides for a payment, in cash or shares of our common stock or a combination of both, to the holder based upon the difference between the fair market value of our common stock on the date of exercise and a predetermined exercise price, multiplied by the number of shares. The base price of a SAR must be at least the fair market value of a share of our common stock on the date of grant. SARs may not have a term that is longer than ten years from the date of grant.

*Restricted stock awards* 

An RSA is an issuance of shares of our common stock subject to forfeiture restrictions that lapse based on the satisfaction of service and/or performance conditions. The price, if any, of each share subject to an RSA will be determined by the compensation committee. During the vesting period, a participant will have the right to vote and receive any dividends with respect to restricted stock, provided that our compensation committee may specify that any such dividends are subject to the same vesting schedule as the shares to which they relate.

*Restricted stock units* 

Restricted stock units represent the right to receive shares of our common stock (or cash equal to the value of such shares) at a specified time in the future, following the satisfaction of specified service and/or performance conditions.

*Cash or other stock based awards* 

Cash or other stock-based awards (including awards to receive unrestricted shares of our common stock or immediate cash payments) may be granted to participants. Our compensation committee will determine the terms and conditions of each such award, including, as applicable, the term, any exercise or purchase price, performance goals, vesting conditions and other terms and conditions. Payment in respect of a cash or other stock-based award may be made in cash, shares of our common stock, or a combination of both, at the discretion of our compensation committee.

*Change in control* 

Upon or in anticipation of a change in control (which includes certain merger, asset or stock transactions, certain changes in our board composition and any other event deemed by our board of directors to constitute a

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change in control), our compensation committee may take such actions as it deems appropriate with respect to outstanding awards under the 2026 Plan. Such actions may include (among other things) the acceleration of award vesting, the substitution of awards, the cancellation of unexercised or unvested awards and the redemption or cashout of awards. In the discretion of our compensation committee, any cash or other substitute consideration payable upon redemption or cashout of an award may be subjected to the same vesting terms that applied to the original award, or earn-out, escrow, holdback or similar arrangements comparable to those applicable to stockholders in connection with the change in control. The compensation committee need not treat all outstanding awards in an identical manner.

*No repricing without stockholder approval* 

Neither our board of directors nor our compensation committee may, without obtaining prior approval of our stockholders: (i) cancel options or stock appreciation rights outstanding under the 2026 Plan in exchange for new options or stock appreciation rights with a lower exercise or base price per share; (ii) cancel underwater options or stock appreciation rights outstanding under the 2026 Plan in exchange for consideration payable in our equity securities; or (iii) otherwise directly reduce the exercise or base price of options or stock appreciation rights outstanding under the 2026 Plan.

*Clawback* 

Awards under the 2026 Plan will be subject to clawback or recoupment pursuant to any applicable policy, law or exchange listing requirement in effect from time to time.

*Transferability* 

Except for certain estate planning transfers authorized by the compensation committee, awards granted under the 2026 Plan are generally nontransferable except by will or by the laws of descent and distribution.

*Amendment and termination* 

Our board of directors may amend our 2026 Plan at any time, subject to stockholder approval if required by applicable law or exchange listing requirement. The 2026 Plan will terminate ten years after it becomes effective.

***Employee stock purchase plan***

Our board of directors intends to adopt the ESPP prior to closing of this offering, under which we may provide our employees and employees of our participating subsidiaries with an opportunity to purchase of shares of our common stock at a discounted purchase price. The material terms of the ESPP are summarized below. The ESPP is intended to qualify as an "employee stock purchase plan" meeting the requirements of Section 423 of the Code.

*Administration* 

Subject to the express provisions of the ESPP, our compensation committee will have the authority to construe and interpret the ESPP, prescribe, amend and rescind rules relating to the ESPP's administration and take any other actions necessary or desirable for the administration of the ESPP and to facilitate compliance with Section 423 of the Code and other applicable law.

*Stock subject to the ESPP* 

Subject to adjustment as provided in the ESPP, a total of shares of our common stock will be authorized and reserved for issuance under the ESPP. In addition, on January 1, 2027 and on each January 1 thereafter prior to the termination of the ESPP, the number of shares of our common stock authorized and

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reserved for issuance under the ESPP will be increased by a number of shares of our common stock equal to the least of (i) shares of our common stock, (ii) % of the shares of our common stock outstanding on the final day of the immediately preceding calendar year, and (iii) such smaller number of shares of our common stock as determined by our board of directors. Such shares of our common stock may be newly issued shares, treasury shares or shares acquired on the open market. In the event that any dividend or other distribution (whether in the form of cash, our common stock, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, or exchange of our common stock or our other securities, or other change in our structure affecting our common stock occurs, then in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the ESPP, our compensation committee will, in such manner as it deems equitable, adjust the number of shares and class of common stock that may be delivered under the ESPP, the purchase price per share and the number of shares covered by each outstanding option under the ESPP, and the numerical limits described above.

*Eligibility* 

Generally, our employees and employees of our participating subsidiaries who are employed on the first day of an offering period are eligible to participate in such offering period, provided that our compensation committee may determine that employees must satisfy one or more of the following service requirements before participating in the ESPP: (i) continuous employment with us for a minimum period of time (not to exceed two years), (ii) customary employment for at least twenty hours per week and for more than five months in any calendar year, or (iii) such other criteria as the compensation committee may determine consistent with the requirements of Section 423 of the Code. Our compensation committee may also exclude from participation in the ESPP or any offering period employees who are (i) "highly compensated employees" within the meaning of Section 414(q) of the Code or (ii) citizens or residents of a foreign jurisdiction where the grant of an option under the ESPP to such employee would be prohibited under the laws of such foreign jurisdiction or the grant of an option under the ESPP to such employee in compliance with the laws of such foreign jurisdiction would cause the ESPP to violate the requirements of Section 423 of the Code. No employee may be granted options to purchase shares of our common stock under the ESPP if such employee (x) immediately after the grant would own capital stock possessing 5% or more of the total combined voting power or value of all classes of our capital stock, or (y) holds rights to purchase shares of our common stock under all of our employee stock purchase plans (as defined in Section 423 of the Code) that accrue at a rate exceeding $25,000 (determined as of the option grant date) for each calendar year in which such rights are outstanding.

*Grant and exercise of options* 

The ESPP permits us to make one or more offerings each year to our employees to purchase shares under the ESPP, consisting of one or more purchase periods provided that no offering period may exceed 27 months. Eligible employees may elect to become a participant in the ESPP by submitting an enrollment form, pursuant to which an employee may elect to enroll in the ESPP, authorize a new level of payroll deductions, or stop payroll deductions and withdraw from an offering period. However, a participant may not purchase more than shares of our common stock during each offering period.

During each offering period for which a participant has enrolled, the participant may contribute through payroll deductions in an amount equal to (i) between % and %, in whole percentages, of his or her compensation, or (ii) such other maximum as may be specified by the administrator in advance of the offering, in each case, on each pay day occurring during such offering period. A participant's compensation for purposes of the ESPP includes base compensation, but excludes overtime, commissions, incentive or bonus awards, education or tuition reimbursements, imputed income arising under any group insurance or benefit program, travel expenses, business and relocation expenses, income received in connection with stock options or other equity or equity-based awards, incentive compensation (other than annual cash incentive compensation) and

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one-time bonuses (e.g., retention or sign on bonuses). No interest shall accrue on or be payable with respect to the payroll deductions of a participant in the ESPP. Payroll deductions would be made before deduction for any salary deferral contributions made by the employee to any tax-qualified or nonqualified deferred compensation plan.

On the last trading day of each offering period, a participant's option to purchase shares of our common stock will be exercised automatically. The per-share purchase price will be 85 percent of the fair market value of one share of our common stock offering date or the exercise date, whichever is less. As soon as reasonably practicable after the last day of each offering period, we will arrange for the delivery to each participant of the shares of our common stock purchased upon exercise of his or her option. We may require that the shares of our common stock be deposited and/or retained for a specified period of time with a financial services firm or other agent it designates as broker. Neither payroll deductions nor rights with respect to the exercise of an option or to receive shares of our common stock are transferable, other than by will, by the laws of descent and distribution, or by written designation of a beneficiary with our compensation committee.

*Termination of employment and withdrawal from the ESPP* 

Participants may elect to withdraw from the ESPP at any time and receive back any of their contributions, without interest, not used to purchase shares of our common stock; provided that if a participant wishes to withdraw his or her funds prior to purchase, he or she must submit a revised enrollment form to our compensation committee at least fifteen days prior to the end of the then-current offering period (or such other deadline specified by the compensation committee). Participants who terminate employment before the end of an offering period will be deemed to have withdrawn from the ESPP and the payroll deductions in the participant's notional account that have not been used to purchase shares of our common stock will be returned to the participant.

*Amendment and termination of the ESPP* 

Our compensation committee may amend or terminate the ESPP at any time for any reason. If the ESPP is terminated, our compensation committee may elect to terminate the outstanding offering period either immediately, or after shares of our common stock have been purchased on the last trading day of the offering period (which may, in the discretion of our compensation committee, be accelerated) and all amounts that have not been used to purchase shares of our common stock will then be returned to participants as soon as administratively practicable. In the event of a merger, consolidation, acquisition of property or stock, separation, reorganization or other corporate event described in Section 424 of the Code, each outstanding option will be assumed or an equivalent option substituted by the successor corporation or a parent or subsidiary of such successor corporation. If the successor corporation refuses to assume or substitute the option, the offering period with respect to which the option relates will be shortened by setting a new purchase date that occurs before the date of the applicable transaction. Unless terminated earlier pursuant to the terms of the ESPP, the ESPP will have a term of 10 years following the ESPP's effective date.

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**Director compensation** 

**Non-employee director compensation** 

***2025 director compensation table***

The following table presents the total compensation for each person who served as a non-employee director during the fiscal year ended December 31, 2025. Mr. Gianakakos does not receive any additional compensation from us for his service on our board of directors by virtue of his position as chief executive officer of the Company. See the section titled "*Executive Compensation*" for more information on the compensation paid to or earned by Mr. Gianakakos for the fiscal year ended December 31, 2025.

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Fees<br>earned or<br>paid in<br>cash($)(1)** | **Option<br>awards($)(2)(3)** | **Total($)** |
|  Paul Berns | 42692 | 226224 | 268916 |
|  Doug Giordano | 42692 | 226224 | 268916 |
|  David Meeker, M.D. | 42692 | 345747 | 386799 |
|  Kim Popovits | 42692 | 344107 | 386799 |

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(1) Amounts represent annual cash retainers paid to our non-employee directors for service on the board and board committees.

(2) All of the option awards were granted under the 2023 Plan, the terms of which plan are described below under "*Executive Compensation—Equity Incentive Plans—2023 Plan*." The amounts reported
represent the aggregate grant date fair value of the stock options granted to our non-employee directors during the applicable fiscal year, calculated in accordance with FASB ASC 718. The assumptions used in
calculating the grant date fair value of the stock options reported in this column are set forth in Note 11 to our consolidated financial statements included elsewhere in this prospectus. The amounts reported in this column reflect the accounting
cost for the stock options, and do not correspond to the actual economic value that may be received upon exercise of the stock options, issuance of shares of common stock, or any sale of any of the underlying shares of common stock.

(3) The following table provides information regarding the number of shares of common stock underlying stock options granted to our non-employee directors that were outstanding as of
December 31, 2025:

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| | | |
|:---|:---|:---|
| **Name** | **Option<br>awards(#)** | **Option<br>awards(#)** |
|  Paul Berns |  | 50367 |
|  Doug Giordano |  | 50367 |
|  Kim Popovits |  | 70367 |
|  David Meeker |  | 70367 |

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***Pre-IPO non-employee director compensation policy***

In February 2025, our board of directors approved a policy providing for an annual cash retainer for each of our non-employee directors equal to $40,000 per year, plus an additional $7,000 per year for serving on a committee of the board. In addition, in fiscal year 2025, each of our non-employee directors received an option to purchase 50,367 shares of our common stock and Ms. Popovits and Dr. Meeker received an additional option to purchase 20,000 shares of our common stock.

***Post-IPO non-employee director compensation policy***

In connection with this offering, our board of directors intends to adopt a non-employee director compensation policy, to be effective as of the date on which the registration statement of which this prospectus forms a part is declared effective by the SEC. The policy is designed to enable us to attract and retain, on a long-term basis, highly qualified non-employee directors. Under the policy, our non-employee directors will be eligible to receive cash retainers (which will be payable quarterly in arrears and prorated for partial years of service) and equity

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awards as set forth below, provided that our non-employee directors may opt to receive their cash retainers in fully vested shares of our common stock:

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| | |
|:---|:---|
| **Compensation elements: non-employee director compensation policy** | |
|  **Board Service** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Annual Cash Retainer | $|
|  **Annual Committee Chair Retainer** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Audit | $|
| &nbsp;&nbsp;&nbsp;&nbsp; Compensation | $|
| &nbsp;&nbsp;&nbsp;&nbsp; Nominating and Corporate Governance | $|
|  **Annual Committee Member Retainer** |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Audit | $|
| &nbsp;&nbsp;&nbsp;&nbsp; Compensation | $|
| &nbsp;&nbsp;&nbsp;&nbsp; Nominating and Corporate Governance | $|

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In addition, the non-employee director compensation policy will provide that, upon initial election or appointment to our board of directors, each non-employee director will be granted an equity award consisting of . Furthermore, on the date of each annual meeting of stockholders following the completion of this offering, each non-employee director who continues as a non-employee director following such meeting will be granted an annual equity award consisting of .

The aggregate amount of compensation, including both equity compensation and cash compensation, paid to any non-employee director for service as a non-employee director in a calendar year period will not exceed .

We will reimburse all reasonable out-of-pocket expenses incurred by directors for their attendance at meetings of our board of directors or any committee thereof.

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**Certain relationships and related person transactions** 

In addition to the compensation arrangements, including employment, termination of employment and change in control arrangements, and indemnification arrangements discussed, when required, in the sections titled "*Management*" and "*Executive Compensation*" and the registration rights described in the section titled "*Description of Capital Stock—Registration Rights*," the following is a description of all transactions since our date of incorporation and each currently proposed transaction in which:

• we have been or are to be a participant;

• the amounts involved exceeded or will exceed the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal years; and

• any of our directors, executive officers or holders of more than 5% or more of our outstanding capital stock, or any
immediate family member of, or person sharing the household with, any of these individuals or entities or affiliated entities, had or will have a direct or indirect material interest.

**SAFE financing** 

In September 2023, we issued Simple Agreements for Future Equity ("SAFEs") with a principal amount of $250,000 to KCM 2023 Trust. In January 2024 and April 2024, we issued additional SAFEs with a principal amount of $250,000 to KCM 2023 Trust and $350,000 to AEG 2021 Trust, respectively. Tassos Gianakakos, our Chief Executive Officer and Chair, and his family members are trustees of each of KCM 2023 Trust and AEG 2021 Trust. Each SAFE converted into shares of our Series A redeemable convertible preferred stock, as further described below.

**Series A redeemable convertible preferred stock financing** 

In June 2024, we entered into a Series A redeemable convertible preferred stock purchase agreement (the "Series A SPA") under which we issued and sold 2,487,790 shares of Series A redeemable convertible preferred stock, at a price of $19.42 per share, for gross proceeds of $48.3 million (the "Series A Initial Closing"). Contemporaneously, KCM 2023 Trust and AEG 2021 Trust converted their SAFEs having an aggregate principal amount of $850,000 into 43,762 shares of Series A redeemable convertible preferred stock, bringing the total number of shares of Series A redeemable convertible preferred stock issued at the Series A Initial Closing to 2,531,532 shares.

The Series A SPA provided for three additional closings: the initial additional closing, first milestone closing and second milestone closing. The first milestone closing and second milestone closing were each conditioned upon the achievement of milestones specified in the Series A SPA. Investors could also choose to early exercise their tranche rights by providing written notice outside of specified blackout periods.

Subsequent to the Series A Initial Closing, the initial additional closing occurred on July 22, 2024, at which we sold 2,883,206 additional shares of Series A redeemable convertible preferred stock at a price of $19.42 per share for total gross proceeds of $56.0 million. Additionally, the second milestone closing occurred on February 14, 2025, at which we sold 5,148,587 additional shares of Series A redeemable convertible stock at a price of $19.42 per share, resulting in total gross proceeds of $100.0 million. The first milestone closing occurred on August 27, 2025, at which we sold 5,148,587 additional shares of Series A redeemable convertible stock at a price of $19.42 per share, resulting in additional total gross proceeds of $100.0 million. The following

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table summarizes the shares of our Series A redeemable convertible preferred stock issued to our related parties:

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| | | | |
|:---|:---|:---|:---|
| **Purchasers(1)** | **Series A<br>redeemable<br>convertible<br>preferred<br>stock** | **Total<br>purchase<br>price** | **Total SAFE<br>balance<br>exchanged<br>for Series A<br>redeemable<br>convertible<br>preferred<br>stock** |
|  Entities affiliated with ARCH(2) | 5148587 | $99999976 |  |
|  Entities affiliated with Perceptive(3) | 5148583 | $99999894 |  |
|  Entities affiliated with HRTG Partners(4) | 5148586 | $99999956 |  |
|  KCM 2023 Trust(5) | 25742 |  | $500000 |
|  AEG 2021 Trust(6) | 18020 |  | $350000 |

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(1) Additional details regarding these stockholders and their equity holdings are included in the section titled "*Principal Stockholders*."

(2) Entities affiliated with ARCH beneficially own more than 5% of our outstanding capital stock. Paul Berns, a member of our board of directors, was designated to our board of directors by ARCH and is a managing director
at ARCH.

(3) Entities affiliated with Perceptive beneficially own more than 5% of our outstanding capital stock. Douglas Giordano, a member of our board of directors, was designated to our board of directors by Perceptive and is a
managing director at Perceptive.

(4) Entities affiliated with HRTG Partners beneficially own more than 5% of our outstanding capital stock.

(5) Mr. Gianakakos and his family members are trustees of KCM 2023 Trust.

(6) Mr. Gianakakos and his family members are trustees of AEG 2021 Trust.

**Series B redeemable convertible preferred stock financing** 

In September 2025, we entered into a Series B redeemable convertible preferred stock purchase agreement (the "Series B SPA") under which we issued and sold 4,082,529 shares of Series B redeemable convertible preferred stock and 2,610,635 shares of Series B-1 redeemable convertible preferred stock, at a price of $21.37 per share for each series, for total gross proceeds of $143.0 million (the "Series B Initial Closing"). In addition, we issued warrants to purchase 550,000 shares of our common stock to each of ARCH and HRTG Partners, with an exercise price of $21.37 per share.

The Series B SPA provided for two additional closings within 90 days and 120 days, respectively, of the Series B Initial Closing. The additional closings were conditioned upon the investors being made party to the Investors' Rights Agreement, Voting Agreement, and Right of First Refusal and Co-Sale Agreement, each initially dated as of September 4, 2025.

Subsequent to the Series B Initial Closing, the first additional closing occurred on October 9, 2025, at which we sold 4,025,257 additional shares of Series B redeemable convertible preferred stock at the same price of $21.37 per share for total gross proceeds of $86.0 million. Additionally, the second additional closing was consummated on October 15, 2025, at which we sold 1,170,134 additional shares of Series B-1 redeemable convertible preferred stock at a price of $21.37 per share for total gross proceeds of $25.0 million.

We also completed an additional closing on March 20, 2026, at which we sold 468,053 additional shares of Series B redeemable convertible preferred stock at the price of $21.37 per share for total gross proceeds of $10.0 million.

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The following table summarizes the shares of our Series B and Series B-1 redeemable convertible preferred stock issued to our related parties:

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| | | |
|:---|:---|:---|
| **Purchasers(1)** | **Series B<br>redeemable<br>convertible<br>preferred<br>stock** | **Total<br>purchase<br>price** |
|  Entities affiliated with ARCH(2) | 3510401 | $74999998 |
|  Entities affiliated with HRTG Partners(3) | 3978454 | $84999988 |
|  Entities affiliated with Fidelity(4) | 2732176 | $58373159 |

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(1) Additional details regarding these stockholders and their equity holdings are included in the section titled "*Principal Stockholders*."

(2) Entities affiliated with ARCH beneficially own more than 5% of our outstanding capital stock. Paul Berns, a member of our board of directors, was designated to our board of directors by ARCH and is a managing director
at ARCH.

(3) Entities affiliated with HRTG Partners beneficially own more than 5% of our outstanding capital stock.

(4) Entities affiliated with Fidelity beneficially own more than 5% of our outstanding capital stock.

***Acquisition of Prolaio***

On February 24, 2025, we entered into an Agreement and Plan of Merger (the "Prolaio Merger Agreement"), with Prolaio, Inc. ("Prolaio"), a clinical intelligence company, pursuant to which we acquired 100% of the outstanding capital stock of Prolaio. Mr. Gianakakos was the Chief Executive Officer of Prolaio and also served as a director. Jay Edelberg, our Chief Medical Officer, was Head of Research and Development of Prolaio and also served as a director. Mr. Gianakakos and Dr. Edelberg owned 55.7% and 16.6%, respectively, of Prolaio at the time of its acquisition by us. Through our acquisition of Prolaio, we gained access to its cardiovascular data collection and analytics platform.

Upon the consummation of the merger, Prolaio became our wholly-owned subsidiary. Pursuant to the merger agreement, and subject to the conditions therein, the former stockholders of Prolaio, including Mr. Gianakakos and Dr. Edelberg, are entitled to certain milestone payments upon the achievement of post-closing milestones in an amount of up to $200 million in the aggregate, to be allocated among such former stockholders on a pro rata basis in accordance with their respective ownership interests in Prolaio immediately prior to the acquisition. Such milestone payments shall be payable in cash or shares as consideration in exchange for the prior cancellation of the issued and outstanding shares of common stock of Prolaio.

***Demand note with Tassos Gianakakos***

On May 30, 2024, we issued a demand promissory note (the "Demand Note") in the principal amount of $225,269.77 to Mr. Gianakakos for funds to meet our working capital needs. The Demand Note was payable on demand on or after June 3, 2024. The Demand Note accrued interest at the rate of 6.0% per annum and could be prepaid in whole or in part at any time without prepayment premium or penalty. We repaid the Demand Note in full in July 2024 with proceeds from the Series A financing.

***Founder shares modification***

On June 5, 2024, Mr. Gianakakos, as an individual and through his family's trusts, and Dr. Edelberg each provided a notice of conversion (the "Notices of Conversion") of their existing Series FF-1 Preferred Stock, Class F-1 Common Stock, Series FF-2 Preferred Stock and Class F-2 Common Stock. Effective as of the date of the Notices of Conversion, each Series FF-1 Preferred Stock and Series FF-2 Preferred Stock converted to zero (0) shares of Class F-1 Common Stock and Class F-2 Common Stock, respectively. Each share of Class F-1 Common Stock and Class F-2 Common Stock was converted on a one-for-one basis into Class A common stock. As a result of the conversions specified in the Notices of Conversion, our existing Series FF-1 Preferred Stock,

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Class F-1 common stock, Series FF-2 Preferred Stock and Class F-2 Common Stock were converted to 7,500,000 shares of Class A common stock. On June 6, 2024, all outstanding shares of our Class A common stock were reclassified into shares of our common stock.

***Prolaio bonus integration agreements***

On February 24, 2025, in connection with the Prolaio Merger Agreement, we entered into agreements (the "Bonus Agreements") with each of Mr. Gianakakos and Dr. Edelberg pursuant to which Mr. Gianakakos and Dr. Edelberg were granted a right to a bonus in the amount of $9.0 million and $2.0 million, respectively, of shares of common stock issued in our initial public offering or convertible preferred stock, as applicable (the "bonus equity securities"), as well as certain additional amounts of bonus equity securities to cover a portion of all applicable federal, state and local income and employment taxes applicable to the bonus amounts, upon the closing and our successful integration of Prolaio. We also agreed that if the bonus equity securities issued in connection with the Bonus Agreements were not freely tradeable securities, we would loan each of Mr. Gianakakos and Dr. Edelberg an amount necessary to cover all applicable federal, state and local taxes applicable to the bonuses.

The Bonus Agreements became payable upon completion of the Series B Initial Closing. On September 4, 2025, in connection with the Series B Initial Closing, we entered into bonus integration agreements (the "Bonus Integration Agreements") with each of Mr. Gianakakos and Dr. Edelberg. The Bonus Integration Agreements modified the Bonus Agreements such that (i) each recipient agreed to forfeit Series B Preferred Stock to satisfy the tax withholding obligations, (ii) certain payments required to be made under the Bonus Agreements would be remitted to federal and state tax authorities via payroll for certain tax liabilities required to be satisfied by us through payroll and (iii) no loan will be issued to the recipient. Pursuant to the Bonus Integration Agreements, and net for tax withholding obligations, (i) Mr. Gianakakos received 313,092 shares of Series B Preferred Stock and we remitted $4,912,141.96 directly to federal and state tax authorities via payroll in satisfaction of certain tax liabilities and $136,104 directly to Mr. Gianakakos in satisfaction of certain tax liabilities and (ii) Dr. Edelberg received 61,268 shares of Series B Preferred Stock and we remitted $1,314,246.49 directly to federal and state tax authorities via payroll in satisfaction of certain tax liabilities.

**Agreements with stockholders** 

***Investors' rights agreement***

We are a party to an amended and restated investors' rights agreement, dated as of September 4, 2025 ("Investors' Rights Agreement"), with the holders of our redeemable convertible preferred stock and certain holders of our common stock, including entities affiliated with certain of our directors.

The Investors' Rights Agreement provides certain holders of our redeemable convertible preferred stock with a participation right to purchase their pro rata share of new securities that we may propose to sell and issue, subject to certain exceptions. Such participation right will terminate upon the completion of this offering. The Investors' Rights Agreement further provides certain holders of our redeemable convertible preferred stock with certain rights, including certain registration rights with respect to the registrable securities held by them. See the section titled "*Description of Capital Stock—Registration Rights*" for additional information.

***Voting agreement***

We entered into an amended and restated voting agreement, dated as of September 4, 2025 (the "Voting Agreement"), with the holders of our redeemable convertible preferred stock and certain holders of our common stock, including entities affiliated with certain of our directors. Pursuant to the voting agreement, we

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agreed to appoint to our board of directors one representative designated by Perceptive, currently Douglas Giordano, one representative designated by ARCH, currently Paul Berns, our Chief Executive Officer, Tassos Gianakakos, and two independent directors. The Voting Agreement will terminate upon the closing of this offering, and members previously elected to our board of directors pursuant to this agreement will continue to serve as directors until they resign, are removed or their successors are duly elected by holders of our common stock. The composition of our board of directors after this offering is described in more detail under the section titled "*Management—Board Composition*."

***Right of refusal and co-sale agreement***

We entered into the amended and restated right of first refusal and co-sale agreement, dated as of September 4, 2025 (the "ROFR Agreement"), with the holders of our redeemable convertible preferred stock and certain holders of our common stock, including entities affiliated with certain of our directors. Pursuant to the ROFR Agreement, we have a right of first refusal on certain transfers of our shares by the key holders, certain significant holders of our redeemable convertible preferred stock have a secondary right of first refusal on such transfers, and such redeemable convertible preferred stockholders have a right of co-sale to participate in respect of such transfers on a pro rata basis. The ROFR Agreement will terminate upon the completion of this offering.

***Management rights and side letters***

In connection with the initial issuance and sale of our redeemable convertible preferred stock, we entered into management rights and side letters with certain purchasers of our redeemable convertible preferred stock, including entities affiliated with certain of our directors. Pursuant to these agreements, such entities were granted certain management rights, including, among other things, the right to consult with and advise our management on significant business issues, review our operating plans, examine our books and records, inspect our facilities and to receive information concerning the general status of our financial condition and operations, all subject to certain exceptions for highly confidential proprietary information and attorney-client privileged materials. Except for certain confidentiality obligations, publicity restrictions and provisions related to material non-public information, all rights under these management rights and side letters will terminate upon completion of this offering.

**Employment arrangements** 

We have entered into offer letter agreements with certain of our executive officers, and granted stock options to our executive officers, as more fully described in the section titled "*Executive Compensation*."

**Equity grants** 

We have granted options to purchase shares of our common stock to certain of our executive officers and directors. For more information regarding the options granted to our executive officers and directors, see the sections titled "*Executive Compensation*" and "*Director Compensation*" included elsewhere in this prospectus.

**Indemnification agreements** 

Our third amended and restated certificate of incorporation will contain provisions limiting the liability of directors and officers, and our amended and restated bylaws will provide that we will indemnify each of our directors and officers to the fullest extent permitted under Delaware law. Our third amended and restated certificate of incorporation and amended and restated bylaws will also provide our board of directors with discretion to indemnify our employees and other agents when determined appropriate by our board of

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directors. In addition, we have entered into or intend to enter into an indemnification agreement with each of our directors and executive officers, which will require us to indemnify them. For more information regarding these agreements, see the section titled "*Management—Limitations on Liability and Indemnification Agreements*" included elsewhere in this prospectus.

**Policies and procedures for transactions with related persons** 

Prior to completion of this offering, we intend to adopt a written policy that our executive officers, directors, nominees for election as a director, beneficial owners of more than 5% of any series of our common stock, and any members of the immediate family of any of the foregoing persons are not permitted to enter into a related person transaction with us without the approval or ratification of our board of directors or our audit committee. Any request for us to enter into a transaction with an executive officer, director, nominee for election as a director, beneficial owner of more than 5% of any series of our common stock, or any member of the immediate family of any of the foregoing persons, in which the amount involved exceeds $120,000 (or, if less, 1% of the average of our total assets in a fiscal year) and such person would have a direct or indirect interest, must be presented to our board of directors or our audit committee for review, consideration, and approval. In approving or rejecting any such proposal, our board of directors or our audit committee is to consider the material facts of the transaction, including whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person's interest in the transaction.

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**Principal stockholders** 

The following table sets forth information regarding beneficial ownership of our capital stock as of , 2026 by:

• each person, or group of affiliated persons, known by us to beneficially own more than 5% of our common stock;

• each of our directors;

• each of our named executive officers; and

• all of our current executive officers and directors as a group.

We have determined beneficial ownership in accordance with the rules of the SEC. Under these rules, beneficial ownership includes any shares of common stock as to which the individual or entity has sole or shared voting power or investment power. Unless otherwise indicated below, to our knowledge the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to community property laws where applicable. We have deemed shares of common stock subject to options that are currently exercisable or exercisable within 60 days of to be outstanding and to be beneficially owned by the person holding the option for the purpose of computing the percentage ownership of that person but have not treated them as outstanding for the purpose of computing the percentage ownership of any other person.

Applicable percentage ownership before the offering is based on an aggregate of shares of common stock (which includes shares of restricted common stock) deemed to be outstanding as of , after giving effect to the automatic conversion of all outstanding shares of redeemable convertible preferred stock into 29,987,476 shares of common stock upon the completion of this offering, and assuming an initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus.

Applicable percentage ownership after the offering is based on shares of common stock assumed to be outstanding immediately after the completion of this offering (assuming the sale of shares of common stock in this offering and no exercise of the underwriters' option to purchase additional shares).

Unless otherwise indicated, the address for each beneficial owner listed in the table below is c/o Kardigan, Inc., 131 Oyster Point Blvd., Second Floor, South San Francisco, CA 94080.

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| | | | |
|:---|:---|:---|:---|
| | | **Percentage of shares<br>beneficially owned** | **Percentage of shares<br>beneficially owned** |
| <br>**Name of beneficial owner** |<br>**Number of shares<br>beneficially owned** | **Before<br>offering** | **After<br>offering** |
|  **5% or Greater Shareholders:** |  |  |  |
|  Entities affiliated with ARCH |  |  |  |
|  Entities affiliated with HRTG Partners |  |  |  |
|  Entities affiliated with Perceptive |  |  |  |
|  Entities affiliated with Fidelity |  |  |  |
|  **Named Executive Officers and Directors:** |  |  |  |
|  Tassos Gianakakos, *Chief Executive Officer, Director, and Chair* |  |  |  |
|  Jay Edelberg, M.D., Ph.D., *Chief Medical Officer* |  |  |  |
|  Brianne Puglisi, *Chief Financial Officer* |  |  |  |
|  Paul Berns |  |  |  |
|  David Meeker, M.D. |  |  |  |
|  Douglas Giordano |  |  |  |
|  Kim Popovits |  |  |  |
|  All executive officers and directors as a group (8 persons) |  |  |  |

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\* Represents beneficial ownership of less than 1%.

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**Description of capital stock** 

**General** 

The following description of our capital stock and certain provisions of our third amended and restated certificate of incorporation and amended and restated bylaws are summaries and are qualified by reference to the third amended and restated certificate of incorporation, which will become effective upon the completion of this offering, and the amended and restated bylaws, which will become effective upon the effectiveness of the registration statement of which this prospectus forms a part. Copies of these documents have been filed with the SEC as exhibits to our registration statement, of which this prospectus forms a part. The descriptions of the common stock and preferred stock reflect changes to our capital structure that will be in effect on the completion of this offering.

Upon filing of our third amended and restated certificate of incorporation and the completion of this offering, our authorized capital stock will consist of shares of common stock, par value $0.00001 per share, and shares of preferred stock, par value $0.00001 per share, all of which shares of preferred stock will be undesignated.

As of December 31, 2025, there were 40,253,113 shares of common stock outstanding (which includes 625,000 shares of unvested restricted common stock and 736,481 shares issued upon early exercise of common stock options that remain subject to repurchase) and held of record by 23 stockholders. This amount assumes the conversion of all outstanding shares of our redeemable convertible preferred stock into common stock, which will occur upon the completion of this offering.

**Common stock** 

Holders of our common stock are entitled to one vote for each share held on all matters submitted to a vote of the stockholders. The holders of our common stock do not have any cumulative voting rights. Holders of our common stock are entitled to receive ratably any dividends declared by our board of directors out of funds legally available for that purpose, subject to any preferential dividend rights of any outstanding preferred stock. Our common stock has no preemptive rights, conversion rights or other subscription rights or redemption or sinking fund provisions.

In the event of our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in all assets remaining after payment of all debts and other liabilities and any liquidation preference of any outstanding preferred stock. The shares to be issued by us in this offering will be, when issued and paid for, validly issued, fully paid and non-assessable.

**Preferred stock** 

Upon the completion of this offering, all outstanding shares of our redeemable convertible preferred stock will be converted into shares of our common stock. Upon the consummation of this offering, our board of directors will have the authority, without further action by our stockholders, to issue up to shares of preferred stock in one or more series and to fix the rights, preferences, privileges, and restrictions thereof. These rights, preferences, and privileges could include dividend rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking fund terms, and the number of shares constituting, or the designation of, such series, any or all of which may be greater than the rights of common stock. The issuance of our preferred stock could adversely affect the voting power of holders of common stock and the likelihood that such holders will receive dividend payments and payments upon our liquidation. In addition, the issuance of preferred stock could have the effect of delaying, deferring or preventing a change in control of our Company or other

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corporate action. Immediately after consummation of this offering, no shares of preferred stock will be outstanding, and we have no present plan to issue any shares of preferred stock.

**Stock options** 

As of December 31, 2025, 8,177,647 shares of common stock were issuable upon the exercise of outstanding stock options under the 2023 Plan, at a weighted-average exercise price of $4.36 per share; no shares of common stock were issuable upon exercise of outstanding stock options outside of our 2023 Plan; and shares of our common stock reserved for future issuance under the 2026 Plan, which will become effective once the registration statement of which this prospectus forms a part is declared effective, as well as any future automatic annual increases in the number of shares of common stock reserved for issuance under the 2026 Plan and any shares underlying outstanding stock awards granted under the 2023 Plan, that expire or are repurchased, forfeited, cancelled, or withheld. For additional information regarding terms of our equity incentive plans, see the section titled "*Executive Compensation—Equity Incentive Plans*."

**Warrants** 

As of December 31, 2025, 1,100,000 shares of common stock were issuable upon the exercise of outstanding warrants, with an exercise price of $21.37 per share.

**Registration rights** 

Upon the completion of this offering and subject to the lock-up agreements entered into in connection with this offering and federal securities laws, certain holders of shares of our common stock, including those shares of our common stock that will be issued upon the conversion of our redeemable convertible preferred stock in connection with this offering, will initially be entitled to certain rights with respect to registration of such shares under the Securities Act. These shares are referred to as registrable securities. The holders of these registrable securities possess registration rights pursuant to the terms of our third amended and restated investors' rights agreement and are described in additional detail below. The registration of shares of our common stock pursuant to the exercise of the registration rights described below would enable the holders to trade these shares without restriction under the Securities Act when the applicable registration statement is declared effective. We will pay all registration expenses, other than underwriting discounts, selling commissions and stock transfer taxes, of the shares registered pursuant to the demand, piggyback and Form S-3 registrations described below.

Generally, in an underwritten offering, the managing underwriter, if any, has the right, subject to specified conditions and limitations, to limit the number of shares the holders may include. The demand, piggyback and Form S-3 registration rights described below will expire no later than three years after the completion of this offering.

***Demand registration rights***

Upon the completion of this offering, certain holders of our common stock, including those issuable upon the conversion of shares of our redeemable convertible preferred stock upon completion of this offering, will be entitled to certain demand registration rights. At any time beginning 180 days after the completion of this offering, the holders of at least a majority of these shares may request that we register all or a portion of their shares. We are not required to effect more than one registration statement which is declared or ordered effective. Such request for registration must cover at least 40% of these shares then outstanding or a lesser percent if the anticipated aggregate offering price, net of selling expenses, is at least $15 million. With certain

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exceptions, we are not required to effect the filing of a registration statement during the period starting with the date of the filing of, and ending on a date 180 days following the effective date of the registration statement for this offering.

***Piggyback registration rights***

In connection with this offering, certain holders of our common stock, including those issuable upon the conversion of shares of our redeemable convertible preferred stock upon completion of this offering, were entitled to, and the necessary percentage of holders waived, their rights to notice of this offering and to include their shares of registrable securities in this offering. After this offering, in the event that we propose to register any of our securities under the Securities Act, either for our own account or for the account of other security holders, the holders of these shares will be entitled to certain piggyback registration rights allowing the holder to include their shares in such registration, subject to certain marketing and other limitations.

***Short-form registration rights***

Upon the completion of this offering, certain holders of our common stock, including those issuable upon the conversion of shares of our redeemable convertible preferred stock upon completion of this offering, will be entitled to certain Form S-3 registration rights. Holders of at least 25% of these shares can make a request that we register their shares on Form S-3 if we are qualified to file a registration statement on Form S-3 and if the reasonably anticipated aggregate net proceeds of the shares offered would equal or exceed $5 million. We will not be required to effect more than two registrations on Form S-3 within any twelve-month period. The right to have such shares registered on Form S-3 is further subject to other specified conditions and limitations.

***Expiration of registration rights***

The demand registration rights and short-form registration rights granted under the investor rights agreement will terminate upon the earliest of (i) the closing of a "Deemed Liquidation Event," as such term is defined in our amended and restated certificate of incorporation (as currently in effect), (ii) with respect to each stockholder, such date, on or after the completion of this offering, on which all registrable shares held by such stockholder may immediately be sold during any three-month period pursuant to Rule 144 of the Securities Act or another similar exemption and (iii) the third anniversary of the completion of this offering.

**Anti-takeover effects of our certificate of incorporation and bylaws and Delaware law** 

Some provisions of Delaware law, our third amended and restated certificate of incorporation and our amended and restated bylaws will include a number of provisions that may have the effect of delaying, deferring or preventing another party from acquiring control of us and encouraging persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with our board of directors rather than pursue non-negotiated takeover attempts. These provisions include the items described below.

***Board composition and filling vacancies***

Our third amended and restated certificate of incorporation will provide for the division of our board of directors into three classes serving staggered three-year terms, with one class being elected each year. Our third amended and restated certificate of incorporation also will provide that directors may be removed only for cause and then only by the affirmative vote of the holders of two-thirds or more of the shares then entitled to vote at an election of directors. Furthermore, any vacancy on our board of directors, however occurring, including a vacancy resulting from an increase in the size of our board, may only be filled by the affirmative vote of a majority of our directors then in office even if less than a quorum. The classification of directors, together with the limitations on removal of directors and treatment of vacancies, has the effect of making it more difficult for stockholders to change the composition of our board of directors.

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***No written consent of stockholders***

Our third amended and restated certificate of incorporation provides that all stockholder actions are required to be taken by a vote of the stockholders at an annual or special meeting, and that stockholders may not take any action by written consent in lieu of a meeting. This limit may lengthen the amount of time required to take stockholder actions and would prevent the amendment of our amended and restated bylaws or removal of directors by our stockholders without holding a meeting of stockholders.

***Meetings of stockholders***

Our third amended and restated certificate of incorporation and amended and restated bylaws provide that only a majority of the members of our board of directors then in office may call special meetings of stockholders and only those matters set forth in the notice of the special meeting may be considered or acted upon at a special meeting of stockholders. Our bylaws limit the business that may be conducted at an annual meeting of stockholders to those matters properly brought before the meeting.

***Advance notice requirements***

Our amended and restated bylaws establish advance notice procedures with regard to stockholder proposals relating to the nomination of candidates for election as directors or new business to be brought before meetings of our stockholders. These procedures provide that notice of stockholder proposals must be timely given in writing to our corporate secretary prior to the meeting at which the action is to be taken. Generally, to be timely, notice must be received at our principal executive offices not less than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for the preceding year. Our amended and restated bylaws specify the requirements as to form and content of all stockholders' notices. These requirements may preclude stockholders from bringing matters before the stockholders at an annual or special meeting.

***Amendment to certificate of incorporation and bylaws***

Any amendment of our third amended and restated certificate of incorporation must first be approved by a majority of our board of directors, and if required by law or our third amended and restated certificate of incorporation, must thereafter be approved by a majority of the outstanding shares entitled to vote on the amendment and a majority of the outstanding shares of each class entitled to vote thereon as a class, except that the amendment of the provisions relating to stockholder action, board composition, and limitation of liability must be approved by not less than two-thirds of the outstanding shares entitled to vote on the amendment, and not less than two-thirds of the outstanding shares of each class entitled to vote thereon as a class. Our amended and restated bylaws may be amended by the affirmative vote of a majority of the directors then in office, subject to any limitations set forth in the amended and restated bylaws; and may also be amended by the affirmative vote of a majority of the outstanding shares entitled to vote on the amendment, voting together as a single class, except that the amendment of the provisions relating to notice of stockholder business and nominations and special meetings must be approved by not less than two-thirds of the outstanding shares entitled to vote on the amendment, and not less than two-thirds of the outstanding shares of each class entitled to vote thereon as a class, or, if our board of directors recommends that the stockholders approve the amendment, by the affirmative vote of the majority of the outstanding shares entitled to vote on the amendment, in each case voting together as a single class.

***Undesignated preferred stock***

Our third amended and restated certificate of incorporation provides for authorized shares of preferred stock. The existence of authorized but unissued shares of preferred stock may enable our board of directors to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest, or

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otherwise. For example, if in the due exercise of its fiduciary obligations, our board of directors were to determine that a takeover proposal is not in the best interests of our stockholders, our board of directors could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer or insurgent stockholder or stockholder group. In this regard, our third amended and restated certificate of incorporation grants our board of directors broad power to establish the rights and preferences of authorized and unissued shares of preferred stock. The issuance of shares of preferred stock could decrease the amount of earnings and assets available for distribution to holders of shares of common stock. The issuance may also adversely affect the rights and powers, including voting rights, of these holders and may have the effect of delaying, deterring or preventing a change in control of us.

**Section 203 of the Delaware general corporation law** 

Upon completion of this offering, we will be subject to the provisions of Section 203 of the DGCL. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a three-year period following the time that this stockholder becomes an interested stockholder, unless the business combination is approved in a prescribed manner. Under Section 203, a business combination between a corporation and an interested stockholder is prohibited unless it satisfies one of the following conditions:

• before the stockholder became interested, our board of directors approved either the business combination or the
transaction which resulted in the stockholder becoming an interested stockholder;

• upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers,
and employee stock plans, in some instances, but not the outstanding voting stock owned by the interested stockholder; or

• at or after the time the stockholder became interested, the business combination was approved by our board of directors and
authorized at an annual or special meeting of the stockholders by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 defines a business combination to include:

• any merger or consolidation involving the corporation and the interested stockholder;

• any sale, transfer, lease, pledge, or other disposition involving the interested stockholder of 10% or more of the assets
of the corporation;

• subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the
corporation to the interested stockholder;

• subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share
of the stock of any class or series of the corporation beneficially owned by the interested stockholder; and

• the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges, or other financial
benefits provided by or through the corporation.

In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by the entity or person.

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**Choice of forum** 

Our amended and restated bylaws will provide that the Court of Chancery of the State of Delaware is the sole and exclusive forum for the following claims or causes of action under the Delaware statutory or common law: (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of, or a claim based on, a breach of a fiduciary duty owed by any of our current or former directors, officers, or other employees or stockholders to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our third amended and restated certificate of incorporation or amended and restated bylaws (including the interpretation, validity or enforceability thereof) or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware, or (iv) any action asserting a claim governed by the internal affairs doctrine.

In addition, our amended and restated bylaws will provide that, unless we consent in writing to the selection of an alternative forum, to the fullest extent permitted by law, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause or causes of action arising under the Securities Act, including all causes of action asserted against any defendant to such complaint. For the avoidance of doubt, this provision is intended to benefit and may be enforced by us, our officers and directors, the underwriters to any offering giving rise to such complaint, and any other professional entity whose profession gives authority to a statement made by that person or entity and who has prepared or certified any part of the documents underlying the offering.

While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will be enforced by a court in those other jurisdictions. We note that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder.

Additionally, our amended and restated bylaws will provide that any person or entity holding, owning or otherwise acquiring any interest in any of our securities shall be deemed to have notice of and consented to these provisions.

**Limitations on liability and indemnification** 

See the section titled "*Management—Limitations on Liability and Indemnification Agreements*" included elsewhere in this prospectus.

**Exchange listing** 

Our common stock is currently not listed on any securities exchange. We intend to apply to have our common stock approved for listing on under the symbol "KARD."

**Transfer agent and registrar** 

On the completion of this offering, the transfer agent and registrar for our common stock will be . The transfer agent's address is .

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**Shares eligible for future sale** 

Prior to this offering, there has been no public market for our common stock. Future sales of substantial amounts of our common stock, including shares issued on the exercise of outstanding options, in the public market after this offering, or the possibility of these sales or issuances occurring, could adversely affect the prevailing market price for our common stock or impair our ability to raise equity capital. Although we intend to apply to list our common stock on , we cannot assure you that there will be an active public market for our common stock.

Following the completion of this offering, based on our shares outstanding as of , 2026, a total of shares of common stock will be outstanding, assuming no exercise of the underwriters' option to purchase additional shares and no exercise of outstanding options. Of the outstanding shares, all of the shares sold in this offering will be freely tradable, except that any shares held by our affiliates, as that term is defined in Rule 144 under the Securities Act, may only be sold in compliance with the limitations described below.

All remaining shares of common stock held by existing stockholders upon the completion of this offering will be "restricted securities" as such term is defined in Rule 144 under the Securities Act. These restricted securities were issued and sold by us in private transactions and are eligible for public sale only if registered under the Securities Act or if they qualify for an exemption from registration under the Securities Act, including the exemptions provided by Rule 144 or Rule 701, summarized below.

**Rule 144** 

In general, under Rule 144 as currently in effect, once we have been subject to public company reporting requirements of Section 13 or Section 15(d) of the Exchange Act for at least 90 days, an eligible stockholder is entitled to sell such shares without complying with the manner of sale, volume limitation, or notice provisions of Rule 144, subject to compliance with the public information requirements of Rule 144. To be an eligible stockholder under Rule 144, such stockholder must not be deemed to have been one of our affiliates for purposes of the Securities Act at any time during the 90 days preceding a sale and must have beneficially owned the shares proposed to be sold for at least six months, including the holding period of any prior owner other than our affiliates. If such a person has beneficially owned the shares proposed to be sold for at least one year, including the holding period of any prior owner other than our affiliates, then such person is entitled to sell such shares without complying with any of the requirements of Rule 144, subject to the expiration of the lock-up agreements described below.

In general, under Rule 144, as currently in effect, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell shares on expiration of the lock-up agreements described below. Beginning 90 days after the date of this prospectus, within any three-month period, such stockholders may sell a number of shares that does not exceed the greater of:

• 1% of the number of shares of common stock then outstanding, which will equal approximately
    shares immediately after this offering, assuming no exercise of the underwriters' option to purchase additional shares of common stock from us; or

• the average weekly trading volume of our common stock on    during the four calendar weeks
preceding the filing of a notice on Form 144 with respect to such sale.

Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us.

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**Rule 701** 

Rule 701 under the Securities Act ("Rule 701") generally allows a stockholder who was issued shares under a written compensatory plan or contract and who is not deemed to have been an affiliate of our company during the immediately preceding 90 days, to sell these shares in reliance on Rule 144, but without being required to comply with the public information, holding period, volume limitation, or notice provisions of Rule 144. Rule 701 also permits affiliates of our company to sell their Rule 701 shares under Rule 144 without complying with the holding period requirements of Rule 144. All holders of Rule 701 shares, however, are required by that rule to wait until 90 days after the date of this prospectus before selling those shares under Rule 701, subject to the expiration of the lock-up agreements described below.

**Form S-8 registration statements** 

We intend to file one or more registration statements on Form S-8 under the Securities Act with the SEC to register the offer and sale of shares of our common stock that are issuable under the 2023 Plan, the 2026 Plan, and the ESPP. These registration statements will become effective immediately upon filing. Shares covered by these registration statements will then be eligible for sale in the public markets, subject to vesting restrictions, any applicable lock-up agreements described below, and Rule 144 limitations applicable to affiliates.

**Lock-up arrangements** 

We, all of our directors and executive officers, and the holders of substantially all of our capital stock and securities convertible into or exchangeable for our capital stock have entered into lock-up agreements with the underwriters and/or are subject to market standoff agreements or other agreements with us, which prevents them from selling any of our common stock or any securities convertible into or exercisable or exchangeable for common stock for a period of not less than 180 days from the date of this prospectus without the prior written consent of J.P. Morgan Securities LLC, Jefferies LLC, Leerink Partners LLC and TD Securities (USA) LLC, subject to certain exceptions. See the section titled "*Underwriting*" appearing elsewhere in this prospectus for more information.

**Registration rights** 

Upon completion of this offering, certain holders of our securities will be entitled to various rights with respect to registration of their shares under the Securities Act. Registration of these shares under the Securities Act would result in these shares becoming fully tradable without restriction under the Securities Act immediately upon the effectiveness of the registration. See the section titled "*Description of Capital Stock—Registration rights*" appearing elsewhere in this prospectus for more information.

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**Material U.S. federal income tax consequences for non-U.S. holders** 

The following discussion is a summary of material U.S. federal income tax consequences to non-U.S. holders (as defined below) of the purchase, ownership and disposition of our common stock issued pursuant to this offering. This discussion is based on the Internal Revenue Code of 1986, as amended (referred to as the "Code"), Treasury Regulations promulgated thereunder, published rulings and administrative pronouncements of the U.S. Internal Revenue Service (the "IRS") and judicial decisions, all as in effect on the date hereof. These authorities are subject to differing interpretations and may change, possibly with retroactive effect, resulting in U.S. federal income tax consequences different from those discussed below. We have not requested a ruling from the IRS with respect to the statements made and the conclusions reached in the following summary, and there can be no assurance that the IRS or a court will agree with such statements and conclusions.

This discussion is limited to non-U.S. holders who purchase our common stock pursuant to this offering and who hold our common stock as a "capital asset" within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion is not a complete analysis of all potential U.S. federal income tax consequences relating thereto, does not address the potential application of the Medicare contribution tax on net investment income, the alternative minimum tax, or the special tax accounting rules under Section 451(b) of the Code, and also does not address any U.S. federal non-income tax consequences, such as estate or gift tax consequences, or any tax consequences arising under any state, local or non-U.S. tax laws. This discussion does not address all of the U.S. federal income tax consequences that may be relevant to a non-U.S. holder in light of such non-U.S. holder's particular circumstances. This discussion also does not consider any specific facts or circumstances that may be relevant to non-U.S. holders subject to special rules under the U.S. federal income tax laws, including:

• certain former citizens, or long-term residents of the United States;

• partnerships or other entities or arrangements treated as pass-through or disregarded entities for U.S. federal income tax
purposes (and investors therein);

• "controlled foreign corporations";

• "passive foreign investment companies";

• corporations that accumulate earnings to avoid U.S. federal income tax;

• banks, mutual funds, financial institutions, investment funds, insurance companies, brokers, dealers or traders in stock,
securities, commodities or currencies;

• tax-exempt organizations and governmental organizations;

• tax-qualified retirement plans;

• persons who acquire our common stock through the exercise of an option or otherwise as compensation;

• qualified foreign pension funds as defined in Section 897(l)(2) of the Code and entities all of the interests of which
are held by qualified foreign pension funds;

• persons that own, or have owned, actually or constructively, more than 5% of our common stock;

• persons who have elected to mark securities to market; and

• persons holding our common stock as part of a hedging or conversion transaction or straddle, or synthetic security or a
constructive sale, or other risk reduction strategy or integrated investment.

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If an entity or arrangement that is classified as a partnership for U.S. federal income tax purposes holds our common stock, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner, the activities of the partnership and certain determinations made at the partner level. Partnerships holding our common stock and the partners in such partnerships are urged to consult their tax advisors about the particular U.S. federal income tax consequences to them of owning and disposing of our common stock.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. PROSPECTIVE INVESTORS SHOULD CONSULT THEIR TAX ADVISORS REGARDING THE PARTICULAR U.S. FEDERAL INCOME TAX CONSEQUENCES TO THEM OF ACQUIRING, OWNING AND DISPOSING OF OUR COMMON STOCK, AS WELL AS ANY TAX CONSEQUENCES ARISING UNDER ANY STATE, LOCAL OR NON-U.S. TAX LAWS AND ANY OTHER U.S. FEDERAL TAX LAWS OR UNDER ANY APPLICABLE INCOME TAX TREATY.

**Definition of non-U.S. holder** 

For purposes of this discussion, a non-U.S. holder is any beneficial owner of our common stock that is for U.S. federal income tax purposes:

• a non-resident alien individual;

• a corporation or any organization taxable as a corporation for U.S. federal income taxes that is not created or organized
under the laws of the United States, any state thereof, or the District of Columbia; or

• a foreign trust or estate, the income of which is not subject to U.S. federal income tax on a net income basis.

**Distributions on our common stock** 

As described under "*Dividend Policy*," we do not currently anticipate declaring or paying, for the foreseeable future, any distributions on our capital stock. However, if we were to distribute cash or other property on our common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes will then constitute a return of capital and will first be applied against and reduce a holder's tax basis in our common stock, but not below zero. Any excess will be treated as gain realized on the sale or other disposition of our common stock and will be treated as described under "—*Gain on sale or other taxable disposition of our common stock*" below.

Subject to the discussions below regarding effectively connected income, backup withholding and FATCA (as defined below), dividends paid to a non-U.S. holder of our common stock generally will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends or such lower rate specified by an applicable income tax treaty. To receive the benefit of a reduced treaty rate, a non-U.S. holder must furnish to us or our withholding agent with a timely and valid IRS Form W-8BEN (in the case of individuals) or IRS Form W-8BEN-E (in the case of entities), or other appropriate form, certifying such holder's qualification for the reduced rate. This certification must be provided to us or our withholding agent before the payment of the dividends and must be updated periodically. If the non-U.S. holder holds our common stock through a financial institution or other agent acting on the non-U.S. holder's behalf, the non-U.S. holder will be required to provide appropriate documentation to the agent, which then will be required to provide certification to us or our withholding agent, either directly or through other intermediaries.

If a non-U.S. holder holds our common stock in connection with the conduct of a trade or business in the United States, and dividends paid on our common stock are effectively connected with such holder's U.S. trade or business (and, if required by an applicable tax treaty, are attributable to such holder's permanent

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establishment or fixed base in the United States), such non-U.S. holder generally will be exempt from U.S. federal withholding tax. To claim the exemption, the non-U.S. holder generally must furnish a valid IRS Form W-8ECI (or applicable successor form), certifying that the dividends are effectively connected with the non-U.S. Holder's conduct of a trade or business within the United States to the applicable withholding agent.

However, any such effectively connected dividends paid on our common stock generally will be subject to U.S. federal income tax on a net income basis at the regular U.S. federal income tax rates in the same manner as if such holder were a resident of the United States. A non-U.S. holder that is a corporation also may be subject to an additional branch profits tax equal to 30% (or such lower rate specified by an applicable income tax treaty) of its effectively connected dividends, as adjusted for certain items.

Non-U.S. holders that do not provide the required certification on a timely basis, but that qualify for a reduced treaty rate, may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim with the IRS. Non-U.S. holders should consult their tax advisors regarding any applicable income tax treaties that may provide for different rules.

**Gain on disposition of our common stock** 

Subject to the discussions below regarding backup withholding and FATCA (as defined below), a non-U.S. holder generally will not be subject to U.S. federal income tax on any gain realized on the sale or other taxable disposition of our common stock, unless:

• the gain is effectively connected with the non-U.S. holder's conduct of a
trade or business in the United States and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base maintained by the non-U.S. holder in the United States;

• the non-U.S. holder is a nonresident alien individual who is present in the United
States for a period or periods aggregating 183 days or more during the taxable year of the disposition, and certain other requirements are met; or

• our common stock constitutes a "United States real property interest" by reason of our status as a United
States real property holding corporation ("USRPHC") for U.S. federal income tax purposes at any time within the shorter of the five-year period preceding the disposition or the non-U.S. holder's holding period for our common stock, and our common stock is not "regularly traded" on an "established securities market" within the meaning of applicable Treasury Regulations, during the calendar year in which
the sale or other disposition occurs.

Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular U.S. federal income tax rates in the same manner as if such holder were a resident of the United States. A non-U.S. holder that is a corporation also may be subject to an additional branch profits tax equal to 30% (or such lower rate specified by an applicable income tax treaty) of its effectively connected earnings and profits for the taxable year, as adjusted for certain items.

Gain described in the second bullet point above will be subject to U.S. federal income tax at a flat 30% rate (or such lower rate specified by an applicable income tax treaty), but may be offset by certain U.S.- source capital losses of the non-U.S. holder (even though the individual is not considered a resident of the United States), provided that the non-U.S. holder has timely filed U.S. federal income tax returns with respect to such losses.

Determining whether we are a USRPHC depends on the fair market value of our United States real property interests relative to the fair market value of our worldwide real property interests and our other trade or business assets. We believe that we are not currently and we do not anticipate becoming a USRPHC for U.S. federal income tax purposes, although there can be no assurance we have not been, are not currently or will

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not in the future become a USRPHC. Even if we are treated as a USRPHC, gain realized by a non-U.S. holder on a disposition of our common stock will not be subject to U.S. federal income tax so long as (1) the non-U.S. holder owned, directly, indirectly and constructively, no more than 5% of our common stock at all times within the shorter of (a) the five-year period preceding the disposition or (b) the holder's holding period and (2) our common stock is "regularly traded" on an "established securities market," within the meaning of applicable U.S. Treasury Regulations. There can be no assurance that our common stock qualifies as regularly traded on an established securities market for purposes of the rules described above. Prospective investors are encouraged to consult their own tax advisors regarding the possible consequences to them if we have been, are or were to become a USRPHC.

Non-U.S. holders should consult their tax advisors regarding any applicable income tax treaties that may provide for different rules.

**Information reporting and backup withholding** 

Annual reports are required to be filed with the IRS and provided to each non-U.S. holder indicating the amount of distributions on our common stock paid to such holder and the amount of any tax withheld with respect to those distributions. These information reporting requirements apply even if no withholding was required because the distributions were effectively connected with the holder's conduct of a U.S. trade or business, or withholding was reduced or eliminated by an applicable income tax treaty. This information also may be made available under a specific treaty or agreement with the tax authorities in the country in which the non-U.S. holder resides or is established. Backup withholding, currently at a 24% rate, generally will not apply to payments to a non-U.S. holder of distributions on or the gross proceeds of a disposition of our common stock provided the non-U.S. holder furnishes the required certification for its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI, or otherwise establishes an exemption, and if the payor does not have actual knowledge, or reason to know, that the holder is a U.S. person who is not an exempt recipient.

Backup withholding is not an additional tax. If any amount is withheld under the backup withholding rules, the non-U.S. holder should consult with a U.S. tax advisor regarding the possibility of and procedure for obtaining a refund or a credit against the non-U.S. holder's U.S. federal income tax liability, if any.

**Withholding on foreign entities** 

Sections 1471 through 1474 of the Code, which are commonly referred to as FATCA, impose a U.S. federal withholding tax of 30% on certain payments made to a "foreign financial institution" (as specially defined under these rules) unless such institution enters into an agreement with the U.S. government to withhold on certain payments and to collect and provide to the U.S. tax authorities substantial information regarding certain U.S. account holders of such institution (which includes certain equity and debt holders of such institution, as well as certain account holders that are foreign entities with U.S. owners) or an exemption applies. FATCA also generally imposes a U.S. federal withholding tax of 30% on certain payments made to a "non-financial foreign entity" (as specially defined under these rules) unless such entity provides the withholding agent a certification that it does not have any "substantial United States owners" or provides information identifying certain direct and indirect U.S. owners of the entity or an exemption applies. An intergovernmental agreement between the United States and an applicable foreign country may modify these requirements. Under certain circumstances, a non-U.S. holder might be eligible for refunds or credits of such taxes. FATCA currently applies to dividends paid on our common stock and would have applied also to payments of gross proceeds from the sale or other disposition of our common stock. However, proposed regulations under FATCA provide for the elimination of the federal withholding tax of 30% applicable to gross

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proceeds of a sale or other disposition of from property of a type that can produce U.S.-source dividends or interest. Under these proposed Treasury Regulations (which may be relied upon by taxpayers prior to finalization), FATCA withholding does not apply to gross proceeds from sales or other dispositions of our common stock.

Prospective investors are encouraged to consult with their tax advisors regarding the possible implications of FATCA on their investment in our common stock.

EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS TAX ADVISOR REGARDING THE TAX CONSEQUENCES OF ACQUIRING, OWNING AND DISPOSING OF OUR COMMON STOCK, INCLUDING THE CONSEQUENCES OF ANY RECENT AND PROPOSED CHANGE IN APPLICABLE LAW, AS WELL AS TAX CONSEQUENCES ARISING UNDER ANY STATE, LOCAL, NON-U.S. OR U.S. FEDERAL NON-INCOME TAX LAWS.

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**Underwriting** 

We are offering the shares of common stock described in this prospectus through a number of underwriters. J.P. Morgan Securities LLC, Jefferies LLC, Leerink Partners LLC and TD Securities (USA) LLC are acting as joint book-running managers of the offering and as representatives of the underwriters. We have entered into an underwriting agreement with the underwriters. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriters, and each underwriter has severally agreed to purchase, at the public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following table:

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| | |
|:---|:---|
| **Name** | **Number of<br>shares** |
|  J.P. Morgan Securities LLC |  |
|  Jefferies LLC |  |
|  Leerink Partners LLC |  |
|  TD Securities (USA) LLC |  |
|  Total |  |

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The underwriters are committed to purchase all the common shares offered by us if they purchase any shares. The underwriting agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may also be increased or the offering may be terminated.

The underwriters propose to offer the common shares directly to the public at the initial public offering price set forth on the cover page of this prospectus and to certain dealers at that price less a concession not in excess of $ per share. Any such dealers may resell shares to certain other brokers or dealers at a discount of up to $ per share from the initial public offering price. After the initial offering of the shares to the public, if all of the common shares are not sold at the initial public offering price, the underwriters may change the offering price and the other selling terms. Sales of any shares made outside of the United States may be made by affiliates of the underwriters.

The underwriters have an option to buy up to additional shares of common stock from us to cover sales of shares by the underwriters which exceed the number of shares specified in the table above. The underwriters have 30 days from the date of this prospectus to exercise this option to purchase additional shares. If any shares are purchased with this option to purchase additional shares, the underwriters will purchase shares in approximately the same proportion as shown in the table above. If any additional shares of common stock are purchased, the underwriters will offer the additional shares on the same terms as those on which the shares are being offered.

The underwriting fee is equal to the public offering price per share of common stock less the amount paid by the underwriters to us per share of common stock. The underwriting fee is $ per share. The following table shows the per share and total underwriting discounts and commissions to be paid to the underwriters assuming both no exercise and full exercise of the underwriters' option to purchase additional shares.

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| | | |
|:---|:---|:---|
| | **Without<br>option to<br>purchase<br>additional<br>shares<br>exercise** | **With full<br>option to<br>purchase<br>additional<br>shares<br>exercise** |
|  Per Share | $| $|
|  Total | $| $|

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We estimate that the total expenses of this offering, including registration, filing and listing fees, printing fees and legal and accounting expenses, but excluding the underwriting discounts and commissions, will be approximately $. We have also agreed to reimburse the underwriters for certain of their expenses in an amount up to $.

A prospectus in electronic format may be made available on the web sites maintained by one or more underwriters, or selling group members, if any, participating in the offering. The underwriters may agree to allocate a number of shares to underwriters and selling group members for sale to their online brokerage account holders. Internet distributions will be allocated by the representatives to underwriters and selling group members that may make Internet distributions on the same basis as other allocations.

We have agreed that we will not (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, or submit to, or file with, the Securities and Exchange Commission a registration statement under the Securities Act relating to, any shares of our common stock or securities convertible into or exercisable or exchangeable for any shares of our common stock, or publicly disclose the intention to make any offer, sale, pledge, loan, disposition or filing, or (ii) enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any shares of common stock or any such other securities (regardless of whether any of these transactions are to be settled by the delivery of shares of common stock or such other securities, in cash or otherwise), in each case without the prior written consent of the representatives for a period of 180 days after the date of this prospectus, other than the shares of our common stock to be sold in this offering.

The restrictions on our actions, as described above, do not apply to certain transactions, including (i) the issuance of shares of common stock or securities convertible into or exercisable for shares of our common stock pursuant to the conversion or exchange of convertible or exchangeable securities or the exercise of warrants or options (including net exercise) or the settlement of RSUs (including net settlement), in each case outstanding on the date of the underwriting agreement and described in this prospectus; (ii) grants of stock options, stock awards, restricted stock, RSUs, or other equity awards and the issuance of shares of our common stock or securities convertible into or exercisable or exchangeable for shares of our common stock (whether upon the exercise of stock options or otherwise) to our employees, officers, directors, advisors, or consultants pursuant to the terms of an equity compensation plan in effect as of the closing of this offering and described in this prospectus, provided that such recipients enter into a lock-up agreement with the underwriters; (iii) the issuance of up to 5% of the outstanding shares of our common stock, or securities convertible into, exercisable for, or which are otherwise exchangeable for, our common stock, immediately following the closing of this offering, in acquisitions or other similar strategic transactions, provided that such recipients enter into a lock-up agreement with the underwriters; or (iv) our filing of any registration statement on Form S-8 relating to securities granted or to be granted pursuant to any plan in effect on the date of the underwriting agreement and described in this prospectus or any assumed benefit plan pursuant to an acquisition or similar strategic transaction.

Our directors and executive officers, and substantially all of our shareholders (such persons, the "lock-up parties") have entered into lock-up agreements with the underwriters prior to the commencement of this offering pursuant to which each lock-up party, with limited exceptions, for a period of 180 days after the date of this prospectus (such period, the "restricted period"), may not (and may not cause any of their direct or indirect affiliates to), without the prior written consent of the representatives, (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares of our common stock or any securities convertible into or exercisable or exchangeable for our common stock (including, without limitation, common stock or such other securities which may be deemed to be beneficially owned by such

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lock-up parties in accordance with the rules and regulations of the SEC and securities which may be issued upon exercise of a stock option or warrant (collectively with the common stock, the "lock-up securities")), (2) enter into any hedging, swap or other agreement or transaction that transfers, in whole or in part, any of the economic consequences of ownership of the lock-up securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of lock-up securities, in cash or otherwise, (3) make any demand for, or exercise any right with respect to, the registration of any lock-up securities, or (4) publicly disclose the intention to do any of the foregoing. Such persons or entities have further acknowledged that these undertakings preclude them from engaging in any hedging or other transactions or arrangements (including, without limitation, any short sale or the purchase or sale of, or entry into, any put or call option, or combination thereof, forward, swap or any other derivative transaction or instrument, however described or defined) designed or intended, or which could reasonably be expected to lead to or result in, a sale or disposition or transfer (by any person or entity, whether or not a signatory to such agreement) of any economic consequences of ownership, in whole or in part, directly or indirectly, of any lock-up securities, whether any such transaction or arrangement (or instrument provided for thereunder) would be settled by delivery of lock-up securities, in cash or otherwise.

The restrictions described in the immediately preceding paragraph and contained in the lock-up agreements between the underwriters and the lock-up parties do not apply, subject in certain cases to various conditions, to certain transactions, including (a) transfers or dispositions of lock-up securities: (i) as bona fide gifts, as a charitable contribution, or for bona fide estate planning purposes, (ii) by will or intestacy or any other testamentary document, (iii) to any member of the lock-up party's immediate family or to any trust for the direct or indirect benefit of the lock-up party or any immediate family member or if the lock-up party is a trust, to a trustor, trustee (or co-trustee) or beneficiary of the trust or to the estate of a trustor, trustee or beneficiary of such trust, (iv) to a corporation, partnership, limited liability company, investment fund or other entity (A) of which the lock-up party and its immediate family members are the legal and beneficial owner of all of the outstanding equity securities or similar interests or (B) controlled by, or under common control with, the lock-up party or the immediate family of the lock-up party, (v) to a nominee or custodian of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (iv), (vi) in the case of a corporation, partnership, limited liability company, trust or other business entity, (A) to another corporation, partnership, limited liability company, trust or other business entity that is an affiliate of the lock-up party, or to any investment fund or other entity controlling, controlled by, managing or managed by or under common control or common investment management with the lock-up party or its affiliates or (B) as part of a distribution to limited partners, members or stockholders of the lock-up party, (vii) by operation of law, (viii) to us upon death or disability of the lock-up party, or, if the lock-up party is an employee, upon death, disability or termination of employment of such employee, (ix) as part of a sale of lock-up securities (A) from the underwriters in the offering or (B) acquired in open market transactions after the completion of this offering, (x) to us in connection with the vesting, settlement or exercise of restricted stock units, options, warrants or other rights to purchase shares of our common stock (including "net" or "cashless" exercise), including for the payment of exercise price and tax and remittance payments, (xi) pursuant to a bona fide third-party tender offer, merger, consolidation or other similar transaction approved by our board of directors and made to all shareholders involving a change in control, provided that if such transaction is not completed, all such lock-up securities would remain subject to the restrictions in the immediately preceding paragraph or (xii) to us in connection with the transfer of shares of common stock pursuant to option agreements relating to the early exercise by the lock-up party of unvested options issued pursuant to our equity incentive plans, which plans are in each case described herein, under which we have the right to repurchase such shares and only to the extent we elect to exercise such right; (b) exercise of the options, settlement of RSUs or other equity awards, or the exercise of warrants granted pursuant to plans described in this prospectus, provided that any lock-up securities received upon such exercise, vesting or settlement would be subject to restrictions similar to those in

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the immediately preceding paragraph; (c) the conversion of outstanding preferred stock, warrants to acquire preferred stock, or convertible securities into shares of our common stock or warrants to acquire shares of our common stock, provided that any common stock or warrant received upon such conversion would be subject to restrictions similar to those in the immediately preceding paragraph; and (d) the establishment or modification by lock-up parties of trading plans under Rule 10b5-1 under the Exchange Act, provided that such plan does not provide for the transfer of lock-up securities during the restricted period.

The representatives, in their sole discretion, may release the securities subject to any of the lock-up agreements with the underwriters described above, in whole or in part at any time.

We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act.

We will apply to have our common stock approved for listing/quotation on under the symbol "KARD."

The underwriters have advised us that, pursuant to Regulation M of the Securities Act, they may also engage in other activities that stabilize, maintain or otherwise affect the price of the common stock, including the imposition of penalty bids. This means that if the representatives of the underwriters purchase common stock in the open market in stabilizing transactions or to cover short sales, the representatives can require the underwriters that sold those shares as part of this offering to repay the underwriting discount received by them.

These activities may have the effect of raising or maintaining the market price of the common stock or preventing or retarding a decline in the market price of the common stock, and, as a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. If the underwriters commence these activities, they may discontinue them at any time. The underwriters may carry out these transactions on the , in the over-the-counter market or otherwise.

Prior to this offering, there has been no public market for our common stock. The initial public offering price will be determined by negotiations between us and the representatives of the underwriters. In determining the initial public offering price, we and the representatives of the underwriters expect to consider a number of factors including:

• the information set forth in this prospectus and otherwise available to the representatives;

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• our prospects and the history and prospects for the industry in which we compete;

• an assessment of our management;

• our prospects for future earnings;

• the general condition of the securities markets at the time of this offering;

• the recent market prices of, and demand for, publicly traded common stock of generally comparable companies; and

• other factors deemed relevant by the underwriters and us.

Neither we nor the underwriters can assure investors that an active trading market will develop for our common shares, or that the shares will trade in the public market at or above the initial public offering price.

Certain of the underwriters and their affiliates have provided in the past to us and our affiliates and may provide from time to time in the future certain commercial banking, financial advisory, investment banking and other services for us and such affiliates in the ordinary course of their business, for which they have received and may continue to receive customary fees and commissions. In addition, from time to time, certain of the underwriters and their affiliates may effect transactions for their own account or the account of customers, and hold on behalf of themselves or their customers, long or short positions in our debt or equity securities or loans, and may do so in the future.

**Selling restrictions** 

Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

*Notice to prospective investors in the European Economic Area* 

In relation to each Member State of the European Economic Area (each, a "Relevant State"), no shares have been offered or will be offered pursuant to the offering to the public in that Relevant State prior to the publication of a prospectus in relation to the shares which has been approved by the competent authority in that Relevant State or, where appropriate, approved in another Relevant State and notified to the competent authority in that Relevant State, all in accordance with the Prospectus Regulation, except that the shares may be offered to the public in that Relevant State at any time:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to any qualified investor as defined under Article 2 of the Prospectus Regulation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to fewer than 150 natural or legal persons (other than qualified investors as defined under Article 2 of the Prospectus Regulation), subject to obtaining the prior consent of the underwriters for any such offer; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in any other circumstances falling within Article 1(4) of the Prospectus Regulation,

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provided that no such offer of the shares shall require the Company or any the underwriters to publish a prospectus pursuant to Article 3 of the Prospectus Regulation, supplement a prospectus pursuant to Article 23 of the Prospectus Regulation or publish an Annex IX document pursuant to Article 1(4) of the Prospectus Regulation.

For the purposes of this provision, the expression an "offer to the public" in relation to the shares in any Relevant State means the communication in any form and by any means of sufficient information on the terms of the offer and any shares to be offered so as to enable an investor to decide to purchase or subscribe for any shares, and the expression "Prospectus Regulation" means Regulation (EU) 2017/1129.

*Notice to prospective investors in the United Kingdom* 

No shares have been offered or will be offered pursuant to the offering to the public in the United Kingdom except that the shares may be offered to the public in the United Kingdom at any time:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) where the offer is conditional on the admission of the shares to trading on the London Stock Exchange plc's main market (in reliance on the exception in paragraph 6(a) of Schedule 1 of the POATR) or (ii) the
shares being offered are at the time of the offer already admitted to trading on London Stock Exchange plc's main market (in reliance on the exception in paragraph 6(b) of Schedule 1 of the POATR);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to any qualified investor as defined in paragraph 15 of Schedule 1 of the POATR;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to fewer than 150 persons (other than qualified investors as defined in paragraph 15 of Schedule 1 of the POATR), subject to obtaining the prior consent of underwriters for any such offer; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) in any other circumstances falling within Part 1 of Schedule 1 of the POATR.

For the purposes of this provision, the expression an "offer to the public" in relation to the shares in the United Kingdom means the communication to any person which presents sufficient information on: (a) the shares to be offered; and (b) the terms on which they are to be offered, to enable an investor to decide to buy or subscribe for the shares and the expressions "POATR" means the Public Offers and Admissions to Trading Regulations 2024.

*Notice to prospective investors in Canada* 

The shares may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the shares must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable securities laws.

Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser's province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser's province or territory for particulars of these rights or consult with a legal advisor.

Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts ("NI 33-105"), the underwriters are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.

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*Notice to prospective investors in Switzerland* 

This prospectus does not constitute an offer to the public or a solicitation to purchase or invest in any shares. No shares have been offered or will be offered to the public in Switzerland, except that offers of shares may be made to the public in Switzerland at any time under the following exemptions under the Swiss Financial Services Act ("FinSA"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. to any person which is a professional client as defined under the FinSA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. to fewer than 500 persons (other than professional clients as defined under the FinSA), subject to obtaining the prior consent of the representatives of the underwriters for any such offer; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. in any other circumstances falling within Article 36 FinSA in connection with Article 44 of the Swiss Financial Services Ordinance, provided that no such offer of shares shall require the Company or any investment bank
to publish a prospectus pursuant to Article 35 FinSA.

The shares have not been and will not be listed or admitted to trading on a trading venue in Switzerland.

Neither this document nor any other offering or marketing material relating to the shares constitutes a prospectus as such term is understood pursuant to the FinSA and neither this document nor any other offering or marketing material relating to the shares may be publicly distributed or otherwise made publicly available in Switzerland.

*Notice to prospective investors in the Dubai International Financial Centre* 

This document relates to an Exempt Offer in accordance with the Markets Law, DIFC Law No. 1 of 2012, as amended. This document is intended for distribution only to persons of a type specified in the Markets Law, DIFC Law No. 1 of 2012, as amended. It must not be delivered to, or relied on by, any other person. The Dubai Financial Services Authority ("DFSA") has no responsibility for reviewing or verifying any documents in connection with Exempt Offers. The DFSA has not approved this prospectus supplement nor taken steps to verify the information set forth herein and has no responsibility for this document. The securities to which this document relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the securities offered should conduct their own due diligence on the securities. If you do not understand the contents of this document you should consult an authorized financial advisor.

In relation to its use in the DIFC, this document is strictly private and confidential and is being distributed to a limited number of investors and must not be provided to any person other than the original recipient, and may not be reproduced or used for any other purpose. The interests in the securities may not be offered or sold directly or indirectly to the public in the DIFC.

*Notice to prospective investors in the United Arab Emirates* 

The shares have not been, and are not being, publicly offered, sold, promoted or advertised in the United Arab Emirates (including the Dubai International Financial Centre) other than in compliance with the laws of the United Arab Emirates (and the Dubai International Financial Centre) governing the issue, offering and sale of securities. Further, this prospectus does not constitute a public offer of securities in the United Arab Emirates (including the Dubai International Financial Centre) and is not intended to be a public offer. This prospectus has not been approved by or filed with the Central Bank of the United Arab Emirates, the Securities and Commodities Authority, Financial Services Regulatory Authority ("FSRA") or the DFSA.

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*Notice to prospective investors in Australia* 

This prospectus:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. does not constitute a disclosure document or a prospectus under Chapter 6D.2 of the Corporations Act 2001 (Cth) (the "Corporations Act");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. has not been, and will not be, lodged with the Australian Securities and Investments Commission ("ASIC"), as a disclosure document for the purposes of the Corporations Act and does not purport to include the
information required of a disclosure document for the purposes of the Corporations Act; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. may only be provided in Australia to select investors who are able to demonstrate that they fall within one or more of the categories of investors, available under section 708 of the Corporations Act ("Exempt
Investors").

The shares may not be directly or indirectly offered for subscription or purchased or sold, and no invitations to subscribe for or buy the shares may be issued, and no draft or definitive offering memorandum, advertisement or other offering material relating to any shares may be distributed in Australia, except where disclosure to investors is not required under Chapter 6D of the Corporations Act or is otherwise in compliance with all applicable Australian laws and regulations. By submitting an application for the shares, you represent and warrant to us that you are an Exempt Investor.

As any offer of shares of our common stock under this prospectus will be made without disclosure in Australia under Chapter 6D.2 of the Corporations Act, the offer of those securities for resale in Australia within 12 months may, under section 707 of the Corporations Act, require disclosure to investors under Chapter 6D.2 if none of the exemptions in section 708 applies to that resale. By applying for the shares of our common stock you undertake to us that you will not, for a period of 12 months from the date of issue of the shares, offer, transfer, assign or otherwise alienate those shares of our common stock to investors in Australia except in circumstances where disclosure to investors is not required under Chapter 6D.2 of the Corporations Act or where a compliant disclosure document is prepared and lodged with ASIC.

*Notice to prospective investors in Japan* 

The shares have not been and will not be registered pursuant to Article 4, Paragraph 1 of the Financial Instruments and Exchange Act. Accordingly, none of the shares nor any interest therein may be offered or sold, directly or indirectly, in Japan or to, or for the benefit of, any "resident" of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to or for the benefit of a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act and any other applicable laws, regulations and ministerial guidelines of Japan in effect at the relevant time.

*Notice to prospective investors in Hong Kong* 

The shares have not been offered or sold and will not be offered or sold in Hong Kong, by means of any document, other than (a) to "professional investors" as defined in the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (the "SFO") of Hong Kong and any rules made thereunder; or (b) in other circumstances which do not result in the document being a "prospectus" as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong Kong (the "CO") or which do not constitute an offer to the public within the meaning of the CO. No advertisement, invitation or document relating to the shares has been or may be issued or has been or may be in the possession of any person for the purposes of

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issue, whether in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public of Hong Kong (except if permitted to do so under the securities laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to "professional investors" as defined in the SFO and any rules made thereunder.

*Notice to prospective investors in Singapore* 

Each underwriter has acknowledged that this prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, each underwriter has represented and agreed that it has not offered or sold any shares or caused the shares to be made the subject of an invitation for subscription or purchase and will not offer or sell any shares or cause the shares to be made the subject of an invitation for subscription or purchase, and has not circulated or distributed, nor will it circulate or distribute, this prospectus or any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares, whether directly or indirectly, to any person in Singapore other than:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. to an institutional investor (as defined in Section 4A of the Securities and Futures Act (Chapter 289) of Singapore, as modified or amended from time to time (the "SFA")) pursuant to Section 274 of
the SFA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of the SFA, or any person pursuant to Section 275(1A) of the SFA, and in accordance with the conditions specified
in Section 275 of the SFA; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. Where the shares are subscribed or purchased under Section 275 of the SFA by a relevant person which is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals,
each of whom is an accredited investor; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary of the trust is an individual who is an accredited investor,

securities or securities-based derivatives contracts (each term as defined in Section 2(1) of the SFA) of that corporation or the beneficiaries' rights and interest (howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has acquired the shares pursuant to an offer made under Section 275 of the SFA except:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. to an institutional investor or to a relevant person, or to any person arising from an offer referred to in Section 275(1A) or Section 276(4)(c)(ii) of the SFA;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. where no consideration is or will be given for the transfer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. where the transfer is by operation of law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. as specified in Section 276(7) of the SFA; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. as specified in Regulation 37A of the Securities and Futures (Offers of Investments) (Securities and Securities-based Derivatives Contracts) Regulations 2018.

*Singapore SFA Product Classification*—In connection with Section 309B of the SFA and the CMP Regulations 2018, unless otherwise specified before an offer of shares of our common stock, we have determined, and

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hereby notify all relevant persons (as defined in Section 309A(1) of the SFA), that the shares of common stock are "prescribed capital markets products" (as defined in the CMP Regulations 2018) and Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).

*Notice to prospective investors in Bermuda* 

Shares may be offered or sold in Bermuda only in compliance with the provisions of the Investment Business Act of 2003 of Bermuda which regulates the sale of securities in Bermuda. Additionally, non-Bermudian persons (including companies) may not carry on or engage in any trade or business in Bermuda unless such persons are permitted to do so under applicable Bermuda legislation.

*Notice to prospective investors in Saudi Arabia* 

This document may not be distributed in the Kingdom of Saudi Arabia except to such persons as are permitted under the Rules on the Offer of Securities and Continuing Obligations Regulations as issued by the board of the Saudi Arabian Capital Market Authority ("CMA") pursuant to resolution number 3-123-2017 dated 27 December 2017, as amended (the "CMA Regulations"). The CMA does not make any representation as to the accuracy or completeness of this document and expressly disclaims any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this document. Prospective purchasers of the securities offered hereby should conduct their own due diligence on the accuracy of the information relating to the securities. If you do not understand the contents of this document, you should consult an authorised financial adviser.

*Notice to prospective investors in the British Virgin Islands* 

The shares are not being, and may not be offered to the public or to any person in the British Virgin Islands for purchase or subscription by or on behalf of us. The shares may be offered to companies incorporated under the BVI Business Companies Act, 2004 (British Virgin Islands), "BVI Companies"), but only where the offer will be made to, and received by, the relevant BVI Company entirely outside of the British Virgin Islands.

*Notice to prospective investors in China* 

This prospectus will not be circulated or distributed in the PRC and the shares will not be offered or sold, and will not be offered or sold to any person for re-offering or resale directly or indirectly to any residents of the PRC (for such purposes, not including the Hong Kong and Macau Special Administrative Regions or Taiwan), except pursuant to any applicable laws and regulations of the PRC. Neither this prospectus nor any advertisement or other offering material may be distributed or published in the PRC, except under circumstances that will result in compliance with applicable laws and regulations.

*Notice to prospective investors in Korea* 

The shares have not been and will not be registered under the Financial Investments Services and Capital Markets Act of Korea and the decrees and regulations thereunder (the "FSCMA"), and the shares have been and will be offered in Korea as a private placement under the FSCMA. None of the shares may be offered, sold or delivered directly or indirectly, or offered or sold to any person for re-offering or resale, directly or indirectly, in Korea or to any resident of Korea except pursuant to the applicable laws and regulations of Korea, including the FSCMA and the Foreign Exchange Transaction Law of Korea and the decrees and regulations thereunder (the "FETL"). Furthermore, the purchaser of the shares shall comply with all applicable regulatory requirements (including but not limited to requirements under the FETL) in connection with the purchase of the shares. By the purchase of the shares, the relevant holder thereof will be deemed to represent and warrant that if it is in Korea or is a resident of Korea, it purchased the shares pursuant to the applicable laws and regulations of Korea.

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*Notice to prospective investors in Malaysia* 

No prospectus or other offering material or document in connection with the offer and sale of the shares has been or will be registered with the Securities Commission of Malaysia ("Commission") for the Commission's approval pursuant to the Capital Markets and Services Act 2007. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Malaysia other than (i) a closed end fund approved by the Commission; (ii) a holder of a Capital Markets Services License; (iii) a person who acquires the shares, as principal, if the offer is on terms that the shares may only be acquired at a consideration of not less than RM250,000 (or its equivalent in foreign currencies) for each transaction; (iv) an individual whose total net personal assets or total net joint assets with his or her spouse exceeds RM3 million (or its equivalent in foreign currencies), excluding the value of the primary residence of the individual; (v) an individual who has a gross annual income exceeding RM300,000 (or its equivalent in foreign currencies) per annum in the preceding twelve months; (vi) an individual who, jointly with his or her spouse, has a gross annual income of RM400,000 (or its equivalent in foreign currencies), per annum in the preceding twelve months; (vii) a corporation with total net assets exceeding RM10 million (or its equivalent in a foreign currencies) based on the last audited accounts; (viii) a partnership with total net assets exceeding RM10 million (or its equivalent in foreign currencies); (ix) a bank licensee or insurance licensee as defined in the Labuan Financial Services and Securities Act 2010; (x) an Islamic bank licensee or takaful licensee as defined in the Labuan Financial Services and Securities Act 2010; and (xi) any other person as may be specified by the Commission; provided that, in the each of the preceding categories (i) to (xi), the distribution of the shares is made by a holder of a Capital Markets Services License who carries on the business of dealing in securities. The distribution in Malaysia of this prospectus is subject to Malaysian laws. This prospectus does not constitute and may not be used for the purpose of public offering or an issue, offer for subscription or purchase, invitation to subscribe for or purchase any securities requiring the registration of a prospectus with the Commission under the Capital Markets and Services Act 2007.

*Notice to prospective investors in Taiwan* 

The shares have not been and will not be registered with the Financial Supervisory Commission of Taiwan pursuant to relevant securities laws and regulations and may not be sold, issued or offered within Taiwan through a public offering or in circumstances which constitutes an offer within the meaning of the Securities and Exchange Act of Taiwan that requires a registration or approval of the Financial Supervisory Commission of Taiwan. No person or entity in Taiwan has been authorised to offer, sell, give advice regarding or otherwise intermediate the offering and sale of the shares in Taiwan.

*Notice to prospective investors in South Africa* 

Due to restrictions under the securities laws of South Africa, no "offer to the public" (as such term is defined in the South African Companies Act, No. 71 of 2008 (as amended or re-enacted) (the "South African Companies Act")) is being made in connection with the issue of the shares in South Africa. Accordingly, this document does not, nor is it intended to, constitute a "registered prospectus" (as that term is defined in the South African Companies Act) prepared and registered under the South African Companies Act and has not been approved by, and/or filed with, the South African Companies and Intellectual Property Commission or any other regulatory authority in South Africa. The shares are not offered, and the offer shall not be transferred, sold, renounced or delivered, in South Africa or to a person with an address in South Africa, unless one or other of the following exemptions stipulated in section 96 (1) applies:

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Section 96 (1) (a) the offer, transfer, sale, renunciation or delivery is to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. persons whose ordinary business, or part of whose ordinary business, is to deal in securities, as principal or agent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the South African Public Investment Corporation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. persons or entities regulated by the Reserve Bank of South Africa;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. authorised financial service providers under South African law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. financial institutions recognised as such under South African law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. a wholly-owned subsidiary of any person or entity contemplated in (c), (d) or (e), acting as agent in the capacity of an authorised portfolio manager for a pension fund, or as manager for a collective investment scheme
(in each case duly registered as such under South African law); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. any combination of the person in (i) to (vi); or

Section 96 (1) (b) the total contemplated acquisition cost of the securities, for any single addressee acting as principal is equal to or greater than ZAR1,000,000 or such higher amount as may be promulgated by notice in the Government Gazette of South Africa pursuant to section 96(2)(a) of the South African Companies Act.

Information made available in this prospectus should not be considered as "advice" as defined in the South African Financial Advisory and Intermediary Services Act, 2002.

*Notice to prospective investors in Israel* 

This prospectus does not constitute a prospectus under the Israeli Securities Law, 5728-1968, or the Israeli Securities Law, and has not been filed with or approved by the Israel Securities Authority. In Israel, this prospectus is being distributed only to, and is directed only at, and any offer of the shares is directed only at, (i) a limited number of persons in accordance with the Israeli Securities Law and (ii) investors listed in the first addendum, or the Addendum, to the Israeli Securities Law, consisting primarily of joint investment in trust funds, provident funds, insurance companies, banks, portfolio managers, investment advisors, members of the Tel Aviv Stock Exchange, underwriters, venture capital funds, entities with equity in excess of NIS 50 million and "qualified individuals," each as defined in the Addendum (as it may be amended from time to time), or, collectively referred to as qualified investors (in each case, purchasing for their own account or, where permitted under the Addendum, for the accounts of their clients who are investors listed in the Addendum). Qualified investors are required to submit written confirmation that they fall within the scope of the Addendum, are aware of the meaning of same and agree to it.

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**Legal matters** 

The validity of the shares of our common stock being offered in this prospectus will be passed upon for us by Goodwin Procter LLP. Certain partners of Goodwin Procter LLP have a beneficial interest in an aggregate of less than 1% of our common stock. Certain legal matters in connection with this offering will be passed upon for the underwriters by Latham & Watkins LLP.

**Experts** 

The financial statements as of December 31, 2025 and 2024 and for the years then ended included in this Prospectus have been so included in reliance on the report (which contains an explanatory paragraph relating to the Company's ability to continue as a going concern as described in Note 1 to the financial statements) of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.

**Where you can find additional information** 

We have filed with the SEC a registration statement on Form S-1 (File Number 333-) under the Securities Act with respect to the shares of common stock offered by this prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all the information set forth in the registration statement, some of which is contained in exhibits to the registration statement as permitted by the rules and regulations of the SEC. For further information with respect to us and our common stock, we refer you to the registration statement, including the exhibits filed as a part of the registration statement. Statements contained in this prospectus concerning the contents of any contract or any other document are not necessarily complete. If a contract or document has been filed as an exhibit to the registration statement, please see the copy of the contract or document that has been filed. Each statement in this prospectus relating to a contract or document filed as an exhibit is qualified in all respects by the filed exhibit. The SEC also maintains an internet website that contains reports and other information about issuers, like us, that file electronically with the SEC. The address of that website is *www.sec.gov/edgar.*

We currently do not file periodic reports with the SEC. On the completion of this offering, we will be subject to the information reporting requirements of the Exchange Act, and we will file reports, proxy statements and other information with the SEC. These reports, proxy statements and other information will be available for review at the website of the SEC referred to above.

We also maintain a website at *www.kardigan.bio*. Information contained in, or accessible through, our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is only as an inactive textual reference. Upon completion of this offering, you may access, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reported filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC.

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**Index to the consolidated financial statements** 

**Kardigan, Inc.** 

**Consolidated financial statements of Kardigan, Inc.** 

---

| | |
|:---|:---|
|  [Report of Independent Registered Public Accounting Firm](#fin107928_1) | F-2 |
|  [Consolidated Balance Sheets](#fin107928_2) | F-3 |
|  [Consolidated Statements of Operations and Comprehensive Loss](#fin107928_3) | F-4 |
|  [Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Deficit](#fin107928_4) | F-5 |
|  [Consolidated Statements of Cash Flows](#fin107928_5) | F-6 |
|  [Notes to Consolidated Financial Statements](#fin107928_6) | F-8 |

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**Report of Independent Registered Public Accounting Firm** 

To the Board of Directors and Stockholders of Kardigan, Inc.

***Opinion on the Financial Statements***

We have audited the accompanying consolidated balance sheets of Kardigan, Inc. (the "Company") as of December 31, 2025 and 2024, and the related consolidated statements of operations and comprehensive loss, of redeemable convertible preferred stock and stockholders' deficit and of cash flows for the years then ended, including the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

*Substantial Doubt about the Company's Ability to Continue as a Going Concern* 

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has incurred significant net losses and negative cash flows from operations since inception that raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

***Basis for Opinion***

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

San Jose, California

March 26, 2026

We have served as the Company's auditor since 2024.

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**Kardigan, Inc.** 

**Consolidated balance sheets** 

---

| | | |
|:---|:---|:---|
| | **Years ended December 31,** | **Years ended December 31,** |
| <br>**(in thousands, except share and per share data)** | **2025** | **2024** |
|  Assets |  |  |
|  Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $108989 | $49402 |
| &nbsp;&nbsp;&nbsp;&nbsp; Short-term investments | 226496 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | 9868 | 916 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current assets | 345353 | 50318 |
| &nbsp;&nbsp;&nbsp;&nbsp; Restricted cash | 540 | 413 |
| &nbsp;&nbsp;&nbsp;&nbsp; Property and equipment, net | 6493 | 2006 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease right-of-use assets, net | 11741 | 9127 |
| &nbsp;&nbsp;&nbsp;&nbsp; Preferred stock tranche asset |  | 1662 |
| &nbsp;&nbsp;&nbsp;&nbsp; Intangible assets, net | 23225 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other non-current assets | 3590 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets | $390942 | $63526 |
|  Liabilities, redeemable convertible preferred stock and stockholders' deficit |  |  |
|  Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | $7990 | $3861 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses and other current liabilities | 23903 | 3644 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease liabilities, current | 3143 | 780 |
| &nbsp;&nbsp;&nbsp;&nbsp; Contingent consideration liabilities, current | 2500 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current liabilities | 37536 | 8285 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease liabilities, net of current portion | 10689 | 8764 |
| &nbsp;&nbsp;&nbsp;&nbsp; Preferred stock tranche liability |  | 7284 |
| &nbsp;&nbsp;&nbsp;&nbsp; Contingent consideration liabilities, net of current portion | 5243 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other non-current liabilities | 1659 | 2365 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities | 55127 | 26698 |
|  Commitments and contingencies (Note 8) |  |  |
|  Redeemable convertible preferred stock |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Redeemable convertible preferred stock, par value of $0.00001 per share; 29,519,423 shares and 17,338,483 shares authorized as of December 31, 2025 and 2024, respectively; 29,519,423 shares and 6,959,334 shares issued and outstanding as of December 31, 2025 and 2024, respectively; aggregate liquidation preference of $597,168 and $135,170 as of December 31, 2025 and 2024, respectively | 586150 | 120022 |
|  Stockholders' deficit: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Common stock, par value of $0.00001 per share; 53,365,000 shares and 35,182,000 shares authorized as of December 31, 2025 and 2024, respectively; 10,265,637 shares and 10,110,000 shares issued and outstanding as of December 31, 2025 and 2024, respectively |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Additional paid-in capital | 30691 | 5954 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated other comprehensive income | 63 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accumulated deficit | (281089) | (89148) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total stockholders' deficit | (250335) | (83194) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities, redeemable convertible preferred stock and stockholders' deficit | $390942 | $63526 |

---

*The accompanying notes are an integral part of these consolidated financial statements.* 

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**Kardigan, Inc.** 

**Consolidated statements of operations and comprehensive loss** 

---

| | | |
|:---|:---|:---|
| | **Years ended December 31,** | **Years ended December 31,** |
| <br>**(in thousands, except share and per share data)** | **2025** | **2024** |
|  Operating expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development | $153086 | $84294 |
| &nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 48750 | 12362 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total operating expenses | 201836 | 96656 |
|  Loss from operations | (201836) | (96656) |
|  Other income (expense): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest income | 6850 | 1293 |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of preferred stock tranche obligations | 1100 | 6751 |
| &nbsp;&nbsp;&nbsp;&nbsp; Bargain purchase gain | 5232 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Warrant issuance expense | (7358) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Other expense, net | (441) | (46) |
|  Loss before income taxes | (196453) | (88658) |
| &nbsp;&nbsp;&nbsp;&nbsp; Income tax benefit | 4512 |  |
|  Net loss | $(191941) | $(88658) |
|  Net loss per share attributable to common stockholders, basic and diluted | $(23.63) | $(14.00) |
|  Weighted average common shares outstanding used in calculating net loss per share attributable to common stockholders, basic and diluted | 8122117 | 6332771 |
|  Other comprehensive loss |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Unrealized gain on investments | 63 |  |
|  Total comprehensive loss | $(191878) | $(88658) |

---

*The accompanying notes are an integral part of these consolidated financial statements.* 

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**Kardigan, Inc.** 

**Consolidated statements of redeemable convertible preferred stock and stockholders' deficit** 

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Redeemable convertible<br>preferred stock** | **Redeemable convertible<br>preferred stock** | **Common stock** | **Common stock** | **Additional<br>paid-in<br>capital** | **Accumulated<br>other<br>comprehensive<br>income** | **Accumulated<br>deficit** | **Total<br>stockholder's<br>deficit** |
| <br>**(in thousands, except share data)** | **Shares** | **Amount** | **Shares** | **Amount** | **Additional<br>paid-in<br>capital** | **Accumulated<br>other<br>comprehensive<br>income** | **Accumulated<br>deficit** | **Total<br>stockholder's<br>deficit** |
|  **Balance as of January 1, 2024** | **2** | $**—** | **9000000** | $**—** | $**—** | $**—** | $**(490)** | $**(490)** |
|  Conversion of Series FF-1 and FF-2 preferred stock into common stock | (2) |  |  |  |  |  |  |  |
|  Issuance of common stock |  |  | 10000 |  |  |  |  |  |
|  Issuance of common stock upon exercise of stock options |  |  | 1100000 |  |  |  |  |  |
|  Issuance of Series A preferred stock, net of issuance costs of $2.3 million, and tranche liability of $12.4 million | 5414758 | 90521 |  |  |  |  |  |  |
|  Issuance of Series A preferred stock as consideration for acquired in-process research and development | 1544576 | 29501 |  |  |  |  |  |  |
|  Stock-based compensation expense |  |  |  |  | 5954 |  |  | 5954 |
|  Net loss |  |  |  |  |  |  | (88658) | (88658) |
|  **Balance as of December 31, 2024** | **6959334** | $**120022** | **10110000** | $**—** | $**5954** | $**—** | $**(89148)** | $**(83194)** |
|  Issuance of Series A preferred stock upon settlement of tranche obligations | 10297174 | 204522 |  |  |  |  |  |  |
|  Issuance of Series B and Series B-1 preferred stock, net of issuance costs of $0.4 million | 11888555 | 253608 |  |  |  |  |  |  |
|  Issuance of Series B preferred stock for integration bonus | 374360 | 7998 |  |  |  |  |  |  |
|  Issuance of common stock warrants in connection with Series B preferred stock issuance |  |  |  |  | 7358 |  |  | 7358 |
|  Issuance of common stock as consideration for acquired in-process research and development |  |  |  |  | 259 |  |  | 259 |
|  Issuance of common stock upon exercise of stock options |  |  | 155637 |  | 366 |  |  | 366 |
|  Vesting of early-exercised stock options and restricted common stock |  |  |  |  | 901 |  |  | 901 |
|  Stock-based compensation expense |  |  |  |  | 15853 |  |  | 15853 |
|  Unrealized gain on investments, net of tax |  |  |  |  |  | 63 |  | 63 |
|  Net loss |  |  |  |  |  |  | (191941) | (191941) |
|  **Balance as of December 31, 2025** | **29519423** | $**586150** | **10265637** | $**—** | $**30691** | $**63** | $**(281089)** | $**(250335)** |

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*The accompanying notes are an integral part of these consolidated financial statements.* 

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**Kardigan, Inc.** 

**Consolidated statements of cash flows** 

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| | | |
|:---|:---|:---|
| | **Years ended December 31,** | **Years ended December 31,** |
| <br>**(in thousands)** | **2025** | **2024** |
|  **Cash flows from operating activities** |  |  |
|  Net loss | $(191941) | $(88658) |
|  Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation expense | 15853 | 5954 |
| &nbsp;&nbsp;&nbsp;&nbsp; Integration bonus expense | 14360 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Depreciation and amortization expense | 4196 | 11 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of premiums and accretion of discounts on short-term investments | (1174) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of preferred stock tranche obligations | (1100) | (6751) |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value of contingent consideration | (768) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Warrant issuance expense | 7358 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquired in-process research and development and milestones | 3259 | 65421 |
| &nbsp;&nbsp;&nbsp;&nbsp; Bargain purchase gain | (5232) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred income tax benefit | (4512) |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of right-of-use assets | 1547 | 346 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other non-cash charges | 671 |  |
|  **Changes in operating assets and liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | (7141) | (916) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other non-current assets | (3532) | 21 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | 1759 | 2058 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses and other current liabilities | 15238 | 3619 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Operating lease liabilities | 103 | 70 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash used in operating activities | (151056) | (18825) |
|  **Cash flows from investing activities** |  |  |
|  Proceeds from maturities of short-term investments | 17000 |  |
|  Purchases of short-term investments | (243436) |  |
|  Purchases of property and equipment | (5075) | (1804) |
|  Purchases of intangible assets | (65) |  |
|  Acquired in-process research and development and milestones | (1500) | (34615) |
|  Acquisition of Prolaio, net of cash acquired | (3961) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash used in investing activities | (237037) | (36419) |
|  **Cash flows from financing activities** |  |  |
|  Proceeds from issuance of preferred stock, net of issuance cost | 453608 | 102044 |
|  Tax withholding payments in relation to integration bonus | (6362) |  |
|  Proceeds from issuance of SAFE notes |  | 600 |
|  Proceeds from exercise of stock options | 561 | 2365 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash provided by financing activities | 447807 | 105009 |
|  Net increase in cash, cash equivalents and restricted cash | 59714 | 49765 |
|  Cash, cash equivalents and restricted cash at beginning of period | 49815 | 50 |
|  Cash, cash equivalents and restricted cash at end of period | $109529 | $49815 |
|  **Reconciliation of cash, cash equivalents and restricted cash:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | 108989 | 49402 |
| &nbsp;&nbsp;&nbsp;&nbsp; Restricted cash | 540 | 413 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total cash, cash equivalents and restricted cash | $109529 | $49815 |

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*The accompanying notes are an integral part of these consolidated financial statements* 

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**Kardigan, Inc.** 

**Consolidated statements of cash flows** 

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| | | |
|:---|:---|:---|
| | **Years ended December 31,** | **Years ended December 31,** |
| <br>**(in thousands)** | **2025** | **2024** |
|  **Supplemental disclosure of non-cash financing and investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Right-of-use asset obtained in exchange for lease obligation | $4185 | $9473 |
| &nbsp;&nbsp;&nbsp;&nbsp; Purchases of property and equipment included in accounts payable and accrued expenses | 352 | 214 |
| &nbsp;&nbsp;&nbsp;&nbsp; Issuance of common stock as consideration for acquired in-process research and development | 259 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Issuance of preferred stock as consideration for acquired in-process research and development |  | 29501 |
| &nbsp;&nbsp;&nbsp;&nbsp; Issuance of common stock warrants in connection with Series B preferred stock issuance | 7358 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Settlement of preferred stock tranche obligations | 4521 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Vesting of early-exercised stock options and restricted common stock | 366 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; SAFE notes converted into Series A preferred stock |  | 850 |

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*The accompanying notes are an integral part of these consolidated financial statements* 

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**1. Organization and principal activities** 

***Description of business***

Kardigan, Inc. ("the Company") is a clinical-stage precision therapeutics company developing medicines that target the root cause of specific cardiovascular diseases where no approved treatments exist. The Company's mission is to develop multiple targeted cardiovascular treatments in parallel that bring people with cardiovascular diseases closer to the cures they deserve. The Company was incorporated in Delaware in August 2023 under the name EnCarda, Inc., and changed its name to Kardigan, Inc. in December 2024. The Company is headquartered in South San Francisco, California.

Since inception, the Company has expanded its operations through a series of strategic acquisitions and licensing agreements. Refer to Note 5, *"Acquisitions and Licensing Agreements"*, for additional details.

***Liquidity and capital resources***

The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern. The Company has a limited operating history and has incurred significant net losses and negative cash flows from operations since inception. As of December 31, 2025, the Company had an accumulated deficit of $281.1 million. The Company expects to continue incurring substantial losses for the foreseeable future as it advances its research and development programs.

As of December 31, 2025, the Company's cash, cash equivalents and short-term investments totaled $335.5 million, and the Company recorded a net loss of $191.9 million for the year ended December 31, 2025. Based on the Company's current operating plan, management believes these resources will not be sufficient to fund operating activities for at least 12 months following the issuance date of the consolidated financial statements. Accordingly, substantial doubt exists regarding the Company's ability to continue as a going concern within one year after the date these consolidated financial statements were available to be issued.

To address its liquidity needs, the Company intends to seek additional capital through a combination of public or private equity offerings, debt financings, and other strategic sources, including potential collaborations, licensing agreements and other similar arrangements. While the Company has previously been able to raise financing, there can be no assurance that future financings will be available on terms which are favorable or at all. If the Company is unable to secure adequate additional funding, it may be required to implement cost reduction measures, extend payment terms with suppliers, liquidate assets where possible, and/or delay or reduce the scope of its planned development programs. Such actions could materially and adversely affect the Company's business, financial condition and future prospects.

**2. Summary of significant accounting policies** 

***Basis of presentation***

The Company's consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP"). Any reference in these notes to applicable guidance refers to the authoritative pronouncements contained in the Accounting Standards Codification ("ASC") and Accounting Standards Updates ("ASUs") of the Financial Accounting Standards Board ("FASB").

The consolidated financial statements include the accounts of Kardigan, Inc. and its wholly owned subsidiaries, Rancho Santa Fe Bio, Inc. ("RSF") and Prolaio, Inc. ("Prolaio"), which were acquired in June 2024 and February 2025, respectively. Refer to Note 5, "Acquisition and Licensing Agreements". All intercompany balances and transactions have been eliminated upon consolidation.

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***Use of estimates***

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The Company bases its estimates on historical experience and various other assumptions believed to be reasonable under the circumstances. Significant estimates and assumptions include, but are not limited to: the fair value of common stock and the fair value of common stock warrants, the fair value of preferred stock tranche obligations, purchase price allocations for acquisitions, the fair value of contingent consideration, the valuation of stock-based awards, the assessment of useful life and recoverability of long-lived assets, the estimated incremental borrowing rate used in operating lease calculations, the accrual of research and development costs, and the valuation allowance for deferred tax assets. Actual results could differ from those estimates and assumptions, and such differences could be material to the Company's financial position and results of operations.

***Operating segments***

The Company operates and manages its business as a single operating and reportable segment, focused on the discovery and development of novel therapeutic products to treat cardiovascular disease. The Company's Chief Executive Officer, who serves as the Chief Operating Decision Maker ("CODM"), reviews consolidated financial information based on net income, for purposes of making operating decisions, allocating resources and assessing financial performance.

***Risks and uncertainties***

Global economic and business activities continue to face widespread macroeconomic uncertainties, including health epidemics, labor shortages, bank failures, inflation and monetary supply shifts, tariffs, recession risks and potential disruptions from the geopolitical conflicts. The Company continues to actively monitor the impact of these macroeconomic factors on its financial condition, liquidity, operations, and workforce. The extent of the impact of these factors on the Company's operational and financial performance, including its ability to execute its business strategies and initiatives in the expected timeframe, will depend on future developments, which are uncertain and cannot be predicted; however, any continued or renewed disruption resulting from these factors could negatively impact the Company's business.

The Company's future results of operations involve a number of risks and uncertainties common to clinical stage companies in the biotechnology industry. The Company's product candidates are in development and the Company operates in an environment of rapid technological change and substantial competition from other pharmaceutical and biotechnology companies. Factors that could affect the Company's future operating results and cause actual results to vary materially from expectations include, but are not limited to, uncertainty of results of clinical trials and reaching milestones, uncertainty of regulatory approval of the Company's potential drug candidates, uncertainty of market acceptance of any of the Company's product candidates that receive regulatory approval, competition from new technological innovations, substitute products and market competition, securing and protecting proprietary technology, strategic relationships and dependence on key individuals and vendors.

Products developed by the Company require approvals from the U.S. Food and Drug Administration ("FDA") or other international regulatory agencies prior to commercial sales. There can be no assurance that any of the Company's product candidates will receive the necessary approvals. If the Company is denied approval, approval is delayed or the Company is unable to maintain approvals, it could have a materially adverse impact on the Company. Even if the Company's product development efforts are successful, it is uncertain when, if ever, the Company will generate significant revenue from product sales.

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The Company expects to incur substantial operating losses for the foreseeable future and will require additional financing to complete its clinical trials, and, if regulatory approval is obtained, to launch and commercialize its product candidates. There can be no assurance that such financing will be available when needed or will be on terms acceptable by the Company.

***Concentration of credit risk and of significant suppliers***

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents and investments. The Company maintains its cash, cash equivalents and investments, which at times exceed insurance limits, at major financial institutions. The Company is exposed to credit risk in the event of default by the financial institution holding its cash to the extent recorded in the consolidated balance sheets. The Company has not experienced any credit losses in such accounts and does not believe it is exposed to any unusual credit risk beyond the normal credit risk associated with commercial banking relationships. The Company's investment policy limits investments to high credit quality securities issued by the U.S. government, U.S. government-sponsored agencies, highly rated banks, and corporate issuers, subject to certain concentration limits and restrictions on maturities.

The Company is dependent on third-party contract manufacturing organizations ("CMOs") to supply drug substance and drug product for all of the Company's product candidates, for use in the preclinical studies, clinical trials and related testing. The Company currently relies, and expects to continue to rely, on a limited number of qualified manufacturers for these activities. The progress and completion of the ongoing and planned preclinical studies and clinical trials could be adversely affected by a significant interruption in the supply.

***Cash, cash equivalents and restricted cash***

The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Cash equivalents primarily consist of investments in money market accounts.

Restricted cash represents amounts that are legally restricted as to withdrawal or use under the terms of certain contractual agreements. The Company's restricted cash consists of cash deposited with a financial institution as collateral for a letter of credit required under the Company's lease agreements. Restricted cash is presented separately on the consolidated balance sheets.

***Investments***

The Company's investments consist of marketable debt securities. Marketable debt securities with contractual maturities of less than 12 months at the balance sheet date are considered short-term marketable securities. Marketable debt securities with contractual maturities of 12 months or greater at the balance sheet date are considered long-term marketable securities. The Company classifies all investments held as available-for-sale. Available-for-sale securities are recorded at fair value based upon market prices at period end, with the unrealized gains and losses reported in other comprehensive loss.

The amortized cost of debt securities classified as available-for-sale is adjusted for amortization of premiums and accretion of discounts to maturity. Such amortization is included in interest income in the consolidated statements of operations and comprehensive loss. Realized gains and losses and declines in value due to credit-related factors on available-for-sale securities are included in other expense, net in the consolidated statements of operations and comprehensive loss. The cost of securities sold is based on the specific identification method. Interest on securities classified as available-for-sale is included in interest income in the consolidated statements of operations and comprehensive loss.

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At each balance sheet date, the Company assesses available-for-sale debt securities in an unrealized loss position to determine whether the unrealized loss or any potential credit losses should be recognized in other expense, net. The Company evaluates whether it intends to sell, or whether it is more likely than not that it will be required to sell, the security before recovery of its amortized cost basis. The Company also evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, the Company considers the severity of the impairment, any changes in interest rates, changes to the underlying credit ratings and forecasted recovery, among other factors. The credit-related portion of unrealized losses, and any subsequent improvements, are recorded in other expense, net. No impairment charges or credit losses were recognized during any of the periods presented.

***Fair value measurement***

The Company accounts for recurring and non-recurring fair value measurements in accordance with ASC 820, which defines fair value, establishes a fair value hierarchy for assets and liabilities measured at fair value, and requires expanded disclosures about fair value measurements.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs.

The ASC 820 hierarchy ranks the quality of reliability of inputs, or assumptions, used in the determination of fair value and requires assets and liabilities carried at fair value to be classified and disclosed in one of the following three categories:

• Level 1—Quoted prices in active markets for identical assets or liabilities

• Level 2—Observable inputs (other than Level 1 quoted prices), including quoted prices for similar assets or
liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other observable market data.

• Level 3—Unobservable inputs that are significant to determining the fair value and supported by little or no market
activity, including pricing models, discounted cash flow methodologies, and similar techniques.

To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The carrying amounts of cash equivalents, prepaid expenses and other current assets, accounts payable, and accrued expenses approximate their fair values because of their short-term nature.

***Property and equipment, net***

Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is recorded using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the shorter of their estimated useful lives or the remaining lease term of the related asset. Expenditures that extend an asset's useful life or improve its functionality are capitalized, while routine repairs and maintenance are expensed as incurred.

Upon disposal or retirement of assets, the cost and related accumulated depreciation are removed from the consolidated balance sheets, and the resulting gain or loss is recognized in the consolidated statements of operations and comprehensive loss in the period realized. Property and equipment held for sale are carried at fair value less costs to sell.

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The estimated useful lives of the Company's property and equipment are as follows:

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| | |
|:---|:---|
| **Asset Classification** | **Estimated Useful Life** |
|  Laboratory equipment | 5 years |
|  Furniture and fixtures | 5 years |
|  Office equipment | 3 years |
|  Computer equipment | 3 years |
|  Leasehold improvements | Shorter of remaining lease term or estimated useful life |

---

***Business acquisitions, including goodwill, intangible assets and contingent consideration***

The Company evaluates mergers, acquisitions of assets, and other similar transactions to assess whether the transaction should be accounted for as a business combination or asset acquisition, by first applying a screen test to determine if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets. If the screen test is met, the transaction is accounted for as an asset acquisition. If the screen is not met, the Company further evaluates whether it has acquired inputs and processes that have the ability to create outputs which would meet the definition of a business.

The Company accounts for transactions that meet the definition of a business as business combinations using the acquisition method of accounting. Under this method, the identifiable assets acquired, including identifiable intangible assets, and liabilities assumed are recognized at their estimated fair values as of the acquisition date. Any excess of the consideration transferred over the estimated fair value of the net identifiable assets acquired is recorded as goodwill. Excess of the fair value of the net assets acquired over the purchase price is recorded as a bargain purchase gain.

Intangible assets acquired in a business combination related to in-process research and development ("IPR&D") are classified as indefinite-lived until the underlying research and development activities are completed or abandoned.

In circumstances where the Company is required to pay future consideration that is contingent upon the achievement of specified milestone events, the Company recognizes a liability equal to the estimated fair value of the contingent payments as of the acquisition date. The liability is remeasured at each reporting period, with fair value changes recorded in research and development ("R&D") expenses in the consolidated statements of operations and comprehensive loss.

Transaction costs associated with business combinations are expensed as they are incurred, and are recorded within general and administrative expenses in the consolidated statement of operations and comprehensive loss.

***Asset acquisitions and acquired in-process research and development***

The Company accounts for acquisitions of assets or a group of assets as asset acquisitions when substantially all of the fair value of the gross assets acquired are concentrated in a single asset or group of similar assets or when the definition of a business is not met. In an asset acquisition, the cost to acquire the asset or group of assets, including certain transaction costs, is allocated to the identifiable assets acquired and liabilities assumed based on their relative fair values as of the acquisition date. No goodwill is recognized in asset acquisitions.

Assets acquired for use in research and development activities that have an alternative future use are capitalized as IPR&D assets. Acquired IPR&D with no alternative future use is recognized as R&D expense on the acquisition date.

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The Company recognizes future payments such as those upon the achievement of certain regulatory, development, or sales milestones in an asset acquisition when the underlying milestones are probable to be achieved. Milestone payments made to third parties subsequent to regulatory approval may be capitalized as intangible assets, if deemed to have alternative future use, and amortized over the estimated remaining useful life of the related product. Royalties will be recognized as cost of sales when the covered products are sold and royalties are payable.

Upfront payments are presented as investing outflows within the consolidated statement of cash flows, when they are made in connection with the acquisition of an asset, regardless of whether the acquired asset is expensed as IPR&D or capitalized.

***Intangible assets***

Intangible assets consist of developed technology and IPR&D acquired in business combinations. Amortization is recognized using the straight-line method over the estimated useful lives of the related assets. Developed technology is amortized over a seven-year period. All other intangible assets subject to amortization are amortized over a three-year period. All intangible assets subject to amortization are reviewed for impairment in accordance with ASC 360.

***Impairment of long-lived assets***

The Company evaluates its long-lived assets, including property and equipment, finite-lived intangible assets and right-of-use assets, whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Factors that the Company considers in deciding when to perform an impairment review include significant underperformance of the business in relation to expectations, significant negative industry or economic trends and significant changes or planned changes in the use of the assets. If an impairment review is required, recoverability is measured by comparing the carrying value of the asset group to the estimated future undiscounted cash flows expected to be generated over its remaining economic life. If an asset group is considered to be impaired, the impairment recognized equals the amount by which the carrying value of the asset group exceeds its fair value. If the useful life is shorter than originally estimated, the Company amortizes the remaining carrying value over the revised shorter useful life.

***Leases***

The Company determines whether an arrangement is or contains a lease at inception. Operating lease right-of-use ("ROU") assets represent the Company's right to use underlying assets during the lease term, and corresponding lease liabilities represent the obligation to make lease payments. ROU assets and liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term, using the discount rate implicit in the lease, if readily determinable. When the implicit rate is not readily determinable, the Company uses its incremental borrowing rate, which reflects the rate it would pay to borrow on a collateralized basis over a similar term in a comparable economic environment.

ROU assets further include initial direct costs and prepaid lease payments, and are reduced by lease incentives received. Lease terms may include options to extend or terminate when it is reasonably certain such options will be exercised.

Lease expense is recognized on a straight-line basis over the lease term. Variable lease costs are recorded as an expense in the period incurred.

The Company elected not to separate lease and non-lease components for any leases within its existing classes of assets and as a result, accounts for lease and non-lease components as a single lease component.

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For short-term leases, defined as leases with a term of twelve months or less, for which there is no purchase option that the company is reasonably certain to exercise, the Company elected the practical expedient to not recognize an associated lease liability and ROU asset. Payments for short-term leases are expensed on a straight-line basis throughout the lease term and presented as operating expenses in the consolidated statements of operations and comprehensive loss.

***Classification and accretion of redeemable convertible preferred stock***

The Company's preferred stock does not have redemption rights, except for the contingent redemption in the event of a deemed liquidation, that, in certain situations, is not solely within the control of the Company and would call for the redemption of the then outstanding preferred stock. Therefore, the preferred stock is classified as mezzanine equity outside of stockholders' deficit on the consolidated balance sheets. The Company recorded the preferred stock at fair value upon issuance, net of tranche obligations and associated issuance costs. The preferred stock is not currently redeemable, and a deemed liquidation event is not currently probable. As such, the carrying values of the preferred stock are not being accreted to the redemption values. Subsequent adjustments to the carrying values of the preferred stock would be made only when a deemed liquidation event becomes probable.

***Preferred stock tranche obligations***

The purchase agreement for the Company's Series A preferred stock provided the Company with an obligation to issue and certain investors to purchase additional Series A preferred stock in subsequent closings upon satisfaction of certain conditions (the "preferred stock tranche obligations").

The Company determined the obligations met the definition of a freestanding instrument and recognized an associated asset or liability at fair value upon the initial issuance of the preferred stock. The preferred stock tranche obligations are subject to remeasurement at each balance sheet date, with changes in fair value recognized in the change in fair value of preferred stock tranche obligations in the consolidated statement of operations and comprehensive loss. Upon settlement of the preferred stock tranche obligations, the instrument is derecognized and the shares of preferred stock issued in connection with the settlement are recorded at fair value.

***Research and development expenses and related accruals***

R&D expenses are recognized in the period in which the related services are rendered or goods are received. R&D expenses primarily consist of personnel-related costs, including salaries, benefits, and stock-based compensation expense; laboratory supplies and facility costs; and fees paid to third parties conducting research, preclinical, and clinical activities on behalf of the Company. Non-refundable advance payments for future R&D activities are recorded in prepaid and other assets on the balance sheet, and expensed as the related goods are delivered or services are performed.

The Company estimates accrued R&D expenses based on its evaluation of services performed but not yet invoiced, using available information such as progress reports, contractual terms, and communication with vendors. These estimates include costs related to clinical research organizations ("CROs"), investigative sites, CMOs, and professional service providers. Because contractual payment schedules may not align with the timing of services rendered, expense recognition is based on the estimated level of effort or stage of completion.

Historically, the Company's estimates of accrued R&D expenses have not differed materially from actual amounts incurred; however, changes in estimates are recognized in the period in which additional information becomes available.

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***Stock-based compensation expense***

The Company measures compensation expense for all share-based awards based on the estimated fair value of the award on the grant date. For awards that vest solely based on continued service, stock-based compensation is recognized on a straight-line basis over the requisite service period. The Company recognizes expense related to stock options that contain performance conditions only when it is considered probable that the performance condition will be achieved. For performance and market awards, stock-based compensation expense is recognized over the requisite service period using the accelerated attribution method. The Company accounts for forfeitures as they occur.

The fair value of service-based stock options is determined on the grant date using the Black-Scholes option pricing model, which incorporates assumptions including the fair value of the Company's common stock, expected term, expected volatility, risk-free interest rate, and expected dividend yield.

Awards containing market-based conditions are valued using a Monte Carlo simulation model at the grant date, which uses assumptions similar to the Black-Scholes model and incorporates Level 3 inputs related to the likelihood of satisfying market conditions. Compensation expense for awards with market conditions is recognized using the accelerated attribution method over the requisite service period, regardless of whether the market condition is ultimately satisfied.

The Company records proceeds from the early exercise of options as a non-current liability in the consolidated balance sheets, and reclassifies this liability to additional paid-in capital as the Company's repurchase right lapses. The shares purchased by the option holders pursuant to the early exercise of stock options are not deemed, for accounting purposes, to be outstanding until those shares have vested.

***Income taxes***

The Company accounts for income taxes under an asset and liability approach for deferred income taxes, which requires recognition of deferred income tax assets and liabilities for the expected future tax consequences of events that have been recognized in the consolidated financial statements but have not been reflected in taxable income. Estimates and judgments occur in the calculation of certain tax liabilities and in the determination of the recoverability of certain deferred tax assets, which arise from temporary differences and carryforwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates that apply to taxable income in effect for the years in which those temporary differences are expected to be realized or settled. The Company regularly assesses the likelihood that deferred tax assets will be realized. To the extent that any amounts are believed to not be more-likely-than-not to be realized, a valuation allowance is recorded to reduce the deferred tax assets. The Company regularly assesses the need for a valuation allowance on deferred tax assets, and to the extent that an adjustment is needed, such adjustment will be recorded in the period that the determination is made. The Company recognizes tax benefits from uncertain tax positions only if it believes the position is more likely than not to be sustained upon examination by the taxing authorities based on the technical merits. The tax benefits recognized are measured as the largest amount of tax benefit that is more likely than not to be realized upon settlement. The Company recognizes interest and penalties related to income tax matters as income tax expense. To date, there have been no interest charges or penalties related to unrecognized tax benefits.

***Net loss per share***

Net loss per share attributable to common stockholders is calculated using the two-class method, as the Company's preferred stock represents participating securities that participate in earnings on a non-cumulative basis when dividends are declared on common stock.

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Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period, excluding shares subject to vesting or forfeiture, without consideration for potentially dilutive securities. Diluted net loss per share attributable to common stockholders is calculated by giving effect to all potentially dilutive securities outstanding for the period utilizing the treasury stock method or the if-converted method based on the nature of such securities. Diluted net loss per share is the same as basic net loss per share in periods when the effects of potentially dilutive shares of common stock are antidilutive.

In periods of net income, distributed and undistributed earnings are allocated to participating securities based on their contractual participation rights.

***Comprehensive loss***

Comprehensive loss includes all changes in equity (net assets) during a period from non-owner sources, including unrealized gains and losses on investments. Comprehensive gains and losses have been reflected in the consolidated statements of operations and comprehensive loss for the years ended December 31, 2025 and 2024.

***Emerging growth company***

The Company is an emerging growth company, as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (1) no longer an emerging growth company and (2) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act, unless early adoption is permitted. As a result, these consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.

***Recently adopted accounting pronouncements***

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which enhances segment reporting primarily through expanded disclosures of significant segment expenses. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-07 on a retrospective basis as of December 31, 2024. Required disclosures are presented in Note 14, *"Segment Reporting"*.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires the disclosure of specific categories in the rate reconciliation and greater disaggregation for income taxes paid. This standard is effective for annual periods beginning after December 15, 2024, and is to be adopted prospectively with the option to be adopted retrospectively. The Company retrospectively adopted this standard and presents the required income tax disclosures within the consolidated financial statements.

***New accounting pronouncements—Not yet adopted***

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40), which requires new tabular disclosures for specified categories of expenses. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026,

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and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its consolidated financial statements and disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which amends certain aspects of the accounting for, and disclosure of, internal-use software costs under ASC 350-40, Intangibles—Goodwill and Other—Internal-Use Software. ASU 2025-06 is intended to simplify and modernize the accounting for internal-use software costs by removing all references to prescriptive and sequential software development stages under Subtopic 350-40. The amendments in ASU 2025-06 are effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption permitted as of the beginning of an annual reporting period. The guidance can be applied prospectively, retrospectively or under a modified transition approach. The Company is currently assessing the impact of the adoption of this guidance on its consolidated financial statements and disclosures.

In September 2025, the FASB issued ASU 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606): Derivatives Scope Refinements and Scope Clarification for Share-Based Noncash Consideration from a Customer in a Revenue Contract, which clarifies the application of derivative accounting to certain contracts and refines the guidance for share-based noncash consideration received from customers. Specifically, ASU 2025-07 introduces a scope exception for contracts that are not exchange-traded and whose underlying is tied to operations or activities specific to one party. ASU 2025-07 is effective for fiscal years beginning after December 15, 2026 and interim periods within those fiscal years, with early adoption permitted. The guidance may be applied prospectively or under a modified retrospective transition approach, and the Company is currently assessing the impact of adoption on its consolidated financial statements and disclosures.

**3. Fair value measurements** 

The following tables summarize the types of financial assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy. As of December 31, 2025 and 2024, financial assets and liabilities measured at fair value on a recurring basis were as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** |
| | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash equivalents: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Money market funds | $99195 | $— | $— | $99195 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 5996 |  | 5996 |
| &nbsp;&nbsp;&nbsp;&nbsp; Short-term investments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; U.S. treasury bills |  | 94108 |  | 94108 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; U.S. government agency bonds |  | 43927 |  | 43927 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds |  | 88461 |  | 88461 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets measured at fair value | $99195 | $232492 | $— | $331687 |
|  Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Contingent consideration liabilities |  |  | 3817 | 3817 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities measured at fair value | $— | $— | $3817 | $3817 |

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** |
| | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Assets: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash equivalents: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Money market funds | $45640 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;— | $— | $45640 |
| &nbsp;&nbsp;&nbsp;&nbsp; Preferred stock tranche asset |  |  | 1662 | 1662 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets measured at fair value | $45640 | $— | $1662 | $47302 |
|  Liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Preferred stock tranche liability |  |  | 7284 | 7284 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities measured at fair value | $— | $— | $7284 | $7284 |

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There were no transfers between Level 1, 2, or 3 during the years ended December 31, 2025 and 2024.

The following table summarizes the Company's marketable securities, that are classified as available-for-sale, as of December 31, 2025 (in thousands):

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** | **As of December 31, 2025** |
| | **Amortized<br>cost** | **Unrealized<br>gains** | **Unrealized<br>losses** | **Aggregate**<br> **fair value** |
|  Short-term investments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; U.S. Treasury bills | $94045 | $63 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;— | $94108 |
| &nbsp;&nbsp;&nbsp;&nbsp; U.S. Government agency bonds | 43927 |  |  | 43927 |
| &nbsp;&nbsp;&nbsp;&nbsp; Corporate bonds | 88461 |  |  | 88461 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total short-term investments | $226433 | $63 | $— | $226496 |

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All marketable securities held as of December 31, 2025 had contractual maturities of less than one year.

As of December 31, 2025, no significant facts or circumstances were present to indicate a deterioration in the creditworthiness of the issuers of the marketable securities, and the Company has no requirement or intention to sell these securities before maturity or recovery of their amortized cost basis. The Company considered the current and expected future economic and market conditions and determined that its investments were not significantly impacted. For the year ended December 31, 2025, the Company did not recognize any impairment losses on its investments.

There were no marketable securities classified as available-for-sale as of December 31, 2024.

*Series A preferred stock tranche obligations* 

The preferred stock tranche asset and liability in the table above represent the fair value of the Company's obligations to issue Series A preferred stock in two subsequent closings upon satisfaction of certain conditions (Note 9, *"Redeemable Convertible Preferred Stock"*). These instruments are measured at fair value on a recurring basis and are classified within Level 3 of the fair value hierarchy as the valuation incorporates significant unobservable inputs.

The fair value was determined using a probability-weighted expected return method as it represents a contingent commitment for the additional shares. The valuation reflected market-participant assumptions, and considered, among other inputs, the estimated fair value per share of the Series A preferred stock as of each measurement date, probability of meeting certain milestone events, the expected time until certain milestone events would be met, and the discount rate.

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The most significant unobservable inputs were the estimated fair value of the Company's Series A preferred stock and the probability and expected timing of achieving certain milestone events as of the measurement dates. The Company determined the fair value per share of the underlying Series A preferred stock by taking into consideration the most recent sales of its Series A preferred stock, results obtained from third-party valuations and additional factors the Company deemed relevant. Changes in these inputs can materially affect the fair value of the preferred stock tranche obligations.

The following table presents the most significant assumptions used in the probability-weighted expected return model to determine the fair value of the Series A preferred stock tranche obligations during the years presented:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2024** | **December 31, 2024** | **June 6, 2024** | **June 6, 2024** |
| | **Second<br>tranche** | **Third<br>tranche** | **Second<br>tranche** | **Third<br>tranche** |
|  Probability of achieving milestone | 60% | 100% | 90% | 90% |
|  Risk free rate | 4.34% |  | 4.97% | 4.13% |
|  Term until milestone is achieved (years) | 0.8 | nil | 1.3 | 2.3 |

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Fair values of Series A preferred stock were $20.62 per share, $19.10 per share, $19.10 per share and $17.02 per share as of August 27, 2025 (the Second Tranche settlement date), February 25, 2025 (the Third Tranche settlement date), December 31, 2024 and June 6, 2024, respectively.

The following table presents a summary of the changes in the fair value of the Series A preferred stock tranche obligations, asset/(liability) (in thousands):

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| | | |
|:---|:---|:---|
| | **Second<br>tranche** | **Third<br>tranche** |
|  Balance at January 1, 2024 | $— | $— |
| &nbsp;&nbsp;&nbsp;&nbsp; Initial recognition | (3195) | (9178) |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value | (4089) | 10840 |
|  Balance at December 31, 2024 | $(7284) | $1662 |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value | 1100 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Settlement of preferred stock tranche obligations | 6184 | (1662) |
|  Balance at December 31, 2025 | $— | $— |

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As of December 31, 2024, the Company recognized fair value adjustments related to the tranche obligations issued in connection with the Series A financing. The Second Tranche obligation was recorded as a liability of $7.3 million because, assuming achievement of the related milestone conditions, the estimated future value of the Series A preferred stock upon the Second Tranche closing exceeded the contractual purchase price of $19.42 per share. In contrast, the Third Tranche obligation was recorded as an asset of $1.7 million, as the related milestone conditions were deemed effectively achieved with 100% probability and the estimated future value of Series A preferred stock upon the Third Tranche closing was below the contractual purchase price.

During the year ended December 31, 2025, upon the closing of the Second Tranche and the Third Tranche, the Company remeasured the tranche obligations at each respective date, and recognized the associated changes in fair value in change in fair value of preferred stock tranche obligations in the consolidated statement of operations and comprehensive loss. Upon settlement, the respective preferred stock tranche obligation was derecognized and the shares of preferred stock issued in connection with the settlement were recorded at fair value.

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*Prolaio Contingent Consideration* 

The following table presents a summary of the changes in the fair value of the Prolaio contingent consideration liability (in thousands):

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| | |
|:---|:---|
| | **Amount** |
|  Balance at December 31, 2024 | $— |
| &nbsp;&nbsp;&nbsp;&nbsp; Initial recognition upon acquisition | (4585) |
| &nbsp;&nbsp;&nbsp;&nbsp; Change in fair value | 768 |
|  Balance at December 31, 2025 | $(3817) |

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The Company utilizes significant estimates and assumptions it believes would be made by a market participant in determining the estimated fair value of contingent consideration liabilities at each balance sheet date. The fair value of the Prolaio contingent consideration was determined by calculating the probability-weighted estimated value of the specified milestone payments, based on the assessment of the likelihood and estimated timing that the milestones would be achieved and the applicable discount rates. The discount rate captures the credit risk associated with the payment of the contingent consideration when earned and due. The Company assesses these estimates on an ongoing basis as additional data impacting the assumptions is obtained.

The fair value of the Prolaio contingent consideration as of the acquisition date and as of December 31, 2025 were calculated using the following unobservable inputs:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2025** | **February 24, 2025** | **February 24, 2025** |
| | **Range** | **Weighted<br>average** | **Range** | **Weighted<br>average** |
|  Discount rates | 14.99% | 14.99% | 9.90%-10.19% | 10.14% |
|  Probability of milestone achievement | 0.3%-4.9% | 1.98% | 0.3%-4.9% | 1.98% |

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The weighted-average unobservable inputs were calculated based on the relative value of the specified milestones. The estimated fair value of contingent consideration liabilities may change significantly as development progresses and additional data is obtained, impacting the assumptions regarding probabilities of successful achievement of the milestones used to estimate the fair value of the liability and the timing in which they are expected to be achieved. In evaluating the fair value assumptions, judgment is required to interpret the market data used to develop the estimates. Accordingly, the use of different market assumptions, inputs and/or different valuation techniques could result in materially different fair value estimates.

*PhysIQ Contingent Consideration (Assumed Liability)* 

The Company utilized significant estimates and assumptions it believes would be made by a market participant in determining the estimated fair value of the contingent consideration liability. The fair value of the PhysIQ contingent consideration, as of the acquisition date, was determined by calculating the probability-weighted estimated value of the specified milestone payments, based on the assessment of the likelihood and estimated timing that the milestones would be achieved and the applicable discount rates. The discount rate captures the credit risk associated with the payment of the contingent consideration when earned and due.

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The fair value of the PhysIQ contingent consideration as of the acquisition date was $3.3 million and was calculated using the following unobservable inputs:

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| | | |
|:---|:---|:---|
|  | **February 24, 2025** | **February 24, 2025** |
| | **Range** | **Weighted<br>average** |
|  Discount rates | 9.90%-10.15% | 10.10% |
|  Probability of milestone achievement | 10.0%-80.0% | 20.63% |

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The weighted-average unobservable inputs were calculated based on the relative value of the specified milestones. The estimated fair value of contingent consideration liabilities may change significantly as development progresses and additional data is obtained, impacting the assumptions regarding probabilities of successful achievement of the milestones used to estimate the fair value of the liability and the timing in which they are expected to be achieved. In evaluating the fair value assumptions, judgment is required to interpret the market data used to develop the estimates. Accordingly, the use of different market assumptions, inputs and/or different valuation techniques could result in materially different fair value estimates. Following the initial recognition at the acquisition date, the acquired contingency is not subsequently measured at fair value. Refer to Note 5, "*Acquisitions and Licensing Agreements*" for further details on the change in the carrying value of the PhyslQ contingent consideration of $0.6 recorded in the year ended December 31, 2025.

*Simple agreements for future equity ("SAFEs")* 

From September 2023 through April 2024, the Company issued a series of SAFEs to several related parties, in the aggregate amount of $0.9 million (refer Note 15, *"Related Party Transactions"*). The SAFEs were determined to be within the scope of ASC 480, and were initially measured at fair value upon issuance.

The duration of the SAFEs ranged from three to nine months from the issuance through the final settlement. The SAFEs were settled upon the closing of the Series A redeemable convertible preferred stock financing through the issuance of Series A redeemable convertible preferred stock. Because the SAFEs were settled by issuing a variable number of shares based on a fixed monetary amount, the settlement value equaled the original issuance amount. Any imputed interest associated with the SAFEs' short duration was determined to be immaterial and was not separately recognized. Accordingly, the Company concluded that the original issuance amount of the SAFEs approximated their fair value through the date of conversion.

Upon the issuance of Series A redeemable convertible preferred stock in June 2024, the SAFEs automatically converted into 43,762 shares of Series A redeemable convertible preferred stock.

The following table presents a summary of the changes in the fair value of SAFEs (in thousands):

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| | |
|:---|:---|
| | **Amount** |
|  Balance at January 1, 2024 | $250 |
| &nbsp;&nbsp;&nbsp;&nbsp; Proceeds from issuance of SAFE notes | 600 |
| &nbsp;&nbsp;&nbsp;&nbsp; Conversion of SAFE notes into Series A redeemable convertible preferred stock | (850) |
|  Balance at December 31, 2024 | $— |

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**4. Balance sheet components** 

***Property and equipment, net***

Property and equipment, net, consisted of the following (in thousands):

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| | | |
|:---|:---|:---|
| | **December 31,<br>2025** | **December 31,<br>2024** |
| &nbsp;&nbsp;&nbsp;&nbsp; Laboratory equipment | $5251 | $1489 |
| &nbsp;&nbsp;&nbsp;&nbsp; Computer equipment | 798 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Furniture & fixtures | 507 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Leasehold improvements | 396 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Office equipment | 184 |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Construction in progress | 370 | 528 |
|  Property and equipment, gross | $7506 | $2017 |
| &nbsp;&nbsp;&nbsp;&nbsp; Less: accumulated depreciation | (1013) | (11) |
|  Property and equipment, net | $6493 | $2006 |

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Depreciation expense was $1.0 million and inconsequential for the years ended December 31, 2025 and 2024, respectively.

***Accrued liabilities***

Accrued liabilities consisted of the following (in thousands):

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| | | |
|:---|:---|:---|
| | **December 31,<br>2025** | **December 31,<br>2024** |
|  Accrued clinical trial expenses | $9154 | $1420 |
|  Accrued personnel and related expenses | 9128 | 1770 |
|  Accrued manufacturing expenses | 2355 | 191 |
|  Other | 3266 | 263 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total accrued expenses and other current liabilities | $23903 | $3644 |

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**5. Acquisitions and licensing agreements** 

***Acquisition of Prolaio***

On February 24, 2025 (the "Acquisition Date"), the Company acquired 100% of the outstanding shares of Prolaio, Inc., a healthcare technology company focused on cardiovascular data collection and analytics. The acquisition provides the Company with access to Prolaio's cardiovascular data platform, to enhance and accelerate the Company's research and development portfolio of late-stage cardiovascular disease assets. At the time of the acquisition, Tassos Gianakakos, our Chief Executive Officer, also served as Prolaio's Chief Executive Officer and Jay Edelberg, our Chief Medical Officer, served as its President, Research & Development. Mr. Gianakakos and Dr. Edelberg owned 55.7% and 16.6%, respectively, of Prolaio at the time of its acquisition. Accordingly, the Prolaio acquisition itself constituted a related party transaction. Refer to Note 15, "*Related Party Transactions*" for further details.

The Company concluded that Prolaio constitutes a business under ASC 805 and the transaction was accounted for as a business combination.

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The total purchase consideration transferred was approximately $8.6 million, consisting of approximately $4.0 million in cash and fair value of contingent consideration of $4.6 million, representing the estimated acquisition date fair value of milestone payments of up to $200.0 million, payable in cash or shares, contingent on the achievement of various post-closing milestones (the "Prolaio Contingent Consideration"). The Prolaio Contingent Consideration was recognized as contingent consideration liabilities on the consolidated balance sheet.

Acquisition related costs of approximately $0.8 million, consisting primarily of legal, accounting, and valuation fees, were expensed as incurred and recorded within general and administrative expenses in the consolidated statement of operations and comprehensive loss.

The following table summarizes the fair values of the identifiable assets acquired and liabilities assumed as of the Acquisition Date (in thousands):

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| | |
|:---|:---|
| | **Amount** |
|  Assets acquired: |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Cash and cash equivalents | $14 |
| &nbsp;&nbsp;&nbsp;&nbsp; Inventory | 244 |
| &nbsp;&nbsp;&nbsp;&nbsp; Prepaid expenses and other current assets | 390 |
| &nbsp;&nbsp;&nbsp;&nbsp; Property and software | 175 |
| &nbsp;&nbsp;&nbsp;&nbsp; Developed technology | 25400 |
| &nbsp;&nbsp;&nbsp;&nbsp; In-process research and development (IPR&D) | 1100 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease right-of-use assets, net | 255 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other non-current assets | 57 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total assets acquired | 27635 |
|  Liabilities assumed: |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Accounts payable | 2710 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued expenses and other current liabilities | 2717 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred revenue | 270 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease liability | 109 |
| &nbsp;&nbsp;&nbsp;&nbsp; Assumed contingent consideration liability | 3300 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred income tax liability | 4512 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other liabilities, non-current | 205 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total liabilities assumed | 13823 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net assets acquired | $13812 |

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In connection with this acquisition, the Company recorded $13.8 million of net assets acquired, primarily consisting of developed technology with a fair value of $25.4 million, IPR&D with a fair value of $1.1 million, and $13.8 million in liabilities assumed, including $4.5 million of deferred income tax liability and $3.3 million of assumed contingent consideration liability. Because the fair value of net identifiable assets acquired exceeded the fair value of the consideration transferred, the Company recognized a gain on bargain purchase in amount of $5.2 million in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2025. The bargain purchase gain primarily reflects the Company's ability to acquire Prolaio at a purchase price below the fair value of the acquired net assets due to a combination of factors, including Prolaio's limited operating scale, historical operating losses, liquidity constraints at the time of the transaction, and the structure of the consideration transferred. In particular, concurrent with the acquisition, the Company entered into integration bonus arrangements with the Company's Chief Executive Officer and Chief Medical

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Officer ("Integration Bonus"), both of whom were former Prolaio shareholders. These arrangements were contingent upon post-combination services and successful integration and, accordingly, were accounted for as compensation expense rather than consideration transferred.

Prolaio's results of operations were included in the consolidated statement of operations and comprehensive loss from the date of acquisition, February 24, 2025. For the year ended December 31, 2025, Prolaio did not generate material revenue and contributed a net loss of $29.8 million.

*Pro forma financial information (unaudited)* 

The following unaudited pro forma combined financial information has been prepared to give effect to the Prolaio acquisition as if it had been consummated on January 1, 2024, and was prepared using the historical results of Kardigan and Prolaio for each of the respective periods (in thousands):

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| | | |
|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** |
| | **2025** | **2024** |
|  Net loss | $190426 | $119419 |

---

The pro forma amounts have been adjusted for:

• transaction costs of $1.0 million were excluded from the year ended December 31, 2025 pro forma results, and
included in the year ended December 31, 2024 pro forma results, as if these costs were incurred during the 2024 period;

• gain on bargain purchase of $5.2 million was excluded from the year ended December 31, 2025 pro forma results,
and included in the year ended December 31, 2024 pro forma results, as if such gain was recognized during the 2024 period;

• income tax benefit of $4.5 million was excluded from the year ended December 31, 2025 pro forma results, and
included in the year ended December 31, 2024 pro forma results, as if such benefit was recognized during the 2024 period;

• incremental stock-based compensation expense related to the integration bonus of $14.4 million was excluded from the year
ended December 31, 2025 pro forma results, and included in the year ended December 31, 2024 pro forma results, as if this expense was incurred during the 2024 period;

• incremental stock-based compensation expense related to the accelerated vesting of Prolaio options upon acquisition of
$1.6 million was excluded from the year ended December 31, 2025 pro forma results, and included in the year ended December 31, 2024 pro forma results, as if this expense was incurred during the 2024 period;

• incremental intangible assets amortization expense resulting from the fair value adjustment recognized for developed
technology in amount of $0.6 million and $2.6 million was included in the year ended December 31, 2025 and 2024 pro forma results, respectively;

• immaterial inter-company transactions between the Company and Prolaio during the years ended December 31, 2025 and
2024 were eliminated.

The Company had no revenue for the years ended December 31, 2025 and 2024.

The unaudited data is presented for informational purposes only and is not intended to represent or be indicative of the results of operations that would have been reported had the acquisition occurred on that date, nor is it intended to be representative of future results of operations of the combined company.

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*Acquired developed technology* 

Developed technology acquired consists of the cardiovascular analytics data platform originally obtained by Prolaio in November 2023 through its purchase of certain assets from PhysIQ (defined below). Subsequent to the asset purchase and prior to the Company's acquisition of Prolaio, Prolaio's engineering team enhanced the acquired technology and expanded the platform capabilities through the addition of new features and functional improvements.

As of the Acquisition Date, the fair value of the developed technology was estimated using the cost method, which incorporates management's estimates of the costs that would be incurred to develop the technology from scratch, including assumptions regarding required personnel, annual compensation, and the expected development timeline. The Company estimated that it would require approximately 3.7 years for a team of approximately 50 employees, with an estimated average annual cost ranging from $0.1 million to $0.2 million per employee, to recreate the technology, resulting in a total valuation of $25.4 million.

*Prolaio Contingent Consideration* 

As additional consideration, the Company is required to make contingent cash payments up to $200.0 million upon the achievement of certain specified post-closing operational, financial and regulatory milestones ("Prolaio milestones") prior to February 2029. The milestone payments depend on the success of the Company's clinical trials, achievement of certain Prolaio revenue targets (excluding intercompany revenue), and adoption and performance of the Prolaio platform. The fair value of the Prolaio Contingent Consideration at the acquisition date was $4.6 million. It was estimated using a probability weighted discounted cash flow model, which incorporates management's estimates of the probability and timing of milestone achievement as of the acquisition date. The milestones are contractually required to be achieved within four years from the date of acquisition, discounted at a rate of approximately 10%. None of the Prolaio milestones had been achieved as of December 31, 2025.

The contingent consideration liability is classified as Level 3 within the fair value hierarchy, due to the use of significant unobservable inputs. The liability is remeasured at fair value at each reporting date, with changes in fair value recognized in R&D expenses in the consolidated statements of operations and comprehensive loss. As of December 31, 2025, the fair value of the Prolaio contingent consideration was estimated at $3.8 million, and the related change in fair value of $0.8 million was recorded within R&D expenses in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2025.

*PhysIQ Contingent Consideration (Assumed Liability)* 

Liabilities assumed as part of the Company's acquisition of Prolaio included a contingent consideration liability associated with Prolaio's historical acquisition of certain assets of PhysIQ, Inc. ("PhysIQ contingent consideration"), a health technology company specializing in cloud-based predictive analytics for personalized physiology. The obligation of up to $20.0 million, payable in cash, is contingent upon the achievement of certain sales milestones ("PhysIQ milestones"). As of the acquisition date, the Company recognized this contingent consideration at fair value using a probability-weighted approach, which incorporates management's estimates of the probability and timing of milestone achievement. The milestones are expected to be achieved within 4 years from the date of acquisition of Prolaio, and are discounted at a rate of approximately 10%. The estimated fair value of the PhysIQ contingent consideration at the acquisition date was $3.3 million, which was recorded within contingent consideration liabilities on the consolidated balance sheet.

Following the acquisition date, the Company applies a systematic and rational approach and recognizes additional amounts related to the PhysIQ contingent consideration when the underlying milestones are considered probable of achievement and reasonably estimable. Amounts are written off only when it is resolved

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that the Company will not be required to make payment or when the obligation legally expires. As such, the PhysIQ contingent consideration recorded will not be reduced below the amount recorded at the acquisition date until the obligation expires or the liability is paid.

As of December 31, 2025, the Company reassessed the probability of achievement of the PhysIQ milestones, and recorded a $0.6 million increase in contingent consideration liability as R&D expense within the consolidated statement of operations and comprehensive loss. As of December 31, 2025, the total PhysIQ contingent consideration liability was $3.9 million. The milestone with a value of $2.5 million was considered probable of achievement and is expected to be achieved within 12 months of the reporting date and was classified within current liabilities on the consolidated balance sheet. None of the remaining PhysIQ milestones had been achieved or were considered probable as of December 31, 2025.

*Prolaio Bonus Integration Agreements* 

Concurrent with the acquisition of Prolaio, the Company entered into agreements (the "Bonus Agreements") with the Company's Chief Executive Officer and Chief Medical Officer, that provided a right to a bonus in the amount of $9.0 million and $2.0 million, respectively, of shares of common stock issued in our initial public offering or convertible preferred stock, as applicable, as well as additional cash amounts intended to cover related federal, state, and local tax obligations. The Bonus Agreements also provided that, if the equity securities issued were not freely tradeable, the Company would loan each executive an amount sufficient to cover applicable tax obligations. The awards were contingent upon the closing and successful integration of Prolaio, as determined by the Company's board of directors.

The Bonus Agreements became payable upon completion of the Series B Initial Closing. On September 4, 2025, in connection with the Series B Initial Closing, the Company entered into bonus integration agreements (the "Bonus Integration Agreements") with each executive. The Bonus Integration Agreements modified the Bonus Agreements such that (i) each recipient agreed to forfeit Series B Preferred Stock to satisfy the tax withholding obligations, (ii) certain payments required to be made under the Bonus Agreements would be remitted to federal and state tax authorities via payroll for certain tax liabilities required to be satisfied by us through payroll and (iii) no loan will be issued to the recipient. Pursuant to the Bonus Integration Agreements, and net of tax withholding obligations, on September 4, 2025, the Company issued an aggregate of 374,360 shares of Series B preferred stock, with an estimated grant date fair value of approximately $8.0 million, and subsequently remitted approximately $6.4 million in cash to satisfy the related tax obligations.

As the integration bonus payment was contingent upon post-combination services, the arrangement was accounted for as compensation. Accordingly, for the year ended December 31, 2025, the Company recognized $11.7 million of stock-based compensation expense within general and administrative expenses and $2.6 million of stock-based compensation expense within R&D expenses in the consolidated statement of operations and comprehensive loss.

***Acquisition of RSF***

On June 6, 2024, the Company acquired 100% of the outstanding shares of Rancho Santa Fe Bio, Inc. ("RSF") in order to obtain certain of RSF's existing intellectual properties, including (i) a license agreement relating to Ataciguat with Sanofi ("Sanofi"); and (ii) a patent license and know-how agreement with the Mayo Foundation for Medical Education and Research ("Mayo"). Total consideration was $14.8 million, and included cash of $3.5 million, the settlement of RSF's outstanding indebtedness of $10.6 million on the acquisition date and the payment of certain transaction costs of $0.7 million incurred by RSF. In addition, the Company is required to make milestone payments of up to $26.5 million in development and regulatory milestones and up to $249.5 million in sales milestones ("RSF milestones"), as well as low single-digit royalties on worldwide net sales of any pharmaceutical product containing Ataciguat (i.e., HMR1766).

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Under ASC 805, the Company determined that the acquisition did not meet the definition of a business at the time of the acquisition as substantially all of the fair value of the gross assets acquired were concentrated in a single identifiable asset. The Company determined that RSF was a variable interest entity ("VIE") under ASC 810 because it lacked sufficient equity to finance its activities. Upon acquisition, the Company became the primary beneficiary of RSF, and therefore was required to consolidate RSF. Accordingly, the transaction was accounted for as the acquisition of a VIE that is not a business.

The net assets acquired consisted primarily of the IPR&D asset, cash and cash equivalents in amount of $0.2 million, and assumed accounts payable for an amount of $1.3 million. Accordingly, the consideration allocated to the IPR&D asset amounted to $15.9 million. The acquired licensed technology was determined to be an IPR&D asset that did not have alternative future use as of the acquisition date, and the full amount was recognized as R&D expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024.

During the year ended December 31, 2025, the Company achieved the first development milestone associated with Ataciguat upon dosing of the first patient in the Phase 3 clinical trial. This milestone triggered a payment obligation of $3.0 million. As a result, the Company recognized $3.0 million in R&D expenses for the year ended December 31, 2025 in its consolidated statement of operations and comprehensive loss. Of the total milestone amount, $1.5 million was settled in cash and the remaining $1.5 million was accrued for in the Company's consolidated balance sheet as of December 31, 2025 within accrued and other current liabilities. None of the other RSF milestones have been achieved nor were deemed probable and estimable as of December 31, 2025.

Under the Sanofi and the Mayo agreements, the Company is obligated to make certain additional milestone, royalty and sublicense-related payments under these agreements, summarized further below.

*License agreement with Sanofi* 

On June 2, 2021, RSF entered into a license agreement with Sanofi, as subsequently amended on March 18, 2022, January 9, 2023, and November 7, 2025 (collectively, the "Sanofi License"), under which RSF received a worldwide, exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Sanofi know-how to exploit Ataciguat (also known as HMR1766) and pharmaceutical products containing Ataciguat ("Ataciguat Products") for all human and mammalian therapeutic, prophylactic and diagnostic uses (the "Sanofi License Field").

If the Company succeeds in developing and commercializing Ataciguat Products, it will be obligated to pay Sanofi up to an aggregate of $14.8 million in potential commercial milestone payments ("Sanofi milestones"). The Company is also obligated to pay Sanofi tiered royalties ranging from low-single digit to mid-single digit percentages on worldwide annual net sales of Ataciguat Products by the Company or its affiliates and sublicensees.

As of December 31, 2025, none of the Sanofi milestones had been achieved nor were deemed probable and estimable.

*Patent license and know-how agreement with mayo foundation for medical education and research ("Mayo")* 

On December 6, 2019, RSF entered into a license agreement with Mayo, as amended on May 20, 2021, August 23, 2023, March 10, 2024, June 6, 2024 and December 22, 2025 (collectively, the "Mayo License"), under which RSF received (i) a worldwide exclusive license with the right to sublicense (through multiple tiers) under certain Mayo patent rights, (ii) a nonexclusive license with the right to sublicense (through multiple tiers) to use certain know-how and materials, and (iii) a nonexclusive worldwide license, with the right to sublicense (through multiple tiers), subject to approval from Mayo, to use certain Mayo data, in each case in (i) through

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(iii), to develop, make, have made, use, offer for sale, sell, and import certain licensed products, including Ataciguat, for the prevention, diagnosis, and/or treatment of any and all human diseases and conditions.

The Company is obligated to pay Mayo up to $0.3 million in development and regulatory milestone payments and up to $1.3 million in commercial milestone payments ("Mayo milestones") for each licensed product. The Company is also obligated to pay Mayo royalties ranging from a mid-single digit to subteen percentage of worldwide annual net sales by the Company, its affiliates and sublicensees of licensed products. In the event that the Company is required to pay a non-affiliate third party certain consideration for a license under intellectual property rights owned or controlled by such non-affiliate third party that are required for the manufacture, use or sale of the licensed products, the Company can deduct a certain amount of such consideration from the royalty payments due to Mayo under the Mayo License, subject to a customary reduction floor. The Company's obligation to pay Mayo royalties for licensed products will expire upon the expiration date of the last to expire of the licensed patents or the last to expire regulatory exclusivity for a licensed product. Mayo is also eligible to receive a mid-double digit percentage of certain non-royalty sublicense income as well as a certain percentage of any consideration received by the Company for the sale or transfer of an FDA priority review voucher or similar transferable asset.

As of December 31, 2025, none of the Mayo milestones had been achieved nor were deemed probable and estimable.

***License agreement with Ionis***

On June 7, 2024, the Company entered into a License Agreement (the "Ionis License Agreement") with Ionis Pharmaceuticals, Inc. ("Ionis"), pursuant to which the Company was granted an exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to develop and commercialize Tonlamarsen (formerly ION904) and products containing Tonlamarsen (the "Licensed Ionis Products") in the field of prophylactic or therapeutic use in humans (the "Ionis Licensed Field"). The Company also received a non-exclusive, worldwide, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain Ionis intellectual property to manufacture Tonlamarsen and Licensed Ionis Products in the Ionis Licensed Field. Until the third anniversary of the effective date of the Ionis License Agreement, or June 2027, neither party may develop or commercialize, or assist or grant a third party rights to develop or commercialize certain ASOs designed to bind to the RNA encoded by the human angiotensinogen gene, subject to certain conditions and exceptions.

As initial consideration for the Ionis License Agreement, the Company made an upfront payment of $20.0 million to Ionis. As additional consideration for the licenses and rights granted to us by Ionis, the Company is required to pay Ionis: (i) milestone payments in the event of successful achievement of specified development, regulatory and sales milestones of up to an aggregate of $375.0 million (up to $35.0 million in development and regulatory milestone payments and up to $340.0 million in sales milestone payments) ("Ionis milestones"); (ii) tiered royalties on net sales of Ionis Licensed Products by the Company, its affiliates and sublicensees with a rate based on net sales per calendar year, ranging from a subteen percentage to high teen percentage. The royalties are subject to potential reductions under certain scenarios. In the event that the Company undergoes a change of control prior to receiving regulatory approval and are acquired by one of certain top biopharmaceutical or pharmaceutical companies, the Company will be required to pay Ionis a one-time change of control payment based on the acquisition price, ranging in the low tens of millions of dollars. The payment will accrue interest at a subteen percentage rate per annum, compounded annually, from the date of the Ionis License Agreement through the date such payment is made.

The Company determined that the licenses represent an acquired IPR&D asset that did not have alternative future use as of the acquisition date, and, accordingly, the total amount of the upfront payment of $20.0 million

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was recognized as R&D expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024. As of December 31, 2025, none of the Ionis milestones had been achieved nor were deemed probable and estimable.

***License agreements with BMS Co.***

In November 2024, the Company entered into a License Agreement with MyoKardia, Inc. ("MyoKardia"), a wholly-owned subsidiary of Bristol-Myers Squibb Company ("BMS Co."), related to Danicamtiv and other compounds (the "Dani Agreement"), and a separate License Agreement with BMS Co. related to KAR-141 (formerly known as BMS-986141) ("Par4") and other compounds (the "Par4 Agreement").

Under the Dani Agreement, the Company received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain MyoKardia patents and know-how to develop, manufacture, and commercialize Danicamtiv (formerly known as MYK-491) and certain related compounds (collectively, the "Dani Licensed Compounds") and pharmaceutical products containing such Dani Licensed Compounds (the "Dani Licensed Products") for all human uses worldwide.

As partial consideration for the rights granted to the Company under the Dani Agreement, the Company entered into a Subscription Agreement with MyoKardia pursuant to which the Company issued 1,251,107 shares of Series A preferred stock to MyoKardia. As additional consideration for the licenses granted under the Dani Agreement, the Company is required to pay MyoKardia: (i) tiered royalties at a rate based on aggregate annual net sales by the Company, its affiliates and sublicensees of each Dani Licensed Product containing the same Dani Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by the Company, if the Company sublicenses to a third-party within a certain number of months from the effective date, or November 2026; (iii) up to $42.5 million in the aggregate in development and regulatory milestone payments across all Dani Licensed Products and (iv) up to $265.0 million in sales milestone payments for each of the first two Dani Licensed Products to achieve the applicable sales milestones ((iii) and (iv) collectively "Dani milestones"). The Company's tiered royalties range from a subteen to high teen percentage of annual net sales of the Dani Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to competition from generic products, for certain third-party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act of 2022 (the "Inflation Reduction Act"), subject to a customary reduction floor and potential carry-forward.

Under the Par4 Agreement, the Company received an exclusive, sublicensable (subject to certain conditions and restrictions), royalty-bearing license under certain BMS Co. patents and know-how to develop, manufacture, and commercialize KAR-141 (formerly known as BMS-986141) and certain related compounds (collectively, the "Par4 Licensed Compounds") and pharmaceutical products containing such Par4 Licensed Compounds ("Par4 Licensed Products") for all human uses worldwide.

As partial consideration for the rights granted under the Par4 Agreement, the Company issued 293,469 shares of Series A preferred stock. As additional consideration for the licenses granted under the Par4 Agreement, the Company is required to pay BMS Co.: (i) tiered royalties at a rate based on aggregate annual net sales by the Company, its affiliates and sublicensees of each Par4 Licensed Product containing the same Par4 Licensed Compound; (ii) a low double-digit percentage of any sublicensing revenue received by the Company, if the Company sublicenses to a third-party a certain number of months from the effective date, or November 2026; (iii) up to $10.0 million in the aggregate in development and regulatory milestone payments across all Par4 Licensed Products and (iv) up to $265.0 million in sales milestone payments for each of the first two Par4 Licensed Products to achieve the applicable sales milestones ((iii) and (iv) collectively "Par4 milestones"). The Company's tiered royalties range from a subteen to high teen percentage of annual net sales of the Par4 Licensed Products, subject to potential reductions following the expiration of valid patent claims, due to

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competition from generic products, for certain third-party license fees, and in the event of a limit on the maximum price as a result of the Inflation Reduction Act, subject to a customary reduction floor and potential carry-forward.

In connection with the license agreements, the Company issued an aggregate of 1,544,576 shares of Series A preferred stock to MyoKardia and BMS Co., including 1,251,107 shares of Series A preferred stock under the Dani Agreement, and 293,469 shares of Series A preferred stock under Par4 Agreement, at the estimated fair value of $19.10 per share as of issuance date, with a total estimated fair value of $29.5 million.

The Company determined that the Dani and Par4 licenses represent acquired IPR&D assets that did not have alternative future use as of the acquisition date, and, accordingly, an amount of $29.5 million was recognized as R&D expense in the consolidated statement of operations and comprehensive loss for the year ended December 31, 2024.

As of December 31, 2025, none of the Dani milestones or Par4 milestones had been achieved nor were deemed probable or estimable.

**6. Intangible assets** 

The following table summarizes the intangible assets, net (in thousands):

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| | | | |
|:---|:---|:---|:---|
|  | **December 31, 2025** | **December 31, 2025** | **December 31, 2025** |
| | **Gross carrying<br>amount** | **Accumulated<br>amortization** | **Net carrying<br>amount** |
|  Finite-lived intangible assets: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Developed technology | $25400 | $(3024) | $22376 |
| &nbsp;&nbsp;&nbsp;&nbsp; Other | 1165 | (316) | 849 |
|  Total finite-lived intangible assets | 26565 | (3340) | 23225 |
|  Total intangible assets | $26565 | $(3340) | $23225 |

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There were no intangible assets as of December 31, 2024. Intangible assets were first recognized during the year ended December 31, 2025, primarily related to developed technology and other acquired intellectual property. The acquired IPR&D assets recognized upon Prolaio acquisition, presented within other category, were initially classified as indefinite-lived. During 2025, the Company determined that the underlying projects had reached technological feasibility and no longer met the definition of indefinite-lived intangible assets, and therefore were reclassified as finite-lived intangible assets and assigned an estimated useful life of 3 years. Aggregate amortization expense related to finite-lived intangible assets was $3.3 million and zero, for the years ended December 31, 2025 and 2024, respectively, primarily included in R&D expenses on the consolidated statements of operations and comprehensive loss.

The following table summarizes the estimated future amortization expense associated with the finite-lived intangible assets as of December 31, 2025 (in thousands):

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| | |
|:---|:---|
| | **Amount** |
| 2026 | $4017 |
| 2027 | 4017 |
| 2028 | 3701 |
| 2029 | 3629 |
| 2030 | 3629 |
|  Thereafter | 4232 |
|  Total estimated future amortization expense | $23225 |

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As of December 31, 2025 and 2024, there were no accumulated impairment losses related to intangible assets.

**7. Leases** 

The Company leases office and laboratory spaces which are classified as operating leases on the consolidated balance sheets.

***Cove lease***

In September 2024, the Company entered into a facility lease in South San Francisco, California (the "Cove Lease"), for approximately 36,000 rentable square feet. The lease commenced in October 2024 and has a contractual term of 66 full calendar months, expiring in April 2030. The Cove Lease includes an option to extend the lease term for an additional five years. At lease commencement, the Company evaluated the renewal option and concluded that it is not reasonably certain that the renewal option will be exercised.

Under the terms of the Cove Lease, the landlord has made available a tenant improvement allowance of up to $0.7 million for qualifying permanent improvements to the leased premises. The allowance is structured as a landlord-funded improvement option that, if utilized, becomes subject to repayment by the Company as additional rent over the remaining lease term at a contractually specified interest rate. As of the reporting date, the Company has not elected to utilize any portion of the allowance, has not incurred any qualifying improvement expenditures, and has not received any landlord-initiated improvements requiring reimbursement. Accordingly, no related adjustments to ROU asset or lease liability have been recognized in the Company's consolidated financial statements.

***Princeton lease***

In February 2025, the Company entered into an office space lease for approximately 21,500 square feet in Princeton, New Jersey (the "Princeton Lease"). The lease commenced in September 2025 and has a contractual term of 90 full calendar months, expiring in March 2033. The Princeton Lease includes an option to extend the lease term for an additional five years. At lease commencement, the Company evaluated the renewal option and concluded that it is not reasonably certain that the renewal option will be exercised.

Concurrent with the execution of the Princeton lease, the Company executed a temporary swing-space lease, that provided approximately 9,000 square feet of office space in its 'as is' condition to support business operations while the main premises underwent landlord-performed improvements. The swing-space lease commenced in February 2025 and ended in September 2025 when the Company took possession of the main Princeton Lease premises. The arrangement met the definition of a lease under ASC 842 and qualified as a separate lease, however it met the short-term lease exemption criteria. Accordingly, the Company recognized lease expense for the swing-space as incurred, with no recognition of a ROU asset or lease liability for this arrangement.

The Company maintains letters of credit related to the Cove and Princeton Leases totaling $0.5 million and $0.4 million as of December 31, 2025 and 2024, respectively. These lease-related letters of credit are reflected within restricted cash, non-current on the Company's consolidated balance sheets as of December 31, 2025 and 2024.

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The lease expenses, which are included in operating expenses in the consolidated statements of operations and comprehensive loss, were as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** |
| | **2025** | **2024** |
|  Operating lease expense | $2660 | $576 |
|  Variable lease expense | 1305 | 216 |
|  Short-term lease expense | 138 | 60 |
|  Total lease expense | $4103 | $852 |

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Supplemental disclosure of cash flow information related to leases was as follows (in thousands):

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| | | |
|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** |
| | **2025** | **2024** |
|  Cash paid for amounts included in the measurement of lease liabilities | $1010 | $160 |
|  Right-of-use assets obtained in exchange for new operating lease liabilities | 4185 | 9473 |

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As of December 31, 2025 and 2024, the weighted-average remaining lease term for operating leases was 5.2 years and 5.3 years, respectively, and the weighted-average discount rate was 10.02% and 9.80%, respectively.

The following table reconciles the undiscounted future minimum lease payments required for the operating leases as of December 31, 2025 (in thousands):

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| | |
|:---|:---|
| | **Amount** |
| &nbsp;&nbsp;&nbsp;&nbsp; 2026 | $3293 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2027 | 3587 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2028 | 3666 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2029 | 3644 |
| &nbsp;&nbsp;&nbsp;&nbsp; 2030 | 1774 |
|  Thereafter | 1821 |
|  Total minimum lease payments | 17785 |
|  Less: imputed interest | (3953) |
|  Present value of operating lease liabilities | $13832 |

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**8. Commitments and contingencies** 

***Research and development agreements***

The Company enters into various agreements in the ordinary course of business, such as those with suppliers, clinical research organizations, contract manufacturing organizations, and clinical trial sites. These agreements provide for termination at the request of either party, generally with less than one-year notice and are, therefore, cancellable contracts and, if cancelled, are not anticipated to have a material effect on the Company's financial condition, results of operations, or cash flows.

***Legal proceedings***

From time to time, the Company may become involved in legal proceedings arising from the ordinary course of business. The Company accrues a liability for such matters when it is probable that the loss has been incurred and the amount of the loss can be reasonably estimated. Significant judgment is required to determine both probability and the estimated amount. As of December 31, 2025 and 2024, the Company had no material legal proceedings. Legal fees are expensed in the period in which they are incurred.

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***Indemnification***

In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties.

In accordance with the Company's amended and restated certificate of incorporation and amended and restated bylaws, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving in such capacity. The Company has not incurred any material indemnification claims to date. The Company maintains directors' and officers' liability insurance, which may reduce its exposure in the event of future claims.

***Future milestone and royalty payments***

In 2025 and 2024, the Company entered into certain acquisition and licensing agreements. These agreements include potential future milestone payments, royalties and other contingent consideration, payable upon the achievement of specified development, regulatory and commercial milestones. Refer to Note 5, *"Acquisition and Licensing Agreements"*.

**9. Redeemable convertible preferred stock** 

***Redeemable convertible preferred stock***

The Company has issued Series A redeemable convertible preferred stock ("Series A Preferred Stock"), Series B redeemable convertible preferred stock ("Series B Preferred Stock") and Series B-1 redeemable convertible preferred stock ("Series B-1 Preferred Stock"), which are collectively referred to as the Preferred Stock.

***Series A preferred stock***

In June 2024, the Company entered into a Series A preferred stock purchase agreement (the "Series A SPA") under which it issued and sold 2,487,790 shares of Series A preferred stock, at a price of $19.42 per share, for gross cash proceeds of $48.3 million (the "Series A Initial Closing"). Contemporaneously, investors converted their Simple Agreements for Future Equity ("SAFEs") with a principal amount of $0.9 million into 43,762 shares of Series A preferred stock, bringing the total number of shares of Series A preferred stock issued at the Series A Initial Closing to 2,531,552 shares. An initial additional closing under the Series A SPA occurred in July 2024, at which the Company sold 2,883,206 additional shares of Series A preferred stock at a price of $19.42 per share for gross cash proceeds of $56.0 million.

Pursuant to the Series A SPA, the Company had an obligation to issue and certain Series A investors were obligated to purchase additional shares in two additional closings of $100.0 million each, subject to the satisfaction of specified milestone and cash-related conditions. The Second Tranche closing was to be funded upon the Company's successful enrollment of the first patient in a Phase 3 clinical trial of either the Tonlamarsen Product or the Ataciguat Product, whichever occurs first (the "Second Tranche"). The Third Tranche closing was to be funded at the earlier of enrollment of the first patient in a Phase 3 clinical trial or an acquisition of any other clinical-stage pharmaceutical product or compound other than Tonlamarsen Product or Ataciguat Product or compound other than Ataciguat (the "Third Tranche"). Each investor could elect to voluntarily fund their share of the two tranches prior to the achievement of the milestones.

In November 2024, the Company determined, that the conditions related to the Third Tranche had become probable of achievement, subject to meeting the required cash-balance condition. In February 2025, following

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the satisfaction of the cash-balance condition, the Third Tranche closing was consummated, pursuant to which the Company sold 5,148,587 additional shares of Series A stock, resulting in total gross cash proceeds of $100.0 million. In August 2025, the condition applicable to the Second Tranche was waived, and the tranche closed, pursuant to which the Company sold 5,148,587 additional shares of Series A stock, resulting in additional gross cash proceeds of $100.0 million.

*Preferred stock tranche obligations* 

Upon the initial closing of the Series A preferred stock, with respect to the Second Tranche, the Company recorded a preferred stock tranche obligation liability of $3.2 million, and, with respect to the Third Tranche, the Company recorded a preferred stock tranche liability of $9.2 million. The fair value of the Series A preferred stock tranche obligations was allocated from the gross cash proceeds of the Series A preferred stock issuance, and the residual value was then allocated to the Series A preferred stock.

As of December 31, 2024, the fair value of the Second Tranche obligation was estimated as a liability in amount of $7.3 million, and the fair value of the Third Tranche was estimated as an asset in amount of $1.7 million. Accordingly, the Company recognized a loss in amount of $4.1 million and a gain in amount of $10.9 million in the consolidated statement of operations and comprehensive loss for year ended December 31, 2024, related to the change in the fair value of the Second Tranche obligation and Third Tranche obligation, respectively.

In 2025, upon closing of the Second and the Third Tranches, the Company remeasured the respective preferred stock tranche obligations as of the respective closing dates, resulting in a gain of $1.1 million recorded within the consolidated statement of operations and comprehensive loss. The estimated fair value of the preferred stock tranche liability related to the Second Tranche in amount of $6.2 million and the fair value of the preferred stock tranche asset related to the Third Tranche in amount of $1.7 million, were settled and the shares of Series A Preferred Stock issued in the Second Tranche and Third Tranche were recorded at fair value on the date of issuance. Refer to Note 3, *"Fair Value Measurements"*, for further details on valuation methodology and assumptions used.

*BMS Co. license* 

In November 2024, in connection with license agreements, the Company issued an aggregate of 1,544,576 shares of Series A preferred stock to MyoKardia and BMS Co., at the estimated fair value of $19.10 per share as of issuance date, with a total estimated fair value of $29.5 million. Refer to Note 5, "Acquisitions and Licensing Agreements", for more details.

***Series B preferred stock and Series B-1 preferred stock***

In September 2025, the Company entered into a Series B preferred stock purchase agreement (the "Series B SPA") under which it issued and sold 4,082,529 shares of Series B preferred stock and 2,610,635 shares of Series B-1 preferred stock, at a price of $21.37 per share for each series, for gross cash proceeds of $143.0 million (the "Series B Initial Closing"). In addition, the Company issued warrants to purchase 1,100,000 shares of the Company's common stock to certain investors. Refer to Note 10, *"Common Stock",* for more details.

Subsequent to the Series B Initial Closing, the first additional closing occurred on October 9, 2025, at which the Company sold 4,025,257 additional shares of Series B preferred stock at the same price of $21.37 per share for gross cash proceeds of $86.0 million. Additionally, the second additional closing was consummated on

October 15, 2025, at which the Company sold 1,170,134 additional shares of Series B-1 preferred stock at a price of $21.37 per share for gross cash proceeds of $25.0 million.

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***Summary***

Preferred stock as of December 31, 2025 and 2024 consisted of the following:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Series** | **Shares<br>authorized** | **Shares issued<br>and outstanding** | **Original<br>issue price<br>per share** | **Aggregate<br>liquidation<br>amount** | **Net carrying<br>value** |
|  Series A preferred stock | 17256508 | 17256508 | $19.42 | $335170 | $324544 |
|  Series B preferred stock | 8482146 | 8482146 | 21.37 | 181222 | 180954 |
|  Series B-1 preferred stock | 3780769 | 3780769 | 21.37 | 80776 | 80652 |
|  Total as of December 31, 2025 | 29519423 | 29519423 |  | $597168 | $586150 |
|  Series A preferred stock | 17338483 | 6959334 | 19.42 | 135170 | 120022 |
|  Total as of December 31, 2024 | 17338483 | 6959334 |  | $135170 | $120022 |

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The holders of preferred stock have the following rights and preferences:

*Voting* 

The holders of the preferred stock are entitled to vote, together with the holders of common stock, as a single class, on all matters submitted to the stockholders for a vote and are entitled to the number of votes equal to the number of shares of common stock into which the preferred stock could convert on the record date. The holders of Series B-1 preferred stock are not entitled to vote on the election of directors of the Company.

A majority vote of the holders of the preferred stock, voting together as a single class on an as-converted to common stock basis (the "Requisite Holders"), is required to, among others, effect a Deemed Liquidation Event (as defined below), amend the certificate of incorporation or bylaws, reclassify common stock or establish another class of capital stock, create shares that would rank senior to or authorize additional shares of Preferred Stock, issue indebtedness above specified thresholds, or change the authorized number of directors constituting the board of directors.

The holders of shares of the Series A preferred stock and the Series B preferred stock, voting together as a single class, are entitled to elect two directors of the Company. The holders of shares of common stock, voting exclusively and as a separate class, are entitled to elect two directors of the Company. The holders of shares of common stock and any other class or series of voting stock (other than the Series B-1 preferred stock), voting together as a single class, are entitled to elect the balance of the total number of directors of the Company.

*Conversion* 

Each share of preferred stock is convertible into common stock, at any time, at the option of the holder, and without the payment of additional consideration, at the 1-to-1 ratio, subject to certain adjustments in the event of a diluting issue such as down round, stock dividend, stock split, combination or other similar recapitalization. As of December 31, 2025, each share of preferred stock is convertible into one share of common stock.

In addition, each share of preferred stock will be automatically converted into shares of common stock at the then-effective applicable conversion ratio upon either (i) the closing of a firm-commitment underwritten public offering of the Company's common stock resulting in at least $125.0 million of gross proceeds, to the Company, or (ii) the date specified by vote or written consent of the Requisite Holders.

*Dividends* 

The Company will not declare, pay or set aside any dividends on common shares of the Company unless the holders of the preferred stock then outstanding will first receive, or simultaneously receive, a dividend on each

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outstanding share of the preferred stock in an amount at least equal to the product of (1) the dividend payable on each share of common stock and (2) the number of shares of common stock issuable upon conversion of a share of such series of Preferred Stock, in each case calculated on the record date for determination of the holders entitled to receive such dividend. No dividends have been declared or paid as of December 31, 2025.

*Liquidation* 

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, or upon the occurrence of a Deemed Liquidation Event (as defined below), the holders of shares of preferred stock then outstanding will be entitled, on a pari passu basis among all series of Preferred Stock, to be paid out of the assets or funds of the Company available for distribution to stockholders before any payment is made to the holders of common stock.

The holders of the preferred stock are entitled to an amount per share equal to the greater of (i) the applicable original issue price of the Preferred Stock, plus any dividends declared but unpaid thereon, or (ii) the amount that would have been payable had all shares of each series of preferred stock been converted into common stock immediately prior to such liquidation, dissolution, winding up or Deemed Liquidation Event. After the payment in full of the preferred stock preference amount, the remaining assets of the Company available for distribution to stockholders will be distributed among the holders of common stock on a pro rata basis.

Unless the Requisite Holders elect otherwise, a "Deemed Liquidation Event" will include a merger, consolidation, statutory conversion, transfer, domestication, or continuance (other than one in which stockholders of the Company own a majority by voting power of the outstanding shares of the surviving or acquiring corporation) or a sale, lease, transfer, exclusive license or other disposition of all or substantially all of the assets of the Company.

***Founders' Series FF preferred stock***

In August 2023, upon incorporation, the Company issued 1 share of Series FF-1 preferred stock at $0.00001 par value per share, and 1 share of Series FF-2 preferred stock at $0.00001 par value per share to Chief Executive Officer and Chief Medical Officer, respectively. In June 2024, in connection with the Company's Series A preferred stock financing, each share of Series FF-1 preferred stock and Series FF-2 preferred stock converted into zero shares of Class F-1 common stock and Class F-2 common stock.

**10. Common stock** 

***Common stock***

As of December 31, 2025, the Company's certificate of incorporation, as amended and restated, authorized the Company to issue 53,365,000 shares of common stock, $0.00001 par value. The voting, dividend and liquidation rights of the holders of the Company's common stock are subject to and qualified by the rights, powers and preferences of the holders of the Company's preferred stock set forth above. Each share of common stock is entitled to one vote on all matters submitted to stockholders, except that, pursuant to the Company's certificate of incorporation, holders of common stock are not entitled to vote on amendments to the certificate that relate solely to the terms of the outstanding preferred stock if the holders of such preferred stock are entitled to vote separately on those amendments.

The holders of common stock are entitled to receive dividends, if any, as declared by the Company's board of directors, subject to the preferential dividend rights of the preferred stock. As of December 31, 2025, and 2024 no dividends have been declared or paid.

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As of December 31, 2025, the Company had reserved common stock for future issuance as follows (shares):

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| | |
|:---|:---|
| | **December 31, 2025** |
|  Series A redeemable convertible preferred stock | 17256508 |
|  Series B redeemable convertible preferred stock | 8482146 |
|  Series B-1 redeemable convertible preferred stock | 3780769 |
|  Shares subject to outstanding common stock warrants | 1100000 |
|  Shares subject to outstanding stock options | 8177647 |
|  Shares reserved for future issuances under the 2023 Stock Options Plan | 2747295 |
|  Total | 41544365 |

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***Warrants***

In connection with the issuance of Series B Preferred Stock, the Company issued warrants to purchase up to 1,100,000 shares of Company's common stock (the "Warrants") with an exercise price of $21.37 per share, exercisable, in whole or in part, only upon the first date the Company achieves a valuation of $5.0 billion and until the tenth anniversary of the issuance date (September 4, 2035). The warrants, which were classified as equity, were initially recorded at fair value and do not require subsequent remeasurement.

The warrants were granted only to a select group of investors that led the Series B preferred stock financing round as economic incentive for their role. As a result, as of the issuance date, the fair value of the warrants in total amount of $7.4 million was recognized as a warrant issuance expense within its consolidated statement of operations and comprehensive loss.

The fair value of the warrants was measured using the Monte Carlo pricing model. Significant inputs into the model as of September 4, 2025 were as follows:

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| | |
|:---|:---|
| | **September 4, 2025** |
|  Exercise price | $21.37 |
|  Expected liquidity event date | June 6, 2027 |
|  Warrant expiration date | September 4, 2035 |
|  Common stock IPO threshold price | $21.37 |
|  Interest rate (annual) | 4.17% |

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As of December 31, 2025 no warrants were exercised and all remain outstanding.

**11. Stock-based compensation** 

***2023 stock option and grant plan (as amended and restated)***

The Company adopted the 2023 Stock Option and Grant Plan on August 18, 2023, which was subsequently amended and restated on June 6, 2024 (as amended and restated, the "2023 Plan"). The Plan provides for the grant of incentive stock options, non-statutory stock options and restricted stock awards to the employees, directors and consultants of the Company. The option exercise price of each option will be determined by the administrator of the 2023 Plan but may not be less than 100% of the fair market value of the Company's common stock on the date of grant, or in the case of an incentive stock option granted to a 10% owner, the exercise price shall not be less than 110% of the fair market value of the Company's common stock on the date of grant. The maximum term of the options granted under the Plan is no more than ten years. Service-based awards generally vest at 25% one year from the vesting commencement date and ratably each month thereafter for a period of 36 months, subject to continuous service. Performance and market-based awards would have individual vesting conditions. The shares of common stock underlying any awards that are forfeited,

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cancelled, reacquired by the Company prior to vesting, satisfied without the issuance of stock, or otherwise terminated (other than by exercise), or held back upon exercise or settlement of an award to satisfy the exercise price or tax withholding under the 2023 Plan are added back to the shares of common stock available for issuance under the 2023 Plan. No awards may be granted under the 2023 Plan following June 6, 2034.

As of December 31, 2025 and 2024, the Company had reserved 21,190,579 shares and 15,001,940 shares of common stock for issuance under the 2023 Plan, respectively. As of December 31, 2025 and 2024, the number of shares remaining for grant under the Plan were 2,747,295 and 779,987 shares, respectively.

The following table summarizes stock options activity, inclusive of early exercises, for the year ended December 31, 2025 (in thousands, except per share data and years):

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Number of<br>options** | **Weighted<br>average<br>exercise<br>price** | **Weighted<br>average<br>remaining<br>contractual<br>term** | **Aggregate<br>intrinsic<br>value** |
|  Outstanding at December 31, 2024 | 4111953 | $2.15 | 9.50 | $17352 |
|  Granted | 4600503 | 6.32 |  |  |
|  Exercised | 155637 | 3.60 |  |  |
|  Forfeited | 379172 | 4.44 |  |  |
|  Expired |  |  |  |  |
|  Outstanding at December 31, 2025 | 8177647 | $4.36 | 8.98 | $39810 |
|  Exercisable as of December 31, 2025 | 4493816 | $3.87 | 8.79 | $24102 |
|  Vested and expected to vest at December 31, 2025 | 8177647 | $4.36 | 8.98 | $39810 |

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The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying stock options and the estimated fair value of the Company's common stock for those stock options that had exercise prices lower than the estimated fair value of the Company's common stock.

The weighted-average grant date fair value of options granted during the years ended December 31, 2025 and 2024 were $5.72 and $6.34, respectively. The total intrinsic value of options exercised during the years ended December 31, 2025 and 2024 was $0.8 million and $6.8 million, respectively.

*Performance-based and market-based options* 

In June 2024, the Company's Chief Executive Officer was granted an early-exercisable non-qualified option to purchase up to 2,685,453 shares of the Company's common stock at a price per share of $2.15. The options vest contingent upon the satisfaction of the service, performance and market conditions. The service condition is satisfied if the optionee maintains continuous service as the Company's Chief Executive Officer through June 6, 2027. The market condition is structured in five tranches, under which certain percentage of the options vest upon the Company achieving market valuation thresholds at specified levels. The performance condition applies only to 585,558 shares and is satisfied upon the occurrence of specified acquisition by a predetermined date. This performance condition has been met upon the closing of the license agreement with BMS (refer to Note 5, "*Acquisitions and Licensing Agreements"*). No options vested, and no options were exercised as of and for the years ended December 31, 2025 and 2024, and the Company recognized related stock-based compensation expense of $4.2 million and $2.4 million, respectively.

In October 2025, the Company's Chief Executive Officer was granted an early-exercisable non-qualified option to purchase up to 879,567 shares of the Company's common stock at the price per share of $9.23, with vesting tied to specific service and market conditions. The service condition is satisfied if the optionee maintains continuous service as the Company's Chief Executive Officer through June 6, 2027. The market condition is

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structured in four tranches, under which certain percentage of the options vest upon the Company achieving market valuation thresholds at specified levels. No options vested, and no options were exercised as of and for the year ended December 31, 2025; however, the Company recognized related stock-based compensation expense of $0.6 million.

The fair value of these awards was determined using a Monte Carlo simulation. The valuation assumptions utilized in the Monte Carlo model are generally consistent with the inputs discussed in the valuation of stock options below, except for volatility ranging from 80.0% to 90.0% and expected term of 9.0 to 10.0 years.

***Early exercise liability***

The 2023 Plan allows for the early exercise of all stock options granted if authorized by the board of directors at the time of grant. Any shares of common stock issued from the early exercise of stock options are restricted and vest over time. The Company has the option to repurchase any unvested shares at the lower of the original issue price or current fair value upon any voluntary or involuntary termination of such optionee. For accounting purposes, the early exercise of options is not considered to be a substantive exercise until the underlying awards vest and are not considered to be outstanding until those shares vest. The early-exercise liability is included within other non-current liabilities on the consolidated balance sheets.

The following table summarizes the early-exercise of options activity and related early-exercise liability for the years ended December 31, 2025 and December 31, 2024 (in thousands, except for shares data):

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| | | |
|:---|:---|:---|
| | **Shares** | **Early-exercise liability** |
|  Balance at January 1, 2024 |  | $— |
|  Issuance of common stock upon early-exercise of stock options | 1100000 | 2365 |
|  Vesting of early-exercised common stock options |  |  |
|  Balance at December 31, 2024 | 1100000 | $2365 |
|  Issuance of common stock upon early-exercise of stock options | 38792 | 195 |
|  Vesting of early-exercised common stock options | (402311) | (901) |
|  Balance at December 31, 2025 | 736481 | $1659 |

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***Restricted stock awards***

In August 2023, upon incorporation, the Company issued 5,000,000 shares of Class F-1 common stock at $0.00001 par value per share to its Chief Executive Officer, and 2,500,000 shares of Class F-2 common stock at $0.00001 par value per share to its Chief Medical Officer, under respective restricted stock agreements that provided for 80% of the shares to vest immediately, with the remaining 20% vesting in equal monthly installments over a 24-month period. Concurrently, the Company issued 1,500,000 restricted common stock awards to other senior executives that vest in equal monthly installments over a 24-month period. In June 2024, in connection with the Company's Series A preferred stock financing, each share of Class F-1 common stock and Class F-2 common stock then outstanding was converted into common stock on a one-for-one basis, collectively resulting in 7,500,000 shares of common stock issued.

Although these awards were subject to certain vesting conditions, at the time of the grant the Company had no assets, no active operations and no measurable enterprise value, therefore the grant date fair value of these awards was considered de minimis, and accordingly, no stock-based compensation expense was recognized with respect to these awards for the years ending December 31, 2025 and 2024.

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*Modification of Chief Medical Officer Award* 

The original vesting terms of the Chief Medical Officer's award of 2,500,000 shares granted in August 2023 provided for 80% of the shares to vest immediately, with the remaining 20% vesting in equal monthly installments over a 24-month period.

On June 6, 2024, in connection with the Company's Series A financing and adoption of the Amended and Restated 2023 Stock Option and Grant Plan, the Company revised the vesting terms of the award to provide for 50% immediate vesting, with the remaining 50% vesting monthly over 36 months from the new vesting commencement date. The Company determined that this was an escrowed share arrangement under ASC 718 and determined that the shares were a new compensatory award. The incremental compensation cost of $7.8 million was measured as the excess of the fair value of the modified award over the fair value of the original award immediately prior to modification, to be recognized over a 36-month service period starting on June 6, 2024. As a result of this modification, the Company recorded total stock-based compensation expense related to this award of $2.6 million and $1.5 million, during the year ended December 31, 2025 and 2024, respectively. For purposes of the net loss per share calculation, the Company determined that the modification is equivalent to a reverse stock split and, accordingly, adjusted the weighted-average number of unvested restricted stock shares under the Chief Medical Officer's award as if those terms had been in effect for all periods presented.

The following table summarizes restricted stock awards activity for the year ended December 31, 2025:

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| | | |
|:---|:---|:---|
| | **Shares** | **Weighted average<br>grant date FV** |
|  Unvested restricted stock awards as of December 31, 2024 | 1875002 | $4.14 |
|  Granted |  |  |
|  Vested | (1250002) | 2.07 |
|  Forfeited |  |  |
|  Unvested restricted stock awards as of December 31, 2025 | 625000 | $8.29 |

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***Stock-based compensation expense***

The following table summarizes the weighted-average assumptions used in the Black-Scholes option pricing model, for the years ended December 31, 2025, and 2024:

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  Risk-free interest rate | 4.01% | 3.97% |
|  Expected term | 6.00 | 6.01 |
|  Volatility of common stock | 76.02% | 77.00% |
|  Expected dividend rate |  |  |
|  Fair value per share of common stock | $7.37 | $8.15 |

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*Risk-free interest rate.* The Company based the risk-free interest rate assumption on the U.S. Treasury's rates for U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the award being valued.

*Expected volatility.* Given that the Company's common stock is privately held, there has been no active trading market for its common stock. The expected volatility assumption is based on volatilities of a peer group of similar companies whose share prices are publicly available. The peer group was developed based on companies in the biotechnology industry. The peer group used to estimate expected volatility was selected

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based on similarity of industry focus, development stage, size, and risk profile. Management reassesses the peer group periodically to ensure continued relevance.

*Expected term.* The expected term represents the period of time that options are expected to be outstanding. Because the Company does not have historical exercise behavior, it determines the expected life assumption using the "simplified" method, which is an average of the contractual term of the option and its vesting period.

*Expected dividend yield.* The Company used an expected dividend yield of zero, as it has never paid dividends on its common stock and has no present intention of doing so in the foreseeable future.

The table below represents the breakdown of the total Stock-Based Compensation Expense by each respective category for the years ended December 31, 2025 and December 31, 2024 (in thousands):

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  Service-based options | $8501 | $2071 |
|  Performance- and market-based options | 4761 | 2372 |
|  Restricted stock awards | 2591 | 1511 |
|  Stock-based compensation expense related to integration bonus | 14360 |  |
|  Total stock-based compensation expense | $30213 | $5954 |

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Stock-based compensation expense was included in the consolidated statements of operations and comprehensive loss as follows (in thousands):

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  Research and development | $9725 | $982 |
|  General and administrative | 20488 | 4972 |
|  Total stock-based compensation expense | $30213 | $5954 |

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As of December 31, 2025, unrecognized stock-based compensation expense related to unvested awards totaled $39.6 million, which is expected to be recognized over a weighted-average period of 3.0 years.

**12. Income taxes** 

Loss before provisions for income taxes was distributed geographically for the years ended December 31, 2025 and December 31, 2024 as follows (in thousands):

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  United States | $(196453) | (88658) |

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The provision for income taxes is as follows for the year ended December 31, 2025 and December 31, 2024 (in thousands):

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  **Current** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Federal | $— | $— |
| &nbsp;&nbsp;&nbsp;&nbsp; State |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Foreign |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total current | $— | $— |
|  **Deferred** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Federal | $(4512) | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;— |
| &nbsp;&nbsp;&nbsp;&nbsp; State |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Foreign |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Total deferred | $(4512) | $— |
|  Total provision (benefit) | $(4512) | $— |

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Pursuant to the disclosure requirements of ASU 2023-09, the reconciliations of taxes at the federal statutory rate to the Company's provision for income taxes for the twelve months ended December 31, 2025 and December 31, 2024, are as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **2025** | **2025** | **2024** | **2024** |
| | **(in thousands)** | **Percentage %** | **(in thousands)** | **Percentage %** |
|  US federal statutory tax rate | $(41255) | 21.00% | $(18618) | 21.00% |
|  State & local income taxes, net of federal effect(1) |  | —% |  | —% |
|  Tax credits | (1038) | 0.53% |  | —% |
|  Changes in valuation allowance | 34667 | (17.65)% | 16318 | (18.41)% |
|  Nontaxable or nondeductible items |  |  |  |  |
|  Fair value adjustments on financial instruments | 1314 | (0.67)% | (1418) | 1.60% |
|  Nondeductible consideration payments | 630 | 0.24% | 3343 | (3.77)% |
|  Other | 1170 | (1.15)% | 375 | (0.42)% |
|  Income Tax Provision | $(4512) | 2.30% | $— | (0.00)% |

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<sup>(1)</sup> The states and local tax effect in this category is not material to the financial statements.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. The OBBBA extends permanently, with modifications, tax provisions enacted as part of the 2017 Tax Cuts and Jobs Act and restores and makes permanent many business provisions, such as full expensing for domestic research and development and capital investments. The enactment of the OBBBA does not have a material impact on the results from operations for the year ended December 31, 2025.

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Significant components of the deferred tax asset balances at December 31, 2025 and December 31, 2024 are as follows (in thousands):

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| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  **Deferred tax assets:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Fixed assets and intangibles | $11425 | $10444 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net operating losses | 12250 | 989 |
| &nbsp;&nbsp;&nbsp;&nbsp; Lease liabilities | 2947 | 2014 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accruals and reserves | 2617 | 886 |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax credits | 1546 | 74 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock based compensation | 2422 | 1009 |
| &nbsp;&nbsp;&nbsp;&nbsp; Capitalization of expenses | 35238 | 3965 |
|  Gross deferred tax assets | $68445 | $19381 |
|  Valuation allowance | (61007) | (17455) |
|  Total deferred tax assets, net of valuation allowance | $7438 | $1926 |
|  **Deferred tax liabilities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Right-of-use assets | (2501) | (1926) |
| &nbsp;&nbsp;&nbsp;&nbsp; Non-deductible intangibles | (4937) |  |
|  Gross deferred tax liabilities | (7438) | (1926) |
|  Deferred tax assets (liabilities), net of valuation allowance | $— | $— |

---

Cash paid for income taxes, net of refunds received, by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 was immaterial for the years ended December 31, 2025 and 2024.

A valuation allowance is required to be established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Realization of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. The Company believes that, based on a number of factors such as the history of operating losses, it is more likely than not that the deferred tax assets will not be fully realized, such that a full valuation allowance has been recorded. Accordingly, the Company has recorded a valuation allowance against its net U.S. deferred tax assets. The valuation allowance increased by $43.6 million for the reporting period ended December 31, 2025, primarily due to net operating losses carryforwards and capitalized research and development expenditures not benefited, partially offset by a valuation allowance release related to acquired deferred tax liabilities, which resulted in an income tax benefit of $4.5 million recognized for the year ended December 31, 2025.

As of December 31, 2025, the Company had cumulative U.S. federal net operating losses of $56.5 million which carry forward indefinitely, and research and development tax credits of $7.6 million, which begins to expire in 2045. As of December 31, 2025, the Company had cumulative state net operating losses of $2.1 million which begin to expire in 2040 and research and development tax credits of $1.0 million which carry forward indefinitely.

Utilization of some of the federal and state net operating loss and credit carryforwards may be subject to annual limitations due to the change in ownership provisions of the Internal Revenue Code of 1986, as amended ("I.R.C."), and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. As of December 31, 2025, the Company has not completed an I.R.C. section 382 analysis.

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*Uncertain tax positions* 

The Company accounts for uncertain tax positions in accordance with ASC 740-10. The Company assesses all material positions taken in any income tax return, including all significant uncertain positions, in all tax years that are still subject to assessment or challenge by relevant taxing authorities. Assessing an uncertain tax position begins with the initial determination of the position's sustainability and is measured at the largest amount of benefit that is greater than fifty percent likely of being realized upon ultimate settlement. As of each balance sheet date, unresolved uncertain tax positions must be reassessed, and the Company will determine whether (i) the factors underlying the sustainability assertion have changed and (ii) the amount of the recognized tax benefit is still appropriate. The recognition and measurement of tax benefits requires significant judgment. Judgments concerning the recognition and measurement of a tax benefit might change as new information becomes available.

The following table reconciles the beginning and ending balances of the Company's unrecognized tax benefit, excluding related accrued interest and penalties at December 31, 2025 and December 31, 2024 (in thousands):

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  Gross unrecognized tax benefits balance as January 1, | $74 | $— |
|  Additions for tax positions, current year | 1472 | 74 |
|  Reductions for tax positions, current year |  |  |
|  Gross unrecognized tax benefits balance at December 31, | $1546 | $74 |

---

As of December 31, 2025, the Company had gross unrecognized tax benefits of $1.5 million, none of which will affect the effective tax rate if recognized due to the federal and state valuation allowance.

The Company has not accrued any interest or penalties related to unrecognized tax benefits as of December 31, 2025. The Company's policy for classifying interest and penalties associated with unrecognized income tax benefits is to include such items in income tax expense.

The Company's major jurisdiction are the U.S. federal and state jurisdictions. As a result of the Company's tax attribute carryforwards, all tax years through 2025 remain subject to examination for U.S. income tax purposes. The Company is not currently under any federal or state income tax examinations.

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**13. Net loss per share** 

The following table sets forth the computation of basic and diluted net loss per share (in thousands, except share and per share data):

---

| | | |
|:---|:---|:---|
|  | **Years Ended December 31,** | **Years Ended December 31,** |
| | **2025** | **2024** |
|  Numerator: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Net loss—basic and diluted | $(191941) | $(88658) |
|  Denominator: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Weighted-average number of shares of common stock outstanding | 10168180 | 9379809 |
| &nbsp;&nbsp;&nbsp;&nbsp; Less: Weighted-average number of shares of common stock subject to repurchase | (945605) | (370219) |
| &nbsp;&nbsp;&nbsp;&nbsp; Less: Weighted-average number of shares of unvested restricted common stock | (1100458) | (2676819) |
|  Weighted-average number of shares of common stock outstanding—basic and diluted | 8122117 | 6332771 |
|  Net loss per share—basic and diluted | $(23.63) | $(14.00) |

---

The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding because such securities have an anti-dilutive effect due to the Company's net loss, in common stock equivalent shares:

---

| | | |
|:---|:---|:---|
|  | **Years Ended December 31,** | **Years Ended December 31,** |
| | **2025** | **2024** |
|  Redeemable convertible preferred stock | 29519423 | 6959334 |
|  Shares subject to outstanding stock options | 8177647 | 4111953 |
|  Shares subject to outstanding common stock warrants | 1100000 |  |
|  Unvested restricted stock | 625000 | 1875002 |
|  Unvested exercised options subject to repurchase | 736481 | 1100000 |
|  Total | 40158551 | 14046289 |

---

**14. Segment reporting** 

The Company views its operations and manages its business as one operating segment, focused on the discovery and development of novel cardiovascular drugs for the treatment of heart diseases.

The chief operating decision maker ("CODM"), is responsible for making decisions regarding resource allocation and assessing performance. The Company's CODM is its Chief Executive Officer. No revenue has been generated since inception, and all assets are held in the United States.

The CODM assesses performance of the business, monitors budget versus actual results and manages and allocates resources to the Company's operations using consolidated net loss as the primary measurement. The CODM is regularly provided with entity-wide expense categories that are largely consistent with those found on the Company's consolidated statements of operations and comprehensive loss. The measure of segment assets is reported on the consolidated balance sheets as total consolidated assets.

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The table below is a summary of the segment loss, including significant segment expenses (in thousands):

---

| | | |
|:---|:---|:---|
| | **2025** | **2024** |
|  Program expenses: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Ataciguat | $29126 | $17477 |
| &nbsp;&nbsp;&nbsp;&nbsp; Tonlamarsen | 23874 | 21986 |
| &nbsp;&nbsp;&nbsp;&nbsp; Danicamtiv | 13788 | 23896 |
|  Research and development—compensation and benefits\* | 49761 | 8176 |
|  Research and development—other | 36537 | 12759 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total Research and development expense | 153086 | 84294 |
|  General and administrative expense—compensation and benefits\* | 32812 | 6317 |
|  General and administrative expense—other | 15938 | 6045 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total general and administrative expense | 48750 | 12362 |
| &nbsp;&nbsp;&nbsp;&nbsp; Total operating expense | 201836 | 96656 |
|  Other income/expense\*\* | (5383) | (7998) |
|  Loss before income taxes | $196453 | $88658 |

---

\* Includes stock-based compensation expense

\*\* Other income (expense) for the year ended December 31, 2025 primarily includes bargain purchase gain, change in fair value of Series A preferred stock tranche obligations, interest income, and warrant issuance loss. Other income (expense) for the year ended December 31, 2024 primarily includes change in fair value of Series A preferred stock tranche obligations and interest income.

**15. Related party transactions** 

***Safe notes***

From September 2023 through April 2024, the Company issued a series of SAFE Notes for the aggregate amount of $0.9 million to the entities controlled by the Company's CEO and his spouse. Upon the issuance of Series A preferred stock in June 2024, the SAFEs automatically converted into 43,762 shares of Series A preferred stock.

***Prolaio Transactions***

On February 24, 2025, the Company acquired 100% of the outstanding shares of Prolaio, Inc. At the time of the acquisition, Tassos Gianakakos, our Chief Executive Officer, also served as Prolaio's Chief Executive Officer and Jay Edelberg, our Chief Medical Officer, served as its President, Research & Development. Mr. Gianakakos and Dr. Edelberg owned 55.7% and 16.6%, respectively, of Prolaio at the time of its acquisition. Accordingly, Prolaio was considered a related party during the pre acquisition period, and the Prolaio acquisition itself constituted a related party transaction. Refer to Note 5, "*Acquisitions and Licensing Agreements*" for additional information.

During the pre-acquisition period, Prolaio provided services to the Company utilizing its proprietary device, data collection, and analytics platform in support of the development of the Company's cardiovascular product candidates.

In 2024, the Company issued a prepayment for future services for a total amount of $0.5 million. Services for a total amount of $0.2 million were provided to the Company during the year ended December 31, 2024, and accordingly the Company recorded a prepaid expense balance of $0.3 million as of December 31, 2024. In the period from January 1, 2025 through February 24, 2025 (the respective acquisition date), the Company made another prepayment for a total amount of $0.3 million, and recognized $0.3 million of expense related to services

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performed by Prolaio. The Company had a prepaid expense balance of $0.3 million as of the acquisition date. Subsequent balances and transactions between Prolaio and the Company are eliminated at consolidated level.

***Demand promissory note***

On May 30, 2024, the Company issued a demand promissory note (the "Demand Note") in the principal amount of $0.2 million to the Company's Chief Executive Officer, payable on demand on or after June 3, 2024. The Demand Note accrued interest at the rate of 6.0% per annum and could be repaid in whole or in part any time without prepayment premium or penalty. The Company repaid the Demand Note on July 3, 2024 in connection with the Series A financing.

**16. Subsequent events** 

The Company evaluated all events subsequent to December 31, 2025 and through March 26, 2026, which represents the date these financial statements were available to be issued. The Company concluded that no subsequent events have occurred that require disclosure except as discussed below.

On February 12, 2026, the Company adopted an Amended and Restated 2023 Stock Option Plan, under which the total number of authorized shares reserved and available for issuance was increased to 22,490,579 shares. Under the Plan, through March 11, 2026, the Company's board of directors granted stock options, to various employees and consultants, to purchase an aggregate of 2,059,429 shares of the Company's common stock at an exercise price of $9.23 per share.

On March 20, 2026, the Company sold and issued an aggregate of 468,053 additional shares of Series B preferred stock for $21.37 per share, on the same terms and conditions as the Series B Initial Closing, for gross proceeds of $10.0 million.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;***Shares***

![LOGO](g107928g00v01.jpg)

***Common Stock***

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| | | | |
|:---|:---|:---|:---|
| **J.P. Morgan** | **Jefferies** | **Leerink Partners** | **TD Cowen** |

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##### [**Table of Contents**](#toc)
**Part II** 

**Information not required in prospectus** 

Unless otherwise indicated, all references to "Kardigan," the "company," "we," "our," "us" or similar terms refer to Kardigan, Inc. and its wholly owned, consolidated subsidiaries, or either or both of them as the context may require.

**Item 13. Other expenses of issuance and distribution.** 

The following table sets forth all expenses to be paid by us, other than underwriting discounts and commissions, in connection with this offering. All amounts shown are estimates except for the Securities and Exchange Commission ("SEC") registration fee, the Financial Industry Regulatory Authority, Inc. ("FINRA") filing fee and stock exchange listing fee.

---

| | |
|:---|:---|
|  SEC registration fee | $\* |
|  FINRA filing fee | \* |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; listing fee | \* |
|  Printing and mailing expenses | \* |
|  Legal fees and expenses | \* |
|  Accounting fees and expenses | \* |
|  Transfer agent and registrar fees and expenses | \* |
|  Miscellaneous expenses | \* |
|  Total | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;\* |

---

\* To be provided by amendment.

**Item 14. Indemnification of directors and officers.** 

Section 145 of the Delaware General Corporation Law ("DGCL") authorizes a corporation to indemnify its directors and officers against liabilities arising out of actions, suits and proceedings to which they are made or threatened to be made a party by reason of the fact that they have served or are currently serving as a director or officer to a corporation. The indemnity may cover expenses (including attorneys' fees) judgments, fines, and amounts paid in settlement actually and reasonably incurred by the director or officer in connection with any such action, suit or proceeding. Section 145 permits corporations to pay expenses (including attorneys' fees) incurred by directors and officers in advance of the final disposition of such action, suit or proceeding. In addition, Section 145 provides that a corporation has the power to purchase and maintain insurance on behalf of its directors and officers against any liability asserted against them and incurred by them in their capacity as a director or officer, or arising out of their status as such, whether or not the corporation would have the power to indemnify the director or officer against such liability under Section 145.

We will adopt provisions in our third amended and restated certificate of incorporation, which will become effective upon the completion of this offering, and the amended and restated bylaws, which will become effective upon the effectiveness of the registration statement of which this prospectus forms a part, that limit or eliminate the personal liability of our directors and officers to the fullest extent permitted by the DGCL, as it now exists or may in the future be amended. Consequently, our directors and officers will not be personally liable to us or our stockholders for monetary damages or breach of fiduciary duty as directors or officers, except for liability for:

• any breach of their duty of loyalty to us or our stockholders;

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##### [**Table of Contents**](#toc)
• any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

• for our directors, any unlawful payments related to dividends or unlawful stock purchases, redemptions or other
distributions;

• any transaction from which they derived an improper personal benefit; or

• for our officers, any derivative action by or in the right of the corporation.

These limitations of liability do not alter director and officer liability under the federal securities laws and do not affect the availability of equitable remedies such as an injunction or rescission.

In addition, our amended and restated bylaws will provide that:

• we will indemnify our directors, officers and, in the discretion of our board of directors, certain employees to the
fullest extent permitted by the DGCL, as it now exists or may in the future be amended; and

• we will advance reasonable expenses, including attorneys' fees, to our directors and, in the discretion of our board
of directors, to our officers and certain employees, in connection with legal proceedings relating to their service for or on behalf of us, subject to limited exceptions.

We have entered into indemnification agreements with each of our directors and intend to enter into such agreements with our executive officers. These agreements provide that we will indemnify each of our directors, our executive officers and, at times, their affiliates to the fullest extent permitted by Delaware law. We will advance expenses, including attorneys' fees (but excluding judgments, fines and settlement amounts), to each indemnified director, executive officer or affiliate in connection with any proceeding in which indemnification is available and we will indemnify our directors and officers for any action or proceeding arising out of that person's services as a director or officer brought on behalf of us or in furtherance of our rights. Additionally, certain of our directors or officers may have certain rights to indemnification, advancement of expenses or insurance provided by their affiliates or other third parties, which indemnification relates to and might apply to the same proceedings arising out of such director's or officer's services as a director referenced herein. Nonetheless, we have agreed in the indemnification agreements that our obligations to those same directors or officers are primary and any obligation of such affiliates or other third parties to advance expenses or to provide indemnification for the expenses or liabilities incurred by those directors are secondary.

We also maintain general liability insurance which covers certain liabilities of our directors and officers arising out of claims based on acts or omissions in their capacities as directors or officers, including liabilities under the Securities Act of 1933, as amended ("Securities Act").

The underwriting agreement filed as Exhibit 1.1 to this registration statement provides for indemnification of us and our directors and officers by the underwriters against certain liabilities under the Securities Act and the Securities Exchange Act of 1934.

**Item 15. Recent sales of unregistered securities.** 

Set forth below is information regarding securities we have issued within the past three years that were not registered under the Securities Act. ****

***(a) Preferred stock issuances***

From June 2024 through August 2025, we sold an aggregate of 17,256,508 shares of Series A redeemable convertible preferred stock to accredited investors at a purchase price of $19.4228 per share, for an aggregate purchase price of approximately $305.2 million.

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From September 2025 through March 2026, we sold an aggregate of 8,950,199 shares of Series B redeemable convertible preferred stock to accredited investors at a purchase price of $21.3651 per share, for an aggregate purchase price of approximately $191.2 million.

From September 2025 through October 2025, we sold an aggregate of 3,780,769 shares of Series B-1 redeemable convertible preferred stock to accredited investors at a purchase price of $21.3651 per share, for an aggregate purchase price of approximately $80.8 million.

***(b) Common stock issuances***

Since August 2023, we granted to our employees, consultants, and other service providers shares of restricted Common Stock representing an aggregate of 9,010,000 shares of restricted Common Stock.

In February 2026, we issued an aggregate of 28,082 shares of Common Stock in consideration for rights granted to us under certain license agreements.

***(c) Convertible notes***

From September 2023 to April 2024, we issued convertible promissory notes having an aggregate principal amount of $850,000.

***(d) Warrants***

In September 2025, we sold warrants to purchase up to 1,100,000 shares of our common stock, with an exercise price of $21.37 per share.

The offers, sales and issuances of the securities described above were deemed to be exempt under Section 4(a)(2) of the Securities Act or Rule 506 of Regulation D under the Securities Act as a transaction by an issuer not involving a public offering. The recipients of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof and appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions was an accredited investor within the meaning of Rule 501 of Regulation D under the Securities Act and had adequate access, through employment, business or other relationships, to information about us. No underwriters were involved in these transactions.

***(e) Grants and exercises of stock options***

Since August 2023 , we have granted certain employees, consultants, and directors options to purchase an aggregate of 11,896,885 shares of our common stock under our 2023 Plan, at exercise prices ranging from $2.15 to $9.23 per share.

Since August 2023, 1,361,993 shares of common stock have been issued upon the exercise of stock options pursuant to the 2023 Plan.

None of the foregoing transactions involved any underwriters, underwriting discounts or commissions, or any public offering. The offers, sales and issuances of the securities described above were deemed to be exempt from registration under Rule 701 promulgated under the Securities Act as transactions under compensatory benefit plans and contracts relating to compensation, or under Section 4(a)(2) of the Securities Act as a transaction by an issuer not involving a public offering. The recipients of such securities were our directors, employees or bona fide consultants and received the securities under our equity incentive plans. Appropriate

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legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions had adequate access, through employment, business or other relationships, to information about us. The sales of these securities were made without any general solicitation or advertising.

**Item 16. Exhibits and financial statement schedules.** 

(a) Exhibits.

---

| | |
|:---|:---|
| **Exhibit <br>Number** | **Description** |
| 1.1\* | Form of Underwriting Agreement. |
| 3.1 | Second Amended and Restated Certificate of Incorporation, as amended, as currently in effect. |
| 3.2\* | Form of Third Amended and Restated Certificate of Incorporation, to be in effect upon the completion of this offering. |
| 3.3 | Bylaws, as currently in effect. |
| 3.4\* | Form of Amended and Restated Bylaws, to be in effect as of the effectiveness of the registration statement of which this prospectus forms a part. |
| 4.1\* | Specimen Common Stock Certificate. |
| 4.2 | Warrant to Purchase Shares of Common Stock, by and between the Registrant and ARCH Venture Fund XIII, L.P., dated as of September 4, 2025. |
| 4.3 | Warrant to Purchase Shares of Common Stock, by and between the Registrant and SCHF (M) PV, L.P., dated as of September 4, 2025. |
| 4.4\*+ | Amended and Restated Investors' Rights Agreement, by and between the Registrant and certain of its stockholders, dated as of September 4, 2025. |
| 5.1\* | Opinion of Goodwin Procter LLP. |
| 10.1# | 2023 Stock Option and Grant Plan, as amended, and form of award agreements thereunder. |
| 10.2\*# | Kardigan, Inc. 2026 Stock Option and Incentive Plan and form of award agreements thereunder. |
| 10.3\*# | Kardigan, Inc. 2026 Employee Stock Purchase Plan. |
| 10.4\*# | Form of Indemnification Agreement, by and between the Registrant and its directors and executive officers. |
| 10.5\*# | Senior Executive Cash Incentive Bonus Plan. |
| 10.6\*# | Executive Severance Plan |
| 10.7\*# | Non-Employee Director Compensation Policy. |
| 10.8\*# | Form of Executive Employment Agreement, to be in effect upon the completion of this offering. |
| 10.9# | Bonus Agreement, by and between the Registrant and Tassos Gianakakos dated as of February 24, 2025, as amended by the Bonus Integration Agreement, by and between the Registrant and Tassos Gianakakos, dated September 4, 2025. |
| 10.10# | Bonus Agreement, by and between the Registrant and Jay Edelberg dated as of February 24, 2025, as amended by the Bonus Integration Agreement, by and between the Registrant and Jay Edelberg, dated September 4, 2025. |
| 10.11\* | License Agreement, by and between the Registrant and MyoKardia, Inc., dated as of November 4, 2024. |

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| | |
|:---|:---|
| **Exhibit <br>Number** | **Description** |
| 10.12\* | License Agreement, by and between the Registrant and Bristol-Myers Squibb Company, dated as of November 4, 2024. |
| 10.13\* | License Agreement, between Registrant and Ionis Pharmaceuticals, Inc., dated on or about June 5, 2024 |
| 10.14\* | License Agreement between Rancho Santa Fe Bio, Inc. and Sanofi, dated June 2, 2021, as amended March 18, 2022, January 9, 2023, and November 7, 2025. |
| 10.15\* | Patent License Agreement between Rancho Santa Fe Bio, Inc. and Mayo Foundation for Medical Education and Research, dated December 6, 2019, as amended on May 20, 2021, August 23, 2023, March 10, 2024, June 6, 2024, and December 22, 2025. |
| 10.16\* | Merger Agreement, by and between the Registrant and Prolaio, Inc., dated as of February 24, 2025. |
| 10.17\* | Agreement and Plan of Merger by and among the Registrant, RSF Merger Sub, Inc., Rancho Santa Fe Bio, Inc. and Shareholder Representative Services LLC, as the Representative, dated as of March 11, 2024. |
| 10.18 | The Cove Lease, by and between the Registrant and HCP Oyster Point III, LLC, dated September 17, 2024. |
| 10.19 | Lease and Lease Agreement by and between Carnegie 506 Associates and the Registrant, dated February 18, 2025. |
| 21.1 | Subsidiaries of Registrant. |
| 23.1\* | Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm. |
| 23.2\* | Consent of Goodwin Procter LLP (included in Exhibit 5.1). |
| 24.1\* | Power of Attorney (included on signature page). |
| 107\* | Filing Fee Table. |

---

\* To be filed by amendment.

# Indicates a management contract or any compensatory plan, contract or arrangement.

† Certain portions of this document that constitute confidential information have been redacted pursuant to Item 601(b)(10) of Regulation S-K.

+ Certain exhibits and schedules to these agreements have been omitted pursuant to Item 601(a)(5) and (6) of Regulation S-K. The registrant will furnish copies of any of the exhibits and schedules to the Securities and Exchange Commission upon request.

(b) Financial Statement Schedules.

All financial statement schedules are omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or the notes thereto.

**Item 17. Undertakings.** 

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling

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precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

The registrant hereby undertakes that:

(a) The Registrant will provide to the underwriter at the closing as specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

(b) For purposes of determining any liability under the Securities Act of 1933, as amended, the information omitted from a form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in the form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act of 1933, as amended, shall be deemed to be part of this registration statement as of the time it was declared effective.

(c) For the purpose of determining any liability under the Securities Act of 1933, as amended, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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**Signatures** 

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Francisco, California, on the of , 2026.

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| | |
|:---|:---|
| **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: |  |
|  | Name: Tassos Gianakakos |
|  | Title: Chief Executive Officer, Director, and Chair |

---

**Power of attorney and signatures** 

Each individual whose signature appears below hereby constitutes and appoints Tassos Gianakakos and Brianne Puglisi as such person's true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for such person in such person's name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement (or any Registration Statement for the same offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933), and to file the same, with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that any said attorney-in-fact and agent, or any substitute or substitutes of any of them, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement and Power of Attorney has been signed by the following person in the capacities and on the date indicated.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> Tassos Gianakakos | Chief Executive Officer, Director, and Chairman<br> (*Principal Executive Officer*) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> Brianne Puglisi | Chief Financial Officer<br> (*Principal Financial Officer and Principal Accounting Officer*) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> Paul Berns | Director | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> David Meeker, M.D. | Director | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> Douglas Giordano | Director | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br> Kim Popovits | Director | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2026 |

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## Exhibit 3.1

**Exhibit 3.1** 

**SECOND AMENDED AND RESTATED** 

**CERTIFICATE OF INCORPORATION** 

**OF** 

**KARDIGAN, INC.** 

(Pursuant to Sections 242 and 245 of the

General Corporation Law of the State of Delaware)

Kardigan, Inc., a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the "**General Corporation Law**"),

**DOES HEREBY CERTIFY:** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** That the name of this corporation is Kardigan, Inc., and that this corporation was originally incorporated pursuant to the General Corporation Law on August 18, 2023 under the name EnCarda, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** That the Board of Directors of this corporation (the "**Board of Directors**") duly adopted resolutions proposing to amend and restate the amended and restated Certificate of Incorporation, as amended, of this corporation, declaring said amendment and restatement to be advisable and in the best interests of this corporation and its stockholders, and authorizing the appropriate officers of this corporation to solicit the consent of the stockholders therefor, which resolution setting forth the proposed amendment and restatement is as follows:

**RESOLVED**, that the Amended and Restated Certificate of Incorporation of this corporation be amended and restated in its entirety to read as follows:

**FIRST**: The name of this corporation is Kardigan, Inc. (the "**Corporation**").

**SECOND**: The address of the registered office of the Corporation in the State of Delaware is 1209 Orange Street, in the City of Wilmington, County of New Castle, 19801. The name of its registered agent at such address is THE CORPORATION TRUST COMPANY.

**THIRD**: The nature of the business or purposes to be conducted or promoted is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law.

**FOURTH**: The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 77,991,937. The Corporation has two classes of stock, referred to as Common Stock and Preferred Stock. There are 51,000,000 shares of authorized Common Stock, $0.00001 par value per share ("**Common Stock**") and 26,991,937 shares of authorized Preferred Stock, $0.00001 par value per share ("**Preferred Stock**"), 17,256,508 of which are hereby designated as "**Series A Preferred Stock**", 5,954,660 of which are hereby designated as "**Series B Preferred Stock**" and 3,780,769 of which are hereby designated as "**Series B-1 Preferred Stock**").

The following is a statement of the designations and the powers, preferences and special rights, and the qualifications, limitations or restrictions thereof in respect of each class of capital stock of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. COMMON STOCK

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>General</u>. The voting, dividend and liquidation rights of the holders of the Common Stock are subject to and qualified by the powers, preferences and special rights of the holders of the Preferred Stock set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Voting</u>. Except as otherwise provided herein or by applicable law, the holders of the Common Stock shall be entitled to one (1) vote for each share of Common Stock held as of the applicable record date for each meeting of stockholders (and written actions in lieu of meetings); <u>provided</u>, <u>however</u>, that, except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to this Second Amended and Restated Certificate of Incorporation (this "**Certificate of Incorporation**") that relates solely to the terms of one (1) or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together with the holders of one (1) or more other such series, to vote thereon pursuant to this Certificate of Incorporation or pursuant to the General Corporation Law. There shall be no cumulative voting. The number of authorized shares of Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by (in addition to any vote of the holders of one or more series of Preferred Stock that may be required by the terms of this Certificate of Incorporation) the affirmative vote of the holders of shares of capital stock of the Corporation representing a majority of the votes represented by all outstanding shares of capital stock of the Corporation entitled to vote, irrespective of the provisions of Section 242(b)(2) of the General Corporation Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. PREFERRED STOCK

The shares of the Preferred Stock shall have the powers, preferences and special rights set forth in this Part B of this <u>Article Fourth</u>. Unless otherwise indicated, references to "sections" or "Sections" in this Part B of this <u>Article Fourth</u> refer to sections of Part B of this <u>Article Fourth</u>. References to "Preferred Stock" mean, collectively, the Series A Preferred Stock, the Series B Preferred Stock and the Series B-1 Preferred Stock. References to the "Voting Preferred Stock" mean, collectively, the Series A Preferred Stock and the Series B Preferred Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Dividends</u>.

The Corporation shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock of the Corporation (other than dividends on shares of Common Stock payable in shares of Common Stock) unless (in addition to the obtaining of any consents required elsewhere in this Certificate of Incorporation) the holders of the Preferred Stock then outstanding shall first receive, or simultaneously receive, a dividend on each outstanding share of Preferred Stock in an amount at least equal to (i) in the case of a dividend on Common Stock, the product of (A) the dividend declared, paid or set aside on such Common Stock and (B) the number of shares of Common Stock issuable upon conversion of a share of such Preferred Stock; (ii) in the case of a dividend on a class or series of capital stock that is convertible into Common Stock, the product of (A) the dividend declared, paid or set aside per share of such class or series of capital stock and (B) the number of shares of Common Stock issuable upon conversion of a share of such Preferred Stock, <u>divided</u> by the number of shares of Common Stock issuable upon conversion of a share of such class or series of capital stock; or (iii) in the case of a dividend on any class or series that is not convertible into Common Stock, the product of (A) the amount of the dividend payable on each share of such class or series of capital stock <u>divided</u> by the original issuance price of such class or series of capital stock (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to such class or series) and (B) the applicable Original Issue Price (as defined below); <u>provided</u> that, if the Corporation declares, pays or sets aside, on the same date, a dividend on shares of more than one class or series of capital stock of the Corporation, the dividend payable to the holders of Preferred Stock pursuant to this <u>Section</u> <u>1</u> shall be calculated based upon the dividend on the class or series of capital stock that would result in the highest Preferred Stock dividend

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for the applicable series of Preferred Stock. The "**Original Issue Price**" shall mean, with respect to the Series A Preferred Stock, $19.4228 per share, with respect to the Series B Preferred Stock, $21.36508 per share and with respect to the Series B-1 Preferred Stock, $21.36508 per share, in each case subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the applicable Preferred Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Liquidation, Dissolution or Winding Up; Certain Mergers, Consolidations and Asset Sales.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Preferential Payments to Holders of Preferred Stock</u>. In the event of (a) any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the holders of shares of each series of Preferred Stock then outstanding shall be entitled to be paid out of the assets of the Corporation available for distribution to its stockholders, and (b) a Deemed Liquidation Event (as defined below), the holders of shares of each series of Preferred Stock then outstanding shall be entitled to be paid out of the consideration payable to stockholders in such Deemed Liquidation Event or out of the Available Proceeds (as defined below), as applicable, on a *pari passu* basis based on their respective Liquidation Amounts (as defined below) and before any payment shall be made to the holders of Common Stock by reason of their ownership thereof, an amount per share of each such series of Preferred Stock equal to the greater of (i) the applicable Original Issue Price, plus any dividends declared but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of such series of Preferred Stock (and all shares of all other series of Preferred Stock that would receive a larger distribution per share if such series of Preferred Stock were converted into Common Stock) been converted into Common Stock pursuant to <u>Section</u> <u>4</u> immediately prior to such liquidation, dissolution, winding up or Deemed Liquidation Event (the amount payable pursuant to this sentence is hereinafter referred to, for each series of Preferred Stock, as applicable, as the "**Liquidation Amount**"). If upon any such liquidation, dissolution or winding up of the Corporation or Deemed Liquidation Event, the assets of the Corporation available for distribution to its stockholders shall be insufficient to pay the holders of shares of Preferred Stock the full amount to which they shall be entitled under this <u>Section</u> <u>2.1</u>, the holders of shares of Preferred Stock shall share ratably in any distribution of the assets available for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Payments to Holders of Common Stock</u>. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, after the payment in full of all Liquidation Amounts required to be paid to the holders of shares of Preferred Stock, the remaining assets of the Corporation available for distribution to its stockholders or, in the case of a Deemed Liquidation Event, the consideration not payable to the holders of shares of Preferred Stock pursuant to <u>Section</u> <u>2.1</u> or the remaining Available Proceeds, as the case may be, shall be distributed among the holders of shares of Common Stock, pro rata based on the number of shares of Common Stock held by each such holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Deemed Liquidation Events</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.1 <u>Definition</u>. Each of the following events shall be considered a "**Deemed Liquidation Event**" unless the holders of a majority of the outstanding shares of Preferred Stock, voting together as a single class on an as-converted to Common Stock basis (the "**Requisite Holders**"), elect otherwise by written notice sent to the Corporation at least 10 days prior to the effective date of any such event:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a merger, consolidation, statutory conversion, transfer, domestication, or continuance in which

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Corporation is a constituent party or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a subsidiary of the Corporation is a constituent party and the Corporation issues shares of its capital stock
pursuant to such merger, consolidation, statutory conversion, transfer, domestication or continuance,

except any such merger, consolidation, statutory conversion, transfer, domestication, or continuance involving the Corporation or a subsidiary in which the shares of capital stock of the Corporation outstanding immediately prior to such merger, consolidation, statutory conversion, transfer, domestication, or continuance continue to represent, or are converted into or exchanged for shares of capital stock or other equity interests that represent, immediately following such merger, consolidation, statutory conversion, transfer, domestication, or continuance, a majority, by voting power, of the capital stock or other equity interests of (1) the surviving or resulting corporation or entity; or (2) if the surviving or resulting corporation or entity is a wholly owned subsidiary of another corporation or entity immediately following such merger, consolidation, statutory conversion, transfer, domestication, or continuance, the parent corporation or entity of such surviving or resulting corporation or entity; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (i) the sale, lease, transfer, exclusive license or other disposition, in a single transaction or series of related transactions, by the Corporation or any subsidiary of the Corporation of all or substantially all the assets of the Corporation and its subsidiaries taken as a whole or (ii) the sale, lease, transfer, exclusive license or other disposition (whether by merger, consolidation, statutory conversion, domestication, continuance or otherwise, and whether in a single transaction or a series of related transactions) of one or more subsidiaries of the Corporation if substantially all of the assets of the Corporation and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries, except where such sale, lease, transfer, exclusive license or other disposition is to a wholly owned subsidiary of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2 <u>Effecting a Deemed Liquidation Event</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Corporation shall not have the power to effect a Deemed Liquidation Event referred to in <u>Section</u> <u>2.3.1(a)(i)</u> unless the agreement or plan with respect to such transaction, or terms of such transaction (any such agreement, plan or terms, the "**Transaction Document**"), provide that the consideration payable to the stockholders of the Corporation in such Deemed Liquidation Event shall be allocated to the holders of capital stock of the Corporation in accordance with <u>Sections 2.1</u> and <u>2.2</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of a Deemed Liquidation Event referred to in <u>Section</u> <u>2.3.1(a)(ii)</u> or <u>2.3.1(b)</u>, if the Corporation does not effect a dissolution of the Corporation under the General Corporation Law within 90 days after such Deemed Liquidation Event, then (i) the Corporation shall send a written notice to each holder of Preferred Stock no later than the 90th day after the Deemed Liquidation Event advising such holders of their right (and the requirements to be met to secure such right) pursuant to the terms of the following clause (ii) to require the redemption of such shares of Preferred Stock, and (ii) if the Requisite Holders so request in a written instrument delivered to the Corporation not later than 120 days after such Deemed Liquidation Event, the Corporation shall use the consideration received by the Corporation for such Deemed Liquidation Event (net of any retained liabilities associated with the assets sold or technology licensed, any other expenses reasonably related to such Deemed Liquidation Event or any other expenses incident to the dissolution of the Corporation as provided herein, in each case as determined in good faith by the Board of Directors), together with any other assets of the Corporation available for distribution to its stockholders, all to the extent permitted by Delaware law governing

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distributions to stockholders (the "**Available Proceeds**") on the 150th day after such Deemed Liquidation Event (the "**DLE Redemption Date**"), to redeem all outstanding shares of Preferred Stock at a price per share equal to the applicable Liquidation Amount; <u>provided</u>, that if the definitive agreements governing such Deemed Liquidation Event contain contingent indemnification obligations on the part of the Corporation and prohibit the Corporation from distributing all or a portion of the Available Proceeds while such indemnification obligations remain outstanding, then the DLE Redemption Date shall automatically be extended to the date that is ten business days following the date on which such prohibition expires. Notwithstanding the foregoing, in the event of a redemption pursuant to the preceding sentence, if the Available Proceeds are not sufficient to redeem all outstanding shares of Preferred Stock, the Corporation shall redeem a pro rata portion of each holder's shares of Preferred Stock to the fullest extent of such Available Proceeds, based on the respective amounts which would otherwise be payable in respect of the shares to be redeemed if the Available Proceeds were sufficient to redeem all such shares, and shall redeem the remaining shares as soon as it may lawfully do so under Delaware law governing distributions to stockholders. Prior to the distribution or redemption provided for in this <u>Section</u> <u>2.3.2(b)</u>, the Corporation shall not expend or dissipate the Available Proceeds for any purpose, except to discharge expenses incurred in connection with such Deemed Liquidation Event. In connection with a distribution or redemption provided for in <u>Section</u> <u>2.3.2</u>, the Corporation shall send written notice of the redemption (the "**Redemption Notice**") to each holder of record of Preferred Stock. Each Redemption Notice shall state:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the number of shares of Preferred Stock held by the holder that the Corporation shall redeem on the date
specified in the Redemption Notice;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the redemption date and the price per share at which the shares of Preferred Stock are being redeemed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) for holders of shares in certificated form, that the holder is to surrender to the Corporation, in the manner
and at the place designated, his, her or its certificate or certificates representing the shares of Preferred Stock to be redeemed.

If the Redemption Notice shall have been duly given, and if payment is tendered or deposited with an independent payment agent so as to be available therefor in a timely manner, then notwithstanding that any certificates evidencing any of the shares of Preferred Stock so called for redemption shall not have been surrendered, all rights with respect to such shares shall forthwith after the date terminate, except only the right of the holders to receive the payment without interest upon surrender of any such certificate or certificates therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.3 <u>Amount Deemed Paid or Distributed</u>. The amount deemed paid or distributed to the holders of capital stock of the Corporation upon any such merger, consolidation, sale, transfer, exclusive license, other disposition or redemption shall be the cash or the value of the property, rights or securities to be paid or distributed to such holders pursuant to such Deemed Liquidation Event. The value of such property, rights or securities shall be determined in good faith by the Requisite Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.4 <u>Allocation of Escrow and Contingent Consideration</u>. In the event of a Deemed Liquidation Event pursuant to <u>Section</u> <u>2.3.1(a)(i)</u>, if any portion of the consideration payable to the stockholders of the Corporation is payable only upon satisfaction of contingencies (the "**Additional Consideration**"), the Transaction Document shall provide that (a) the portion of such consideration that is not Additional Consideration (such portion, the "**Initial Consideration**") shall be allocated among the

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holders of capital stock of the Corporation in accordance with <u>Sections 2.1</u> and <u>2.2</u> as if the Initial Consideration were the only consideration payable in connection with such Deemed Liquidation Event; and (b) any Additional Consideration which becomes payable to the stockholders of the Corporation upon satisfaction of such contingencies shall be allocated among the holders of capital stock of the Corporation in accordance with <u>Sections 2.1</u> and <u>2.2</u> after taking into account the previous payment of the Initial Consideration as part of the same transaction. For the purposes of this <u>Section</u> <u>2.3.4</u>, consideration placed into escrow or retained as a holdback to be available for satisfaction of indemnification or similar obligations in connection with such Deemed Liquidation Event shall be deemed to be Additional Consideration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Voting</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>General</u>. On any matter presented to the stockholders of the Corporation for their action or consideration at any meeting of stockholders of the Corporation (or by written consent of stockholders in lieu of a meeting), each holder of outstanding shares of Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Preferred Stock held by such holder are convertible (as provided in <u>Section</u> <u>4</u> below) as of the record date for determining stockholders entitled to vote on such matter. Except as provided by law or by the other provisions of this Certificate of Incorporation, holders of Preferred Stock shall vote together with the holders of Common Stock as a single class and on an as-converted to Common Stock basis; provided, that the holders of Series B-1 Preferred Stock shall not be entitled to vote on the election of directors of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Election of Directors</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At all times when at least 1,353,432 shares of Voting Preferred Stock remain outstanding (subject to appropriate adjustment in the event of any stock dividend, stock split, combination, or other similar recapitalization with respect to the Voting Preferred Stock), (i) the holders of record of the shares of Voting Preferred Stock, exclusively and voting together as a separate class on an as-converted to Common Stock basis, shall be entitled to elect two directors of the Corporation (the "**Preferred Directors**"); (ii) the holders of record of the shares of Common Stock, exclusively and voting together as a separate class, shall be entitled to elect two directors of the Corporation; and (iii) the holders of record of the shares of Common Stock and of any other class or series of voting stock (other than the Series B-1 Preferred Stock), exclusively and voting together as a single class on an as-converted to Common Stock basis, shall be entitled to elect the balance of the total number of directors of the Corporation (the "**At-Large Directors**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any director elected as provided in <u>Section</u> <u>3.2(a)(i)</u> or <u>Section</u> <u>3.2(a)(ii)</u> or appointed by the proviso of <u>Section</u> <u>3.2(a)</u> may be removed without cause by, and only by, the affirmative vote of the holders of a majority of the shares of the class or series of capital stock entitled to elect such director or directors, given either at a special meeting of such stockholders duly called for that purpose or pursuant to a written consent of stockholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the holders of shares of Voting Preferred Stock or Common Stock, as the case may be, fail to elect a
sufficient number of directors to fill all directorships for which they are entitled to elect directors pursuant to <u>Section</u> <u>3.2(a)</u> (and to the extent any of such directorships is not otherwise

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filled by a director appointed in accordance with the proviso in <u>Section</u> <u>3.2(a)</u>), then any directorship not so filled shall remain vacant until such time as the holders of the Voting Preferred Stock or Common Stock, as the case may be, fill such directorship in accordance with <u>Section</u> <u>3.2(a)</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) A vacancy in any At-Large Director seat can be filled by either
(A) the vote or written consent in lieu of a meeting of the stockholders entitled to elect the At-Large Directors, or (B) the vote or written consent in lieu of a meeting of all remaining
director(s).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) At any meeting held for the purpose of electing a director, the presence in person or by proxy of the holders of a majority of the outstanding shares of the class or series of capital stock entitled to elect such director shall constitute a quorum for the purpose of electing such director.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The "**Requisite Directors**" shall mean approval by the Board of Directors including the approval of each of the Preferred Directors then seated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 <u>Preferred Stock Protective Provisions</u>. At any time when at least 13,495,968 shares of Preferred Stock (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Preferred Stock) are outstanding, the Corporation shall not, either directly or indirectly by amendment, merger, consolidation, domestication, transfer, continuance, recapitalization, reclassification, waiver, statutory conversion, or otherwise, effect any of the following acts or transactions without (in addition to any other vote required by law or this Certificate of Incorporation) the written consent or affirmative vote of the Requisite Holders, and any such act or transaction that has not been approved by such consent or vote prior to such act or transaction being effected shall be null and void *ab initio*, and of no force or effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.1 liquidate, dissolve or wind-up the business and affairs of the Corporation or effect any Deemed Liquidation Event or any other merger, consolidation, statutory conversion, transfer, domestication or continuance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.2 amend, alter or repeal any provision of this Certificate of Incorporation or Bylaws of the Corporation; 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.3 create or issue or obligate itself to issue shares of, or reclassify, any capital stock unless the same ranks junior to the Preferred Stock with respect to its special rights, powers and preferences;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.4 increase the authorized number of shares of Common Stock, Preferred Stock, or any additional class or series of capital stock of the Corporation unless the same ranks junior to the Preferred Stock with respect to its special rights, powers and preferences;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.5 purchase or redeem (or permit any subsidiary to purchase or redeem) or pay or declare any dividend or make any distribution on, any shares of capital stock of the Corporation other than (i) redemptions of or dividends or distributions on the Preferred Stock as expressly authorized herein, (ii) dividends or other distributions payable on the Common Stock solely in the form of additional shares of Common Stock, and (iii) repurchases of stock from former employees, officers, directors, consultants or other persons who performed services for the Corporation or any subsidiary in connection with the cessation of such employment or service at no greater than the original purchase price thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.6 (i) create or adopt, any equity (or equity-linked) compensation plan; (ii) amend any such plan to increase the number of shares authorized for issuance thereunder; or (iii) amend or waive any of the terms of any option or other grant pursuant to any such plan;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.7 unless (i) the aggregate indebtedness of the Corporation and its subsidiaries for borrowed money following such action would not exceed $10,000,000 or (ii) approved by the Requisite Directors, create, or issue, any debt security, create any lien or security interest (except for purchase money liens or statutory liens of landlords, mechanics, materialmen, workmen, warehousemen and other similar persons arising or incurred in the ordinary course of business), or incur other indebtedness for borrowed money, including but not limited to obligations and contingent obligations under guarantees, or permit any subsidiary to take any such action with respect to any debt security lien, security interest or other indebtedness for borrowed money, in each case, other than equipment leases, bank lines of credit or trade payables incurred in the ordinary course of business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.8 create, or hold capital stock in, any subsidiary that is not wholly owned (either directly or through one or more other subsidiaries) by the Corporation, or permit any subsidiary to create, or issue or obligate itself to issue, any shares of any class or series of capital stock, or sell, transfer or otherwise dispose of any capital stock of any direct or indirect subsidiary of the Corporation, or permit any direct or indirect subsidiary to sell, lease, transfer, exclusively license or otherwise dispose (in a single transaction or series of related transactions) of all or substantially all of the assets of such subsidiary;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.9 increase or decrease the authorized number of directors constituting the Board of Directors, change the number of votes entitled to be cast by any director or directors on any matter, or adopt any provision inconsistent with <u>Article Sixth</u>; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3.10 unless otherwise approved by the Requisite Directors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) sell, assign, license, pledge, or encumber material technology or intellectual property, other than in connection with ordinary course product sales or licenses; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) enter into any corporate strategic relationship involving the payment, contribution, or assignment by the Corporation of money or assets having a value (as determined by the Board of Directors in a matter consistent with the agreements governing such relationship) greater than $10,000,000.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 <u>Nonvoting Series B-1 Preferred Stock Protective Provisions</u>. At any time when any shares of Series B-1 Preferred Stock are outstanding, the Corporation shall not, either directly or indirectly by amendment, merger, consolidation, domestication, transfer, continuance, recapitalization, reclassification, waiver, statutory conversion, or otherwise, effect any of the following acts or transactions without (in addition to any other vote required by law or this Certificate of Incorporation) the written consent or affirmative vote of the Requisite Holders, and any such act or transaction that has not been approved by such consent or vote prior to such act or transaction being effected shall be null and void *ab initio*, and of no force or effect.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.1 amend, alter or repeal any provision of this Certificate of Incorporation or Bylaws of the Corporation in a manner that disproportionately and adversely affects the special rights, powers and preferences of the Series B-1 Preferred Stock relative to the Series B Preferred Stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.2 effect any Deemed Liquidation Event or any other merger, consolidation, statutory conversion, transfer, domestication or continuance pursuant to which the holders of the Series B-1 Preferred Stock immediately prior to such transaction are (i) issued securities with different special rights, powers and preferences than the securities issued to the holders of the Series B Preferred Stock in such transaction and (ii) such securities have special rights, powers and preferences that are materially less favorable than the special rights, powers and preferences of such Series B-1 Preferred Stock immediately prior to such transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.3 create any capital stock that ranks senior to the Series B-1 Preferred Stock with respect to its special rights, powers and preferences unless the same also ranks senior to the Series B Preferred Stock with respect to its special rights, powers and preferences; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4.4 increase or decrease the authorized number of shares of Series B-1 Preferred Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Optional Conversion</u>. The holders of the Preferred Stock shall have conversion rights as follows (the "**Conversion Rights**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Right to Convert</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1 <u>Conversion Ratio</u>. Each share of Preferred Stock shall be convertible, at the option of the holder thereof, at any time, and without the payment of additional consideration by the holder thereof, into such whole number of fully paid and non-assessable shares of Common Stock (calculated as provided in <u>Section</u> <u>4.2</u> below), as is determined by dividing the applicable Original Issue Price by the applicable Conversion Price (as defined below) in effect at the time of conversion. The "**Conversion Price**" shall be equal to $19.4228 per share of Series A Preferred Stock, $21.36508 per share of Series B Preferred Stock and $21.36508 per share of Series B-1 Preferred Stock. Such initial Conversion Price for a series of Preferred Stock, and the rate at which shares of Preferred Stock may be converted into shares of Common Stock, shall be subject to adjustment as provided in this <u>Section</u> <u>4</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.2 <u>Termination of Conversion Rights</u>. In the event of a notice of redemption of any shares of Preferred Stock pursuant to <u>Section</u> <u>2.3.2(b)</u>, the Conversion Rights of the shares designated for redemption shall terminate at the close of business on the last full day preceding the date fixed for redemption, unless the redemption price is not fully paid on such redemption date, in which case the Conversion Rights for such shares shall continue until such price is paid in full. In the event of a liquidation, dissolution or winding up of the Corporation or a Deemed Liquidation Event, the Conversion Rights shall terminate at the close of business on the last full day preceding the date fixed for the payment of any such amounts distributable on such event to the holders of Preferred Stock; provided that the foregoing termination of Conversion Rights shall not affect the amount(s) otherwise paid or payable in accordance with Section 2.1 to the holders of Preferred Stock pursuant to such liquidation, dissolution or winding up of the Corporation or a Deemed Liquidation Event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Number of Shares Issuable Upon Conversion</u>. The number of shares of Common Stock issuable to a holder of Preferred Stock upon conversion of such Preferred Stock shall be the nearest whole share, after aggregating all fractional interests in shares of Common Stock that would otherwise be issuable upon conversion of all shares of that same series of Preferred Stock being converted by such holder (with any fractional interests after such aggregation representing 0.5 or greater of a whole share being entitled to a whole share). For the avoidance of doubt, no fractional interests in shares of Common Stock shall be created or issuable as a result of the conversion of the Preferred Stock pursuant to <u>Section</u> <u>4.1.1</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Mechanics of Conversion</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.1 <u>Notice of Conversion</u>. In order for a holder of Preferred Stock to voluntarily convert shares of Preferred Stock into shares of Common Stock, such holder shall (a) provide written notice to the Corporation's transfer agent at the office of the transfer agent for the Preferred Stock (or at the principal office of the Corporation if the Corporation serves as its own transfer agent) that such holder elects to convert all or any number of such holder's shares of Preferred Stock and, if applicable, any event on which such conversion is contingent and (b), if such holder's shares are certificated, surrender the certificate or certificates for such shares of Preferred Stock (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate), at the office of the transfer agent for the Preferred Stock (or at the principal office of the Corporation if the Corporation serves as its own transfer agent). Such notice shall state such holder's name or the names of the nominees in which such holder wishes the shares of Common Stock to be issued. If required by the Corporation, any certificates surrendered for conversion shall be endorsed or accompanied by a written instrument or instruments of transfer, in form satisfactory to the Corporation, duly executed by the registered holder or his, her or its attorney duly authorized in writing. Unless a later time and date is otherwise specified by the Corporation, the close of business on the date of receipt by the transfer agent (or by the Corporation if the Corporation serves as its own transfer agent) of such notice and, if applicable, certificates (or lost certificate affidavit and agreement) shall be the time of conversion (the "**Conversion Time**"), and the shares of Common Stock issuable upon conversion of the specified shares shall be deemed to be outstanding of record as of such date. The Corporation shall, as soon as practicable after the Conversion Time (i) issue and deliver to such holder of Preferred Stock, or to his, her or its nominees, a certificate or certificates (or book-entry accounts) for the number of full shares of Common Stock issuable upon such conversion in accordance with the provisions hereof and a certificate for the number (if any) of the shares of Preferred Stock represented by the surrendered certificate that were not converted into Common Stock, and (ii) pay all declared but unpaid dividends on the shares of Preferred Stock converted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.2 <u>Reservation of Shares</u>. The Corporation shall at all times when the Preferred Stock shall be outstanding, reserve and keep available out of its authorized but unissued capital stock, for the purpose of effecting the conversion of the Preferred Stock, such number of its duly authorized shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding Preferred Stock; and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Preferred Stock, the Corporation shall take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to this Certificate of Incorporation. Before taking any action that would cause an adjustment reducing the Conversion Price for any series of Preferred Stock below the then par value of the shares of Common Stock issuable upon conversion of such series of Preferred Stock, the Corporation will take any corporate action which may, in the opinion of its counsel, be necessary in order that the Corporation may validly and legally issue fully paid and non-assessable shares of Common Stock at such adjusted Conversion Price.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.3 <u>Effect of Conversion</u>. All shares of Preferred Stock which shall have been surrendered for conversion as herein provided shall no longer be deemed to be outstanding and all rights with respect to such shares shall immediately cease and terminate at the Conversion Time, except only the right of the holders thereof to receive shares of Common Stock in exchange therefor and to receive payment of any dividends declared but unpaid thereon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.4 <u>No Further Adjustment</u>. Upon any such conversion, no adjustment to the Conversion Price shall be made for any declared but unpaid dividends on the Preferred Stock surrendered for conversion or on the Common Stock delivered upon conversion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.5 <u>Taxes</u>. The Corporation shall pay any and all issue and other similar taxes that may be payable in respect of any issuance or delivery of shares of Common Stock upon conversion of shares of Preferred Stock pursuant to this <u>Section</u> <u>4</u>. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of shares of Common Stock in a name other than that in which the shares of Preferred Stock so converted were registered, and no such issuance or delivery shall be made unless and until the person or entity requesting such issuance has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>Adjustments to</u> <u>Preferred Stock Conversion</u> <u>Price for Diluting Issues</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.1 <u>Special Definitions</u>. For purposes of this Article Fourth, the following definitions shall apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "**Additional Shares of Common Stock**" means all shares of Common Stock issued (or, pursuant to <u>Section</u> <u>4.4.3</u> below, deemed to be issued) by the Corporation after the Original Issue Date (as defined below), other than (1) the following shares of Common Stock and (2) shares of Common Stock deemed issued pursuant to the following Options and Convertible Securities (clauses (1) and (2), collectively, "**Exempted Securities**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) as to any series of Preferred Stock, shares of Common Stock, Options or Convertible Securities issued as a
dividend or distribution on such series of Preferred Stock (including dividends payable in connection with dividends on other classes or series of stock);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) shares of Common Stock, Options or Convertible Securities issued by reason of a dividend, stock split, split-up or other distribution on shares of Common Stock that is covered by <u>Section</u> <u>4.5</u>, <u>4.6</u>, <u>4.7</u> or <u>4.8</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) shares of Common Stock, Options or Convertible Securities issued to banks, equipment lessors or other financial
institutions, or to real property lessors, pursuant to a debt financing, equipment leasing or real property leasing transaction approved by the Requisite Directors;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) shares of Common Stock or Options issued to employees or directors of, or consultants or advisors to, the
Corporation or any of its subsidiaries pursuant to a plan, agreement or arrangement approved (i) prior to the Original Issue Date or (ii) by the Requisite Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) shares of Common Stock or Convertible Securities actually issued upon the exercise of Options or shares of
Common Stock actually issued upon the conversion or exchange of Convertible Securities, in each case provided such issuance is pursuant to the terms of such Option or Convertible Security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) shares of Common Stock, Options or Convertible Securities issued to suppliers or third party service providers
in connection with the provision of goods or services pursuant to transactions approved by the Requisite Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) shares of Common Stock, Options or Convertible Securities issued as acquisition consideration pursuant to the
acquisition of another corporation by the Corporation by merger, purchase of substantially all of the assets, license or other reorganization or to a joint venture agreement or other similar strategic transaction; provided that such issuances are
approved by the Requisite Directors; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) shares of Common Stock, Options or Convertible Securities issued in connection with sponsored research,
collaboration, technology license, development, OEM, marketing or other similar agreements or strategic partnerships approved by the Requisite Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "**Convertible Securities**" means any evidences of indebtedness, shares or other securities directly or indirectly convertible into or exchangeable for Common Stock, but excluding Options.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "**Option**" means any rights, options or warrants to subscribe for, purchase or otherwise acquire Common Stock or Convertible Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) "**Original Issue Date**" means the date on which the first share of Series B Preferred Stock is issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.2 <u>No Adjustment of Preferred Stock</u>**<u> </u>**<u>Conversion Price</u>. No adjustment in the Conversion Price of any series of Preferred Stock shall be made as the result of the issuance or deemed issuance of Additional Shares of Common Stock if the Corporation receives written notice from the Requisite Holders, agreeing that no such adjustment shall be made as the result of the issuance or deemed issuance of such Additional Shares of Common Stock.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.3 <u>Deemed Issue of Additional Shares of Common Stock</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If the Corporation at any time or from time to time after the Original Issue Date shall issue any Options or Convertible Securities (excluding Options or Convertible Securities which are themselves Exempted Securities) or shall fix a record date for the determination of holders of any class of securities entitled to receive any such Options or Convertible Securities, then the maximum number of shares of Common Stock (as set forth in the instrument relating thereto, assuming the satisfaction of any conditions to exercisability, convertibility or exchangeability but without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or, in the case of Convertible Securities and Options therefor, the conversion or exchange of such Convertible Securities, shall be deemed to be Additional Shares of Common Stock issued as of the time of such issue or, in case such a record date shall have been fixed, as of the close of business on such record date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If the terms of any Option or Convertible Security, the issuance of which resulted in an adjustment to the Conversion Price of any series of Preferred Stock pursuant to the terms of <u>Section</u> <u>4.4.4</u>, are revised as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security (but excluding automatic adjustments to such terms pursuant to anti-dilution or similar provisions of such Option or Convertible Security) to provide for either (1) any increase or decrease in the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any such Option or Convertible Security or (2) any increase or decrease in the consideration payable to the Corporation upon such exercise, conversion and/or exchange, then, effective upon such increase or decrease becoming effective, the Conversion Price of such series of Preferred Stock computed upon the original issue of such Option or Convertible Security (or upon the occurrence of a record date with respect thereto) shall be readjusted to such Conversion Price for such series of Preferred Stock as would have obtained had such revised terms been in effect upon the original date of issuance of such Option or Convertible Security. Notwithstanding the foregoing, no readjustment pursuant to this <u>Section</u> <u>4.4.3(b)</u> shall have the effect of increasing the Conversion Price applicable to a series of Preferred Stock to an amount which exceeds the lower of (i) the Conversion Price for such series of Preferred Stock in effect immediately prior to the original adjustment made as a result of the issuance of such Option or Convertible Security, or (ii) the Conversion Price for such series of Preferred Stock that would have resulted from any issuances of Additional Shares of Common Stock (other than deemed issuances of Additional Shares of Common Stock as a result of the issuance of such Option or Convertible Security) between the original adjustment date and such readjustment date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If the terms of any Option or Convertible Security (excluding Options or Convertible Securities which are themselves Exempted Securities), the issuance of which did not result in an adjustment to the Conversion Price of a series of Preferred Stock pursuant to the terms of <u>Section</u> <u>4.4.4</u> (either because the consideration per share (determined pursuant to <u>Section</u> <u>4.4.5</u>) of the Additional Shares of Common Stock subject thereto was equal to or greater than the Conversion Price then in effect, or because such Option or Convertible Security was issued before the Original Issue Date), are revised after the Original Issue Date as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security (but excluding automatic adjustments to such terms pursuant to anti-dilution or similar provisions of such Option or Convertible Security) to provide for either (1) any increase in the number of shares of Common Stock issuable upon the exercise, conversion or exchange of any such Option or Convertible Security or (2) any decrease in the consideration payable to the Corporation upon such exercise, conversion or exchange, then such Option or Convertible Security, as so amended or adjusted, and the Additional Shares of Common Stock subject thereto determined in the manner provided in <u>Section</u> <u>4.4.3(a)</u> shall be deemed to have been issued effective upon such increase or decrease becoming effective.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Upon the expiration or termination of any unexercised Option or unconverted or unexchanged Convertible Security (or portion thereof) which resulted (either upon its original issuance or upon a revision of its terms) in an adjustment to the Conversion Price of any series of Preferred Stock pursuant to the terms of <u>Section</u> <u>4.4.4</u>, the Conversion Price of such series of Preferred Stock shall be readjusted to such Conversion Price for such series of Preferred Stock as would have obtained had such Option or Convertible Security (or portion thereof) never been issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) If the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any Option or Convertible Security, or the consideration payable to the Corporation upon such exercise, conversion and/or exchange, is calculable at the time such Option or Convertible Security is issued or amended but is potentially subject to adjustment based upon subsequent events, any adjustment to the Conversion Price of a series of Preferred Stock provided for in this <u>Section</u> <u>4.4.3</u> shall be effected at the time of such issuance or amendment based on such number of shares or amount of consideration without regard to any provisions for subsequent adjustments (and any subsequent adjustments shall be treated as provided in <u>clauses (b)</u> and <u>(c)</u> of this <u>Section</u> <u>4.4.3</u>). If the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of any Option or Convertible Security, or the consideration payable to the Corporation upon such exercise, conversion and/or exchange, cannot be calculated at all at the time such Option or Convertible Security is issued or amended, any adjustment to the Conversion Price of a series of Preferred Stock that would result under the terms of this <u>Section</u> <u>4.4.3</u> at the time of such issuance or amendment shall instead be effected at the time such number of shares and/or amount of consideration is first calculable (even if subject to subsequent adjustments), assuming for purposes of calculating such adjustment to the Conversion Price for such series of Preferred Stock that such issuance or amendment took place at the time such calculation can first be made. In the event an Option or Convertible Security contains alternative conversion terms, such as a cap on the valuation of the Corporation at which such conversion will be effected, or circumstances where the Option or Convertible Security may be repaid in lieu of conversion, then the number of shares of Common Stock issuable upon the exercise, conversion and/or exchange of such Option or Convertible Security shall be deemed not calculable until such time as the applicable conversion terms are determined.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.4 <u>Adjustment of Conversion Price Upon Issuance of Additional Shares of Common Stock</u>. In the event the Corporation shall at any time after the Original Issue Date issue Additional Shares of Common Stock (including Additional Shares of Common Stock deemed to be issued pursuant to <u>Section</u> <u>4.4.3</u>), without consideration or for a consideration per share less than the Conversion Price of a series of Preferred Stock in effect immediately prior to such issuance or deemed issuance, then the Conversion Price for such series of Preferred Stock shall be reduced, concurrently with such issue, to a price (calculated to the nearest one-hundredth of a cent) determined in accordance with the following formula:

CP<sub>2</sub> = CP<sub>1</sub>\* (A + B) / (A + C).

For purposes of the foregoing formula, the following definitions shall apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "CP<sub>2</sub>" shall mean the Conversion Price of such series of Preferred Stock in effect immediately after such issuance or deemed issuance of Additional Shares of Common Stock;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "CP<sub>1</sub>" shall mean the Conversion Price of such series of Preferred Stock in effect immediately prior to such issuance or deemed issuance of Additional Shares of Common Stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "A" shall mean the number of shares of Common Stock outstanding immediately prior to such issuance or deemed issuance of Additional Shares of Common Stock (treating for this purpose as outstanding all shares of Common Stock issuable upon exercise of Options outstanding immediately prior to such issuance or deemed issuance or upon conversion or exchange of Convertible Securities (including the Preferred Stock) outstanding (assuming exercise of any outstanding Options therefor) immediately prior to such issue);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) "B" shall mean the number of shares of Common Stock that would have been issued if such Additional Shares of Common Stock had been issued or deemed issued at a price per share equal to CP<sub>1</sub> (determined by dividing the aggregate consideration received by the Corporation in respect of such issue by CP<sub>1</sub>); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) "C" shall mean the number of such Additional Shares of Common Stock issued in such transaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.5 <u>Determination of Consideration</u>. For purposes of this <u>Section</u> <u>4.4</u>, the consideration received by the Corporation for the issuance or deemed issuance of any Additional Shares of Common Stock shall be computed as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Cash and Property</u>. Such consideration shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) insofar as it consists of cash, be computed at the aggregate amount of cash received by the Corporation,
excluding amounts paid or payable for accrued interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) insofar as it consists of property other than cash, be computed at the fair market value thereof at the time of
such issue, as determined in good faith by the Board of Directors; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) in the event Additional Shares of Common Stock are issued together with other shares or securities or other
assets of the Corporation for consideration which covers both, be the proportion of such consideration so received, computed as provided in <u>clauses (i)</u> and <u>(ii)</u> above, as determined in good faith by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Options and Convertible Securities</u>. The consideration per share received by the Corporation for Additional Shares of Common Stock deemed to have been issued pursuant to <u>Section</u> <u>4.4.3</u>, relating to Options and Convertible Securities, shall be determined by dividing:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The total amount, if any, received or receivable by the Corporation as consideration for the issue of such
Options or Convertible Securities, plus the minimum aggregate amount of additional consideration (as set forth in the instruments relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration)
payable to the Corporation upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the exercise of such Options for Convertible Securities and the
conversion or exchange of such Convertible Securities, by

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the maximum number of shares of Common Stock (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment of such number) issuable upon the exercise of such Options or the conversion or exchange of such Convertible Securities, or in the case of Options for Convertible Securities, the
exercise of such Options for Convertible Securities and the conversion or exchange of such Convertible Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.6 <u>Multiple Closing Dates</u>. In the event the Corporation shall issue on more than one date Additional Shares of Common Stock that are a part of one transaction or a series of related transactions and that would result in an adjustment to the Conversion Price of a series of Preferred Stock pursuant to the terms of <u>Section</u> <u>4.4.4</u>, and such issuance dates occur within a period of no more than 180 days from the first such issuance to the final such issuance, then, upon the final such issuance, the Conversion Price for such series of Preferred Stock shall be readjusted to give effect to all such issuances as if they occurred on the date of the first such issuance (and without giving effect to any additional adjustments as a result of any such subsequent issuances within such period).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>Adjustment for Stock Splits and Combinations</u>. If the Corporation shall at any time or from time to time after the Original Issue Date effect a subdivision of the outstanding Common Stock, the Conversion Price of each series of Preferred Stock in effect immediately before that subdivision shall be proportionately decreased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be increased in proportion to such increase in the aggregate number of shares of Common Stock outstanding. If the Corporation shall at any time or from time to time after the Original Issue Date combine the outstanding shares of Common Stock, the Conversion Price of each series of Preferred Stock in effect immediately before the combination shall be proportionately increased so that the number of shares of Common Stock issuable on conversion of each share of such series shall be decreased in proportion to such decrease in the aggregate number of shares of Common Stock outstanding. Any adjustment under this <u>Section</u> <u>4.5</u> shall become effective at the close of business on the date the subdivision or combination becomes effective.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 <u>Adjustment for Certain Dividends and Distributions</u>. In the event the Corporation at any time or from time to time after the Original Issue Date shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or other distribution payable on the Common Stock in additional shares of Common Stock, then and in each such event the Conversion Price of each series of Preferred Stock in effect immediately before such event shall be decreased as of the time of such issuance or, in the event such a record date shall have been fixed, as of the close of business on such record date, by multiplying the Conversion Price of each such series of Preferred Stock then in effect by a fraction:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) the numerator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) the denominator of which shall be the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such dividend or distribution.

Notwithstanding the foregoing, (a) if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, the Conversion Price of each series of Preferred Stock shall be recomputed accordingly as of the close of business on such record date and thereafter the Conversion Price of each series of Preferred Stock shall be adjusted pursuant to this <u>Section</u> <u>4.6</u> as of the time of actual payment of such dividends or distributions; and (b) no such adjustment shall be made if the holders of such series of Preferred Stock simultaneously receive a dividend or other distribution of shares of Common Stock in a number equal to the number of shares of Common Stock as they would have received if all outstanding shares of such series of Preferred Stock had been converted into Common Stock on the date of such event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7 <u>Adjustments for Other Dividends and Distributions</u>. In the event the Corporation at any time or from time to time after the Original Issue Date shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or other distribution payable in securities of the Corporation (other than a distribution of shares of Common Stock in respect of outstanding shares of Common Stock) or in other property and the provisions of <u>Section</u> <u>1</u> do not apply to such dividend or distribution, then and in each such event the holders of Preferred Stock shall receive, simultaneously with the distribution to the holders of Common Stock, a dividend or other distribution of such securities or other property in an amount equal to the amount of such securities or other property as they would have received if all outstanding shares of Preferred Stock had been converted into Common Stock on the date of such event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.8 <u>Adjustment for Merger or Reorganization, etc</u>. Subject to the provisions of <u>Section</u> <u>2.3</u>, if there shall occur any reorganization, recapitalization, reclassification, consolidation or merger involving the Corporation in which the Common Stock (but not the Preferred Stock) is converted into or exchanged for securities, cash or other property (other than a transaction covered by <u>Sections 4.4</u>, <u>4.6</u> or <u>4.7</u>), then, following any such reorganization, recapitalization, reclassification, consolidation or merger, each share of Preferred Stock shall thereafter be convertible in lieu of the Common Stock into which it was convertible prior to such event into the kind and amount of securities, cash or other property which a holder of the number of shares of Common Stock of the Corporation issuable upon conversion of one share of such Preferred Stock immediately prior to such reorganization, recapitalization, reclassification, consolidation or merger would have been entitled to receive pursuant to such transaction; and, in such case, appropriate adjustment (as determined in good faith by the Board of Directors) shall be made in the application of the provisions in this <u>Section</u> <u>4</u> with respect to the rights and interests thereafter of the holders of the Preferred Stock, to the end that the provisions set forth in this <u>Section</u> <u>4</u> (including provisions with respect to changes in and other adjustments of the Conversion Price of each series of Preferred Stock) shall thereafter be applicable, as nearly as reasonably may be, in relation to any securities or other property thereafter deliverable upon the conversion of the Preferred Stock.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.9 <u>Certificate as to Adjustments</u>. Upon the occurrence of each adjustment or readjustment of the Conversion Price of a series of Preferred Stock pursuant to this <u>Section</u> <u>4</u>, the Corporation at its expense shall, as promptly as reasonably practicable but in any event not later than ten days thereafter, compute such adjustment or readjustment in accordance with the terms hereof and furnish to each holder of such series of Preferred Stock a certificate setting forth such adjustment or readjustment (including the kind and amount of securities, cash or other property into which such series of Preferred Stock is convertible) and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, as promptly as reasonably practicable after the written request at any time of any holder of Preferred Stock (but in any event not later than 10 days thereafter), furnish or cause to be furnished to such holder a certificate setting forth (i) the Conversion Price then in effect for each series of Preferred Stock held by such holder, and (ii) the number of shares of Common Stock and the amount, if any, of other securities, cash or property which then would be received upon the conversion of each such series of Preferred Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.10 <u>Notice of Record Date</u>. In the event:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Corporation shall take a record of the holders of its Common Stock (or other capital stock or securities at the time issuable upon conversion of the Preferred Stock) for the purpose of entitling or enabling them to receive any dividend or other distribution, or to receive any right to subscribe for or purchase any shares of capital stock of any class or series or any other securities, or to receive any other security; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) of any capital reorganization of the Corporation, any reclassification of the Common Stock of the Corporation, or any Deemed Liquidation Event; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) of the voluntary or involuntary dissolution, liquidation or winding-up of the Corporation,

then, and in each such case, the Corporation will send or cause to be sent to the holders of the Preferred Stock a notice specifying, as the case may be, (i) the record date for such dividend, distribution or right, and the amount and character of such dividend, distribution or right, or (ii) the effective date on which such reorganization, reclassification, consolidation, merger, transfer, dissolution, liquidation or winding-up is proposed to take place, and the time, if any is to be fixed, as of which the holders of record of Common Stock (or such other capital stock or securities at the time issuable upon the conversion of the Preferred Stock) shall be entitled to exchange their shares of Common Stock (or such other capital stock or securities) for securities or other property deliverable upon such reorganization, reclassification, consolidation, merger, transfer, dissolution, liquidation or winding-up, and the amount per share and character of such exchange applicable to the Preferred Stock and the Common Stock. Such notice shall be sent at least 10 days prior to the record date or effective date for the event specified in such notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Mandatory Conversion</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 <u>Trigger Events</u>. All outstanding shares of Preferred Stock shall automatically be converted into shares of Common Stock, at the then effective conversion rate as calculated pursuant to <u>Sections</u> <u>4.1.1</u> and <u>4.2</u>, upon the earliest to occur of (the time of such conversion is referred to herein as the "**Mandatory Conversion Time**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) immediately prior to the closing of the sale of shares of Common Stock to the public in a firm-commitment underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, resulting in at least $125,000,000 of gross proceeds to the Corporation and in connection with such offering the shares of Common Stock are listed for trading on the Nasdaq Stock Market, the New York Stock Exchange or another exchange or marketplace approved by the Requisite Directors (a "**Qualified IPO**"); and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the date and time, or upon the occurrence of an event, specified by vote or written consent of the Requisite Holders. 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 <u>Procedural Requirements</u>. All holders of record of shares of Preferred Stock (or the applicable series thereof) shall be sent written notice of the Mandatory Conversion Time and the place designated for mandatory conversion of all such shares of Preferred Stock pursuant to this <u>Section</u> <u>5</u>. Such notice need not be sent in advance of the occurrence of the Mandatory Conversion Time. Upon receipt of such notice, each holder of shares of Preferred Stock being converted that holds such shares of Preferred Stock in certificated form shall surrender his, her or its certificate or certificates for all such shares (or, if such holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate) to the Corporation at the place designated in such notice. If so required by the Corporation, any certificates surrendered for conversion shall be endorsed or accompanied by written instrument or instruments of transfer, in form satisfactory to the Corporation, duly executed by the registered holder or by his, her or its attorney duly authorized in writing. All rights with respect to the Preferred Stock converted pursuant to <u>Section</u> <u>5.1</u>, including the rights, if any, to receive notices and vote (other than as a holder of Common Stock), will terminate at the Mandatory Conversion Time (notwithstanding the failure of the holder or holders thereof to surrender any certificates at or prior to such time), except only the rights of the holders thereof, upon surrender of any certificate or certificates of such holders (or lost certificate affidavit and agreement) therefor, to receive the items provided for in the next sentence of this <u>Section</u> <u>5.2</u>. As soon as practicable after the Mandatory Conversion Time and, if applicable, the surrender of any certificate or certificates (or lost certificate affidavit and agreement) for Preferred Stock, the Corporation shall (a) issue and deliver to such holder, or to his, her or its nominees, a certificate or certificates for the number of full shares of Common Stock issuable on such conversion in accordance with the provisions hereof or issue and deliver to such holder, or to his, her or its nominees, a notice of issuance of uncertificated shares and may, upon written request, issue and deliver a certificate for the number of full shares of Common Stock issuable upon such conversion in accordance with the provisions hereof; and (b) pay any declared but unpaid dividends on the shares of Preferred Stock converted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Redemption</u>. Other than as set forth in <u>Section</u> <u>2.3.2(b)</u>, the Preferred Stock is not redeemable at the option of the holder or the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Redeemed or Otherwise Acquired Shares</u>. Unless approved by the Board of Directors and the Requisite Holders, any shares of Preferred Stock that are redeemed, converted or otherwise acquired by the Corporation or any of its subsidiaries shall be automatically and immediately cancelled and retired and shall not be reissued, sold or transferred. Neither the Corporation nor any of its subsidiaries may exercise any voting or other rights granted to the holders of Preferred Stock following redemption, conversion or acquisition. The Corporation may thereafter take such appropriate action (without the need for stockholder action) as may be necessary to reduce the authorized number of shares of Preferred Stock accordingly.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Waiver</u>. Except as otherwise set forth herein, (a) any of the rights, powers, preferences and other terms of the Preferred Stock set forth herein may be waived on behalf of all holders of Preferred Stock by the affirmative written consent or vote of the holders that would otherwise be required to amend such right, powers, preferences, and other terms and (b) at any time more than one series of Preferred Stock is issued and outstanding, any of the rights, powers, preferences and other terms of any series of Preferred Stock set forth herein may be waived on behalf of all holders of such series of Preferred Stock by the affirmative written consent or vote of the holders of such series that would otherwise be required to amend such right, power, preference, or other term.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Notices</u>. Any notice required or permitted by the provisions of this <u>Article Fourth</u> to be given to a holder of shares of Preferred Stock shall be mailed, postage prepaid, to the post office address last shown on the records of the Corporation, or given by electronic transmission in compliance with the provisions of the General Corporation Law, and shall be deemed sent upon such mailing or electronic transmission.

**FIFTH**: Subject to any additional vote required by this Certificate of Incorporation or the Bylaws of the Corporation, in furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to make, repeal, alter, amend and rescind any or all of the Bylaws of the Corporation.

**SIXTH**: Subject to any additional vote required by this Certificate of Incorporation, the number of directors of the Corporation shall be determined in the manner set forth in the Bylaws of the Corporation. Until the earliest of (i) the Mandatory Conversion Time, (ii) such time as no Preferred Stock is otherwise outstanding, or (iii) such time that no holder of Preferred Stock is entitled to elect a Preferred Director, any committee of the Board of Directors shall include any then-serving Preferred Director who wishes to serve on such committee, unless the sole purpose of the committee is to consider a matter where such Preferred Director has a conflict of interest, as reasonably determined by the Board of Directors, or such Preferred Director chooses not to serve or has otherwise recused himself or herself from such committee.

**SEVENTH**: Elections of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide.

**EIGHTH**: Meetings of stockholders may be held within or outside of the State of Delaware, as the Bylaws of the Corporation may provide. The books of the Corporation may be kept (subject to any provision of applicable law) outside of the State of Delaware at such place or places or in such manner or manners as may be designated from time to time by the Board of Directors or in the Bylaws of the Corporation.

**NINTH**: To the fullest extent permitted by law, a director or officer of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director or officer. If the General Corporation Law or any other law of the State of Delaware is amended after approval by the stockholders of this <u>Article Ninth</u> to authorize corporate action further eliminating or limiting the personal liability of directors or officers, then the liability of a director or officer of the Corporation shall be eliminated or limited to the fullest extent permitted by the General Corporation Law as so amended.

Any amendment, repeal or elimination of the foregoing provisions of this <u>Article Ninth</u> by the stockholders of the Corporation shall not adversely affect any right or protection of a director or officer of the Corporation existing at the time of, or increase the liability of any director or officer of the Corporation with respect to any acts or omissions of such director or officer occurring prior to, such amendment, repeal or elimination.

**TENTH** : The following indemnification provisions shall apply to the persons enumerated below.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Right to Indemnification of Directors and Officers</u>. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended, any person (an "**Indemnified Person**") who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "**Proceeding**"), by reason of the fact that such person, or a person for whom such person is the legal representative, is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, limited liability company, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such Indemnified Person in such Proceeding. Notwithstanding the preceding sentence, except as otherwise provided in <u>Section</u> <u>3</u> of this <u>Article Tenth</u>, the Corporation shall be required to indemnify an Indemnified Person in connection with a Proceeding (or part thereof) commenced by such Indemnified Person only if the commencement of such Proceeding (or part thereof) by the Indemnified Person was authorized in advance by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Prepayment of Expenses of Directors and Officers</u>. The Corporation shall pay the expenses (including attorneys' fees) incurred by an Indemnified Person in defending any Proceeding in advance of its final disposition, <u>provided</u>, <u>however</u>, that, to the extent required by law, such payment of expenses in advance of the final disposition of the Proceeding shall be made only upon receipt of an undertaking by the Indemnified Person to repay all amounts advanced if it should be ultimately determined that the Indemnified Person is not entitled to be indemnified under this <u>Article Tenth</u> or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Claims by Directors and Officers</u>. If a claim for indemnification or advancement of expenses under this <u>Article Tenth</u> is not paid in full within thirty (30) days after a written claim therefor by the Indemnified Person has been received by the Corporation, the Indemnified Person may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the Corporation shall have the burden of proving that the Indemnified Person is not entitled to the requested indemnification or advancement of expenses under applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Indemnification of Employees and Agents</u>. The Corporation may indemnify and advance expenses to any person who was or is made or is threatened to be made or is otherwise involved in any Proceeding by reason of the fact that such person, or a person for whom such person is the legal representative, is or was an employee or agent of the Corporation or, while an employee or agent of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, limited liability company, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such person in connection with such Proceeding. The ultimate determination of entitlement to indemnification of persons who are non-director or officer employees or agents shall be made in such manner as is determined by the Board of Directors in its sole discretion. Notwithstanding the foregoing sentence, the Corporation shall not be required to indemnify a person in connection with a Proceeding initiated by such person if the Proceeding was not authorized in advance by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Advancement of Expenses of Employees and Agents</u>. The Corporation may pay the expenses (including attorneys' fees) incurred by an employee or agent in defending any Proceeding in advance of its final disposition on such terms and conditions as may be determined by the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Non-Exclusivity of Rights</u>. The rights conferred on any person by this <u>Article Tenth</u> shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of this Certificate of Incorporation, the Bylaws of the Corporation, or any agreement, or pursuant to any vote of stockholders or disinterested directors or otherwise.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Other Indemnification</u>. The Corporation's obligation, if any, to indemnify any person who was or is serving at its request as a director, officer or employee of another corporation, partnership, limited liability company, joint venture, trust, organization or other enterprise shall be reduced by any amount such person may collect as indemnification from such other corporation, partnership, limited liability company, joint venture, trust, organization or other enterprise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Insurance</u>. The Board of Directors may, to the full extent permitted by applicable law as it presently exists, or may hereafter be amended from time to time, authorize an appropriate officer or officers to purchase and maintain at the Corporation's expense insurance: (a) to indemnify the Corporation for any obligation which it incurs as a result of the indemnification of directors, officers and employees under the provisions of this <u>Article Tenth</u>; and (b) to indemnify or insure directors, officers and employees against liability in instances in which they may not otherwise be indemnified by the Corporation under the provisions of this <u>Article Tenth</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Amendment or Repeal</u>. Any repeal or modification of the foregoing provisions of this <u>Article Tenth</u> shall not adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time of such repeal or modification. The rights provided hereunder shall inure to the benefit of any Indemnified Person and such person's heirs, executors and administrators.

**ELEVENTH**: The Corporation renounces, to the fullest extent permitted by law, any interest or expectancy of the Corporation in, or in being offered an opportunity to participate in, any Excluded Opportunity. An "**Excluded Opportunity**" is any matter, transaction or interest that is presented to, or acquired, created or developed by, or which otherwise comes into the possession of (i) any director of the Corporation who is not an employee of the Corporation or any of its subsidiaries, or (ii) any holder of Preferred Stock or any partner, member, director, stockholder, employee, affiliate or agent of any such holder, other than someone who is an officer or employee of the Corporation or any of its subsidiaries (collectively, the persons referred to in <u>clauses (i)</u> and <u>(ii)</u> are "**Covered Persons**"), unless such matter, transaction or interest is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely in such Covered Person's capacity as a director of the Corporation while such Covered Person is performing services in such capacity. Any repeal or modification of this <u>Article Tenth</u> will only be prospective and will not affect the rights under this <u>Article Tenth</u> in effect at the time of the occurrence of any actions or omissions to act giving rise to liability. Notwithstanding anything to the contrary contained elsewhere in this Amended and Restated Certificate of Incorporation, the affirmative vote of the Requisite Holders will be required to amend or repeal, or to adopt any provisions inconsistent with this <u>Article Tenth</u>.

**TWELFTH**: Unless the Corporation consents in writing to the selection of an alternative forum, (a) the Court of Chancery in the State of Delaware shall be the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation's stockholders, (iii) any action asserting a claim against the Corporation, its directors, officers or employees arising pursuant to any provision of the General Corporation Law or the Corporation's Restated Certificate or bylaws or (iv) any action asserting a claim against the Corporation, its directors, officers or employees governed by the internal affairs doctrine or that otherwise relates to the internal affairs of the Corporation, except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within 10 days following such determination), which

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is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction and (b) subject to the preceding provisions of this Article Twelfth, the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended. If any action the subject matter of which is within the scope of clause (a) of the immediately preceding sentence is filed in a court other than the courts in the State of Delaware (a "**Foreign Action**") in the name of any stockholder, such stockholder shall be deemed to have consented to (x) the personal jurisdiction of the state and federal courts in the State of Delaware in connection with any action brought in any such court to enforce the provisions of clause (a) of the immediately preceding sentence and (y) having service of process made upon such stockholder in any such action by service upon such stockholder's counsel in the Foreign Action as agent for such stockholder.

**THIRTEENTH**: If any provision or provisions of this Certificate of Incorporation shall be held to be invalid, illegal or unenforceable as applied to any person or entity or circumstance for any reason whatsoever, then, to the fullest extent permitted by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Certificate of Incorporation (including, without limitation, each portion of any sentence of this Certificate of Incorporation containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired thereby.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** That the foregoing amendment and restatement was approved by the holders of the requisite number of shares of this corporation in accordance with Section 228 of the General Corporation Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** That this Certificate of Incorporation, which restates and integrates and further amends the provisions of this Corporation's Amended and Restated Certificate of Incorporation, has been duly adopted in accordance with Sections 242 and 245 of the General Corporation Law.

[Signature Page Follows]

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**IN WITNESS WHEREOF**, this Second Amended and Restated Certificate of Incorporation has been executed by a duly authorized officer of this corporation on September 4, 2025.

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| | |
|:---|:---|
| By: | /s/ Tasso Gianakakos |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tassos Gianakakos, Chief Executive Officer |

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[*Signature Page to Kardigan, Inc. - Second Amended & Restated Certificate of Incorporation*]

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**CERTIFICATE OF AMENDMENT** 

**TO** 

**SECOND AMENDED AND RESTATED** 

**CERTIFICATE OF INCORPORATION** 

**OF** 

**KARDIGAN, INC.** 

Kardigan, Inc. (the "**Corporation**"), a corporation organized and existing under the General Corporation Law of the State of Delaware (the "**General Corporation Law**"), does hereby certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** That the name of the Corporation is Kardigan, Inc., and that this Corporation was originally incorporated pursuant to the General Corporation Law on August 18, 2023 under the name EnCarda, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** That the Second Amended and Restated Certificate of Incorporation of this Corporation was filed with the Secretary of State of the State of Delaware on September 4, 2025 (the "**Existing Certificate**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** That the Board of Directors of this Corporation duly adopted a resolution setting forth a proposed amendment to the Existing Certificate, and declared said amendment to be advisable, and in the best interests of the Corporation and its stockholders, and authorizing the appropriate officers of Corporation to solicit the consent of the stockholders therefor, which resolution setting forth the proposed amendment is as follows:

**RESOLVED**, that the Existing Certificate of the Corporation be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The first paragraph of Article FOURTH of the Existing Certificate is hereby amended and restated in its
entirety to read as herein set forth in full:

"The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 82,884,423. The Corporation has two classes of stock, referred to as Common Stock and Preferred Stock. There are 53,365,000 shares of authorized Common Stock, $0.00001 par value per share ("**Common Stock**") and 29,519,423 shares of authorized Preferred Stock, $0.00001 par value per share ("**Preferred Stock**"), 17,256,508 of which are hereby designated as "**Series A Preferred Stock**", 8,482,146 of which are hereby designated as "**Series B Preferred Stock**" and 3,780,769 of which are hereby designated as "**Series B-1 Preferred Stock**"."

\* \* \*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** The foregoing amendment was approved by the holders of the requisite number of shares of the Corporation in accordance with Section 228 of the General Corporation Law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** That the Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation, which amends the provisions of the Corporation's Existing Certificate, has been duly adopted in accordance with provisions of Section 242 of the General Corporation Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** All other provisions of the Existing Certificate shall remain in full force and effect.

[*Remainder of page intentionally left blank.*]

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IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation to be signed by its authorized officer as of the 9th day of October, 2025.

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| |
|:---|
| **KARDIGAN, INC.** |
| /s/ Tassos Gianakakos |
| Tassos Gianakakos |
| Chief Executive Officer |

---

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**SECOND CERTIFICATE OF AMENDMENT** 

**TO** 

**SECOND AMENDED AND RESTATED** 

**CERTIFICATE OF INCORPORATION** 

**OF** 

**KARDIGAN, INC.** 

Kardigan, Inc. (the "**Corporation**"), a corporation organized and existing under the General Corporation Law of the State of Delaware (the "**General Corporation Law**"), does hereby certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** That the name of the Corporation is Kardigan, Inc., and that this Corporation was originally incorporated pursuant to the General Corporation Law on August 18, 2023 under the name EnCarda, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** That the Second Amended and Restated Certificate of Incorporation of this Corporation was filed with the Secretary of State of the State of Delaware on September 4, 2025 and amended on October 9, 2025 (the "**Existing Certificate**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** That the Board of Directors of this Corporation duly adopted a resolution setting forth a proposed amendment to the Existing Certificate, and declared said amendment to be advisable, and in the best interests of the Corporation and its stockholders, and authorizing the appropriate officers of Corporation to solicit the consent of the stockholders therefor, which resolution setting forth the proposed amendment is as follows:

**RESOLVED**, that the Existing Certificate of the Corporation be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The first paragraph of Article FOURTH of the Existing Certificate is hereby amended and restated in its
entirety to read as herein set forth in full:

"The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 84,184,423. The Corporation has two classes of stock, referred to as Common Stock and Preferred Stock. There are 54,665,000 shares of authorized Common Stock, $0.00001 par value per share ("**Common Stock**") and 29,519,423 shares of authorized Preferred Stock, $0.00001 par value per share ("**Preferred Stock**"), 17,256,508 of which are hereby designated as "**Series A Preferred Stock**", 8,482,146 of which are hereby designated as "**Series B Preferred Stock**" and 3,780,769 of which are hereby designated as "**Series B-1 Preferred Stock**"."

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** The foregoing amendment was approved by the holders of the requisite number of shares of the Corporation in accordance with Section 228 of the General Corporation Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** That the Second Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation, which amends the provisions of the Corporation's Existing Certificate, has been duly adopted in accordance with provisions of Section 242 of the General Corporation Law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** All other provisions of the Existing Certificate shall remain in full force and effect.

[*Remainder of page intentionally left blank.*]

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IN WITNESS WHEREOF, the Corporation has caused this Second Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation to be signed by its authorized officer as of the 16th day of February, 2026.

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| |
|:---|
| **KARDIGAN, INC.** |
| /s/ Tassos Gianakakos |
| Tassos Gianakakos |
| Chief Executive Officer |

---

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**THIRD CERTIFICATE OF AMENDMENT** 

**TO** 

**SECOND AMENDED AND RESTATED** 

**CERTIFICATE OF INCORPORATION** 

**OF** 

**KARDIGAN, INC.** 

Kardigan, Inc. (the "**Corporation**"), a corporation organized and existing under the General Corporation Law of the State of Delaware (the "**General Corporation Law**"), does hereby certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** That the name of the Corporation is Kardigan, Inc., and that this Corporation was originally incorporated pursuant to the General Corporation Law on August 18, 2023 under the name EnCarda, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** That the Second Amended and Restated Certificate of Incorporation of this Corporation was filed with the Secretary of State of the State of Delaware on September 4, 2025 and amended on October 9, 2025 and February 16, 2026 (the "**Existing Certificate**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** That the Board of Directors of this Corporation duly adopted a resolution setting forth a proposed amendment to the Existing Certificate, and declared said amendment to be advisable, and in the best interests of the Corporation and its stockholders, and authorizing the appropriate officers of Corporation to solicit the consent of the stockholders therefor, which resolution setting forth the proposed amendment is as follows:

**RESOLVED**, that the Existing Certificate of the Corporation be amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The first paragraph of Article FOURTH of the Existing Certificate is hereby amended and restated in its
entirety to read as herein set forth in full:

"The total number of shares of all classes of stock which the Corporation shall have the authority to issue is 85,120,529. The Corporation has two classes of stock, referred to as Common Stock and Preferred Stock. There are 55,133,053 shares of authorized Common Stock, $0.00001 par value per share ("**Common Stock**") and 29,987,476 shares of authorized Preferred Stock, $0.00001 par value per share ("**Preferred Stock**"), 17,256,508 of which are hereby designated as "**Series A Preferred Stock**", 8,950,199 of which are hereby designated as "**Series B Preferred Stock**" and 3,780,769 of which are hereby designated as "**Series B-1 Preferred Stock**"."

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** The foregoing amendment was approved by the holders of the requisite number of shares of the Corporation in accordance with Section 228 of the General Corporation Law.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** That the Third Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation, which amends the provisions of the Corporation's Existing Certificate, has been duly adopted in accordance with provisions of Section 242 of the General Corporation Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** All other provisions of the Existing Certificate shall remain in full force and effect.

[*Remainder of page intentionally left blank.*]

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IN WITNESS WHEREOF, the Corporation has caused this Third Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation to be signed by its authorized officer as of the 17th day of March, 2026.

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| |
|:---|
| **KARDIGAN, INC.** |
| /s/ Tassos Gianakakos |
| Tassos Gianakakos |
| Chief Executive Officer |

---

**SIGNATURE PAGE TO THIRD CERTIFICATE OF AMENDMENT OF** 

**SECOND AMENDED AND RESTATED** 

**CERTIFICATE OF INCORPORATION OF KARDIGAN, INC.**

## Exhibit 3.3

**Exhibit 3.3** 

**ENCARDA, INC.** 

**BYLAWS** 

**Adopted August 18, 2023** 

**ARTICLE I - STOCKHOLDERS** 

Section 1 <u>Annual Meeting</u>.

An annual meeting of the stockholders, for the election of directors to succeed those whose terms expire and for the transaction of such other business as may properly come before the meeting, shall be held at such place, on such date, and at such time as the board of directors (the "**Board of Directors**") of EnCarda, Inc. (the "**Corporation**") shall each year fix, which date shall be within 13 months of the last annual meeting of stockholders or, if no such meeting has been held, the date of incorporation.

Section 2 <u>Special Meetings</u>.

Special meetings of the stockholders, for any purpose or purposes prescribed in the notice of the meeting, may be called by the Board of Directors or the Chief Executive Officer and shall be held at such place, on such date, and at such time as they or he or she shall fix.

Section 3 <u>Notice of Meetings</u>.

Notice of the place, if any, date, and time of all meetings of the stockholders, the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, and the record date for determining the stockholders entitled to vote at the meeting, if such date is different from the record date for determining stockholders entitled to notice of the meeting, shall be given, not less than 10 nor more than 60 days before the date on which the meeting is to be held, to each stockholder entitled to vote at such meeting as of the record date for determining the stockholders entitled to notice of the meeting, except as otherwise provided herein or required by law (meaning, here and hereinafter, as required from time to time by the Delaware General Corporation Law or the Certificate of Incorporation of the Corporation).

When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place, if any, thereof, and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken; *provided*, *however*, that if the date of any adjourned meeting is more than 30 days after the date for which the meeting was originally noticed, notice of the place, if any, date, and time of the adjourned meeting and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such adjourned meeting, shall be given to each stockholder in conformity herewith. If after the adjournment a new record date for stockholders entitled to vote is fixed for the adjourned meeting, the Board of Directors shall fix a new record date for notice of such adjourned meeting, which record date shall not precede the date upon which the resolution fixing the record date is

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adopted by the Board of Directors and, except as otherwise required by law, shall not be less than 10 nor more than 60 days before the date of such adjourned meeting, and shall give notice of the adjourned meeting to each stockholder of record entitled to vote at such adjourned meeting as of the record date fixed for notice of such adjourned meeting. At any adjourned meeting, any business may be transacted which might have been transacted at the original meeting.

Section 4 <u>Quorum</u>.

At any meeting of the stockholders, the holders of a majority of the voting power of all of the shares of stock entitled to vote at the meeting, present in person or by proxy, shall constitute a quorum for all purposes, unless or except to the extent that the presence of a larger number may be required by law. Where a separate vote by a class or classes or series is required, a majority of the voting power of the shares of such class or classes or series present in person or represented by proxy shall constitute a quorum entitled to take action with respect to that vote on that matter. The stockholders present at a duly constituted meeting may continue to transact business until adjournment notwithstanding the withdrawal of enough stockholders to reduce the voting shares below a quorum.

If a quorum shall fail to attend any meeting, the chairman of the meeting or the holders of a majority of the shares of stock entitled to vote who are present, in person or by proxy, may adjourn the meeting to another place, if any, date, or time.

Section 5 <u>Organization</u>.

Such person as the Board of Directors may have designated or, in the absence of such a person, the President or Chief Executive Officer of the Corporation or, in his or her absence, such person as may be chosen by the holders of a majority of the voting power of the shares entitled to vote who are present, in person or by proxy, shall call to order any meeting of the stockholders and act as chairman of the meeting. In the absence of the Secretary of the Corporation, the secretary of the meeting shall be such person as the chairman of the meeting appoints.

Section 6 <u>Conduct of Business</u>.

The chairman of any meeting of stockholders shall determine the order of business and the procedure at the meeting, including such regulation of the manner of voting and the conduct of discussion as seem to him or her in order. The date and time of the opening and closing of the polls for each matter upon which the stockholders will vote at the meeting shall be announced at the meeting.

Section 7 <u>Proxies and Voting</u>.

At any meeting of the stockholders, every stockholder entitled to vote may vote in person or by proxy authorized by an instrument in writing or by a transmission permitted by law filed in accordance with the procedure established for the meeting. Any copy, facsimile communication or other reliable reproduction of the writing or transmission created pursuant to this paragraph may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, *provided that* such copy, facsimile communication or other reproduction shall be a complete reproduction of the entire original writing or transmission.

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The Corporation may, and to the extent required by law, shall, in advance of any meeting of stockholders, appoint one or more inspectors to act at the meeting and make a written report thereof. The Corporation may designate one or more alternate inspectors to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the person presiding at the meeting may, and to the extent required by law, shall, appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of his or her ability. Every vote taken by ballots shall be counted by an inspector or inspectors appointed by the chairman of the meeting.

All elections shall be determined by a plurality of the votes cast, and except as otherwise required by law, all other matters shall be determined by a majority of the votes cast affirmatively or negatively.

Section 8 <u>Stock List</u>.

The officer who has charge of the stock ledger of the Corporation shall, at least 10 days before every meeting of stockholders, prepare and make a complete list of stockholders entitled to vote at any meeting of stockholders, *provided*, *however*, if the record date for determining the stockholders entitled to vote is less than 10 days before the meeting date, the list shall reflect the stockholders entitled to vote as of the 10th day before the meeting date, arranged in alphabetical order and showing the address of each such stockholder and the number of shares registered in his or her name. Such list shall be open to the examination of any stockholder for a period of at least 10 days prior to the meeting in the manner provided by law.

A stock list shall also be open to the examination of any stockholder during the whole time of the meeting as provided by law. This list shall presumptively determine (a) the identity of the stockholders entitled to examine such stock list and to vote at the meeting and (b) the number of shares held by each of them.

Section 9 <u>Consent of Stockholders in Lieu of Meeting</u>.

Any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken at any annual or special meeting of the stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation's registered office shall be made by hand or by certified or registered mail, return receipt requested.

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Every written consent shall bear the date of signature of each stockholder who signs the consent, and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the earliest dated consent delivered to the Corporation, a written consent or consents signed by a sufficient number of holders to take action are delivered to the Corporation in the manner prescribed in the first paragraph of this Section. A telegram, cablegram or other electronic transmission consenting to an action to be taken and transmitted by a stockholder or proxyholder, or by a person or persons authorized to act for a stockholder or proxyholder, shall be deemed to be written, signed and dated for the purposes of this Section to the extent permitted by law. Any such consent shall be delivered in accordance with Section 228(d)(1) of the Delaware General Corporation Law.

Any copy, facsimile or other reliable reproduction of a consent in writing may be substituted or used in lieu of the original writing for any and all purposes for which the original writing could be used, *provided that* such copy, facsimile or other reproduction shall be a complete reproduction of the entire original writing.

**ARTICLE II - BOARD OF DIRECTORS** 

Section 1 <u>Number and Term of Office</u>.

The number of directors who shall constitute the whole Board of Directors shall be such number as the Board of Directors shall from time to time have designated. Each director shall be elected for a term of one (1) year and until his or her successor is elected and qualified, except as otherwise provided herein or required by law.

Whenever the authorized number of directors is increased between annual meetings of the stockholders, a majority of the directors then in office shall have the power to elect such new directors for the balance of a term and until their successors are elected and qualified. Any decrease in the authorized number of directors shall not become effective until the expiration of the term of the directors then in office unless, at the time of such decrease, there shall be vacancies on the board which are being eliminated by the decrease.

Section 2 <u>Removal of Directors; Resignation</u> Unless otherwise provided by the Certificate of Incorporation or these Bylaws, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of shares entitled to vote at an election of directors. Any director may resign at any time upon notice given in writing or by electronic transmission to the Corporation. Such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some other event.

Section 3 <u>Vacancies</u>. Unless otherwise provided in the Corporation's Certificate of Incorporation, as it may be amended, if the office of any director becomes vacant by reason of death, resignation, disqualification, removal or other cause, a majority of the directors remaining in office, although less than a quorum, may elect a successor for the unexpired term and until his or her successor is elected and qualified. Unless otherwise provided in the Corporation's Certificate of Incorporation, as it may be amended, vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by a majority of the directors then in office, though less than a quorum, or by a sole remaining director, and the directors so chosen shall hold office until the next annual election and until their successors are duly elected and shall qualify, unless sooner displaced. If there are no directors in office, then an election of directors may be held in the manner provided by statute.

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Section 4 <u>Regular Meetings</u>. Regular meetings of the Board of Directors shall be held at such place or places, on such date or dates, and at such time or times as shall have been established by the Board of Directors and publicized among all directors. A notice of each regular meeting shall not be required.

Section 5 <u>Special Meetings</u>. Special meetings of the Board of Directors may be called by one-third of the directors then in office (rounded up to the nearest whole number) or by the President and shall be held at such place, on such date, and at such time as they or he or she shall fix. Notice of the place, date, and time of each such special meeting shall be given to each director by whom it is not waived by mailing written notice not less than five days before the meeting or by telegraphing or telexing or by facsimile or electronic transmission of the same not less than 24 hours before the meeting. Unless otherwise indicated in the notice thereof, any and all business may be transacted at a special meeting. A meeting may be held at any time without notice if all the directors are present (except as otherwise provided by law) or if those not present waive notice of the meeting in writing, either before or after such meeting.

Section 6 <u>Quorum</u>. At any meeting of the Board of Directors, the greater of (a) a majority of the directors then in office at the time quorum is to be determined and (b) one-third of the total number of directors fixed pursuant to Section 1 of Article II of these Bylaws shall constitute a quorum for the transaction of business. Less than a quorum may adjourn any meeting from time to time, and the meeting may be held as adjourned without further notice.

Section 7 <u>Participation in Meetings By Conference Telephone</u>. Members of the Board of Directors, or of any committee thereof, may participate in a meeting of such Board of Directors or committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation shall constitute presence in person at such meeting.

Section 8 <u>Conduct of Business</u>. At any meeting of the Board of Directors, business shall be transacted in such order and manner as the Board of Directors may from time to time determine, and all matters shall be determined by the vote of a majority of the directors present, except as otherwise provided herein or required by law. Action may be taken by the Board of Directors without a meeting if all members thereof consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board of Directors. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

Section 9 <u>Compensation of Directors</u>. Directors, as such, may receive, pursuant to resolution of the Board of Directors, fixed fees and other compensation for their services as directors, including, without limitation, their services as members of committees of the Board of Directors.

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**ARTICLE III - COMMITTEES** 

Section 1 <u>Committees of the Board of Directors</u>.

The Board of Directors may from time to time designate committees of the Board of Directors, with such lawfully delegable powers and duties as it thereby confers, to serve at the pleasure of the Board of Directors and shall, for those committees and any others provided for herein, elect a director or directors to serve as the member or members, designating, if it desires, other directors as alternate members who may replace any absent or disqualified member at any meeting of the applicable committee. In the absence or disqualification of any member of any committee and any alternate member in his or her place, the member or members of the committee present at the meeting and not disqualified from voting, whether or not he or she or they constitute a quorum, may by unanimous vote appoint another member of the Board of Directors to act at the meeting in the place of the absent or disqualified member.

Section 2 <u>Conduct of Business</u>.

Each committee may determine the procedural rules for meeting and conducting its business and shall act in accordance therewith, except as otherwise provided herein or required by law. Adequate provision shall be made for notice to members of all meetings; one-third of the members shall constitute a quorum unless the committee shall consist of one or two members, in which event one member shall constitute a quorum; and all matters shall be determined by a majority vote of the members present. Action may be taken by any committee without a meeting if all members thereof consent thereto in writing or by electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of the proceedings of such committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

**ARTICLE IV - OFFICERS** 

Section 1 <u>Generally</u>.

The officers of the Corporation will be chosen by the Board of Directors and will consist of a President, a Secretary, a Treasurer and such other officers as may from time to time be appointed by the Board of Directors. Officers shall be elected by the Board of Directors, which shall consider that subject at its first meeting after every annual meeting of stockholders. Each officer shall hold office until his or her successor is elected and qualified or until his or her earlier resignation or removal. Any number of offices may be held by the same person.

Subject to any limitations which may be set forth in a resolution of the Board of Directors, all deeds, leases, transfers, contracts, bonds, notes and other obligations to be entered into by the Corporation in the ordinary course of its business without director action may be executed on behalf of the Corporation by a President or by any other officer, employee or agent of the Corporation as the Board of Directors may authorize.

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Section 2 <u>President</u>.

The President shall be the Chief Executive Officer of the Corporation. Subject to the provisions of these Bylaws and to the direction of the Board of Directors, he or she shall have the responsibility for the general management and control of the business and affairs of the Corporation and shall perform all duties and have all powers which are commonly incident to the office of chief executive or which are delegated to him or her by the Board of Directors. He or she shall have power to sign all stock certificates, contracts and other instruments of the Corporation which are authorized and shall have general supervision and direction of all of the other officers, employees and agents of the Corporation.

Section 3 <u>Vice President</u>.

Each Vice President shall have such powers and duties as may be delegated to him or her by the Board of Directors. One Vice President shall be designated by the Board of Directors to perform the duties and exercise the powers of the President in the event of the President's absence or disability.

Section 4 <u>Treasurer</u>.

The Treasurer shall have the responsibility for maintaining the financial records of the Corporation. He or she shall make such disbursements of the funds of the Corporation as are authorized and shall render from time to time an account of all such transactions and of the financial condition of the Corporation. The Treasurer shall also perform such other duties as the Board of Directors may from time to time prescribe.

Section 5 <u>Secretary</u>.

The Secretary shall issue all authorized notices for, and shall keep minutes of, all meetings of the stockholders and the Board of Directors. He or she shall have charge of the corporate books and shall perform such other duties as the Board of Directors may from time to time prescribe.

Section 6 <u>Chairman of the Board</u>.

Unless otherwise provided by the Board of Directors, the Chairman of the Board of Directors, if one is elected, shall preside, when present, at all meetings of the stockholders and the Board of Directors. The Chairman of the Board shall have such other powers and shall perform such duties as the Board of Directors may from time to time designate.

Section 7 <u>Delegation of Authority</u>.

The Board of Directors may from time to time delegate the powers or duties of any officer to any other officers or agents, notwithstanding any provision hereof.

Section 8 <u>Removal</u>.

Any officer of the Corporation may be removed at any time, with or without cause, by the Board of Directors.

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Section 9 <u>Action with Respect to Securities of Other Corporations</u>.

Unless otherwise directed by the Board of Directors, the President or any officer of the Corporation authorized by the President shall have power to vote and otherwise act on behalf of the Corporation, in person or by proxy, at any meeting of stockholders of or with respect to any action of stockholders of any other corporation in which this Corporation may hold securities and otherwise to exercise any and all rights and powers which this Corporation may possess by reason of its ownership of securities in such other corporation.

**ARTICLE V - STOCK** 

Section 1 <u>Certificates of Stock</u>.

The shares of the Corporation shall be represented by certificates, *provided that* the Board may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the Corporation. Each holder of stock represented by certificates shall be entitled to a certificate signed by, or in the name of the Corporation, by any two of the President, a Vice President, the Secretary, an Assistant Secretary, the Treasurer, an Assistant Treasurer or any other authorized officers of the Corporation, certifying the number of shares owned by him or her. Any or all of the signatures on the certificate may be by facsimile.

Section 2 <u>Transfers of Stock</u>.

Transfers of stock shall be made only upon the transfer books of the Corporation kept at an office of the Corporation or by transfer agents designated to transfer shares of the stock of the Corporation. Except where a certificate is issued in accordance with <u>Section 4</u> of <u>Article V</u> of these Bylaws, an outstanding certificate, if one has been issued, for the number of shares involved shall be surrendered for cancellation before a new certificate, if any, is issued therefor.

Section 3 <u>Record Date</u>.

In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjournment thereof, the Board of Directors may, except as otherwise required by law, fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be less than 10 nor more than 60 days before the date of such meeting. If the Board of Directors so fixes a date, such date shall also be the record date for determining the stockholders entitled to vote at such meeting unless the Board of Directors determines, at the time it fixes such record date, that a later date on or before the date of the meeting shall be the date for making such determination. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of and to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; *provided*, *however*, that the Board of Directors may fix a new record date for determination of stockholders entitled to vote at the adjourned meeting, and in such case shall also fix as the record date for stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of stockholders entitled to vote in accordance with the foregoing provisions of this <u>Section</u> <u>3</u> at the adjourned meeting.

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In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than 60 days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

In order that the Corporation may determine the stockholders entitled to consent to corporate action without a meeting, (including by telegram, cablegram or other electronic transmission as permitted by law), the Board of Directors may fix a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall be not more than 10 days after the date upon which the resolution fixing the record date is adopted. If no record date has been fixed by the Board of Directors and no prior action by the Board of Directors is required by the Delaware General Corporation Law, the record date shall be the first date on which a consent setting forth the action taken or proposed to be taken is delivered to the Corporation in the manner prescribed by <u>Section</u> <u>9</u> of <u>Article</u> <u>I</u> of these Bylaws. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by the Delaware General Corporation Law with respect to the proposed action by consent of the stockholders without a meeting, the record date for determining stockholders entitled to consent to corporate action without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

Section 4 <u>Lost, Stolen or Destroyed Certificates</u>.

In the event of the loss, theft or destruction of any certificate of stock, another may be issued in its place pursuant to such regulations as the Board of Directors may establish concerning proof of such loss, theft or destruction and concerning the giving of a satisfactory bond or bonds of indemnity.

Section 5 <u>Regulations</u>.

The issue, transfer, conversion and registration of certificates of stock shall be governed by such other regulations as the Board of Directors may establish.

**ARTICLE VI - NOTICES** 

Section 1 <u>Notices</u>.

If mailed, notice to stockholders shall be deemed given when deposited in the mail, postage prepaid, directed to the stockholder at such stockholder's address as it appears on the records of the Corporation. Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders may be given by electronic transmission in the manner provided in Section 232 of the Delaware General Corporation Law.

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Section 2 <u>Waivers</u>.

A written waiver of any notice, signed by a stockholder or director, or waiver by electronic transmission by such person, whether given before or after the time of the event for which notice is to be given, shall be deemed equivalent to the notice required to be given to such person. Neither the business nor the purpose of any meeting need be specified in such a waiver. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened.

**ARTICLE VII - MISCELLANEOUS** 

Section 1 <u>Facsimile Signatures</u>.

In addition to the provisions for use of facsimile signatures elsewhere specifically authorized in these Bylaws, facsimile signatures of any officer or officers of the Corporation may be used whenever and as authorized by the Board of Directors or a committee thereof.

Section 2 <u>Corporate Seal</u>.

The Board of Directors may provide a suitable seal, containing the name of the Corporation, which seal shall be in the charge of the Secretary. If and when so directed by the Board of Directors or a committee thereof, duplicates of the seal may be kept and used by the Treasurer or by an Assistant Secretary or Assistant Treasurer.

Section 3 <u>Reliance upon Books, Reports and Records</u>.

Each director, each member of any committee designated by the Board of Directors, and each officer of the Corporation shall, in the performance of his or her duties, be fully protected in relying in good faith upon the books of account or other records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or committees of the Board of Directors so designated, or by any other person as to matters which such director or committee member reasonably believes are within such other person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.

Section 4 <u>Fiscal Year</u>.

The fiscal year of the Corporation shall be as fixed by the Board of Directors.

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Section 5 <u>Offices</u>.

The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.

Section 6 <u>Records and Reports</u>.

The application and requirements of Section 1501 of the California General Corporation Law are hereby expressly waived to the fullest extent permitted thereunder.

Section 7 <u>Time Periods</u>.

In applying any provision of these Bylaws which requires that an act be done or not be done a specified number of days prior to an event or that an act be done during a period of a specified number of days prior to an event, calendar days shall be used, the day of the doing of the act shall be excluded, and the day of the event shall be included.

**ARTICLE VIII - INDEMNIFICATION OF DIRECTORS AND OFFICERS** 

Section 1 <u>Right to Indemnification</u>.

Each person who was or is made a party to or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "**proceeding**"), by reason of the fact that he or she is or was a director or an officer of the Corporation or is or was serving at the request of the Corporation as a director, officer, or trustee of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter an "**indemnitee**"), whether the basis of such proceeding is alleged action in an official capacity as a director, officer or trustee, or in any other capacity while serving as a director, officer or trustee, shall be indemnified and held harmless by the Corporation to the fullest extent permitted by Delaware law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment) against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith; *provided*, *however*, that, except as provided in <u>Section</u> <u>3</u> of this <u>Article VIII</u> with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors.

Section 2 <u>Right to Advancement of Expenses</u>.

In addition to the right to indemnification conferred in <u>Section</u> <u>1</u> of this <u>Article VIII</u>, an indemnitee shall also have the right to be paid by the Corporation the expenses (including attorney's fees) incurred in defending any such proceeding in advance of its final disposition (hereinafter an "**advancement of expenses**"); *provided*, *however*, that, if the Delaware General Corporation Law requires, an advancement of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered

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by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an "**undertaking**"), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a "**final adjudication**") that such indemnitee is not entitled to be indemnified for such expenses under this <u>Section</u> <u>2</u> or otherwise.

Section 3 <u>Right of Indemnitee to Bring Suit</u>.

If a claim under <u>Section</u> <u>1</u> or <u>2</u> of this <u>Article VIII</u> is not paid in full by the Corporation within 60 days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 20 days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. To the fullest extent permitted by law, if successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such suit. In (i) any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that, the indemnitee has not met any applicable standard for indemnification set forth in the Delaware General Corporation Law. Neither the failure of the Corporation (including its directors who are not parties to such action, a committee of such directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the Corporation (including its directors who are not parties to such action, a committee of such directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this <u>Article VIII</u> or otherwise, shall be on the Corporation.

Section 4 <u>Non-Exclusivity of Rights</u>.

The rights to indemnification and to the advancement of expenses conferred in this <u>Article VIII</u> shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, the Corporation's Certificate of Incorporation, these Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.

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Section 5 <u>Insurance</u>.

The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

Section 6 Inde<u>mnification of Employees and Agents of the Corporation</u>.

The Corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification and to the advancement of expenses to any employee or agent of the Corporation to the fullest extent of the provisions of this <u>Article VIII</u> with respect to the indemnification and advancement of expenses of directors and officers of the Corporation.

Section 7 <u>Nature of Rights</u>.

The rights conferred upon indemnitees in this <u>Article VIII</u> shall be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director, officer or trustee and shall inure to the benefit of such indemnitee's heirs, executors and administrators. Any amendment, alteration or repeal of this <u>Article VIII</u> that adversely affects any right of an indemnitee or his, her or its successors shall be prospective only and shall not limit, eliminate, or impair any such right with respect to any proceeding involving any occurrence or alleged occurrence of any action or omission to act that took place prior to such amendment, alteration or repeal.

**ARTICLE IX - AMENDMENTS** 

These Bylaws may be amended or repealed by the Board of Directors at any meeting or by the stockholders at any meeting.

**CERTIFICATE OF SECRETARY OF** 

**ENCARDA, INC.** 

The undersigned, Jay Edelberg, hereby certifies that he is the duly elected and acting Secretary of EnCarda, Inc., a Delaware corporation (the "**Corporation**"), and that the Bylaws attached hereto constitute the Bylaws of said Corporation as duly adopted by Action by Unanimous Written Consent in Lieu of Organizational Meeting by the Board of Directors on August 18, 2023.

**IN WITNESS WHEREOF**, the undersigned has hereunto subscribed his name this 18th day of August, 2023.

/s/ Tassos Anastasios Gianakakos<br> Tassos Anastasios Gianakakos, Secretary<br>

## Exhibit 4.2

**Exhibit 4.2** 

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT. 

Date of Issuance: September 4, 2025

**KARDIGAN, INC.** 

**WARRANT TO PURCHASE SHARES OF COMMON STOCK** 

For value received in connection with the Holder (as defined below)'s purchase of Series B Preferred Stock of the Company (as defined below) pursuant to that certain Series B Preferred Stock Purchase Agreement, dated September 4, 2025, the receipt and sufficiency of which is hereby acknowledged, this Warrant (the "<u>Warrant</u>") is issued to **ARCH Venture Fund XIII, L.P.** (together with such holder's assigns in accordance with the terms of this Warrant, the "<u>Holder</u>") by **Kardigan, Inc.** (the "<u>Company</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Purchase of Shares</u> <u>.</u>  **<u><sup></sup></u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Number of Shares</u>. Subject to the terms and conditions set forth herein (including
as set forth in <u>Section 2(a)</u> below), the Holder is entitled to purchase from the Company up to 550,000 fully paid and nonassessable shares of Exercise Stock (as defined below) subject to adjustment pursuant to <u>Section 8</u> hereof (the " <u>Shares</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Exercise Price</u>. The exercise price for the Shares shall be $21.36508 per share (the
" <u>Exercise Price</u> "). The Shares and the Exercise Price shall be subject to adjustment pursuant to Section 8 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Type of Shares</u>. The Shares issuable upon exercise of this Warrant shall be shares of the
Company's Common Stock (the " <u>Exercise Stock</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise Period</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Warrant shall be exercisable, in whole or in part, only upon the first date the Company achieves a
Valuation (as defined below) of $5,000,000,000 (as reasonably determined by the Company's Board of Directors (the " <u>Board</u> ")) and ending at 5:00 p.m. E.T. on the tenth anniversary of the Date of Issuance (the
" <u>Exercise Period</u> ") .

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Notwithstanding anything to the contrary contained herein, if any of the vesting milestones set forth in the CEO Grant with respect to a Valuation equal to or in excess of $5,000,000,000 are accelerated by the Board without the achievement of such vesting Valuation milestone(s) in accordance with the terms of the CEO Grant, then the $5,000,000,000 Valuation shall also be deemed achieved for purposes of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Definitions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. " <u>CEO Grant</u> " means that certain Early Exercise Non-Qualified Stock Option Agreement under the Plan issued to Tassos Gianakakos dated on or about September 4, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. " <u>Certificate of Incorporation</u> " means the Company's Amended and Restated Certificate of
Incorporation, as may be amended and/or restated from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. " <u>Consideration</u> " means the value of cash and/or non-cash property (including equity securities, notes and other similar non-cash property) received by holders of Securities in a Sale Event. For the purposes hereof, non-cash property shall be valued in good faith by the Board including the then-seated Preferred Directors (as defined in the Certificate of Incorporation). For the purpose of calculating the amount of Consideration
received by holders of Securities, such holders shall be deemed to have received Holdback Proceeds only when and if such Holdback Proceeds are actually paid to such holders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. " <u>Holdback Proceeds</u> " means any portion of the aggregate value of the Consideration that
(i) is payable following the closing of a Sale Event, (ii) is contingent upon the performance of the Company or its assets, and/or attainment of financial targets, milestones, or other performance metrics or milestones following the
consummation of a Sale Event, including royalty payments and/or (iii) is held in an escrow fund or otherwise held back for indemnification, purchase price adjustment or other claims.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. " <u>Fully Diluted Valuation</u> " means (i) the Last Round Price <u>multiplied by</u> (ii) the number of Securities issued and outstanding (determined on an as-converted, as-exercised or as-exchanged to Common
Stock basis) treating all shares of Common Stock reserved and available for issuance under the Plan or other equity incentive plan or arrangement as issued and outstanding (only to the extent such shares of Common Stock reserved and available for
issuance were reserved for issuance prior to or at the time of the Company's last bona fide equity financing for the principal purpose of raising capital).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. " <u>Last Round Price</u> " means the cash price per share for which the Company last sold its
preferred stock (on an as-converted to Common Stock basis) in a bona fide equity financing for the principal purpose of raising capital.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. " <u>Market Capitalization</u> " means (i) the number of Securities issued and outstanding
(determined on an as-converted, as-exercised or as-exchanged to Common Stock basis) <u>multiplied by</u> (ii) the VWAP of a
share of Common Stock over the preceding thirty (30) day consecutive calendar period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;viii. " <u>Person</u> " shall mean any individual, corporation, partnership (limited or general), limited
liability company, limited liability partnership, association, trust, joint venture, unincorporated organization or any similar entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ix. " <u>Plan</u> " shall mean the Company's Amended and Restated 2023 Stock Option and Grant Plan,
as amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;x. " <u>Purchase Agreement</u> " shall mean the Company's Series B Preferred Stock Purchase
Agreement dated September 4, 2025 by and among the Company and the investors listed on Exhibit A thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xi. " <u>Sale Event</u> *"* shall mean a Deemed Liquidation Event as such term is defined in the
Certificate of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xii. " <u>Securities</u> " means the Company's capital stock and stock options, warrants, and other
securities directly or indirectly convertible into, exercisable for or exchangeable for shares of Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xiii. " <u>Termination Event</u> " means (a) the consummation of a Sale Event or (b) any
voluntary or involuntary liquidation, dissolution or winding up of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xiv. " <u>Valuation</u> " shall be measured as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. in the case of a Sale Event, the aggregate Consideration received (whether at the closing or following the
closing of such Sale Event) by holders of Securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. at any time prior to the Company's Initial Public Offering, the Fully Diluted Valuation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. at any time after the Company's Initial Public Offering, the Market Capitalization.

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All determinations of the Valuation shall be reasonably determined by the Board. Any determination by the Board regarding the Valuation shall be consistent with the determination of the Valuation (as defined in the CEO Grant) as set forth in the CEO Grant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xv. " <u>VWAP</u> " means the volume weighted average trading price of Common Stock as reported by
Bloomberg, L.P. (which VWAP, if calculated for a multi-day period, shall be based on all trades during the primary trading session from 9:30 a.m., New York City time, to the time of the closing print on the
primary exchange of the Company (or its successor entity, if any) but in no case later than 4:10 p.m. New York City time for such period, and not an average of daily averages) or, if not reported therein, in another authoritative source mutually
selected by the Holder and the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Method of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) While this Warrant remains outstanding and is exercisable in accordance with <u>Section 2</u> above, the
Holder may exercise, in whole or in part, to the extent then exercisable, the purchase rights evidenced hereby. Such exercise shall be effected by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. the surrender of the Warrant, together with a duly executed copy of the Notice of Exercise attached hereto, to
the Company at its principal office (or at such other place as the Company shall notify the Holder in writing); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the payment to the Company of an amount equal to the aggregate Exercise Price for the number of Shares being
purchased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business
on the day on which this Warrant is surrendered to the Company as provided in <u>Section 3(a)</u> above. At such time, the person or persons in whose name or names any certificate for the Shares shall be issuable upon such exercise as provided
in <u>Section 3(c)</u> below shall be deemed to have become the holder or holders of record of the Shares represented by such certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the exercise of the rights represented by this Warrant, a book entry or other evidence for the Shares so
purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates (upon payment by such Holder of any applicable transfer taxes and subject to the assignment restrictions hereof), shall be issued and
delivered to the Holder within a reasonable time after the rights represented by this Warrant shall have been so exercised. If this Warrant is exercised for fewer than all of the Shares, the Company shall issue to the Holder a new Warrant on
identical terms reflecting the remainder of the Shares.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Company shall provide written notice to the Holder at least ten (10) business days prior to the
consummation of a Termination Event. Notwithstanding the provisions of <u>Section 2</u>, in the event that the Company fails to provide such notice or if the holder has not exercised this Warrant prior to the closing of a Termination Event,
this Warrant shall automatically be deemed to be exercised to the extent exercisable in full in the manner set forth in <u>Section 4</u>, without any further action on behalf of the Holder immediately prior to such closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Notwithstanding the foregoing or anything to the contrary in this Warrant, if Holder, along with the Notice of
Exercise, notifies the Company that a filing under the Hart-Scott-Rodino Act of 1976, as amended (the " <u>HSR Act</u> ") may be required in connection with the proposed exercise of this Warrant, then the Company shall provide Holder with
such information as may be reasonably requested so that Holder may make a final determination of whether a filing is required. If Holder determines that an HSR Act filing is required, then the parties shall follow the procedures set forth herein and
no Shares shall be issued under this Warrant to Holder pursuant to the applicable Notice of Exercise until the applicable waiting period under the HSR Act has expired or been earlier terminated and this Warrant shall not terminate under any
circumstances until such issuance of such Shares has been completed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. If Holder determines that an HSR Act filing is required pursuant to <u>Section 3(e)</u>, then each of the
Company and Holder shall, as promptly as practicable, file with the United States Federal Trade Commission (the " <u>FTC</u> ") and Department of Justice Antitrust Division (the " <u>DOJ</u> ") an appropriate and complete
Notification and Report Form (the " <u>HSR Act Filings</u> "). The HSR Act Filings shall request early termination of the applicable waiting period under the HSR Act. Each of the Company and Holder shall, and shall cause its affiliates to,
furnish to the other party such necessary information (to the extent consistent with any applicable law) and reasonable assistance as the other party may request to determine whether an HSR Act Filing is required and in connection with its
preparation of the HSR Act Filings. Each of the Company and Holder shall, and shall cause its affiliates to, keep the other party apprised of the status of any communications by such party or any of its affiliates with, and any inquiries or requests
for additional information from, the FTC, the DOJ or any other governmental entity with respect to the HSR Act Filings or the transactions reported therein. Each of the Company and Holder shall, and the Company shall cause its affiliates to, comply
as promptly as practicable with any such inquiry or request and provide any supplemental information requested in connection with the HSR Act Filings or pursuant to any other applicable law. No party hereto or any of their respective affiliates
shall participate in any meeting or engage in any substantive conversation with any governmental entity with respect to the HSR Act Filings or transactions reported therein without giving the other party prior notice of the

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meeting or conversation. Any such provisions of information, rights to participate or consultations between the parties may be made on a counsel-only or outside counsel-only basis to the extent required under applicable law or as appropriate to protect sensitive business information or maintain attorney-client or other privilege. Notwithstanding anything in this Warrant to the contrary, if Holder has notified the Company that an HSR Act filing is required, then no Shares shall be issued under this Warrant to Holder until the applicable waiting period under the HSR Act has expired or been earlier terminated and this Warrant shall not terminate until such issuance has been completed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Net Exercise</u>. In lieu of exercising this Warrant with cash, the Holder may elect to receive shares equal
to the value of this Warrant (or the portion thereof being exercised) by surrender of this Warrant to the Company together with notice of such election (a " <u>Net Exercise</u> "). A Holder who Net Exercises shall have the rights described
in <u>Sections 3(b)</u> and <u>3(c)</u> hereof, and the Company shall issue to such Holder a number of Shares computed using the following formula:

![LOGO](g107928dsp52.jpg)

Where

X = The number of Shares to be issued to the Holder.

Y = The number of Shares purchasable and exercisable under this Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (at the date of such calculation).

A = The fair market value of one (1) Share (at the date of such calculation).

B = The Exercise Price (as adjusted to the date of such calculation).

For purposes of this <u>Section 4</u>, the fair market value of a Share shall mean the average of the closing prices of the Shares quoted in the over-the-counter market in which the Shares are traded or the closing price quoted on any exchange or electronic securities market on which the Shares are listed, whichever is applicable, as published in *The Wall Street Journal* for the thirty (30) trading days prior to the date of determination of fair market value (or such shorter period of time during which such Shares were traded over-the-counter or on such exchange). In the event that this Warrant is exercised pursuant to this <u>Section 4</u> in connection with the Company's first firm commitment underwritten public offering (the "<u>Initial Public Offering</u>"), the fair market value per Share shall be the per share offering price to the public of the Initial Public Offering. If the Shares are not traded on the over-the-counter market, an exchange or an electronic securities market, the fair market value shall be the highest price per Share that the Company could obtain from a willing buyer for Shares sold by the Company from authorized but unissued Shares, as determined in good faith by the Board, unless the Company is at such time subject to a Sale Event, in which case the fair market value of Warrant Stock shall be deemed to be the Consideration received by the holders of such stock pursuant to such Sale Event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Representations and Warranties of the Company</u>. In connection with the transactions provided for herein,
the Company hereby represents and warrants to the Holder that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Stock Purchase Agreement</u>. The Company expressly acknowledges and agrees that the representations and
warranties made by the Company in Section 2 of the Purchase Agreement, as qualified by the disclosures set forth in the Disclosure Schedule (as defined in the Purchase Agreement), are hereby incorporated and made a part of this Warrant, *mutatis mutandis*, in respect of the Company's issuance of the Warrant (and the underlying Shares) to the Holder; provided, that such representations and warranties are made as of the date hereof except as otherwise indicated in the
Purchase Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Organization, Good Standing, and Qualification</u>. The Company is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted. The Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse effect on its business or properties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Authorization</u>. Except as may be limited by applicable bankruptcy, insolvency, reorganization or similar
laws relating to or affecting the enforcement of creditors' rights, all corporate action has been taken on the part of the Company, its officers, directors, and stockholders necessary for the authorization, execution and delivery of this
Warrant. The Company has taken all corporate action required to make all the obligations of the Company reflected in the provisions of this Warrant the valid and enforceable obligations they purport to be. The issuance of this Warrant will not be
subject to preemptive rights of any stockholders of the Company. The Company has authorized sufficient shares of Exercise Stock to allow for the exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Compliance with Other Instruments</u>. The authorization, execution and delivery of the Warrant will not
constitute or result in a material default or violation of any law or regulation applicable to the Company or any material term or provision of the Certificate of Incorporation or bylaws, or any material agreement or instrument by which it is bound
or to which its properties or assets are subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Valid Issuance of Shares</u>. The Shares, when issued, sold, and delivered in accordance with the terms of
this Warrant for the consideration expressed therein, will be duly and validly issued, fully paid and nonassessable and, based in part upon the representations and warranties of the Holders in this Warrant, will be issued in compliance with all
applicable federal and state securities laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Representations and Warranties of the Holder</u>. In connection with the transactions provided for herein,
the Holder hereby represents and warrants to the Company that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Authorization</u>. Holder represents that it has full power and authority to enter into this Warrant. This
Warrant constitutes the Holder's valid and legally binding obligation, enforceable in accordance with its terms, except as may be limited by (i) applicable bankruptcy, insolvency, reorganization, or similar laws relating to or affecting
the enforcement of creditors' rights and (ii) laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Purchase Entirely for Own Account</u>. The Holder acknowledges that this Warrant is entered into by the
Holder in reliance upon such Holder's representation to the Company that the Warrant and the Shares, and any shares of the Company's capital stock issuable upon conversion of the Shares (collectively, the " <u>Securities</u> ")
will be acquired for investment for the Holder's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Holder has no present intention of selling, granting any participation
in or otherwise distributing the same. By acknowledging this Warrant, the Holder further represents that the Holder does not have any contract, undertaking, agreement, or arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Disclosure of Information</u>. The Holder acknowledges that it has received all the information it considers
necessary or appropriate for deciding whether to acquire the Securities. The Holder further represents that it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the
Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Investment Experience</u>. The Holder is an investor in securities of companies in the development stage and
acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the
Securities. If other than an individual, the Holder also represents it has not been organized solely for the purpose of acquiring the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Accredited Investor and Other Matters</u>. The Holder is an "accredited investor" within the
meaning of Rule 501 of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission (the " <u>SEC</u> ") under the Securities Act of 1933 (the " <u>Act</u> "). The Holder is not and none of its
officers, directors, managers, or beneficial equity owners is (i) listed on the Specially Designated Nationals and Blocked persons List (the " <u>SDN List</u> ") maintained by the Office of Foreign Assets Control
(" <u>OFAC</u> "), Department of the Treasury, and/or on any other similar list (collectively with the SDN List, the " <u>Lists</u> ") maintained by the OFAC pursuant to any authorizing statute, Executive Order or

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regulation; or (ii) a person (a "<u>Designated Person</u>") either (A) included within the term "designated national" as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (B) designated under Sections 1(a), 1(b), 1(c) or 1(d) of Executive Order No. 13224, 66 Fed. Reg. 49079 (published September 25, 2001) or similarly designated under any related enabling legislation or any other similar Executive Orders. The Holder's investment in the Company and no dividend or distribution to the Holder shall cause the Company to be in violation of any applicable U.S. federal or state or non-U.S. laws or regulations, including anti-money laundering, sanctions, anti-bribery or anti-boycott laws or regulations, including the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and the Foreign Corrupt Practices Act. The funds utilized to pay the Exercise Price will be paid through an account located in a jurisdiction that does not appear on the list of boycotting countries published by the U.S. Department of Treasury pursuant to Code §999(a)(3), as in effect at the time of such contribution or payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Withholding Taxes</u>. Holder acknowledges that dividends with respect to the Shares may be subject to
applicable withholding requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Restricted Securities</u>. The Holder understands that the Securities are characterized as "restricted
securities" under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without
registration under the Act, only in certain limited circumstances. In this connection, Holder represents that it is familiar with Rule 144, as presently in effect, as promulgated by the SEC under the Act (" <u>Rule 144</u> "), and
understands the resale limitations imposed thereby and by the Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Further Limitations on Disposition</u>. Without in any way limiting the representations set forth above, the
Holder further agrees not to make any disposition of all or any portion of the Shares unless and until the transferee has agreed in writing for the benefit of the Company to be bound by the terms of this Warrant, including, without limitation, this <u>Section 6</u>, <u>Section 25</u>, and:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. there is then in effect a registration statement under the Act covering such proposed disposition and such
disposition is made in accordance with such registration statement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the Holder shall have notified the Company of the proposed disposition and shall have furnished the Company
with a detailed statement of the circumstances surrounding the proposed disposition, and if reasonably requested by the Company, the Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144 except in extraordinary circumstances.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Legends</u>. It is understood that the Securities may bear the following legends:

"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.

THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH SHARES MAY NOT BE SOLD, PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A VALID EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

THE SHARES REPRESENTED HEREBY ARE SUBJECT TO A VOTING AGREEMENT, AS MAY BE AMENDED FROM TIME TO TIME (A COPY OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST FROM THE COMPANY), AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON ACCEPTING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF THAT VOTING AGREEMENT, INCLUDING CERTAIN RESTRICTIONS ON TRANSFER AND OWNERSHIP SET FORTH THEREIN."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Covenants of the Company</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notices of Record Date</u>. In the event of any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend (other than a cash dividend which is the same as cash dividends paid in previous quarters and stock dividends) or other distribution, the
Company shall mail to the Holder, at least ten (10) days prior to such record date, a notice specifying the date on which any such record is to be taken for the purpose of such dividend or distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Covenants as to Exercise Shares</u>. The Company covenants and agrees that all Shares that may be issued
upon the exercise of the rights represented by this Warrant will, upon issuance in accordance with the terms hereof, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the
issuance thereof. The Company further covenants and agrees that the Company will at all times during the Exercise

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Period, have authorized and reserved, free from preemptive rights, a sufficient number of shares of Exercise Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Exercise Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Exercise Stock to such number of shares as shall be sufficient for such purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Adjustment of Exercise Price and Number of Shares</u>. The number and kind of Shares purchasable upon
exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Subdivisions, Combinations and Other Issuances</u>. If the Company shall at any time after the issuance but
prior to the expiration of this Warrant subdivide its Exercise Stock, by split-up or otherwise, or combine its Exercise Stock, or issue additional shares of its capital stock as a dividend with respect to any
shares of its Exercise Stock, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination.
Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate Exercise Price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this <u>Section 8(a)</u> shall become effective at the close of business on the date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon the making of such
dividend.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Reclassification, Reorganization and Consolidation</u>. In case of any reclassification, capital
reorganization or change in the capital stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in <u>Section 8(a)</u> above), then, as a condition of such reclassification, reorganization or
change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall have the right at any time prior to the expiration of this Warrant
to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities or property receivable in connection with such reclassification, reorganization or change by a holder
of the same number and type of securities as were purchasable as Shares by the Holder immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interest
of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price per
Share payable hereunder, <u>provided</u> the aggregate Exercise Price shall remain the same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Notice of Adjustment</u>. When any adjustment is required to be made in the number or kind of shares
purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of Shares or other securities or property thereafter purchasable upon exercise of this Warrant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Conversion of Exercise Stock</u>. In the event that all outstanding shares of Exercise Stock are converted
to another series or class of the Company's capital stock, or any other security, in accordance with the terms of the Certificate of Incorporation in connection with the Company's Initial Public Offering, Sale Event or other event, this
Warrant shall become exercisable for such other security.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant, and in lieu of such fractional shares, the number of Shares issued upon the exercise of this Warrant shall be rounded down to the nearest whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>No Stockholder Rights</u>. Prior to exercise of this Warrant, the Holder shall not be entitled to any rights
of a stockholder with respect to the Shares, including (without limitation) the right to vote such Shares, receive dividends or other distributions thereon, exercise preemptive rights or be notified of stockholder meetings, and, except as otherwise
provided in this Warrant, such Holder shall not be entitled to any stockholder notice or other communication concerning the business or affairs of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>Replacement of the Warrant</u>. Subject to the receipt of evidence reasonably satisfactory to the Company of
the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and substance to the Company or, in the case of mutilation, on surrender
and cancellation of this Warrant, the Company at the expense of the Holder shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor and amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Transfer of Warrant</u>. Subject to (a) any restrictions on transfer set forth herein, and
(b) compliance with applicable federal and state securities laws and any other contractual restrictions between the Company and the Holder contained herein, this Warrant, all rights hereunder, and the Shares which are issuable pursuant to an
exercise of this Warrant. are transferable in whole or in part by the Holder to any person or entity upon written notice to the Company. Within a reasonable time after the Company's receipt of an executed Assignment Form in the form attached
hereto, the transfer shall be recorded on the books of the Company upon the surrender of this Warrant, properly endorsed, to the Company, and the payment to the Company of all transfer taxes and other governmental charges imposed on such transfer.
In the event of a partial transfer, the Company shall issue to the new holders one (1) or more appropriate new warrants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>No Public Market</u>. The Holder understands and acknowledges that no public market now exists for any of
the securities issued by the Company and that the Company has made no assurances that a public market will ever exist for the Company's securities.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Legal Counsel</u>. The Holder has had the opportunity to review this Warrant, the exhibits and schedules
attached hereto and the transactions contemplated by this Warrant with its own legal counsel. The Holder is not relying on any statements or representations of the Company or its agents for legal advice with respect to this investment or the
transactions contemplated by this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. <u>Tax Advisors</u>. The Holder has reviewed with its own tax advisors the U.S. federal, state and local and non-U.S. tax consequences of this investment and the transactions contemplated by this Warrant. With respect to such matters, the Holder relies solely on any such advisors and not on any statements or
representations of the Company or any of its agents, written or oral. The Holder understands that it (and not the Company) shall be responsible for its own tax liability that may arise as a result of this investment and the transactions contemplated
by this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. <u>Governing Law</u>. This Warrant shall be governed by and construed under the laws of the State of Delaware
as applied to agreements among Delaware residents, made and to be performed entirely within the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. <u>Successors and Assigns</u>. The terms and provisions of this Warrant shall inure to the benefit of, and be
binding upon, the Company and the holders hereof and their respective successors and assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. <u>Titles and Subtitles</u>. The titles and subtitles used in this Warrant are used for convenience only and
are not to be considered in construing or interpreting this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. <u>Notices</u>. All notices and other communications given or made pursuant hereto shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, and if not so confirmed, then on the
next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All communications shall be sent to the respective parties at the following addresses (or at such other addresses as shall be specified by notice given in accordance with this Section 19):

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If to the Company:

210 Carnegie Center, Suite 103

Princeton, NJ 08540

Attention: Chief Executive Officer

With a copy to:

Goodwin Procter LLP

100 Northern Avenue

Boston, MA 02210

Attention: Mitch Bloom and Rob Dzialo

If to Holder:

At the addresses shown on the signature pages hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. <u>Confidentiality</u>. Holder shall treat and hold as confidential any information concerning this Warrant and
the business or affairs of the Company in accordance with Section 3.6 of the Company's Amended and Restated Investors' Rights Agreement, dated September 4, 2025 (the " <u>IRA</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. <u>Finder's Fee</u>. Each party represents that it neither is or will be obligated for any finder's
fee or commission in connection with this transaction. The Holder agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder's fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Holder or any of its officers, partners, employees or representatives is responsible. The Company agrees to indemnify and hold harmless the Holder from any liability for any
commission or compensation in the nature of a finder's fee (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. <u>Expenses</u>. If any action at law or in equity is necessary to enforce or interpret the terms of this
Warrant, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23. <u>Entire Agreement; Amendments and Waivers</u>. This Warrant, any other documents delivered pursuant hereto
and the Purchase Agreement constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Nonetheless, any term of this Warrant may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of the Company and the Holder; or if this Warrant has been assigned in part, by the holders or rights to
purchase a majority of the shares originally issuable pursuant to this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24. <u>Severability</u>. If any provision of this Warrant is held to be unenforceable under applicable law, such
provision shall be excluded from this Warrant and the balance of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25. <u>"Market Stand-Off" Agreement</u>. The Holder hereby
agrees that this Warrant shall be subject to the terms and conditions of Section 2.11 of the IRA.

IN WITNESS WHEREOF, the parties have executed this Warrant as of the date first written above.

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| | |
|:---|:---|
| **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: | /s/ Tassos Gianakakos |
| Name: Tassos Gianakakos | Name: Tassos Gianakakos |
| Title: President and Chief Executive Officer | Title: President and Chief Executive Officer |

---

------

---

| | |
|:---|:---|
| **ACKNOWLEDGED AND AGREED:** | **ACKNOWLEDGED AND AGREED:** |
| **HOLDER** | **HOLDER** |
| **ARCH VENTURE FUND XIII, L.P.** | **ARCH VENTURE FUND XIII, L.P.** |
| By: ARCH Venture Partners XIII, L.P., its General Partner | By: ARCH Venture Partners XIII, L.P., its General Partner |
| By: ARCH Venture Partners XIII, LLC, its General Partner | By: ARCH Venture Partners XIII, LLC, its General Partner |
| By: | /s/ Mark McDonnell |
| Name: Mark McDonnell | Name: Mark McDonnell |
| Title: Managing Director | Title: Managing Director |

---

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**<u>NOTICE OF EXERCISE</u>**

**KARDIGAN, INC.** 

Attention: Corporate Secretary

The undersigned hereby elects to purchase, pursuant to the provisions of the Warrant, as follows:

❑ _____________ shares of Exercise Stock pursuant to the terms of the attached Warrant, and tenders herewith payment in cash of the Exercise Price of such Shares in full, together with all applicable transfer taxes, if any.

❑ Net Exercise the attached Warrant with respect to __________ Shares.

The undersigned hereby represents and warrants that Representations and Warranties in <u>Section</u> <u>6</u> hereof are true and correct as of the date hereof.

---

| | |
|:---|:---|
|  | **HOLDER:** |
| Date:___________________ | By: |
| Address: |  |
| Name in which shares should be registered: |  |

---

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**<u>ASSIGNMENT FORM</u>**

(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

**FOR VALUE RECEIVED**, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

Name: <br> (Please Print)

Address: <br> (Please Print)

Dated: _________________

Holder's

Signature:

Holder's

Address:<u> </u>

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**NOTE**: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant. Officers of corporations and those acting in a fiduciary or other representative capacity should provide proper evidence of authority to assign the foregoing Warrant.

## Exhibit 4.3

**Exhibit 4.3** 

THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT. 

Date of Issuance: September 4, 2025

**KARDIGAN, INC.** 

**WARRANT TO PURCHASE SHARES OF COMMON STOCK** 

For value received in connection with the Holder (as defined below)'s purchase of Series B Preferred Stock of the Company (as defined below) pursuant to that certain Series B Preferred Stock Purchase Agreement, dated September 4, 2025, the receipt and sufficiency of which is hereby acknowledged, this Warrant (the "<u>Warrant</u>") is issued to **SCHF (M) PV, L.P.** (together with such holder's assigns in accordance with the terms of this Warrant, the "<u>Holder</u>") by **Kardigan, Inc.** (the "<u>Company</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Purchase of Shares</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Number of Shares</u>. Subject to the terms and conditions set forth herein (including as set forth in <u>Section 2(a)</u> below), the Holder is entitled to purchase from the Company up to 550,000 fully paid and nonassessable shares of Exercise Stock (as defined below) subject to adjustment pursuant to <u>Section 8</u> hereof (the
" <u>Shares</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Exercise Price</u>. The exercise price for the Shares shall be $21.36508 per share (the " <u>Exercise Price</u> "). The Shares and the Exercise Price shall be subject to adjustment pursuant to <u>Section 8</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Type of Shares</u>. The Shares issuable upon exercise of this Warrant shall be shares of the
Company's Common Stock (the " <u>Exercise Stock</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise Period</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Warrant shall be exercisable, in whole or in part, only upon the first date the Company achieves a
Valuation (as defined below) of $5,000,000,000 (as reasonably determined by the Company's Board of Directors (the " <u>Board</u> ")) and ending at 5:00 p.m. E.T. on the tenth anniversary of the Date of Issuance (the
" <u>Exercise Period</u> ") . Notwithstanding anything to the contrary contained herein, if any of the vesting

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milestones set forth in the CEO Grant with respect to a Valuation equal to or in excess of $5,000,000,000 are accelerated by the Board without the achievement of such vesting Valuation milestone(s) in accordance with the terms of the CEO Grant, then the $5,000,000,000 Valuation shall also be deemed achieved for purposes of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Definitions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. " <u>CEO Grant</u> " means that certain Early Exercise Non-Qualified Stock Option Agreement under the Plan issued to Tassos Gianakakos dated on or about September 4, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. " <u>Certificate of Incorporation</u> " means the Company's Amended and Restated Certificate of
Incorporation, as may be amended and/or restated from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. " <u>Consideration</u> " means the value of cash and/or non-cash property (including equity securities, notes and other similar non-cash property) received by holders of Securities in a Sale Event. For the purposes hereof, non-cash property shall be valued in good faith by the Board including the then-seated Preferred Directors (as defined in the Certificate of Incorporation). For the purpose of calculating the amount of Consideration
received by holders of Securities, such holders shall be deemed to have received Holdback Proceeds only when and if such Holdback Proceeds are actually paid to such holders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. " <u>Holdback Proceeds</u> " means any portion of the aggregate value of the Consideration that
(i) is payable following the closing of a Sale Event, (ii) is contingent upon the performance of the Company or its assets, and/or attainment of financial targets, milestones, or other performance metrics or milestones following the
consummation of a Sale Event, including royalty payments and/or (iii) is held in an escrow fund or otherwise held back for indemnification, purchase price adjustment or other claims.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. " <u>Fully Diluted Valuation</u> " means (i) the Last Round Price <u>multiplied by</u> (ii) the number of Securities issued and outstanding (determined on an as-converted, as-exercised or as-exchanged to Common
Stock basis) treating all shares of Common Stock reserved and available for issuance under the Plan or other equity incentive plan or arrangement as issued and outstanding (only to the extent such shares of Common Stock reserved and available for
issuance were reserved for issuance prior to or at the time of the Company's last bona fide equity financing for the principal purpose of raising capital).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. " <u>Last Round Price</u> " means the cash price per share for which the Company last sold its
preferred stock (on an as-converted to Common Stock basis) in a bona fide equity financing for the principal purpose of raising capital.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. " <u>Market Capitalization</u> " means (i) the number of Securities issued and outstanding
(determined on an as-converted, as-exercised or as-exchanged to Common Stock basis) <u>multiplied by</u> (ii) the VWAP of a
share of Common Stock over the preceding thirty (30) day consecutive calendar period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;viii. " <u>Person</u> " shall mean any individual, corporation, partnership (limited or general), limited
liability company, limited liability partnership, association, trust, joint venture, unincorporated organization or any similar entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ix. " <u>Plan</u> " shall mean the Company's Amended and Restated 2023 Stock Option and Grant Plan,
as amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;x. " <u>Purchase Agreement</u> " shall mean the Company's Series B Preferred Stock Purchase
Agreement dated September 4, 2025 by and among the Company and the investors listed on Exhibit A thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xi. " <u>Sale Event</u> *"* shall mean a Deemed Liquidation Event as such term is defined in the
Certificate of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xii. " <u>Securities</u> " means the Company's capital stock and stock options, warrants, and other
securities directly or indirectly convertible into, exercisable for or exchangeable for shares of Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xiii. " <u>Termination Event</u> " means (a) the consummation of a Sale Event or (b) any
voluntary or involuntary liquidation, dissolution or winding up of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xiv. " <u>Valuation</u> " shall be measured as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. in the case of a Sale Event, the aggregate Consideration received (whether at the closing or following the
closing of such Sale Event) by holders of Securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. at any time prior to the Company's Initial Public Offering, the Fully Diluted Valuation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. at any time after the Company's Initial Public Offering, the Market Capitalization.

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All determinations of the Valuation shall be reasonably determined by the Board. Any determination by the Board regarding the Valuation shall be consistent with the determination of the Valuation (as defined in the CEO Grant) as set forth in the CEO Grant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;xv. " <u>VWAP</u> " means the volume weighted average trading price of Common Stock as reported by
Bloomberg, L.P. (which VWAP, if calculated for a multi-day period, shall be based on all trades during the primary trading session from 9:30 a.m., New York City time, to the time of the closing print on the
primary exchange of the Company (or its successor entity, if any) but in no case later than 4:10 p.m. New York City time for such period, and not an average of daily averages) or, if not reported therein, in another authoritative source mutually
selected by the Holder and the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Method of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) While this Warrant remains outstanding and is exercisable in accordance with <u>Section 2</u> above, the
Holder may exercise, in whole or in part, to the extent then exercisable, the purchase rights evidenced hereby. Such exercise shall be effected by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. the surrender of the Warrant, together with a duly executed copy of the Notice of Exercise attached hereto, to
the Company at its principal office (or at such other place as the Company shall notify the Holder in writing); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the payment to the Company of an amount equal to the aggregate Exercise Price for the number of Shares being
purchased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business
on the day on which this Warrant is surrendered to the Company as provided in <u>Section 3(a)</u> above. At such time, the person or persons in whose name or names any certificate for the Shares shall be issuable upon such exercise as provided
in <u>Section 3(c)</u> below shall be deemed to have become the holder or holders of record of the Shares represented by such certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the exercise of the rights represented by this Warrant, a book entry or other evidence for the Shares so
purchased, registered in the name of the Holder or persons affiliated with the Holder, if the Holder so designates (upon payment by such Holder of any applicable transfer taxes and subject to the assignment restrictions hereof), shall be issued and
delivered to the Holder within a reasonable time after the rights represented by this Warrant shall have been so exercised. If this Warrant is exercised for fewer than all of the Shares, the Company shall issue to the Holder a new Warrant on
identical terms reflecting the remainder of the Shares.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Company shall provide written notice to the Holder at least ten (10) business days prior to the
consummation of a Termination Event. Notwithstanding the provisions of <u>Section 2</u>, in the event that the Company fails to provide such notice or if the holder has not exercised this Warrant prior to the closing of a Termination Event,
this Warrant shall automatically be deemed to be exercised to the extent exercisable in full in the manner set forth in <u>Section 4</u>, without any further action on behalf of the Holder immediately prior to such closing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Notwithstanding the foregoing or anything to the contrary in this Warrant, if Holder, along with the Notice of
Exercise, notifies the Company that a filing under the Hart-Scott-Rodino Act of 1976, as amended (the " <u>HSR Act</u> ") may be required in connection with the proposed exercise of this Warrant, then the Company shall provide Holder with
such information as may be reasonably requested so that Holder may make a final determination of whether a filing is required. If Holder determines that an HSR Act filing is required, then the parties shall follow the procedures set forth herein and
no Shares shall be issued under this Warrant to Holder pursuant to the applicable Notice of Exercise until the applicable waiting period under the HSR Act has expired or been earlier terminated and this Warrant shall not terminate under any
circumstances until such issuance of such Shares has been completed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. If Holder determines that an HSR Act filing is required pursuant to <u>Section 3(e)</u>, then each of the
Company and Holder shall, as promptly as practicable, file with the United States Federal Trade Commission (the " <u>FTC</u> ") and Department of Justice Antitrust Division (the " <u>DOJ</u> ") an appropriate and complete
Notification and Report Form (the " <u>HSR Act Filings</u> "). The HSR Act Filings shall request early termination of the applicable waiting period under the HSR Act. Each of the Company and Holder shall, and shall cause its affiliates to,
furnish to the other party such necessary information (to the extent consistent with any applicable law) and reasonable assistance as the other party may request to determine whether an HSR Act Filing is required and in connection with its
preparation of the HSR Act Filings. Each of the Company and Holder shall, and shall cause its affiliates to, keep the other party apprised of the status of any communications by such party or any of its affiliates with, and any inquiries or requests
for additional information from, the FTC, the DOJ or any other governmental entity with respect to the HSR Act Filings or the transactions reported therein. Each of the Company and Holder shall, and the Company shall cause its affiliates to, comply
as promptly as practicable with any such inquiry or request and provide any supplemental information requested in connection with the HSR Act Filings or pursuant to any other applicable law. No party hereto or any of their respective affiliates
shall participate in any meeting or engage in any substantive conversation with any governmental entity with respect to the HSR Act Filings or transactions reported therein without giving the other party prior notice of the

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meeting or conversation. Any such provisions of information, rights to participate or consultations between the parties may be made on a counsel-only or outside counsel-only basis to the extent required under applicable law or as appropriate to protect sensitive business information or maintain attorney-client or other privilege. Notwithstanding anything in this Warrant to the contrary, if Holder has notified the Company that an HSR Act filing is required, then no Shares shall be issued under this Warrant to Holder until the applicable waiting period under the HSR Act has expired or been earlier terminated and this Warrant shall not terminate until such issuance has been completed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Net Exercise</u>. In lieu of exercising this Warrant with cash, the Holder may elect to receive shares equal
to the value of this Warrant (or the portion thereof being exercised) by surrender of this Warrant to the Company together with notice of such election (a " <u>Net Exercise</u> "). A Holder who Net Exercises shall have the rights described
in <u>Sections 3(b)</u> and <u>3(c)</u> hereof, and the Company shall issue to such Holder a number of Shares computed using the following formula:

![LOGO](g107928dsp52.jpg)

Where

X = The number of Shares to be issued to the Holder.

Y = The number of Shares purchasable and exercisable under this Warrant or, if only a portion of the Warrant is being exercised, the portion of the Warrant being exercised (at the date of such calculation).

A = The fair market value of one (1) Share (at the date of such calculation).

B = The Exercise Price (as adjusted to the date of such calculation).

For purposes of this <u>Section 4</u>, the fair market value of a Share shall mean the average of the closing prices of the Shares quoted in the over-the-counter market in which the Shares are traded or the closing price quoted on any exchange or electronic securities market on which the Shares are listed, whichever is applicable, as published in *The Wall Street Journal* for the thirty (30) trading days prior to the date of determination of fair market value (or such shorter period of time during which such Shares were traded over-the-counter or on such exchange). In the event that this Warrant is exercised pursuant to this <u>Section 4</u> in connection with the Company's first firm commitment underwritten public offering (the "<u>Initial Public Offering</u>"), the fair market value per Share shall be the per share offering price to the public of the Initial Public Offering. If the Shares are not traded on the over-the-counter market, an exchange or an electronic securities market, the fair market value shall be the highest price per Share that the Company could obtain from a willing buyer for Shares sold by the Company from authorized but unissued Shares, as determined in good faith by the Board, unless the Company is at such time subject to a Sale Event, in which case the fair market value of Warrant Stock shall be deemed to be the Consideration received by the holders of such stock pursuant to such Sale Event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Representations and Warranties of the Company</u>. In connection with the transactions provided for herein,
the Company hereby represents and warrants to the Holder that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Stock Purchase Agreement</u>. The Company expressly acknowledges and agrees that the representations and
warranties made by the Company in Section 2 of the Purchase Agreement, as qualified by the disclosures set forth in the Disclosure Schedule (as defined in the Purchase Agreement), are hereby incorporated and made a part of this Warrant, *mutatis mutandis*, in respect of the Company's issuance of the Warrant (and the underlying Shares) to the Holder; provided, that such representations and warranties are made as of the date hereof except as otherwise indicated in the
Purchase Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Organization, Good Standing, and Qualification</u>. The Company is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted. The Company is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse effect on its business or properties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Authorization</u>. Except as may be limited by applicable bankruptcy, insolvency, reorganization or similar
laws relating to or affecting the enforcement of creditors' rights, all corporate action has been taken on the part of the Company, its officers, directors, and stockholders necessary for the authorization, execution and delivery of this
Warrant. The Company has taken all corporate action required to make all the obligations of the Company reflected in the provisions of this Warrant the valid and enforceable obligations they purport to be. The issuance of this Warrant will not be
subject to preemptive rights of any stockholders of the Company. The Company has authorized sufficient shares of Exercise Stock to allow for the exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Compliance with Other Instruments</u>. The authorization, execution and delivery of the Warrant will not
constitute or result in a material default or violation of any law or regulation applicable to the Company or any material term or provision of the Certificate of Incorporation or bylaws, or any material agreement or instrument by which it is bound
or to which its properties or assets are subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Valid Issuance of Shares</u>. The Shares, when issued, sold, and delivered in accordance with the terms of
this Warrant for the consideration expressed therein, will be duly and validly issued, fully paid and nonassessable and, based in part upon the representations and warranties of the Holders in this Warrant, will be issued in compliance with all
applicable federal and state securities laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Representations and Warranties of the Holder</u>. In connection with the transactions provided for herein,
the Holder hereby represents and warrants to the Company that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Authorization</u>. Holder represents that it has full power and authority to enter into this Warrant. This
Warrant constitutes the Holder's valid and legally binding obligation, enforceable in accordance with its terms, except as may be limited by (i) applicable bankruptcy, insolvency, reorganization, or similar laws relating to or affecting
the enforcement of creditors' rights and (ii) laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Purchase Entirely for Own Account</u>. The Holder acknowledges that this Warrant is entered into by the
Holder in reliance upon such Holder's representation to the Company that the Warrant and the Shares, and any shares of the Company's capital stock issuable upon conversion of the Shares (collectively, the " <u>Securities</u> ")
will be acquired for investment for the Holder's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Holder has no present intention of selling, granting any participation
in or otherwise distributing the same. By acknowledging this Warrant, the Holder further represents that the Holder does not have any contract, undertaking, agreement, or arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Disclosure of Information</u>. The Holder acknowledges that it has received all the information it considers
necessary or appropriate for deciding whether to acquire the Securities. The Holder further represents that it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the
Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Investment Experience</u>. The Holder is an investor in securities of companies in the development stage and
acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of the investment in the
Securities. If other than an individual, the Holder also represents it has not been organized solely for the purpose of acquiring the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Accredited Investor and Other Matters</u>. The Holder is an "accredited investor" within the
meaning of Rule 501 of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission (the " <u>SEC</u> ") under the Securities Act of 1933 (the " <u>Act</u> "). The Holder is not and none of its
officers, directors, managers, or beneficial equity owners is (i) listed on the Specially Designated Nationals and Blocked persons List (the " <u>SDN List</u> ") maintained by the Office of Foreign Assets Control
(" <u>OFAC</u> "), Department of the Treasury, and/or on any other similar list (collectively with the SDN List, the " <u>Lists</u> ") maintained by the OFAC pursuant to any authorizing statute, Executive Order or

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regulation; or (ii) a person (a "<u>Designated Person</u>") either (A) included within the term "designated national" as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (B) designated under Sections 1(a), 1(b), 1(c) or 1(d) of Executive Order No. 13224, 66 Fed. Reg. 49079 (published September 25, 2001) or similarly designated under any related enabling legislation or any other similar Executive Orders. The Holder's investment in the Company and no dividend or distribution to the Holder shall cause the Company to be in violation of any applicable U.S. federal or state or non-U.S. laws or regulations, including anti-money laundering, sanctions, anti-bribery or anti-boycott laws or regulations, including the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001, and the Foreign Corrupt Practices Act. The funds utilized to pay the Exercise Price will be paid through an account located in a jurisdiction that does not appear on the list of boycotting countries published by the U.S. Department of Treasury pursuant to Code §999(a)(3), as in effect at the time of such contribution or payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Withholding Taxes</u>. Holder acknowledges that dividends with respect to the Shares may be subject to
applicable withholding requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Restricted Securities</u>. The Holder understands that the Securities are characterized as "restricted
securities" under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without
registration under the Act, only in certain limited circumstances. In this connection, Holder represents that it is familiar with Rule 144, as presently in effect, as promulgated by the SEC under the Act (" <u>Rule 144</u> "), and
understands the resale limitations imposed thereby and by the Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Further Limitations on Disposition</u>. Without in any way limiting the representations set forth above, the
Holder further agrees not to make any disposition of all or any portion of the Shares unless and until the transferee has agreed in writing for the benefit of the Company to be bound by the terms of this Warrant, including, without limitation, this <u>Section 6</u>, <u>Section 25</u>, and:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. there is then in effect a registration statement under the Act covering such proposed disposition and such
disposition is made in accordance with such registration statement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the Holder shall have notified the Company of the proposed disposition and shall have furnished the Company
with a detailed statement of the circumstances surrounding the proposed disposition, and if reasonably requested by the Company, the Holder shall have furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the Act. It is agreed that the Company will not require opinions of counsel for transactions made pursuant to Rule 144 except in extraordinary circumstances.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Legends . It is understood that the Securities may bear the following legends:

"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144 UNDER SUCH ACT.

THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH SHARES MAY NOT BE SOLD, PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A VALID EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

THE SHARES REPRESENTED HEREBY ARE SUBJECT TO A VOTING AGREEMENT, AS MAY BE AMENDED FROM TIME TO TIME (A COPY OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST FROM THE COMPANY), AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON ACCEPTING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE PROVISIONS OF THAT VOTING AGREEMENT, INCLUDING CERTAIN RESTRICTIONS ON TRANSFER AND OWNERSHIP SET FORTH THEREIN."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Covenants of the Company</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notices of Record Date</u>. In the event of any taking by the Company of a record of the holders of any
class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend (other than a cash dividend which is the same as cash dividends paid in previous quarters and stock dividends) or other distribution, the
Company shall mail to the Holder, at least ten (10) days prior to such record date, a notice specifying the date on which any such record is to be taken for the purpose of such dividend or distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Covenants as to Exercise Shares</u>. The Company covenants and agrees that all Shares that may be issued
upon the exercise of the rights represented by this Warrant will, upon issuance in accordance with the terms hereof, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the
issuance thereof. The Company further covenants and agrees that the Company will at all times during the Exercise

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Period, have authorized and reserved, free from preemptive rights, a sufficient number of shares of Exercise Stock to provide for the exercise of the rights represented by this Warrant. If at any time during the Exercise Period the number of authorized but unissued shares of Exercise Stock shall not be sufficient to permit exercise of this Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Exercise Stock to such number of shares as shall be sufficient for such purposes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Adjustment of Exercise Price and Number of Shares</u>. The number and kind of Shares purchasable upon
exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Subdivisions, Combinations and Other Issuances</u>. If the Company shall at any time after the issuance but
prior to the expiration of this Warrant subdivide its Exercise Stock, by split-up or otherwise, or combine its Exercise Stock, or issue additional shares of its capital stock as a dividend with respect to any
shares of its Exercise Stock, the number of Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or proportionately decreased in the case of a combination.
Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate Exercise Price payable for the total number of Shares purchasable under this Warrant (as adjusted) shall remain the same. Any adjustment under this <u>Section 8(a)</u> shall become effective at the close of business on the date the subdivision or combination becomes effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon the making of such
dividend.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Reclassification, Reorganization and Consolidation</u>. In case of any reclassification, capital
reorganization or change in the capital stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for in <u>Section 8(a)</u> above), then, as a condition of such reclassification, reorganization or
change, lawful provision shall be made, and duly executed documents evidencing the same from the Company or its successor shall be delivered to the Holder, so that the Holder shall have the right at any time prior to the expiration of this Warrant
to purchase, at a total price equal to that payable upon the exercise of this Warrant, the kind and amount of shares of stock and other securities or property receivable in connection with such reclassification, reorganization or change by a holder
of the same number and type of securities as were purchasable as Shares by the Holder immediately prior to such reclassification, reorganization or change. In any such case appropriate provisions shall be made with respect to the rights and interest
of the Holder so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities or property deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price per
Share payable hereunder, <u>provided</u> the aggregate Exercise Price shall remain the same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Notice of Adjustment</u>. When any adjustment is required to be made in the number or kind of shares
purchasable upon exercise of the Warrant, or in the Exercise Price, the Company shall promptly notify the Holder of such event and of the number of Shares or other securities or property thereafter purchasable upon exercise of this Warrant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Conversion of Exercise Stock</u>. In the event that all outstanding shares of Exercise Stock are converted
to another series or class of the Company's capital stock, or any other security, in accordance with the terms of the Certificate of Incorporation in connection with the Company's Initial Public Offering, Sale Event or other event, this
Warrant shall become exercisable for such other security.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be
issued upon the exercise of this Warrant, and in lieu of such fractional shares, the number of Shares issued upon the exercise of this Warrant shall be rounded down to the nearest whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>No Stockholder Rights</u>. Prior to exercise of this Warrant, the Holder shall not be entitled to any rights
of a stockholder with respect to the Shares, including (without limitation) the right to vote such Shares, receive dividends or other distributions thereon, exercise preemptive rights or be notified of stockholder meetings, and, except as otherwise
provided in this Warrant, such Holder shall not be entitled to any stockholder notice or other communication concerning the business or affairs of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>Replacement of the Warrant</u>. Subject to the receipt of evidence reasonably satisfactory to the Company of
the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and substance to the Company or, in the case of mutilation, on surrender
and cancellation of this Warrant, the Company at the expense of the Holder shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor and amount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Transfer of Warrant</u>. Subject to (a) any restrictions on transfer set forth herein, and
(b) compliance with applicable federal and state securities laws and any other contractual restrictions between the Company and the Holder contained herein, this Warrant, all rights hereunder, and the Shares which are issuable pursuant to an
exercise of this Warrant. are transferable in whole or in part by the Holder to any person or entity upon written notice to the Company. Within a reasonable time after the Company's receipt of an executed Assignment Form in the form attached
hereto, the transfer shall be recorded on the books of the Company upon the surrender of this Warrant, properly endorsed, to the Company, and the payment to the Company of all transfer taxes and other governmental charges imposed on such transfer.
In the event of a partial transfer, the Company shall issue to the new holders one (1) or more appropriate new warrants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>No Public Market</u>. The Holder understands and acknowledges that no public market now exists for any of
the securities issued by the Company and that the Company has made no assurances that a public market will ever exist for the Company's securities.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Legal Counsel</u>. The Holder has had the opportunity to review this Warrant, the exhibits and schedules
attached hereto and the transactions contemplated by this Warrant with its own legal counsel. The Holder is not relying on any statements or representations of the Company or its agents for legal advice with respect to this investment or the
transactions contemplated by this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. <u>Tax Advisors</u>. The Holder has reviewed with its own tax advisors the U.S. federal, state and local and non-U.S. tax consequences of this investment and the transactions contemplated by this Warrant. With respect to such matters, the Holder relies solely on any such advisors and not on any statements or
representations of the Company or any of its agents, written or oral. The Holder understands that it (and not the Company) shall be responsible for its own tax liability that may arise as a result of this investment and the transactions contemplated
by this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. <u>Governing Law</u>. This Warrant shall be governed by and construed under the laws of the State of Delaware
as applied to agreements among Delaware residents, made and to be performed entirely within the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. <u>Successors and Assigns</u>. The terms and provisions of this Warrant shall inure to the benefit of, and be
binding upon, the Company and the holders hereof and their respective successors and assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. <u>Titles and Subtitles</u>. The titles and subtitles used in this Warrant are used for convenience only and
are not to be considered in construing or interpreting this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. <u>Notices</u>. All notices and other communications given or made pursuant hereto shall be in writing and
shall be deemed effectively given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, and if not so confirmed, then on the
next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day
delivery, with written verification of receipt. All communications shall be sent to the respective parties at the following addresses (or at such other addresses as shall be specified by notice given in accordance with this <u>Section 19</u>):

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If to the Company:

210 Carnegie Center, Suite 103

Princeton, NJ 08540

Attention: Chief Executive Officer

With a copy to:

Goodwin Procter LLP

100 Northern Avenue

Boston, MA 02210

Attention: Mitch Bloom and Rob Dzialo

If to Holder:

At the addresses shown on the signature pages hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. <u>Confidentiality</u>. Holder shall treat and hold as confidential any information concerning this Warrant and
the business or affairs of the Company in accordance with Section 3.6 of the Company's Amended and Restated Investors' Rights Agreement, dated September 4, 2025 (the " <u>IRA</u> ").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. <u>Finder's Fee</u>. Each party represents that it neither is or will be obligated for any finder's
fee or commission in connection with this transaction. The Holder agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder's fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Holder or any of its officers, partners, employees or representatives is responsible. The Company agrees to indemnify and hold harmless the Holder from any liability for any
commission or compensation in the nature of a finder's fee (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. <u>Expenses</u>. If any action at law or in equity is necessary to enforce or interpret the terms of this
Warrant, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other relief to which such party may be entitled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23. <u>Entire Agreement; Amendments and Waivers</u>. This Warrant, any other documents delivered pursuant hereto
and the Purchase Agreement constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and thereof. Nonetheless, any term of this Warrant may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), with the written consent of the Company and the Holder; or if this Warrant has been assigned in part, by the holders or rights to
purchase a majority of the shares originally issuable pursuant to this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24. <u>Severability</u>. If any provision of this Warrant is held to be unenforceable under applicable law, such
provision shall be excluded from this Warrant and the balance of the Warrant shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25. " <u>Market Stand-Off" Agreement</u>. The Holder hereby
agrees that this Warrant shall be subject to the terms and conditions of Section 2.11 of the IRA.

IN WITNESS WHEREOF, the parties have executed this Warrant as of the date first written above.

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| | |
|:---|:---|
| **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: | /s/ Tassos Gianakakos |
| Name: Tassos Gianakakos | Name: Tassos Gianakakos |
| Title: President and Chief Executive Officer | Title: President and Chief Executive Officer |

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| | |
|:---|:---|
| **ACKNOWLEDGED AND AGREED:** | **ACKNOWLEDGED AND AGREED:** |
| **HOLDER** | **HOLDER** |
| **SCHF (M) PV, L.P.** | **SCHF (M) PV, L.P.** |
| By: SCHF (GPE), LLC, its General Partner | By: SCHF (GPE), LLC, its General Partner |
| By: | /s/ Kevin Kelly |
| Name: Kevin Kelly | Name: Kevin Kelly |
| Title: Managing Member | Title: Managing Member |

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**<u>NOTICE OF EXERCISE</u>**

**KARDIGAN, INC.** 

Attention: Corporate Secretary

The undersigned hereby elects to purchase, pursuant to the provisions of the Warrant, as follows:

❑ _____________ shares of Exercise Stock pursuant to the terms of the attached Warrant, and tenders herewith payment in cash of the Exercise Price of such Shares in full, together with all applicable transfer taxes, if any.

❑ Net Exercise the attached Warrant with respect to __________ Shares.

The undersigned hereby represents and warrants that Representations and Warranties in <u>Section</u> <u>6</u> hereof are true and correct as of the date hereof.

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| | | |
|:---|:---|:---|
|  |  | **HOLDER:** |
| Date:___________________ |  | By: |
|  | Address: |  |

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Name in which shares should be registered:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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**<u>ASSIGNMENT FORM</u>**

(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

**FOR VALUE RECEIVED**, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

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| | |
|:---|:---|
| Name: |  |
|  | (Please Print) |
| Address: |  |
|  | (Please Print) |

---

Dated: _________________

Holder's

Signature:<u> </u>

Holder's

Address:

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**NOTE**: The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant. Officers of corporations and those acting in a fiduciary or other representative capacity should provide proper evidence of authority to assign the foregoing Warrant.

## Exhibit 10.1

**Exhibit 10.1** 

**ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

SECTION 1. <u>GENERAL PURPOSE OF THE PLAN; DEFINITIONS</u>

The name of the plan is the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"). The purpose of the Plan is to encourage and enable the officers, employees, directors, Consultants and other key persons of EnCarda, Inc., a Delaware corporation (including any successor entity, the "<u>Company</u>") and its Subsidiaries, upon whose judgment, initiative and efforts the Company largely depends for the successful conduct of its business, to acquire a proprietary interest in the Company.

The following terms shall be defined as set forth below:

"*Affiliate*" of any Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with the first mentioned Person. A Person shall be deemed to control another Person if such first Person possesses directly or indirectly the power to direct, or cause the direction of, the management and policies of the second Person, whether through the ownership of voting securities, by contract or otherwise.

"*Award*" or "*Awards,*" except where referring to a particular category of grant under the Plan, shall include Incentive Stock Options, Non-Qualified Stock Options, Restricted Stock Awards, Unrestricted Stock Awards, Restricted Stock Units or any combination of the foregoing.

*"Award Agreement"* means a written or electronic agreement setting forth the terms and provisions applicable to an Award granted under the Plan. Each Award Agreement may contain terms and conditions in addition to those set forth in the Plan; *provided, however,* in the event of any conflict in the terms of the Plan and the Award Agreement, the terms of the Plan shall govern**.**

"*Board*" means the Board of Directors of the Company.

"*Cause*" shall have the meaning as set forth in the Award Agreement(s). In the case that any Award Agreement does not contain a definition of "Cause," it shall mean (i) the grantee's dishonest statements or acts with respect to the Company or any Affiliate of the Company, or any current or prospective customers, suppliers vendors or other third parties with which such entity does business; (ii) the grantee's commission of (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud; (iii) the grantee's failure to perform his assigned duties and responsibilities to the reasonable satisfaction of the Company which failure continues, in the reasonable judgment of the Company, after written notice given to the grantee by the Company; (iv) the grantee's gross negligence, willful misconduct or insubordination with respect to the Company or any Affiliate of the Company; or (v) the grantee's material violation of any provision of any agreement(s) between the grantee and the Company relating to noncompetition, nonsolicitation, nondisclosure and/or assignment of inventions.

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*"Chief Executive Officer"* means the Chief Executive Officer of the Company or, if there is no Chief Executive Officer, then the President of the Company.

"*Class A Common Stock*" means the Company's Class A Common Stock, par value $0.00001 per share.

"*Class F Common Stock*" means the Company's Class F-1 Common Stock and Class F-2 Common Stock, collectively.

"*Class F-1 Common Stock*" means the Company's Class F-1 Common Stock, par value $0.00001 per share.

"*Class F-2 Common Stock*" means the Company's Class F-2 Common Stock, par value $0.00001 per share.

"*Code*" means the Internal Revenue Code of 1986, as amended, and any successor Code, and related rules, regulations and interpretations.

"*Committee*" means the Committee of the Board referred to in Section 2.

*"Consultant"* means any natural person that provides bona fide services to the Company (including a Subsidiary), and such services are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company's securities.

"*Disability*" means "disability" as defined in Section 422(c) of the Code.

"*Effective Date*" means the date on which the Plan is adopted as set forth on the final page of the Plan.

"*Exchange Act*" means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

"*Fair Market Value*" means, as of any date, the fair market value of the Class A Common Stock or Class F Common Stock, as applicable, as determined in good faith by the Committee based on the reasonable application of a reasonable valuation method not inconsistent with Section 409A of the Code. If the Stock is admitted to trade on a national securities exchange, the determination shall be made by reference to the closing price reported on such exchange. If there is no closing price for such date, the determination shall be made by reference to the last date preceding such date for which there is a closing price. If the date for which Fair Market Value is determined is the first day when trading prices for the Stock are reported on a national securities exchange, the Fair Market Value shall be the "Price to the Public" (or equivalent) set forth on the cover page for the final prospectus relating to the Company's Initial Public Offering.

*"Good Reason"* shall have the meaning as set forth in the Award Agreement(s). In the case that any Award Agreement does not contain a definition of "Good Reason," it shall mean (i) a material diminution in the grantee's base salary except for across-the-board salary reductions similarly affecting all or substantially all similarly situated employees of the Company or (ii) a change of more than 50 miles in the geographic location at which the grantee provides services to the Company, so long as the grantee provides at least 90 days notice to the Company following the initial occurrence of any such event and the Company fails to cure such event within 30 days thereafter.

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"*Grant Date"* means the date that the Committee designates in its approval of an Award in accordance with applicable law as the date on which the Award is granted, which date may not precede the date of such Committee approval.

*"Holder"* means, with respect to an Award or any Shares, the Person holding such Award or Shares, including the initial recipient of the Award or any Permitted Transferee.

"*Incentive Stock Option*" means any Stock Option designated and qualified as an "incentive stock option" as defined in Section 422 of the Code.

"*Initial Public Offering*" means the consummation of the first firm commitment underwritten public offering pursuant to an effective registration statement under the Securities Act covering the offer and sale by the Company of its equity securities, as a result of or following which the Stock shall be publicly held.

"*Non-Qualified Stock Option*" means any Stock Option that is not an Incentive Stock Option.

"*Option*" or "*Stock Option*" means any option to purchase shares of Stock granted pursuant to Section 5.

"*Permitted Transferees*" shall mean any of the following to whom a Holder may transfer Shares hereunder (as set forth in Section 9(a)(ii)(A)): the Holder's child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive relationships, any person sharing the Holder's household (other than a tenant or employee), a trust in which these persons have more than fifty percent of the beneficial interest, a foundation in which these persons control the management of assets, and any other entity in which these persons own more than fifty percent of the voting interests*; provided, however,* that any such trust does not require or permit distribution of any Shares during the term of the Award Agreement unless subject to its terms. Upon the death of the Holder, the term Permitted Transferees shall also include such deceased Holder's estate, executors, administrators, personal representatives, heirs, legatees and distributees, as the case may be.

"*Person*" shall mean any individual, corporation, partnership (limited or general), limited liability company, limited liability partnership, association, trust, joint venture, unincorporated organization or any similar entity.

*"Restricted Stock Award"* means Awards granted pursuant to Section 6 and *"Restricted Stock"* means Shares issued pursuant to such Awards.

*"Restricted Stock Unit"* means an Award of phantom stock units to a grantee, which may be settled in cash or Shares as determined by the Committee, pursuant to Section 8.

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"*Sale Event"* means the consummation of (i) the dissolution or liquidation of the Company, (ii) the sale of all or substantially all of the assets of the Company on a consolidated basis to an unrelated person or entity, (iii) a merger, reorganization or consolidation pursuant to which the holders of the Company's outstanding voting power immediately prior to such transaction do not own a majority of the outstanding voting power of the surviving or resulting entity (or its ultimate parent, if applicable), (iv) the acquisition of all or a majority of the outstanding voting stock of the Company in a single transaction or a series of related transactions by a Person or group of Persons, or (v) any other acquisition of the business of the Company, as determined by the Board; *provided, however,* that the Company's Initial Public Offering, any subsequent public offering or another capital raising event, or a merger effected solely to change the Company's domicile shall not constitute a "<u>Sale Event</u>."

*"Section 409A"* means Section 409A of the Code and the regulations and other guidance promulgated thereunder.

"*Securities Act*" means the Securities Act of 1933, as amended, and the rules and regulations thereunder.

*"Service Relationship"* means any relationship as a full-time employee, part-time employee, director or other key person (including Consultants) of the Company or any Subsidiary or any successor entity (e.g., a Service Relationship shall be deemed to continue without interruption in the event an individual's status changes from full-time employee to part-time employee or Consultant).

*"Shares"* means shares of Stock.

"*Stock*" means Class F Common Stock or Class A Common Stock, as the case may be.

"*Subsidiary*" means any corporation or other entity (other than the Company) in which the Company has more than a 50 percent interest, either directly or indirectly.

*"Ten Percent Owner"* means an employee who owns or is deemed to own (by reason of the attribution rules of Section 424(d) of the Code) more than 10 percent of the combined voting power of all classes of stock of the Company or any parent of the Company or any Subsidiary.

*"Termination Event"* means the termination of the Award recipient's Service Relationship with the Company and its Subsidiaries for any reason whatsoever, regardless of the circumstances thereof, and including, without limitation, upon death, disability, retirement, discharge or resignation for any reason, whether voluntarily or involuntarily. The following shall not constitute a Termination Event: (i) a transfer to the service of the Company from a Subsidiary or from the Company to a Subsidiary, or from one Subsidiary to another Subsidiary or (ii) an approved leave of absence for military service or sickness, or for any other purpose approved by the Committee, if the individual's right to re-employment is guaranteed either by a statute or by contract or under the policy pursuant to which the leave of absence was granted or if the Committee otherwise so provides in writing.

"*Unrestricted Stock Award"* means any Award granted pursuant to Section 7 and *"Unrestricted Stock"* means Shares issued pursuant to such Awards.

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SECTION 2. <u>ADMINISTRATION OF PLAN; COMMITTEE AUTHORITY TO SELECT GRANTEES AND DETERMINE AWARDS</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Administration of Plan</u>. The Plan shall be administered by the Board, or at the discretion of the Board, by a committee of the Board, comprised of not less than two directors. All references herein to the "Committee" shall be deemed to refer to the group then responsible for administration of the Plan at the relevant time (i.e., either the Board or a committee or committees of the Board, as applicable).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Powers of Committee</u>. The Committee shall have the power and authority to grant Awards consistent with the terms of the Plan, including the power and authority:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to select the individuals to whom Awards may from time to time be granted;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) to determine the time or times of grant, and the amount, if any, of Incentive Stock Options, Non-Qualified Stock Options, Restricted Stock Awards, Unrestricted Stock Awards, Restricted Stock Units, or any combination of the foregoing, granted to any one or more grantees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) to determine the number of Shares and class of Stock to be covered by any Award and, subject to the provisions of the Plan, the price, exercise price, conversion ratio or other price relating thereto;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) to determine and, subject to Section 12, to modify from time to time the terms and conditions, including restrictions, not inconsistent with the terms of the Plan, of any Award, which terms and conditions may differ among individual Awards and grantees, and to approve the form of Award Agreements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) to accelerate at any time the exercisability or vesting of all or any portion of any Award;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) to impose any limitations on Awards, including limitations on transfers, repurchase provisions and the like, and to exercise repurchase rights or obligations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) subject to Section 5(a)(ii) and any restrictions imposed by Section 409A, to extend at any time the period in which Stock Options may be exercised; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) at any time to adopt, alter and repeal such rules, guidelines and practices for administration of the Plan and for its own acts and proceedings as it shall deem advisable; to interpret the terms and provisions of the Plan and any Award (including Award Agreements); to make all determinations it deems advisable for the administration of the Plan; to decide all disputes arising in connection with the Plan; and to otherwise supervise the administration of the Plan.

All decisions and interpretations of the Committee shall be binding on all persons, including the Company and all Holders.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Award Agreement</u>. Awards under the Plan shall be evidenced by Award Agreements that set forth the terms, conditions and limitations for each Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Indemnification</u>. Neither the Board nor the Committee, nor any member of either or any delegate thereof, shall be liable for any act, omission, interpretation, construction or determination made in good faith in connection with the Plan, and the members of the Board and the Committee (and any delegate thereof) shall be entitled in all cases to indemnification and reimbursement by the Company in respect of any claim, loss, damage or expense (including, without limitation, reasonable attorneys' fees) arising or resulting therefrom to the fullest extent permitted by law and/or under the Company's governing documents, including its certificate of incorporation or bylaws (each, as may be amended and/or restated from time to time), or any directors' and officers' liability insurance coverage which may be in effect from time to time and/or any indemnification agreement between such individual and the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Foreign Award Recipients</u>. Notwithstanding any provision of the Plan to the contrary, in order to comply with the laws in other countries in which the Company and any Subsidiary operate or have employees or other individuals eligible for Awards, the Committee, in its sole discretion, shall have the power and authority to: (i) determine which Subsidiaries, if any, shall be covered by the Plan; (ii) determine which individuals, if any, outside the United States are eligible to participate in the Plan; (iii) modify the terms and conditions of any Award granted to individuals outside the United States to comply with applicable foreign laws; (iv) establish subplans and modify exercise procedures and other terms and procedures, to the extent the Committee determines such actions to be necessary or advisable (and such subplans and/or modifications shall be attached to the Plan as appendices); <u>provided</u>, <u>however</u>, that no such subplans and/or modifications shall increase the share limitation contained in Section 3(a) hereof; and (v) take any action, before or after an Award is made, that the Committee determines to be necessary or advisable to obtain approval or comply with any local governmental regulatory exemptions or approvals.

SECTION 3. <u>STOCK ISSUABLE UNDER THE PLAN; MERGERS AND OTHER TRANSACTIONS; SUBSTITUTION</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Stock Issuable</u>. The maximum number of Shares reserved and available for issuance under the Plan shall be 10,000,000 Shares, consisting of (i) 2,500,000 shares of Class A Common Stock <u>plus</u> any shares of Class F Common Stock that are converted into Class A Common Stock, (ii) 5,000,000 shares of Class F-1 Common Stock <u>less</u> any shares of Class F-1 Common Stock that are converted into Class A Common Stock, and (iii) 2,500,000 shares of Class F-2 Common Stock <u>less</u> any shares of Class F-2 Common Stock that are converted into Class A Common Stock, in each case subject to adjustment as provided in Section 3(b). For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 100,000,000 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Changes in Stock</u>. Subject to Section 3(c) hereof, if, as a result of any reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Company's capital stock, the outstanding Shares are increased or decreased or are exchanged for a different number, class or kind of shares or other securities of the Company, or additional Shares or new or different shares or other securities of the Company or other non-cash assets are distributed with respect to such Shares or other securities, in each case, without the receipt of consideration by the Company, or, if, as a result of any merger or consolidation, or sale of all or substantially all of the assets of the Company, the outstanding Shares are converted into or exchanged for other securities of the Company or any successor entity (or a parent or subsidiary thereof), the Committee shall make an appropriate and proportionate adjustment in (i) the maximum number of Shares reserved for issuance under the Plan, (ii) the number, class and kind of Shares or other securities subject to any then outstanding Awards under the Plan, (iii) the repurchase price, if any, per Share subject to each outstanding Award, and (iv) the exercise price for each Share subject to any then outstanding Stock Options under the Plan, without changing the aggregate exercise price (i.e., the per share exercise price multiplied by the number of Shares underlying such Stock Options) as to which such Stock Options remain exercisable. The Committee shall in any event make such adjustments as may be required by Section 25102(o) of the California Corporation Code and the rules and regulations promulgated thereunder. The adjustment by the Committee shall be final, binding and conclusive. No fractional Shares shall be issued under the Plan resulting from any such adjustment, but the Committee in its discretion may make a cash payment in lieu of fractional shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Sale Events</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Options</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) In the case of and subject to the consummation of a Sale Event, the Plan and all outstanding Options issued hereunder shall terminate upon the effective time of any such Sale Event unless assumed or continued by the successor entity, or new stock options or other awards of the successor entity or parent thereof are substituted therefor, with an equitable or proportionate adjustment as to the number, class and kind of shares and, if appropriate, the per share exercise prices, as such parties shall agree (after taking into account any acceleration hereunder and/or pursuant to the terms of any Award Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) In the event of the termination of the Plan and all outstanding Options issued hereunder pursuant to Section 3(c), each Holder of Options shall be permitted, within a period of time prior to the consummation of the Sale Event as specified by the Committee, to exercise all such Options which are then exercisable or will become exercisable as of the effective time of the Sale Event; *provided, however*, that the exercise of Options not exercisable prior to the Sale Event shall be subject to the consummation of the Sale Event.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Notwithstanding anything to the contrary in Section 3(c)(i)(A), in the event of a Sale Event, the Company shall have the right, but not the obligation, to make or provide for a cash payment to the Holders of Options, without any consent of the Holders, in exchange for the cancellation thereof, in an amount equal to the difference between (A) the value as determined by the Committee of the consideration payable per share of Stock pursuant to the Sale Event (the "<u>Sale Price</u>") times the number of Shares subject to outstanding Options being cancelled (to the extent then vested and exercisable, including by reason of acceleration in connection with such Sale Event, at prices not in excess of the Sale Price) and (B) the aggregate exercise price of all such outstanding vested and exercisable Options.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Restricted Stock and Restricted Stock Unit Awards</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) In the case of and subject to the consummation of a Sale Event, all unvested Restricted Stock and unvested Restricted Stock Unit Awards (other than those becoming vested as a result of the Sale Event) issued hereunder shall be forfeited immediately prior to the effective time of any such Sale Event unless assumed or continued by the successor entity, or awards of the successor entity or parent thereof are substituted therefor, with an equitable or proportionate adjustment as to the number, class and kind of shares subject to such awards as such parties shall agree (after taking into account any acceleration hereunder and/or pursuant to the terms of any Award Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) In the event of the forfeiture of Restricted Stock pursuant to Section 3(c)(ii)(A), such Restricted Stock shall be repurchased from the Holder thereof at a price per share equal to the lower of the original per share purchase price paid by the Holder (subject to adjustment as provided in Section 3(b)) or the current Fair Market Value of such Shares, as determined immediately prior to the effective time of the Sale Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Notwithstanding anything to the contrary in Section 3(c)(ii)(A), in the event of a Sale Event, the Company shall have the right, but not the obligation, to make or provide for a cash payment to the Holders of Restricted Stock or Restricted Stock Unit Awards, without consent of the Holders, in exchange for the cancellation thereof, in an amount equal to the Sale Price times the number of Shares subject to such Awards, to be paid at the time of such Sale Event or upon the later vesting of such Awards.

SECTION 4. <u>ELIGIBILITY</u>

Grantees under the Plan will be such full or part-time officers and other employees, directors, Consultants and key persons of the Company and any Subsidiary who are selected from time to time by the Committee in its sole discretion; <u>provided</u>, <u>however</u>, that Awards shall be granted only to those individuals described in Rule 701(c) of the Securities Act.

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SECTION 5. <u>STOCK OPTIONS</u>

Upon the grant of a Stock Option, the Company and the grantee shall enter into an Award Agreement. The terms and conditions of each such Award Agreement shall be determined by the Committee, and such terms and conditions may differ among individual Awards and grantees.

Stock Options granted under the Plan may be either Incentive Stock Options or Non-Qualified Stock Options. Incentive Stock Options may be granted only to employees of the Company or any Subsidiary that is a "subsidiary corporation" within the meaning of Section 424(f) of the Code. To the extent that any Option does not qualify as an Incentive Stock Option, it shall be deemed a Non-Qualified Stock Option.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Terms of Stock Options</u>. The Committee in its discretion may grant Stock Options to those individuals who meet the eligibility requirements of Section 4. Stock Options shall be subject to the following terms and conditions and shall contain such additional terms and conditions, not inconsistent with the terms of the Plan, as the Committee shall deem desirable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Exercise Price</u>. The exercise price per share for the Shares covered by a Stock Option shall be determined by the Committee at the time of grant but shall not be less than 100 percent of the Fair Market Value on the Grant Date. In the case of an Incentive Stock Option that is granted to a Ten Percent Owner, the exercise price per share for the Shares covered by such Incentive Stock Option shall not be less than 110 percent of the Fair Market Value on the Grant Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Option Term</u>. The term of each Stock Option shall be fixed by the Committee, but no Stock Option shall be exercisable more than ten years from the Grant Date. In the case of an Incentive Stock Option that is granted to a Ten Percent Owner, the term of such Stock Option shall be no more than five years from the Grant Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Exercisability; Rights of a Stockholder</u>. Stock Options shall become exercisable and/or vested at such time or times, whether or not in installments, as shall be determined by the Committee at or after the Grant Date. The Award Agreement may permit a grantee to exercise all or a portion of a Stock Option immediately at grant; provided that the Shares issued upon such exercise shall be subject to restrictions and a vesting schedule identical to the vesting schedule of the related Stock Option, such Shares shall be deemed to be Restricted Stock for purposes of the Plan, and the optionee may be required to enter into an additional or new Award Agreement as a condition to exercise of such Stock Option. An optionee shall have the rights of a stockholder only as to Shares acquired upon the exercise of a Stock Option and not as to unexercised Stock Options. An optionee shall not be deemed to have acquired any Shares unless and until a Stock Option shall have been exercised pursuant to the terms of the Award Agreement and this Plan and the optionee's name has been entered on the books of the Company as a stockholder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) <u>Method of Exercise</u>. Stock Options may be exercised by an optionee in whole or in part, by the optionee giving written or electronic notice of exercise to the Company, specifying the number and class of Shares to be purchased. Payment of the purchase price may be made by one or more of the following methods (or any combination thereof) to the extent provided in the Award Agreement:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) In cash, by certified or bank check, by wire transfer of immediately available funds, or other instrument acceptable to the Committee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) If permitted by the Committee, by the optionee delivering to the Company a promissory note, if the Board has expressly authorized the loan of funds to the optionee for the purpose of enabling or assisting the optionee to effect the exercise of his or her Stock Option; <u>provided</u>, that at least so much of the exercise price as represents the par value of the Stock shall be paid in cash if required by state law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) If permitted by the Committee and the Initial Public Offering has occurred (or the Stock otherwise becomes publicly-traded), through the delivery (or attestation to the ownership) of Shares that have been purchased by the optionee on the open market or that are beneficially owned by the optionee and are not then subject to restrictions under any Company plan. To the extent required to avoid variable accounting treatment under ASC 718 or other applicable accounting rules, such surrendered Shares if originally purchased from the Company shall have been owned by the optionee for at least six months. Such surrendered Shares shall be valued at Fair Market Value on the exercise date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) If permitted by the Committee and the Initial Public Offering has occurred (or the Stock otherwise becomes publicly-traded), by the optionee delivering to the Company a properly executed exercise notice together with irrevocable instructions to a broker to promptly deliver to the Company cash or a check payable and acceptable to the Company for the purchase price; <u>provided</u> that in the event the optionee chooses to pay the purchase price as so provided, the optionee and the broker shall comply with such procedures and enter into such agreements of indemnity and other agreements as the Committee shall prescribe as a condition of such payment procedure; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) If permitted by the Committee, and only with respect to Stock Options that are not Incentive Stock Options, by a "net exercise" arrangement pursuant to which the Company will reduce the number of Shares issuable upon exercise by the largest whole number of Shares with a Fair Market Value that does not exceed the aggregate exercise price.

Payment instruments will be received subject to collection. No certificates for Shares so purchased will be issued to the optionee or, with respect to uncertificated Stock, no transfer to the optionee on the records of the Company will take place, until the Company has completed all steps it has deemed necessary to satisfy legal requirements relating to the issuance and sale of the Shares, which steps may include, without limitation, (i) receipt of a representation from the optionee at the time of exercise of the Option that the optionee is purchasing the Shares for the optionee's own account and not with a view to any sale or distribution of the Shares or other representations relating to compliance with applicable law governing the issuance of securities, (ii) the legending of the certificate (or notation on any book entry) representing the Shares to evidence the foregoing restrictions, (iii) obtaining from optionee payment or provision for all

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withholding taxes due as a result of the exercise of the Option and (iv) if required by the Company, the optionee's execution and delivery of any stockholders' agreements or other agreements with the Company and/or certain other stockholders of the Company relating to the shares of the Stock. The delivery of certificates representing the shares of Stock (or the transfer to the optionee on the records of the Company with respect to uncertificated Stock) to be purchased pursuant to the exercise of a Stock Option will be contingent upon (A) receipt from the optionee (or a purchaser acting in his or her stead in accordance with the provisions of the Stock Option) by the Company of the full purchase price for such Shares and the fulfillment of any other requirements contained in the Award Agreement or applicable provisions of laws and (B) if required by the Company, the optionee shall have entered into any stockholders agreements or other agreements with the Company and/or certain other of the Company's stockholders relating to the Stock. In the event an optionee chooses to pay the purchase price by previously-owned Shares through the attestation method, the number of Shares transferred to the optionee upon the exercise of the Stock Option shall be net of the number of Shares attested to.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Annual Limit on Incentive Stock Options</u>. To the extent required for "incentive stock option" treatment under Section 422 of the Code, the aggregate Fair Market Value (determined as of the Grant Date) of the Shares with respect to which Incentive Stock Options granted under the Plan and any other plan of the Company or its parent and any Subsidiary that become exercisable for the first time by an optionee during any calendar year shall not exceed $100,000 or such other limit as may be in effect from time to time under Section 422 of the Code. To the extent that any Stock Option exceeds this limit, it shall constitute a Non-Qualified Stock Option.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Any portion of a Stock Option that is not vested and exercisable on the date of termination of an optionee's Service Relationship shall immediately expire and be null and void. Once any portion of the Stock Option becomes vested and exercisable, the optionee's right to exercise such portion of the Stock Option (or the optionee's representatives and legatees as applicable) in the event of a termination of the optionee's Service Relationship shall continue until the earliest of: (i) the date which is: (A) 12 months following the date on which the optionee's Service Relationship terminates due to death or Disability (or such longer period of time as determined by the Committee and set forth in the applicable Award Agreement), or (B) 90 days following the date on which the optionee's Service Relationship terminates if the termination is due to any reason other than death or Disability (or such longer period of time as determined by the Committee and set forth in the applicable Award Agreement), or (ii) the Expiration Date set forth in the Award Agreement; <u>provided</u> that notwithstanding the foregoing, an Award Agreement may provide that if the optionee's Service Relationship is terminated for Cause, the Stock Option shall terminate immediately and be null and void upon the date of the optionee's termination and shall not thereafter be exercisable.

SECTION 6. <u>RESTRICTED STOCK AWARDS</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Nature of Restricted Stock Awards</u>. The Committee may, in its sole discretion, grant (or sell at par value or such other purchase price determined by the Committee) to an eligible individual under Section 4 hereof a Restricted Stock Award under the Plan. The Committee shall determine the restrictions and conditions applicable to each Restricted Stock Award at the time of grant. Conditions may be based on continuing employment (or other

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Service Relationship), achievement of pre-established performance goals and objectives and/or such other criteria as the Committee may determine. Upon the grant of a Restricted Stock Award, the Company and the grantee shall enter into an Award Agreement. The terms and conditions of each such Award Agreement shall be determined by the Committee, and such terms and conditions may differ among individual Awards and grantees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Rights as a Stockholder</u>. Upon the grant of the Restricted Stock Award and payment of any applicable purchase price, a grantee of Restricted Stock shall be considered the record owner of and shall be entitled to vote the Restricted Stock if, and to the extent, such Shares are entitled to voting rights, subject to such conditions contained in the Award Agreement. The grantee shall be entitled to receive all dividends and any other distributions declared on the Shares; <u>provided</u>, <u>however</u>, that the Company is under no duty to declare any such dividends or to make any such distribution. Unless the Committee shall otherwise determine, certificates evidencing the Restricted Stock shall remain in the possession of the Company until such Restricted Stock is vested as provided in subsection (d) below of this Section, and the grantee shall be required, as a condition of the grant, to deliver to the Company a stock power endorsed in blank and such other instruments of transfer as the Committee may prescribe.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Restrictions</u>. Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered or disposed of except as specifically provided herein or in the Award Agreement. Except as may otherwise be provided by the Committee either in the Award Agreement or, subject to Section 12 below, in writing after the Award Agreement is issued, if a grantee's Service Relationship with the Company and any Subsidiary terminates, the Company or its assigns shall have the right, as may be specified in the relevant instrument, to repurchase some or all of the Shares subject to the Award at such purchase price as is set forth in the Award Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Vesting of Restricted Stock</u>. The Committee at the time of grant shall specify in the Award Agreement the date or dates and/or the attainment of pre-established performance goals, objectives and other conditions on which the substantial risk of forfeiture imposed shall lapse and the Restricted Stock shall become vested, subject to such further rights of the Company or its assigns as may be specified in the Award Agreement.

SECTION 7. <u>UNRESTRICTED STOCK AWARDS</u>

The Committee may, in its sole discretion, grant (or sell at par value or such other purchase price determined by the Committee) to an eligible person under Section 4 hereof an Unrestricted Stock Award under the Plan. Unrestricted Stock Awards may be granted in respect of past services or other valid consideration, or in lieu of cash compensation due to such grantee.

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SECTION 8. <u>RESTRICTED STOCK UNITS</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Nature of Restricted Stock Units</u>. The Committee may, in its sole discretion, grant to an eligible person under Section 4 hereof Restricted Stock Units under the Plan. The Committee shall determine the restrictions and conditions applicable to each Restricted Stock Unit at the time of grant. Vesting conditions may be based on continuing employment (or other Service Relationship), achievement of pre-established performance goals and objectives and/or other such criteria as the Committee may determine. Upon the grant of Restricted Stock Units, the grantee and the Company shall enter into an Award Agreement. The terms and conditions of each such Award Agreement shall be determined by the Committee and may differ among individual Awards and grantees. On or promptly following the vesting date or dates applicable to any Restricted Stock Unit, but in no event later than March 15 of the year following the year in which such vesting occurs, such Restricted Stock Unit(s) shall be settled in the form of cash or shares of Stock, as specified in the Award Agreement. Restricted Stock Units may not be sold, assigned, transferred, pledged, or otherwise encumbered or disposed of.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Rights as a Stockholder</u>. A grantee shall have the rights of a stockholder only as to Shares, if any, acquired upon settlement of Restricted Stock Units. A grantee shall not be deemed to have acquired any such Shares unless and until the Restricted Stock Units shall have been settled in Shares pursuant to the terms of the Plan and the Award Agreement, the Company shall have issued and delivered a certificate representing the Shares to the grantee (or transferred on the records of the Company with respect to uncertificated stock), and the grantee's name has been entered in the books of the Company as a stockholder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Except as may otherwise be provided by the Committee either in the Award Agreement or in writing after the Award Agreement is issued, a grantee's right in all Restricted Stock Units that have not vested shall automatically terminate upon the grantee's cessation of Service Relationship with the Company and any Subsidiary for any reason.

SECTION 9. <u>TRANSFER RESTRICTIONS; COMPANY RIGHT OF FIRST REFUSAL; COMPANY REPURCHASE RIGHTS</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Restrictions on Transfer</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Non-Transferability of Stock Options</u>. Stock Options and, prior to exercise, the Shares issuable upon exercise of such Stock Option, shall not be transferable by the optionee otherwise than by will, or by the laws of descent and distribution, and all Stock Options shall be exercisable, during the optionee's lifetime, only by the optionee, or by the optionee's legal representative or guardian in the event of the optionee's incapacity. Notwithstanding the foregoing, the Committee, in its sole discretion, may provide in the Award Agreement regarding a given Stock Option that the optionee may transfer by gift, without consideration for the transfer, his or her Non-Qualified Stock Options to his or her family members (as defined in Rule 701 of the Securities Act), to trusts for the benefit of such family members, or to partnerships in which such family members are the only partners (to the extent such trusts or partnerships are considered "family members" for purposes of Rule 701 of the Securities Act), provided that the transferee agrees in writing with the Company to be bound by all of the terms and conditions of this Plan and the applicable Award Agreement, including the execution of a stock power upon the issuance of Shares. Stock Options, and the Shares issuable upon exercise of such Stock Options, shall be restricted as to any pledge, hypothecation, or other transfer, including any short position, any "put equivalent position" (as defined in the Exchange Act) or any "call equivalent position" (as defined in the Exchange Act) prior to exercise.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Shares</u>. No Shares shall be sold, assigned, transferred, pledged, hypothecated, given away or in any other manner disposed of or encumbered, whether voluntarily or by operation of law, unless (i) the transfer is in compliance with the terms of the applicable Award Agreement, all applicable securities laws (including, without limitation, the Securities Act), and with the terms and conditions of this Section 9, (ii) the transfer does not cause the Company to become subject to the reporting requirements of the Exchange Act, and (iii) the transferee consents in writing to be bound by the provisions of the Plan and the Award Agreement, including this Section 9. In connection with any proposed transfer, the Committee may require the transferor to provide at the transferor's own expense an opinion of counsel to the transferor, satisfactory to the Committee, that such transfer is in compliance with all foreign, federal and state securities laws (including, without limitation, the Securities Act). Any attempted transfer of Shares not in accordance with the terms and conditions of this Section 9 shall be null and void, and the Company shall not reflect on its records any change in record ownership of any Shares as a result of any such transfer, shall otherwise refuse to recognize any such transfer and shall not in any way give effect to any such transfer of Shares. The Company shall be entitled to seek protective orders, injunctive relief and other remedies available at law or in equity including, without limitation, seeking specific performance or the rescission of any transfer not made in strict compliance with the provisions of this Section 9. Subject to the foregoing general provisions, and unless otherwise provided in the applicable Award Agreement, Shares may be transferred pursuant to the following specific terms and conditions (provided that with respect to any transfer of Restricted Stock, all vesting and forfeiture provisions shall continue to apply with respect to the original recipient):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) <u>Transfers to Permitted Transferees</u>. The Holder may transfer any or all of the Shares to one or more Permitted Transferees; *provided, however*, that following such transfer, such Shares shall continue to be subject to the terms of this Plan (including this Section 9) and such Permitted Transferee(s) shall, as a condition to any such transfer, deliver a written acknowledgment to that effect to the Company and shall deliver a stock power to the Company with respect to the Shares. Notwithstanding the foregoing, the Holder may not transfer any of the Shares to a Person whom the Company reasonably determines is a direct competitor or a potential competitor of the Company or any of its Subsidiaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) <u>Transfers Upon Death</u>. Upon the death of the Holder, any Shares then held by the Holder at the time of such death and any Shares acquired after the Holder's death by the Holder's legal representative shall be subject to the provisions of this Plan, and the Holder's estate, executors, administrators, personal representatives, heirs, legatees and distributees shall be obligated to convey such Shares to the Company or its assigns under the terms contemplated by the Plan and the Award Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Right of First Refusal</u>. In the event that a Holder desires at any time to sell or otherwise transfer all or any part of his or her Shares (other than shares of Restricted Stock which by their terms are not transferrable), the Holder first shall give written notice to the Company of the Holder's intention to make such transfer. Such notice shall state the number and class of Shares that the Holder proposes to sell (the "<u>Offered Shares</u>"), the price and the terms at which the proposed sale is to be made and the name and address of the proposed transferee. At any time within 30 days after the receipt of such notice by the Company, the Company or its

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assigns may elect to purchase all or any portion of the Offered Shares at the price and on the terms offered by the proposed transferee and specified in the notice. The Company or its assigns shall exercise this right by mailing or delivering written notice to the Holder within the foregoing 30-day period. If the Company or its assigns elect to exercise its purchase rights under this Section 9(b), the closing for such purchase shall, in any event, take place within 45 days after the receipt by the Company of the initial notice from the Holder. In the event that the Company or its assigns do not elect to exercise such purchase right, or in the event that the Company or its assigns do not pay the full purchase price within such 45-day period, the Holder may, within 60 days thereafter, sell the Offered Shares to the proposed transferee and at the same price and on the same terms as specified in the Holder's notice. Any Shares not sold to the proposed transferee shall remain subject to the Plan. If the Holder is a party to any stockholders agreements or other agreements with the Company and/or certain other of the Company's stockholders relating to the Shares, (i) the transferring Holder shall comply with the requirements of such stockholders agreements or other agreements relating to any proposed transfer of the Offered Shares, and (ii) any proposed transferee that purchases Offered Shares shall enter into such stockholders agreements or other agreements with the Company and/or certain of the Company's stockholders relating to the Offered Shares on the same terms and in the same capacity as the transferring Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Company's Right of Repurchase</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Right of Repurchase for Unvested Shares Issued Upon the Exercise of an Option</u>. Upon a Termination Event, the Company or its assigns shall have the right and option to repurchase from a Holder of Shares acquired upon exercise of a Stock Option which are still subject to a risk of forfeiture as of the Termination Event. Such repurchase rights may be exercised by the Company within the later of (A) six months following the date of such Termination Event or (B) seven months after the acquisition of Shares upon exercise of a Stock Option. The repurchase price shall be equal to the lower of the original per share price paid by the Holder, subject to adjustment as provided in Section 3(b) of the Plan, or the current Fair Market Value of such Shares as of the date the Company elects to exercise its repurchase rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Right of Repurchase With Respect to Restricted Stock</u>. Upon a Termination Event, the Company or its assigns shall have the right and option to repurchase from a Holder of Shares received pursuant to a Restricted Stock Award any Shares that are still subject to a risk of forfeiture as of the Termination Event. Such repurchase right may be exercised by the Company within six months following the date of such Termination Event. The repurchase price shall be the lower of the original per share purchase price paid by the Holder, subject to adjustment as provided in Section 3(b) of the Plan, or the current Fair Market Value of such Shares as of the date the Company elects to exercise its repurchase rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Procedure</u>. Any repurchase right of the Company shall be exercised by the Company or its assigns by giving the Holder written notice on or before the last day of the repurchase period of its intention to exercise such repurchase right. Upon such notification, the Holder shall promptly surrender to the Company, free and clear of any liens or encumbrances, any certificates representing the Shares being purchased, together with a duly executed stock power for the transfer of such Shares to the Company or the Company's assignee or assignees. Upon the Company's or its assignee's receipt of the certificates from the Holder, the Company or its assignee or assignees shall deliver to him, her or them a check for the applicable repurchase price; *provided, however*, that the Company may pay the repurchase price by offsetting and canceling any indebtedness then owed by the Holder to the Company.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Reserved</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Escrow Arrangement</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Escrow</u>. In order to carry out the provisions of this Section 9 of this Plan more effectively, the Company shall hold any Shares issued pursuant to Awards granted under the Plan in escrow together with separate stock powers executed by the Holder in blank for transfer. The Company shall not dispose of the Shares except as otherwise provided in this Plan. In the event of any repurchase by the Company (or any of its assigns), the Company is hereby authorized by the Holder, as the Holder's attorney-in-fact, to date and complete the stock powers necessary for the transfer of the Shares being purchased and to transfer such Shares in accordance with the terms hereof. At such time as any Shares are no longer subject to the Company's repurchase and first refusal rights, the Company shall, at the written request of the Holder, deliver to the Holder a certificate representing such Shares with the balance of the Shares to be held in escrow pursuant to this Section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Remedy</u>. Without limitation of any other provision of this Plan or other rights, in the event that a Holder or any other Person is required to sell a Holder's Shares pursuant to the provisions of Sections 9(b) or (c) hereof and in the further event that he or she refuses or for any reason fails to deliver to the Company or its designated purchaser of such Shares the certificate or certificates evidencing such Shares together with a related stock power, the Company or such designated purchaser may deposit the applicable purchase price for such Shares with a bank designated by the Company, or with the Company's independent public accounting firm, as agent or trustee, or in escrow, for such Holder or other Person, to be held by such bank or accounting firm for the benefit of and for delivery to him, her, them or it, and/or, in its discretion, pay such purchase price by offsetting any indebtedness then owed by such Holder as provided above. Upon any such deposit and/or offset by the Company or its designated purchaser of such amount and upon notice to the Person who was required to sell the Shares to be sold pursuant to the provisions of Sections 9(b) or (c), such Shares shall at such time be deemed to have been sold, assigned, transferred and conveyed to such purchaser, such Holder shall have no further rights thereto (other than the right to withdraw the payment thereof held in escrow, if applicable), and the Company shall record such transfer in its stock transfer book or in any appropriate manner.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Lockup Provision</u>. If requested by the Company, a Holder shall not sell or otherwise transfer or dispose of any Shares (including, without limitation, pursuant to Rule 144 under the Securities Act) held by him or her for such period following consummation of, or the effective date of a registration statement pertaining to, a public offering by the Company of Shares as the Company shall specify reasonably and in good faith. If requested by the underwriter engaged by the Company, each Holder shall execute a separate letter confirming his or her agreement to comply with this Section.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Adjustments for Changes in Capital Structure</u>. If, as a result of any reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Class A Common Stock or Class F Common Stock, the outstanding Shares are increased or decreased or are exchanged for a different number, class or kind of securities of the Company, the restrictions contained in this Section 9 shall apply with equal force to additional and/or substitute securities, if any, received by Holder in exchange for, or by virtue of his or her ownership of, Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Termination</u>. The terms and provisions of Section 9(b) and Section 9(c) (except for the Company's right to repurchase Shares still subject to a risk of forfeiture upon a Termination Event) shall terminate upon the closing of the Company's Initial Public Offering or upon consummation of any Sale Event, in either case as a result of which Shares are registered under Section 12 of the Exchange Act and publicly-traded on any national security exchange.

SECTION 10. <u>TAX WITHHOLDING</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Payment by Grantee</u>. Each grantee shall, no later than the date as of which the value of an Award or of any Shares or other amounts received thereunder first becomes includable in the gross income of the grantee for income tax purposes, pay to the Company, or make arrangements satisfactory to the Committee regarding payment of, any Federal, state, or local taxes of any kind required by law to be withheld by the Company with respect to such income. The Company and any Subsidiary shall, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the grantee. The Company's obligation to deliver stock certificates (or evidence of book entry) to any grantee is subject to and conditioned on any such tax withholding obligations being satisfied by the grantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Payment in Stock</u>. The Company's required tax withholding obligation may be satisfied, in whole or in part, by the Company (i) withholding from Shares to be issued pursuant to an Award a number of Shares having an aggregate Fair Market Value (as of the date the withholding is effected) that would satisfy the withholding amount due or (ii) causing its transfer agent to sell a number of Shares with an aggregate Fair Market Value (as of the date the withholding is effected) that would satisfy the withholding amount due and remitting the proceeds from such sale to the Company.

SECTION 11. <u>SECTION</u> <u>409A AWARDS.</u> 

To the extent that any Award is determined to constitute "nonqualified deferred compensation" within the meaning of Section 409A (a "<u>409A Award</u>"), the Award shall be subject to such additional rules and requirements as may be specified by the Committee from time to time. In this regard, if any amount under a 409A Award is payable upon a "separation from service" (within the meaning of Section 409A) to a grantee who is considered a "specified employee" (within the meaning of Section 409A), then no such payment shall be made prior to the date that is the earlier of (i) six months and one day after the grantee's separation from service, or (ii) the grantee's death, but only to the extent such delay is necessary to prevent such payment from being subject to interest, penalties and/or additional tax imposed pursuant to Section 409A. The Company makes no representation or warranty and shall have no liability to any grantee under the Plan or any other Person with respect to any penalties or taxes under Section 409A that are, or may be, imposed with respect to any Award.

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SECTION 12. <u>AMENDMENTS AND TERMINATION</u>

The Board may, at any time, amend or discontinue the Plan and the Committee may, at any time, amend or cancel any outstanding Award for the purpose of satisfying changes in law or for any other lawful purpose, but no such action shall adversely affect rights under any outstanding Award without the consent of the holder of the Award. The Committee may exercise its discretion to reduce the exercise price of outstanding Stock Options or effect repricing through cancellation of outstanding Stock Options and by granting such holders new Awards in replacement of the cancelled Stock Options. To the extent determined by the Committee to be required either by the Code to ensure that Incentive Stock Options granted under the Plan are qualified under Section 422 of the Code or otherwise, Plan amendments shall be subject to approval by the Company stockholders entitled to vote at a meeting of stockholders. Nothing in this Section 12 shall limit the Board's or Committee's authority to take any action permitted pursuant to Section 3(c). The Board reserves the right to amend the Plan and/or the terms of any outstanding Stock Options to the extent reasonably necessary to comply with the requirements of the exemption pursuant to paragraph (f)(4) of Rule 12h-1 of the Exchange Act.

SECTION 13. <u>STATUS OF PLAN</u>

With respect to the portion of any Award that has not been exercised and any payments in cash, Stock or other consideration not received by a grantee, a grantee shall have no rights greater than those of a general creditor of the Company unless the Committee shall otherwise expressly so determine in connection with any Award.

SECTION 14. <u>GENERAL PROVISIONS</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>No Distribution; Compliance with Legal Requirements</u>. The Committee may require each person acquiring Shares pursuant to an Award to represent to and agree with the Company in writing that such person is acquiring the Shares without a view to distribution thereof. No Shares shall be issued pursuant to an Award until all applicable securities law and other legal and stock exchange or similar requirements have been satisfied. The Committee may require the placing of such stop-orders and restrictive legends on certificates for Stock and Awards as it deems appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Delivery of Stock Certificates</u>. Stock certificates to grantees under the Plan shall be deemed delivered for all purposes when the Company or a stock transfer agent of the Company shall have mailed such certificates in the United States mail, addressed to the grantee, at the grantee's last known address on file with the Company; provided that stock certificates to be held in escrow pursuant to Section 9 of the Plan shall be deemed delivered when the Company shall have recorded the issuance in its records. Uncertificated Stock shall be deemed delivered for all purposes when the Company or a stock transfer agent of the Company shall have given to the grantee by electronic mail (with proof of receipt) or by United States mail, addressed to the grantee, at the grantee's last known address on file with the Company, notice of issuance and recorded the issuance in its records (which may include electronic "book entry" records).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>No Employment Rights</u>**.** The adoption of the Plan and the grant of Awards do not confer upon any Person any right to continued employment or Service Relationship with the Company or any Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Trading Policy Restrictions</u>. Option exercises and other Awards under the Plan shall be subject to the Company's insider trading policy-related restrictions, terms and conditions as may be established by the Committee, or in accordance with policies set by the Committee, from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Designation of Beneficiary</u>. Each grantee to whom an Award has been made under the Plan may designate a beneficiary or beneficiaries to exercise any Award on or after the grantee's death or receive any payment under any Award payable on or after the grantee's death. Any such designation shall be on a form provided for that purpose by the Committee and shall not be effective until received by the Committee. If no beneficiary has been designated by a deceased grantee, or if the designated beneficiaries have predeceased the grantee, the beneficiary shall be the grantee's estate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Legend</u>. Any certificate(s) representing the Shares shall carry substantially the following legend (and with respect to uncertificated Stock, the book entries evidencing such shares shall contain the following notation):

THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE RESTRICTIONS, TERMS AND CONDITIONS (INCLUDING REPURCHASE AND RESTRICTIONS AGAINST TRANSFERS) CONTAINED IN THE ENCARDA, INC. 2023 STOCK OPTION AND GRANT PLAN AND ANY AGREEMENTS ENTERED INTO THEREUNDER BY AND BETWEEN THE COMPANY AND THE HOLDER OF THIS CERTIFICATE (A COPY OF WHICH IS AVAILABLE AT THE OFFICES OF THE COMPANY FOR EXAMINATION).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Information to Holders of Options</u>. In the event the Company is relying on the exemption from the registration requirements of Section 12(g) of the Exchange Act contained in paragraph (f)(1) of Rule 12h-1 of the Exchange Act, the Company shall provide the information described in Rule 701(e)(3), (4) and (5) of the Securities Act to all holders of Options in accordance with the requirements thereunder. The foregoing notwithstanding, the Company shall not be required to provide such information unless the optionholder has agreed in writing, on a form prescribed by the Company, to keep such information confidential.

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SECTION 15. <u>EFFECTIVE DATE OF PLAN</u>

The Plan shall become effective upon adoption by the Board and shall be approved by stockholders in accordance with applicable state law and the Company's certificate of incorporation and bylaws within 12 months thereafter. If the stockholders fail to approve the Plan within 12 months after its adoption by the Board of Directors, then any Awards granted or sold under the Plan shall be rescinded and no additional grants or sales shall thereafter be made under the Plan. Subject to such approval by stockholders and to the requirement that no Shares may be issued hereunder prior to such approval, Stock Options and other Awards may be granted hereunder on and after adoption of the Plan by the Board. No grants of Stock Options and other Awards may be made hereunder after the tenth anniversary of the date the Plan is adopted by the Board or the date the Plan is approved by the Company's stockholders, whichever is earlier.

SECTION 16. <u>GOVERNING LAW</u>

This Plan, all Awards and any controversy arising out of or relating to this Plan and all Awards shall be governed by and construed in accordance with the internal laws of the State of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

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| | |
|:---|:---|
| DATE ADOPTED BY THE BOARD OF DIRECTORS: | AUGUST 18, 2023 |
|  DATE APPROVED BY THE STOCKHOLDERS: | AUGUST 18, 2023 |

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**AMENDMENT NO. 1 TO** 

**KARDIGAN, INC.** 

**AMENDED AND RESTATED** 

**2023 STOCK OPTION AND GRANT PLAN** 

**February 3, 2025** 

**RECITALS** 

A. Previously the Board of Directors (the "***Board***") and stockholders, respectively, of Kardigan, Inc., a Delaware corporation (the "***Company***") adopted the Kardigan, Inc. Amended and Restated 2023 Stock Option and Grant Plan (the "***Plan***").

B. On the date hereof, the Board and the Company's stockholders approved the following amendment to the Plan:

**AMENDMENT** 

1. Section 3(a) of the Plan is hereby amended and restated in its entirety as follows:

"<u>Stock Issuable</u>. The initial maximum number of Shares reserved and available for issuance under the Plan shall be 15,001,940 Shares (the "*Initial Share Calculation*"); provided, that upon (i) the First Achieved Milestone, the maximum number of Shares reserved and available for issuance under the Plan shall automatically (without any required action of any Person) be increased to 15,910,514 Shares (the "*First Milestone Share Calculation*") and (ii) the Second Achieved Milestone, the maximum number of Shares reserved and available for issuance under the Plan shall automatically (without any required action of any Person) be increased to 16,819,088 Shares (as applicable, the "*Second Milestone Share Calculation*"); provided further, that the foregoing shall be subject to adjustment as provided in Section 3(b). For the avoidance of doubt, for purposes of the foregoing sentence and determining the maximum number of Shares reserved and available for issuance under the Plan at any time, (i) the Second Milestone Share Calculation shall take precedent over the First Milestone Share Calculation and the Initial Share Calculation and (ii) the First Milestone Share Calculation shall take precedent over the Initial Share Calculation. As used herein, (i) "*First Achieved Milestone*" means the first to occur of the First Milestone Closing (as defined in the Stock Purchase Agreement) or the Second Milestone Closing (as defined in the Stock Purchase Agreement) and (ii) "*Second Achieved Milestone*" means the last to occur of the First Milestone Closing or the Second Milestone Closing. For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 100,000,000 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company."

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2. Except as set forth in this amendment, the Plan shall be unaffected hereby and shall remain in full force and effect.

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**AMENDMENT NO. 2 TO** 

**KARDIGAN, INC.** 

**AMENDED AND RESTATED** 

**2023 STOCK OPTION AND GRANT PLAN** 

**March 20, 2025** 

**RECITALS** 

A. Previously the Board of Directors (the "***Board***") and stockholders, respectively, of Kardigan, Inc., a Delaware corporation (the "***Company***") adopted the Kardigan, Inc. Amended and Restated 2023 Stock Option and Grant Plan, as amended (the "***Plan***").

B. On the date hereof, the Board and the Company's stockholders approved the following amendment to the Plan:

**AMENDMENT** 

1. Section 3(a) of the Plan is hereby amended and restated in its entirety as follows:

"<u>Stock Issuable</u>. The initial maximum number of Shares reserved and available for issuance under the Plan shall be 15,001,940 Shares (the "*Initial Share Calculation*"); provided, that upon (i) the First Achieved Milestone, the maximum number of Shares reserved and available for issuance under the Plan shall automatically (without any required action of any Person) be increased to 17,402,438 Shares (the "*First Milestone Share Calculation*") and (ii) the Second Achieved Milestone, the maximum number of Shares reserved and available for issuance under the Plan shall automatically (without any required action of any Person) be increased to 18,311,012 Shares (as applicable, the "*Second Milestone Share Calculation*"); provided further, that the foregoing shall be subject to adjustment as provided in Section 3(b). For the avoidance of doubt, for purposes of the foregoing sentence and determining the maximum number of Shares reserved and available for issuance under the Plan at any time, (i) the Second Milestone Share Calculation shall take precedent over the First Milestone Share Calculation and the Initial Share Calculation and (ii) the First Milestone Share Calculation shall take precedent over the Initial Share Calculation. As used herein, (i) "*First Achieved Milestone*" means the first to occur of the First Milestone Closing (as defined in the Stock Purchase Agreement) or the Second Milestone Closing (as defined in the Stock Purchase Agreement) and (ii) "*Second Achieved Milestone*" means the last to occur of the First Milestone Closing or the Second Milestone Closing. For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 100,000,000 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company."

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2. Except as set forth in this amendment, the Plan shall be unaffected hereby and shall remain in full force and effect.

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**AMENDMENT NO. 3 TO** 

**KARDIGAN, INC.** 

**AMENDED AND RESTATED** 

**2023 STOCK OPTION AND GRANT PLAN** 

**May 15, 2025** 

**RECITALS** 

A. Previously the Board of Directors (the "***Board***") and stockholders, respectively, of Kardigan, Inc., a Delaware corporation (the "***Company***") adopted the Kardigan, Inc. Amended and Restated 2023 Stock Option and Grant Plan, as amended (the "***Plan***").

B. On the date hereof, the Board and the Company's stockholders approved the following amendment to the Plan:

**AMENDMENT** 

1. Section 3(a) of the Plan is hereby amended and restated in its entirety as follows:

"<u>Stock Issuable</u>. The maximum number of Shares reserved and available for issuance under the Plan shall be 18,311,012 Shares, subject to adjustment as provided in Section 3(b). For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 100,000,000 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company."

2. Except as set forth in this amendment, the Plan shall be unaffected hereby and shall remain in full force and effect.

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**AMENDMENT NO. 4 TO** 

**KARDIGAN, INC.** 

**AMENDED AND RESTATED** 

**2023 STOCK OPTION AND GRANT PLAN** 

**September 4, 2025** 

**RECITALS** 

A. Previously the Board of Directors (the "***Board***") and stockholders, respectively, of Kardigan, Inc., a Delaware corporation (the "***Company***") adopted the Kardigan, Inc. Amended and Restated 2023 Stock Option and Grant Plan, as amended (the "***Plan***").

B. On the date hereof, the Board and the Company's stockholders approved the following amendment to the Plan:

**AMENDMENT** 

1. Section 3(a) of the Plan is hereby amended and restated in its entirety as follows:

"<u>Stock Issuable</u>. The maximum number of Shares reserved and available for issuance under the Plan shall be 21,190,579 Shares, subject to adjustment as provided in Section 3(b). For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 100,000,000 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company."

2. Except as set forth in this amendment, the Plan shall be unaffected hereby and shall remain in full force and effect.

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**AMENDMENT NO. 5 TO** 

**KARDIGAN, INC.** 

**AMENDED AND RESTATED** 

**2023 STOCK OPTION AND GRANT PLAN** 

**February 13, 2026** 

**RECITALS** 

A. Previously the Board of Directors (the "***Board***") and stockholders, respectively, of Kardigan, Inc., a Delaware corporation (the "***Company***") adopted the Kardigan, Inc. Amended and Restated 2023 Stock Option and Grant Plan, as amended (the "***Plan***").

B. On the date hereof, the Board and the Company's stockholders approved the following amendment to the Plan:

**AMENDMENT** 

1. Section 3(a) of the Plan is hereby amended and restated in its entirety as follows:

"<u>Stock Issuable</u>. The maximum number of Shares reserved and available for issuance under the Plan shall be 22,490,579 Shares, subject to adjustment as provided in Section 3(b). For purposes of this limitation, the Shares underlying any Awards that are forfeited, canceled, reacquired by the Company prior to vesting, satisfied without the issuance of Stock or otherwise terminated (other than by exercise) and Shares that are withheld upon exercise of an Option or settlement of an Award to cover the exercise price or tax withholding shall be added back to the Shares available for issuance under the Plan. Subject to such overall limitations, Shares may be issued up to such maximum number pursuant to any type or types of Award, and no more than 224,905,790 Shares may be issued pursuant to Incentive Stock Options. The Shares available for issuance under the Plan may be authorized but unissued Shares or Shares reacquired by the Company."

2. Except as set forth in this amendment, the Plan shall be unaffected hereby and shall remain in full force and effect.

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**NON-QUALIFIED STOCK OPTION GRANT NOTICE** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

Pursuant to the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"), EnCarda, Inc., a Delaware corporation (together with any successor, the "<u>Company</u>"), has granted to the individual named below, an option (the "<u>Stock Option</u>") to purchase on or prior to the Expiration Date, or such earlier date as is specified herein, all or any part of the number of shares of Class [A]/[F-1]/[F-2] Common Stock, par value $0.00001 per share ("<u>Common Stock</u>"), of the Company indicated below (the "<u>Shares</u>"), at the Option Exercise Price per share, subject to the terms and conditions set forth in this Non-Qualified Stock Option Grant Notice (the "<u>Grant Notice</u>"), the attached Non-Qualified Stock Option Agreement (the "<u>Agreement</u>") and the Plan. This Stock Option is not intended to qualify as an "incentive stock option" as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the "<u>Code</u>").

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| | |
|:---|:---|
| Name of Optionee: | __________________ (the "<u>Optionee</u>") |
| No. of Shares: | __________ Shares of Class [A]/[F-1]/[F-2] Common Stock |
| Grant Date: | __________________ |
| Vesting Commencement Date: | __________________ (the "<u>Vesting Commencement Date</u>") |
| Expiration Date: | __________________ (the "<u>Expiration Date</u>") |
| Option Exercise Price/Share: | $_________________ (the "<u>Option Exercise Price</u>") |
| Vesting Schedule: | [25]% of the Shares shall vest and become exercisable on the first anniversary of the Vesting Commencement Date; provided that the Optionee continues to have a Service Relationship with the Company at such time. Thereafter, the remaining [75]% of the Shares shall vest and become exercisable in [36] equal monthly installments following the first anniversary of the Vesting Commencement Date, provided the Optionee continues to have a Service Relationship with the Company on each vesting date. Notwithstanding anything in the Agreement to the contrary, in the case of a Sale Event, this Stock Option and the Shares shall be treated as provided in Section 3(c) of the Plan. |

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**Attachments**: Non-Qualified Stock Option Agreement, EnCarda, Inc. 2023 Stock Option and Grant Plan

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**NON-QUALIFIED STOCK OPTION AGREEMENT** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Grant Notice and the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Vesting, Exercisability and Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No portion of this Stock Option may be exercised until such portion shall have vested and become exercisable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth below, and subject to the determination of the Committee in its sole discretion to accelerate the vesting schedule hereunder, this Stock Option shall be vested and exercisable on the respective dates indicated below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) This Stock Option shall initially be unvested and unexercisable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) This Stock Option shall vest and become exercisable in accordance with the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Except as may otherwise be provided by the Committee, if the Optionee's Service Relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter terminate subject, in each case, to Section 3(c) of the Plan):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Termination Due to Death or Disability</u>. If the Optionee's Service Relationship terminates by reason of such Optionee's death or Disability, this Stock Option may be exercised, to the extent exercisable on the date of such termination, by the Optionee, the Optionee's legal representative or legatee for a period of 12 months from the date of death or Disability or until the Expiration Date, if earlier.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Other Termination</u>. If the Optionee's Service Relationship terminates for any reason other than death or Disability, and unless otherwise determined by the Committee, this Stock Option may be exercised, to the extent exercisable on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier; <u>provided</u> <u>however</u>, if the Optionee's Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.

For purposes hereof, the Committee's determination of the reason for termination of the Optionee's Service Relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees and any Permitted Transferee. Any portion of this Stock Option that is not vested and exercisable on the date of termination of the Service Relationship shall terminate immediately and be null and void.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise of Stock Option</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the Optionee may deliver a Stock Option exercise notice (an "<u>Exercise Notice</u>") in the form of <u>Appendix</u> <u>A</u> hereto indicating his or her election to purchase some or all of the Shares with respect to which this Stock Option is then exercisable. Such notice shall specify the number and class of Shares to be purchased. Payment of the purchase price may be made by one or more of the methods described in Section 5 of the Plan, subject to the limitations contained in such Section of the Plan, including the requirement that the Committee specifically approve in advance certain payment methods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Transferability of Stock Option</u>. This Stock Option is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionee's lifetime only by the Optionee (or by the Optionee's guardian or personal representative in the event of the Optionee's incapacity). The Optionee may elect to designate a beneficiary by providing written notice of the name of such beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionee's Stock Option in the event of the Optionee's death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein in the event of the Optionee's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Restrictions on Transfer of Shares</u>. The Shares acquired upon exercise of the Stock Option shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Adjustments for Changes in Capital Structure</u>. If, as a result of any reorganization, recapitalization, reincorporation, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Class [A][F-1][F-2] Common Stock, the outstanding shares of Class [A][F-1][F-2] Common Stock are increased or decreased or are exchanged for a different number, class or kind of securities of the Company, the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, this Stock Option or Shares acquired pursuant thereto.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Integration</u>. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes all prior agreements and discussions between the parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or this Stock Option, this Agreement, or the breach, termination or validity of the Plan, this Stock Option or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Optionee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 7 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Waiver of Statutory Information Rights</u>. The Optionee understands and agrees that, but for the waiver made herein, the Optionee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of

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Delaware (any and all such rights, and any and all such other rights of the Optionee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Optionee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Optionee under any other written agreement between the Optionee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the date first above written.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |
| Address: | Address: |

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The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof, and understands that this Stock Option is subject to the terms of the Plan and of this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 7 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 8 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| OPTIONEE:<br>|
| <br> Name: |
| Address: |

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SPOUSE'S CONSENT

I acknowledge that I have read the

foregoing Non-Qualified Stock Option Agreement

and understand the contents thereof.

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---

| |
|:---|
| DESIGNATED BENEFICIARY: |
| Beneficiary's Address: |

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<u>Appendix A</u> 

**STOCK OPTION EXERCISE NOTICE** 

**EnCarda, Inc.** 

Attention: ____________________

Pursuant to the terms of the grant notice and stock option agreement between the undersigned and EnCarda, Inc. (the "<u>Company</u>") dated __________ (the "<u>Agreement</u>") under the EnCarda, Inc. 2023 Stock Option and Grant Plan, I, [Insert Name] ________________, hereby [Circle One] partially/fully exercise such option by including herein payment in the amount of $______ representing the purchase price for [Fill in number and class of Shares] ______ Class [A]/[F-1][F-2] Shares. I have chosen the following form(s) of payment:

[ ] 1. Cash

[ ] 2. Check payable to EnCarda, Inc.

[ ] 3. Other (as referenced in the Agreement and described in the Plan (please describe))

_____________________________________________________.

In connection with my exercise of the option as set forth above, I hereby represent and warrant to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) I am purchasing the Shares for my own account for investment only, and not for resale or with a view to the distribution thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) I have had such an opportunity as I have deemed adequate to obtain from the Company such information as is necessary to permit me to evaluate the merits and risks of my investment in the Company and have consulted with my own advisers with respect to my investment in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the Shares and to make an informed investment decision with respect to such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) I can afford a complete loss of the value of the Shares and am able to bear the economic risk of holding such Shares for an indefinite period of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) I understand that the Shares may not be registered under the Securities Act of 1933 (it being understood that the Shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or "blue sky" laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Securities Act of 1933 and under any applicable state securities or "blue sky" laws (or exemptions from the registration requirement thereof). I further acknowledge that certificates representing Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated Shares will include similar restrictive notations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) I have read and understand the Plan and acknowledge and agree that the Shares are subject to all of the relevant terms of the Plan, including without limitation, the transfer restrictions set forth in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) I understand and agree that the Company has a right of first refusal with respect to the Shares pursuant to Section 9(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) I understand and agree that the Company has certain repurchase rights with respect to the Shares pursuant to Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) I understand and agree that I may not sell or otherwise transfer or dispose of the Shares for a period of time following the effective date of a public offering by the Company as described in Section 9(f) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) I understand and agree to the waiver of statutory information rights as set forth in Section 8 of the Agreement.

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| |
|:---|
| Sincerely yours, |
| <br> Name: |
| Address: |
| Date: |

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**INCENTIVE STOCK OPTION GRANT NOTICE** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

Pursuant to the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"), EnCarda, Inc., a Delaware corporation (together with any successor, the "<u>Company</u>"), has granted to the individual named below, an option (the "<u>Stock Option</u>") to purchase on or prior to the Expiration Date, or such earlier date as is specified herein, all or any part of the number of shares of Class [A]/[F-1]/[F-2] Common Stock, par value $0.00001 per share ("<u>Common Stock</u>"), of the Company indicated below (the "<u>Shares</u>"), at the Option Exercise Price per share, subject to the terms and conditions set forth in this Incentive Stock Option Grant Notice (the "<u>Grant Notice</u>"), the attached Incentive Stock Option Agreement (the "<u>Agreement</u>") and the Plan. This Stock Option is intended to qualify as an "incentive stock option" as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the "<u>Code</u>"). To the extent that any portion of the Stock Option does not so qualify, it shall be deemed a non-qualified stock option.

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| | |
|:---|:---|
| Name of Optionee: | __________________ (the "<u>Optionee</u>") |
| No. of Shares: | __________ Shares of Class [A]/[F-1]/[F-2] Common Stock |
| Grant Date: |  |
| Vesting Commencement Date: | __________________ (the "<u>Vesting Commencement Date</u>") |
| Expiration Date: | __________________ (the "<u>Expiration Date</u>") |
| Option Exercise Price/Share: | $_________________ (the "<u>Option Exercise Price</u>") |
| Vesting Schedule: | [25]% of the Shares shall vest and become exercisable on the first anniversary of the Vesting Commencement Date; provided that the Optionee continues to have a Service Relationship with the Company at such time. Thereafter, the remaining [75]% of the Shares shall vest and become exercisable in [36] equal monthly installments following the first anniversary of the Vesting Commencement Date, provided the Optionee continues to have a Service Relationship with the Company on each vesting date. Notwithstanding anything in the Agreement to the contrary, in the case of a Sale Event, this Stock Option and the Shares shall be treated as provided in Section 3(c) of the Plan. |

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**Attachments**: Incentive Stock Option Agreement, EnCarda, Inc. 2023 Stock Option and Grant Plan

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**INCENTIVE STOCK OPTION AGREEMENT** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Grant Notice and the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Vesting, Exercisability and Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No portion of this Stock Option may be exercised until such portion shall have vested and become exercisable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth below, and subject to the determination of the Committee in its sole discretion to accelerate the vesting schedule hereunder, this Stock Option shall be vested and exercisable on the respective dates indicated below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) This Stock Option shall initially be unvested and unexercisable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) This Stock Option shall vest and become exercisable in accordance with the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Except as may otherwise be provided by the Committee, if the Optionee's Service Relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter terminate subject, in each case, to Section 3(c) of the Plan):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Termination Due to Death or Disability</u>. If the Optionee's Service Relationship terminates by reason of such Optionee's death or Disability, this Stock Option may be exercised, to the extent exercisable on the date of such termination, by the Optionee, the Optionee's legal representative or legatee for a period of 12 months from the date of death or Disability or until the Expiration Date, if earlier.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Other Termination</u>. If the Optionee's Service Relationship terminates for any reason other than death or Disability, and unless otherwise determined by the Committee, this Stock Option may be exercised, to the extent exercisable on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier; <u>provided</u> <u>however</u>, if the Optionee's Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.

For purposes hereof, the Committee's determination of the reason for termination of the Optionee's Service Relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees. Any portion of this Stock Option that is not vested and exercisable on the date of termination of the Service Relationship shall terminate immediately and be null and void.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) It is understood and intended that this Stock Option is intended to qualify as an "incentive stock option" as defined in Section 422 of the Code to the extent permitted under applicable law. Accordingly, the Optionee understands that in order to obtain the benefits of an incentive stock option under Section 422 of the Code, no sale or other disposition may be made of Shares for which incentive stock option treatment is desired within the one-year period beginning on the day after the day of the transfer of such Shares to him or her, nor within the two-year period beginning on the day after Grant Date of this Stock Option and further that this Stock Option must be exercised within three months after termination of employment as an employee (or 12 months in the case of death or disability) to qualify as an incentive stock option. If the Optionee disposes (whether by sale, gift, transfer or otherwise) of any such Shares within either of these periods, he or she will notify the Company within 30 days after such disposition. The Optionee also agrees to provide the Company with any information concerning any such dispositions required by the Company for tax purposes. Further, to the extent this Stock Option and any other incentive stock options of the Optionee having an aggregate Fair Market Value in excess of $100,000 (determined as of the Grant Date) first become exercisable in any year, such options will not qualify as incentive stock options.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise of Stock Option</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the Optionee may deliver a Stock Option exercise notice (an "<u>Exercise Notice</u>") in the form of <u>Appendix</u> <u>A</u> hereto indicating his or her election to purchase some or all of the Shares with respect to which this Stock Option is then exercisable. Such notice shall specify the number and class of Shares to be purchased. Payment of the purchase price may be made by one or more of the methods described in Section 5 of the Plan, subject to the limitations contained in such Section of the Plan, including the requirement that the Committee specifically approve in advance certain payment methods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Transferability of Stock Option</u>. This Stock Option is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionee's lifetime only by the Optionee (or by the Optionee's guardian or personal representative in the event of the Optionee's incapacity). The Optionee may elect to designate a beneficiary by providing written notice of the name of such beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionee's Stock Option in the event of the Optionee's death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein in the event of the Optionee's death.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Restrictions on Transfer of Shares</u>. The Shares acquired upon exercise of the Stock Option shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Adjustments for Changes in Capital Structure</u>. If, as a result of any reorganization, recapitalization, reincorporation, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Class [A][F-1][F-2] Common Stock, the outstanding shares of Class [A][F-1][F-2] Common Stock are increased or decreased or are exchanged for a different number, class or kind of securities of the Company, the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, this Stock Option or Shares acquired pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Integration</u>. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes all prior agreements and discussions between the parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or this Stock Option, this Agreement, or the breach, termination or validity of the Plan, this Stock Option or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1 16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Optionee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 7 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune

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from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Waiver of Statutory Information Rights</u>. The Optionee understands and agrees that, but for the waiver made herein, the Optionee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Optionee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Optionee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Optionee under any other written agreement between the Optionee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the date first above written.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |
| Address: | Address: |

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The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof, and understands that this Stock Option is subject to the terms of the Plan and of this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 7 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 8 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| OPTIONEE: |
| Name: |
| Address: |

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SPOUSE'S CONSENT

I acknowledge that I have read the

foregoing Incentive Stock Option Agreement

and understand the contents thereof.

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| |
|:---|
| DESIGNATED BENEFICIARY: |
| Beneficiary's Address: |

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**<u>Appendix A</u>**

**STOCK OPTION EXERCISE NOTICE** 

**EnCarda, Inc.** 

Attention: ____________________

Pursuant to the terms of the grant notice and stock option agreement between the undersigned and EnCarda, Inc. (the "<u>Company</u>") dated __________ (the "<u>Agreement</u>") under the EnCarda, Inc. 2023 Stock Option and Grant Plan, I, [Insert Name] ________________, hereby [Circle One] partially/fully exercise such option by including herein payment in the amount of $______ representing the purchase price for [Fill in number and class of Shares] ______ Class [A]/[F-1][F-2] Shares. I have chosen the following form(s) of payment:

[ ] 1. Cash

[ ] 2. Check payable to EnCarda, Inc.

[ ] 3. Other (as referenced in the Agreement and described in the Plan (please describe))

_____________________________________________________.

In connection with my exercise of the option as set forth above, I hereby represent and warrant to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) I am purchasing the Shares for my own account for investment only, and not for resale or with a view to the distribution thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) I have had such an opportunity as I have deemed adequate to obtain from the Company such information as is necessary to permit me to evaluate the merits and risks of my investment in the Company and have consulted with my own advisers with respect to my investment in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the Shares and to make an informed investment decision with respect to such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) I can afford a complete loss of the value of the Shares and am able to bear the economic risk of holding such Shares for an indefinite period of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) I understand that the Shares may not be registered under the Securities Act of 1933 (it being understood that the Shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or "blue sky" laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Securities Act of 1933 and under any applicable state securities or "blue sky" laws (or exemptions from the registration requirement thereof). I further acknowledge that certificates representing Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated Shares will include similar restrictive notations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) I have read and understand the Plan and acknowledge and agree that the Shares are subject to all of the relevant terms of the Plan, including without limitation, the transfer restrictions set forth in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) I understand and agree that the Company has a right of first refusal with respect to the Shares pursuant to Section 9(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) I understand and agree that the Company has certain repurchase rights with respect to the Shares pursuant to Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) I understand and agree that I may not sell or otherwise transfer or dispose of the Shares for a period of time following the effective date of a public offering by the Company as described in Section 9(f) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) I understand and agree to the waiver of statutory information rights as set forth in Section 8 of the Agreement.

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| |
|:---|
| Sincerely yours, |
| <br> Name: |
| Address: |
| Date: |

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**EARLY EXERCISE** 

**NON-QUALIFIED STOCK OPTION GRANT NOTICE** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

Pursuant to the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"), EnCarda, Inc., a Delaware corporation (together with any successor thereto, the "<u>Company</u>"), has granted to the individual named below, an option (the "<u>Stock Option</u>") to purchase on or prior to the Expiration Date, or such earlier date as is specified herein, all or any part of the number of shares of Class [A]/[F-1]/[F-2] Common Stock, ("<u>Common Stock</u>"), of the Company indicated below (the "<u>Shares</u>"), at the Option Exercise Price per share, subject to the terms and conditions set forth in this Early Exercise Non-Qualified Stock Option Grant Notice (the "<u>Grant Notice</u>"), the attached Early Exercise Non-Qualified Stock Option Agreement (the "<u>Agreement</u>") and the Plan. This Stock Option is not intended to qualify as an "incentive stock option" as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the "<u>Code</u>").

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| | |
|:---|:---|
| Name of Optionee: | ______________________ (the "<u>Optionee</u>") |
| No. of Shares: | _____________ Shares of Class [A]/[F-1]/[F-2] Common Stock |
| Grant Date: | ______________________ |
| Vesting Commencement Date: | ______________________ (the "<u>Vesting Commencement Date</u>") |
| Expiration Date: | ______________________ (the "<u>Expiration Date</u>") |
| Option Exercise Price/Share: | $_____________________ (the "<u>Option Exercise Price</u>") |
| Vesting Schedule: | [25]% of the Shares shall vest and become exercisable on the first anniversary of the Vesting Commencement Date; provided that the Optionee continues to have a Service Relationship with the Company at such time. Thereafter, the remaining [75]% of the Shares shall vest and become exercisable in [36] equal monthly installments following the first anniversary of the Vesting Commencement Date, provided the Optionee continues to have a Service Relationship with the Company on each vesting date. Notwithstanding anything in the Agreement to the contrary, in the case of a Sale Event, this Stock Option and the Shares shall be treated as provided in Section 3(c) of the Plan. |

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**Attachments**: Early Exercise Non-Qualified Stock Option Agreement, Restricted Stock Agreement, EnCarda, Inc. 2023 Stock Option and Grant Plan

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**EARLY EXERCISE** 

**NON-QUALIFIED STOCK OPTION AGREEMENT** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Grant Notice and the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Vesting, Exercisability and Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Stock Option shall be immediately exercisable, regardless of whether the Shares are vested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth below, and subject to the determination of the Committee in its sole discretion to accelerate the vesting schedule hereunder, the Shares shall be vested on the respective dates indicated below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) All Shares shall initially be unvested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Shares shall vest in accordance with the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Except as may otherwise be provided by the Committee, if the Optionee's Service Relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter terminate subject, in each case, to Section 3(c) of the Plan):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Termination Due to Death or Disability</u>. If the Optionee's Service Relationship terminates by reason of such Optionee's death or Disability, this Stock Option may continue to be exercised, to the extent the Shares are vested on the date of termination, by the Optionee, the Optionee's legal representative or legatee for a period of 12 months from the date of death or Disability or until the Expiration Date, if earlier.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Other Termination</u>. If the Optionee's Service Relationship terminates for any reason other than death or Disability, and unless otherwise determined by the Committee, this Stock Option may continue to be exercised, to the extent the Shares are vested on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier; <u>provided however</u>, if the Optionee's Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.

For purposes hereof, the Committee's determination of the reason for termination of the Optionee's Service Relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees and any Permitted Transferee. Any portion of this Stock Option with respect to Shares that are not vested and exercisable on the date of termination of the Service Relationship shall terminate immediately and be null and void.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise of Stock Option</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the Optionee may deliver a Stock Option exercise notice (an "<u>Exercise Notice</u>") in the form of <u>Appendix A</u> hereto indicating his or her election to purchase some or all of the Shares. Such notice shall specify the number and class of Shares to be purchased. To the extent this Stock Option is only partially exercised, such exercise shall first be with respect to the Shares, if any, that have previously vested, and then with respect to the Shares that will next vest, with the Shares that vest at the latest date being exercised last. Payment of the purchase price may be made by one or more of the methods described in Section 5 of the Plan, subject to the limitations contained in such Section of the Plan, including the requirement that the Committee specifically approve in advance certain payment methods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event the Optionee exercises a portion of this Stock Option with respect to Shares that have not vested, the Optionee shall also deliver a Restricted Stock Agreement covering such unvested Shares in the form of <u>Appendix B</u> hereto (the "<u>Restricted</u> <u>Stock Agreement</u>") with the same vesting schedule for such Shares as set forth for such Shares herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Transferability of Stock Option</u>. This Stock Option is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionee's lifetime only by the Optionee (or by the Optionee's guardian or personal representative in the event of the Optionee's incapacity). The Optionee may elect to designate a beneficiary by providing written notice of the name of such beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionee's Stock Option in the event of the Optionee's death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein in the event of the Optionee's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Restrictions on Transfer of Shares</u>. The Shares acquired upon exercise of the Stock Option shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan and, if applicable, the Restricted Stock Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Adjustments for Changes in Capital Structure</u>. If, as a result of any reorganization, recapitalization, reincorporation, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Class [A][F-1][F-2] Common Stock, the outstanding shares of Class [A][F-1][F-2] Common Stock are increased or decreased or are exchanged for a different number, class or kind of securities of the Company, the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, this Stock Option or Shares acquired pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Integration</u>. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes all prior agreements and discussions between the parties concerning such subject matter.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or this Stock Option, this Agreement, or the breach, termination or validity of the Plan, this Stock Option or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1 - 16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Optionee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 7 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Waiver of Statutory Information Rights</u>. The Optionee understands and agrees that, but for the waiver made herein, the Optionee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Optionee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Optionee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Optionee under any other written agreement between the Optionee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the date first above written.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |

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Address:

The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof, and understands that this Stock Option is subject to the terms of the Plan and of this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 7 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 8 OF THIS

AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| OPTIONEE: |
| Name: |
| Address: |

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| |
|:---|
| SPOUSE'S CONSENT |
| I acknowledge that I have read the<br> foregoing Non-Qualified Stock Option Agreement<br> and understand the contents thereof. |

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| |
|:---|
| DESIGNATED BENEFICIARY: |
| Beneficiary's Address: |

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**<u>Appendix A</u>**

**STOCK OPTION EXERCISE NOTICE** 

**EnCarda, Inc.** 

Attention: _____________________

_____________________________

_____________________________

Pursuant to the terms of the grant notice and stock option agreement between the undersigned and EnCarda, Inc. (the "<u>Company</u>") dated (the "<u>Agreement</u>") under the EnCarda, Inc. 2023 Stock Option and Grant Plan, I, [Insert Name] , hereby [Circle One] partially/fully exercise such option by including herein payment in the amount of

$ representing the purchase price for [Fill in number and class of Shares] Class [A]/[F-1]/[F-2] Shares. I have <u>chosen the following form(s) of payment:</u> 

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [ ] | 1. | Cash |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [ ] | 2. | Check payable to EnCarda, Inc. |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; [ ] | 3. | Other (as referenced in the Agreement and described in the Plan (please describe)) |  |
|  |  |  | . |

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In connection with my exercise of the option as set forth above, I hereby represent and warrant to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) I am purchasing the Shares for my own account for investment only, and not for resale or with a view to the distribution thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) I have had such an opportunity as I have deemed adequate to obtain from the Company such information as is necessary to permit me to evaluate the merits and risks of my investment in the Company and have consulted with my own advisers with respect to my investment in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the Shares and to make an informed investment decision with respect to such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) I can afford a complete loss of the value of the Shares and am able to bear the economic risk of holding such Shares for an indefinite period of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) I understand that the Shares may not be registered under the Securities Act of 1933 (it being understood that the Shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or "blue sky" laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Securities Act of 1933 and under any applicable state securities or "blue sky" laws (or exemptions from the registration requirement thereof). I further acknowledge that certificates representing Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated Shares will include similar restrictive notations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) To the extent required, I have executed and delivered to the Company the Restricted Stock Agreement attached as <u>Appendix B</u> to the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) I have read and understand the Plan and acknowledge and agree that the Shares are subject to all of the relevant terms of the Plan, including without limitation, the transfer restrictions set forth in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) I understand and agree that the Company has a right of first refusal with respect to the Shares pursuant to Section 9(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) I understand and agree that the Company has certain repurchase rights with respect to the Shares pursuant to Section 9(c) of the Plan.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) I understand and agree that I may not sell or otherwise transfer or dispose of the Shares for a period of time following the effective date of a public offering by the Company as described in Section 9(f) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) I understand and agree to the waiver of statutory information rights as set forth in Section 8 of the Agreement.

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| |
|:---|
| Sincerely yours, |
| Name: |
| Address: |
| Date: |

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**<u>Appendix B</u>**

**RESTRICTED STOCK AGREEMENT FOR EARLY EXERCISE OPTION** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Early Exercise Non-Qualified Stock Option Grant Notice (the "<u>Grant</u> <u>Notice</u>") and Early Exercise Non-Qualified Stock Option Agreement (the "Option Agreement") between EnCarda, Inc. (the "<u>Company</u>") and ___________________ (the "<u>Grantee</u>") for ________________ Shares of Class [A]/[F-1]/[F-2] Common Stock with a Grant Date of _____________, __________ under the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Purchase and Sale of Shares; Vesting</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Purchase and Sale</u>. The Company hereby sells to the Grantee, and the Grantee hereby purchases from the Company, _________________ on , 20[<u>__</u>], the number and class of Shares set forth in the Stock Option Exercise Notice (<u>_________</u> Shares) dated ______________, pursuant to the Grant Notice and Option Agreement, for the aggregate Option Exercise Price for the Shares so purchased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Vesting</u>. The risk of forfeiture shall lapse with respect to the Shares, and such Shares shall become vested, on the respective dates indicated on the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Repurchase Right</u>. Upon a Termination Event, the Company shall have the right to repurchase Shares of Restricted Stock that are unvested as of the date of such Termination Event as set forth in Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Restrictions on Transfer of Shares</u>. The Shares (whether or not vested) shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Restricted Stock Agreement shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Record Owner; Dividends</u>. The Grantee and any Permitted Transferees, during the duration of this Agreement, shall be considered the record owners of and shall be entitled to vote the Shares if and to the extent the Shares are entitled to voting rights. The Grantee and any Permitted Transferees shall be entitled to receive all dividends and any other distributions declared on the Shares; <u>provided</u>, <u>however</u>, that the Company is under no duty to declare any such dividends or to make any such distribution.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Section 83(b) Election</u>. The Grantee shall consult with the Grantee's tax advisor to determine whether it would be appropriate for the Grantee to make an election under Section 83(b) of the Code with respect to the Shares. Any such election must be filed with the Internal Revenue Service within 30 days of the date of exercise. If the Grantee makes an election under Section 83(b) of the Code, the Grantee shall give prompt notice to the Company (and provide a copy of such election to the Company). A sample Section 83(b) election is attached to this Agreement as Exhibit A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Grantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Grantee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or the Shares, this Agreement, or the breach, termination or validity of the Plan, the Shares or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1 - 16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Grantee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 6 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Waiver of Statutory Information Rights</u>. The Grantee understands and agrees that, but for the waiver made herein, the Grantee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Grantee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Grantee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Grantee under any other written agreement between the Grantee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Restricted Stock Agreement is hereby accepted and the terms and conditions thereof are hereby agreed to by the undersigned as of the date written in Section 1(a) above.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |

---

Address:

The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof and understands that the Shares purchased hereby are subject to the terms of the Plan, the Grant Notice, and this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 6 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 7 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| GRANTEE: |
| Name: |
| Address: |

---

------

SPOUSE'S CONSENT

I acknowledge that I have read the

foregoing Restricted Stock Agreement

and understand the contents thereof.

**EXHIBIT A** 

**Section 83(b) Election** 

The undersigned hereby elects pursuant to §83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this
election is being made are:

---

| |
|:---|
| Name: |
| Address: |
| Social Security No.: |
| Taxable Year: Calendar Year 20 |

---

2. The property which is the subject of this election is [number of unvested shares] shares of Class [A]/[F-1]/[F-2] common stock of EnCarda, Inc.

3. The property was transferred to the undersigned on [date of purchase/transfer].

4. The property is subject to the following restrictions:

The Shares will be subject to restrictions on transfer and risk of forfeiture upon termination of service relationship and in certain other events.

5. The fair market value of the property at time of transfer (determined without regard to any restrictions other
than nonlapse restrictions as defined in §1.83-3(h) of the Income Tax Regulations) is $[current FMV] per share x [number of unvested shares] shares =
$.

6. For the property transferred, the undersigned paid $[exercise price] per share x [number of unvested shares]
shares = $.

7. The amount to include in gross income is $[amount reported in Item 5 minus the amount reported in Item 6].

------

The undersigned taxpayer will file this election with the Internal Revenue Service Office with which the taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property, at the IRS address listed for the taxpayer's state under "Are you <u>not</u> including a check or money order . . ." given in *Where Do You File* in the Instructions for Form 1040 and the Instructions for Form 1040A (which information can also be found at: https://www.irs.gov/uac/where-to-file-addresses-for-taxpayers-and-tax-professionals). A copy of the election will also be furnished to the person for whom the services were performed. The undersigned is the person performing services in connection with which the property was transferred.

Dated:<u> </u>, 20 <br> Taxpayer

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**EARLY EXERCISE** 

**INCENTIVE STOCK OPTION GRANT NOTICE** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

Pursuant to the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"), EnCarda, Inc., a Delaware corporation (together with any successor thereto, the "<u>Company</u>"), has granted to the individual named below, an option (the "<u>Stock Option</u>") to purchase on or prior to the Expiration Date, or such earlier date as is specified herein, all or any part of the number of shares of Class [A]/[F-1][F-2] Common Stock, ("<u>Common Stock</u>"), of the Company indicated below (the "<u>Shares</u>"), at the Option Exercise Price per share, subject to the terms and conditions set forth in this Early Exercise Incentive Stock Option Grant Notice (the "<u>Grant Notice</u>"), the attached Early Exercise Incentive Stock Option Agreement (the "<u>Agreement</u>") and the Plan. This Stock Option is intended to qualify as an "incentive stock option" as defined in Section 422(b) of the Internal Revenue Code of 1986, as amended from time to time (the "<u>Code</u>"). To the extent that any portion of the Stock Option does not so qualify, it shall be deemed a non-qualified stock option.

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| | |
|:---|:---|
| Name of Optionee: | __________________ (the "<u>Optionee</u>") |
| No. of Shares: | __________ Shares of Class [A]/[F-1]/[F-2] Common Stock |
| Grant Date: |  |
| Vesting Commencement Date: | __________________ (the "<u>Vesting Commencement Date</u>") |
| Expiration Date: | __________________ (the "<u>Expiration Date</u>") |
| Option Exercise Price/Share: | $_________________ (the "<u>Option Exercise Price</u>") |
| Vesting Schedule: | [25]% of the Shares shall vest and become exercisable on the first anniversary of the Vesting Commencement Date; provided that the Optionee continues to have a Service Relationship with the Company at such time. Thereafter, the remaining [75]% of the Shares shall vest and become exercisable in [36] equal monthly installments following the first anniversary of the Vesting Commencement Date, provided the Optionee continues to have a Service Relationship with the Company on each vesting date. Notwithstanding anything in the Agreement to the contrary, in the case of a Sale Event, this Stock Option and the Shares shall be treated as provided in Section 3(c) of the Plan. |

---

**Attachments**: Early Exercise Incentive Stock Option Agreement, Restricted Stock Agreement, EnCarda, Inc. 2023 Stock Option and Grant Plan

------

**EARLY EXERCISE** 

**INCENTIVE STOCK OPTION AGREEMENT** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Grant Notice and the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Vesting, Exercisability and Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Stock Option shall be immediately exercisable, regardless of whether the Shares are vested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except as set forth below, and subject to the determination of the Committee in its sole discretion to accelerate the vesting schedule hereunder, the Shares shall be vested on the respective dates indicated below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) All Shares shall initially be unvested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Shares shall vest in accordance with the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Termination</u>. Except as may otherwise be provided by the Committee, if the Optionee's Service Relationship is terminated, the period within which to exercise this Stock Option will be subject to earlier termination as set forth below (and if not exercised within such period, shall thereafter terminate subject, in each case to Section 3(c) of the Plan):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Termination Due to Death or Disability</u>. If the Optionee's Service Relationship terminates by reason of such Optionee's death or Disability, this Stock Option may continue to be exercised, to the extent the Shares are vested on the date of termination, by the Optionee, the Optionee's legal representative or legatee for a period of 12 months from the date of death or Disability or until the Expiration Date, if earlier.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Other Termination</u>. If the Optionee's Service Relationship terminates for any reason other than death or Disability, and unless otherwise determined by the Committee, this Stock Option may continue to be exercised, to the extent the Shares are vested on the date of termination, for a period of 90 days from the date of termination or until the Expiration Date, if earlier; <u>provided</u> <u>however</u>, if the Optionee's Service Relationship is terminated for Cause, this Stock Option shall terminate immediately upon the date of such termination.

For purposes hereof, the Committee's determination of the reason for termination of the Optionee's Service Relationship shall be conclusive and binding on the Optionee and his or her representatives or legatees. Any portion of this Stock Option with respect to Shares that are not vested on the date of termination of the Service Relationship shall terminate immediately and be null and void.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) It is understood and intended that this Stock Option is intended to qualify as an "incentive stock option" as defined in Section 422 of the Code to the extent permitted under applicable law. Accordingly, the Optionee understands that in order to obtain the benefits of an incentive stock option under Section 422 of the Code, no sale or other disposition may be made of Shares for which incentive stock option treatment is desired within the one-year period beginning on the day after the day of the transfer of such Shares to him or her, nor within the two-year period beginning on the day after Grant Date of this Stock Option and further that this Stock Option must be exercised within three months after termination of employment as an employee (or 12 months in the case of death or disability) to qualify as an incentive stock option. If the Optionee disposes (whether by sale, gift, transfer or otherwise) of any such Shares within either of these periods, he or she will notify the Company within 30 days after such disposition. The Optionee also agrees to provide the Company with any information concerning any such dispositions required by the Company for tax purposes. Further, to the extent this Stock Option and any other incentive stock options of the Optionee having an aggregate Fair Market Value in excess of $100,000 (determined as of the Grant Date) first become exercisable in any year, such options will not qualify as incentive stock options.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Exercise of Stock Option</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Optionee may exercise this Stock Option only in the following manner: Prior to the Expiration Date, the Optionee may deliver a Stock Option exercise notice (an "<u>Exercise Notice</u>") in the form of <u>Appendix</u> <u>A</u> hereto indicating his or her election to purchase some or all of the Shares. Such notice shall specify the number and class of Shares to be purchased. To the extent this Stock Option is only partially exercised, such exercise shall first be with respect to the Shares, if any, that have previously vested, and then with respect to the Shares that will next vest, with the Shares that vest at the latest date being exercised last. Payment of the purchase price may be made by one or more of the methods described in Section 5 of the Plan, subject to the limitations contained in such Section of the Plan, including the requirement that the Committee specifically approve in advance certain payment methods.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event the Optionee exercises a portion of this Stock Option with respect to Shares that have not vested, the Optionee shall also deliver a Restricted Stock Agreement covering such unvested Shares in the form of <u>Appendix B</u> hereto (the "<u>Restricted Stock Agreement</u>") with the same vesting schedule for such Shares as set forth for such Shares herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding any other provision hereof or of the Plan, no portion of this Stock Option shall be exercisable after the Expiration Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Stock Option shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Transferability of Stock Option</u>. This Stock Option is personal to the Optionee and is not transferable by the Optionee in any manner other than by will or by the laws of descent and distribution. The Stock Option may be exercised during the Optionee's lifetime only by the Optionee (or by the Optionee's guardian or personal representative in the event of the Optionee's incapacity). The Optionee may elect to designate a beneficiary by providing written

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notice of the name of such beneficiary to the Company, and may revoke or change such designation at any time by filing written notice of revocation or change with the Company; such beneficiary may exercise the Optionee's Stock Option in the event of the Optionee's death to the extent provided herein. If the Optionee does not designate a beneficiary, or if the designated beneficiary predeceases the Optionee, the legal representative of the Optionee may exercise this Stock Option to the extent provided herein in the event of the Optionee's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Restrictions on Transfer of Shares</u>. The Shares acquired upon exercise of the Stock Option shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan and, if applicable, the Restricted Stock Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Adjustments for Changes in Capital Structure</u>. If, as a result of any reorganization, recapitalization, reincorporation, reclassification, stock dividend, stock split, reverse stock split or other similar change in the Class [A][F-1][F-2] Common Stock, the outstanding shares of Class [A][F-1][F-2] Common Stock are increased or decreased or are exchanged for a different number, class or kind of securities of the Company, the restrictions contained in this Agreement shall apply with equal force to additional and/or substitute securities, if any, received by the Optionee in exchange for, or by virtue of his or her ownership of, this Stock Option or Shares acquired pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Optionee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Optionee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, permitted assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Integration</u>. This Agreement constitutes the entire agreement between the parties with respect to this Stock Option and supersedes all prior agreements and discussions between the parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or this Stock Option, this Agreement, or the breach, termination or validity of the Plan, this Stock Option or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1—16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Optionee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 7 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Waiver of Statutory Information Rights</u>. The Optionee understands and agrees that, but for the waiver made herein, the Optionee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Optionee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Optionee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Optionee under any other written agreement between the Optionee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Agreement is hereby accepted and the terms and conditions thereof hereby agreed to by the undersigned as of the date first above written.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |
| Address: | Address: |

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The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof, and understands that this Stock Option is subject to the terms of the Plan and this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 7 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 8 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| OPTIONEE:<br>|
| <br> Name: |
| Address: |

---

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SPOUSE'S CONSENT

I acknowledge that I have read the

foregoing Incentive Stock Option Agreement

and understand the contents thereof.

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| |
|:---|
| DESIGNATED BENEFICIARY:<br>|
| Beneficiary's Address: |

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**<u>Appendix A</u>**

**STOCK OPTION EXERCISE NOTICE** 

---

| |
|:---|
| **EnCarda, Inc.** |
| Attention: |

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Pursuant to the terms of the grant notice and stock option agreement between the undersigned and EnCarda, Inc. (the "<u>Company</u>") dated __________ (the "<u>Agreement</u>") under the EnCarda, Inc. 2023 Stock Option and Grant Plan, I, [Insert Name] ________________, hereby [Circle One] partially/fully exercise such option by including herein payment in the amount of $______ representing the purchase price for [Fill in number and class of Shares] ______ Class [A/F-1/F-2] Shares. I have chosen the following form(s) of payment:

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| | | |
|:---|:---|:---|
| [ ] | 1. | Cash |
| [ ] | 2. | Check payable to EnCarda, Inc. |
| [ ] | 3. | Other (as referenced in the Agreement and described in the Plan (please describe)) |

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_____________________________________________________.

In connection with my exercise of the option as set forth above, I hereby represent and warrant to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) I am purchasing the Shares for my own account for investment only, and not for resale or with a view to the distribution thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) I have had such an opportunity as I have deemed adequate to obtain from the Company such information as is necessary to permit me to evaluate the merits and risks of my investment in the Company and have consulted with my own advisers with respect to my investment in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) I have sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the Shares and to make an informed investment decision with respect to such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) I can afford a complete loss of the value of the Shares and am able to bear the economic risk of holding such Shares for an indefinite period of time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) I understand that the Shares may not be registered under the Securities Act of 1933 (it being understood that the Shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or "blue sky" laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Securities Act of 1933 and under any applicable state securities or "blue sky" laws (or exemptions from the registration requirement thereof). I further acknowledge that certificates representing Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated Shares will include similar restrictive notations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) To the extent required, I have executed and delivered to the Company the Restricted Stock Agreement attached as <u>Appendix B</u> to the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) I have read and understand the Plan and acknowledge and agree that the Shares are subject to all of the relevant terms of the Plan, including without limitation, the transfer restrictions set forth in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) I understand and agree that the Company has a right of first refusal with respect to the Shares pursuant to Section 9(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) I understand and agree that the Company has certain repurchase rights with respect to the Shares pursuant to Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) I understand and agree that I may not sell or otherwise transfer or dispose of the Shares for a period of time following the effective date of a public offering by the Company as described in Section 9(f) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) I understand and agree to the waiver of statutory information rights as set forth in Section 8 of the Agreement.

Sincerely yours, <br> Name:

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| |
|:---|
| Address: |
| Date: |

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**<u>Appendix B</u>**

**RESTRICTED STOCK AGREEMENT FOR EARLY EXERCISE OPTION** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Early Exercise Incentive Stock Option Grant Notice (the "<u>Grant Notice</u>") and Early Exercise Incentive Stock Option Agreement (the "<u>Option Agreement</u>") between EnCarda, Inc. (the "<u>Company</u>") and _______________ (the "<u>Grantee</u>") for __________________ Shares of Class [A]/[F-1]/[F-2] Common Stock with a Grant Date of ___________, ______ under the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Purchase and Sale of Shares; Vesting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Purchase and Sale</u>. The Company hereby sells to the Grantee, and the Grantee hereby purchases from the Company, on ________________, 20[__],the number and class of Shares set forth in the Stock Option Exercise Notice (________ Shares) dated __________ , pursuant to the Grant Notice and Option Agreement, for the aggregate Option Exercise Price for the Shares so purchased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Vesting</u>. The risk of forfeiture shall lapse with respect to the Shares, and such Shares shall become vested, on the respective dates indicated on the Vesting Schedule set forth in the Grant Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Repurchase Right</u>. Upon a Termination Event, the Company shall have the right to repurchase the Shares of Restricted Stock that are unvested as of the date of such Termination Event as set forth in Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Restrictions on Transfer of Shares</u>. The Shares (whether or not vested) shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Restricted Stock Agreement shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Record Owner; Dividends</u>. The Grantee and any Permitted Transferees, during the duration of this Agreement, shall be considered the record owners of and shall be entitled to vote the Shares if and to the extent the Shares are entitled to voting rights. The Grantee and any Permitted Transferees shall be entitled to receive all dividends and any other distributions declared on the Shares; <u>provided</u>, <u>however</u>, that the Company is under no duty to declare any such dividends or to make any such distribution.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Section 83(b) Election</u>. The Grantee shall consult with the Grantee's tax advisor to determine whether it would be appropriate for the Grantee to make an election under Section 83(b) of the Code with respect to the Shares. Any such election must be filed with the Internal Revenue Service within 30 days of the date of exercise. If the Grantee makes an election under Section 83(b) of the Code, the Grantee shall give prompt notice to the Company (and provide a copy of such election to the Company). A sample Section 83(b) election is attached to this Agreement as Exhibit A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Grantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Grantee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or the Shares, this Agreement, or the breach, termination or validity of the Plan, the Shares or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1—16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Grantee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 6 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Waiver of Statutory Information Rights</u>. The Grantee understands and agrees that, but for the waiver made herein, the Grantee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Grantee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Grantee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Grantee under any other written agreement between the Grantee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Restricted Stock Agreement is hereby accepted and the terms and conditions thereof are hereby agreed to by the undersigned as of the date written in Section 1(a) above.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |
| Address: | Address: |

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The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof and understands that the Shares purchased hereby are subject to the terms of the Plan, the Grant Notice, and this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Grant Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 6 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 7 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| GRANTEE: |
| Name: |
| Address: |

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| |
|:---|
| SPOUSE'S CONSENT |
| I acknowledge that I have read the<br> foregoing Restricted Stock Agreement<br> and understand the contents thereof. |

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**EXHIBIT A** 

**Section 83(b) Election** 

The undersigned hereby elects pursuant to §83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this
election is being made are:

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| |
|:---|
| Name: |
| Address: |
| Social Security No.: |
| Taxable Year: Calendar Year 20__ |

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2. The property which is the subject of this election is [number of unvested shares] shares of Class [A]/[F-1]/[F-2] common stock of EnCarda, Inc.

3. The property was transferred to the undersigned on [date of purchase/transfer].

4. The property is subject to the following restrictions:

The Shares will be subject to restrictions on transfer and risk of forfeiture upon termination of service relationship and in certain other events.

5. The fair market value of the property at time of transfer (determined without regard to any restrictions other
than nonlapse restrictions as defined in §1.83-3(h) of the Income Tax Regulations) is $[current FMV] per share x [number of unvested shares] shares = $_______________.

6. For the property transferred, the undersigned paid $[exercise price] per share x [number of unvested shares]
shares = $_________________.

7. The amount to include in gross income is $[amount reported in Item 5 minus the amount reported in Item 6].

The undersigned taxpayer will file this election with the Internal Revenue Service Office with which the taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property, at the IRS address listed for the taxpayer's state under "Are you <u>not</u> including a check or money order . . ." given in *Where Do You File* in the Instructions for Form 1040 and the Instructions for Form 1040A (which information can also be found at: https://www.irs.gov/uac/where-to-file-addresses-for-taxpayers-and-tax-professionals). A copy of the election will also be furnished to the person for whom the services were performed. The undersigned is the person performing services in connection with which the property was transferred.

Dated: __________________, 20__ <br> Taxpayer

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**RESTRICTED STOCK AWARD NOTICE** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

Pursuant to the EnCarda, Inc. 2023 Stock Option and Grant Plan (the "<u>Plan</u>"), EnCarda, Inc., a Delaware corporation (together with any successor, the "<u>Company</u>"), hereby grants, sells and issues to the individual named below, the Shares at the Per Share Purchase Price, subject to the terms and conditions set forth in this Restricted Stock Award Notice (the "<u>Award Notice</u>"), the attached Restricted Stock Agreement (the "<u>Agreement</u>") and the Plan. The Grantee agrees to the provisions set forth herein and acknowledges that each such provision is a material condition of the Company's agreement to issue and sell the Shares to him or her. The Company hereby acknowledges receipt of $[_____] in full payment for the Shares. All references to share prices and amounts herein shall be equitably adjusted to reflect stock splits, stock dividends, recapitalizations, reclassifications, mergers, reorganizations and similar changes affecting the capital stock of the Company, and any shares of capital stock of the Company received on or in respect of Shares in connection with any such event (including any shares of capital stock or any right, option or warrant to receive the same or any security convertible into or exchangeable for any such shares or received upon conversion of any such shares) shall be subject to this Agreement on the same basis and extent at the relevant time as the Shares in respect of which they were issued, and shall be deemed Shares as if and to the same extent they were issued at the date hereof.

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| | |
|:---|:---|
| Name of Grantee: | _________________ (the "<u>Grantee</u>") |
| No. of Shares: | _________ Shares of Class [A]/[F-1]/[F-2] Common Stock (the "<u>Shares</u>") |
| Grant Date: | ____________ __, ____ |
| Date of Purchase of Shares: | ____________ __, ____ |
| Vesting Commencement Date: | ____________ __, ____ (the "<u>Vesting Commencement Date</u>") |
| Per Share Purchase Price: | $________ (the "<u>Per Share Purchase Price</u>") |
| Vesting Schedule: | [25]% of the Shares shall vest on the [first] anniversary of the Vesting Commencement Date; provided that the Grantee continues to have a Service Relationship with the Company at such time. Thereafter, the remaining [75]% of the Shares shall vest in [36] equal monthly installments following the first anniversary of the Vesting Commencement Date, provided the Grantee continues to have a Service Relationship with the Company at such time. Notwithstanding anything in the Agreement to the contrary in the case of a Sale Event, the Shares of Restricted Stock shall be treated as provided in Section 3(c) of the Plan. |

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Attachments: Restricted Stock Agreement, EnCarda, Inc. 2023 Stock Option and Grant Plan

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**RESTRICTED STOCK AGREEMENT** 

**UNDER THE ENCARDA, INC.** 

**2023 STOCK OPTION AND GRANT PLAN** 

All capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Award Notice and the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Purchase and Sale of Shares; Vesting; Investment Representations</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Purchase and Sale</u>. The Company hereby sells to the Grantee, and the Grantee hereby purchases from the Company, the number of Shares set forth in the Award Notice for the Per Share Purchase Price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Vesting</u>. Initially, all of the Shares are non-transferable and subject to a substantial risk of forfeiture and are Shares of Restricted Stock. The risk of forfeiture shall lapse with respect to the Shares on the respective dates indicated on the Vesting Schedule set forth in the Award Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Investment Representations</u>. In connection with the purchase and sale of the Shares contemplated by Section 1(a) above, the Grantee hereby represents and warrants to the Company as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Grantee is purchasing the Shares for the Grantee's own account for investment only, and not for resale or with a view to the distribution thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Grantee has had such an opportunity as he or she has deemed adequate to obtain from the Company such information as is necessary to permit him or her to evaluate the merits and risks of the Grantee's investment in the Company and has consulted with the Grantee's own advisers with respect to the Grantee's investment in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Grantee has sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the purchase of the Shares and to make an informed investment decision with respect to such purchase.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Grantee can afford a complete loss of the value of the Shares and is able to bear the economic risk of holding such Shares for an indefinite period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) The Grantee understands that the Shares are not registered under the Act (it being understood that the Shares are being issued and sold in reliance on the exemption provided in Rule 701 thereunder) or any applicable state securities or "blue sky" laws and may not be sold or otherwise transferred or disposed of in the absence of an effective registration statement under the Act and under any applicable state securities or "blue sky" laws (or exemptions from the registration requirements thereof). The Grantee further acknowledges that certificates representing the Shares will bear restrictive legends reflecting the foregoing and/or that book entries for uncertificated Shares will include similar restrictive notations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) The Grantee has read and understands the Plan and acknowledges and agrees that the Shares are subject to all of the relevant terms of the Plan, including without limitation, the transfer restrictions set forth in Section 9 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The Grantee understands and agrees that the Company has a right of first refusal with respect to the Shares pursuant to Section 9(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) The Grantee understands and agree that the Company has certain repurchase rights with respect to the Shares pursuant to Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) The Grantee understands and agrees that the Grantee may not sell or otherwise transfer or dispose of the Shares for a period of time following the effective date of a public offering by the Company as described in Section 9(f) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Repurchase Right</u>. Upon a Termination Event, the Company shall have the right to repurchase Shares of Restricted Stock that are unvested as of the date of such Termination Event as set forth in Section 9(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Restrictions on Transfer of Shares</u>. The Shares (whether or not vested) shall be subject to certain transfer restrictions and other limitations including, without limitation, the provisions contained in Section 9 of the Plan

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Incorporation of Plan</u>. Notwithstanding anything herein to the contrary, this Restricted Stock Award shall be subject to and governed by all the terms and conditions of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Miscellaneous Provisions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Record Owner; Dividends</u>. The Grantee and any Permitted Transferees, during the duration of this Agreement, shall be considered the record owners of and shall be entitled to vote the Shares if and to the extent the Shares are entitled to voting rights. The Grantee and any Permitted Transferees shall be entitled to receive all dividends and any other distributions declared on the Shares; <u>provided</u>, <u>however</u>, that the Company is under no duty to declare any such dividends or to make any such distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Section 83(b) Election</u>. The Grantee shall consult with the Grantee's tax advisor to determine whether it would be appropriate for the Grantee to make an election under Section 83(b) of the Code with respect to this Award. Any such election must be filed with the Internal Revenue Service within 30 days of the date of this Award. If the Grantee makes an election under Section 83(b) of the Code, the Grantee shall give prompt notice to the Company (and provide a copy of such election to the Company). A sample Section 83(b) election is attached to this Agreement as Exhibit A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Equitable Relief</u>. The parties hereto agree and declare that legal remedies may be inadequate to enforce the provisions of this Agreement and that equitable relief, including specific performance and injunctive relief, may be used to enforce the provisions of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Change and Modifications</u>. This Agreement may not be orally changed, modified or terminated, nor shall any oral waiver of any of its terms be effective. This Agreement may be changed, modified or terminated only by an agreement in writing signed by the Company and the Grantee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Governing Law</u>. This Agreement shall be governed by and construed in accordance with the internal laws of Delaware, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Headings</u>. The headings are intended only for convenience in finding the subject matter and do not constitute part of the text of this Agreement and shall not be considered in the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Saving Clause</u>. If any provision(s) of this Agreement shall be determined to be illegal or unenforceable, such determination shall in no manner affect the legality or enforceability of any other provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Notices</u>. All notices, requests, consents and other communications shall be in writing and be deemed given when delivered personally, by telex or facsimile transmission or when received if mailed by first class registered or certified mail, postage prepaid. Notices to the Company or the Grantee shall be addressed as set forth underneath their signatures below, or to such other address or addresses as may have been furnished by such party in writing to the other.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Benefit and Binding Effect</u>. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective successors, assigns, and legal representatives. The Company has the right to assign this Agreement, and such assignee shall become entitled to all the rights of the Company hereunder to the extent of such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Counterparts</u>. For the convenience of the parties and to facilitate execution, this Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>Integration</u>. This Agreement constitutes the entire agreement between the parties with respect to this Award and supersedes all prior agreements and discussions between the parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Dispute Resolution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as provided below, any dispute arising out of or relating to the Plan or the Shares, this Agreement, or the breach, termination or validity of the Plan, the Shares or this Agreement, shall be finally settled by binding arbitration conducted expeditiously in accordance with the J.A.M.S./Endispute Comprehensive Arbitration Rules and Procedures (the "<u>J.A.M.S. Rules</u>"). The arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. Sections 1—16, and judgment upon the award rendered by the arbitrators may be entered by any court having jurisdiction thereof.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The arbitration shall commence within 60 days of the date on which a written demand for arbitration is filed by any party hereto. In connection with the arbitration proceeding, the arbitrator shall have the power to order the production of documents by each party and any third-party witnesses. In addition, each party may take up to three depositions as of right, and the arbitrator may in his or her discretion allow additional depositions upon good cause shown by the moving party. However, the arbitrator shall not have the power to order the answering of interrogatories or the response to requests for admission. In connection with any arbitration, each party to the arbitration shall provide to the other, no later than seven business days before the date of the arbitration, the identity of all persons that may testify at the arbitration and a copy of all documents that may be introduced at the arbitration or considered or used by a party's witness or expert. The arbitrator's decision and award shall be made and delivered within six months of the selection of the arbitrator. The arbitrator's decision shall set forth a reasoned basis for any award of damages or finding of liability. The arbitrator shall not have power to award damages in excess of actual compensatory damages and shall not multiply actual damages or award punitive damages, and each party hereby irrevocably waives any claim to such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Company, the Grantee, each party to the Agreement and any other holder of Shares issued pursuant to this Agreement (each, a "<u>Party</u>") covenants and agrees that such party will participate in the arbitration in good faith. This Section 6 applies equally to requests for temporary, preliminary or permanent injunctive relief, except that in the case of temporary or preliminary injunctive relief any party may proceed in court without prior arbitration for the limited purpose of avoiding immediate and irreparable harm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Each Party (i) hereby irrevocably submits to the jurisdiction of any United States District Court of competent jurisdiction for the purpose of enforcing the award or decision in any such proceeding, (ii) hereby waives, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above named courts, that its property is exempt or immune from attachment or execution (except as protected by applicable law), that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court, and (iii) hereby waives and agrees not to seek any review by any court of any other jurisdiction which may be called upon to grant an enforcement of the judgment of any such court. Each Party hereby consents to service of process by registered mail at the address to which notices are to be given. Each Party agrees that its, his or her submission to jurisdiction and its, his or her consent to service of process by mail is made for the express benefit of each other Party. Final judgment against any Party in any such action, suit or proceeding may be enforced in other jurisdictions by suit, action or proceeding on the judgment, or in any other manner provided by or pursuant to the laws of such other jurisdiction.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Waiver of Statutory Information Rights</u>. The Grantee understands and agrees that, but for the waiver made herein, the Grantee would be entitled, upon written demand under oath stating the purpose thereof, to inspect for any proper purpose, and to make copies and extracts from, the Company's stock ledger, a list of its stockholders, and its other books and records, and the books and records of subsidiaries of the Company, if any, under the circumstances and in the manner provided in Section 220 of the General Corporation Law of Delaware (any and all such rights, and any and all such other rights of the Grantee as may be provided for in Section 220, the "<u>Inspection Rights</u>"). In light of the foregoing, until the first sale of Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under the Securities Act, the Grantee hereby unconditionally and irrevocably waives the Inspection Rights, whether such Inspection Rights would be exercised or pursued directly or indirectly pursuant to Section 220 or otherwise, and covenants and agrees never to directly or indirectly commence, voluntarily aid in any way, prosecute, assign, transfer, or cause to be commenced any claim, action, cause of action, or other proceeding to pursue or exercise the Inspection Rights. The foregoing waiver shall not affect any rights of a director, in his or her capacity as such, under Section 220. The foregoing waiver shall not apply to any contractual inspection rights of the Grantee under any other written agreement between the Grantee and the Company.

[SIGNATURE PAGE FOLLOWS]

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The foregoing Restricted Stock Agreement is hereby accepted and the terms and conditions thereof are hereby agreed to by the undersigned as of the date of purchase of Shares above written.

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| | |
|:---|:---|
| **ENCARDA, INC.** | **ENCARDA, INC.** |
| By: |  |
|  | Name: |
|  | Title: |
| Address: | Address: |

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The undersigned hereby acknowledges receiving and reviewing a copy of the Plan, including, without limitation, Section 9 thereof and understands that the Shares granted hereby are subject to the terms of the Plan and of this Agreement. This Agreement is hereby accepted, and the terms and conditions of the Plan, the Award Notice and this Agreement, SPECIFICALLY INCLUDING THE ARBITRATION PROVISIONS SET FORTH IN SECTION 6 AND THE WAIVER OF STATUTORY INFORMATION RIGHTS SET FORTH IN SECTION 7 OF THIS AGREEMENT, are hereby agreed to, by the undersigned as of the date first above written.

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| |
|:---|
| GRANTEE: |
| Name: |
| Address: |

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| |
|:---|
| SPOUSE'S CONSENT |
| I acknowledge that I have read the<br> foregoing Restricted Stock Agreement<br> and understand the contents thereof. |

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**EXHIBIT A** 

**Section 83(b) Election** 

The undersigned hereby elects pursuant to §83(b) of the Internal Revenue Code of 1986, as amended, to include in gross income as compensation for services the excess (if any) of the fair market value of the shares described below over the amount paid for those shares.

1. The name, taxpayer identification number, address of the undersigned, and the taxable year for which this
election is being made are:

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| |
|:---|
| Name: |
| Address: |
| Social Security No.: |
| Taxable Year: Calendar Year 20__ |

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2. The property which is the subject of this election is [number of unvested shares] shares of Class [A]/[F-1]/[F-2] common stock of EnCarda, Inc.

3. The property was transferred to the undersigned on [date of purchase/transfer].

4. The property is subject to the following restrictions:

The Shares will be subject to restrictions on transfer and risk of forfeiture upon termination of service relationship and in certain other events.

5. The fair market value of the property at time of transfer (determined without regard to any restrictions other
than nonlapse restrictions as defined in §1.83-3(h) of the Income Tax Regulations) is $[current FMV] per share x [number of unvested shares] shares = $_______________.

6. For the property transferred, the undersigned paid $[exercise price] per share x [number of unvested shares]
shares = $_________________.

7. The amount to include in gross income is $[amount reported in Item 5 minus the amount reported in Item 6].

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The undersigned taxpayer will file this election with the Internal Revenue Service Office with which the taxpayer files his or her annual income tax return not later than 30 days after the date of transfer of the property, at the IRS address listed for the taxpayer's state under "Are you <u>not</u> including a check or money order . . ." given in *Where Do You File* in the Instructions for Form 1040 and the Instructions for Form 1040A (which information can also be found at: https://www.irs.gov/uac/where-to-file-addresses-for-taxpayers-and-tax-professionals). A copy of the election will also be furnished to the person for whom the services were performed. The undersigned is the person performing services in connection with which the property was transferred.

Dated: __________________, 20__ <br> Taxpayer

## Exhibit 10.9

**Exhibit 10.9** 

February 24, 2025

Tassos Gianakakos

Dear Tassos,

As you may know, Kardigan, Inc., a Delaware corporation (the "<u>Kardigan</u>"), entered into an Agreement and Plan of Merger (the "<u>Merger Agreement</u>"), dated February 24, 2025, by and among the Company, Pullover Mergersub, Inc., a Delaware corporation ("<u>MergerSub</u>"), Prolaio, Inc., a Delaware corporation (the "<u>Company</u>"), and certain other parties pursuant to which the Company shall become a wholly owned subsidiary of Kardigan. Capitalized terms not defined herein shall have the meanings ascribed in the Merger Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. <u>Capital Stock Bonus</u>**. Subject to and conditioned upon the Closing, upon the successful completion of the Integration (as defined below) (the date Kardigan's board of directors makes a determination that the Integration has been successfully completed, the "<u>Milestone Date</u>"), so long as you are providing services to Kardigan or its subsidiaries as an employee or consultant on both the Milestone Date and the Milestone Payment Date (as defined below), Kardigan will pay to you a bonus in the amount of $9,000,000 (the "<u>Base Bonus</u>") <u>plus</u> the Gross-Up Amount (as defined below) (together the "<u>Bonus</u>"), subject to and in accordance with the terms of this letter agreement. The Bonus shall be paid to you within sixty (60) days of the later of (i) the Milestone Date and (ii) the Next Financing Transaction (the latest to occur of the date in clause (i) or clause (ii) is referred to herein as the "<u>Milestone Payment Date</u>") in a number of shares of Applicable Capital Stock determined by dividing the Bonus by the Applicable Stock Price; provided, however, that the Milestone Payment Date must occur on or prior to the Expiration Date (as defined below). Notwithstanding the foregoing, in the event of a Deemed Liquidation Event (as defined in Kardigan's Certificate of Incorporation, as amended, restated or modified from time to time) prior to the Milestone Payment Date and prior to the Expiration Date, the Bonus shall be paid to you in cash within sixty (60) days of the consummation of such Deemed Liquidation Event, provided that you are providing services to Kardigan or its subsidiaries as an employee or consultant through the date of such Deemed Liquidation Event. For the avoidance of doubt, in the event that neither the Milestone Payment Date nor a Deemed Liquidation Event occurs on or prior to the Expiration Date, the Bonus shall be forfeited by you as of the Expiration Date without any payment of consideration thereof and you shall have no further rights or interests under this letter agreement.

Notwithstanding the foregoing, if your services are terminated without Cause (as defined below) or if you terminate your services for Good Reason (as defined below), in either case after the Milestone Date but prior to the Milestone Payment Date, you shall remain eligible to receive the Bonus upon the occurrence of the Next Financing Transaction (or, if earlier, a Deemed Liquidation Event) as described herein; provided, however, your right to receive the Bonus following any such termination shall be subject to your execution and non-revocation of a general release of claims in favor of Kardigan in a form acceptable to Kardigan (the "<u>Release</u>"), which Release shall become effective within sixty (60) days following the date of your termination.

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As used in this Section 1:

"<u>Alternative Financing Transaction</u>" means any equity financing transaction in which the stockholders of Kardigan receive securities in a company that is publicly listed on the Nasdaq Stock Market, the New York Stock Exchange or another marketplace or exchange approved by Kardigan's board of directors, including, without limitation, a reverse merger transaction or a deSPAC business combination with a concurrent PIPE.

"<u>Applicable Capital Stock</u>" means (i) Kardigan's Common Stock issued in Kardigan's IPO (if the Next Financing Transaction is Kardigan's IPO), (ii) the series of preferred stock issued by Kardigan to investors in Kardigan's Next Preferred Stock Financing (if the Next Financing Transaction is Kardigan's Next Preferred Stock Financing), or (iii) the publicly-listed securities that stockholders of Kardigan receive in an Alternative Financing Transaction (if the Next Financing Transaction is an Alternative Financing Transaction).

"<u>Applicable Stock Price</u>" means (i) the per share offering price to the public of Kardigan's Common Stock set forth on the cover of the final prospectus for Kardigan's IPO if the Next Financing Transaction is Kardigan's IPO, (ii) the lowest purchase price per share of Kardigan's Preferred Stock sold for cash in Kardigan's Next Preferred Stock Financing if the Next Financing Transaction is Kardigan's Next Preferred Stock Financing, or (iii) the fair market value per share of the publicly-listed securities that stockholders of Kardigan received in an Alternative Financing Transaction as of the closing date of such Alternative Financing Transaction if the Next Financing Transaction is an Alternative Financing Transaction.

"<u>Cause" means any of the following:</u>

your conduct constituting a material act of misconduct in connection with the performance of your duties, including, without limitation, (A) willful failure or refusal to perform material responsibilities that have been requested by Kardigan; (B) dishonesty to Kardigan with respect to any material matter; or (C) misappropriation of funds or property of Kardigan or any of its subsidiaries or affiliates other than the occasional, customary and *de minimis* use of Kardigan property for personal purposes;

your commission of certain acts satisfying the elements of (A) any felony or (B) a misdemeanor involving moral turpitude, deceit, dishonesty or fraud;

your misconduct, regardless of whether or not in the course of your services, that would reasonably be expected to result in material injury or reputational harm to Kardigan or any of its subsidiaries or affiliates if you were to continue to provide services in the same position;

continued non-performance of your duties hereunder (other than by reason of your physical or mental illness, incapacity or disability) which has continued for more than 10 business days following written notice of such non-performance from Kardigan;

a material violation of any of Kardigan's written employment policies by you; or

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your failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by Kardigan to cooperate, or the willful destruction or failure to preserve documents or other materials known to be relevant to such investigation or the inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation.

"<u>Expiration Date</u>" means February 24, 2032.

"<u>Good Reason</u>" means that you have completed all steps of the Good Reason Process (as defined below) following the occurrence of any of the following events without your consent (each, a "<u>Good Reason Condition</u>")

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a material diminution in your responsibilities, authority or duties;

a material diminution in your base salary except for across-the-board salary reductions based on Kardigan's financial performance similarly affecting all or substantially all senior management employees of Kardigan; or

the requirement that you report other than to Kardigan's board of directors.

"<u>Good Reason Process</u>" consists of the following steps:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) you reasonably determine in good faith that a Good Reason Condition has occurred;

you notify Kardigan in writing of the first occurrence of the Good Reason Condition within 60 days of the first occurrence of such condition;

you cooperate in good faith with Kardigan's efforts, for a period of not less than 30 days following such notice (the "<u>Cure Period</u>"), to remedy the Good Reason Condition;

notwithstanding such efforts, the Good Reason Condition continues to exist at the end of the Cure Period; and

you terminate your services within 60 days after the end of the Cure Period.

If Kardigan cures the Good Reason Condition during the Cure Period, Good Reason shall be deemed not to have occurred.

"<u>Integration</u>" means the assumption by Kardigan of the Company's general and administrative functions, consisting of the Company's finance and accounting systems,

HR and payroll systems, and IT systems, as determined in good faith by Kardigan's board of directors.

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"<u>Kardigan's Next Preferred Stock Financing</u>" means a bona fide transaction or series of transactions following the Closing with the principal purpose of raising capital, pursuant to which Kardigan issues and sells a newly authorized series of preferred stock ("<u>Kardigan's Preferred Stock</u>") at a fixed valuation. For the avoidance of doubt, any sale of Kardigan's Series A Preferred Stock shall not be deemed Kardigan's Next Preferred Stock Financing.

"<u>Kardigan's IPO</u>" means the closing of Kardigan's first sale of its Common Stock to the public in a firm commitment underwritten initial public offering pursuant to a registration statement on Form S-1 or Form SB-2 under the Securities Act of 1933, as amended.

"<u>Next Financing Transaction</u>" means the earlier to occur of (i) Kardigan's Next Preferred Stock Financing, (ii) Kardigan's IPO or (iii) any Alternative Financing Transaction.

In the event that after the Next Financing Transaction or a Deemed Liquidation Event and prior to the issuance of the Applicable Capital Stock there is (i) a subdivision, split, dividend payable in shares, reverse-split, or similar adjustment applicable to the Applicable Capital Stock or (ii) the Applicable Capital Stock is exchanged, reclassified, converted or subject to similar adjustment, appropriate adjustment shall be made to the Applicable Capital Stock and Applicable Stock Price for purposes of this letter agreement so that you will receive property, securities or other rights with a fair market value equivalent to the Applicable Capital Stock that you would have received at the Applicable Stock prior to any such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. <u>Gross Up</u>**. In addition to the $9,000,000 Base Bonus set forth above, Kardigan shall make an additional bonus payment (the "<u>Gross-Up Payment</u>" and the amount of such Gross-Up Payment, the "<u>Gross-Up Amount</u>" payable as described above) to you to cover a portion of all applicable federal, state and local income and employment taxes applicable to your Bonus such that the net amount received by you after all such income and employment taxes are paid (including, without limitation, any and all income and employment taxes withheld and paid over to the applicable taxing authority on your behalf and taking into account any incremental income and employment taxes imposed on such Gross-Up Payment) is equal to the net amount you would have received if the Base Bonus were instead subject to tax at applicable long-term capital gain rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. <u>Loan</u>**. In the event that the shares of Applicable Capital Stock issued to you are issued on the Next Financing Transaction are not Freely Tradeable Shares, subject to compliance with applicable law (including the Sarbanes-Oxley Act of 2002, as amended ("<u>SOX</u>")), Kardigan shall loan to you an amount necessary to cover all applicable federal, state and local taxes applicable to your Bonus (the "<u>Loan</u>"). The Loan shall bear interest at the applicable federal rates published by the Internal Revenue Service, and shall mature and all amounts owed under the Loan shall be due and payable upon the earliest to occur of (i) the tenth anniversary of the Loan, (ii) a Deemed Liquidation Event and (iii) immediately before any event or transaction, as a result of which, the lending relationship evidenced thereby would be prohibited by applicable law, including, without limitation, under Section 13(k) of the Securities Act of 1934, as amended. In addition, any proceeds from the sales of any Applicable Capital Stock (or any securities or other property into which the Applicable Capital Stock may be exchanged, reclassified or converted) held by you or any distributions thereon shall be used to repay the principal and accrued interest under the Loan (with each such payment applied first to any accrued interest and second to any outstanding principal). The Loan shall be evidenced by a customary note agreement (and applicable pledge or security documents), with a minimum of 50% personal recourse, prepared by

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Kardigan in good faith. The Applicable Capital Stock shall be pledged by you as security for your obligations under the Loan, including without limitation the timely payment of the principal and interest under the Loan, and all certificates or instruments representing or evidencing the Applicable Capital Stock shall be delivered to and held by Kardigan and shall be accompanied by duly executed instruments of transfer or assignment in blank, all in form and substance satisfactory to Kardigan. For the avoidance of doubt, if a Deemed Liquidation Event is the payment event for the Bonus, no Loan will be issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4. <u>Tax Determination</u>**. For purposes of calculating your income taxes for the Gross- Up Payment and the amount of the Loan, Kardigan shall apply the highest applicable marginal tax rates and long-term capital gains rate (as applicable) in each applicable jurisdiction that apply to you. All determinations required to be made with respect to the Gross-Up Payment and the Loan, including the Gross-Up Amount, the amount of the Loan and applicable tax rates, shall be made by the board of directors of Kardigan in good faith and reasonable discretion after consultation with you. Any good faith determination by the board of directors of Kardigan with respect to any such matters shall be binding upon Kardigan and you. The Bonus and Gross-Up Payment, if any, shall be subject to your satisfaction of any applicable withholding taxes on your behalf and subject to Kardigan's normal payroll processes and procedures, which may be subtracted from the Bonus and Gross-Up Payment to the extent (A) the Loan is prohibited under applicable law (including by Kardigan withholding shares of the Applicable Capital Stock otherwise payable to you with a fair market value on the date of issuance equal to the applicable tax withholding obligation) and (B) you elect not to advance cash for the applicable withholding taxes to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. <u>Section 409A</u>**. The provisions regarding all payments to be made hereunder shall be administered such that all payments shall be exempt from or comply with Section 409A of the Internal Revenue Code and the regulations and guidance promulgated under the Internal Revenue Code ("<u>Section</u> <u>409A</u>"). To the extent that any payment to be made under this letter agreement is subject to Section 409A and any provision of this letter agreement is ambiguous as to its compliance with Section 409A, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A. For purposes of Section 409A, your right to receive any installment payments pursuant to this letter agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this letter agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company. The parties agree that this letter agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party. Notwithstanding the foregoing, Kardigan makes no representations that the payments and benefits provided pursuant to this letter agreement comply with or are exempt from Section 409A and in no event shall Kardigan be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by you on account of non-compliance with Section 409A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. <u>Employment At-Will Status</u>**. Nothing in this letter agreement alters the at-will status of your employment with Kardigan or its subsidiaries and Kardigan and its subsidiaries may terminate your employment or service at any time.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7. <u>Confidentiality</u>**. You agree that you will not disclose to any person or third party, other than on a confidential basis to your immediate family and your legal and/or financial advisors, the fact that Kardigan has entered into this letter agreement with you or the terms and conditions of this letter agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8. <u>Successors and Assigns</u>**. This letter agreement shall be binding upon and shall insure to the benefit of the successors, assigns, personal representatives, heirs and legatees of the respective parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9. <u>Unfunded Obligation</u>**. Nothing in this letter agreement shall require Kardigan or its subsidiaries, for purposes of satisfying any obligations under this letter agreement, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor shall Kardigan or any of its subsidiaries maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately maintained or administered fund for such purposes. Prior to the payment to you of the Bonus, you shall have no rights under this letter agreement other than as an unsecured general creditor of Kardigan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10. <u>Integration</u>**. This letter agreement constitutes the entire agreement between Kardigan and you with respect to the subject matter hereof and supersedes all prior agreements and discussions between such parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11. <u>Miscellaneous</u>**. This letter agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to the conflict of laws principles of such State. The parties hereby agree that this letter may only be amended or modified by a written instrument signed by you and a duly authorized representative of Kardigan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12. <u>Counterparts</u>**. This letter agreement may be executed in multiple counterparts, each of which shall be deemed an original agreement, but all of which, taken together, shall constitute one and the same agreement, binding on the parties. This letter agreement may be executed by a party's signature transmitted by facsimile or emailed pdf, and copies of this letter agreement and any such document or instrument executed and delivered by such means shall have the same force and effect as copies executed and delivered with original signatures.

*Remainder of Page Left Intentionally Blank* 

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| | |
|:---|:---|
|  Very truly yours, | Very truly yours, |
|  **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: | /s/ Minako Pazdera |
|  | Name: Minako Pazdera |
|  | Title: General Counsel |

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|:---|
|  **Acknowledged this 24th day of** |
|  **February, 2025:** |
| /s/ Tassos Gianakakos |
|  Name: Tassos Gianakakos |

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<u>BONUS INTEGRATION</u> 

<u>AGREEMENT</u> 

This BONUS INTEGRATION AGREEMENT (the "**Agreement**"), dated as of September 4, 2025, is entered into by and between Kardigan, Inc., a Delaware corporation (the "**Company**"), and Tassos Gianakakos (the "**Bonus Recipient**" and, together with the Company, the "**Parties**" and each, a "**Party**").

WHEREAS, pursuant to (i) that certain Agreement and Plan of Merger, dated as of February 24, 2025, by and among the Company, Pullover Merger Sub, Inc., Prolaio, Inc. ("**Prolaio**") and Shareholder Representative Services LLC and (ii) that certain bonus letter agreement, dated as of February 24, 2025, by and between the Company and the Bonus Recipient (the "**Bonus Agreement**"), following the successful completion of the Integration (as defined in the Bonus Agreement), on the Milestone Payment Date, the Bonus Recipient is entitled to receive the Bonus (as defined in the Bonus Agreement), consisting of the Base Bonus (as defined in the Bonus Agreement) and the Gross-Up Amount (as defined in the Bonus Agreement), payable in shares of Applicable Capital Stock.

WHEREAS, the Company is entering into a Series B Preferred Stock Purchase Agreement as of even date herewith (the "**Purchase Agreement**"), pursuant to which the Company will sell shares of its Series B Preferred Stock, par value $0.00001 per share (the "**Series B Preferred Stock**"), at a price per share equal to $21.365080.

WHEREAS, (i) the sale of Series B Preferred Stock pursuant to the Purchase Agreement qualifies as Kardigan's Next Preferred Stock Financing (and the Next Financing Transaction) and (ii) accordingly, the Applicable Capital Stock will be the Series B Preferred Stock.

WHEREAS, the Company and the Bonus Recipient desire to enter into this Agreement (i) to set forth all the payments, liabilities, obligations and duties of the Parties in connection with the Bonus Agreement and the issuance of the Series B Preferred Stock pursuant to the Purchase Agreement and (ii) to modify the Bonus Agreement such that (A) the Bonus Recipient will forfeit Series B Preferred Stock to satisfy the tax withholding obligations due in connection with the transactions contemplated by this Agreement, subject to and in accordance with the terms of this Agreement, (B) certain payments required to be made under the Bonus Agreement will be paid in cash to the Bonus Recipient for certain tax liabilities required to be satisfied directly by the Bonus Recipient and certain payments required to be made under the Bonus Agreement will be remitted to tax authorities via payroll for certain tax liabilities required to be satisfied by the Company through payroll and (C) no Loan will be issued to the Bonus Recipient.

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Series B Share Issuance and Tax Payments</u>. Notwithstanding anything to contrary set forth in the Bonus Agreement, the Bonus Recipient agrees that in full satisfaction of Company's obligation to satisfy the Bonus, that concurrently with the execution of this Agreement: (i) the Company shall issue to the Bonus Recipient that number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Gross Series B Preferred Shares" *less* the number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Withheld Shares" in satisfaction of the tax withholding and other tax obligations due in connection with the transactions contemplated by this Agreement (for an aggregate net issuance equal to that number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Net Shares Issued"); (ii) the Bonus Recipient shall deliver executed counterpart signature pages to (a) the Amended and Restated Investors' Rights

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Agreement, dated as of September 4, 2025 as an "Investor", (b) the Amended and Restated Voting Agreement, dated as of September 4, 2025 as an "Investor" and (c) the Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of September 4, 2025 as an "Investor" (collectively, the "**Stockholders Agreements**"), attached hereto as <u>Exhibit A</u>; and (iii) in connection with the Withheld Shares, the Company will pay the Bonus Recipient $136,103.76 in cash in satisfaction of certain tax liabilities required to be satisfied directly by the Bonus Recipient and the Company will remit $4,912,141.96 directly to federal and state tax authorities via payroll in satisfaction of certain tax liabilities required to be satisfied by the Company through payroll.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Representations and Warranties of the Company</u>. The Company represents and warrants to the Bonus Recipient as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) It is duly organized, validly existing, and in good standing under the laws of the state of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) It has all requisite power and authority to execute and deliver this Agreement, to perform its obligations hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The execution and delivery of this Agreement by the Company, the performance of its obligations hereunder, and the consummation by such entity of the transactions contemplated hereby have been duly and validly authorized by all necessary actions on the part of the Company, and no other proceedings on the part of such entity are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery by the Bonus Recipient, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and subject to the effect of general principles of equity (the "**Enforceability Limitations**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The shares of Series B Preferred Stock, when issued and delivered in accordance with the terms of and for the consideration set forth in this Agreement, will be validly issued, fully paid and non-assessable, and free and clear of any and all liens (other than liens imposed under securities laws, any organizational document of the Company, including the Stockholders Agreements and any other equityholders' agreement related to the Company to which the Bonus Recipient is a party). The shares of Series B Preferred Stock, when issued and delivered in accordance with the terms of and for the consideration set forth in this Agreement, will not be issued in violation of any provision of the organizational documents of the Company, including any rights of first refusal, preemptive rights, or any other similar rights of any party thereto contained therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Representations, Warranties and Covenants of the Bonus Recipient</u>. The Bonus Recipient represents and warrants to, and agrees with, the Company, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Bonus Recipient has the requisite legal entity power and authority to execute and deliver this Agreement and to perform his obligations hereunder and to consummate the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Agreement has been duly and validly executed and delivered by the Bonus Recipient. Assuming due authorization, execution and delivery of this Agreement by the other party hereto, this Agreement constitutes a legal, valid and binding obligation of the Bonus Recipient, enforceable against the Bonus Recipient in accordance with his terms, except as such enforceability may be limited by the Enforceability Limitations.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Bonus Recipient is acquiring the Series B Preferred Stock issued pursuant to this agreement for his own account for investment and not with a view to, or for offer or resale in connection with, a distribution of any such shares or any "beneficial interest" in such shares within the meaning of the Securities Act of 1933 (the "**Securities Act**"), and the rules and regulations thereunder, and the Bonus Recipient has no present intent, agreement or understanding to sell, pledge or otherwise dispose of any of such shares or any beneficial interest in any of such shares to any other individual or entity after the transactions contemplated hereby are consummated. The Bonus Recipient acknowledges that, upon their issuance, the shares of Series B Preferred Stock will not have been registered under the Securities Act or the securities laws of any state or other jurisdiction, and will not be transferable unless registered under the Securities Act, and any applicable state laws or an exemption from registration is then available. The Bonus Recipient is an accredited investor (as defined under Rule 501(a) of Regulation D under the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Bonus Recipient is a sophisticated investor, has knowledge and experience in financial and business matters and is capable (if applicable, with the assistance of his professional advisers) of independently evaluating the merits and risks of investing in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Release</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Parties agree that the issuance of the Series B Preferred Stock, the cash payments set forth in Section 1 and the transactions contemplated by this Agreement are in complete and full satisfaction of all obligations, liabilities and duties of the Parties with respect to the Bonus Agreement, and the Parties shall have no further obligations, liabilities or duties with respect to the Bonus Agreement, except as expressly set forth herein. For the avoidance of doubt, the Parties agree and acknowledge that notwithstanding Section 3 of the Bonus Agreement, the Company and the Bonus Recipient have agreed that the Bonus Recipient is not entitled to any Loan (as defined in the Bonus Agreement) under the Bonus Agreement. In the event of any conflict between this Agreement and the Bonus Agreement, this Agreement shall govern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In exchange for the execution of this Agreement, the receipt and sufficiency of which as good and valuable consideration are hereby acknowledged by all parties, the Bonus Recipient, for himself and for any and all of his successors in interest, successors, predecessors in interest, predecessors, affiliates, parents, family members, assigns or transferees and each of them, hereby knowingly, irrevocably and unconditionally forever release and discharge the Company and each of its past and present controlling persons, stockholders, successors, successors in interest, predecessors, predecessors in interest, assigns, affiliates, subsidiaries, and each of their respective past and present owners, partners, members, shareholders, principals, assigns or transferees, employees, agents, representatives, officers, directors, managers, attorneys and advisors from any and all claims, demands, rights, causes of action, lawsuits, debts, obligations, duties, and liabilities, arising out of, related to, concerning, or in connection with the Bonus Agreement, except for the obligations set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any notice, request, instruction or other document to be given hereunder by a Party shall be in writing and shall be deemed to have been given (x) when received if given in person or by courier or a courier service, or (y) on the date of transmission if sent by email if transmitted without indication of delivery failure prior to 5:00 p.m. local time for the recipient (and if transmitted without indication of delivery failure after 5:00 p.m. local time for the recipient, then delivery will be deemed duly given at 9:00 a.m. local time for the recipient on the subsequent business day):

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If to the Company, addressed as follows:

Kardigan, Inc.

131 Oyster Point Blvd, Second Floor

South San Francisco, CA 94080

Attention: General Counsel

Email: [\*\*\*]

with a copy (which shall not constitute notice) to:

Goodwin Procter LLP

100 Northern Avenue

Boston, MA 02210

Attention: [\*\*\*]

Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If to the Bonus Recipient, addressed to the applicable address set forth on the signature page hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If any provision (or portion thereof) of this Agreement shall be held invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions (or portions thereof) hereof shall not be affected thereby and such other provisions (or portions thereof) shall remain in full force and effect for so long as the economic or legal substance of the transactions contemplated hereby are not affected in any manner adverse to any Party. Upon such determination that any provision (or portion thereof) of this Agreement is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to amend, modify or supplement this Agreement so as to effect the original intent of the Parties hereto as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) This Agreement may be amended, modified or supplemented only in a writing signed by the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Unless otherwise specified in this Agreement, all references to currency, monetary values and dollars set forth herein shall mean United States dollars and all payments hereunder shall be made in United States dollars.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, including its statute of limitations, without giving effect to any laws, including any borrowing statute, that would result in the application of the laws of any jurisdiction other than the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) This Agreement may be executed and delivered (including by facsimile or email transmission of a portable document format (PDF) files) in one or more counterparts, and by the Parties in separate counterparts, each of which when executed shall be deemed an original, but all of which together shall constitute one and the same instrument.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first written above.

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| | |
|:---|:---|
| **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: | /s/ Tassos Gianakakos |
|  | Name: Tassos Gianakakos |
|  | Title: Chief Executive Officer |

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first written above.

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| |
|:---|
| **BONUS RECIPIENT:** |
| /s/ Tassos Gianakakos |
| **Tassos Gianakakos** |

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*[Signature page to Bonus Integration Agreement]* 

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<u>Schedule A</u> 

Bonus Recipient

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Bonus Recipient** | **Address** | **Gross Series<br>B Preferred<br>Shares** | **Gross Series<br>B Preferred<br>Shares** | **Withheld<br>Shares** | **Withheld<br>Shares** | **Net<br>Shares<br>Issued** | **Net<br>Shares<br>Issued** |
|  Tassos Gianakakos |  |  | 549378 |  | 236286 |  | 313092 |

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<u>Exhibit A</u> 

Signature Pages to Stockholders Agreements

[\*\*\*]

## Exhibit 10.10

**Exhibit 10.10** 

February 24, 2025

Jay Edelberg

Dear Jay,

As you may know, Kardigan, Inc., a Delaware corporation (the "<u>Kardigan</u>"), entered into an Agreement and Plan of Merger (the "<u>Merger Agreement</u>"), dated February 24, 2025, by and among the Company, Pullover Mergersub, Inc., a Delaware corporation ("<u>MergerSub</u>"), Prolaio, Inc., a Delaware corporation (the "<u>Company</u>"), and certain other parties pursuant to which the Company shall become a wholly owned subsidiary of Kardigan. Capitalized terms not defined herein shall have the meanings ascribed in the Merger Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1. <u>Capital Stock Bonus</u>**. Subject to and conditioned upon the Closing, upon the successful completion of the Integration (as defined below) (the date Kardigan's board of directors makes a determination that the Integration has been successfully completed, the "<u>Milestone Date</u>"), so long as you are providing services to Kardigan or its subsidiaries as an employee or consultant on both the Milestone Date and the Milestone Payment Date (as defined below), Kardigan will pay to you a bonus in the amount of $2,000,000 (the "<u>Base Bonus</u>") <u>plus</u> the Gross-Up Amount (as defined below) (together the "<u>Bonus</u>"), subject to and in accordance with the terms of this letter agreement. The Bonus shall be paid to you within sixty (60) days of the later of (i) the Milestone Date and (ii) the Next Financing Transaction (the latest to occur of the date in clause (i) or clause (ii) is referred to herein as the "<u>Milestone Payment Date</u>") in a number of shares of Applicable Capital Stock determined by dividing the Bonus by the Applicable Stock Price; provided, however, that the Milestone Payment Date must occur on or prior to the Expiration Date (as defined below). Notwithstanding the foregoing, in the event of a Deemed Liquidation Event (as defined in Kardigan's Certificate of Incorporation, as amended, restated or modified from time to time) prior to the Milestone Payment Date and prior to the Expiration Date, the Bonus shall be paid to you in cash within sixty (60) days of the consummation of such Deemed Liquidation Event, provided that you are providing services to Kardigan or its subsidiaries as an employee or consultant through the date of such Deemed Liquidation Event. For the avoidance of doubt, in the event that neither the Milestone Payment Date nor a Deemed Liquidation Event occurs on or prior to the Expiration Date, the Bonus shall be forfeited by you as of the Expiration Date without any payment of consideration thereof and you shall have no further rights or interests under this letter agreement.

Notwithstanding the foregoing, if your services are terminated without Cause (as defined below) or if you terminate your services for Good Reason (as defined below), in either case after the Milestone Date but prior to the Milestone Payment Date, you shall remain eligible to receive the Bonus upon the occurrence of the Next Financing Transaction (or, if earlier, a Deemed Liquidation Event) as described herein; provided, however, your right to receive the Bonus following any such termination shall be subject to your execution and non-revocation of a general release of claims in favor of Kardigan in a form acceptable to Kardigan (the "<u>Release</u>"), which Release shall become effective within sixty (60) days following the date of your termination.

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As used in this Section 1:

"<u>Alternative Financing Transaction</u>" means any equity financing transaction in which the stockholders of Kardigan receive securities in a company that is publicly listed on the Nasdaq Stock Market, the New York Stock Exchange or another marketplace or exchange approved by Kardigan's board of directors, including, without limitation, a reverse merger transaction or a deSPAC business combination with a concurrent PIPE.

"<u>Applicable Capital Stock</u>" means (i) Kardigan's Common Stock issued in Kardigan's IPO (if the Next Financing Transaction is Kardigan's IPO), (ii) the series of preferred stock issued by Kardigan to investors in Kardigan's Next Preferred Stock Financing (if the Next Financing Transaction is Kardigan's Next Preferred Stock Financing), or (iii) the publicly-listed securities that stockholders of Kardigan receive in an Alternative Financing Transaction (if the Next Financing Transaction is an Alternative Financing Transaction).

"<u>Applicable Stock Price</u>" means (i) the per share offering price to the public of Kardigan's Common Stock set forth on the cover of the final prospectus for Kardigan's IPO if the Next Financing Transaction is Kardigan's IPO, (ii) the lowest purchase price per share of Kardigan's Preferred Stock sold for cash in Kardigan's Next Preferred Stock Financing if the Next Financing Transaction is Kardigan's Next Preferred Stock Financing, or (iii) the fair market value per share of the publicly-listed securities that stockholders of Kardigan received in an Alternative Financing Transaction as of the closing date of such Alternative Financing Transaction if the Next Financing Transaction is an Alternative Financing Transaction.

"<u>Cause" means any of the following:</u>

your conduct constituting a material act of misconduct in connection with the performance of your duties, including, without limitation, (A) willful failure or refusal to perform material responsibilities that have been requested by Kardigan; (B) dishonesty to Kardigan with respect to any material matter; or (C) misappropriation of funds or property of Kardigan or any of its subsidiaries or affiliates other than the occasional, customary and *de minimis* use of Kardigan property for personal purposes;

your commission of certain acts satisfying the elements of (A) any felony or (B) a misdemeanor involving moral turpitude, deceit, dishonesty or fraud;

your misconduct, regardless of whether or not in the course of your services, that would reasonably be expected to result in material injury or reputational harm to Kardigan or any of its subsidiaries or affiliates if you were to continue to provide services in the same position;

continued non-performance of your duties hereunder (other than by reason of your physical or mental illness, incapacity or disability) which has continued for more than 10 business days following written notice of such non-performance from Kardigan;

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a material violation of any of Kardigan's written employment policies by you; or

your failure to cooperate with a bona fide internal investigation or an investigation by regulatory or law enforcement authorities, after being instructed by Kardigan to cooperate, or the willful destruction or failure to preserve documents or other materials known to be relevant to such investigation or the inducement of others to fail to cooperate or to produce documents or other materials in connection with such investigation.

"<u>Expiration Date</u>" means February 24, 2032.

"<u>Good Reason</u>" means that you have completed all steps of the Good Reason Process (as defined below) following the occurrence of any of the following events without your consent (each, a "<u>Good Reason Condition</u>")

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a material diminution in your responsibilities, authority or duties;

a material diminution in your base salary except for across-the-board salary reductions based on Kardigan's financial performance similarly affecting all or substantially all senior management employees of Kardigan; or

the requirement that you report other than to Kardigan's chief executive officer.

"<u>Good Reason Process</u>" consists of the following steps:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) you reasonably determine in good faith that a Good Reason Condition has occurred;

you notify Kardigan in writing of the first occurrence of the Good Reason Condition within 60 days of the first occurrence of such condition;

you cooperate in good faith with Kardigan's efforts, for a period of not less than 30 days following such notice (the "<u>Cure Period</u>"), to remedy the Good Reason Condition;

notwithstanding such efforts, the Good Reason Condition continues to exist at the end of the Cure Period; and

you terminate your services within 60 days after the end of the Cure Period.

If Kardigan cures the Good Reason Condition during the Cure Period, Good Reason shall be deemed not to have occurred.

"<u>Integration</u>" means the assumption by Kardigan of the Company's general and administrative functions, consisting of the Company's finance and accounting systems,

HR and payroll systems, and IT systems, as determined in good faith by Kardigan's board of directors.

"<u>Kardigan's Next Preferred Stock Financing</u>" means a bona fide transaction or series of transactions following the Closing with the principal purpose of raising capital, pursuant to which Kardigan issues and sells a newly authorized series of preferred stock ("<u>Kardigan's Preferred Stock</u>") at a fixed valuation. For the avoidance of doubt, any sale of Kardigan's Series A Preferred Stock shall not be deemed Kardigan's Next Preferred Stock Financing.

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"<u>Kardigan's IPO</u>" means the closing of Kardigan's first sale of its Common Stock to the public in a firm commitment underwritten initial public offering pursuant to a registration statement on Form S-1 or Form SB-2 under the Securities Act of 1933, as amended.

"<u>Next Financing Transaction</u>" means the earlier to occur of (i) Kardigan's Next Preferred Stock Financing, (ii) Kardigan's IPO or (iii) any Alternative Financing Transaction.

In the event that after the Next Financing Transaction or a Deemed Liquidation Event and prior to the issuance of the Applicable Capital Stock there is (i) a subdivision, split, dividend payable in shares, reverse-split, or similar adjustment applicable to the Applicable Capital Stock or (ii) the Applicable Capital Stock is exchanged, reclassified, converted or subject to similar adjustment, appropriate adjustment shall be made to the Applicable Capital Stock and Applicable Stock Price for purposes of this letter agreement so that you will receive property, securities or other rights with a fair market value equivalent to the Applicable Capital Stock that you would have received at the Applicable Stock prior to any such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2. <u>Gross Up</u>**. In addition to the $2,000,000 Base Bonus set forth above, Kardigan shall make an additional bonus payment (the "<u>Gross-Up Payment</u>" and the amount of such Gross-Up Payment, the "<u>Gross-Up Amount</u>" payable as described above) to you to cover a portion of all applicable federal, state and local income and employment taxes applicable to your Bonus such that the net amount received by you after all such income and employment taxes are paid (including, without limitation, any and all income and employment taxes withheld and paid over to the applicable taxing authority on your behalf and taking into account any incremental income and employment taxes imposed on such Gross-Up Payment) is equal to the net amount you would have received if the Base Bonus were instead subject to tax at applicable long-term capital gain rates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3. <u>Loan</u>**. In the event that the shares of Applicable Capital Stock issued to you are issued on the Next Financing Transaction are not Freely Tradeable Shares, subject to compliance with applicable law (including the Sarbanes-Oxley Act of 2002, as amended ("<u>SOX</u>")), Kardigan shall loan to you an amount necessary to cover all applicable federal, state and local taxes applicable to your Bonus (the "<u>Loan</u>"). The Loan shall bear interest at the applicable federal rates published by the Internal Revenue Service, and shall mature and all amounts owed under the Loan shall be due and payable upon the earliest to occur of (i) the tenth anniversary of the Loan, (ii) a Deemed Liquidation Event and (iii) immediately before any event or transaction, as a result of which, the lending relationship evidenced thereby would be prohibited by applicable law, including, without limitation, under Section 13(k) of the Securities Act of 1934, as amended. In addition, any proceeds from the sales of any Applicable Capital Stock (or any securities or other property into which the Applicable Capital Stock may be exchanged, reclassified or converted) held by you or any distributions thereon shall be used to repay the principal and accrued interest under the Loan (with each such payment applied first to any accrued interest and second to any outstanding principal). The Loan shall be evidenced by a customary note agreement (and applicable pledge or security documents), with a minimum of 50% personal recourse, prepared by

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Kardigan in good faith. The Applicable Capital Stock shall be pledged by you as security for your obligations under the Loan, including without limitation the timely payment of the principal and interest under the Loan, and all certificates or instruments representing or evidencing the Applicable Capital Stock shall be delivered to and held by Kardigan and shall be accompanied by duly executed instruments of transfer or assignment in blank, all in form and substance satisfactory to Kardigan. For the avoidance of doubt, if a Deemed Liquidation Event is the payment event for the Bonus, no Loan will be issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4. <u>Tax Determination</u>**. For purposes of calculating your income taxes for the Gross- Up Payment and the amount of the Loan, Kardigan shall apply the highest applicable marginal tax rates and long-term capital gains rate (as applicable) in each applicable jurisdiction that apply to you. All determinations required to be made with respect to the Gross-Up Payment and the Loan, including the Gross-Up Amount, the amount of the Loan and applicable tax rates, shall be made by the board of directors of Kardigan in good faith and reasonable discretion after consultation with you. Any good faith determination by the board of directors of Kardigan with respect to any such matters shall be binding upon Kardigan and you. The Bonus and Gross-Up Payment, if any, shall be subject to your satisfaction of any applicable withholding taxes on your behalf and subject to Kardigan's normal payroll processes and procedures, which may be subtracted from the Bonus and Gross-Up Payment to the extent (A) the Loan is prohibited under applicable law (including by Kardigan withholding shares of the Applicable Capital Stock otherwise payable to you with a fair market value on the date of issuance equal to the applicable tax withholding obligation) and (B) you elect not to advance cash for the applicable withholding taxes to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5. <u>Section 409A</u>**. The provisions regarding all payments to be made hereunder shall be administered such that all payments shall be exempt from or comply with Section 409A of the Internal Revenue Code and the regulations and guidance promulgated under the Internal Revenue Code ("<u>Section</u> <u>409A</u>"). To the extent that any payment to be made under this letter agreement is subject to Section 409A and any provision of this letter agreement is ambiguous as to its compliance with Section 409A, the provision shall be read in such a manner so that all payments hereunder comply with Section 409A. For purposes of Section 409A, your right to receive any installment payments pursuant to this letter agreement shall be treated as a right to receive a series of separate and distinct payments. Whenever a payment under this letter agreement specifies a payment period with reference to a number of days, the actual date of payment within the specified period shall be within the sole discretion of the Company. The parties agree that this letter agreement may be amended, as reasonably requested by either party, and as may be necessary to fully comply with Section 409A and all related rules and regulations in order to preserve the payments and benefits provided hereunder without additional cost to either party. Notwithstanding the foregoing, Kardigan makes no representations that the payments and benefits provided pursuant to this letter agreement comply with or are exempt from Section 409A and in no event shall Kardigan be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by you on account of non-compliance with Section 409A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6. <u>Employment At-Will Status</u>**. Nothing in this letter agreement alters the at-will status of your employment with Kardigan or its subsidiaries and Kardigan and its subsidiaries may terminate your employment or service at any time.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7. <u>Confidentiality</u>**. You agree that you will not disclose to any person or third party, other than on a confidential basis to your immediate family and your legal and/or financial advisors, the fact that Kardigan has entered into this letter agreement with you or the terms and conditions of this letter agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8. <u>Successors and Assigns</u>**. This letter agreement shall be binding upon and shall insure to the benefit of the successors, assigns, personal representatives, heirs and legatees of the respective parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9. <u>Unfunded Obligation</u>**. Nothing in this letter agreement shall require Kardigan or its subsidiaries, for purposes of satisfying any obligations under this letter agreement, to purchase assets or place any assets in a trust or other entity to which contributions are made or otherwise to segregate any assets, nor shall Kardigan or any of its subsidiaries maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately maintained or administered fund for such purposes. Prior to the payment to you of the Bonus, you shall have no rights under this letter agreement other than as an unsecured general creditor of Kardigan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10. <u>Integration</u>**. This letter agreement constitutes the entire agreement between Kardigan and you with respect to the subject matter hereof and supersedes all prior agreements and discussions between such parties concerning such subject matter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11. <u>Miscellaneous</u>**. This letter agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without giving effect to the conflict of laws principles of such State. The parties hereby agree that this letter may only be amended or modified by a written instrument signed by you and a duly authorized representative of Kardigan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12. <u>Counterparts</u>**. This letter agreement may be executed in multiple counterparts, each of which shall be deemed an original agreement, but all of which, taken together, shall constitute one and the same agreement, binding on the parties. This letter agreement may be executed by a party's signature transmitted by facsimile or emailed pdf, and copies of this letter agreement and any such document or instrument executed and delivered by such means shall have the same force and effect as copies executed and delivered with original signatures.

*Remainder of Page Left Intentionally Blank* 

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| | |
|:---|:---|
| Very truly yours, | Very truly yours, |
| **KARDIGAN, INC.** | **KARDIGAN, INC.** |
| By: | /s/ Tassos Gianakakos |
|  | Name: Tassos Gianakakos |
|  | Title: Chief Executive Officer |

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| |
|:---|
| **Acknowledged this 24th day of** |
| **February, 2025:** |
| /s/ Jay Edelberg |
| Name: Jay Edelberg |

---

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<u>BONUS INTEGRATION AGREEMENT</u> 

This BONUS INTEGRATION AGREEMENT (the "**Agreement**"), dated as of September 4, 2025, is entered into by and between Kardigan, Inc., a Delaware corporation (the "**Company**"), and Jay Edelberg (the "**Bonus Recipient**" and, together with the Company, the "**Parties**" and each, a "**Party**").

WHEREAS, pursuant to (i) that certain Agreement and Plan of Merger, dated as of February 24, 2025, by and among the Company, Pullover Merger Sub, Inc., Prolaio, Inc. ("**Prolaio**") and Shareholder Representative Services LLC and (ii) that certain bonus letter agreement, dated as of February 24, 2025, by and between the Company and the Bonus Recipient (the "**Bonus Agreement**"), following the successful completion of the Integration (as defined in the Bonus Agreement), on the Milestone Payment Date, the Bonus Recipient is entitled to receive the Bonus (as defined in the Bonus Agreement), consisting of the Base Bonus (as defined in the Bonus Agreement) and the Gross-Up Amount (as defined in the Bonus Agreement), payable in shares of Applicable Capital Stock.

WHEREAS, the Company is entering into a Series B Preferred Stock Purchase Agreement as of even date herewith (the "**Purchase Agreement**"), pursuant to which the Company will sell shares of its Series B Preferred Stock, par value $0.00001 per share (the "**Series B Preferred Stock**"), at a price per share equal to $21.365080.

WHEREAS, (i) the sale of Series B Preferred Stock pursuant to the Purchase Agreement qualifies as Kardigan's Next Preferred Stock Financing (and the Next Financing Transaction) and (ii) accordingly, the Applicable Capital Stock will be the Series B Preferred Stock.

WHEREAS, the Company and the Bonus Recipient desire to enter into this Agreement (i) to set forth all the payments, liabilities, obligations and duties of the Parties in connection with the Bonus Agreement and the issuance of the Series B Preferred Stock pursuant to the Purchase Agreement and (ii) to modify the Bonus Agreement such that (A) the Bonus Recipient will forfeit Series B Preferred Stock to satisfy the tax withholding obligations due in connection with the transactions contemplated by this Agreement, subject to and in accordance with the terms of this Agreement and (B) no Loan will be issued to the Bonus Recipient.

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Series B Share Issuance and Tax Payments</u>. Notwithstanding anything to contrary set forth in the Bonus Agreement, the Bonus Recipient agrees that in full satisfaction of Company's obligation to satisfy the Bonus, that concurrently with the execution of this Agreement: (i) the Company shall issue to the Bonus Recipient that number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Gross Series B Preferred Shares" *less* the number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Withheld Shares" in satisfaction of the tax withholding and other tax obligations due in connection with the transactions contemplated by this Agreement (for an aggregate net issuance equal to that number of shares of Series B Preferred Stock as is set forth opposite the Bonus Recipient's name on <u>Schedule A</u> hereto under the heading "Net Shares Issued"); (ii) the Bonus Recipient shall deliver executed counterpart signature pages to (a) the Amended and Restated Investors' Rights Agreement, dated as of September 4, 2025 as an "Investor", (b) the Amended and Restated Voting Agreement, dated as of September 4, 2025 as an "Investor" and (c) the Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of September 4, 2025 as an "Investor" (collectively, the

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"**Stockholders Agreements**"), attached hereto as <u>Exhibit A</u>; and (iii) in connection with the Withheld Shares, the Company will remit $1,314,246.49 directly to federal and state tax authorities via payroll in satisfaction of certain tax liabilities required to be satisfied by the Company through payroll.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Representations and Warranties of the Company</u>. The Company represents and warrants to the Bonus Recipient as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) It is duly organized, validly existing, and in good standing under the laws of the state of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) It has all requisite power and authority to execute and deliver this Agreement, to perform its obligations hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The execution and delivery of this Agreement by the Company, the performance of its obligations hereunder, and the consummation by such entity of the transactions contemplated hereby have been duly and validly authorized by all necessary actions on the part of the Company, and no other proceedings on the part of such entity are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery by the Bonus Recipient, constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and subject to the effect of general principles of equity (the "**Enforceability Limitations**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The shares of Series B Preferred Stock, when issued and delivered in accordance with the terms of and for the consideration set forth in this Agreement, will be validly issued, fully paid and non-assessable, and free and clear of any and all liens (other than liens imposed under securities laws, any organizational document of the Company, including the Stockholders Agreements and any other equityholders' agreement related to the Company to which the Bonus Recipient is a party). The shares of Series B Preferred Stock, when issued and delivered in accordance with the terms of and for the consideration set forth in this Agreement, will not be issued in violation of any provision of the organizational documents of the Company, including any rights of first refusal, preemptive rights, or any other similar rights of any party thereto contained therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Representations, Warranties and Covenants of the Bonus Recipient</u>. The Bonus Recipient represents and warrants to, and agrees with, the Company, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Bonus Recipient has the requisite legal entity power and authority to execute and deliver this Agreement and to perform his obligations hereunder and to consummate the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Agreement has been duly and validly executed and delivered by the Bonus Recipient. Assuming due authorization, execution and delivery of this Agreement by the other party hereto, this Agreement constitutes a legal, valid and binding obligation of the Bonus Recipient, enforceable against the Bonus Recipient in accordance with his terms, except as such enforceability may be limited by the Enforceability Limitations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Bonus Recipient is acquiring the Series B Preferred Stock issued pursuant to this agreement for his own account for investment and not with a view to, or for offer or resale in connection with, a distribution of any such shares or any "beneficial interest" in such shares within the meaning of the Securities Act of 1933 (the "**Securities Act**"), and the rules and regulations thereunder,

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and the Bonus Recipient has no present intent, agreement or understanding to sell, pledge or otherwise dispose of any of such shares or any beneficial interest in any of such shares to any other individual or entity after the transactions contemplated hereby are consummated. The Bonus Recipient acknowledges that, upon their issuance, the shares of Series B Preferred Stock will not have been registered under the Securities Act or the securities laws of any state or other jurisdiction, and will not be transferable unless registered under the Securities Act, and any applicable state laws or an exemption from registration is then available. The Bonus Recipient is an accredited investor (as defined under Rule 501(a) of Regulation D under the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Bonus Recipient is a sophisticated investor, has knowledge and experience in financial and business matters and is capable (if applicable, with the assistance of his professional advisers) of independently evaluating the merits and risks of investing in the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Release</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Parties agree that the issuance of the Series B Preferred Stock[, the cash payments set forth in Section 1] and the transactions contemplated by this Agreement are in complete and full satisfaction of all obligations, liabilities and duties of the Parties with respect to the Bonus Agreement, and the Parties shall have no further obligations, liabilities or duties with respect to the Bonus Agreement, except as expressly set forth herein. For the avoidance of doubt, the Parties agree and acknowledge that notwithstanding Section 3 of the Bonus Agreement, the Company and the Bonus Recipient have agreed that the Bonus Recipient is not entitled to any Loan (as defined in the Bonus Agreement) under the Bonus Agreement. In the event of any conflict between this Agreement and the Bonus Agreement, this Agreement shall govern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In exchange for the execution of this Agreement, the receipt and sufficiency of which as good and valuable consideration are hereby acknowledged by all parties, the Bonus Recipient, for himself and for any and all of his successors in interest, successors, predecessors in interest, predecessors, affiliates, parents, family members, assigns or transferees and each of them, hereby knowingly, irrevocably and unconditionally forever release and discharge the Company and each of its past and present controlling persons, stockholders, successors, successors in interest, predecessors, predecessors in interest, assigns, affiliates, subsidiaries, and each of their respective past and present owners, partners, members, shareholders, principals, assigns or transferees, employees, agents, representatives, officers, directors, managers, attorneys and advisors from any and all claims, demands, rights, causes of action, lawsuits, debts, obligations, duties, and liabilities, arising out of, related to, concerning, or in connection with the Bonus Agreement, except for the obligations set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any notice, request, instruction or other document to be given hereunder by a Party shall be in writing and shall be deemed to have been given (x) when received if given in person or by courier or a courier service, or (y) on the date of transmission if sent by email if transmitted without indication of delivery failure prior to 5:00 p.m. local time for the recipient (and if transmitted without indication of delivery failure after 5:00 p.m. local time for the recipient, then delivery will be deemed duly given at 9:00 a.m. local time for the recipient on the subsequent business day):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If to the Company, addressed as follows:

Kardigan, Inc.

131 Oyster Point Blvd, Second Floor

South San Francisco, CA 94080

Attention: General Counsel

Email: [\*\*\*]

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with a copy (which shall not constitute notice) to:

Goodwin Procter LLP

100 Northern Avenue

Boston, MA 02210

Attention: [\*\*\*]

Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) If to the Bonus Recipient, addressed to the applicable address set forth on the signature page hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If any provision (or portion thereof) of this Agreement shall be held invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions (or portions thereof) hereof shall not be affected thereby and such other provisions (or portions thereof) shall remain in full force and effect for so long as the economic or legal substance of the transactions contemplated hereby are not affected in any manner adverse to any Party. Upon such determination that any provision (or portion thereof) of this Agreement is invalid, illegal or unenforceable, the Parties shall negotiate in good faith to amend, modify or supplement this Agreement so as to effect the original intent of the Parties hereto as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) This Agreement may be amended, modified or supplemented only in a writing signed by the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Unless otherwise specified in this Agreement, all references to currency, monetary values and dollars set forth herein shall mean United States dollars and all payments hereunder shall be made in United States dollars.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, including its statute of limitations, without giving effect to any laws, including any borrowing statute, that would result in the application of the laws of any jurisdiction other than the State of Delaware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) This Agreement may be executed and delivered (including by facsimile or email transmission of a portable document format (PDF) files) in one or more counterparts, and by the Parties in separate counterparts, each of which when executed shall be deemed an original, but all of which together shall constitute one and the same instrument.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first written above.

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| | |
|:---|:---|
|  **KARDIGAN, INC.** | **KARDIGAN, INC.** |
|  By: | /s/ Tassos Gianakakos |
|  Name: | Tassos Gianakakos |
|  Title: | Chief Executive Officer |

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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first written above.

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| |
|:---|
| **BONUS RECIPIENT:** |
|  /s/ Jay Edelberg |
| **Jay Edelberg** |

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*[Signature page to Bonus Integration Agreement]* 

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<u>Schedule A</u> 

Bonus Recipient

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Bonus Recipient** | **Address** | **Gross Series B<br>Preferred Shares** | **Gross Series B<br>Preferred Shares** | **Withheld Shares** | **Withheld Shares** | **Net<br>Shares<br>Issued** | **Net<br>Shares<br>Issued** |
|  Jay Edelberg |  |  | 122782 |  | 61514 |  | 61268 |

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<u>Exhibit A</u> 

Signature Pages to Stockholders Agreements

[\*\*\*]

## Exhibit 10.18

**Exhibit 10.18** 

**<u>THE COVE</u>**

**<u>LEASE</u>**

This Lease (the "**Lease**"), dated as of the Effective Date set forth in <u>Section</u> <u>1</u> of the Summary of Basic Lease Information below (the "**Summary**"), is made by and between **HCP OYSTER POINT III, LLC**, a Delaware limited liability company ("**Landlord**"), and **ENCARDA, INC., a Delaware corporation** ("**Tenant**"). The Tenant originally named in the foregoing sentence may be referred to in this Lease as the "**Original Tenant**."

**<u>SUMMARY OF BASIC LEASE INFORMATION</u>**

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| | |
|:---|:---|
| TERMS OF LEASE | DESCRIPTION |
| 1. Effective Date: | September 17, 2024 |
| 2. Building; Premises; Project (<u>Article 1</u>). |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 Building: | That certain Building containing approximately 175,830 rentable square feet of space ("**RSF**") located at 131 Oyster Point Boulevard, South San Francisco, California 94080. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 Premises: | Approximately 35,943 rentable square feet of space located on the second (2<sup>nd</sup>) floor of the Building and commonly known as #2, as further set forth in **<u>Exhibit A</u>** to the Lease. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 Project: | The office / laboratory development, commonly referred to as "The Cove", and consisting of the Building, the Common Areas, other buildings and land upon which such development is located, and any other building(s) and land from time to time designated by Landlord. |
| 3. Lease Term (<u>Article 2</u>). |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 Lease Term: | Sixty-six (66) full calendar months. |

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| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 Lease Commencement Date: | The earlier to occur of (i) the date upon which Tenant first commences to conduct business in the Premises and (ii) the date that is fifteen (15) days after the Delivery Date (as that term is defined in <u>Section 1.1.1</u> of this Lease). The Delivery Date is currently anticipated to be August 30, 2024 (the "**Anticipated Delivery Date**"). Tenant shall have certain early entry rights during that certain 15-day period between the Delivery Date and the Lease Commencement Date pursuant to <u>Section 2.4</u> of the Lease. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 Lease Expiration Date: | The last day of the sixty-sixth (66<sup>th</sup>) full calendar month following the Lease Commencement Date. |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 Option Term(s): | Tenant has one (1) option (the "**Extension Option**") to extend the Lease Term for a period of five (5)-years (the "**Option Term**"), as more particularly set forth in <u>Section 2.2</u> of this Lease. |

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4. Base Rent (<u>Article 3</u>):

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| | | | |
|:---|:---|:---|:---|
| Months of Lease Term | Annual<br> Base Rent | Monthly<br> Installment<br> of Base Rent | Approximate<br> Monthly Base<br> Rent per Rentable<br> Square Foot\* |
| 1 – 12\* | $2480067.00 | $206672.25 | $5.75 |
| 13 – 24 | $2566869.35 | $213905.78 | $5.95 |
| 25 – 36 | $2656709.77 | $221392.48 | $6.16 |
| 37 – 48 | $2749694.61 | $229141.22 | $6.38 |
| 49 – 60 | $2845933.93 | $237161.16 | $6.60 |
| 61 – 66 | $2945541.61 | $245461.80 | $6.83 |

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\* The amounts identified in the column entitled "Approximate Monthly Base Rent per Rentable Square Foot" are rounded amounts and are provided for informational purposes only. The amounts identified in the columns entitled "Annual Base Rent" and "Monthly Installment of Base Rent" shall control. 

\*\* Subject to and in accordance with the terms set forth in <u>Section</u> <u>3.2</u> of this Lease, Tenant shall have no obligation to pay the Base Rent with respect to the Premises which is attributable to the first ten (10) full calendar months of the Lease Term; provided, however, Tenant shall be required to pay Tenant's Share of Direct Expenses attributable to such period, as well as for all utilities and other services. 

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| | |
|:---|:---|
| 5. Special Allowance (**<u>Exhibit B</u>**): | Up to, but not exceeding $718,860.00 (<u>i.e.,</u> $20.00 per rentable square foot of the Premises), subject to the terms of the Tenant Work Letter attached hereto as **<u>Exhibit B</u>**. |
| 6. Tenant's Share (<u>Article 4</u>): | 20.44% |
| 7. Permitted Use (<u>Article 5</u>): | The Premises shall be used only for general office, research and development, vivarium, engineering, laboratory, storage and/or warehouse uses, including, but not limited to, administrative offices and other lawful uses reasonably related to or incidental to such specified uses, all (i) consistent with first class life sciences projects in South San Francisco, California ("**First Class Life Sciences Projects**"), and (ii) in compliance with, and subject to, Applicable Laws (as that term is defined in <u>Article 24</u>) and the terms of this Lease. |
| 8. Letter of Credit (<u>Letter of Credit Rider</u>): | $413,344.50. |
| 9. Parking (<u>Article 28</u>): | Ninety-one (91) unreserved parking spaces (<u>i.e.,</u> two point five (2.5) unreserved parking spaces for every 1,000 rentable square feet of the Premises). |

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| | |
|:---|:---|
| 10. Address of Tenant (<u>Section 29.18</u>): | EnCarda, Inc.<br> 515 Quietwood Dr.<br> San Rafael, CA 94903<br> Attention: Oliver Sjahsam<br> (Prior to Lease Commencement Date)<br>and<br>EnCarda, Inc.<br> 131 Oyster Point Boulevard, #2<br> South San Francisco, California 94080<br> Attention: Oliver Sjahsam<br> (After Lease Commencement Date) |
| 11. Address of Landlord (<u>Section 29.18</u>): | See <u>Section 29.18</u> of the Lease. |
| 12. Broker(s) (<u>Section 29.24</u>): | Representing Landlord and Tenant: CBRE, Inc. |
| 14. Amount Due Upon Lease Execution: | $206,672.25, as first month's Base Rent<br>$94,673.55, as first month's estimated Direct Expenses<br>$301,345.80 Total |

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**1. PREMISES, BUILDING, PROJECT, AND COMMON AREAS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 **<u>Premises, Building, Project and Common Areas</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1 **<u>The Premises; Tender of Possession; Late Delivery/Completion Remedies; Initial Good Working Order and Compliance; Building Systems Warranty</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.1 **<u>Premises</u>**. Landlord hereby leases to Tenant and Tenant hereby leases from Landlord the premises set forth in <u>Section</u> <u>2.2</u> of the Summary (the "**Premises**"). The outline of the Premises is set forth in **<u>Exhibit A</u>** attached hereto. The outline of the "Building" and the "Project," as those terms are defined in <u>Section</u> <u>1.1.2</u> below, are further depicted on the site plan attached hereto as **<u>Exhibit A-1</u>** (the "**Site Plan**"). The parties hereto agree that the lease of the Premises is upon and subject to the terms, covenants and conditions herein set forth, and Tenant covenants to keep and perform each and all of such terms, covenants and conditions by it to be kept and performed. The parties hereto hereby acknowledge that the purpose of **<u>Exhibit A</u>** is to show the approximate location of the Premises only, and such Exhibit is not meant to constitute an agreement, representation or warranty as to the construction of the Premises, the precise area thereof or the specific location of the "Common Areas," as that term is defined in <u>Section</u> <u>1.1.3</u>, below, or the elements thereof or of the accessways to the Premises or the "Project," as that term is defined in <u>Section</u> <u>1.1.2</u>, below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.2 **<u>Tender of Possession</u>**. Except as specifically set forth in this Lease and in the Tenant Work Letter attached hereto as **<u>Exhibit B</u>** (the "**Tenant Work Letter**"), Landlord shall tender possession of the Premises to Tenant in its existing, broom clean and otherwise "as is" condition, free of occupancy rights of others, and Landlord shall not be obligated to provide or pay for any improvement work or services related to the improvement of the Premises. Landlord shall be deemed to have tendered possession of the Premises to Tenant upon the date (the "**Delivery Date**") that Landlord delivers the Premises to Tenant with Landlord's Delivery Work Substantially Completed (as those terms are defined in the Tenant Work Letter), and no action by Tenant shall be required therefor. If Landlord does not deliver possession of the Premises to Tenant with Landlord's Delivery Work Substantially Completed on or before the Anticipated Delivery Date set forth in <u>Section</u> <u>3.2</u> of the Summary as the Anticipated Delivery Date (or any other particular date) in the condition required by the Tenant Work Letter, then, except as expressly set forth in Section 1.1.1.3 below, Landlord shall not be subject to any liability nor shall the validity of this Lease nor the obligations of Tenant hereunder be affected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.3 **<u>Late Delivery/Completion Remedies</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) **<u>For Landlord's Delivery Work</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Abatement Remedy</u>. Notwithstanding <u>Section</u> <u>1.1.1.2</u> above to the contrary, if Landlord fails to cause the Delivery Date to occur on or before the date that is sixty (60) days after the Anticipated Delivery Date (the "**First Outside Delivery Date**"), which First Outside Delivery Date shall be extended day for day for each day Landlord fails to cause the Delivery Date to occur as a direct result of any Tenant Delivery Work Delays (as defined in the Tenant Work Letter), and/or any events of Force Majeure (as defined below), then Landlord shall abate

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one (1) day of Base Rent for every one (1) day of delay that Landlord fails to cause the Delivery Date to occur beyond the First Outside Delivery Date (as so extended). Except as expressly provided in <u>Section</u> <u>1.1.1.3(a)(ii)</u> below, the abatement right afforded to Tenant under this <u>Section</u> <u>1.1.1.3(a)(i)</u> shall be Tenant's sole and exclusive remedy for Landlord's failure to cause the Delivery Date to occur by the First Outside Delivery Date (as so extended).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Termination Remedy</u>. Notwithstanding <u>Section</u> <u>1.1.1.2</u> above to the contrary, if Landlord fails to cause the Delivery Date to occur on or before the date that is one hundred twenty (120) days after the Anticipated Delivery Date (the "**Second Outside Delivery Date**"), which Second Outside Delivery Date shall be extended day for day for each day Landlord fails to cause the Delivery Date to occur as a direct result of any Tenant Delivery Work Delays, and/or any events of Force Majeure, then Tenant, as its sole and exclusive remedy for such failure (without limiting Tenant's abatement rights set forth in <u>Section</u> <u>1.1.1.3(a)(i)</u> above), may, at Tenant's election, terminate this Lease effective upon the date that is twenty (20) days after written notice of termination (the "**Delivery Work Termination Notice**") is delivered by Tenant to Landlord, so long as the Delivery Work Termination Notice is delivered by Tenant to Landlord on or before the date that is the earlier of (A) ten (10) days after the Second Outside Delivery Date (as may be so extended) and (B) the date that Landlord causes the Delivery Date to occur; provided, however, the Delivery Work Termination Notice shall be nullified if Landlord causes the Delivery Date to occur within such ten (10) day period, in which event this Lease shall continue in full force and effect. If this Lease is terminated pursuant to the foregoing provisions of this <u>Section</u> <u>1.1.1.3(a)(ii)</u>, then the parties shall be discharged from all obligations accruing under this Lease after the effective date of such termination and Landlord shall return the L-C to Tenant on or before the date that is thirty (30) days after such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>For Tenant Improvements</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Abatement Remedy</u>. Notwithstanding Section 1.1.1.2 above to the contrary, if Landlord fails to cause Substantial Completion of the Tenant Improvements to occur on or before the date that is ninety (90) days after the Anticipated TI Completion Date (as defined in the Tenant Work Letter attached hereto) (the "**First Outside Completion Date**"), which First Outside Completion Date shall be extended day for day for each day Landlord fails to cause Substantial Completion of the Tenant Improvements to occur as a direct result of any Tenant TI Delays, and/or any events of Force Majeure, then Landlord shall abate one (1) day of Base Rent for every one (1) day of delay that Landlord fails to cause Substantial Completion of the Tenant Improvements to occur beyond the First Outside Completion Date (as so extended). Except as expressly provided in <u>Section</u> <u>1.1.1.3(b)(ii)</u> below, the abatement right afforded to Tenant under this <u>Section</u> <u>1.1.1.3(b)(i)</u> shall be Tenant's sole and exclusive remedy for Landlord's failure to cause Substantial Completion of the Tenant Improvements to occur by the First Outside Completion Date (as so extended).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Termination Remedy</u>. Notwithstanding <u>Section</u> <u>1.1.1.2</u> above to the contrary, if Landlord fails to cause Substantial Completion of the Tenant Improvements to occur on or before the date that is one hundred eighty (180) days after the Anticipated TI Completion Date (the "**Second Outside Completion Date**"), which Second Outside Completion Date shall be extended day for day for each day Landlord fails to cause Substantial Completion of the Tenant Improvements to occur as a direct result of any Tenant TI Delays, and/or any events of Force Majeure, then Tenant, as its sole and exclusive remedy for such failure (without limiting Tenant abatement rights set forth in <u>Section</u> <u>1.1.1.3(b)(i)</u> above), may, at Tenant's election, terminate this Lease effective upon the date that is twenty (20) days after written notice of termination (the "**TI Termination Notice**") is delivered by Tenant to Landlord, so long as the TI Termination Notice is delivered by Tenant to Landlord on or before the date that is the earlier of (A) ten (10) days after the Second Outside Completion Date (as may be so extended) and (B) the date that Landlord causes Substantial Completion of the Tenant Improvements to occur; provided, however, the TI Termination Notice shall be nullified if Landlord causes Substantial Completion of the Tenant Improvements to occur within such ten (10) day period, in which event this Lease shall continue in full force and effect. If this Lease is terminated pursuant to the foregoing provisions of this <u>Section</u> <u>1.1.1.3(b)(ii)</u>, then the parties shall be discharged from all obligations accruing under this Lease after the effective date of such termination and Landlord shall return the L-C to Tenant on or before the date that is thirty (30) days after such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.4 **<u>Initial Good Working Order and Compliance</u>**. Neither Landlord nor any agent of Landlord has made any representation or warranty regarding the condition of the Premises, the Building or the Project or with respect to the suitability of any of the foregoing for the conduct of Tenant's business, except as specifically set forth in this Lease and the Tenant Work Letter. Notwithstanding anything in this Lease to the contrary, if (i) as of the Delivery Date, (A) the components of the Base Building (as defined in <u>Section</u> <u>7.2</u> below) which serve the Premises, and/or the Common Areas of the Building and/or Project that serve the Premises are not in compliance with the ADA (<u>i.e.</u>, Title III of the Americans with Disabilities Act of 1990 and the regulations and rules promulgated thereunder, as all of the same may be amended and supplemented from time to time) or other applicable laws in effect as of such date (as such non-compliance shall be determined on an unoccupied basis without regard to Tenant's proposed use of the Premises or any alterations or improvements [except for the initial Tenant Improvements set forth on the Approved Space Plan, as defined in the Tenant Work Letter] to be completed by or for Tenant in the Premises), and/or (B) the Base Building components which serve the Premises are not in good order, condition and repair, and (ii) Tenant becomes aware thereof and delivers to Landlord written notice (the "**Non-Compliance Notice**") of such non-compliance described in clause (A) hereinabove and/or such Base Building components not being in such condition described in clause (B) hereinabove, as the case may be, by the date which is ninety (90) days after the Delivery Date (the "**Non-Compliance Outside Date**"), then Tenant's sole remedy shall be that Landlord shall, at its sole cost and expense (which shall not be included in Operating Expenses), do that which is necessary to correct such non-compliance with applicable laws and/or bring such Base Building components which serve the Premises in good order, condition and repair within a reasonable period of time after Landlord's receipt of the applicable Non-Compliance Notice. If

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Tenant fails to deliver the Non-Compliance Notice to Landlord with respect to any of the matters described in clauses (A) or (B) hereinabove on or prior to the Non-Compliance Outside Date, then Landlord shall have no obligation under this <u>Section</u> <u>1.1.1.4</u> to perform the applicable work described above in such applicable clause at Landlord's sole cost and expense (but such release of such obligation shall not relieve Landlord of its other obligations under this Lease, including for the Warranty Period under <u>Section</u> <u>1.1.1.5</u> below, repairs and maintenance in <u>Section</u> <u>7.2</u> below and/or compliance with law in Article 24 below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.5 **<u>Building Systems Warranty</u>**. Notwithstanding anything in this Lease to the contrary, Landlord shall, at Landlord's sole cost and expense, repair or replace any failed or inoperable portion of the such Building Systems serving the Premises for which it receives written notice and reasonable evidence from Tenant during the first twenty-four (24) months of the initial Lease Term that such component of the Building Systems has failed or is inoperable ("**Warranty Period**"), provided that the need to repair or replace was not caused by the intentional misuse, misconduct, damage, destruction, and/or negligence of Tenant, its subtenants and/or assignees, if any, or any company which is acquired, sold or merged with Tenant (collectively, "**Tenant Damage**"), or by any modifications, Alterations or improvements constructed by or on behalf of Tenant (except for the Tenant Improvements). Landlord shall coordinate such work with Tenant and shall utilize commercially reasonable efforts to perform the same in a manner designed to minimize interference with Tenant's use of the Premises. Subject to the provisions of <u>Section</u> <u>10.5</u> below, to the extent repairs which Landlord is required to make pursuant to this <u>Section</u> <u>1.1.1.5</u> are necessitated in part by Tenant Damage, then Tenant shall reimburse Landlord for an equitable proportion of the cost of such repair.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1.6 **<u>Existing Laboratory Systems</u>**. Notwithstanding anything in this <u>Section</u> <u>1.1.1</u> above, any existing laboratory systems, including process utilities, shall be provided without warranty, in their currently existing, "as-is" condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.2 **<u>The Building and The Project</u>**. The Premises constitutes a portion of the building set forth in <u>Section</u> <u>2.1</u> of the Summary (the "**Building**"). The Building is part of an office/laboratory project currently known as "The Cove." The term "**Project**," as used in this Lease, shall mean (i) the Building and the Common Areas, (ii) the land (which is improved with landscaping, parking facilities and other improvements) upon which the Building and the Common Areas are located, (iii) the office/laboratory buildings located at The Cove, and the land upon which such adjacent office/laboratory buildings are located, (iv) the existing on-site amenity center containing approximately 30,000 square feet of amenity space (the "**Amenity Space**"), and (v) at Landlord's discretion, any additional real property, areas, land, buildings or other improvements added thereto as part of the Project, including areas that may currently be outside of the Project. Tenant acknowledges that Landlord or an affiliate of Landlord (or any successors thereto) is or may be intending to develop and construct additional buildings, parking structures, and other improvements as a part of the Project, which may be operated as part of the Project whether owned by Landlord, an affiliate of Landlord, or a third party; provided, that, any such actions shall not cause or result in an Adverse Condition. For purposes of this Lease, an "Adverse Condition" shall mean and event or condition that (i) unreasonably and materially interferes with Tenant's access to and/or use of the Premise for the Permitted Use or the parking areas, (ii) diminishes Tenant's rights and/or increases Tenant's monetary obligations under this Lease (other than to a de minimis extent). Further, during the initial Lease Term, Landlord agrees that it will not increase Tenant's Share under this Lease as a result of any of the foregoing actions.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.3 **<u>Common Areas</u>**. Tenant shall have the non-exclusive right to use in common with other tenants in the Project, and subject to the rules and regulations referred to in <u>Article 5</u> of this Lease, those portions of the Project which are provided, from time to time, for use in common by Landlord or an affiliate of Landlord or any other owner of the Project (or any portion thereof), Tenant and any other tenants of the Project (such areas, together with such other portions of the Project designated by Landlord, in its discretion, are collectively referred to herein as the "**Common Areas**"). The manner in which the Common Areas are maintained and operated shall be at the sole discretion of Landlord and the use thereof shall be subject to such rules, regulations and restrictions as Landlord may make from time to time; provided, that, the Project shall at all times have those amenities customary for similar First Class Life Science Projects. In accordance with <u>Section</u> <u>29.29</u> below, Landlord reserves the right to close temporarily, make alterations or additions to, or change the location of elements of the Project and the Common Areas, so long as such actions do not cause an Adverse Condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 **<u>Rentable Square Feet of Premises</u>**. The rentable square footage of the Premises is hereby deemed to be as set forth in <u>Section</u> <u>2.2</u> of the Summary, and shall not be subject to measurement or adjustment during the Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 **<u>Right of First Offer</u>**. Landlord hereby grants to the Original Tenant a one-time right of first offer ("**Right of First Offer**") during the period from the mutual execution and delivery of this Lease until the end of the initial Lease Term (the "**First Offer Period**"), with respect to any space that comes available on the third (3<sup>rd</sup>) floor of the Building (<u>i.e.</u>, 131 Oyster Point, only) (the "**First Offer Space**"). Notwithstanding anything in this <u>Section</u> <u>1.3</u> to the contrary, (i) such Right of First Offer shall be subordinate to all rights of expansion, renewal, extension, first refusal, first offer or similar rights granted to any other tenants for all or any portion of the First Offer Space set forth in leases of space in the Project existing as of the date hereof or hereinafter granted after Tenant is then prohibited from leasing such First Offer Space, regardless of whether such rights are executed strictly in accordance with their respective terms or pursuant to a lease amendment or a new lease (collectively, the "**Superior Rights**"); and (ii) Tenant shall have no such right of first offer pursuant to the foregoing provisions of this <u>Section</u> <u>1.3</u> during the last two (2) years of the initial Lease Term (and the First Offer Period shall be shortened to be the day immediately preceding such two (2) year period), unless either (A) as of the date Landlord delivers to Tenant the First Offer Notice pursuant to <u>Section</u> <u>1.3.1</u> below, Tenant has previously properly exercised its Extension Option to extend the initial Lease Term for the Option Term (as defined in <u>Section</u> <u>3.4</u> of the Summary), or (B) if the First Offer Notice is delivered on or before the date that is nine (9) months prior to the expiration of the initial Lease Term, then concurrently with Tenant's delivery of Tenant's First Offer Exercise Notice exercising such Right of First Offer, Tenant delivers to Landlord Tenant's Extension Exercise Notice properly exercising its Extension Option to extend the initial Lease Term for the Option Term pursuant to <u>Section</u> <u>2.2</u> below (which Tenant shall have right to do notwithstanding the time frames for delivery of Tenant's Extension Exercise Notice set forth in <u>Section</u> <u>2.2.2</u> below). Superior Rights shall continue to be Superior Rights in the event that any lease setting forth the Superior Right is renewed or otherwise modified.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.1 **<u>Procedure for Offer</u>**. Subject to Superior Rights and the terms of this <u>Section</u> <u>1.3</u>, Landlord shall notify Tenant in writing (the "**First Offer Notice**") prior to entering into a lease of First Offer Space to a third party, other than the existing occupant thereof. Pursuant to such First Offer Notice, Landlord shall offer to lease to Tenant the then available First Offer Space, consistent with the configuration in which Landlord intends to offer it for lease (the "**Designated First Offer Space**") (and such notice may be made contingent on a Superior Right Holder declining a right to lease such space). The First Offer Notice shall (i) describe the Designated First Offer Space, (ii) offer to lease to Tenant the Designated First Offer Space on the terms described in the First Offer Notice, (iii) set forth the "Economic Terms" (as that term is defined herein below) upon which Landlord is willing to lease the Designated First Offer Space to Tenant, which terms shall be consistent with fair market terms and conditions taking into account all relevant factors, (iv) set forth the rentable square footage of the Designated First Offer Space, determined by Landlord in accordance with the Landlord's then-current measurement standard for the Project, (v) describe the First Offer Term (as that term is defined below) and the anticipated delivery date for the Designated First Offer Space, (vi) specify any additional Security Deposit, letter of credit or other securitization required to be provided for the Designated First Offer Space, and (vii) specify the number and type of parking passes, if any, required to be rented by Tenant in connection with the Designated First Offer Space. The term "**Economic Terms**" means: (a) the rental rate; (b) the amount of any improvement allowance or the value of any work to be performed by Landlord in connection with the lease of such space (which amount is a deduction from the cost to Tenant or such other party); (c) the amount of free rent or abated rent; and (d) any other monetary concessions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.2 **<u>Procedure for Acceptance</u>**. If Tenant wishes to exercise Tenant's Right of First Offer with respect to the Designated First Offer Space, then within ten (10) business days of delivery of the First Offer Notice to Tenant, Tenant shall deliver notice to Landlord (the "**First Offer Exercise Notice**") of Tenant's election to exercise its Right of First Offer for the entirety (and not less than the entirety) of the Designated First Offer Space on the terms contained in such notice. If Tenant does not so notify Landlord within such ten (10) business day period, or if Tenant earlier notifies Landlord that they reject such offer for the Designated First Offer Space, then Landlord shall be free to enter into a lease ("**Third Party Lease**") for the space described in the First Offer Notice to anyone to whom Landlord desires on any terms Landlord desires. Notwithstanding anything to the contrary contained herein, Tenant must elect to exercise its right of first offer, if at all, with respect to all of the Designated First Offer Space, and Tenant may not elect to lease only a portion thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.3 **<u>First Offer Term</u>**. The term of Tenant's lease of the Designated First Offer Space (the "**First Offer Term**") shall commence upon the date (the "**First Offer Commencement Date**") set forth in the First Offer Notice and shall expire on the designated expiration date set forth in the First Offer Notice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.4 **<u>Construction In First Offer Space</u>**. Tenant shall take the Designated First Offer Space in its "as is" condition, subject to any improvement allowance included in the Economic Terms (if any), and the construction of improvements in the First Offer Space shall comply with the terms of <u>Article 8</u> of this Lease. Landlord shall have no obligation to provide any improvement allowance or perform any work in the First Offer Space except as expressly provided in the First Offer Notice.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.5 **<u>Amendment to Lease</u>**. If Tenant timely exercises Tenant's Right of First Offer to lease Designated First Offer Space, then Landlord and Tenant shall within thirty (30) days thereafter execute an amendment to this Lease expanding the Premises to include the Designated First Offer Space upon the terms and conditions as set forth in the First Offer Notice and this <u>Section</u> <u>1.3.5</u>. Notwithstanding the foregoing documentation obligations, Tenant's timely delivery of the First Offer Exercise Notice shall, in and of itself, conclusively establish Tenant's lease of the First Offer Space on the express terms set forth in this <u>Section</u> <u>1.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.6 **<u>Termination of Right of First Offer</u>**. Tenant shall not have the right to lease the First Offer Space, and Landlord has no obligation to deliver a First Offer Notice, if (i) Tenant is then in default under this Lease beyond all applicable notice and cure periods, and/or (ii) Original Tenant and/or its any Permitted Transferee to which Tenant's entire interest in this Lease has been assigned pursuant to <u>Section</u> <u>14.8</u> below (each, a "**Permitted Transferee Assignee**") has subleased twenty-five percent (25%) or more of the entire then-existing Premises, other than to a Permitted Transferee. Tenant's Right of First Offer shall terminate upon the earliest to occur of (a) as to a Designated First Offer Space, Tenant's failure to timely deliver a Tenant First Offer Exercise Notice following Landlord's delivery of a First Offer Notice, (b) Tenant's exercise of its Right of First Offer for all of the First Offer Space, (c) Tenant's assignment of this Lease, other than to a Permitted Transferee Assignee, (d) Tenant's waiver or failure to exercise any Extension Option pursuant to <u>Section</u> <u>2.2</u> below, and (e) Tenant's sublease of twenty-five percent (25%) or more of the entire then-existing Premises, other than to a Permitted Transferee for substantially the remaining Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 **<u>Existing Furniture</u>**. Effective as of the date of mutual execution and delivery of this Lease, Landlord does hereby grant, transfer, assign, and convey to Tenant, those certain items of furniture located in the Leased Premises described on **<u>Exhibit C</u>** attached hereto (collectively, the "**Existing Furniture"**) and Landlord's rights and interest therein. Tenant acknowledges and agrees that Landlord has made no, and is not making any, representations or warranties, express, implied or otherwise, regarding the Existing Furniture, including, without limitation the condition or working order of the Existing Furniture or the fitness of the Existing Furniture for any particular use (provided, that, Landlord hereby represents and warrants that Landlord has full right and authority to transfer and convey the Existing Furniture to Tenant free and clear of rights of others). Tenant hereby confirms that it is satisfied with the Existing Furniture and hereby accepts the Furniture "AS IS AND WITH ALL FAULTS" as of the date of mutual execution and delivery of this Lease. Notwithstanding anything to the contrary in this Lease, from and after the date of mutual execution and delivery of this Lease: (i) as between Landlord and Tenant, the Existing Furniture shall at all times under this Lease be deemed to be the personal property of Tenant, and as a result, Tenant shall be solely responsible, at Tenant's sole cost and expense, for maintaining, repairing and insuring the Existing Furniture and otherwise complying with respect to the Existing Furniture with all of the terms and provisions of this Lease pertaining to Tenant's personal property; and (ii) on or prior to the expiration or earlier termination of this Lease, in accordance with the surrender provisions of this Lease, Tenant shall, at its expense, remove or cause to be removed from the Leased Premises such Existing Furniture and repair all damage to the Leased Premises and Building resulting from such removal.

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**2. LEASE TERM; OPTION TERM** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 **<u>Lease Term</u>**. The terms and provisions of this Lease shall be effective as of the Effective Date. The term of this Lease (the "**Lease Term**") shall be as set forth in <u>Section</u> <u>3.1</u> of the Summary, shall commence on the date set forth in <u>Section</u> <u>3.2</u> of the Summary (the "**Lease Commencement Date**"), and shall terminate on the date set forth in <u>Section</u> <u>3.3</u> of the Summary (the "**Lease Expiration Date**") unless this Lease is sooner terminated as hereinafter provided. For purposes of this Lease, the term "**Lease Year**" shall mean each consecutive twelve (12) month period during the Lease Term, provided that if the Lease Commencement Date occurs on other than the first day of a month, the first "Lease Year" shall commence on the Lease Commencement Date and end on the last day of the month in which the first anniversary of the Lease Commencement Date occurs (or if the Lease Commencement Date is the first day of a calendar month, then the first Lease Year shall commence on the Lease Commencement Date and end on the day immediately preceding the first anniversary of the Lease Commencement Date), and the second and each succeeding Lease Year shall commence on the first day of the next calendar month; and further provided that the last Lease Year shall end on the Lease Expiration Date. The term "**Lease Month**" shall mean each succeeding calendar month during the Lease Term; provided, however, that the first Lease Month shall commence on the Lease Commencement Date and shall end on the last day of the first (1<sup>st</sup>) full calendar month of the Lease Term (or if the Lease Commencement Date is the first day of a calendar month, then the first Lease Month shall be that calendar month) and that the last Lease Month shall expire on the Lease Expiration Date. At any time during the Lease Term, once the Lease Commencement Date has been determined in accordance with <u>Section</u> <u>3.2</u> of the Summary, Landlord may deliver to Tenant a written notice memorializing such Lease Commencement Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 **<u>Extension Option(s)</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1 **<u>Option Right</u>**. Upon the proper exercise of any Extension Option in accordance with the provisions of this <u>Section</u> <u>2.2</u> by Original Tenant or any assignee of Original Tenant's entire interest in the Lease that has been approved in accordance with the terms of <u>Article 14</u>, below (a "**Permitted Assignee"**), the Lease Term shall be extended for the applicable Option Term. Such Extension Options shall be exercisable only by written notice delivered by Tenant to Landlord not more than twelve (12) months nor less than nine (9) months prior to the expiration of the initial Lease Term (the "**Extension Exercise Notice**"), stating that Tenant is thereby irrevocably exercising its Extension Option to lease all but not less than all of the Premises then leased by Tenant (including any First Offer Space then leased by Tenant) (the "**Renewal Premise**s") during the Option Term. Upon the proper exercise of the Extension Option, and provided that, as of the date of delivery of such notice, Tenant is not in default beyond all applicable notice and cure periods under this Lease, and as of the end of the initial Lease Term, Tenant is not in default beyond all applicable notice and cure periods under this Lease, the Lease Term shall be extended for a period of five (5) years (provided, that, Landlord, in Landlord's sole and absolute discretion, may waive such conditions). The rights contained in this <u>Section</u> <u>2.2</u> shall be personal to Original Tenant and any Permitted Assignee (and not any other assignee, sublessee or "Transferee," as that term is defined in <u>Section</u> <u>14.1</u>, below, of Tenant's interest in this Lease). In the event that Tenant fails to timely and appropriately exercise its option to extend the Lease Term, in accordance with the terms of this <u>Section</u> <u>2.2</u>, then such option shall automatically terminate and shall be of no further force or effect. Further, notwithstanding anything to the contrary herein, Tenant's Extension Option shall terminate upon the earliest to occur of (i) Tenant's assignment of this Lease, other than to a Permitted Assignee, and (ii) Tenant's sublease of twenty-five percent (25%) or more of the entire then-existing Premises, other than to a Permitted Transferee for substantially the remaining Lease Term.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2 **<u>Option Rent</u>**. The annual Rent payable by Tenant during the Option Term (the "**Option Rent**") shall be equal to the "Fair Rental Value," as that term is defined below, for the Renewal Premises as of the commencement date of the Option Term (and include designated annual increases as a part of such Fair Rental Value). Landlord shall have the right to require Tenant to provide new and/or additional security in the form of a cash security deposit and/or letter of credit, in amounts reasonably determined by Landlord (not to exceed a total security deposit amount [as so increased] equal to the first two (2) months of Base Rent [not including Tenant's Share of Direct Expenses] for the Premises for the Option Term), based upon Landlord's review of Tenant's financial statements (and in connection therewith, Tenant shall provide the financial statements referenced in <u>Section</u> <u>17.2</u> of this Lease within ten (10) business days of Landlord's request) based on Landlord's review of financial security then generally being imposed in Comparable Transactions from tenants of comparable financial condition and credit history, as compared to the then existing financial condition and credit history of Tenant (and giving reasonable consideration to Tenant's prior performance history during the Lease Term). The "**Fair Rental Value**," as used in this Lease, shall be equal to the annual rent per rentable square foot, including all escalations, at which tenants (pursuant to leases consummated within the twelve (12) month period preceding the first day of the Option Term), are leasing non-sublease space which is not significantly greater or smaller in size than the subject space, with a comparable level of improvements (excluding any property that Tenant would be allowed to remove from the Renewal Premises at the termination of the Lease), for a comparable lease term, in an arm's length transaction, which comparable space is located in the "Comparable Buildings," as that term is defined in this <u>Section</u> <u>2.2.2</u>, below (transactions satisfying the foregoing criteria shall be known as the "**Comparable Transactions**"), taking into consideration all relevant customary factors and the following concessions (the "**Concessions**"): (a) rental abatement concessions, if any, being granted such tenants in connection with such comparable space; (b) tenant improvements or allowances provided or to be provided for such comparable space, and taking into account the value, if any, of the existing improvements in the subject space (other than improvements installed by Tenant at Tenant's sole cost and expense), such value to be based upon the age, condition, design, quality of finishes and layout of the improvements and the extent to which the same can be utilized by a general office/lab user other than Tenant; and (c) other reasonable monetary concessions being granted such tenants in connection with such comparable space; provided, however, that in calculating the Fair Rental Value, no consideration shall be given to the fact that Landlord is or is not required to pay a real estate brokerage commission in connection with Tenant's exercise of its right to extend the Lease Term, or the fact that landlords are or are not paying real estate brokerage commissions in connection with such comparable space. The Concessions shall be reflected in the effective rental rate (which effective rental rate shall take into consideration the total dollar value of such Concessions as amortized on a straight-line basis over the applicable term of the Comparable Transaction (in which case such Concessions evidenced in the effective rental rate shall not be granted to Tenant)) payable by Tenant. The term "**Comparable Buildings**" shall mean the Building and those other life sciences buildings which are comparable to the Building in terms of age (based upon the date of completion of construction or major renovation of to the building), quality of construction, level of services and amenities, size and appearance, and are located in South San Francisco, California and the surrounding commercial area.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3 **<u>Determination of Option Rent</u>**. In the event Tenant timely and appropriately exercises an option to extend the Lease Term, Landlord shall notify Tenant of Landlord's determination of the Option Rent within thirty (30) days thereafter. If Tenant, on or before the date which is ten (10) business days following the date upon which Tenant receives Landlord's determination of the Option Rent, in good faith objects to Landlord's determination of the Option Rent, then Landlord and Tenant shall attempt to agree upon the Option Rent using their best good-faith efforts. If Landlord and Tenant fail to reach agreement within ten (10) business days following Tenant's objection to the Option Rent (the "**Outside Agreement Date**"), then Tenant shall have the right to withdraw its exercise of the option by delivering written notice thereof to Landlord within five (5) days thereafter, in which event Tenant's right to extend the Lease pursuant to this <u>Section</u> <u>2.2</u> shall be of no further force or effect. If Tenant does not withdraw its exercise of the extension option, each party shall make a separate determination of the Option Rent, as the case may be, within ten (10) days after the Outside Agreement Date, and such determinations shall be submitted to arbitration in accordance with <u>Sections 2.2.3.1</u> through <u>2.2.3.7</u>, below. If Tenant fails to object to Landlord's determination of the Option Rent within the time period set forth herein, then Tenant shall be deemed to have accepted Landlord's determination of Option Rent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.1 Landlord and Tenant shall each appoint one arbitrator who shall be a real estate appraiser who shall have been active over the ten (10) year period ending on the date of such appointment in the appraisal of other First Class Life Sciences Projects located in the South San Francisco market area. The determination of the arbitrators shall be limited solely to the issue of whether Landlord's or Tenant's submitted Option Rent is the closest to the actual Option Rent, taking into account the requirements of <u>Section</u> <u>2.2.2</u> of this Lease, as determined by the arbitrators. Each such arbitrator shall be appointed within fifteen (15) days after the Outside Agreement Date. Landlord and Tenant may consult with their selected arbitrators prior to appointment and may select an arbitrator who is favorable to their respective positions. The arbitrators so selected by Landlord and Tenant shall be deemed "**Advocate Arbitrators**."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.2 The two (2) Advocate Arbitrators so appointed shall be specifically required pursuant to an engagement letter within ten (10) days of the date of the appointment of the last appointed Advocate Arbitrator to agree upon and appoint a third arbitrator ("**Neutral Arbitrator**") who shall be qualified under the same criteria set forth hereinabove for qualification of the two Advocate Arbitrators, except that neither the Landlord or Tenant or either parties' Advocate Arbitrator may, directly or indirectly, consult with the Neutral Arbitrator prior or subsequent to his or her appearance. The Neutral Arbitrator shall be retained via an engagement letter jointly prepared by Landlord's counsel and Tenant's counsel.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.3 The three arbitrators shall, within thirty (30) days of the appointment of the Neutral Arbitrator, reach a decision as to whether the parties shall use Landlord's or Tenant's submitted Option Rent, and shall notify Landlord and Tenant thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.4 The decision of the majority of the three arbitrators shall be binding upon Landlord and Tenant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.5 If either Landlord or Tenant fails to appoint an Advocate Arbitrator within fifteen (15) days after the Outside Agreement Date, then either party may petition the presiding judge of the Superior Court of San Mateo County to appoint such Advocate Arbitrator subject to the criteria in <u>Section</u> <u>2.2.3.1</u> of this Lease, or if he or she refuses to act, either party may petition any judge having jurisdiction over the parties to appoint such Advocate Arbitrator.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.6 If the two (2) Advocate Arbitrators fail to agree upon and appoint the Neutral Arbitrator, then either party may petition the presiding judge of the Superior Court of San Mateo County to appoint the Neutral Arbitrator, subject to criteria in <u>Section</u> <u>2.2.3.1</u> of this Lease, or if he or she refuses to act, either party may petition any judge having jurisdiction over the parties to appoint such arbitrator.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.3.7 The cost of the arbitration shall be paid by Landlord and Tenant equally.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.4 In the event that the Option Rent shall not have been determined pursuant to the terms hereof prior to the commencement of the Option Term, Tenant shall be required to pay the Option Rent initially provided by Landlord to Tenant, and upon the final determination of the Option Rent, the payments made by Tenant shall be reconciled with the actual amounts of Option Rent due, and the appropriate party shall make any corresponding payment to the other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 **<u>Early Termination Right Re: New Lease</u>**. In the event that Landlord and Tenant fully execute and deliver a new lease agreement (the "**New Lease**") for other space in the Project or in a project located in South San Francisco or the surrounding commercial area that is owned by Landlord or an affiliate of Landlord during the Lease Term which New Lease satisfies the following conditions: (i) a term for such New Lease which extends beyond the Lease Expiration Date of this Lease, and (ii) the premises under such New Lease contains no less than 70,000 rentable square feet of space, and provided that Tenant is not then in default of this Lease beyond the applicable notice and cure periods, then Tenant shall have the right to terminate this Lease without the payment of any penalty or termination fee upon not less than thirty (30) days' prior written notice to Landlord (the "**Tenant Termination Notice**"), which Tenant Termination Notice must be given within thirty (30) days after the mutual execution and delivery of the New Lease. Such Tenant Termination Notice shall set forth the termination date of this Lease (the "**Tenant Early Termination Date**"). To the extent Tenant exercises its right to terminate this Lease, pursuant to the terms of this <u>Section</u> <u>2.3</u>, then this Lease shall terminate effective as of the Tenant Early Termination Date with the same force and effect as if the Lease were scheduled to expire in accordance with its terms as of such Tenant Early Termination Date, subject to the provisions of this Lease which expressly survive the expiration or earlier termination of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 **<u>Early Entry Period</u>**. Provided that Tenant does not unreasonably interfere with the performance of the Tenant Improvements, and subject to the acceptance of inconvenience in <u>Section</u> <u>5.2</u> of the Tenant Work Letter, during the 15-day period (the "**Early Entry Period**") commencing on the Delivery Date and continuing until the end of the day immediately before the occurrence of the Lease Commencement Date (subject to any earlier termination of this Lease), Tenant shall be permitted to access and occupy the Premises for the purposes of Tenant installing

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Tenant's furniture, fixtures and equipment and cabling and wiring in the Premises. Such early entry and occupancy by Tenant shall be subject to all of the terms and conditions of this Lease, including, without limitation, the indemnification and insurance provisions of Article 10 below (including Tenant's obligation to provide Landlord with evidence of insurance covering the Premises), except that Tenant will not be obligated to pay Base Rent or Tenant's Share of Direct Expenses for the Premises during the Early Entry Period (until the Lease Commencement Date). In addition, prior to and as a condition to such entry, Tenant shall have paid to Landlord all amounts required to be paid by Tenant concurrently with the execution and delivery of this Lease (including, without limitation, delivery of the Letter of Credit).

**3. BASE RENT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 **<u>In General</u>**. Tenant shall pay to Landlord, without prior notice or demand, base rent ("**Base Rent**") as set forth in <u>Section</u> <u>4</u> of the Summary, payable in monthly installments as set forth in <u>Section</u> <u>4</u> of the Summary in advance on or before the first day of each and every calendar month during the Lease Term, without any setoff or deduction whatsoever. In accordance with <u>Section</u> <u>4</u> of the Summary, any increases in Base Rent shall occur on the first day of the applicable Lease Month. However, if the first Lease Month pertains to a period longer than one (1) calendar month, then Base Rent for such first Lease Month shall be equal to one (1) calendar month's Base Rent plus prorated Base Rent for the partial calendar month also included in such first Lease Month. The prepaid Base Rent, plus Direct Expenses, set forth in <u>Section</u> <u>14</u> of the Summary shall be paid at the time of Tenant's execution and delivery of this Lease. All payments required to be made by Tenant to Landlord hereunder (including, without limitation, Base Rent) shall be paid to Landlord or Landlord's agent, at Landlord's option, by wire transfer, Electronic Funds Transfer, at the management office of the Project or at such other place or method as Landlord may from time to time designate in writing, in immediately available funds that, at the time of payment, are legal tender for private or public debts in the United States of America. If no time period for payment is specified in this Lease, Tenant shall make all required payments within thirty (30) days of Landlord's request and delivery of an invoice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 **<u>Base Rent Abatement</u>**. Subject to the terms and conditions of this Lease, Tenant shall not be obligated to pay any Base Rent otherwise attributable to the Premises with respect to the Premises which is attributable to the first ten (10) full calendar months of the initial Lease Term (collectively, the "**Base Rent Abatement**"), provided, however, Tenant shall be required to pay Tenant's Share of Direct Expenses attributable to such period, as well as for all utilities and other services. The maximum aggregate amount of the Base Rent Abatement shall be equal to $2,066,722.50 (i.e., $206,672.25 per month).

**4. ADDITIONAL RENT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 **<u>General Terms</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1 **<u>Direct Expenses; Additional Rent</u>**. In addition to paying the Base Rent specified in <u>Article 3</u> of this Lease, Tenant shall pay "**Tenant's Share**" of the annual "**Direct Expenses**," as those terms are defined in <u>Sections 4.2.5</u> and <u>4.2.1</u> of this Lease, respectively. Such payments by Tenant, together with any and all other amounts payable by Tenant to Landlord pursuant to the terms of this Lease, are hereinafter collectively referred to as the "**Additional** 

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 **Rent**," and the Base Rent and the Additional Rent are herein collectively referred to as "**Rent**." All amounts due under this <u>Article 4</u> as Additional Rent shall be payable for the same periods and in the same manner as the Base Rent. Without limitation on other obligations of Tenant which survive the expiration of the Lease Term, the obligations of Tenant to pay the Additional Rent provided for in this <u>Article 4</u> shall survive the expiration of the Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.2 **<u>Triple Net Lease</u>**. Landlord and Tenant acknowledge that, except as otherwise provided to the contrary in this Lease, it is their intent and agreement that this Lease be a "**TRIPLE NET**" lease and that as such, the provisions contained in this Lease are intended to pass on to Tenant or reimburse Landlord for the costs and expenses reasonably associated with this Lease, the Building and the Project, and Tenant's operation therefrom, subject to all express terms and conditions of this Lease, including this <u>Article 4</u>, and further including with respect to Tenant's payment of Tenant's Share of Direct Expenses and all limitations and/or exclusions pertaining thereto. To the extent such costs and expenses payable by Tenant cannot be charged directly to, and paid by, Tenant, such costs and expenses shall be paid by Landlord but reimbursed by Tenant as Additional Rent, subject to all other terms and conditions of this Lease, including this Article 4.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 **<u>Definitions of Key Terms Relating to Additional Rent</u>**. As used in this <u>Article 4</u>, the following terms shall have the meanings hereinafter set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.1 "Direct Expenses" shall mean "Operating Expenses" and "Tax Expenses."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.2 "**Expense Year**" shall mean each calendar year in which any portion of the Lease Term falls, through and including the calendar year in which the Lease Term expires, provided that Landlord, upon reasonable prior written notice to Tenant, may change the Expense Year from time to time to any other twelve (12) consecutive month period, and, in the event of any such change, Tenant's Share of Direct Expenses shall be equitably adjusted for any Expense Year involved in any such change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.3 "**Operating Expenses**" shall mean all expenses, costs and amounts of every kind and nature which Landlord pays, accrues or amortizes during any Expense Year because of or in connection with the ownership, management, maintenance, security, repair, replacement, renovation, restoration or operation of the Project or any portion thereof (including, without limitation, all Common Areas and the Amenity Space), in accordance with sound real estate management and accounting practices. Without limiting the generality of the foregoing, Operating Expenses shall specifically include any and all of the following: (i) the cost of supplying all utilities, the cost of operating, repairing, replacing, maintaining, renovating and restoring the utility, telephone, mechanical, sanitary, storm drainage, and elevator systems, and the cost of maintenance and service contracts in connection therewith; (ii) the cost of licenses, certificates, permits and inspections and the cost of contesting any governmental enactments which may affect Operating Expenses, and the costs incurred in connection with a governmentally mandated transportation system management program or similar program; (iii) the cost of all insurance carried by Landlord in connection with the Project and Premises as reasonably determined by Landlord; (iv) the cost of landscaping, relamping, and all supplies, tools, equipment and materials used in the operation, repair and maintenance of the Project, or any portion thereof; (v) the cost of parking area operation, repair, restoration, and maintenance; (vi) fees and other costs, including

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management and/or incentive fees (subject to clause (p) below), consulting fees, contractor fees, legal fees and accounting fees in connection with the management, operation, maintenance, replacement, renovation, repair and restoration of the Project; (vii) payments under any equipment rental agreements; (viii) subject to item (f), below, wages, salaries and other compensation and benefits, including taxes levied thereon, of all persons engaged in the operation, maintenance and security of the Project; (ix) rent or imputed rent for any office space made available for Project management personnel (subject to the terms of item (m), below); (x) operation, repair, maintenance and replacement of all systems and equipment and components thereof of the Project; (xi) the cost of janitorial, alarm, security and other services, replacement of wall and floor coverings, ceiling tiles and fixtures in common areas, maintenance and replacement of curbs and walkways, repair to roofs and re-roofing; (xii) amortization (including interest on the unamortized cost) over the useful life or such longer period of time as Landlord shall reasonably determine, of the cost of acquiring or the rental expense of personal property used in the maintenance, operation and repair of the Project, or any portion thereof; (xiii) the cost of capital improvements or other costs incurred in connection with the Project (A) which are intended to effect economies in the operation or maintenance of the Project, or any portion thereof, or to reduce current or future Operating Expenses, (B) that are required to comply with present or future then-implemented conservation programs, (C) incurred by Landlord in connection with any of the items described in item (xii) above or item (xiv) below, (D) required for Landlord to perform Landlord's obligations under this Lease to repair, maintain and operate the Project as a First Class Life Sciences Project, (E) that are required under any Applicable Laws (as defined in <u>Section</u> <u>24.1</u> of this Lease), or (F) replacements or modifications of equipment or other items located in or serving the Common Areas required to keep the Common Areas in good order or condition; provided, however, that any capital expenditure shall be amortized with interest at the "Interest Rate" (as that term is defined in <u>Article 25</u> below) over its useful life as Landlord shall reasonably determine in accordance with sound real estate management and accounting practices (provided, however, with respect to those items included under item (A) above, Landlord shall have the right to amortize the same over their recovery/payback period as Landlord shall reasonably determine in accordance with sound real estate management and accounting practices); (xiv) costs, fees, charges or assessments imposed by, or resulting from any mandate imposed on Landlord by, any federal, state or local government for fire and police protection, trash removal, community services, or other services which do not constitute "Tax Expenses" as that term is defined in <u>Section</u> <u>4.2.5</u>, below, (xv) cost of tenant relation programs reasonably established by Landlord, and (xvi) payments under any easement, license, operating agreement, declaration, restrictive covenant, or instrument pertaining to the sharing of costs by the Building, including, without limitation, any covenants, conditions and restrictions affecting the property, and reciprocal easement agreements affecting the property, any parking licenses, and any agreements with transit agencies affecting the Project (collectively, "**Underlying Documents**").

Notwithstanding the foregoing, for purposes of this Lease, Operating Expenses shall not, however, include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) costs, including legal fees, space planners' fees, advertising and promotional expenses (except as otherwise set forth above), and brokerage fees incurred in connection with the original construction or development, or original or future leasing of the Project, and costs, including permit, license and inspection costs, incurred with respect to the installation of tenant improvements made for other tenants in the Project or incurred in renovating or otherwise improving, decorating, painting or redecorating vacant space for tenants or other occupants of the Project (excluding, however, such costs relating to any common areas of the Project or parking facilities);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) except in connection with items (xii) and (xiii) above, depreciation, interest and principal payments on mortgages and other debt costs, if any, penalties and interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) costs for which the Landlord is reimbursed by any tenant or occupant of the Project or by insurance by its carrier or any tenant's carrier or by anyone else (except to the extent of commercially reasonable deductibles), and electric power costs for which any tenant directly contracts with the local public service company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any bad debt loss, rent loss, or reserves for bad debts or rent loss;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) costs associated with the operation of the business of the partnership or entity which constitutes the Landlord, as the same are distinguished from the costs of operation of the Project (which shall specifically include, but not be limited to, accounting costs associated with the operation of the Project). Costs associated with the operation of the business of the partnership or entity which constitutes the Landlord include costs of partnership accounting and legal matters, costs of defending any lawsuits with any mortgagee (except as the actions of the Tenant may be in issue), costs of selling, syndicating, financing, mortgaging or hypothecating any of the Landlord's interest in the Project, and costs incurred in connection with any disputes between Landlord and its employees, between Landlord and Project management, or between Landlord and other tenants or occupants;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the wages and benefits of any employee who does not devote substantially all of his or her employed time to the Project unless such wages and benefits are prorated to reflect time spent on operating and managing the Project vis-a-vis time spent on matters unrelated to operating and managing the Project; provided, that in no event shall Operating Expenses include wages and/or benefits attributable to personnel above the level of a senior portfolio manager, or its equivalent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) amount paid as ground rental for the Project by the Landlord;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) except for a management fee, overhead and profit increment paid to the Landlord or to subsidiaries or affiliates of the Landlord for services in the Project to the extent the same exceeds the costs of such services rendered by qualified, first-class unaffiliated third parties;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any compensation paid to clerks, attendants or other persons in commercial concessions operated by the Landlord, provided that any compensation paid to any concierge or parking attendants at the Project shall be includable as an Operating Expense;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) rentals and other related expenses incurred in leasing air conditioning systems, elevators or other equipment which if purchased the cost of which would be excluded from Operating Expenses as a capital cost, except equipment not affixed to the Project which is used in providing engineering, janitorial or similar services and, further excepting from this exclusion such equipment rented or leased to remedy or ameliorate an emergency condition in the Project;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) all items and services for which Tenant or any other tenant in the Project reimburses Landlord directly and separately from Operating Expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) any costs expressly excluded from Operating Expenses elsewhere in this Lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) rent or imputed rent for any office space occupied by Project management personnel to the extent the size or rental rate of such office space exceeds the size or fair market rental value of office space occupied by management personnel of the Comparable Buildings, with adjustment where appropriate for the size of the applicable project;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) costs arising from the negligence or willful misconduct of Landlord in connection with this Lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) costs incurred to comply with Applicable Laws relating to the removal of "Hazardous Material" (as defined in <u>Section</u> <u>5.3</u> below) that was in existence in the Building or on the Project prior to the Delivery Date, or that was brought into the Building or onto the Project after the Delivery Date by Landlord or any other "Landlord Parties" (as that term is defined in <u>Section</u> <u>10.1</u> below), and was of such a nature that a federal, state, local or municipal governmental authority would have required removal or other containment, if it had then had knowledge of the presence of such hazardous material, in the state, and under the conditions that it then existed in the Building or on the Project, but only to the extent those Applicable Laws were then being actively enforced by the applicable government authority;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) fees payable by Landlord for management of the Project in excess of three percent (3.0%) (the "**Management Fee Cap**") of Base Rent, based on Tenant paying full Base Rent, without regard to the Base Rent Abatement or other similar future free rent, half-rent and the like, for any calendar year or portion thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) attorneys' fees and other costs and expenses incurred in connection with negotiations or disputes with present or prospective tenants or other occupants or prospective occupants of the Project (including costs incurred due to violations by tenants of the terms and conditions of their leases), or any other attorneys' fees incurred in connection with the Project (including, without limitation, any financing, sale or syndication of the Project), except (A) as specifically enumerated as an Operating Expense in this Lease or (B) as and to the extent the expenditure of such attorneys' fees generally benefits the tenants of the Building;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) costs incurred to comply with applicable laws with respect to the cleanup, removal, investigation and/or remediation of any Hazardous Materials in, on or under the Project and/or the Building to the extent such Hazardous Materials are: (1) in existence as of the Lease Commencement Date and in violation of applicable laws in effect as of the Lease Commencement Date; or (2) introduced onto the Project and/or the Building after the Lease Commencement Date by Landlord or any of Landlord's agents, employees, contractors or other tenants (or other third parties that are not Tenant or any Tenant Parties) in violation of applicable laws in effect at the date of introduction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) costs of correcting defects in the initial design or construction of the Building or Project;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) costs (including, without limitation, fines, penalties, interest, and costs of repairs, replacements, alterations and/or improvements) incurred in bringing the Project into compliance with laws in effect as of the Lease Commencement Date and as interpreted by applicable governmental authorities as of such date, including, without limitation, any costs to correct building code violations pertaining to the initial design or construction of the Building, the parking facilities or any other improvements to the Project, to the extent such violations exist as of the Lease Commencement Date under any applicable laws in effect and as interpreted by applicable governmental authorities as of such date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) costs of items considered capital improvements, capital repairs, capital replacements, and/or capital equipment, all as determined in accordance with standard real estate accounting practices, except as specifically permitted in <u>Sections 4.2.3(xii)</u> or <u>(xiii)</u> above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) costs of capital repairs to the extent that such repairs are necessary as a result of a casualty, except for commercially reasonable deductible amounts not exceeding deductible amounts ordinarily obtained by institutional owners of comparable First Class Life Science Projects (provided any such deductible amounts pertaining to capital expenditures shall be excluded);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) costs incurred by Landlord due to the violation by Landlord of the terms and conditions of any lease of space within the Project;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) interest, penalties or other costs arising out of Landlord's failure to make timely payment of any of its obligations under this Lease, including, without limitation, Landlord's failure to make timely payment of any item that is included in Direct Expenses; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) any other expenses which are not specifically identified herein as being included in Operating Expenses, where such expenses would not normally be treated as a cost of operation (to be reimbursed by tenants) by institutional owners of comparable First Class Life Science Projects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.4 If Landlord is not furnishing any particular work or service (the cost of which, if performed by Landlord, would be included in Operating Expenses) to a tenant who has undertaken to perform such work or service in lieu of the performance thereof by Landlord, Operating Expenses shall be deemed to be increased by an amount equal to the additional Operating Expenses which would reasonably have been incurred during such period by Landlord if it had at its own expense furnished such work or service to such tenant. If the Project is not at least one hundred percent (100%) occupied during all or a portion of any Expense Year, Landlord shall make an appropriate adjustment to the components of Operating Expenses for such year to determine the amount of Operating Expenses that would have been incurred had the Project been one hundred percent (100%) occupied; and the amount so determined shall be deemed to have been the amount of Operating Expenses for such year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.5 **<u>Tax Expenses</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.5.1 **<u>Inclusions</u>**. "**Tax Expenses**" shall mean all federal, state, county, or local governmental or municipal taxes, fees, charges or other impositions of every kind and nature, whether general, special, ordinary or extraordinary (including, without limitation, real estate taxes, general and special assessments, transit taxes, leasehold taxes or taxes based upon the receipt of rent, including gross receipts or sales taxes applicable to the receipt of rent, personal property taxes imposed upon the fixtures, machinery, equipment, apparatus, systems and equipment, appurtenances, furniture and other personal property used in connection with the Project, or any portion thereof), which shall be paid or accrued during any Expense Year (without regard to any different fiscal year used by such governmental or municipal authority) because of or in connection with the ownership, leasing and operation of the Project, or any portion thereof, including, without limitation: (i) any tax on the rent, right to rent or other income from the Project, or any portion thereof, or as against the business of leasing the Project, or any portion thereof; (ii) any assessment, tax, fee, levy or charge in addition to, or in substitution, partially or totally, of any assessment, tax, fee, levy or charge previously included within the definition of real property tax, it being acknowledged by Tenant and Landlord that Proposition 13 was adopted by the voters of the State of California in the June 1978 election ("**Proposition 13**") and that assessments, taxes, fees, levies and charges may be imposed by governmental agencies for such services as fire protection, street, sidewalk and road maintenance, refuse removal and for other governmental services formerly provided without charge to property owners or occupants, and, in further recognition of the decrease in the level and quality of governmental services and amenities as a result of Proposition 13; (iii) any governmental or private assessments or the Project's contribution towards a governmental or private cost-sharing agreement for the purpose of augmenting or improving the quality of services and amenities normally provided by governmental agencies; (iv) any assessment, tax, fee, levy, or charge allocable to or measured by the area of the Premises or the Rent THE COVE payable hereunder, including, without limitation, any business or gross income tax or excise tax with respect to the receipt of such rent, or upon or with respect to the possession, leasing, operating, management, maintenance, alteration, repair, use or occupancy by Tenant of the Premises, or any portion thereof; (v) any assessment, tax, fee, levy or charge, upon

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this transaction or any document to which Tenant is a party, creating or transferring an interest or an estate in the Premises; and (vi) all of the real estate taxes and assessments imposed upon or with respect to the Building and all of the real estate taxes and assessments imposed on the land and improvements comprising the Project. All assessments paid by Landlord as part of Tax Expenses, which are not specifically charged to Tenant because of what Tenant has done, and which can be paid by Landlord in installments without the imposition of any fines, penalties, fees or interest, shall be paid by Landlord in the maximum number of installments permitted by applicable laws (except to the extent inconsistent with the general practice of the institutional owners of First Class Life Science Projects) and shall be included as Tax Expenses in the Expense Year in which the assessment installment has been actually paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.5.2 **<u>In General</u>**. Any costs and expenses (including, without limitation, reasonable attorneys' and consultants' fees) incurred in attempting to protest, reduce or minimize Tax Expenses shall be included in Tax Expenses in the Expense Year such expenses are paid. Tax refunds shall be credited against Tax Expenses and refunded to Tenant regardless of when received, based on the Expense Year to which the refund is applicable, provided that in no event shall the amount to be refunded to Tenant for any such Expense Year exceed the total amount paid by Tenant as Additional Rent under this <u>Article 4</u> for such Expense Year. If Tax Expenses for any period during the Lease Term or any extension thereof are increased after payment thereof for any reason, including, without limitation, error or reassessment by applicable governmental or municipal authorities, Tenant shall pay Landlord upon demand Tenant's Share of any such increased Tax Expenses. Notwithstanding anything to the contrary contained in this <u>Section</u> <u>4.2.5</u>, there shall be excluded from Tax Expenses (i) all excess profits taxes, franchise taxes, gift taxes, capital stock taxes, inheritance and succession taxes, estate taxes, federal and state income taxes, and other taxes to the extent applicable to Landlord's net income (as opposed to rents, receipts or income attributable to operations at the Project), (ii) any items included as Operating Expenses, (iii) any fines or penalties resulting from Landlord's failure to timely pay any taxes or assessments when due, (iv) and (iii) any items paid by Tenant under <u>Section</u> <u>4.5</u> of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.6 "**Tenant's Share**" shall mean the percentage set forth in <u>Section</u> <u>6</u> of the Summary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 **<u>Allocation of Direct Expenses</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.1 **<u>Method of Allocation</u>**. The parties acknowledge that the Building is a part of a multibuilding project and that the costs and expenses incurred in connection with the Project (i.e., the Direct Expenses) should be shared between the Building and the other buildings in the Project. Accordingly, as set forth in <u>Section</u> <u>4.2</u> above, Direct Expenses (which consist of Operating Expenses and tax Expenses) are determined annually for the Project as a whole, and a portion of the Direct Expenses, which portion shall be determined by Landlord on an equitable (and Project-wide consistent) basis, shall be allocated to the Building (as opposed to other buildings in the Project). Such portion of Direct Expenses allocated to the Building shall include all Direct Expenses attributable solely to the Building and an equitable portion of the Direct Expenses attributable to the Project as a whole, and shall not include Direct Expenses attributable solely to other buildings in the Project.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.2 **<u>Cost Pools</u>**. Landlord shall have the right, from time to time, to equitably allocate some or all of the Direct Expenses for the Project among different portions or occupants of the Project (the "**Cost Pools**"), in Landlord's reasonable discretion. Such Cost Pools may include, but shall not be limited to, the office space tenants of a building of the Project or of the Project, and the laboratory space tenants of a building of the Project or of the Project. The Direct Expenses within each such Cost Pool shall be allocated and charged to the tenants within such Cost Pool in an equitable manner.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 **<u>Calculation and Payment of Additional Rent</u>**. Tenant shall pay to Landlord, in the manner set forth in <u>Section</u> <u>4.4.1</u>, below, and as Additional Rent, Tenant's Share of Direct Expenses for each Expense Year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.1 **<u>Statement of Actual Direct Expenses and Payment by Tenant</u>**. Following the end of each Expenses Year, Landlord shall give to Tenant a statement (the "**Statement**") which shall state in general major categories the Direct Expenses incurred or accrued for the particular Expense Year, and which shall indicate the amount of Tenant's Share of Direct Expenses. Upon receipt of the Statement for each Expense Year commencing or ending during the Lease Term, Tenant shall pay, with its next installment of Base Rent due, the full amount of Tenant's Share of Direct Expenses for such Expense Year, less the amounts, if any, paid during such Expense Year as "**Estimated Direct Expenses**," as that term is defined in <u>Section</u> <u>4.4.2</u>, below, and if Tenant paid more as Estimated Direct Expenses than the actual Tenant's Share of Direct Expenses, Tenant shall receive a credit in the amount of Tenant's overpayment against Rent next due under this Lease. Even though the Lease Term has expired and Tenant has vacated the Premises, when the final determination is made of Tenant's Share of Direct Expenses for the Expense Year in which this Lease terminates, Tenant shall immediately pay to Landlord such amount, and if Tenant paid more as Estimated Direct Expenses than the actual Tenant's Share of Direct Expenses, Landlord shall apply such overpayment against any unpaid Rent, and within thirty (30) days, deliver a check payable to Tenant in the amount of any remaining overpayment. Landlord shall endeavor to deliver the applicable Statement to Tenant within one hundred twenty (120) days after the end of the Expense Year in question, but the failure of Landlord to furnish such Statement within such 120-day period shall not prejudice Landlord from enforcing its rights under this <u>Article 4</u>; provided, however, Landlord's failure to provide Tenant with a Statement for a particular Expense Year within eighteen (18) months after the end of the Expense Year in question shall constitute a waiver of Landlord's right to collect any additional amounts of Tenant's Share of Direct Expenses which would otherwise have been payable for such Expense Year pursuant to such Statement; provided further, however, that such limitation on Landlord's ability to collect any such additional amounts of Tenant's Share of Direct Expenses as a result of any late delivery of such Statement shall not preclude Landlord from modifying any Statement once such Statement is timely delivered, as provided hereinabove, to reflect any new information received by Landlord from any governmental authority or by any public utility companies with respect to the Direct Expenses shown on such Statement (including, without limitation, as a result of any new or supplemental tax bills issued by the applicable taxing authority or any audit conducted by Tenant or any other tenant of the Project), so long as Landlord delivers such revised Statement to Tenant by no later than six (6) months after Landlord receives such new information. If any such revised Statement so delivered shows that additional amounts of Tenant's Share of Direct Expenses are owed, then Tenant shall pay to Landlord, within thirty (30) days after Tenant's receipt of the revised Statement, the amount of the additional Tenant's Share of Direct Expenses.

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If any such revised Statement reflects that Tenant has overpaid Tenant's Share of Direct Expenses for such Expense Year, Landlord shall, at its option either credit such overpayment toward Tenant's next rent payment(s) under this Lease, or remit to Tenant with such applicable revised Statement the amount of the overpayment. The provisions of this <u>Section</u> <u>4.4.1</u> shall survive the expiration or earlier termination of the Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.2 **<u>Statement of Estimated Direct Expenses</u>**. In addition, Landlord shall provide Tenant a yearly expense estimate statement (the "**Estimate Statement**") which shall set forth Landlord's reasonable estimate (the "**Estimate**") of what the total amount of Direct Expenses for the then-current Expense Year shall be and the estimated Tenant's Share of Direct Expenses (the "**Estimated Direct Expenses**"), which Landlord shall use commercially reasonable efforts to deliver by April 1<sup>st</sup> of the applicable Expense Year. The failure of Landlord to timely furnish the Estimate Statement for any Expense Year shall not preclude Landlord from enforcing its rights to collect any Estimated Direct Expenses under this <u>Article 4</u>, nor shall Landlord be prohibited from revising any Estimate Statement or Estimated Direct Expenses theretofore delivered to the extent necessary. Thereafter, Tenant shall pay, within thirty (30) days after receipt of the Estimate Statement, a fraction of the Estimated Direct Expenses for the then-current Expense Year (reduced by any amounts paid pursuant to the second to last sentence of this <u>Section</u> <u>4.4.2</u>). Such fraction shall have as its numerator the number of months which have elapsed in such current Expense Year, including the month of such payment, and twelve (12) as its denominator. Until a new Estimate Statement is furnished (which Landlord shall have the right to deliver to Tenant at any time), Tenant shall pay monthly, with the monthly Base Rent installments, an amount equal to one-twelfth (1/12) of the total Estimated Direct Expenses set forth in the previous Estimate Statement delivered by Landlord to Tenant. Throughout the Lease Term, Landlord shall maintain records with respect to Direct Expenses in accordance with sound real estate management and accounting practices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 **<u>Taxes and Other Charges for Which Tenant Is Directly Responsible</u>**. Tenant shall be liable for and shall pay on or before the applicable due date, taxes levied against Tenant's equipment, furniture, fixtures and any other personal property located in or about the Project. If any such taxes on Tenant's equipment, furniture, fixtures and any other personal property are levied against Landlord or Landlord's property or if the assessed value of Landlord's property is increased by the inclusion therein of a value placed upon such equipment, furniture, fixtures or any other personal property and if Landlord pays the taxes based upon such increased assessment, which Landlord shall have the right to do regardless of the validity thereof but only under proper protest if requested by Tenant, Tenant shall upon demand repay to Landlord the taxes so levied against Landlord or the proportion of such taxes resulting from such increase in the assessment, as the case may be. If the tenant improvements in the Premises, whether installed and/or paid for by Landlord or Tenant and whether or not affixed to the real property so as to become a part thereof, are assessed for real property tax purposes at a valuation higher than the valuation at which tenant improvements conforming to Landlord's "building standard" in other space in the Building or the Project are assessed, then the Tax Expenses levied against Landlord or the property by reason of such excess assessed valuation shall be deemed to be taxes levied against personal property of Tenant and shall be governed by the provisions of <u>Section</u> <u>4.5</u>, above.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 **<u>Landlord's Records</u>**. Upon Tenant's written request given not more than ninety (90) days after Tenant's receipt of a Statement for a particular Expense Year, and provided that no Event of Default is then occurring under this Lease, Landlord shall furnish Tenant with such reasonable supporting documentation as Tenant may reasonably request in connection with the calculation of Direct Expenses as set forth in such Statement (to the extent Landlord has such supporting documentation readily available, and to the extent such supporting documentation is reasonably required to substantiate Direct Expenses charged to Tenant). Landlord shall provide said documentation to Tenant within thirty (30) days after Tenant's written request therefor (a "**Records Request**"). Within one hundred eighty (180) days after Tenant's receipt of a Statement for a particular Expense Year (the "**Audit Period**") (which Audit Period will be extended on a day for day basis for each day that Landlord fails to provide Landlord's books, records and information required to be provided by Landlord hereunder following Landlord's receipt of a timely Records Request), if Tenant disputes the calculation of Direct Expenses set forth in such Statement, an independent certified public accountant designated and paid for by Tenant ("**Tenant's Accountant**"), may after reasonable notice to Landlord and at reasonable times, audit Landlord's records with respect to the Statement, provided that (i) no Event of Default is then occurring under this Lease, and (ii) Tenant has paid all amounts required to be paid under the applicable Estimate Statement and Statement. Tenant's Accountant must (A) be a member of a nationally or regionally recognized certified public accounting firm which has previous experience in auditing financial operating records of landlords of comparable projects, (B) not already be providing accounting and/or lease administration services to Tenant or Landlord and shall not have provided accounting and/or lease administration services to Tenant or Landlord in the past three (3) years, (C) not be retained on a contingency fee basis (i.e., Tenant must be billed based on the actual time and materials that are incurred by Tenant's Accountant in the performance of the audit), and (D) not currently or within the previous twenty-four (24) month period be providing accounting and/or lease administration services to another tenant in the Project in connection with a review or audit by such other tenant of Direct Expenses. In connection with such audit, Tenant and Tenant's Accountant shall execute a commercially reasonable confidentiality agreement regarding such audit. Any audit report prepared by Tenant's Accountant shall be delivered concurrently to Landlord and Tenant within the Audit Period. Tenant's failure to audit the Direct Expenses set forth in any Statement within the Audit Period shall be deemed to be Tenant's approval of such Statement and Tenant, thereafter, waives the right or ability to audit the amounts set forth in such Statement. If after such audit, Tenant still disputes such Direct Expenses, an audit to determine the proper amount shall be made, at Tenant's expense, by an independent certified public accountant (the "**Neutral Accountant**") selected by Landlord and subject to Tenant's reasonable approval; provided that if such audit by the Neutral Accountant proves that the Direct Expenses in the subject Expense Year were overstated, then Landlord shall refund such overpayments to Tenant within thirty (30) days after such determinations and if such overstatement was by more than five percent (5%), then the cost of the Neutral Accountant and the out-of-pocket cost of Tenant's Accountant shall be paid for by Landlord. Tenant's sole right to audit Landlord's records and to contest the amount of Direct Expenses with respect to any Expense Year shall be as expressly set forth in this <u>Section</u> <u>4.6</u>, and Tenant hereby waives any and all other rights pursuant to Applicable Laws to audit such records and/or to contest the amount of Direct Expenses with respect to any Expense Year.

**5. USE OF PREMISES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 **<u>Permitted Use</u>**. Tenant shall use the Premises solely for the Permitted Use set forth in <u>Section</u> <u>7</u> of the Summary and Tenant shall not use or permit the Premises or the Project to be used for any other purpose or purposes whatsoever without the prior written consent of Landlord, which may be withheld in Landlord's sole and absolute discretion.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 **<u>Prohibited Uses</u>**. Tenant further covenants and agrees that Tenant shall not use, or suffer or permit any person or persons to use, the Premises or any part thereof for any use or purpose in violation of the laws of the United States of America, the State of California, or the ordinances, regulations or requirements of the local municipal or county governing body (or other lawful authorities having jurisdiction over the Project) including, without limitation, any such laws, ordinances, regulations or requirements relating to hazardous materials or substances, as those terms are defined by Applicable Laws now or hereafter in effect, or any Underlying Documents. Landlord shall have the right to impose reasonable and customary rule and regulations regarding the use of the Project, as reasonably deemed necessary by Landlord with respect to the orderly operation of the Project, and Tenant shall comply with such reasonable rules and regulations. Tenant shall not do or permit anything to be done in or about the Premises which will in any way damage the reputation of the Project or obstruct or interfere with the rights of other tenants or occupants of the Building, or injure or annoy them or use or allow the Premises to be used for any improper, unlawful or objectionable purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about the Premises, it being agreed, however, that the foregoing does not intend to prohibit the use of the Premises for the Permitted Use consistent with other First Class Like Science Projects, including, without limitation, customary vivarium use. Tenant shall comply with, and Tenant's rights and obligations under the Lease and Tenant's use of the Premises shall be subject and subordinate to, all recorded easements, covenants, conditions, and restrictions now or hereafter affecting the Project.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 **<u>Hazardous Materials</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1 **<u>Tenant's Obligations</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.1 **<u>Prohibitions</u>**. Tenant has fully and accurately completed Landlord's Pre-Leasing Environmental Exposure Questionnaire (the "**Environmental Questionnaire**"), which is attached as **<u>Exhibit E</u>**. Tenant agrees that except for (i) the use of general office supplies within the Premises which are of a kind typically used in normal office areas in the ordinary course of business, for use in the manner for which they were designed and only in accordance with all Environmental Laws and the highest standards prevailing in the industry for such use, and then only in such amounts as may be normal for the Permitted Use, and (ii) those chemicals or materials, and their respective quantities, specifically listed on the Environmental Questionnaire, neither Tenant nor Tenant's employees, contractors and subcontractors of any tier, entities with a contractual relationship with Tenant (not including Landlord by way of this Lease), or any entity acting as an agent or sub-agent of Tenant (collectively, "**Tenant's Agents**") will produce, use, store or generate any "Hazardous Materials," as that term is defined below, on, under or about the Premises, nor cause or permit any Hazardous Material to be brought upon, placed, stored, manufactured, generated, blended, handled, recycled, used or "Released," as that term is defined below, on, in, under or about the Premises. If any information provided to Landlord by Tenant on the Environmental Questionnaire, or otherwise relating to information concerning Hazardous Materials was knowingly false, incomplete, or misleading in any material respect when made, the same shall be deemed a default by Tenant under this Lease, without any notice or cure period therefor. Landlord's prior written consent shall be

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required to any Hazardous Materials use for the Premises not described on the initial Environmental Questionnaire, such consent to be withheld in Landlord's sole discretion (provided, that, Landlord shall be reasonable with such discretion with respect to any such new Hazardous Materials that do not present an increase in risk profile of more than a de minimis level when compared to the risk profile of existing Hazardous Materials identified on any previously approved Environmental Questionnaire). Tenant shall not install or permit any underground storage tank on the Premises. For purposes of this Lease, "**Hazardous Materials**" means all flammable explosives, petroleum and petroleum products, waste oil, radon, radioactive materials, toxic pollutants, asbestos, polychlorinated biphenyls ("**PCBs**"), medical waste, chemicals known to cause cancer or reproductive toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, including without limitation any chemical, element, compound, mixture, solution, substance, object, waste or any combination thereof, which is or may be hazardous to human health, safety or to the environment due to its radioactivity, ignitability, corrosiveness, reactivity, explosiveness, toxicity, carcinogenicity, infectiousness or other harmful or potentially harmful properties or effects, or defined as, regulated as or included in, the definition of "hazardous substances," "hazardous wastes," "hazardous materials," or "toxic substances" under any Environmental Laws. The term "Hazardous Materials" for purposes of this Lease shall also include any mold, fungus or spores, whether or not the same is defined, listed, or otherwise classified as a "hazardous material" under any Environmental Laws, if the presence of and/or Release of such mold, fungus or spores may pose a risk to human health or the environment or negatively impact the value of the Premises. For purposes of this Lease, "**Release**" or "**Released**" or "**Releases**" shall mean any release, deposit, discharge, emission, leaking, spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping, dumping, disposing, or other movement of Hazardous Materials into the environment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.2 **<u>Notices to Landlord</u>**. Tenant shall notify Landlord in writing as soon as possible but in no event later than five (5) business days after (i) the occurrence of any actual, alleged or threatened Release of any Hazardous Material in, on, under, from, about or in the vicinity of the Premises (whether past or present), regardless of the source or quantity of any such Release, or (ii) Tenant becomes aware of any regulatory actions, inquiries, inspections, investigations, directives, or any cleanup, compliance, enforcement or abatement proceedings (including any threatened or contemplated investigations or proceedings) relating to or potentially affecting the Premises, or (iii) Tenant becomes aware of any claims by any person or entity relating to any Hazardous Materials in, on, under, from, about or in the vicinity of the Premises, whether relating to damage, contribution, cost recovery, compensation, loss or injury. Collectively, the matters set forth in clauses (i), (ii) and (iii) above are hereinafter referred to as "**Hazardous Materials Claims**." Tenant shall promptly forward to Landlord copies of all orders, notices, permits, applications and other communications and reports in connection with any Hazardous Materials Claims. Additionally, Tenant shall promptly advise Landlord in writing of Tenant's discovery of any occurrence or condition on, in, under or about the Premises that could subject Tenant or Landlord to any liability, or restrictions on ownership, occupancy, transferability or use of the Premises under any "Environmental Laws," as that term is defined below. Tenant shall not enter into any legal proceeding or other action, settlement, consent decree or other compromise with respect to any Hazardous Materials Claims without first notifying Landlord of Tenant's intention to do so and affording Landlord the opportunity to join and participate, as a party if Landlord so elects, in such proceedings and in no event shall Tenant enter into any agreements which are binding on Landlord or the Premises without Landlord's prior written consent. Landlord

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shall have the right to appear at and participate in, any and all legal or other administrative proceedings concerning any Hazardous Materials Claim. For purposes of this Lease, "**Environmental Laws**" means all applicable present and future laws relating to the protection of human health, safety, wildlife or the environment, including, without limitation, (i) all requirements pertaining to reporting, licensing, permitting, investigation and/or remediation of emissions, discharges, Releases, or threatened Releases of Hazardous Materials, whether solid, liquid, or gaseous in nature, into the air, surface water, groundwater, or land, or relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of Hazardous Materials; and (ii) all requirements pertaining to the health and safety of employees or the public. Environmental Laws include, but are not limited to, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 USC § 9601, et seq., the Hazardous Materials Transportation Authorization Act of 1994, 49 USC § 5101, et seq., the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, and Hazardous and Solid Waste Amendments of 1984, 42 USC § 6901, et seq., the Federal Water Pollution Control Act, as amended by the Clean Water Act of 1977, 33 USC § 1251, et seq., the Clean Air Act of 1966, 42 USC § 7401, et seq., the Toxic Substances Control Act of 1976, 15 USC § 2601, et seq., the Safe Drinking Water Act of 1974, 42 USC §§ 300f through 300j, the Occupational Safety and Health Act of 1970, as amended, 29 USC § 651 et seq., the Oil Pollution Act of 1990, 33 USC § 2701 et seq., the Emergency Planning and Community Right-To-Know Act of 1986, 42 USC § 11001 et seq., the National Environmental Policy Act of 1969, 42 USC § 4321 et seq., the Federal Insecticide, Fungicide and Rodenticide Act of 1947, 7 USC § 136 et seq., California Carpenter-Presley-Tanner Hazardous Substance Account Act, California Health & Safety Code §§ 25300 et seq., Hazardous Materials Release Response Plans and Inventory Act, California Health & Safety Code, §§ 25500 et seq., Underground Storage of Hazardous Substances provisions, California Health & Safety Code, §§ 25280 et seq., California Hazardous Waste Control Law, California Health & Safety Code, §§ 25100 et seq., and any other state or local law counterparts, as amended, as such Applicable Laws, are in effect as of the Lease Commencement Date, or thereafter adopted, published, or promulgated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.3 **<u>Releases of Hazardous Materials</u>**. If any Release of any Hazardous Material caused by Tenant or any of Tenant's Agents in, on, under, from or about the Premises shall occur at any time during the Lease and/or if any other Hazardous Material condition exists at the Premises that was caused by Tenant or any of Tenant's Agents that requires response actions of any kind, in addition to notifying Landlord as specified above, Tenant, at its own sole cost and expense, shall (i) immediately comply with any and all reporting requirements imposed pursuant to any and all Environmental Laws, (ii) provide a written certification to Landlord indicating that Tenant has complied with all applicable reporting requirements, (iii) take any and all necessary investigation, corrective and remedial action in accordance with any and all applicable Environmental Laws, utilizing an environmental consultant approved by Landlord, all in accordance with the provisions and requirements of this <u>Section</u> <u>5.3</u>, including, without limitation, <u>Section</u> <u>5.3.4</u>, and (iv) take any such additional investigative, remedial and corrective actions as Landlord shall in its reasonable discretion deem necessary such that the Premises are remediated to the condition existing prior to such Release.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.4 **<u>Indemnification</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.4.1 **<u>In General</u>**. Without limiting in any way Tenant's obligations under any other provision of this Lease, Tenant shall be solely responsible for and shall protect, defend, indemnify and hold the Landlord Parties harmless from and against any and all Losses (including, without limitation, penalties, enforcement actions, fines, remedial actions, litigation, arbitration and administrative proceeding costs, expert and consultant fees and laboratory costs) including, without limitation, consequential damages and sums paid in settlement of claims, which arise during or after the Lease Term, whether foreseeable or unforeseeable, that arise during or after the Lease Term in whole or in part, foreseeable or unforeseeable, directly or indirectly arising out of or attributable to the presence, use, generation, manufacture, treatment, handling, refining, production, processing, storage, Release or presence of Hazardous Materials in, on, under or about the Premises by Tenant or Tenant's Agents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.4.2 **<u>Limitations</u>**. Notwithstanding anything in <u>Section</u> <u>5.3.1.4</u>, above, to the contrary, Tenant's indemnity of Landlord as set forth in <u>Section</u> <u>5.3.1.4</u>, above, shall not be applicable to claims based upon Hazardous Materials which may exist in, on or about the Premises or Project as of the Effective Date ("**Existing Hazardous Materials**") or as a result of Landlord's acts or omissions, except to the extent that Tenant's construction activities and/or Tenant's other acts or omissions (including Tenant's failure to remove, remediate or otherwise treat or "Clean-up," as that term is defined in <u>Section</u> <u>5.3.4</u>, below, the subject Existing Hazardous Materials during the tenancy of the Premises) caused or exacerbated the subject claim where the subject Existing Hazardous Materials were actually known by Tenant to exist.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.4.3 **<u>Landlord Indemnity</u>**. Under no circumstance shall Tenant be liable for, and Landlord shall indemnify, defend, protect and hold harmless Tenant and Tenant's Agents from and against, all third party losses, costs, claims, liabilities and damages (including attorneys' and consultants' fees) arising out of any Existing Hazardous Materials, or Hazardous Material Released by Landlord or any Landlord Parties. Landlord has provided Tenant with the most recent environmental reports relating to the Project in Landlord's immediate possession. The provision of such reports shall be for informational purposes only, and Landlord does not make any representation or warranty as to the correctness or completeness of any such reports.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.1.5 **<u>Compliance with Environmental Laws</u>**. Without limiting the generality of Tenant's obligation to comply with Applicable Laws as otherwise provided in this Lease, but subject to <u>Section</u> <u>5.3.1.4.2</u> above, Tenant shall, at its sole cost and expense, comply with all Environmental Laws applicable to Tenant's use, handling, storage and disposal of Hazardous Materials. Tenant shall obtain and maintain any and all necessary permits, licenses, certifications and approvals appropriate or required for the use, handling, storage, and disposal of any Hazardous Materials used, stored, generated, transported, handled, blended, or recycled by Tenant on the Premises. Landlord shall have a continuing right, without obligation, to require

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Tenant to obtain, and to review and inspect any and all such permits, licenses, certifications and approvals, together with copies of any and all Hazardous Materials management plans and programs, any and all Hazardous Materials risk management and pollution prevention programs, and any and all Hazardous Materials emergency response and employee training programs respecting Tenant's use of Hazardous Materials. Upon request of Landlord, Tenant shall deliver to Landlord a narrative description explaining the nature and scope of Tenant's activities involving Hazardous Materials and showing Tenant's compliance with all Environmental Laws and the terms of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.2 **<u>Assurance of Performance</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.2.1 **<u>Environmental Assessments In General</u>**. Landlord may, but shall not be required to, engage from time to time such contractors as Landlord determines to be appropriate to perform environmental assessments of a scope reasonably determined by Landlord (an "**Environmental Assessment**") to ensure Tenant's compliance with the requirements of this Lease with respect to Hazardous Materials.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.2.2 **<u>Costs of Environmental Assessments</u>**. All costs and expenses incurred by Landlord in connection with any such Environmental Assessment initially shall be paid by Landlord; provided that if any such Environmental Assessment shows that Tenant has failed to comply with the provisions of this <u>Section</u> <u>5.3</u>, then all of the costs and expenses of such Environmental Assessment shall be reimbursed by Tenant as Additional Rent within thirty (30) days after receipt of written demand therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.3 **<u>Tenant's Obligations upon Surrender</u>**. At the expiration or earlier termination of the Lease Term, Tenant, at Tenant's sole cost and expense, shall: (i) cause an Environmental Assessment of the Premises to be conducted in accordance with <u>Section</u> <u>15.3</u>; (ii) cause all Hazardous Materials that are not Existing Hazardous Materials (unless as and to the extent exacerbated by Tenant as provided under <u>Section</u> <u>5.3.1.4.2</u> above) and/or were not introduced by Landlord or any Landlord Parties to be removed from the Premises and disposed of in accordance with all Environmental Laws and as necessary to allow the Premises to be used for customary leasing purposes consistent with First Class Life Science Projects; and (iii) cause to be removed all containers installed or used by Tenant or Tenant's Agents to store any Hazardous Materials on the Premises, and cause to be repaired any damage to the Premises caused by such removal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.4 **<u>Clean-up</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.4.1 **<u>Environmental Reports; Clean-Up</u>**. If any written report, including any report containing results of any Environmental Assessment (an "**Environmental Report**") shall indicate (i) the presence of any Hazardous Materials as to which Tenant has a removal or remediation obligation under this <u>Section</u> <u>5.3</u>, and (ii) that as a result of same, the investigation, characterization, monitoring, assessment, repair, closure, remediation, removal, or other clean-up (the "**Clean-up**") of any Hazardous Materials is required by applicable Environmental Laws, Tenant shall immediately prepare and submit to Landlord within thirty (30) days after receipt of the Environmental Report a comprehensive plan, subject to Landlord's written approval, specifying the actions to be taken by Tenant to perform the Clean-up so that the Premises

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are restored to the conditions required by this Lease. Upon Landlord's approval of the Clean-up plan, Tenant shall, at Tenant's sole cost and expense, without limitation on any rights and remedies of Landlord under this Lease, immediately implement such plan with a consultant reasonably acceptable to Landlord and proceed to Clean-Up Hazardous Materials in accordance with all Applicable Laws and as required by such plan and this Lease. If, within thirty (30) days after receiving a copy of such Environmental Report, Tenant fails either (a) to complete such Clean-up, or (b) with respect to any Clean-up that cannot be completed within such thirty-day period, fails to proceed with diligence to prepare the Clean-up plan and complete the Clean-up as promptly as practicable, then Landlord shall have the right, but not the obligation, and without waiving any other rights under this Lease, to carry out any Clean-up recommended by the Environmental Report or required by any governmental authority having jurisdiction over the Premises, and recover all of the costs and expenses thereof from Tenant as Additional Rent, payable within ten (10) days after receipt of written demand therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.4.2 **<u>No Rent Abatement</u>**. Tenant shall continue to pay all Rent due or accruing under this Lease during any Clean-up, and shall not be entitled to any reduction, offset or deferral of any Base Rent or Additional Rent due or accruing under this Lease during any such Clean-up.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.4.3 **<u>Surrender of Premises</u>**. Tenant shall complete any Clean-up prior to surrender of the Premises upon the expiration or earlier termination of this Lease. Tenant shall obtain and deliver to Landlord a letter or other written determination from the overseeing governmental authority confirming that the Clean-up has been completed in accordance with all requirements of such governmental authority and that no further response action of any kind is required for the use of the Premises for customary leasing purposes consistent with First Class Life Science Projects ("**Closure Letter**"). Upon the expiration or earlier termination of this Lease, Tenant shall also be obligated to close all permits obtained in connection with Hazardous Materials used by Tenant or the Tenant Agent's in, on or about the Premises in accordance with Applicable Laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.4.4 **<u>Failure to Timely Clean-Up</u>**. Should any Clean-up for which Tenant is responsible not be completed, or should Tenant not receive the Closure Letter and any governmental approvals required under Environmental Laws in conjunction with such Clean-up prior to the expiration or earlier termination of this Lease, then Tenant shall be liable to Landlord as a holdover tenant (as more particularly provided in <u>Article 16</u>) until Tenant has fully complied with its obligations under this <u>Section</u> <u>5.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.5 **<u>Confidentiality</u>**. Unless compelled to do so by Applicable Law or as and to the extent required in connection with any litigation with respect to this Lease or any governmental proceeding, Tenant agrees that Tenant shall not disclose, discuss, disseminate or copy any information, data, findings, communications, conclusions and reports regarding the environmental condition of the Premises to any Person (other than Tenant's consultants, attorneys, property managers and employees that have a need to know such information), including any governmental authority, without the prior written consent of Landlord. In the event Tenant reasonably believes that disclosure is compelled by Applicable Law or otherwise in connection with any litigation with respect to this Lease or any governmental proceeding, it shall provide Landlord ten (10) days' advance notice of disclosure of confidential information so that Landlord may attempt to obtain a protective order. Tenant may additionally release such information to bona fide prospective purchasers or lenders, subject to any such parties' written agreement to be bound by the terms of this <u>Section</u> <u>5.3</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.6 **<u>Copies of Environmental Reports</u>**. Within thirty (30) days of receipt thereof, Tenant shall provide Landlord with a copy of any and all environmental assessments, audits, studies and reports regarding Tenant's activities with respect to the Premises, or ground water beneath the Land, or the environmental condition or Clean-up thereof. Tenant shall be obligated to provide Landlord with a copy of such materials without regard to whether such materials are generated by Tenant or prepared for Tenant, or how Tenant comes into possession of such materials. Such materials shall be provided by Tenant without representation or warranty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.7 **<u>Signs, Response Plans, Etc</u>**. With respect to Tenant's use, handling, storage, and/or disposal of Hazardous Materials, Tenant shall be responsible for posting on the Premises any signs required under applicable Environmental Laws. Tenant shall also complete and file any business response plans or inventories required by any Applicable Laws as a result of Tenant's use of the Premises. Tenant shall concurrently file a copy of any such business response plan or inventory with Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3.8 **<u>Survival</u>**. Each covenant, agreement, representation, warranty and indemnification made by Tenant and Landlord, as the case may be, set forth in this <u>Section</u> <u>5.3</u> shall survive the expiration or earlier termination of this Lease and shall remain effective until all of such party's respective obligations under this <u>Section</u> <u>5.3</u> have been completely performed and satisfied.

**6. SERVICES AND UTILITIES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 **<u>In General</u>**. Landlord shall provide the following services on all days (unless otherwise stated below) during the Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 Subject to limitations imposed by all governmental rules, regulations and guidelines applicable thereto, Landlord shall provide heating, ventilation and air conditioning to the Premises ("**HVAC**") 24 hours per day, 7 days per week. Tenant shall cooperate fully with Landlord at all times and abide by all regulations and requirements that Landlord may reasonably prescribe for the proper functioning and protection of the HVAC, electrical, mechanical and plumbing systems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 Landlord shall provide reasonably sufficient electricity to the Premises (including adequate electrical wiring and facilities for connection to Tenant's lighting fixtures and incidental use equipment), in the maximum aggregate of eighteen (18) watts per square foot for the Premises, provided that the connected electrical load of Tenant's lighting fixtures and the incidental use equipment does not, in the aggregate, exceed the connected electrical loads typically required at First Class Life Sciences Projects. Tenant will design Tenant's electrical system serving any equipment producing nonlinear electrical loads to accommodate such nonlinear electrical loads, including, but not limited to, oversizing neutral conductors, derating transformers and/or providing power-line filters. Engineering plans shall include a calculation of Tenant's fully connected electrical design load with and without demand factors and shall indicate the number of

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watts of unmetered and submetered loads. Tenant shall bear the cost of replacement of lamps, starters and ballasts for non-Building standard lighting fixtures within the Premises. If electricity is separately sub-metered, then Tenant shall pay to Landlord the cost of such utilities based on such submeter, and reimbursement for any penalties for usage or other surcharges imposed by any utility company. If electricity is not separately sub-metered, then the cost of electricity used by Tenant in the Premises shall be equitably allocated by Landlord on a basis consistent with commercial reasonable property management practices. Within thirty (30) days after receipt of Landlord's statement of apportionment or statement setting forth the charges payable by Tenant, Tenant shall pay to Landlord, as Additional Rent (and not as a Direct Expense), the cost of such electrical services so apportioned or so provided by Landlord. Notwithstanding anything to the contrary set forth herein, to the extent the Premises generates electricity demand on a shared resource (e.g. electricity for the central plant), the cost of such electricity shall be allocated to Tenant on a pro rata basis or other reasonable basis consistent with commercial reasonable property management practices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 Landlord shall provide city water from the regular Building outlets for drinking, kitchen, lavatory and toilet purposes in the Building Common Areas and the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.4 Landlord shall provide nonexclusive, non-attended automatic passenger elevator service during standard Building operating hours consistent with First Class Life Science Projects, and shall have one elevator available at all other times, including on the Holidays, except in the event of emergency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.5 Landlord shall not provide janitorial services for the Premises. Tenant shall be solely responsible for performing all janitorial services and other cleaning of the Premises, all in compliance with Applicable Laws. The janitorial and cleaning of the Premises shall be adequate to maintain the Premises in a manner consistent with First Class Life Sciences Projects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.6 Landlord shall provide janitorial services for the Common Areas in a manner consistent with First Class Life Sciences Projects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 **<u>Interruption of Use</u>**. Tenant agrees that Landlord shall not be liable for damages, by abatement of Rent or otherwise, for failure to furnish or delay in furnishing any service (including telephone and telecommunication services), or for any diminution in the quality or quantity thereof, (including, without limitation, where any such failure, delay or diminution is occasioned, in whole or in part, by breakage, repairs, replacements, or improvements, by any strike, lockout or other labor trouble, by inability to secure electricity, gas, water, or other fuel at the Building or Project after reasonable effort to do so, by any riot or other dangerous condition, emergency, accident or Casualty (as that term is defined in <u>Section</u> <u>11.1</u> below) whatsoever, by act or default of Tenant or other parties, or by any other cause); and such failures, delays or diminution shall never be deemed to constitute an eviction or disturbance of Tenant's use and possession of the Premises or relieve Tenant from paying Rent (except as otherwise expressly provided in <u>Section</u> <u>19.5.2</u> below) or performing any of its obligations under this Lease. Furthermore, Landlord shall not be liable under any circumstances for a loss of, or injury to, property or for injury to, or interference with, Tenant's business, including, without limitation, loss of profits, however occurring, through or in connection with or incidental to a failure to furnish any of the services or utilities as set forth in this <u>Article 6</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 **<u>Utility Information</u>**. Tenant hereby acknowledges and agrees that (i) pursuant to certain applicable laws and/or sustainability reporting requirements (collectively the "**Energy Disclosure Requirements**"), Landlord may be required to disclose factual information concerning Tenant's energy usage at the Project to certain third parties, including, without limitation, prospective purchasers, lenders and tenants of the Building and/or Landlord's consultants and/or vendors (the "**Tenant Energy Use Disclosure"**), and (ii) in connection therewith, to the extent any utilities are separately metered and paid by Tenant, Tenant shall cooperate with Landlord as necessary to submit energy and water consumption data, including total usage and total charges as they appear on Tenant's electric, gas, water, and other utility bills, in a format deemed reasonably acceptable by Landlord. Tenant hereby further (A) consents to all such Tenant Energy Use Disclosures made by Landlord, (B) acknowledges that Landlord shall not be required to notify Tenant of any Tenant Energy Use Disclosure, and (C) releases Landlord from any and all losses, costs, damages, expenses and liabilities relating to, arising out of and/or resulting from any Tenant Energy Use Disclosure made in accordance with the foregoing provisions. The terms of this <u>Section</u> <u>6.3</u> shall survive the expiration or earlier termination of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 **<u>Access</u>**. Subject to compliance with Landlord's access control procedures and Applicable Laws, and except when and where Tenant's right of access is specifically restricted or limited in this Lease, Tenant shall have the right of access to the Premises twenty-four (24) hours per day, seven (7) days per week during the Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5 **<u>Emergency Generator</u>**. Landlord and Tenant hereby acknowledge that there is an existing generator currently serving the Building and Premises ("**Emergency Generator**"), and Tenant shall have the right, at no additional cost (other than as included in Operating Expenses), to connect to the Emergency Generator for up to Tenant's Share of the electrical capacity provided by such Emergency Generator during the Lease Term, as extended by the Option Term as applicable. Tenant's use of the Emergency Generator shall be at Tenant's sole risk, and Tenant acknowledges that neither Landlord nor any agent of Landlord has made any representation or warranty regarding the Emergency Generator. Except to the extent caused by the negligence or willful misconduct of Landlord, or any Landlord Parties, Tenant hereby waives any claims against Landlord or any Landlord Parties resulting from Tenant's use of the Emergency Generator, or any failure of the Emergency Generator to operate as designed, and agrees that Landlord shall not be liable for any damages resulting from any failure in operation of the Emergency Generator, including, without limitation any injury or damage to, or interference with, Tenant's business, including but not limited to, loss of profits, loss of rents or other revenues, loss of business opportunity, loss of goodwill or loss of use, or loss to equipment, inventory, scientific research, scientific experiments, laboratory animals, products, specimens, samples, and/or scientific, business, accounting and other records of every kind and description kept at the Premises and any and all income derived or derivable therefrom. Tenant acknowledges that Operating Expenses shall include Landlord's costs incurred in maintaining and operating the Emergency Generator (including all permit costs and fees), but shall not include any Hazardous Materials remediation costs incurred in connection with the Generator. During the Term, Landlord shall maintain a maintenance and service contract for the Emergency Generator with service visits not less than twice annually.

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**7. REPAIRS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 **<u>Tenant Repair Obligations</u>**. Tenant shall, at Tenant's own expense, keep the Premises, including all improvements, fixtures and furnishings therein, and the floor or floors of the Building on which the Premises are located, in good order, repair and condition at all times during the Lease Term. In addition, Tenant shall, at Tenant's own expense, but under the supervision and subject to the prior approval of Landlord, and within any reasonable period of time specified by Landlord, promptly and adequately repair all damage to the Premises and replace or repair all damaged, broken, or worn fixtures and appurtenances, except for damage caused by ordinary wear and tear or beyond the reasonable control of Tenant or damage by casualty; provided however, that, Landlord shall have the exclusive right, at Landlord's option, but not the obligation, to make such repairs and replacements, and Tenant shall pay to Landlord the actual, reasonable out-of-pocket costs incurred by Landlord in performing such work, plus a five percent (5%) supervision fee within thirty (30) days after Tenant's receipt of invoices therefor. Landlord may, but shall not be required to, enter the Premises pursuant to the terms of <u>Article 27</u>, below, to make such repairs, alterations, improvements or additions to the Premises or to the Project or to any equipment located in the Project as Landlord shall desire or deem necessary or as Landlord may be required to do by governmental or quasi-governmental authority or court order or decree. In exercising Landlord's rights under this <u>Section</u> <u>7.1</u>, Landlord shall use commercially reasonable efforts to not unreasonably interfere with Tenant's access to and/or use of the Premises for the Permitted Use. Tenant hereby waives any and all rights under and benefits of subsection 1 of Section 1932 and Sections 1941 and 1942 of the California Civil Code or under any similar law, statute, or ordinance now or hereafter in effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 **<u>Landlord Repair Obligations</u>**. Notwithstanding the foregoing, Landlord shall be responsible for repairs and replacement as necessary to the exterior walls, exterior doors and windows and waterproofing of the Building envelope, foundation and roof (including roof membrane, gutters, flashings, and downspouts) of the Building, utility connections to the Building, the structural portions of the floors of the Building (the "**Building Structure**"), the base Building plumbing, sewer, drainage, electrical, fire protection, elevator, life safety, shared laboratory systems (if any), heating, ventilation and air-conditioning systems (the "**Building Systems**" and together with the Building Structure, the "**Base Building**") of the Building to keep the same in good working order and condition, and the Common Areas, except to the extent that such repairs are required due to the negligence or willful misconduct of Tenant; provided, however, that if such repairs are due to the negligence or willful misconduct of Tenant, Landlord shall nevertheless make such repairs at Tenant's expense, or, if covered by Landlord's insurance, Tenant shall only be obligated to pay any deductible in connection therewith. Subject to the terms of <u>Article 27</u>, below, Landlord may, but shall not be required to, enter the Premises at all reasonable times and upon reasonable prior notice to make such repairs, alterations, improvements or additions to the Premises or to the Project or to any equipment located in the Project as Landlord shall desire or deem necessary or as Landlord may be required to do by governmental or quasi-governmental authority or court order or decree. In exercising Landlord's rights under this <u>Section</u> <u>7.2</u>, Landlord shall use commercially reasonable efforts to not unreasonably interfere with Tenant's access to and/or use of the Premises for the Permitted Use. Tenant hereby waives any and all rights under and benefits of subsection 1 of Section 1932 and Sections 1941 and 1942 of the California Civil Code or under any similar law, statute, or ordinance now or hereafter in effect.

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**8. ADDITIONS AND ALTERATIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 **<u>Landlord's Consent to Alterations</u>**. Tenant may not make any repairs, improvements, alterations, additions or changes to the Premises or other portion of the Project, or any mechanical, plumbing or HVAC facilities or systems pertaining to the Premises or Project (collectively, the "**Alterations**") without the prior written consent of Landlord to such Alterations, which consent shall be requested by Tenant not less than thirty (30) days prior to the commencement thereof, and which consent shall not be unreasonably withheld or conditioned by Landlord, provided it shall be deemed reasonable for Landlord to withhold its consent to any Alteration which adversely affects the structural portions or the systems or equipment of the Building or is visible from the exterior of the Building / may (a) affect the exterior appearance of the Building; (b) affect the Building structure or adversely affect the Building Systems; (c) fail to comply with Applicable Laws or cause any other portion of the Project to fail to comply with Applicable Laws; (d) be in conflict with Landlord's Sustainability Initiative (including, without limitation, by jeopardizing any Green Certification); (e) vitiate or otherwise negatively affect any warranty, guaranty, or insurance maintained by Landlord; (f) materially increase Landlord's Repair Obligations; (g) obstructs or interferes with other tenants or occupants of the Project, or (h) be unusually difficult or expensive to remove or not be readily usable for a future tenant. Landlord shall notify Tenant of its consent or disapproval of any such proposed Alterations within ten (10) business days after Landlord's receipt of Tenant's request therefor, together with all final plans and specifications for such work. Notwithstanding the foregoing, Tenant shall be permitted to make Alterations following ten (10) business days' notice to Landlord, but without Landlord's prior consent, to the extent that such Alterations (i) do not affect the Building Systems or any Building equipment, (ii) are not visible from the exterior of the Building, and (iii) cost less than $100,000.00 for a particular job of work ("**Cosmetic Alterations**"). The construction of the initial improvements to the Premises shall be governed by the terms of the Tenant Work Letter and not the terms of this <u>Article 8</u> (provided, however, that such initial improvements shall be deemed to constitute Alterations for purposes of <u>Sections 8.5</u> below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 **<u>Manner of Construction</u>**. Landlord may impose, as a condition to Tenant's right to perform any Alterations, such requirements as Landlord in its reasonable discretion may deem desirable, including, but not limited to, the requirement that upon Landlord's request, Tenant shall, at Tenant's expense, remove such Alterations upon the expiration or any early termination of the Lease Term / the requirement that (i) Tenant utilize for such purposes only contractors designated or reasonably approved by Landlord, (ii) Tenant enter into a construction contract that includes Landlord's then-standard reasonable construction rider (or such other construction rider as Landlord may reasonably require), which rider shall include, among other things, Landlord's insurance and indemnity requirements, and (iii) any "Lines" (as that term is defined in <u>Section</u> <u>22</u> below), including riser cables, installed by Tenant shall be (x) appropriately insulated to prevent excessive electromagnetic fields or radiation, (y) surrounded by a protective conduit reasonably acceptable to Landlord, and (z) identified in accordance with Landlord's Building standard requirements; provided, that, Tenant shall have no obligation upon the expiration or earlier termination of this Lease to remove any initial Tenant Improvements depicted on the Approved Space Plan attached to the Tenant Work Letter. Tenant shall be solely responsible for acquiring any required permit for all Alterations, furnishing of a copy of such permit and approvals to Landlord prior to the commencement of the work, and complying with all conditions of said permit in a prompt and expeditious manner. If such Alterations will involve the use of or disturb

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Hazardous Materials, Tenant shall notify Landlord prior to performing such Alterations and comply with Landlord's rules and regulations concerning such Hazardous Materials. Tenant shall construct such Alterations and perform such repairs in a good and workmanlike manner, in conformance with any and all Applicable Laws. Tenant shall not use (and upon notice from Landlord shall cease using) contractors, services, workmen, labor, materials or equipment that, in Landlord's reasonable judgment, would disturb labor harmony with the workforce or trades engaged in performing other work, labor or services in or about the Project. In addition to Tenant's obligations under <u>Article 9</u> of this Lease, upon completion of any Alterations, Tenant shall cause a Notice of Completion to be recorded in the office of the Recorder of the county in which the Project is located in accordance with Section 8182 of the Civil Code of the State of California or any successor statute. Tenant shall, promptly following the completion of any Alterations (including any Cosmetic Alterations), compile and deliver to Landlord a "close-out package" in such format designated by Landlord (e.g., paper and/or electronic files) containing, without limitation, the following items (to the extent deemed necessary by Landlord for the particular Alterations): (a) as-built drawings and final record CAD drawings, (b) warranties and guarantees from all contractors, subcontractors and material suppliers, (c) all permits, approvals and other documents issued by any governmental agency in connection with the Alterations, (d) an independent air balance report, if required due to the nature of the Alterations, (e) lien releases for all work performed at the Project, and (f) such other information or materials as may be reasonably requested by Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 **<u>Payment for Improvements</u>**. Tenant is responsible for all of the costs in performance any Alterations. In addition, in connection with all Alterations, Tenant shall pay to Landlord an oversight fee equal to three percent (3%) of the cost of the Alterations. Tenant shall also reimburse Landlord for Landlord's reasonable, out- of-pocket costs and expenses actually incurred in connection with Landlord's review of such Alterations (including, but not limited to, fees paid to consultants retained by Landlord to review plans and specifications for such Alterations).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 **<u>Construction Insurance</u>**. In addition to the requirements of <u>Article 10</u> of this Lease, in the event that Tenant makes any Alterations, prior to the commencement of such Alterations, Tenant shall provide Landlord with evidence that Tenant carries "**Builder's Risk**" insurance in an amount reasonably approved by Landlord covering the construction of such Alterations, and such other insurance as Landlord may reasonably require, it being understood and agreed that all of such Alterations shall be insured by Tenant pursuant to <u>Article 10</u> of this Lease immediately upon completion thereof. In addition, Tenant's contractors and subcontractors shall be required to carry (i) Commercial General Liability Insurance in an amount approved by Landlord, with Landlord, and, at Landlord's option, Landlord's property manager and project manager, as additional insureds in an amount approved by Landlord, and otherwise in accordance with the requirements of <u>Article 10</u> of this Lease, and (ii) workers compensation insurance with a waiver of subrogation in favor of Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.5 **<u>Landlord's Property</u>**. All Alterations, improvements, fixtures, equipment and/or appurtenances which may be installed or placed in or about the Premises, from time to time, shall be at the sole cost of Tenant and to the extent affixed to the Premises, upon the expiration or earlier termination of this Lease, shall be and become the property of Landlord and remain in place at the Premises following the expiration or earlier termination of this Lease. Notwithstanding the

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foregoing, Landlord may, by written notice to Tenant prior to the end of the Lease Term, or given following any earlier termination of this Lease, require Tenant, at Tenant's expense, to remove any Alterations and/or improvements and/or systems and equipment within the Premises ("**Removal Items**") and to repair any damage to the Premises and Building caused by such removal and return the affected portion of the Premises to a building standard tenant improved condition as determined by Landlord; provided, however, with respect to Alterations made or caused to be made by Tenant with Landlord's consent, Tenant shall have no obligation to remove such Alterations unless at the time Landlord approved the final working drawings for any Alterations, Landlord, by written notice to Tenant, identified those Alterations which Landlord would require Tenant to remove at the expiration or earlier termination of this Lease, in which event Tenant shall remove such identified Alterations on or before the expiration of the Lease Term and repair any damage resulting from such removal. If Tenant fails to complete such removal and/or to repair any damage caused by the removal of any Alterations and/or improvements and/or systems and equipment in the Premises and return the affected portion of the Premises to a building standard tenant improved condition as reasonably determined by Landlord, Landlord may do so and may charge the cost thereof to Tenant. Tenant hereby protects, defends, indemnifies and holds Landlord harmless from any liability, cost, obligation, expense or claim of lien in any manner relating to the installation, placement, removal or financing of any such Alterations, improvements, fixtures and/or equipment in, on or about the Premises, which obligations of Tenant shall survive the expiration or earlier termination of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.6 **<u>Labor Harmony</u>**. Tenant shall not use (and upon notice from Landlord shall cease using) contractors, subcontractors, services, workmen, labor, materials or equipment that, in Landlord's reasonable judgment, would disturb labor harmony with the workforce or trades engaged in performing other work, labor or services in or about the Project, Building or the Common Areas and/or that otherwise results in picketing or other labor disturbances at the Project and/or on property adjacent thereto.

**9. COVENANT AGAINST LIENS**. Tenant shall keep the Project and Premises free from any liens or encumbrances arising out of the work performed, materials furnished or obligations incurred by or on behalf of Tenant, and shall protect, defend, indemnify and hold Landlord harmless from and against any "Losses" (as defined in <u>Section</u> <u>10.1</u> below) arising out of same or in connection therewith. Tenant shall give Landlord notice at least twenty (20) days prior to the commencement of any such work on the Premises (or such additional time as may be necessary under Applicable Laws) to afford Landlord the opportunity of posting and recording appropriate notices of non-responsibility (and Tenant shall, upon demand, reimburse Landlord for the costs and expenses incurred by Landlord in connection with preparing and recording any such notices of non-responsibility). Tenant shall remove any such lien or encumbrance by bond or otherwise within ten (10) business days after notice by Landlord, and if Tenant shall fail to do so, Landlord may pay the amount necessary to remove such lien or encumbrance, without being responsible for investigating the validity thereof. The amount so paid shall be deemed Additional Rent under this Lease payable upon demand (or, at Landlord's election, Landlord may deduct such amounts from any undisbursed improvement allowance or other allowance granted to Tenant under this Lease), without limitation as to other remedies available to Landlord under this Lease. Nothing contained in this Lease shall authorize Tenant to do any act which shall subject Landlord's title to the Building or Premises to any liens or encumbrances whether claimed by operation of law or express or implied contract. Any claim to a lien or encumbrance upon the Building or Premises arising in connection with any such work or respecting the Premises not performed by or at the request of Landlord shall be null and void, or at Landlord's option shall attach only against Tenant's interest in the Premises and shall in all respects be subordinate to Landlord's title to the Project, Building and Premises.

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**10. INSURANCE** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1 **<u>Indemnification and Waiver</u>**. Subject to the provisions set forth below in this <u>Section</u> <u>10.1</u>: (i) Tenant hereby assumes all risk of damage to property or injury to persons in, upon or about the Premises from any cause whatsoever and agrees that Landlord, its partners, subpartners and their respective officers, agents, servants, employees, lenders, any property manager and independent contractors (collectively, "**Landlord Parties**") shall not be liable for, and are hereby released from any responsibility for, any damage either to person or property or resulting from the loss of use thereof, which damage is sustained by Tenant or by other persons claiming through Tenant; and (ii) Tenant shall indemnify, defend, protect, and hold harmless the Landlord Parties from and against any and all claims, losses, costs, damages, expenses, causes of action, proceedings, and liability (including without limitation court costs and reasonable attorneys' fees) (collectively, "**Losses**") incurred in connection with or arising from: (A) any causes in, on or about the Premises; (B) any acts, omissions or negligence of Tenant or of any person claiming under Tenant, its Transferees, or the contractors, agents, servants, employees, invitees, visitors, guests or licensees of Tenant or its Transferees or any such person, in, on or about the Project (collectively, "**Tenant Parties**"); and/or (C) any breach, violation or non-performance by Tenant or Tenant Parties of any term, covenant or provision of this Lease or any Applicable Laws. Notwithstanding the foregoing provisions of this <u>Section</u> <u>10.1</u> to the contrary: (1) the assumption of risk and release by Tenant set forth in clause (i) hereinabove shall not apply to any Losses to the extent resulting from the gross negligence or willful misconduct of Landlord or Landlord's agents, employees or contractors (collectively, the "**Excluded Claims**") (provided, that, for purposes of clarification, Landlord shall never be liable for lost profits, loss of business or other consequential damages [collectively, "**Consequential Damages**"] incurred or suffered by Tenant or Tenant's contractors, agents, employees, licensees or invitees); and (2) Tenant's indemnity of Landlord set forth in clause (ii) hereinabove shall not apply to (y) any Excluded Claims, or (z) any loss of or damage to Landlord's property to the extent Landlord has waived such loss or damage pursuant to <u>Section</u> <u>10.5</u> below. In addition, Landlord shall indemnify, defend, protect and hold Tenant and Tenant's officers, directors, agents, and employees harmless from and against all such Excluded Claims, except for (I) any loss or damage to Tenant's property to the extent Tenant has waived such loss or damage pursuant to <u>Section</u> <u>10.5</u> below, and (II) any Consequential Damages. Each party's agreement to indemnify the other pursuant to this <u>Section</u> <u>10.1</u> is not intended to and shall not relieve any insurance carrier of its obligations under policies required to be carried by Tenant and/or Landlord, as applicable, pursuant to the provisions of this Lease. The provisions of this <u>Section</u> <u>10.1</u> shall survive the expiration or earlier termination of this Lease with respect to any Losses arising in connection with any event occurring prior to such expiration or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2 **<u>Tenant's Compliance With Landlord's Property Insurance</u>**. Landlord shall insure the Building during the Lease Term against loss or damage under an "all risk" property insurance policy. Such coverage shall be in such amounts, from such companies, and on such other terms and conditions, as Landlord may from time to time reasonably determine, but in no event

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less than the full replacement cost thereof (excluding any items required to be insured by Tenant under <u>Section</u> <u>10.3.2</u> below). Additionally, at the option of Landlord, such insurance coverage may include the risks of earthquakes and/or flood damage and additional hazards, a rental loss endorsement and one or more loss payee endorsements in favor of the holders of any mortgages or deeds of trust encumbering the interest of Landlord in the Building or the ground or underlying lessors of the Building, or any portion thereof. Tenant shall, at Tenant's expense, comply with all insurance company requirements pertaining to the use of the Premises. If Tenant's conduct or use of the Premises causes any increase in the premium for such insurance policies then Tenant shall reimburse Landlord for any such increase. Tenant, at Tenant's expense, shall comply with all rules, orders, regulations or requirements of the American Insurance Association (formerly the National Board of Fire Underwriters) and with any similar body. Tenant shall also provide Landlord and Landlord's insurer(s) with such information regarding the use of the Premises and any damage to the Premises as they may require in connection with the placement of insurance for the Premises or the adjusting of any losses to the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3 **<u>Tenant's Insurance</u>**. Tenant shall maintain the following coverages in the following amounts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.1 Commercial General Liability Insurance on an occurrence form covering the insured against claims of bodily injury, personal injury and property damage (including loss of use thereof) arising out of Tenant's operations, and contractual liabilities including a contractual coverage, and including products and completed operations coverage, for limits of liability on a per location basis of not less than:

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| | |
|:---|:---|
|  Bodily Injury and<br> Property Damage Liability | $5,000,000 each occurrence<br> $5,000,000 annual aggregate |
|  Personal Injury Liability | $3,000,000 each occurrence<br> $3,000,000 annual aggregate |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.2 Property Insurance covering (i) all office furniture, business and trade fixtures, office equipment, free-standing cabinet work, movable partitions, merchandise and all other items of Tenant's property on the Premises installed by, for, or at the expense of Tenant, (ii) the "**Tenant Improvements**," as that term is defined in the Tenant Work Letter, and any other improvements which exist in the Premises as of the Delivery Date, including Landlord's Delivery Work (excluding the Base Building) (the "**Original Improvements**"), and (iii) all other improvements, alterations and additions made to the Premises. Such insurance shall be written on an "**all risks**" of physical loss or damage basis, for the full replacement cost value (subject to reasonable deductible amounts) new without deduction for depreciation of the covered items and in amounts that meet any co-insurance clauses of the policies of insurance and shall include coverage for damage or other loss caused by fire or other peril including, but not limited to, vandalism and malicious mischief, theft, water damage of any type, including sprinkler leakage, bursting or stoppage of pipes, and explosion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.3 Business Income Interruption for one (1) year plus Extra Expense insurance in such amounts as will reimburse Tenant for actual direct or indirect loss of earnings attributable to the risks outlined in <u>Section</u> <u>10.3.2</u> above.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.4 Worker's Compensation and Employer's Liability or other similar insurance pursuant to all applicable state and local statutes and regulations. The policy shall include a waiver of subrogation in favor of Landlord, its employees, Lenders and any property manager or partners.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4 **<u>Form of Policies</u>**. The minimum limits of policies of insurance required of Tenant under this Lease shall in no event limit the liability of Tenant under this Lease. Such insurance shall (i) name Landlord, its subsidiaries and affiliates, its property manager (if any) and any other party the Landlord so specifies, as an additional insured or loss payee, as applicable, including Landlord's managing agent, if any; (ii) be issued by an insurance company having a rating of not less than A: IX in Best's Insurance Guide or which is otherwise acceptable to Landlord and licensed to do business in the State of California; (iv) be primary insurance as to all claims thereunder and provide that any insurance carried by Landlord is excess and is non-contributing with any insurance required of Tenant; (v) be in form and content reasonably acceptable to Landlord; and (vi) provide that said insurance shall not be canceled or coverage changed unless thirty (30) days' prior written notice shall have been given to Landlord and any mortgagee of Landlord (unless such cancellation is the result of non-payment of premiums). Tenant shall deliver said policy or policies or certificates thereof to Landlord on or before the Lease Commencement Date (or any earlier Delivery Date) and at least ten (10) days before the expiration dates thereof. In the event Tenant shall fail to procure such insurance, or to deliver such policies or certificate, Landlord may, at its option, procure such policies for the account of Tenant, and the cost thereof shall be paid to Landlord within five (5) days after delivery to Tenant of bills therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5 **<u>Subrogation</u>**. Landlord and Tenant intend that their respective property loss risks shall be borne by their insurance carriers, and Landlord and Tenant hereby agree to look solely to, and seek recovery only from, their respective insurance carriers in the event of a property or business interruption loss to the extent that such coverage is agreed to be provided hereunder. The parties each hereby waive all rights and claims against each other for such losses, and waive all rights of subrogation of their respective insurers, provided such waiver of subrogation shall not affect the right to the insured to recover thereunder. The parties agree that their respective insurance policies do now, or shall, contain the waiver of subrogation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6 **<u>Additional Insurance Obligations</u>**. Tenant shall carry and maintain during the entire Lease Term, at Tenant's sole cost and expense, increased amounts of the insurance required to be carried by Tenant pursuant to this <u>Article 10</u> and such other reasonable types of insurance coverage and in such reasonable amounts covering the Premises and Tenant's operations therein, as may be reasonably requested by Landlord or Landlord's lender, but in no event in excess of the amounts and types of insurance then being required by landlords of buildings comparable to and in the vicinity of the Building. In addition, Tenant shall pay for any increase in the premiums for the property insurance of the Project carried by Landlord if said increase is caused by Tenant's use or occupancy of the Premises.

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**11. DAMAGE AND DESTRUCTION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1 **<u>Repair of Damage</u>**. Tenant shall promptly notify Landlord of any damage to the Premises resulting from fire or any other casualty ("**Casualty**"). If the Premises or any Common Areas or other portions of the Project serving or providing access to the Premises shall be damaged by Casualty, Landlord shall promptly and diligently, subject to reasonable delays for insurance adjustment or other matters beyond Landlord's reasonable control, and subject to all other terms of this <u>Article 11</u>, restore the applicable components of the Premises, the Base Building and such Common Areas and portions of the Project. Such restoration shall be to substantially the same condition of the applicable components of the Premises, the Base Building and the Common Areas and Project prior to the Casualty, except for modifications required by zoning and building codes and other laws or by the holder of a mortgage on the Building or Project or any other modifications to the Common Areas deemed desirable by Landlord, which are consistent with the character of the Project, provided that access to the Premises shall not be materially impaired. In connection with the repairs to be performed by Landlord pursuant to <u>Section</u> <u>11.2</u> below, Tenant shall cooperate with requests for information regarding any repairs from Landlord's insurer(s) by providing the requested information within ten (10) business days after Tenant receives the request. Landlord shall not be liable for any inconvenience or annoyance to Tenant or its visitors, or injury to Tenant's business resulting in any way from such damage or the repair thereof; provided however, that if such Casualty shall have damaged the Premises or Common Areas or portions of the Project necessary to Tenant's occupancy, and the Premises are not occupied by Tenant as a result thereof, then during the time and to the extent the Premises are unfit for occupancy, the Rent shall be abated in proportion to the ratio that the amount of rentable square feet of the Premises which is unfit for occupancy for the purposes permitted under this Lease bears to the total rentable square feet of the Premises. Notwithstanding any contrary provision of this <u>Article 11</u>, the parties hereby agree as follows: (i) the closure of the Project, the Building, the Common Areas, or any part thereof to protect public health shall not constitute a Casualty for purposes of this Lease, (ii) Casualty covered by this <u>Article 11</u> shall require that the physical or structural integrity of the Premises, the Project, the Building, or the Common Areas is degraded as a direct result of such occurrence, and (iii) a Casualty under this <u>Article 11</u> shall not be deemed to occur merely because Tenant is unable to productively use the Premises in the event that the physical and structural integrity of the Premises is undamaged.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2 **<u>Landlord's Option to Repair</u>**. Within sixty (60) days after Landlord becomes aware of such damage, Landlord shall deliver a notice (the "**Landlord Repair Notice**") to Tenant of the estimated time, in Landlord's reasonable judgment, required to substantially complete the work Landlord is required to perform pursuant to <u>Section</u> <u>11.1</u> above and this <u>Section</u> <u>11.2</u> (the "**Landlord's Restoration Work**"), and upon receipt of a Landlord Repair Notice Tenant shall assign to Landlord (or to any party designated by Landlord) all insurance proceeds payable to Tenant under Tenant's insurance required under <u>Section</u> <u>10.3</u> of this Lease, and Landlord shall repair any injury or damage to the Tenant Improvements and the Original Improvements installed in the Premises and shall return such Tenant Improvements and Original Improvements to their original condition; provided that if the cost of such repair by Landlord (for the Tenant Improvements and Original Improvements, but not including any components of the Base Building and/or other items that Landlord is responsible for the maintenance and repair of under Section 7.2 above) exceeds the applicable amount of insurance proceeds received by Landlord from Tenant's insurance carrier (including by taking into account any deductible or self-insured retention), as assigned by Tenant, or from Landlord's own insurance carrier (if any) for such scope of repairs (a "**Shortfall Amount**"), the Shortfall Amount shall be paid by Tenant to Landlord prior to Landlord's commencement of repair of the damage; provided, that, Landlord shall competitively bid such repair work to at least three (3) general contractors; provided, further, that, so long as Tenant has maintained the required property damage insurance under this Lease, at Tenant's

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election by written notice to Landlord, in the event of any such Shortfall Amount, Landlord will only be required to restore the tenant improvements to the extent of such insurance proceeds (which may require a modified and reduced scope of restored tenant improvements therein). Notwithstanding the terms of <u>Section</u> <u>11.1</u> of this Lease, Landlord may elect not to rebuild and/or restore the Premises, Building and/or Project, and instead terminate this Lease, by notifying Tenant in writing of such termination within sixty (60) days after the date of discovery of the damage, such notice to include a termination date giving Tenant sixty (60) days to vacate the Premises, but Landlord may so elect only if the Building or Project shall be damaged by Casualty, whether or not the Premises are affected, and one or more of the following conditions is present: (i) in Landlord's reasonable judgment, Landlord's Restoration Work cannot reasonably be completed within two hundred seventy (270) days after the date of discovery of the damage (when such repairs are made without the payment of overtime or other premiums); (ii) the holder of any mortgage on the Building or Project or ground lessor with respect to the Building or Project shall require that the insurance proceeds or any portion thereof be used to retire the mortgage debt, or shall terminate the ground lease, as the case may be; (iii) the damage is due to a risk that Landlord is not required to insure under this Lease; (iv) the damage occurs during the last twelve (12) months of the Lease Term and restoration will require more than sixty (60) days or the remainder of the Lease Term (whichever is less) to complete; provided, however, that if Landlord does not elect to terminate this Lease pursuant to Landlord's termination right as provided above (which shall be communicated in the Landlord Repair Notice), and the repairs cannot, in the reasonable opinion of Landlord (which shall be communicated in the Landlord Repair Notice), be completed within two hundred seventy (270) days after the date of discovery of the damage, Tenant may elect, no earlier than sixty (60) days nor later than ninety (90) days after the date of discovery of such damage, to terminate this Lease by written notice to Landlord effective as of the date specified in the notice, which date shall not be less than thirty (30) days nor more than sixty (60) days after the date such notice is given by Tenant. Notwithstanding the provisions of this <u>Section</u> <u>11.2</u>, Tenant shall have the right to terminate this Lease under this <u>Section</u> <u>11.2</u> only if each of the following conditions is satisfied (collectively, the "**Tenant Casualty Conditions**"): (a) the damage to the Project by Casualty was not caused by the gross negligence or intentional act of Tenant or its partners or subpartners and their respective officers, agents, servants, employees, and independent contractors; (b) as a result of the damage, Tenant cannot reasonably conduct business from twenty-five percent (25%) or more of the Premises; and (c) as a result of the damage to the Project, Tenant does not occupy or use the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3 **<u>Inability to Complete</u>**. Notwithstanding anything to the contrary contained in this Article 11, if the Tenant Casualty Conditions are satisfied and Landlord is obligated or elects to perform Landlord's Restoration Work under <u>Section</u> <u>11.1</u> above, but is delayed in substantially completing the same on or before the date (the "**<u>Outside Restoration Date</u>**<u>"</u>) that is the later of (i) sixty (60) days after the date estimated by Landlord in Landlord's Repair Notice for substantial completion of Landlord's Restoration Work, and (ii) two hundred seventy (270) days after the date of such damage (which Outside Restoration Date shall be extended day for day for each day Landlord is delayed in substantially completing Landlord's Restoration Work as a result of any delays due to Force Majeure events and delays caused by Tenant and/or Tenant's agents, contractors, employees, licensees and/or invitees), then Tenant shall have the right to terminate this Lease exercisable by written notice (the "**<u>Damage Termination Notice</u>")** at any time after the Outside Restoration Date but prior to substantial completion of the Landlord's Restoration Work, which termination shall be effective as of the date (the "**<u>Damage Termination Date</u>"**) of the

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Damage Termination Notice. Notwithstanding the foregoing, if Tenant delivers a Damage Termination Notice to Landlord, then Landlord shall have the right to suspend the occurrence of the Damage Termination Date for a period ending thirty (30) days after the Damage Termination Date by delivering to Tenant, within three (3) business days after Landlord's receipt of the Damage Termination Notice, a certificate of Landlord's contractor responsible for Landlord's Restoration Work certifying that it is such contractor's good faith judgment that Landlord's Restoration Work will be substantially completed within thirty (30) days after the Damage Termination Date. If Landlord's Restoration Work is substantially completed prior to the expiration of such thirty (30)-day period, then the Damage Termination Notice shall be of no force or effect, but if Landlord's Restoration Work is not substantially completed within such thirty-day period, then this Lease shall terminate upon the expiration of such thirty (30)-day period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4 **<u>Waiver of Statutory Provisions</u>**. The provisions of this Lease, including this <u>Article 11</u>, constitute an express agreement between Landlord and Tenant with respect to any and all damage to, or destruction of, all or any part of the Premises, the Building or the Project, and any statute or regulation of the State of California, including, without limitation, Sections 1932(2) and 1933(4) of the California Civil Code, with respect to any rights or obligations concerning damage or destruction in the absence of an express agreement between the parties, and any other statute or regulation, now or hereafter in effect, shall have no application to this Lease or any damage or destruction to all or any part of the Premises, the Building or the Project.

**12. NONWAIVER**. No provision of this Lease shall be deemed waived by either party hereto unless expressly waived in a writing signed by the waiving party. The waiver by either party hereto of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of any subsequent breach of same or any other term, covenant or condition herein contained. The subsequent acceptance of Rent hereunder by Landlord shall not be deemed to be a waiver of any preceding breach by Tenant of any term, covenant or condition of this Lease, other than the failure of Tenant to pay the particular Rent so accepted, regardless of Landlord's knowledge of such preceding breach at the time of acceptance of such Rent. No acceptance of a lesser amount than the Rent herein stipulated shall be deemed a waiver of Landlord's right to receive the full amount due, nor shall any endorsement or statement on any check or payment or any letter accompanying such check or payment be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the full amount due. No receipt of monies by Landlord from Tenant after the termination of this Lease shall in any way alter the length of the Lease Term or of Tenant's right of possession hereunder, or after the giving of any notice shall reinstate, continue or extend the Lease Term or affect any notice given Tenant prior to the receipt of such monies, it being agreed that after the service of notice or the commencement of a suit, or after final judgment for possession of the Premises, Landlord may receive and collect any Rent due, and the payment of said Rent shall not waive or affect said notice, suit or judgment.

**13. CONDEMNATION.** If the whole or any part of the Premises, Building or Project shall be taken by power of eminent domain or condemned by any competent authority for any public or quasi-public use or purpose, or if any adjacent property or street shall be so taken or condemned, or reconfigured or vacated by such authority in such manner as to require the use, reconstruction or remodeling of any part of the Premises, Building or Project, or if Landlord shall grant a deed or other instrument in lieu of such taking by eminent domain or condemnation (each, a "**Taking**"),

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Landlord shall have the option to terminate this Lease effective as of the date possession is required to be surrendered to the authority. Tenant shall not because of such taking assert any claim against Landlord or the authority for any compensation because of such taking and Landlord shall be entitled to the entire award or payment in connection therewith, except that Tenant shall have the right to file any separate claim available to Tenant for any taking of Tenant's personal property and fixtures belonging to Tenant and removable by Tenant upon expiration of the Lease Term pursuant to the terms of this Lease, and for moving expenses, so long as such claims do not diminish the award available to Landlord, its ground lessor with respect to the Building or Project or its mortgagee, and such claim is payable separately to Tenant. All Rent shall be apportioned as of the date of such termination. If any part of the Premises shall be taken, and this Lease is not terminated, the Rent under this Lease shall be proportionately reduced based on the portion of the Premises subject to the applicable taking. Tenant hereby waives any and all rights it might otherwise have pursuant to Section 1265.130 of the California Code of Civil Procedure. Notwithstanding anything to the contrary contained in this <u>Article 13</u>, in the event of a temporary taking of all or any portion of the Premises for a period of ninety (90) days or less, then this Lease shall not terminate but the Base Rent and Tenant's Share of Direct Expenses shall be abated for the period of such taking in proportion to the ratio that the amount of rentable square feet of the Premises taken bears to the total rentable square feet of the Premises. Landlord shall be entitled to receive the entire award made in connection with any such temporary taking. Notwithstanding any contrary provision of this Lease, the following governmental actions (whether through regulatory action, ordinance, or otherwise) shall not constitute a taking or condemnation, either permanent or temporary: (i) an action that requires Tenant's business to close during the Lease Term, (ii) an action that limits or temporarily prohibits access to or use of the Building or Premises, and (iii) an action taken for the purpose of protecting public safety (e.g., to protect against acts of war, the spread of communicable diseases, or an infestation), and no such governmental actions shall entitle Tenant to any compensation from Landlord or any authority, or Rent abatement or any other remedy under this Lease. If more than ten percent (10%) of the floor area of the Premises taken by a Taking, Tenant may, at its option, terminate this Lease as of the date the condemning authority takes possession, by providing Landlord notice in writing of its intent to terminate not later than thirty (30) days after Landlord shall have notified Tenant of the taking. Failure of Tenant to so notify Landlord shall constitute Tenant's agreement to continue the Lease in full force and effect as to the balance of the Premises.

**14. ASSIGNMENT AND SUBLETTING** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1 **<u>Transfers</u>**. Tenant shall not, without the prior written consent of Landlord, assign, sublet, license, mortgage, pledge, hypothecate, encumber, or transfer this Lease or the Premises in whole or in part whether by changes in the ownership or control of Tenant, or any direct or indirect owner of Tenant, whether at one time or at intervals, by sale or transfer of stock, partnership or beneficial interests, operation of law or otherwise, or permit the occupancy or use of the Premises or any part thereof by any persons other than Tenant and its employees and contractors (all of the foregoing are hereinafter sometimes referred to collectively as "**Transfers**" and any person to whom any Transfer is made or sought to be made is hereinafter sometimes referred to as a "**Transferee**"). If Tenant desires Landlord's consent to any Transfer, Tenant shall notify Landlord in writing, which notice (the "**Transfer Notice**") shall include (i) the proposed effective date of the Transfer, which shall not be less than thirty (30) days nor more than one hundred eighty (180) days after the date of delivery of the Transfer Notice, (ii) a description of the portion of the

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Premises to be transferred (the "**Subject Space**"), (iii) all of the terms of the proposed Transfer and the consideration therefor, including calculation of the "Transfer Premium" (as that term is defined in <u>Section</u> <u>14.3</u> below) in connection with such Transfer, the name and address of the proposed Transferee, and a copy of all existing executed documentation effectuating the proposed Transfer (which may be redacted if containing any proprietary or confidential information that is not essential to the provisions of this <u>Article 14</u>), provided that Landlord shall have the right to require Tenant to utilize Landlord's standard consent to Transfer documents in connection with the documentation of Landlord's consent to such Transfer, (iv) current financial statements of the proposed Transferee certified by an officer, partner or owner thereof, business credit and personal references and history of the proposed Transferee and any other information reasonably required by Landlord which will enable Landlord to determine the "Net Worth" (as that term is defined in <u>Section</u> <u>14.8</u> below) and the financial responsibility, character, and reputation of the proposed Transferee, nature of such Transferee's business and proposed use of the Subject Space, and (v) a complete statement, certified by an independent certified public accountant, or Tenant's chief financial officer, setting forth in detail the computation of any Transfer Premium Tenant has derived and shall derive from such Transfer. Any Transfer made without Landlord's prior written consent shall, at Landlord's option, be null, void and of no effect, and shall, at Landlord's option, constitute an Event of Default by Tenant under this Lease. Whether or not Landlord consents to any proposed Transfer, Tenant shall pay Landlord's reasonable review and processing fees, as well as any reasonable professional fees (including, without limitation, attorneys', accountants', architects', engineers' and consultants' fees) incurred by Landlord, in an amount not to exceed $5,000.00 per any proposed Transfer, within thirty (30) days after written request by Landlord. Notwithstanding anything contained in this Lease to the contrary, Tenant shall not: (a) make a Transfer to an entity in which, under the Internal Revenue Code of 1986, as amended (the "**Code**"), any entity that directly or indirectly owns Landlord and is qualified as a real estate investment trust (a "**REIT Owner**") owns, directly, indirectly or by applying constructive ownership rules set forth in Section 856(d)(5) of the Code, a ten percent (10%) or greater interest; or (ii) make any Transfer or other action under <u>Section</u> <u>14.8</u>, below, in a manner that would cause any portion of the amounts received by Landlord pursuant hereto to fail to qualify as "rents from real property" within the meaning of Section 856(d) of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2 **<u>Landlord's Consent</u>**. Landlord shall not unreasonably withhold, condition or delay its consent to any proposed Transfer of the Subject Space to the Transferee on the terms specified in the Transfer Notice, and shall notify Tenant whether the proposed Transferee is approved or reasonably disapproved within twenty (20) days after Landlord's receipt of Tenant's Transfer Notice. Without limitation as to other reasonable grounds for withholding consent, it shall be reasonable under this Lease and under Applicable Laws for Landlord to withhold consent to any proposed Transfer where one or more of the following apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.1 The Transferee is of a character or reputation or engaged in a business which is not consistent with the quality of the Building or the Project;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.2 The Transferee is either a governmental agency or instrumentality thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.3 The Transferee is not a party of reasonable financial worth and/or financial stability in light of the responsibilities to be undertaken in connection with the Transfer on the date consent is requested;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.4 Such Transfer would cause a REIT Owner to be in violation of applicable Code requirements for it to maintain status as a "real estate investment trust" under Sections 856 through 860 of the Code or would violate any provision of this <u>Section</u> <u>14.1</u>;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.5 The proposed Transfer would cause a violation of another lease for space in the Project, or would give an occupant of the Project a right to cancel its lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.6 The Transferee intends to use the Subject Space for purposes which are not permitted under this Lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.7 Either the proposed Transferee, or any person or entity which directly or indirectly, controls, is controlled by, or is under common control with, the proposed Transferee, (i) occupies space in the Project at the time of the request for consent and space of comparable size to the Subject Space is available for lease in the Building on a direct basis from Landlord, or (ii) is negotiating with Landlord to lease space in the Project at such time and space of comparable size to the Subject Space is available for lease in the Building on a direct basis from Landlord, or (iii) has negotiated with Landlord during the six (6)-month period immediately preceding the Transfer Notice and space of comparable size to the Subject Space is available for lease in the Building on a direct basis from Landlord; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.8 The Transferee does not intend to occupy the entire Premises and conduct its business therefrom for a substantial portion of the term of the Transfer.

If Landlord consents to any Transfer pursuant to the terms of this <u>Section</u> <u>14.2</u> (and does not exercise any recapture rights Landlord may have under <u>Section</u> <u>14.4</u>), Tenant may within six (6) months after Landlord's consent, but not later than the expiration of said six (6)-month period, enter into such Transfer of the Premises or portion thereof, upon substantially the same terms and conditions as are set forth in the Transfer Notice furnished by Tenant to Landlord pursuant to <u>Section</u> <u>14.1</u>, provided that if there are any changes in the terms and conditions from those specified in the Transfer Notice such that Landlord would initially have been entitled to refuse its consent to such Transfer under this <u>Section</u> <u>14.2</u>, Tenant shall again submit the Transfer to Landlord for its approval and other action under this <u>Article 14</u> (including Landlord's right of recapture, if any, under <u>Section</u> <u>14.4</u>). Notwithstanding anything to the contrary in this Lease, if Tenant or any proposed Transferee claims that Landlord has unreasonably withheld or delayed its consent under <u>Section</u> <u>14.2</u> or otherwise has breached or acted unreasonably under this <u>Article 14</u>, their sole remedies shall be declaratory judgment and an injunction for the relief sought without monetary damages, and Tenant hereby waives the provisions of Section 1995.310 of the California Civil Code, or any successor statute, and all other remedies, including, without limitation, any right at law or equity to terminate this Lease, on its own behalf and, to the extent permitted under all Applicable Laws, on behalf of the proposed Transferee. Tenant shall indemnify, defend and hold harmless Landlord from and against any and all Losses involving any third party or parties (including without limitation Tenant's proposed subtenant or assignee) who claim they were damaged by Landlord's wrongful withholding or conditioning of Landlord's consent.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3 **<u>Transfer Premium</u>**. If Landlord consents to any Transfer, as a condition thereto which the parties hereby agree is reasonable, Tenant shall pay to Landlord fifty percent (50%) of any Transfer Premium received by Tenant from such Transferee (or any subsequent Transferee, e.g., a sub-subtenant) in connection with the Transfer. "**Transfer Premium**" shall mean all rent, additional rent or other consideration payable by such Transferee in connection with the Transfer in excess of the Base Rent and Tenant's Share of Direct Expenses payable by Tenant under this Lease during the term of the Transfer (which shall be calculated on a per rentable square foot basis) if less than all of the Premises is transferred, after deducting the reasonable expenses incurred by Tenant for (i) any changes, alterations and improvements made to the Premises in order to procure the particular Transfer, (ii) brokerage commissions in connection with the particular Transfer, and (iii) reasonable legal fees in negotiating the particular Transfer. Transfer Premium shall also include, but not be limited to, key money, bonus money or other cash consideration paid by Transferee to Tenant in connection with such Transfer, and any payment in excess of fair market value for services rendered by Tenant to Transferee or for assets, fixtures, inventory, equipment, or furniture transferred by Tenant to Transferee in connection with such Transfer. If the Transfer Premium respecting any Transfer shall be found understated, Tenant shall, within thirty (30) days after demand, pay the deficiency, and if understated by more than two percent (2%), Tenant shall pay Landlord's costs of such audit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4 **<u>Landlord's Option as to Subject Space</u>**. In the event Tenant contemplates a Transfer which, together with all prior Transfers then remaining in effect, would cause fifty percent (50%) or more of the Premises to be Transferred for more than fifty percent (50%) of the then remaining Lease Term (taking into account any extension of the Lease Term which has irrevocably exercised by Tenant), Tenant shall give Landlord notice (the "**Intention to Transfer Notice**") of such contemplated Transfer (whether or not the contemplated Transferee or the terms of such contemplated Transfer have been determined). The Intention to Transfer Notice shall specify the portion of and amount of rentable square feet of the Premises which Tenant intends to Transfer (the "**Contemplated Transfer Space**"), the contemplated date of commencement of the Contemplated Transfer (the "**Contemplated Effective Date**"), and the contemplated length of the term of such contemplated Transfer, and shall specify that such Intention to Transfer Notice is delivered to Landlord pursuant to this <u>Section</u> <u>14.4</u> in order to allow Landlord to elect to recapture the Contemplated Transfer Space. Thereafter, Landlord shall have the option, by giving written notice to Tenant within thirty (30) days after receipt of any Intention to Transfer Notice, to recapture the Contemplated Transfer Space. Such recapture shall cancel and terminate this Lease with respect to such Contemplated Transfer Space as of the Contemplated Effective Date. In the event of a recapture by Landlord and termination of this Lease with respect to less than the entire Premises, the Base Rent and Tenant's Share of Direct Expenses shall be equitably prorated on the basis of the number of rentable square feet retained by Tenant in proportion to the number of rentable square feet contained in the Premises, and this Lease as so amended shall continue thereafter in full force and effect, and upon request of either party, the parties shall execute written confirmation of the same. If Landlord declines, or fails to elect in a timely manner, to recapture such Contemplated Transfer Space under this <u>Section</u> <u>14.4</u>, then, subject to the other terms of this <u>Article 14</u>, Landlord shall not have any right to recapture the Contemplated Transfer Space with respect to any Transfer made during the nine (9) month period (the "**Nine Month Period**") commencing on the last day of such thirty (30) day period, provided that any such Transfer is substantially on the terms set forth in the Intention to Transfer Notice, and provided further that any such Transfer shall be subject to the remaining terms of this <u>Article 14</u>. If such a Transfer is not so consummated within the Nine Month Period (or if a Transfer is so consummated, then upon the expiration of the term of any Transfer of such Contemplated Transfer Space consummated within such Nine Month Period), Tenant shall again be required to submit a new Intention to Transfer Notice to Landlord with respect any contemplated Transfer, as provided above in this <u>Section</u> <u>14.4</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5 **<u>Effect of Transfer</u>**. If Landlord consents to any Transfer, (i) the terms and conditions of this Lease shall in no way be deemed to have been waived or modified, (ii) such consent shall not be deemed consent to any further Transfer by either Tenant or a Transferee, and (iii) no Transfer relating to this Lease or agreement entered into with respect thereto, whether with or without Landlord's consent, shall relieve Tenant or any guarantor of the Lease from any liability under this Lease, including, without limitation, in connection with the Subject Space.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6 **<u>Intentionally Omitted</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7 **<u>Occurrence of Default</u>**. Any Transfer shall be subordinate and subject to the provisions of this Lease, and if this Lease shall be terminated during the term of any Transfer, Landlord shall have the right to: (i) treat such Transfer as cancelled and repossess the Subject Space by any lawful means, or (ii) require that such Transferee attorn to and recognize Landlord as its landlord under any such Transfer on the terms of the sublease (or in the case of an assignment, on the terms of this Lease). If Tenant shall be in default under this Lease, Landlord is hereby irrevocably authorized, to make all payments under or in connection with the Transfer directly to Landlord (which Landlord shall apply towards Tenant's obligations under this Lease) until such default is cured. Such Transferee shall rely on any representation by Landlord that Tenant is in default hereunder, without any need for confirmation thereof by Tenant. Upon any assignment, the assignee shall assume in writing all obligations and covenants of Tenant thereafter to be performed or observed under this Lease. No collection or acceptance of rent by Landlord from any Transferee shall be deemed a waiver of any provision of this <u>Article 14</u> or the approval of any Transferee or a release of Tenant from any obligation under this Lease, whether theretofore or thereafter accruing. In no event shall Landlord's enforcement of any provision of this Lease against any Transferee be deemed a waiver of Landlord's right to enforce any term of this Lease against Tenant or any other person. If Tenant's obligations hereunder have been guaranteed, Landlord's consent to any Transfer shall not be effective unless the guarantor also consents to such Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8 **<u>Permitted Transfers</u>**. Notwithstanding anything to the contrary set forth in this Lease, Landlord shall not withhold its consent to a Transfer, nor have any recapture rights under <u>Section</u> <u>14.4</u> above, which (i) is an assignment or subletting of all or a portion of the Premises to an affiliate of Tenant, which for purposes of this Lease shall mean an entity which is controlled by, controls, or is under common control with, Tenant as of the Effective Date (an "**Affiliate**"), (ii) is a sale of corporate shares of capital stock or other ownership interests in Tenant in connection with an initial public offering of Tenant's stock on a nationally-recognized stock exchange, (iii) is an assignment of the Lease to an entity which acquires all or substantially all of the stock, other ownership interests or assets of Tenant, or (iv) is an assignment of the Lease to an entity which is the resulting entity of a merger or consolidation of Tenant during the Lease Term or (v) results in a change in control of Tenant due to a merger or consolidation, or sale of Tenant's previously controlling entity (any such merger, consolidation, assignment or sublease, a "**Permitted Transfer**", and any such assignee, sublessee or surviving Tenant shall be hereinafter referred to as a "**Permitted Transferee**"), provided that (a) Tenant notifies Landlord at least thirty (30) days prior to the effective date of any contemplated Permitted Transfer and promptly supplies Landlord with any documents or information reasonably requested by Landlord regarding such Permitted

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Transfer or Permitted Transferee, (b) Tenant delivers evidence of insurance as required under this Lease with respect to the Permitted Transferee, (c) Tenant is not in default under this Lease beyond all applicable notice and cure periods, and such Transfer is not a subterfuge by Tenant to avoid its obligations under this Lease, (d) such Permitted Transferee shall be of a character and reputation consistent and compatible with the operation and quality of the Project, (e) such Permitted Transferee shall have a tangible net worth (not including intangibles, such as goodwill, as an asset) computed in accordance with generally accepted accounting principles ("**Net Worth**") and other financial indicators sufficient to meet Tenant's obligations under the Transfer instrument in question and its obligations hereunder, (f) Tenant shall not be relieved from any liability under this Lease, (g) the liability of such Permitted Transferee under either an assignment or sublease shall be joint and several with Tenant, and (h) Tenant and the Permitted Transferee shall execute and deliver to Landlord, prior to the effective date of the Transfer (and as a condition to the effectiveness of the Transfer), Landlord's then-standard form of acknowledgement representing that the conditions of this <u>Section</u> <u>14.8</u> are true and accurate with respect to such Transfer. The occurrence of a Transfer pursuant to this <u>Section</u> <u>14.8</u> shall not waive Landlord's rights as to any subsequent Transfers.

**15. SURRENDER OF PREMISES; OWNERSHIP AND REMOVAL OF TRADE FIXTURES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1 **<u>Surrender of Premises</u>**. No act or thing done by Landlord or any agent or employee of Landlord during the Lease Term shall be deemed to constitute an acceptance by Landlord of a surrender of the Premises unless such intent is specifically acknowledged in writing by Landlord. The delivery of keys to the Premises to Landlord or any agent or employee of Landlord shall not constitute a surrender of the Premises or effect a termination of this Lease, whether or not the keys are thereafter retained by Landlord, and notwithstanding such delivery Tenant shall be entitled to the return of such keys at any reasonable time upon request until this Lease shall have been properly terminated. The voluntary or other surrender of this Lease by Tenant, whether accepted by Landlord or not, or a mutual termination hereof, shall not work a merger, and at the option of Landlord shall operate as an assignment to Landlord of all subleases or subtenancies affecting the Premises or terminate any or all such sublessees or subtenancies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.2 **<u>Removal Requirements</u>**. Upon the expiration of the Lease Term, or upon any earlier termination of this Lease, Tenant shall, subject to the provisions of this <u>Article 15</u>, quit and surrender possession of the Premises to Landlord in as good order and condition as when Tenant took possession and as thereafter improved by Landlord and/or Tenant, reasonable wear and tear and repairs which are specifically made the responsibility of Landlord hereunder and casualty excepted. Upon such expiration or termination, Tenant shall, without expense to Landlord, remove or cause to be removed from the Premises all debris and rubbish, and such items of furniture, equipment, freestanding cabinet work, movable partitions and other articles of personal property owned by Tenant or installed or placed by Tenant at its expense in the Premises, and such similar articles of any other persons claiming under Tenant, as Landlord may, in its reasonable discretion, require to be removed, and Tenant shall repair at its own expense all damage to the Premises and Building resulting from such removal. With respect to any Alterations that are not Removal Items, Tenant shall leave the same in good working order and condition, deliver to Landlord all necessary user information such that the same may be used by a future occupant of the Premises (e.g., any water sensors that remain shall be unblocked and ready for use by a third-party). If Tenant fails to

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perform the foregoing removal, repair and restoration obligations, then Landlord may do so and may charge the cost thereof to Tenant. Tenant hereby protects, defends, indemnifies and holds Landlord harmless from and against any Losses relating to the installation, placement, removal or financing of any such Alterations, fixtures and/or equipment in, on or about the Premises or the Project, which obligations of Tenant shall survive the expiration or earlier termination of this Lease. Notwithstanding anything in this Lease and/or the Tenant Work Letter to the contrary, any glasswash and/or moveable lab benches acquired and installed in the Premises as a part of Landlord's Delivery Work and/or as a part of the Tenant Improvements using the Special Allowance shall remain the Property of Landlord upon the expiration or earlier termination of the Lease and Tenant shall not remove the same from the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.3 **<u>Environmental Assessment</u>**. In connection with its surrender of the Premises, Tenant shall submit to Landlord, at least forty-five (45) days prior to the Lease Expiration Date (or in the event of an earlier termination of this Lease, as soon as reasonably possible following such termination), an environmental Assessment of the Premises by a competent and experienced environmental engineer or engineering firm reasonably satisfactory to Landlord (pursuant to a contract reasonably approved by Landlord and providing that Landlord can rely on the Environmental Assessment). If such Environmental Assessment reveals that remediation or Clean-up is required under any Environmental Laws that Tenant is responsible for under this Lease, Tenant shall submit a remediation plan prepared by a recognized environmental consultant and shall be responsible for all costs of remediation and Clean-up, as more particularly provided in <u>Section</u> <u>5.3</u>, above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.4 **<u>Condition of the Building and Premises Upon Surrender</u>**. In addition to the above requirements of this <u>Article 15</u>, upon the expiration of the Lease Term, or upon any earlier termination of this Lease, Tenant shall, surrender the Premises and Building with Tenant having complied with all of Tenant's obligations under this Lease, including those relating to improvement, repair, maintenance, compliance with law, testing and other related obligations of Tenant set forth in <u>Article 7</u> of this Lease. In the event that the Building and Premises shall be surrendered in a condition which does not comply with the terms of this <u>Section</u> <u>15.4</u>, because Tenant failed to comply with its obligations set forth in Lease, then following thirty (30) days' notice to Tenant, during which thirty (30) day period Tenant shall have the right to cure such noncompliance, Landlord shall be entitled to expend all reasonable costs in order to cause the same to comply with the required condition upon surrender and Tenant shall immediately reimburse Landlord for all such costs upon notice and Tenant shall be deemed during the period that Tenant or Landlord, as the case may be, perform obligations relating to the Surrender Improvements to be in holdover under <u>Article 16</u> of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.5 **<u>Disposal Rights</u>**. Without limiting any other rights or remedies of Landlord, any of Tenant's Property not removed by Tenant upon the expiration of this Lease, or within forty-eight (48) hours after any early termination of this Lease, shall be considered abandoned and Landlord may, at its sole election (and regardless of the value of such property), (i) elect to take ownership of any or all of such property (in which event, subject to the rights of any third parties who have an ownership or security interest in any such property, Landlord may use, sell, or dispose of such property in Landlord's sole discretion), or (ii) store any or all of such property in a public warehouse or elsewhere (including at Landlord's property) for the account, and at the expense and risk, of Tenant. If Landlord elects to store Tenant's Property, then Tenant shall pay the cost of

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storing the same to Landlord (based on the actual costs and expenses incurred by Landlord in connection therewith, plus an 8% administrative fee, or if the property is being stored at property owned or controlled by Landlord or its affiliates, based on the then fair market rental value of the applicable space, in all cases as reasonably determined by Landlord). If Landlord elects to store any such personal property in accordance with item (ii) above, then Landlord may thereafter elect to take ownership of such property pursuant to item (i) above at any time prior to Tenant recovering possession of the subject property. The terms and conditions of this <u>Section</u> <u>15.5</u> have been specifically bargained for, and, to the maximum extent permitted by law, Tenant expressly waives the right to receive any notices under California Civil Code Section 1993 et seq., or any other statutory procedures with respect to abandoned personal property.

**16. HOLDING OVER**. Unless otherwise agreed to by Landlord in writing (in Landlord's sole and absolute discretion) if Tenant holds over after the expiration of the Lease Term or earlier termination thereof, such tenancy shall be a tenancy at sufferance, and shall not constitute a renewal hereof or an extension for any further term, and in such case, daily damages in any action to recover possession of the Premises shall be calculated at a daily rate equal to greater of (i) a Base Rent amount equal to (A) for the first two (2) months of any such holdover period, one hundred fifty percent (150%) of the Base Rent applicable during the last rental period of the Lease Term under this Lease (calculated on a per diem basis), and (B) following such two (2)-month period and during the remaining duration of any such holdover period, two hundred percent (200%) of the Base Rent applicable during the last rental period of the Lease Term under this Lease (calculated on a per diem basis), plus one hundred percent (100%) of all other Rent applicable during the last rental period of the Lease Term under this Lease (calculated on a per diem basis) or (ii) the fair market rental rate for the Premises as of the commencement of such holdover period (as determined by Landlord in its commercially reasonable discretion). Nothing contained in this <u>Article 16</u> shall be construed as consent by Landlord to any holding over by Tenant, and Landlord expressly reserves the right to require Tenant to vacate and deliver possession of the Premises to Landlord as provided in this Lease upon the expiration or other termination of this Lease. The provisions of this <u>Article 16</u> shall not be deemed to limit or constitute a waiver of any other rights or remedies of Landlord provided herein or at law. If Tenant holds over without Landlord's express written consent, and tenders payment of rent for any period beyond the expiration of the Lease Term by way of check (whether directly to Landlord, its agents, or to a lock box) or wire transfer, the cashing of such check or acceptance of such wire shall be considered inadvertent and not be construed as creating a month-to-month tenancy, provided Landlord refunds such payment to Tenant promptly upon learning that such check has been cashed or wire transfer received. Any holding over without Landlord's express written consent may compromise or otherwise affect Landlord's ability to enter into new leases with prospective tenants regarding the Premises. Therefore, if Tenant fails to vacate and deliver the Premises upon the termination or expiration of this Lease, in addition to any other Losses to Landlord accruing therefrom, Tenant shall protect, defend, indemnify and hold Landlord harmless from and against all claims made by any succeeding tenant founded upon such failure to vacate and deliver, and any Losses suffered by Landlord, including lost profits, resulting from such failure to vacate and deliver. In addition, Tenant shall be liable for all damages (including attorneys' fees and expenses) of whatever type (including consequential damages) incurred by Landlord as a result of any holding over. Tenant agrees that any proceedings necessary to recover possession of the Premises, whether before or after expiration of the Lease Term, shall be considered an action to enforce the terms of this Lease for purposes of the awarding of any attorney's fees in connection therewith.

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**17. ESTOPPEL CERTIFICATES; FINANCIAL STATEMENTS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1 **<u>Estoppel Certificates</u>**. Within ten (10) business days following a request in writing by Landlord, Tenant shall execute, acknowledge and deliver to Landlord an estoppel certificate, which, as submitted by Landlord, shall be substantially in the form of **<u>Exhibit D</u>**, attached hereto (or such other form as may be required by any prospective mortgagee or purchaser of the Project, or any portion thereof), indicating therein any exceptions thereto that may exist at that time, and shall also contain any other information reasonably requested by Landlord or Landlord's mortgagee or prospective mortgagee. Any such certificate may be relied upon by any prospective mortgagee or purchaser of all or any portion of the Project. Tenant shall execute and deliver whatever other instruments may be reasonably required for such purposes. Failure of Tenant to timely execute, acknowledge and deliver such estoppel certificate or other instruments shall constitute an acceptance of the Premises and an acknowledgment by Tenant that statements included in the estoppel certificate are true and correct, without exception.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2 **<u>Financial Statements</u>**. At any time during the Lease Term, unless Tenant's financials are otherwise reasonably publicly available, Landlord may require Tenant to provide Landlord with (i) a balance sheet for the most recent quarter-end date, (ii) a statement of cash flows for the most recent quarter-end date, and (iii) an income statement for the trailing twelve (12) month period ending on the most recent month-end date. Such financial statements shall be prepared in accordance with generally accepted accounting principles and, if such is the normal practice of Tenant, shall be audited by an independent certified public accountant (or, if not so audited, the same shall be reviewed by a nationally recognized CPA firm and certified by an officer of Tenant). Tenant shall promptly provide Landlord with written notice of any lawsuit that is filed (or judgment entered) against Tenant that would materially impair Tenant's ability to perform its obligations under this Lease.

**18. SUBORDINATION**. This Lease shall be subject and subordinate to all present and future ground or underlying leases of the Building or Project and to the lien of any mortgage, trust deed or other encumbrances now or hereafter in force against the Building or Project or any part thereof, if any, and to all renewals, extensions, modifications, consolidations and replacements thereof, and to all advances made or hereafter to be made upon the security of such mortgages or trust deeds, unless the holders of such mortgages, trust deeds or other encumbrances, or the lessors under such ground lease or underlying leases, require in writing that this Lease be superior thereto. Tenant covenants and agrees in the event any proceedings are brought for the foreclosure of any such mortgage or deed in lieu thereof (or if any ground lease is terminated), to attorn, without any deductions or set-offs whatsoever, to the lienholder or purchaser or any successors thereto upon any such foreclosure sale or deed in lieu thereof (or to the ground lessor), if so requested to do so by such purchaser or lienholder or ground lessor, and to recognize such purchaser or lienholder or ground lessor as the lessor under this Lease, provided such lienholder or purchaser or ground lessor shall agree to accept this Lease and not disturb Tenant's occupancy, so long as Tenant timely pays Rent and observes and performs the terms, covenants and conditions of this Lease to be observed and performed by Tenant. Landlord's interest herein may be assigned as security at any time to any lienholder. Notwithstanding any contrary provision in this <u>Article 18</u>, a condition precedent to

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the subordination of this Lease to any future ground or underlying lease or to the lien of any future Mortgage is that Landlord shall use commercially reasonable efforts to obtain for the benefit of Tenant a commercially reasonable subordination, non-disturbance and attornment agreement ("Future SNDA") from the mortgagee under such future mortgage or deed of trust or the lessor under such future lease. Tenant shall, within five (5) days of request by Landlord, execute such further instruments or assurances as Landlord may reasonably deem necessary to evidence or confirm the subordination or superiority of this Lease to any such mortgages, trust deeds, ground leases or underlying leases. Tenant waives the provisions of any current or future statute, rule or law which may give or purport to give Tenant any right or election to terminate or otherwise adversely affect this Lease and the obligations of the Tenant hereunder in the event of any foreclosure proceeding or sale. Should any current or prospective Mortgagee require a modification of this Lease, which modification will not cause an increased cost or expense to Tenant or in any other way materially and adversely change the rights and obligations of Tenant hereunder, then and in such event, this Lease may be so modified and Tenant shall execute whatever documents are reasonably required therefor and to deliver the same to Landlord within ten (10) days following a request therefor.

**19. DEFAULTS; REMEDIES** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1 **<u>Events of Default</u>**. In addition to any other Events of Default specified elsewhere in this Lease, the occurrence of any of the following shall constitute a default of this Lease by Tenant (each, an "**Event of Default**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.1 Any failure by Tenant to pay any Rent or any other charge required to be paid under this Lease, or any part thereof, when due, which failure continues for five (5) days after written notice of such delinquency; provided, however, that if Landlord has given Tenant two (2) such delinquency notices in the preceding twelve (12) month period, then Tenant's subsequent failure to pay any Rent or other charge when due shall constitute a default under this Lease without requirement of any notice or cure period; provided further, that any such notice given pursuant to this <u>Section</u> <u>19.1.1</u> shall be in lieu of, and not in addition to, any notice required under California Code of Civil Procedure Section 1161 or any similar or successor law; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.2 To the extent permitted by Applicable Laws, (i) Tenant or any guarantor of this Lease being placed into receivership or conservatorship, or becoming subject to similar proceedings under Federal or State law, or (ii) a general assignment by Tenant or any guarantor of this Lease for the benefit of creditors, or (iii) the taking of any corporate action in furtherance of bankruptcy or dissolution whether or not there exists any proceeding under an insolvency or bankruptcy law, or (iv) the filing by or against Tenant or any guarantor of any proceeding under an insolvency or bankruptcy law, unless in the case of such a proceeding filed against Tenant or any guarantor the same is dismissed within sixty (60) days, or (v) the appointment of a trustee or receiver to take possession of all or substantially all of the assets of Tenant or any guarantor, unless possession is restored to Tenant or such guarantor within thirty (30) days, or (vi) any execution or other judicially authorized seizure of all or substantially all of Tenant's assets located upon the Premises or of Tenant's interest in this Lease, unless such seizure is discharged within thirty (30) days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.3 Abandonment of all or a substantial portion of the Premises by Tenant; or

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.4 Except where a specific time period for Tenant's performance is otherwise expressly set forth in this Lease, in which event the failure to perform by Tenant within such time period shall be an Event of Default by Tenant under this <u>Section</u> <u>19.1.4</u>, any failure by Tenant to observe or perform any other provision, covenant or condition of this Lease to be observed or performed by Tenant where such failure continues for thirty (30) days after written notice thereof from Landlord to Tenant; provided that if the nature of such default is such that the same cannot reasonably be cured within a thirty (30) day period (or, as applicable, within the specific time period for Tenant's performance otherwise expressly set forth in this Lease), no Event of Default shall be deemed to have occurred under this <u>Section</u> <u>19.1.4</u> if Tenant diligently commences such cure within such period and thereafter diligently proceeds to rectify and cure such default.

Any notices to be provided by Landlord under this <u>Section</u> <u>19.1</u> shall be in lieu of, and not in addition to, any notice required under Section 1161 et seq. of the Code of Civil Procedure, and may be served on Tenant in the manner allowed for service of notices under this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2 **<u>Remedies Upon Event of Default</u>**. Upon the occurrence of any Event of Default by Tenant, Landlord shall have, in addition to any other remedies available to Landlord at law or in equity (all of which remedies shall be distinct, separate and cumulative), the option to pursue any one or more of the following remedies (including, without limitation, during any eviction moratorium, to the extent not prohibited by Applicable Law), each and all of which shall be cumulative and nonexclusive, without any notice or demand whatsoever.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.1 Terminate this Lease, in which event Tenant shall immediately surrender the Premises to Landlord, and if Tenant fails to do so, Landlord may, without prejudice to any other remedy which it may have for possession or arrearages in rent, enter upon and take possession of the Premises and expel or remove Tenant and any other person who may be occupying the Premises or any part thereof, without being liable for prosecution or for any claim for damages therefor; and Landlord may recover from Tenant the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The worth at the time of award of any unpaid rent which has been earned at the time of such termination; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The worth at the time of award of the amount by which the unpaid rent for the balance of the Lease Term after the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom, specifically including but not limited to, brokerage commissions and advertising expenses incurred, expenses of remodeling the Premises or any portion thereof for a new tenant, whether for the same or a different use, and any special concessions made to obtain a new tenant; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) At Landlord's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by Applicable Laws.

The term "**rent**" as used in this <u>Section</u> <u>19.2</u> shall be deemed to be and to mean all sums of every nature required to be paid by Tenant pursuant to the terms of this Lease, whether to Landlord or to others. As used in <u>Sections 19.2.1(i)</u> and <u>(ii)</u>, above, the "worth at the time of award" shall be computed by allowing interest at the Interest Rate. As used in <u>Section</u> <u>19.2.1(iii)</u> above, the "**worth at the time of award**" shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus one percent (1%).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.2 Landlord shall have the remedy described in California Civil Code Section 1951.4 (lessor may continue lease in effect after lessee's breach and abandonment and recover rent as it becomes due, if lessee has the right to sublet or assign, subject only to reasonable limitations). Accordingly, if Landlord does not elect to terminate this Lease on account of any Event of Default by Tenant, Landlord may, from time to time, without terminating this Lease, enforce all of its rights and remedies under this Lease, including the right to recover all rent as it becomes due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.3 Any agreement for free, abated, or reduced Rent or other charges (including, without limitation, the Base Rent Abatement and any Special Allowance Payment), any allowances or other rights of reimbursement granted to Tenant (for improvements, furniture, fixtures, equipment, moving costs, or otherwise), any other agreement for the giving or paying by Landlord to or for the benefit of Tenant of any monetary amounts, and any other bonus, inducement, or other consideration for Tenant entering into this Lease, all of which concessions are hereinafter referred to as "**Inducement Provisions**". Accordingly: (i) with respect to the Special Allowance Payment, (A) if this Lease is terminated as a result of any Event of Default by Tenant, then, in addition to all other rights and remedies of Landlord, at Landlord's sole option (which may be exercised by Landlord at any time following the occurrence of any Event of Default), any unpaid Special Allowance Payment shall be immediately due and payable by Tenant to Landlord, notwithstanding any subsequent cure of the applicable Event of Default, and (B) if this Lease is terminated for any reason that is other than any Event of Default by Tenant (including Landlord's breach of this Lease), then any unpaid Special Allowance Payment shall continue to be repaid by Tenant to Landlord in accordance with the applicable repayment schedule therefor under this Lease as though this Lease had not been so terminated, which repayment obligations shall survive any such termination (such repayment period, the "**Continued Post-Lease Repayment Period**") (and Tenant hereby acknowledges and agrees that, notwithstanding anything in this Lease [including the Letter of Credit Rider] to the contrary, during any such Continued Post-Lease Repayment Period, if any, Tenant shall cause an L-C in the amount of the unpaid Special Allowance Payment to remain in place with Landlord, otherwise subject to and in accordance with the terms and conditions of Letter of Credit Rider attached hereto [<u>e.g.</u>, with an L-C Expiration Date therefor that is sixty (60) days after the Continued Post-Lease Repayment Period]); and (ii) with respect to any Inducement Provision that is in the nature of an agreement for free, abated, or reduced Rent or other charges (including, without limitation, the Base Rent Abatement) (to be referred to herein as the "**Rent Abatement**"), if (A) Tenant shall be in default under this Lease during the period of any Rent Abatement and shall fail to cure such default within the notice and cure period, if any, permitted for cure pursuant to this Lease, then the dollar amount of the unapplied portion of the Rent Abatement as of the date of such default shall be converted to a credit to be applied to the Rent applicable at the end of the Lease Term and Tenant shall no

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longer have the right to abate Rent for the Premises during the remainder of the period of the Rent Abatement; provided, however, if Tenant cures such default and this Lease remains in full force and effect, then such credit shall then be applied commencing on the cure of such default, or (B) this Lease is terminated for an Event of Default by Tenant, then for purposes of calculating Landlord's damages, if any, under Section 1951.2 of the California Civil Code, the dollar amount of the unapplied portion of any such Inducement Provision as of the Event of Default or termination, as the case may be, shall be converted to a credit to be applied to the Base Rent applicable at the end of the Lease Term, and Tenant shall no longer have the right to abate Rent for the Premises during the remainder of the period of Rent Abatement. The acceptance by Landlord of Rent or the cure of any Event of Default shall not be deemed a waiver by Landlord of its rights under this <u>Section</u> <u>19.2.3</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.4 Landlord shall at all times have the rights and remedies (which shall be cumulative with each other and cumulative and in addition to those rights and remedies available under <u>Sections 19.2.1</u>, <u>19.2.2</u>, and <u>19.2.3</u> above, or any law or other provision of this Lease), without prior demand or notice except as required by Applicable Laws, to seek any declaratory, injunctive or other equitable relief, and specifically enforce this Lease, or restrain or enjoin a violation or breach of any provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.5 Notwithstanding anything to the contrary contained in this Lease, nothing in this Lease shall impose any obligation on Tenant or Landlord to be responsible or liable for, and each hereby releases the other from all liability for Consequential Damages, other than those Consequential Damages incurred by Landlord in connection with a holdover of the Premises by Tenant after the expiration or earlier termination of this Lease in accordance with and subject to the restrictions contained in <u>Section</u> <u>16</u> above. Notwithstanding the foregoing, for purposes of this Lease, Consequential Damages shall not be deemed to include future rent damages recoverable by the Landlord pursuant to <u>Sections 19.2.1 (ii)</u> and <u>(iii)</u> above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.3 **<u>Subleases of Tenant</u>**. Whether or not Landlord elects to terminate this Lease on account of any Event of Default, Landlord shall have the right to terminate any and all subleases, licenses, concessions or other consensual arrangements for possession entered into by Tenant and affecting the Premises or may, in Landlord's sole discretion, succeed to Tenant's interest in such subleases, licenses, concessions or arrangements. In the event of Landlord's election to succeed to Tenant's interest in any such subleases, licenses, concessions or arrangements, Tenant shall, as of the date of notice by Landlord of such election, have no further right to or interest in the rent or other consideration receivable thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.4 **<u>Efforts to Relet</u>**. No re-entry or repossession, repairs, maintenance, changes, alterations and additions, reletting, appointment of a receiver to protect Landlord's interests hereunder, or any other action or omission by Landlord shall be construed as an election by Landlord to terminate this Lease or Tenant's right to possession, or to accept a surrender of the Premises, nor shall same operate to release Tenant in whole or in part from any of Tenant's obligations hereunder, unless express written notice of such intention is sent by Landlord to Tenant. Tenant hereby irrevocably waives any right otherwise available under any law to redeem or reinstate this Lease. If Landlord elects to terminate this Lease pursuant to <u>Section</u> <u>19.2</u> above following Tenant's default, Landlord shall mitigate its damages to the extent required by applicable laws.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.5 **<u>Landlord Default</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.5.1 **<u>Landlord Default</u>**. Landlord shall be in default under this Lease only if Landlord fails to perform any of its obligations hereunder following the Lease Commencement Date and such failure continues for thirty (30) days after Tenant delivers to Landlord written notice specifying such failure; however, if such failure cannot reasonably be cured within such 30-day period, but Landlord commences to cure such failure within such 30-day period and thereafter diligently pursues the curing thereof to completion, then Landlord shall not be in default hereunder or liable for damages therefor. Except where the provisions of this Lease grant Tenant an express, exclusive remedy, or expressly deny Tenant a remedy, Tenant's exclusive remedy for Landlord's default under this Lease shall be limited to Tenant's actual direct, but not consequential, damages caused by such default; in each case, Landlord's liability or obligations with respect to any such remedy shall be limited as provided in <u>Section</u> <u>29.13</u> below. All obligations of Landlord under this Lease shall be construed as covenants, not conditions. Tenant hereby waives the benefit of any laws granting it the right to perform Landlord's obligations or the right to terminate this Lease or withhold Rent on account of any Landlord default. Notwithstanding anything to the contrary set forth in this Lease, neither Landlord nor the Landlord Parties shall be liable under any circumstances for injury or damage to, or interference with, Tenant's business, including but not limited to, loss of profits, loss of rents or other revenues, loss of business opportunity, loss of goodwill or loss of use, or any indirect, consequential, or punitive damages or any kind, in each case, however occurring (including, without limitation, in connection with or incidental to a failure to furnish any services or utilities, or any failure to perform any repair or maintenance obligations).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.5.2 **<u>Abatement Event</u>**. In the event that Tenant is prevented from using, and does not use the Premises, as a result of (i) any repair, maintenance or alteration performed by Landlord, or which Landlord failed to perform, after the Lease Commencement Date and required by this Lease, or (ii) any failure to provide utility connections to the Building or the Project or access to the Premises as required by this Lease, each as a direct result of Landlord's negligence or willful misconduct or breach of this Lease (and except to the extent such failure is primarily caused by the action or inaction of Tenant or is outside of Landlord's ability to cure), Tenant shall give Landlord notice (the "**Initial Notice**"), specifying such failure to perform by Landlord (the "**Abatement Event**"). If Landlord has not cured such Abatement Event within five (5) business days after the receipt of the Initial Notice, Tenant may deliver an additional notice to Landlord (the "**Additional Notice**"), specifying such Abatement Event and Tenant's intention to abate the payment of Rent under this Lease. If Landlord does not cure such Abatement Event within five (5) business days of receipt of the Additional Notice, Tenant may, upon written notice to Landlord, immediately abate Rent payable under this Lease for that portion of the Premises rendered untenantable and not used by Tenant for the operation of its business, for the period beginning on the date five (5) business days after the Initial Notice to the earlier of the date Landlord cures such Abatement Event or the date Tenant recommences the use of such portion of the Premises. Such right to abate Rent shall be Tenant's sole and exclusive remedy at law or in equity for an Abatement Event. Except as provided in this <u>Section</u> <u>19.5.2</u>, nothing contained herein shall be interpreted to mean that Tenant is excused from paying Rent due hereunder.

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**20. COVENANT OF QUIET ENJOYMENT.** Landlord covenants that Tenant, on paying the Rent, charges for services and other payments herein reserved and on keeping, observing and performing all the other terms, covenants, conditions, provisions and agreements herein contained on the part of Tenant to be kept, observed and performed, shall, during the Lease Term, peaceably and quietly have, hold and enjoy the Premises subject to the terms, covenants, conditions, provisions and agreements hereof without interference by any persons lawfully claiming by or through Landlord. The foregoing covenant is in lieu of any other covenant express or implied.

**21. INTENTIONALLY OMITTED** 

**22. COMMUNICATIONS AND COMPUTER LINES.** Tenant may install, maintain, replace, remove or use any communications or computer wires and cables serving the Premises (collectively, the "**Lines**"), provided that Tenant shall obtain Landlord's prior written consent, use an experienced and qualified contractor approved in writing by Landlord, and comply with all of the other provisions of <u>Articles 7</u> and <u>8</u> of this Lease. Tenant shall pay all costs in connection therewith. Landlord reserves the right, upon notice to Tenant prior to the expiration or earlier termination of this Lease, to require that Tenant, at Tenant's sole cost and expense, remove any Lines installed by or on behalf of Tenant that are located in or serving the Premises prior to the expiration or earlier termination of this Lease.

**23. SIGNS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1 **<u>Tenant Signage</u>**. Subject to Landlord's prior written approval, which shall not be unreasonably withheld, conditioned or delayed, and provided all signs are in keeping with the quality, design and style of the Building and Project and Landlord's Project standard signage program, Tenant, at its sole cost and expense, may install and maintain the following signage throughout the Lease Term: (i) identification signage on the existing monument sign located outside at west end of the north side of the Building, (ii) outside identification signage at the entrance to the Building, and (iii) internal directional signage and lobby signage on the same floor where the Premises are located (collectively, "**Tenant Signage**"); provided, however, in no event shall Tenant's Signage include an "Objectionable Name," as that term is defined in <u>Section</u> <u>23.3</u> below. All such signage shall be subject to Tenant obtaining all required governmental approvals. All permitted signs shall be maintained by Tenant at its expense in a first-class and safe condition and appearance. Upon the expiration or earlier termination of this Lease, Tenant shall remove all of its signs at Tenant's sole cost and expense. The graphics, materials, color, design, lettering, lighting, size, illumination, specifications and exact location of Tenant's Signage (collectively, the "**Sign Specifications**") shall be subject to the prior written approval of Landlord, which approval shall not be unreasonably withheld, conditioned or delayed, and shall be consistent and compatible with the quality and nature of the Project and Landlord's Project standard signage program. Tenant hereby acknowledges that, notwithstanding Landlord's approval of Tenant's Signage, Landlord has made no representation or warranty to Tenant with respect to the probability of obtaining all necessary governmental approvals and permits for Tenant's Signage. In the event Tenant does not receive the necessary governmental approvals and permits for Tenant's Signage, Tenant's and Landlord's rights and obligations under the remaining TCCs of this Lease shall be unaffected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2 **<u>Objectionable Name</u>**. Tenant's Signage shall not include a name or logo which relates to an entity which is of a character or reputation, or is associated with a political faction or orientation, which is inconsistent with the quality of the Project, or which would otherwise reasonably offend a landlord of the Comparable Buildings (an "**Objectionable Name**"). The parties hereby agree that the following name, or any reasonable derivation thereof, shall be deemed not to constitute an Objectionable Name: "EnCarda."

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.3 **<u>Prohibited Signage and Other Items</u>**. Any signs, notices, logos, pictures, names or advertisements which are installed and that have not been separately approved by Landlord may be removed without notice by Landlord at the sole expense of Tenant. Tenant may not install any signs on the exterior or roof of the Project or in any Common Areas. Any signs, window coverings, or blinds (even if the same are located behind the Landlord- approved window coverings for the Building), or other items visible from the exterior of the Premises or Building, shall be subject to the prior approval of Landlord, in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.4 **<u>Termination of Right to Tenant's Signage</u>**. The rights contained in this <u>Article 23</u> shall be personal to Original Tenant, its Permitted Assignee and Permitted Transferee, and may only be exercised and maintained by such parties (and not any other assignee, sublessee or other transferee of the Original Tenant's interest in this Lease).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5 **<u>Lobby Directory</u>**. Landlord, at Tenant's sole cost and expense, shall install Tenant's name in the Building directory located in the lobby, if any. Any changes to Tenant's lobby directory signage shall be subject to Landlord's prior written approval and shall be performed at Tenant's sole cost and expense. Notwithstanding anything to the contrary contained in this Lease, upon the expiration of the Lease Term, or upon any earlier termination of this Lease, the removal of Tenant's name initially provided for in the Building directory, shall be at Tenant's sole cost and expense.

**24. COMPLIANCE WITH LAW.** Tenant shall not do anything or suffer anything to be done in or about the Premises or the Project which will in any way conflict with any law, statute, ordinance or other rule, directive, order, regulation, guideline or requirement of any governmental entity or governmental agency now in force or which may hereafter be enacted or promulgated (collectively, "**Applicable Laws**"). At its sole cost and expense, subject to Landlord's obligations to comply with Applicable Laws with respect to the Base Building and/or Common Areas serving the Premises as expressly set forth hereinbelow, Tenant shall promptly comply with all Applicable Laws (including the making of any alterations to the Premises required by Applicable Laws) which relate to (i) Tenant's use of, or legal requirements to cease or reduce Tenant's business operations in or Tenant's use of, the Premises, (ii) Tenant's Repair Obligations. Should any standard or regulation now or hereafter be imposed on Landlord or Tenant by a state, federal or local governmental body charged with the establishment, regulation and enforcement of occupational, health or safety standards for employers, employees, landlords or tenants, then Tenant shall, at its sole cost and expense, comply promptly with such standards or regulations. Landlord shall comply with all Applicable Laws relating to the Base Building and/or the Common Areas serving the Premises; provided, that, notwithstanding the foregoing, to the extent Landlord's compliance obligations in the immediately preceding sentence are triggered by any improvements or Alterations made to the Premises by or on behalf of Tenant (including any components of the initial Tenant Improvements described in the Tenant Work Letter that are not depicted on the Approved Space Plan) that are not customary life science use improvements consistent with First Class Life Science Projects or Tenant's particular manner of use of the Premises (as opposed to customary life science use consistent with First Class Life Science Projects), Tenant shall reimburse Landlord for the cost of such compliance within thirty (30) days after invoice from

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Landlord. The judgment of any court of competent jurisdiction or the admission of Tenant in any judicial action, regardless of whether Landlord is a party thereto, that Tenant has violated any of said governmental measures, shall be conclusive of that fact as between Landlord and Tenant. For purposes of Section 1938 of the California Civil Code, Landlord hereby discloses to Tenant, and Tenant hereby acknowledges, that the Project, Building and Premises have not undergone inspection by a Certified Access Specialist (CASp). As required by Section 1938(e) of the California Civil Code, Landlord hereby states as follows: "A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises, the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant, if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection, the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction- related accessibility standards within the premises." In furtherance of the foregoing, Landlord and Tenant hereby agree as follows: (a) any CASp inspection requested by Tenant shall be conducted, at Tenant's sole cost and expense, by a CASp approved in advance by Landlord; and (b) pursuant to <u>Article 24</u> below, Tenant, at its cost, is responsible for making any repairs within the Premises to correct violations of construction-related accessibility standards; and, if anything done by or for Tenant in its use or occupancy of the Premises shall require repairs to the Building (outside the Premises) to correct violations of construction-related accessibility standards, then Tenant shall, at Landlord's option, either perform such repairs at Tenant's sole cost and expense or reimburse Landlord upon demand, as Additional Rent, for the cost to Landlord of performing such repairs.

**25. LATE CHARGES.** If any installment of Rent or any other sum due from Tenant shall not be received by Landlord or Landlord's designee within five (5) days after the due date therefor, then Tenant shall pay to Landlord a late charge equal to five percent (5%) of the overdue amount plus any reasonable attorneys' fees incurred by Landlord by reason of Tenant's failure to pay such amounts when due; provided, however, that Tenant shall not be required to pay a late charge for the first (1<sup>st</sup>) late payment in any consecutive twelve (12) month period to the extent Tenant pays the amount due within five (5) days after receipt of written notice from Landlord that Tenant failed to make such payment when due. The parties agree that such late charge represents a fair and reasonable estimate of the costs that Landlord will incur by reason of such late payment by Tenant. The late charge shall be deemed Additional Rent and the right to require it shall be in addition to all of Landlord's other rights and remedies hereunder or at law and shall not be construed as limiting Landlord's remedies in any manner. In addition to the late charge described above, any Rent or other amounts owing hereunder which are not paid within ten (10) days after the date they are due shall bear interest from the date when due until paid at an annual interest rate (the "**Interest Rate**") equal to the lesser of (i) the annual "Bank Prime Loan" rate cited in the Federal Reserve Statistical Release Publication H.15(519), published weekly (or such other comparable index as Landlord and Tenant shall reasonably agree upon if such rate ceases to be published), plus four (4) percentage points, and (ii) the highest rate permitted by Applicable Laws; provided, however, that Tenant shall not be required to pay interest for the first (1<sup>st</sup>) late payment in any consecutive twelve (12) month period to the extent Tenant pays the amount due within five (5) days after receipt of written notice from Landlord that Tenant failed to make such payment when due.

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**26. LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.1 **<u>Landlord's Cure</u>**. All covenants and agreements to be kept or performed by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and expense and without any reduction of Rent, except to the extent, if any, otherwise expressly provided herein. If Tenant shall fail to perform any obligation under this Lease, and such failure shall continue in excess of the time allowed under <u>Section</u> <u>19.1.4</u>, above, unless a specific time period is otherwise stated in this Lease, Landlord may, but shall not be obligated to, make any such payment or perform any such act on Tenant's part without waiving its rights based upon any default of Tenant and without releasing Tenant from any obligations hereunder. Landlord shall have the right to apply payments received from Tenant pursuant to this Lease, regardless of Tenant's designation of such payments, to satisfy any obligations of Tenant hereunder, in such order and amounts as Landlord, in its sole discretion, may elect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.2 **<u>Tenant's Reimbursement</u>**. Except as may be specifically provided to the contrary in this Lease, Tenant shall pay to Landlord, upon delivery by Landlord to Tenant of statements therefor: (i) sums equal to expenditures reasonably made and obligations incurred by Landlord in connection with the remedying by Landlord of Tenant's defaults pursuant to the provisions of <u>Section</u> <u>26.1</u>; and (ii) subject to <u>Section</u> <u>29.21 below</u>, sums equal to all expenditures made and obligations incurred by Landlord in collecting or attempting to collect the Rent or in enforcing or attempting to enforce any rights of Landlord under this Lease or pursuant to law, including, without limitation, all reasonable attorneys' fees, legal costs, and other amounts so expended. Tenant's obligations under this <u>Section</u> <u>26.2</u> shall survive the expiration or earlier termination of the Lease Term.

**27. ENTRY BY LANDLORD.** Landlord reserves the right at all reasonable times and upon at least twenty- four (24) hours prior notice to Tenant (except in the case of an emergency, in which case no prior notice is required) to enter the Premises to (i) inspect them; (ii) show the Premises to prospective purchasers, or to current or prospective Mortgagees or insurers, or during the last twelve (12) months of the Lease Term (or at any time during which a monetary or material non-monetary Event of Default is continuing under this Lease), to prospective tenants; (iii) post notices of non-responsibility; or (iv) perform Landlord's Repair Obligations. Notwithstanding anything to the contrary contained in this <u>Article 27</u>, Landlord may enter the Premises at any time without notice to (a) perform any services required of Landlord; (b) take possession due to any breach of this Lease in the manner provided herein; and (c) perform any covenants of Tenant which Tenant fails to perform. Landlord may make any such entries without the abatement of Rent, except as otherwise provided in this Lease, and may take such reasonable steps as required to accomplish the stated purposes; provided, however, any such entry (other than under (b) above) shall be accomplished as expeditiously as reasonably possible and performed in a manner so as not to unreasonably interfere with Tenant's use of the Premises and cause as little interference to Tenant as reasonably possible and, except for (x) emergencies, or (y) repairs, alterations, improvements or additions required by Applicable Laws, shall be performed after normal business hours if reasonably practical. Landlord shall use commercially reasonable efforts to schedule entries into the Premises under this <u>Section</u> <u>27</u> with Tenant (except if not reasonably practicable in

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emergencies) so that Tenant, at Tenant's option, may provide an employee or a representative of Tenant to accompany Landlord. Tenant hereby waives any Losses for any injuries or inconvenience to or interference with Tenant's business, lost profits, any loss of occupancy or quiet enjoyment of the Premises, and any other loss occasioned by such entries. For each of the above purposes, Landlord shall at all times have a key with which to unlock all the doors in the Premises, excluding Tenant's vaults, safes and special security areas designated in advance by Tenant. In an emergency, Landlord shall have the right to use any means that Landlord may deem proper to open the doors in and to the Premises. Any entry into the Premises by Landlord in the manner hereinbefore described shall not be deemed to be a forcible or unlawful entry into, or a detainer of, the Premises, or an actual or constructive eviction of Tenant from any portion of the Premises.

**28. TENANT PARKING.** Tenant shall have the right to use, for the parking of vehicles, the amount of parking set forth in <u>Section</u> <u>9</u> of the Summary, in the on-site and/or off-site, as the case may be, parking facility (or facilities) which serve the Project. Tenant shall abide by all reasonable rules and regulations which are prescribed from time to time for the orderly operation and use of the parking facility where the parking spaces are located (including any sticker or other identification system established by Landlord and the prohibition of vehicle repair and maintenance activities in the parking facilities), and shall cooperate in seeing that Tenant's employees and visitors also comply with such rules and regulations. Tenant's use of the Project parking facility shall be at Tenant's sole risk and Tenant acknowledges and agrees that, subject to Landlord's indemnification obligations expressly set forth in <u>Section</u> <u>10.1</u> above, Landlord shall have no liability whatsoever for damage to the vehicles of Tenant, its employees and/or visitors, or for other personal injury or property damage or theft relating to or connected with the parking rights granted herein or any of Tenant's, its employees' and/or visitors' use of the parking facilities.

**29. MISCELLANEOUS PROVISIONS** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.1 **<u>Terms; Captions</u>**. The words "**Landlord**" and "**Tenant**" as used herein shall include the plural as well as the singular. The necessary grammatical changes required to make the provisions hereof apply either to corporations or partnerships or individuals, men or women, as the case may require, shall in all cases be assumed as though in each case fully expressed. The captions of Articles and Sections are for convenience only and shall not be deemed to limit, construe, affect or alter the meaning of such Articles and Sections.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.2 **<u>Binding Effect</u>**. Subject to all other provisions of this Lease, each of the covenants, conditions and provisions of this Lease shall extend to and shall, as the case may require, bind or inure to the benefit not only of Landlord and of Tenant, but also of their respective heirs, personal representatives, successors or assigns, provided this clause shall not permit any assignment by Tenant contrary to the provisions of <u>Article 14</u> of this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.3 **<u>No Air Rights</u>**. No rights to any view or to light or air over any property, whether belonging to Landlord or any other person, are granted to Tenant by this Lease. If at any time any windows of the Premises are temporarily darkened or the light or view therefrom is obstructed by reason of any repairs, improvements, maintenance or cleaning in or about the Project, the same shall be without liability to Landlord and without any reduction or diminution of Tenant's obligations under this Lease.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.4 **<u>Modification of Lease</u>**. Should any current or prospective mortgagee or ground lessor for the Building or Project require a modification of this Lease, which modification will not cause an increased cost or expense to Tenant or in any other way materially and adversely change the rights and obligations of Tenant hereunder, then and in such event, Tenant agrees that this Lease may be so modified and agrees to execute whatever commercially reasonable documents are reasonably required therefor and to deliver the same to Landlord within ten (10) business days following a request therefor. At the request of any mortgagee or ground lessor, Tenant agrees to execute a short form of Lease and deliver the same to Landlord within ten (10) business days following the request therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.5 **<u>Transfer of Landlord's Interest</u>**. Landlord has the right to transfer all or any portion of its interest in the Project or Building and in this Lease, and in the event of any such transfer, (i) Landlord shall automatically be released from all liability under this Lease arising after the date of such transfer, (ii) Tenant shall look solely to such transferee for the performance of Landlord's obligations hereunder after the date of transfer, (iii) such transferee shall be deemed to have fully assumed and be liable for all obligations of this Lease to be performed by Landlord, including the return of any Security Deposit, and (iv) Tenant shall attorn to such transferee. Landlord may also assign its interest in this Lease to a mortgagee as additional security, but such an assignment shall not release Landlord from its obligations hereunder and Tenant shall continue to look to Landlord for the performance of its obligations hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.6 **<u>Prohibition Against Recording</u>**. Except as provided in <u>Section</u> <u>29.4</u> above, neither this Lease, nor any memorandum, affidavit or other writing with respect thereto, shall be recorded by Tenant or by anyone acting through, under or on behalf of Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.7 **<u>Landlord's Title</u>**. Landlord's title is and always shall be paramount to the title of Tenant. Nothing herein contained shall empower Tenant to do any act which can, shall or may encumber the title of Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.8 **<u>Relationship of Parties</u>**. Nothing contained in this Lease shall be deemed or construed by the parties hereto or by any third party to create the relationship of principal and agent, partnership, joint venture or any association between Landlord and Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.9 **<u>Material Adverse Judgments</u>**. Tenant hereby represents and warrants that, to its actual knowledge (without duty of inquiry), as of the Effective Date (i) there are no actions pending against Tenant under the bankruptcy or similar laws of the United States or any state, and (ii) there are no actions filed and pending against Tenant that, if determined or adjudicated adversely to Tenant, could materially impair Tenant's ability to perform its obligations under this Lease ("**Material Adverse Judgments**"). During the Lease Term, if any Material Adverse Judgment is made or entered against Tenant, Tenant shall promptly notify Landlord of such Material Adverse Judgment in writing with reasonably sufficient detail.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.10 **<u>Time of Essence</u>**. Time is of the essence with respect to the performance of every provision of this Lease in which time of performance is a factor.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.11 **<u>Partial Invalidity</u>**. If any term, provision or condition contained in this Lease shall, to any extent, be invalid or unenforceable, the remainder of this Lease, or the application of such term, provision or condition to persons or circumstances other than those with respect to which it is invalid or unenforceable, shall not be affected thereby, and each and every other term, provision and condition of this Lease shall be valid and enforceable to the fullest extent possible permitted by law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.12 **<u>No Warranty</u>**. In executing and delivering this Lease, Tenant has not relied on any representations, including, but not limited to, any representation as to the amount of any item included in Direct Expenses or the amount of Direct Expenses in the aggregate or that Landlord is furnishing the same services to other tenants, at all, on the same level or on the same basis, or any warranty or any statement of Landlord which is not expressly set forth in this Lease or in one or more of the exhibits attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.13 **<u>Landlord Exculpation</u>**. The liability of Landlord or the Landlord Parties to Tenant for any default by Landlord under this Lease or arising in connection herewith or with Landlord's operation, management, leasing, repair, renovation, alteration or any other matter relating to the Project or the Premises shall be limited solely and exclusively to an amount which is equal to the lesser of (a) the interest of Landlord in the Building or (b) the equity interest Landlord would have in the Building if the Building were encumbered by third-party debt in an amount equal to eighty percent (80%) of the value of the Building (as such value is determined by Landlord), including all proceeds received from the Building and Project, including all sale proceeds, rent proceeds, insurance proceeds and condemnation awards, but excluding any sale proceeds following any distribution thereof in the normal course of Landlord's business operations following any such sale, and not as a subterfuge to this Section 29.13). Neither Landlord, nor any of the Landlord Parties (nor Tenant) shall have any personal liability therefor, and Tenant and Landlord, as the case may be, hereby expressly waives and releases such personal liability on behalf of itself and all persons claiming by, through or under such party. The limitations of liability contained in this <u>Section</u> <u>29.13</u> shall inure to the benefit of Landlord's and the Landlord Parties' present and future partners, beneficiaries, officers, directors, trustees, shareholders, agents and employees, and their respective partners, heirs, successors and assigns. Under no circumstances shall any present or future partner of Landlord (if Landlord is a partnership), or trustee or beneficiary (if Landlord or any partner of Landlord is a trust), have any liability for the performance of Landlord's obligations under this Lease. Notwithstanding any contrary provision herein, neither Landlord nor the Landlord Parties shall be liable under any circumstances for injury or damage to, or interference with, Tenant's business, including but not limited to, loss of profits, loss of rents or other revenues, loss of business opportunity, loss of goodwill or loss of use, in each case, however occurring, or loss to inventory, scientific research, scientific experiments, laboratory animals, products, specimens, samples, and/or scientific, business, accounting and other records of every kind and description kept at the premises and any and all income derived or derivable therefrom.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.14 **<u>Entire Agreement</u>**. It is understood and acknowledged that there are no oral agreements between the parties hereto affecting this Lease and this Lease constitutes the parties' entire agreement with respect to the leasing of the Premises and supersedes and cancels any and all previous negotiations, arrangements, brochures, agreements and understandings, if any, between the parties hereto (including, without limitation, any confidentiality agreement, letter of intent, request for proposal, or similar agreement previously entered into between Landlord and Tenant in anticipation of this Lease) or displayed by Landlord to Tenant with respect to the subject matter thereof, and none thereof shall be used to interpret or construe this Lease. None of the terms, covenants, conditions or provisions of this Lease can be modified, deleted or added to except in writing signed by the parties hereto.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.15 **<u>Right to Lease</u>**. Landlord reserves the absolute right to effect such other tenancies in the Project as Landlord in the exercise of its sole business judgment shall determine to best promote the interests of the Building or Project. Tenant does not rely on the fact, nor does Landlord represent, that any specific tenant or type or number of tenants shall, during the Lease Term, occupy any space in the Building or Project.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.16 **<u>Force Majeure</u>**. Notwithstanding anything to the contrary contained in this Lease (but subject to the terms and conditions of this <u>Section</u> <u>29.16</u>), any prevention, delay or stoppage due to strikes, lockouts, labor disputes, acts of God, acts of war, terrorist acts, inability to obtain services, labor, or materials or reasonable substitutes therefor, governmental actions, civil commotions, Casualty, actual or threatened public health emergency (including, without limitation, epidemic, pandemic, famine, disease, plague, quarantine, and other significant public health risk), governmental edicts, actions, declarations or quarantines by a governmental entity or health organization (including, without limitation, any shelter-in-place orders, stay at home orders or any restrictions on travel related thereto that preclude Tenant, its agents, contractors or its employees from accessing the Premises, national or regional emergency), breaches in cybersecurity, and other causes beyond the reasonable control of the party obligated to perform, regardless of whether such other causes are (i) foreseeable or unforeseeable or (ii) related to the specifically enumerated events in this <u>Section</u> <u>29.16</u> (collectively, a "**Force Majeure**"), shall excuse the performance of such party for a period of time equal to any such prevention, delay or stoppage. If this Lease specifies a time period for performance of an obligation of either party, that time period shall be extended by the period of any delay in such party's performance caused by a Force Majeure. Notwithstanding the foregoing or anything to the contrary in this Lease, in no event shall Force Majeure: (a) excuse Tenant's obligations to pay Rent and other charges due pursuant to this Lease; (b) be grounds for Tenant to abate any portion of Rent due pursuant to this Lease, or entitle either party to terminate this Lease, except as allowed pursuant to <u>Articles 11</u> and <u>13</u> of this Lease; (c) excuse Tenant's obligations under <u>Section</u> <u>10.3</u> to carry the required insurance; or (d) extend the time period for Tenant to vacate the Premises following expiration of the Lease Term (unless physically impossible or legally prohibited, such as an inability to access the Premises for such purposes due to an earthquake and/or a legal 'stay at home' mandate). Without limiting the generality of the foregoing, Tenant agrees and acknowledges that events of Force Majeure may limit, interfere with, or prevent Tenant for using the Premises, and from entering the Premises. Tenant hereby waives any and all rights it might otherwise have pursuant to Section 1511 of the California Civil Code, and hereby agrees that this <u>Section</u> <u>29.16</u> is an express provision to the contrary. Tenant's agreement to the terms and conditions of this <u>Section</u> <u>29.16</u> is material consideration for Landlord's agreement to enter into this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.17 **<u>Waiver of Redemption by Tenant</u>**. Tenant hereby waives, for Tenant and for all those claiming under Tenant, any and all rights now or hereafter existing to redeem by order or judgment of any court or by any legal process or writ, Tenant's right of occupancy of the Premises after any termination of this Lease.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.18 **<u>Notices</u>**. All notices, demands, statements, designations, approvals or other communications (collectively, "**Notices**") given or required to be given by either party to the other hereunder or by law shall be in writing, shall be (A) sent by United States certified or registered mail, postage prepaid, return receipt requested ("**Mail**"), (B) delivered by a nationally recognized overnight courier, or (C) delivered personally. Any Notice shall be sent, transmitted, or delivered, as the case may be, to Tenant at the appropriate address set forth in <u>Section</u> <u>10</u> of the Summary, or to such other place as Tenant may from time to time designate in a Notice to Landlord, or to Landlord at the addresses set forth below, or to such other places as Landlord may from time to time designate in a Notice to Tenant. Any Notice will be deemed given (i) three (3) days after the date it is posted if sent by Mail, (ii) the date the telecopy is transmitted, (iii) the date the overnight courier delivery is made, or (iv) the date personal delivery is made. As of the Effective Date, any Notices to Landlord must be sent, transmitted, or delivered, as the case may be, to the following addresses:

HCP Oyster Point III LLC

c/o Healthpeak Properties, Inc.

1900 Main Street, Fifth Floor

Irvine, CA 92614

Attn: Legal Department

with a copy to:

Healthpeak Properties, Inc.

1900 Main Street, Fifth Floor

Irvine, CA 92614

Attention: Scott Bohn

and

Allen Matkins Leck Gamble Mallory & Natsis LLP

865 S. Figueroa Ave., Suite 2800

Los Angeles, California 90017

Attention: Steven Farenbaugh, Esq.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.19 **<u>Joint and Several</u>**. If the "Tenant" under this Lease is comprised of more than one legal entity and/or persons, then the obligations imposed upon Tenant under this Lease shall be joint and several.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.20 **<u>Authority</u>**. If Tenant is a corporation, trust, partnership, limited liability company or other legal entity, Tenant hereby represents and warrants that (i) Tenant is duly formed and in good standing in Tenant's state of organization, (ii) Tenant is qualified to do business in California, (iii) Tenant has full right and authority to execute and deliver this Lease, and (iv) each person signing on behalf of Tenant is authorized to do so. Tenant shall, within ten (10) days after Landlord's request, deliver to Landlord satisfactory written evidence of the truth and accuracy of the foregoing representations and warranties.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.21 **<u>Attorneys' Fees</u>**. In the event that either Landlord or Tenant should bring suit for the possession of the Premises, for the recovery of any sum due under this Lease, or because of the breach of any provision of this Lease or for any other relief against the other, then all costs and expenses, including reasonable attorneys' fees, incurred by the prevailing party therein shall be paid by the other party, which obligation on the part of the other party shall be deemed to have accrued on the date of the commencement of such action and shall be enforceable whether or not the action is prosecuted to judgment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.22 **<u>Governing Law; WAIVER OF TRIAL BY JURY; JUDICIAL REFERENCE</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.22.1 **<u>Governing Law</u>**. This Lease shall be construed and enforced in accordance with the laws of the State of California. In any action or proceeding arising herefrom, Landlord and Tenant hereby consent to (i) the jurisdiction of any competent court within the State of California, and (ii) service of process by any means authorized by California law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.22.2 **<u>WAIVER OF TRIAL BY JURY</u>**. IN THE INTEREST OF SAVING TIME AND EXPENSE, TRIAL WITHOUT A JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER OR THEIR SUCCESSORS IN RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM FOR INJURY OR DAMAGE, OR ANY EMERGENCY OR STATUTORY REMEDY. IN THE EVENT LANDLORD COMMENCES ANY SUMMARY PROCEEDINGS OR ACTION FOR NONPAYMENT OF BASE RENT OR ADDITIONAL RENT, TENANT SHALL NOT INTERPOSE ANY COUNTERCLAIM OF ANY NATURE OR DESCRIPTION (UNLESS SUCH COUNTERCLAIM SHALL BE MANDATORY) IN ANY SUCH PROCEEDING OR ACTION, BUT SHALL BE RELEGATED TO AN INDEPENDENT ACTION AT LAW.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.22.3 **<u>Judicial Reference</u>**. If the jury waiver provisions of this <u>Section</u> <u>29.22</u> are not enforceable under California law, then the following provisions shall apply. It is the desire and intention of the parties to agree upon a mechanism and procedure under which controversies and disputes arising out of this Lease or related to the Premises will be resolved in a prompt and expeditious manner. Accordingly, except with respect to actions for unlawful or forcible detainer or with respect to the prejudgment remedy of attachment, any action, proceeding or counterclaim brought by either party hereto against the other (and/or against its officers, directors, employees, agents or subsidiaries or affiliated entities) on any matters whatsoever arising out of or in any way connected with this Lease, Tenant's use or occupancy of the Premises and/or any claim of injury or damage, whether sounding in contract, tort, or otherwise, shall be heard and resolved by a referee under the provisions of the California Code of Civil Procedure, Sections 638 — 645.1, inclusive (as same may be amended, or any successor statute(s) thereto) (the "**Referee Sections**"). Any fee to initiate the judicial reference proceedings and all fees charged and costs incurred by the referee shall be paid by the party initiating such procedure (except that if a reporter is requested by either party, then a reporter shall be present at all proceedings where requested and the fees of such reporter – except for copies ordered by the other parties – shall be borne by the party requesting the reporter); provided however, that allocation of the costs and fees, including any initiation fee, of such proceeding shall be ultimately determined in accordance with <u>Section</u> <u>29.21</u> above. The venue of the proceedings shall be in the county in which the Premises are located. Within ten (10) days of receipt by any party of a written request to resolve any dispute or controversy pursuant to this <u>Section</u> <u>29.22</u>, the parties shall agree upon a single referee who shall try all issues, whether of fact or law, and report a finding and judgment on such issues as required

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by the Referee Sections. If the parties are unable to agree upon a referee within such ten (10) day period, then any party may thereafter file a lawsuit in the county in which the Premises are located for the purpose of appointment of a referee under the Referee Sections. If the referee is appointed by the court, the referee shall be a neutral and impartial retired judge with substantial experience in the relevant matters to be determined, from JAMS, the American Arbitration Association or similar mediation/arbitration entity. the proposed referee may be challenged by any party for any of the grounds listed in the Referee Sections. The referee shall have the power to decide all issues of fact and law and report his or her decision on such issues, and to issue all recognized remedies available at law or in equity for any cause of action that is before the referee, including an award of attorneys' fees and costs in accordance with this Lease. The referee shall not, however, have the power to award punitive damages, nor any other damages which are prohibited by the express provisions of this Lease, and the parties hereby waive any right to recover any such damages. The parties shall be entitled to conduct all discovery as provided in the California Code of Civil Procedure, and the referee shall oversee discovery and may enforce all discovery orders in the same manner as any trial court judge, with rights to regulate discovery and to issue and enforce subpoenas, protective orders and other limitations on discovery available under California law. The reference proceeding shall be conducted in accordance with California law (including the rules of evidence), and in all regards, the referee shall follow California law applicable at the time of the reference proceeding. The parties shall promptly and diligently cooperate with one another and the referee, and shall perform such acts as may be necessary to obtain a prompt and expeditious resolution of the dispute or controversy in accordance with the terms of this <u>Section</u> <u>29.22</u>. In this regard, the parties agree that the parties and the referee shall use best efforts to ensure that (a) discovery be conducted for a period no longer than six (6) months from the date the referee is appointed, excluding motions regarding discovery, and (b) a trial date be set within nine (9) months of the date the referee is appointed. In accordance with Section 644 of the California Code of Civil Procedure, the decision of the referee upon the whole issue must stand as the decision of the court, and upon the filing of the statement of decision with the clerk of the court, or with the judge if there is no clerk, judgment may be entered thereon in the same manner as if the action had been tried by the court. Any decision of the referee and/or judgment or other order entered thereon shall be appealable to the same extent and in the same manner that such decision, judgment, or order would be appealable if rendered by a judge of the Superior Court in which venue is proper hereunder. The referee shall in his/her statement of decision set forth his/her findings of fact and conclusions of law. the parties intend this general reference agreement to be specifically enforceable in accordance with the Code of Civil Procedure. Nothing in this <u>Section</u> <u>29.22</u> shall prejudice the right of any party to obtain provisional relief or other equitable remedies from a court of competent jurisdiction as shall otherwise be available under the code of civil procedure and/or applicable court rules.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.23 **<u>Submission of Lease</u>**. Submission of this instrument for examination or signature by Tenant does not constitute a reservation of, option for or option to lease, and it is not effective as a lease or otherwise until execution and delivery by both Landlord and Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.24 **<u>Brokers</u>**. Landlord and Tenant hereby warrant to each other that they have had no dealings with any real estate broker or agent in connection with the negotiation of this Lease, excepting only the real estate brokers or agents specified in <u>Section</u> <u>12</u> of the Summary (the "**Brokers**"), and that they know of no other real estate broker or agent who is entitled to a commission in connection with this Lease. Each party shall indemnify and defend the other party

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against and hold the other party harmless from any and all Losses with respect to any leasing commission or equivalent compensation alleged to be owing on account of any dealings with any real estate broker or agent, other than the Brokers, occurring by, through, or under the indemnifying party. The terms of this <u>Section</u> <u>29.24</u> shall survive the expiration or earlier termination of the Lease Term. Landlord shall pay the brokerage commissions owing to the Brokers in connection with this Lease pursuant to the terms of a separate written agreement between and/or among Landlord and the Brokers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.25 **<u>Independent Covenants</u>**. This Lease shall be construed as though the covenants herein between Landlord and Tenant are independent and not dependent and Tenant hereby expressly waives the benefit of any statute to the contrary and agrees that if Landlord fails to perform its obligations set forth herein, Tenant shall not be entitled to make any repairs or perform any acts hereunder at Landlord's expense or to any setoff of the Rent or other amounts owing hereunder against Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.26 **<u>Project or Building Name, Address and Signage</u>**. Landlord shall have the right at any time to change the address or name of the Project or Building and to install, affix and maintain any and all signs on the exterior and on the interior of the Project or Building as Landlord may, in Landlord's sole discretion, desire. Tenant shall not use the name of the Project or Building, or the name or logo of Landlord (or any of its affiliates), or use pictures or depictions of the Project or Building, in advertising or other publicity (including, without limitation, any websites or social media accounts) or for any purpose, without the prior written consent of Landlord. Notwithstanding the foregoing, Tenant may use the name of the Building and Project as an element of Tenant's address with respect to the business to be conducted by Tenant in the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.27 **<u>Counterparts</u>**. This Lease may be executed in counterparts with the same effect as if both parties hereto had executed the same document. Both counterparts shall be construed together and shall constitute a single lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.28 **<u>Confidentiality</u>**. Tenant acknowledges that the content of this Lease and any related documents are confidential information. Landlord and Tenant shall keep such information strictly confidential and shall not disclose such confidential information to any person or entity other than (i) such party's respective financial, legal, space planning and construction consultants and other advisors, and such party's parent, subsidiary or other affiliated companies, their partners, prospective and actual lenders, banks and investors, auditors, underwriters, and attorneys and similar professionals, (ii) as may be required to enforce the provisions of this Lease, or (iii) as may be required to comply with Applicable Laws. In addition, notwithstanding the foregoing or anything to the contrary herein, Landlord shall be entitled to (a) disclose information relating to this Lease to the extent necessary to comply with the disclosure or regulatory requirements of the S.E.C., IRS or similar entities, or in connection with other S.E.C., IRS or other regulatory filings customarily made by publicly traded REIT entities; (b) disclose information relating to this Lease on earnings calls and/or at investor meetings as customarily disclosed by publicly traded REIT entities or consistent with past practices, and (c) issue press releases with respect to the fact that this Lease has been entered into, the size and location of the Premises, the length of term, and the identity of Tenant (among other information commonly found in press releases announcing new lease transactions).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.29 **<u>Development of the Project</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.29.1 **<u>Subdivision</u>**. Landlord reserves the right to subdivide all or a portion of the Project, buildings and Common Areas. Tenant agrees to execute and deliver, upon demand by Landlord and in the form requested by Landlord, any additional commercially reasonable documents needed to conform this Lease to the circumstances resulting from a subdivision and any all maps in connection therewith. Notwithstanding anything to the contrary set forth in this Lease, the separate ownership of portions of the Project, or any buildings and/or Common Areas, by an entity other than Landlord shall not affect the calculation of Direct Expenses or Tenant's payment of Tenant's Share of Direct Expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.29.2 **<u>Construction of Property and Other Improvements</u>**. Tenant acknowledges that (i) portions of the Project may be under construction following Tenant's occupancy of the Premises, including the construction of additional Project buildings, parking areas and structures, and other improvements, and (ii) that such construction may result in levels of noise, dust, obstruction of access, etc. which are substantially in excess of that present in a fully constructed project, including erecting scaffolding or other necessary structures in the Project, and limiting or eliminating access to portions of the Project, including portions of the Common Areas; provided, that, Tenant's access to and use of the Premises for the Permitted Use (and parking areas for Tenant's parking rights hereunder) are not materially adversely affected. Tenant hereby waives any and all rent offsets or claims of constructive eviction which may arise in connection with such construction, and further waives any Losses for any injuries or inconvenience to or interference with Tenant's business, lost profits, any loss of occupancy or quiet enjoyment of the Premises, and any other loss occasioned by such work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.30 **<u>No Violation</u>**. Tenant hereby warrants and represents that neither its execution of nor performance under this Lease shall cause Tenant to be in violation of any agreement, instrument, contract, law, rule or regulation by which Tenant is bound, and Tenant shall protect, defend, indemnify and hold Landlord harmless from and against any Losses arising from Tenant's breach of this warranty and representation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.31 **<u>Transportation Management</u>**. Tenant shall fully comply with all present or future programs intended to manage parking, transportation or traffic in and around the Project and/or the Building, and in connection therewith, Tenant shall take responsible action for the transportation planning and management of all employees located at the Premises by working directly with Landlord, any governmental transportation management organization or any other transportation-related committees or entities. Such programs may include, without limitation: (i) restrictions on the number of peak-hour vehicle trips generated by Tenant; (ii) increased vehicle occupancy; (iii) implementation of an in-house ridesharing program and an employee transportation coordinator; (iv) working with employees and any Project, Building or area-wide ridesharing program manager; (v) instituting employer-sponsored incentives (financial or in-kind) to encourage employees to rideshare; and (vi) utilizing flexible work shifts for employees.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.32 **<u>Prohibited Persons; Foreign Corrupt Practices Act and Anti-Money Laundering</u>**. Tenant hereby represents and warrants to Landlord that neither Tenant nor any of its affiliates, nor any of their respective members, partners or other equity holders, and none of their respective officers, directors or managers is, nor prior to or during the Lease Term, will become a person or entity with whom U.S. persons or entities are restricted from doing business under (a) the Patriot Act (as defined below), (b) any other requirements contained in the rules and regulations of the Office of Foreign Assets Control, Department of the Treasury ("**OFAC**") (including any "blocked" person or entity listed in the Annex to Executive Order Nos. 12947, 13099 and 13224 and any modifications thereto or thereof or any other person or entity named on OFAC's Specially Designated Blocked Persons List) or (c) any other U.S. statute, Executive Order (including the September 24, 2001, Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit or Support Terrorism) or other governmental action (collectively, "**Prohibited Persons**"). Tenant further represents and warrants to Landlord that Tenant and its employees and all persons acting on its behalf have at all times fully complied with, and are currently in full compliance with, the Foreign Corrupt Practices Act of 1977 and any other applicable anti-bribery or anti-corruption laws. Tenant is not entering into this Lease, directly or indirectly, in violation of any laws relating to drug trafficking, money laundering or predicate crimes to money laundering. As used herein, "**Patriot Act**" shall mean the USA Patriot Act of 2001, 107 Public Law 56 (October 26, 2001) and all other statutes, orders, rules and regulations of the U.S. government and its various executive departments, agencies and offices interpreting and implementing the Patriot Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.33 **<u>Signatures</u>**. The parties hereto consent and agree that this Lease may be signed and/or transmitted by facsimile, e-mail of a .pdf document or using electronic signature technology (e.g., via DocuSign or similar electronic signature technology), and that such signed electronic record shall be valid and as effective to bind the party so signing as a paper copy bearing such party's handwritten signature. The parties further consent and agree that (1) to the extent a party signs this Lease using electronic signature technology, by clicking "SIGN", such party is signing this Lease electronically, and (2) the electronic signatures appearing on this Lease shall be treated, for purposes of validity, enforceability and admissibility, the same as handwritten signatures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.34 **<u>Landlord's Representations</u>**. Landlord hereby represents and warrants to Tenant that as of the date of Landlord's execution of this Lease: (i) Landlord holds fee simple title to the Project, and the Project is not currently subject to any ground lease, or to the lien of any mortgage or deed of trust; (ii) Landlord has full power and authority to enter into this Lease and has obtained all consents necessary in connection therewith; and (iii) as of the Delivery Date, no other party will have any possessory rights to the Premises (and none have currently claimed the same).

**[SIGNATURES CONTAINED ON FOLLOWING PAGE]** 

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IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed as of the Effective Date.

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| | | | |
|:---|:---|:---|:---|
| LANDLORD: | LANDLORD: | TENANT | TENANT |
| **HCP OYSTER POINT III, LLC**,<br> a Delaware limited liability company | **HCP OYSTER POINT III, LLC**,<br> a Delaware limited liability company | **ENCARDA, INC.,**<br> **a Delaware corporation** | **ENCARDA, INC.,**<br> **a Delaware corporation** |
| By: | /s/ Scott Bohn | By: | /s/ Tassos Gianakakos |
|  | Name: Scott Bohn |  | Name: Tassos Gianakakos |
|  | Its: Chief Development Officer |  | Its: Chief Executive Officer, Chair |
|  |  | By: |  |
|  |  |  | Name:<u> </u> |
|  |  |  | Its: |

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**<u>EXHIBIT A</u>**

**<u>THE COVE</u>**

**<u>OUTLINE OF PREMISES</u>**

![LOGO](g107928g0319083952577.jpg)

EXHIBIT A

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**<u>EXHIBIT A-1</u>**

**<u>THE COVE</u>**

**<u>PROJECT SITE PLAN</u>**

![LOGO](g107928g0319083953156.jpg)

EXHIBIT A-1

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**<u>EXHIBIT B</u>**

**<u>THE COVE</u>**

**<u>TENANT WORK LETTER</u>**

This Tenant Work Letter shall set forth the terms and conditions relating to the construction of the improvements in the Premises. This Tenant Work Letter is essentially organized chronologically and addresses the issues of the construction of the Premises, in sequence, as such issues will arise during the actual construction of the Premises. All references in this Tenant Work Letter to Articles or Sections of "this Lease" shall mean the relevant portion of <u>Articles 1</u> through <u>29</u> of this Lease, and all references in this Tenant Work Letter to Sections of "this Tenant Work Letter" shall mean the relevant portion of <u>Sections 1</u> through <u>6</u> of this Tenant Work Letter.

**<u>SECTION 1</u>**

**<u>LANDLORD'S DELIVERY WORK; TENANT IMPROVEMENTS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>**Landlord's Delivery Work**</u>. Notwithstanding <u>Section</u> <u>1.1.1</u> of the Lease to the contrary, Landlord shall, at Landlord's cost on a turn-key basis (subject to the terms of this Tenant Work Letter), using Building standard materials and in accordance with Building standards, perform that certain work and improvements to the Premises as described and/or depicted on **<u>Schedule 1</u>** attached hereto (collectively, "**Landlord's Delivery Work**"). Landlord's Delivery Work shall be performed by Landlord in a good and workmanlike manner and in compliance with all Applicable Laws. For purposes hereof, Landlord's Delivery Work shall be deemed "Substantially Completed" and "Substantial Completion of Landlord's Delivery Work" shall occur upon (i) the completion of Landlord's Delivery Work in accordance with the provisions of this <u>Section</u> <u>1.1</u>, Delivery Punch List Items (as defined hereinbelow) excepted (which Delivery Punch List Items shall be subsequently performed as set forth hereinbelow), and (ii) the issuance by the applicable governmental authority of a certificate of occupancy or the equivalent in the jurisdiction that the Project is located, if applicable, permitting occupancy of the Premises (which, for purposes of clarification, due to the minor scope of Landlord's Delivery Work, may be a pre-existing certificate of occupancy or equivalent). If Landlord shall encounter any delays in causing Landlord's Delivery Work to be Substantially Completed as a result of any acts or omissions of Tenant, or its agents, contractors, employees, licensees or invitees (collectively, "**Tenant Delivery Work Delays**"), then, notwithstanding anything to the contrary set forth in this Lease and regardless of the actual date Landlord's Delivery Work is Substantially Completed, the Lease Commencement Date shall be deemed to be the date the Lease Commencement Date would have occurred if no such Tenant Delivery Work Delays, as set forth above, had occurred. For purposes of this <u>Section</u> <u>1.1</u>, Tenant shall submit to Landlord a list of minor unfinished work (<u>i.e.</u>, items which do not materially and adversely interfere with Tenant's use and occupancy of the Premises for the Permitted Use) (the "**Delivery Punch List Items**") on or before the date that is five (5) business days following the date of Substantial Completion of Landlord's Delivery Work. If Tenant fails to timely deliver the Delivery Punch List Items to Landlord, then Tenant shall have waived its right to deliver the Delivery Punch List Items and Landlord's Delivery Work shall be deemed to be complete with Landlord having no further obligations with respect to Landlord's Delivery Work. After approval by Landlord of the Delivery Punch List Items, the items of work set forth therein will be diligently completed by Landlord, with commercially reasonable efforts to complete the same within thirty (30) days.

EXHIBIT B

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 **<u>Tenant Improvements</u>**. Separate and apart from Landlord's Delivery Work, and not a condition to the occurrence of the Lease Commencement Date under the Lease, using Building standard materials, components and finishes, Landlord shall, at Landlord's cost on a turn-key basis (subject to the terms of this Tenant Work Letter), cause the installation and/or construction of those certain items identified on the "Approved Space Plan," defined below (the "**Tenant Improvements**"). The term "**Approved Space Plan**" shall mean that certain space plan and scope of work list approved by Landlord and Tenant, which Approved Space Plan is attached hereto as **<u>Schedule 2</u>**. Immediately upon the full execution and delivery of this Lease, Tenant shall cooperate in good faith with Landlord's architects and engineers to supply the necessary information, if any, required to allow the Landlord's architects and engineers to complete any additional architectural and engineering drawings for the Premises in a form which is complete to allow subcontractors to bid on the work and to obtain all applicable permits and in a manner consistent with the Approved Space Plan (the "**Approved Working Drawings**"). Tenant shall timely comply with the applicable milestones set forth in the construction schedule set forth on **<u>Schedule 5</u>** attached hereto (the "**Tenant Milestone Schedule**"). Tenant shall make no changes, additions or modifications to the Tenant Improvements or the Approved Space Plan without the prior written consent of Landlord, except in accordance with and subject to the terms and conditions of Section 1.3 below. Notwithstanding any provision to the contrary set forth in this Lease or this Tenant Work Letter, Tenant shall be solely responsible, at Tenant's sole cost and expense, for acquisition and installation of all data and telephone cabling, furniture, fixtures and equipment for the Premises. The Tenant Improvements shall be performed by Landlord in a good and workmanlike manner, in compliance with all Applicable Laws and using commercially reasonable efforts to avoid material, unreasonable interference with Tenant's operations for the Permitted Use in the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 **<u>Tenant Change Request</u>**. If Tenant at any time desires any changes, alterations or additions to the Approved Working Drawings (including, without limitation, with respect to any items not identified on the Approved Space Plan and/or any items requiring other than Building standard materials, components or finishes), Tenant shall submit a detailed written request to Landlord and the Project Managers specifying such changes, alterations or additions (a "**Tenant Change Request**"). Upon receipt of any such request, Landlord shall promptly notify Tenant (<u>i.e.</u>, within seven [7] business days) of (A) whether the matters proposed in the Tenant Change Request are approved by Landlord (which approval shall not be unreasonably withheld, conditioned or delayed by Landlord), (B) Landlord's estimate of the number of days of delay, if any, which would be caused in the Substantial Completion of the Tenant Improvements if such Tenant Change Request were implemented (including, without limitation, delays due to the need to obtain any revised plans or drawings, revised pricing, and any governmental approvals), which estimation of delays shall include a good faith and reasonable coordination with the Contractor to formally evaluate and estimate such delays to the previous schedule, and (C) Landlord's estimate of the net increase, if any (accounting for the delta/increase between any previous replaced/changed components, as opposed to the entirety of any replacement/changed component costs), in the TI Costs that would result if such Tenant Change Request were implemented (including, but not limited to, any costs of design, permitting, and compliance with laws or governmental regulations

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that become applicable because of the implementation of the Tenant Change Request), which estimation of such increase in TI Costs shall include a good faith and reasonable coordination with the Contractor to formally evaluate and estimate such cost increases to the previous budget (the "**Tenant Change Request Notice"**). After receipt of the Tenant Change Request Notice, Tenant shall have three (3) business days to notify Landlord that it elects to proceed with the Tenant Change Request, and that Tenant approves and agrees to be responsible for the actual delays and cost increases, if any, directly resulting from such Tenant Change Request (regardless of whether such delays or costs exceed the estimates in the Tenant Change Request Notice) (the "**Tenant Change Authorization**"). Following receipt of the Tenant Change Authorization, subject to Tenant's payment of the Change Order Costs pursuant to Section 2.2 below, Landlord shall cause such Tenant Change Request to be implemented and Tenant shall be responsible for all actual costs or cost increases resulting from or attributable to the implementation of the Tenant Change Request (collectively, "**Change Order Costs**"), and any delays resulting therefrom shall be deemed to be a Tenant Delay; provided, however, in the course of such construction, Landlord shall use commercially reasonable and good faith efforts to keep Tenant apprised of any cost overruns by the Contractor, if any (in excess of the estimate under clause (C) hereinabove), and coordinate with Tenant and Contractor to potentially value engineer and/or otherwise reasonably address modification of the subject Tenant Change Request to potentially reduce and/or eliminate such overruns (it being understood and agreed that Tenant is still responsible for all Change Order Costs and for any delays resulting from such potential modification or value engineering process as a Tenant Delay). The design, permitting and construction work specifically pertaining to any Tenant Change Request so authorized and implemented is sometimes referred to as "**Approved Change Order Work**". If Tenant fails to provide the Tenant Change Authorization within such three (3) business day period, then such Tenant Change Request shall be deemed to be withdrawn and shall be of no further effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 **<u>Building Standards</u>**. Landlord has established or may establish specifications for certain Building standard components to be used in the construction of the "Tenant Improvements" (as that term is defined above) in the Premises, which Building standards have been provided to Tenant prior to the date of this Lease in writing. The quality of the Tenant Improvements shall be materially consistent with the quality of such Building standards, provided that Landlord may, at Landlord's option, require the Tenant Improvements to comply with certain Building standards. Landlord may make commercially reasonable changes to said specifications for Building standards from time to time.

**<u>SECTION 2</u>**

**<u>COSTS OF TENANT IMPROVEMENTS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 **<u>TI Costs</u>**. Landlord, at Landlord's sole cost and expense, shall be responsible for the costs of the design, permitting, project management and construction of the Tenant Improvements (collectively, the "**TI Costs**"), which Landlord shall pay on a progress payment basis during the course of the design and construction of the Tenant Improvements in accordance with Landlord's standard draw cycle and disbursement procedures and requirements (which procedures and requirements include, without limitation, Landlord's receipt of requests for payment and invoices from the architects, engineers, contractors, subcontractors and other persons or entities performing the Tenant Improvements and executed mechanics' lien releases from all such persons and entities, all as reasonably satisfactory to Landlord).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 **<u>Change Order Costs</u>**. Notwithstanding <u>Section</u> <u>2.1</u> above, subject to Tenant's potential election to use all or any portion of the Special Allowance pursuant to <u>Section</u> <u>2.3</u> below, Tenant, at Tenant's sole cost, shall pay for all Change Order Costs (if any), which payment shall be made to Landlord as follows: (i) prior to the date upon which Landlord commences performance of any Approved Change Order Work, Landlord shall deliver to Tenant a written estimate of the total Change Order Costs (the "**Estimated Change Order Costs**"); (ii) Tenant shall provide the amount set forth in such estimate to Landlord in cash within five (5) business days after Tenant's receipt of such written estimate. Landlord shall use the Estimated Change Order Costs paid by Tenant to pay for the applicable Change Order Costs as a part of the progress payment logistics under Section 2.1 above. Notwithstanding the foregoing, if the then existing Estimated Change Order Costs, if any, are re-estimated and increased in excess of fifteen percent (15%) by Landlord acting in good faith from time to time during the design, permitting and construction of the Approved Change Order Work, then Tenant shall pay such revised Estimated Change Order Costs to Landlord (that are not funded from the Special Allowance) within ten (10) days after Tenant's receipt of written invoice therefor. Following the date the Tenant Improvements are Substantially Completed, Landlord shall provide Tenant with a written reconciliation of the actual total Change Order Costs as compared to the Estimated Change Order Costs previously paid by Tenant, and subject to Tenant's rights under <u>Section</u> <u>2.3</u> below with respect to the Special Allowance, Tenant shall pay to Landlord any underpayment of the Change Order Costs made by Tenant, or Landlord shall reimburse to Tenant any overpayment of the Change Order Costs made by Tenant, as the case may be, within thirty (30) days after Landlord's delivery of such written reconciliation to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 **<u>Special Allowance</u>**. Tenant shall have the right, by written notice to Landlord given at any time prior to the Outside Special Allowance Election Date (as defined below), to use up to, but not exceeding $718,860.00 (<u>i.e.</u>, $20.00 per rentable square foot of the Premises) (the "**Special Allowance**") towards the payment of any of the following (collectively, the "**Special Allowance Permissible Costs**"): (i) the Change Order Costs (including as Estimated Change Order Costs); (ii) the costs of any approved modifications to the Landlord's Delivery Work (which modifications, themselves, remain subject to Landlord's approval, in Landlord's sole and absolute discretion); and/or (iii) the costs of any other Alterations (that are permanently affixed to the Premises) approved by Landlord under the Lease and completed by or on behalf of Tenant on or before the Outside Special Allowance Election Date, if any. On or prior to the date that is twelve (12) months after the Lease Commencement Date (the "**Outside Special Allowance Election Date**"), Tenant shall notify Landlord in writing (the "**Special Allowance Election Notice**"), which notice shall be in the form attached hereto as **<u>Schedule 3</u>**, of the amounts, if any, of the Special Allowance that Tenant desires to utilize in accordance with the terms of this <u>Section</u> <u>2.3</u> (the "**Elected Special Allowance"**). In the event Tenant timely exercises its right to use all or any portion of the Special Allowance, Tenant shall be required to pay Landlord, commencing on the date (the "**Special Allowance Payment Commencement Date**") that is the earlier to occur of (A) the date that the Tenant Improvements are completed, and (B) the date immediately following the Outside Special Allowance Election Date, the "Special Allowance Payment," as that term is defined below, in consideration of Landlord provision of the Special Allowance. The "**Special** 

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 **Allowance Payment**" shall be determined as the missing component of an annuity, which annuity shall have (1) the amount of the Elected Special Allowance as the present value amount, (2) a number equal to the number of full calendar months then remaining in the Lease Term as the number of payments, (3) a monthly interest factor equal to 0.8334%, which is equal to ten percent (10%) divided by twelve (12) months per year, and (4) the Special Allowance Payment as the missing component of the annuity, and shall not be subject to annual escalations. Following the calculation of the total Special Allowance Payment, Landlord and Tenant will enter into a lease amendment in the form attached hereto as **<u>Schedule 4</u>**, to confirm the amount thereof (the "**Special Allowance Amendment**"). If Tenant fails to provide the Special Allowance Election Notice to Landlord on or before the Outside Special Allowance Election Date, Tenant shall have no further right to any Special Allowance.

If Tenant timely elects for all or any portion of the Special Allowance to be used towards the Change Order Costs under this Tenant Work Letter, Landlord shall disburse the same as a part of the progress payment logistics under Section 2.1 above.

Notwithstanding the foregoing, if at the time Tenant timely delivers any Special Allowance Election Notice to Landlord electing to use any Special Allowance towards the payment of all or any portion of the Change Order Costs, the parties shall reconcile any then-held Estimated Change Order Costs by Landlord that were previously paid by Tenant (if any), such that: (y) Landlord will return any applicable amounts of such then-held Estimated Change Order Costs to Tenant (in the corresponding amount of the applicable Elected Special Allowance); and (z) the required Estimated Change Order Costs to be paid to Landlord (and reconciliation of the Estimated Changed Order Costs and actual Change Order Costs after completion of the Tenant Improvements under <u>Section</u> <u>2.2</u> above) shall account for such designated Elected Special Allowance.

For purposes of clarification: (I) it is the parties intention that Tenant deliver the Special Allowance Election Notice to Landlord at the time Tenant would otherwise first pay the Estimated Change Order Costs to Landlord under <u>Section</u> <u>2.2</u> above, providing Landlord with clarity on the funds to use from the Special Allowance for such Change Order Costs and the funds to be collected from Tenant if any remaining Estimated Change Order Costs; and (II) however, if Tenant does not provide the Special Allowance Election Notice to Landlord at such point(s) in time, Tenant does not lose the right to later provide the Special Allowance Election Notice to Landlord as set forth hereinabove and, if applicable, reconcile such previously delivered Estimated Change Order Costs.

**<u>SECTION 3</u>**

**<u>CONTRACTOR'S WARRANTIES AND GUARANTIES</u>**

Landlord hereby non-exclusively assigns to Tenant all warranties and guaranties by the contractor who constructs the Tenant Improvements (the "**Contractor**") relating to the Tenant Improvements (provided that Landlord reserves all rights in connection with such warranties and guaranties by the Contractor), and Tenant hereby waives all claims against Landlord relating to or arising out of the design and construction of the Tenant Improvements that are covered within the scope of such warranties and guaranties. The Contractor's warranty for the Tenant Improvements (and the applicable contractor warranty for the applicable components of Landlord's Delivery Work, as the case may be) shall extend for at least one (1) year from completion.

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**<u>SECTION 4</u>**

**<u>TENANT'S AGENTS</u>**

Tenant hereby protects, defends, indemnifies and holds Landlord harmless for any loss, claims, damages or delays arising from the actions of Tenant's space planner/architect and/or any of the following engaged by Tenant: separate contractors, subcontractors or consultants on the Premises or in the Building.

**<u>SECTION 5</u>**

**<u>COMPLETION OF THE TENANT IMPROVEMENTS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 **<u>Completion</u>**. The completion of the Tenant Improvements shall not be a required component of and/or condition to the occurrence of the Lease Commencement Date under the Lease; provided, however, Landlord shall use commercially reasonable and diligent efforts to promptly commence and complete design and construction of the same following the Lease Commencement Date. However, for purposes of this Lease, the Tenant Improvements shall be deemed to be "substantially completed" (herein referred to as "**Substantial Completion**" or "**Substantially Complete"**) when all major construction of the Tenant Improvements is completed pursuant to the Approved Working Drawings (subject to the terms of <u>Section</u> <u>5.2</u>, below), specifically excluding (i) minor, "punch list" items which do not materially interfere with Tenant's use and occupancy of the Premises, (ii) any tenant fixtures, work-stations (including any related fixture and/or equipment electrification), built-in furniture, or laboratory or other equipment (including security and other Tenant systems) to be installed by Tenant or under the supervision of Contractor, and (iii) the installation of the glasswash component of the Tenant Improvements (due to the same being a long lead-time item, and which, if not completed by Substantial Completion, shall thereafter be diligently completed by Landlord). Based on the Approved Space Plan, Landlord currently anticipates that Substantial Completion of the Tenant Improvements will occur on April 18, 2025 (the "**Anticipated TI Completion Date**"). If Landlord does not cause Substantial Completion of the Tenant Improvements to occur on or before the Anticipated TI Completion Date (or any other particular date), then, except as expressly set forth in <u>Section</u> <u>1.1.1.3</u> of the Lease, Landlord shall not be subject to any liability nor shall the validity of this Lease nor the obligations of Tenant hereunder be affected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 **<u>Delay of the Substantial Completion of the Tenant Improvements</u>**. For purposes of this Lease and Tenant Work Letter (including, without limitation, <u>Section</u> <u>1.1.1.3(b)</u> of this Lease), a "**Tenant TI Delay"** shall mean the occurrence of any of the following to the extent actually causing a delay in Substantial Completion:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.1 Tenant's failure to timely (<u>i.e.</u>, within the time period provide for in this Lease for Tenant's approval) approve any matter requiring Tenant's approval, including a failure to comply with the Tenant Milestone Schedule;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.2 A breach by Tenant of the terms of this Tenant Work Letter or this Lease;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.3 Tenant Change Requests and Tenant's request for changes in the Approved Space Plan, the Tenant Improvements, or, once completed, the Approved Working Drawings, or Tenant's request for changes which cause the Approved Working Drawings to not be a logical extension of or consistent with the Approved Space Plan;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.4 Tenant's requirement for materials, components, finishes or improvements (each, a "Long- Lead Item") which are (A) not available in a commercially reasonable time given the anticipated date of Substantial Completion of the Premises, as set forth in the Lease, or (B) are different from, or not included in, Landlord's Building standards; provided, however, no such Tenant Delay shall occur under this <u>Section</u> <u>5.2.4</u> unless and until (1) Landlord notifies Tenant of the potential delay resulting from any such Long-Lead Item, and (2) Tenant fails to deliver specific proposed changes to the Construction Drawings to Landlord (subject to Landlord's reasonable approval thereof) that eliminate such Long-Lead Item within two (2) business days after Tenant's receipt of such notice (provided, however, notwithstanding the foregoing, to the extent any materials, components, finishes or improvements are set forth on the Approved Space Plan, no such Tenant Delay shall occur under this <u>Section</u> <u>5.2.4</u> with respect thereto);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.5 Changes to the base, shell and core work of the Building required by the Approved Working Drawings that are not set forth on the Approved Space Plan; provided, however: (A) if Landlord has actual knowledge of any such required changes which would constitute a Tenant Delay pursuant to this <u>Section</u> <u>5.2.5</u>, but fails to notify Tenant thereof within three (3) business days after Landlord first obtains such actual knowledge, such Landlord-known required changes shall not constitute a Tenant Delay pursuant to this clause (v) until (1) Landlord notifies Tenant thereof (such notice shall include Landlord's good faith, non-binding estimate of the anticipated length of such resulting delays), and (2) Tenant fails to deliver specific proposed changes to the Construction Drawings to Landlord (subject to Landlord's reasonable approval thereof) that eliminate such required changes within two (2) business days after Tenant's receipt of such notice; and (B) if any such changes are expressly set forth in the Approved Space Plan, such changes shall not constitute a Tenant Delay pursuant to this <u>Section</u> <u>5.2.5</u>; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.6 Delays in obtaining a certificate of occupancy, temporary certificate of occupancy, or final permit sign off by appropriate municipal authorities to the extent due to the Tenant's failure to complete any tenant fixtures, work-stations (including any related fixture and/or equipment electrification), built-in furniture, or equipment (including security and other Tenant systems) to be installed by Tenant; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2.9 Any other acts or omissions of Tenant, or its agents, or employees, including, without limitation, failure or delay beyond the period provided for in this Tenant Work Letter, to consult with Landlord or attend meetings or return emails or telephone calls or to respond to other correspondence from Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 **<u>Acceptance of Inconveniences</u>**. The parties hereby agree that the Tenant Improvements (including any Punch-List Work under <u>Section</u> <u>5.4</u> below) will be performed during Tenant's occupancy of the Premises, and in connection therewith, Tenant hereby acknowledges and agrees: (i) to accept any and all inconveniences associated with the performance of the Tenant Improvements which may occur during such occupancy including, without limitation, dust, noise,

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etc.; (ii) that the performance of the Tenant Improvements shall in no way constitute a constructive eviction of the Tenant under the Lease nor entitle Tenant to any abatement of rent payable pursuant to the Lease; and (iii) Landlord shall not be liable to Tenant for, and Tenant shall not be entitled to any compensation or damages from Landlord for, loss of the use of all or any part of the Premises or of any personal property or improvements therein resulting from the performance of the Tenant Improvements, or for any inconvenience or annoyance occasioned thereby or for any injury to or interference with Tenant's business, except for any injury to persons or damage to property (but not loss of or interference with business or other consequential damages) to the extent caused by Landlord's gross negligence or intentional misconduct and not insured or required to be insured by Tenant under the Lease. In the performance of the Tenant Improvements, Landlord will use commercially reasonable efforts to not unreasonably and materially interfere with Tenant's operations for the Permitted Use in the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 **<u>Tenant Improvements Punch List</u>**. Tenant shall submit to Landlord a list of minor unfinished work for the Tenant Improvements (the "**Punch List**") on or before the date that is five (5) business days following the date of Substantial Completion of the Tenant Improvements. If Tenant fails to timely deliver the Punch List to Landlord, then Tenant shall have waived its right to deliver the Punch List and the Premises shall be deemed to be complete with Landlord having no further obligations with respect to the Premises. Aft er approval by Landlord of the Punch List, the items of work set forth therein will be diligently completed by Landlord.

**<u>SECTION 6</u>**

**<u>MISCELLANEOUS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 **<u>Tenant's Representative</u>**. Tenant has designated Oliver Sjahsam as its sole representative with respect to the matters set forth in this Tenant Work Letter (whose e-mail address for the purposes of this Tenant Work Letter is [\*\*\*<u>]</u>), who, until further notice to Landlord, shall have full authority and responsibility to act on behalf of the Tenant as required in this Tenant Work Letter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 **<u>Landlord's Representatives; Project Management</u>**. As used herein, the "**Project Manager(s)**" shall mean Project Management Advisors, Inc. ("**PMA**"), or any other project manager designated by Landlord in its reasonable discretion from time to time to act in a supervisory, oversight, project management or other similar capacity on behalf of Landlord in connection with the design and/or construction of the Tenant Improvements. Unless and until revoked by Landlord by written notice delivered to Tenant, Landlord hereby (i) delegates to Project Manager the authority to exercise all approval rights, supervisory rights and other rights or powers of Landlord under this Tenant Work Letter with respect to the design and construction of the Tenant Improvements, and (ii) requests that Tenant work with Project Manager with respect to any logistical or other coordination matters arising in the course of construction of the Tenant Improvements, including monitoring Tenant's compliance with its obligations under this Tenant Work Letter and under the Lease with respect to the design and construction of the Tenant Improvements. Tenant acknowledges the foregoing delegation and request, and agrees to cooperate reasonably with Project Manager as Landlord's representative pursuant to such delegation and request. Fees and charges of Project Manager for such services shall be at Tenant's sole expense, subject to Landlord's payment of the Special Allowance.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 **<u>Tenant's Agents</u>**. All subcontractors, laborers, materialmen, and suppliers retained directly by Tenant shall all be union labor in compliance with the master labor agreements existing between trade unions and the Northern California Chapter of the Associated General Contractors of America.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 **<u>Time of the Essence in This Tenant Work Letter</u>**. Unless otherwise indicated, all references herein to a "number of days" shall mean and refer to calendar days. In all instances where Tenant is required to approve or deliver an item (including as set forth on the Tenant Milestone Schedule), if no written notice of approval is given or the item is not delivered within the stated time period, at Landlord's sole option, at the end of such period the item shall automatically be deemed approved or delivered by Tenant and the next succeeding time period shall commence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6 **<u>Tenant's Lease Default</u>**. Notwithstanding any provision to the contrary contained in this Lease or this Tenant Work Letter, if any Event of Default by Tenant under this Lease or this Tenant Work Letter (including, without limitation, any failure by Tenant to fund in advance the Estimated Change Order Costs) occurs, then (i) in addition to all other rights and remedies granted to Landlord pursuant to this Lease, Landlord shall have the right to cause the cessation of construction of the Tenant Improvements and any other work required to be performed by Landlord pursuant to this Tenant Work Letter (in which case, Tenant shall be responsible for any delay and any costs occasioned thereby), and (ii) all other obligations of Landlord under the terms of this Tenant Work Letter shall be forgiven until such time as such default is cured pursuant to the terms of the Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7 **<u>Cooperation by Tenant</u>**. Tenant acknowledges that the timing of the completion of the Tenant Improvements is of the utmost importance to Landlord. Accordingly, Tenant hereby agrees to fully and diligently cooperate with all reasonable requests by Landlord in connection with or related to the design and construction of the Tenant Improvements, and in connection therewith, shall respond to Landlord's reasonable requests related to the Tenant Improvements (including, without limitation, with respect to meetings, information and/or approvals), except as specifically set forth herein to the contrary, within three (3) business days following request by Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.8 **<u>Freight Elevators</u>**. Subject to Landlord's reasonable rules and regulations and payment by Tenant to Landlord of Building standard charges, Landlord shall, consistent with its obligations to other tenants of the Building, make the freight elevator reasonably available to Tenant in connection with initial decorating, furnishing and moving into the Premises.

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**<u>SCHEDULE 1 TO EXHIBIT B</u>**

**<u>DEPICTION AND/OR DESCRIPTION OF LANDLORD'S DELIVERY WORK</u>**

ENCARDA TURNKEY TI SCOPE LIST - PHASE 1

This document, taken in its entirety, clarifies the scope defined in the "Test Fit Plan" (the "Plan") produced by CAC and dated 07/26/2024 included here as Exhibit A: Phase I Final Space Plan. For any conflict and ambiguity between this document and the Plan, this document shall govern.

<u>OFFICE AREA SCOPE INCLUDES</u>:

OFFICE AREA GENERAL:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 8' 0" X 36" solid wood veneer doors with clear anodized aluminum doorframes with sidelights
unless noted otherwise in Scope List.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Walls to be 6" above grid unless otherwise noted on Scope List.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Ceilings

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Armstrong 2x2 acoustic ceilings tile & supra fine 9 16 grid (or equivalent) in open office areas,
private offices, huddle rooms, phone rooms, and conference rooms impacted by construction, as noted below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Flooring (unless noted otherwise m Scope List)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Carpet tiles and rubber base in open office areas, private office areas, meeting rooms, and lobby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• LVT in breakroom and wellness room.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Paint

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Furnish and install new primer and latex paint on all wall surfaces per agreed upon finish schedule (TBD during
design).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Lighting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing T-24. LED lighting to remain throughout. Reuse existing fixtures
as noted on Plan, relocate & install existing lights per new layout as required in areas of work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• New lighting in new offices to match existing salvaged light fixtures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Electrical

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Standard duplex convenience outlets as required by code in new areas of construction, as noted on Plan, including
private offices and wellness rooms.

SCHEDULE 1 TO

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• All remaining existing power to remain as-is. including existing power
connections to existing Tenant Furnished Tenant Installed (TFTI) open office modular furniture.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Power data (ring & string) as noted on Plan.

PHASE I OFFICE:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Lobby (219)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Break Room (204)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Two (2) Open Office Areas (220 & 205)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Two (2) Private Offices (219 & 217)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Six (6) Meeting Rooms (206, 211, 212. 215, 216, 226)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Two (2) Phone Rooms (213 & 214)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Scope Room (241)

1. Furnish and install one (1) Lobby (219) by demolishing plan-south wall adjacent to office 218. install new
carpet tiles, and pendant light.

2. Furnish and install new LVT in Break Room (204). as noted on Plan Includes removal of existing flooring,
protection of existing finishes as needed, allowance to rework existing furniture in open offices to accommodate for temp barriers.

3. Furnish and install new carpet tiles and rubber base in Open Office Areas (205. 220). Meeting Rooms (206, 211,
11, 212, 215, 216. 226). Phone Rooms (213, 214) as noted on Plan Includes removal of existing flooring, protection of existing finishes as needed.

4. New paint to new and existing walls, latex single component epoxy at labs and vivarium, paint all exposed
structural columns and braces w two coats of DTM paint. hollow metal doors and frames w two coats of pre-catalyzed epoxy, open structure ceilings at all open office areas are to be touched up as needed.

5. Provide power for two (2) TFTI deli fridges in Scope Room (241).

SCHEDULE 1 TO

EXHIBIT B

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EXCLUSIONS:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Movable partitions from Break Room to Office

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• New epoxy flooring in Vivarium throughout (Patch work only).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Furniture in office areas, break room area. collaboration & other areas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Equipment anchorage or calculations/drawing package for permitting, except for the Modular Clean Room as noted
above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Specialty lighting, wall treatments or coverings. IDEA paint. baffles, white boards, and acoustical
materials/enhancement (unless noted above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Touchless faucets in break room, lab area. etc. or sink pedals in the lab area.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Drinking fountain updates or upgrades including but not limited to bottle filling stations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Low voltage, data and or IT cabling or racking. or monitors (except ring & string provided where noted
above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• AV equipment, screens, or infrastructure including electrical and cable rough-in for speakers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Moveable gowning racks, metro racks, mobile storage, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Biosafety cabinets (BSC) & incubators

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Downdraft tables

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Niederman retractable arm exhaust or blast gates

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• DI system or Milli-Q including equipment or piping.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 0<sub>2</sub> & LN<sub>2</sub> tanks or N<sub>2</sub> generator, tanks, cannisters. etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Free-standing lab equipment (glass cabinets, ice machines, freezers, chemical, flammable or waste storage
containers, etc.)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Signage, other than code required (code required signage to compliment selected signage).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Security System (except ring & string provided where noted above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Emergency Responder Radio Coverage System (ERRCS) or other DAS system.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Emergency Power beyond Tenant s pro-rata share.

***[Continues on Following Page]***

SCHEDULE 1 TO

EXHIBIT B

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**<u>Space Plan Depicting Certain Portions of Landlord's Delivery Work:</u>**

![LOGO](g107928g0319083953609.jpg)

SCHEDULE 1 TO

EXHIBIT B

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**<u>SCHEDULE 2 TO EXHIBIT B</u>**

**<u>APPROVED SPACE PLAN</u>**

**<u>Scope of Work:</u>**

ENCARDA TURNKEY TI SCOPE LIST - PHASE II

This document, taken m its entirety, clarifies the scope defined in the Test Fit Plan (the "Plan") produced by CAC and dated 07/26/2024 included here as Exhibit B: Phase II Final Space Plan. For any conflict and ambiguity between this document and the Plan, this document shall govern.

<u>OFFICE AREA SCOPE INCLUDES</u>:

OFFICE AREA GENERAL:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 8' 0" X 36" (or 8' 0" X 72" for double doors) solid wood veneer doors with
clear anodized aluminum doorframes with sidelights unless noted otherwise m Scope List.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Walls to be 6" above grid unless otherwise noted on Scope List.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Ceilings

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Armstrong 2x2 acoustic ceilings tile & supra fine 9/16 grid (or equivalent) in open office areas,
private offices, huddle rooms, phone rooms, and conference rooms impacted by construction, as noted below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Flooring (unless noted otherwise in Scope List)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Carpet tiles and rubber base in open office areas, private office areas, meeting rooms, and lobby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• LVT in breakroom and wellness room.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Paint

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Furnish and install new primer and latex paint on all wall surfaces per agreed upon finish schedule (TBD during
design).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Lighting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing T-24, LED lighting to remain throughout. Reuse existing fixtures
as noted on Plan, relocate & install existing lights per new layout as required m areas of work.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• New lighting in new offices to match existing salvaged light fixtures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Electrical

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Standard duplex convenience outlets as required by code in new areas of construction, as noted on Plan, including
private offices and wellness rooms.

SCHEDULE 2 TO

EXHIBIT B

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• All remaining existing power to remain as-is. including existing power
connections to existing Tenant Furnished Tenant Installed (TFTI) open office modular furniture.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Power data (ring & string) as noted on Plan.

PHASE II OFFICE

• One (1) Break Room (204)

• Eight (8) Offices (209. 210, 217, 218, 221, 222, 223, 224)

• One (1) Wellness Room (225)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Furnish and install two sets of double doors with glazing partition at Break Room (204) separating Open
Office (205).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Relocate one (1) DEA Safe to Vivarium Receiving (261) as noted on Plan. Add new cypher locking
hardware at DEA door and card reader at Vivarium Receiving door.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Furnish and install six (6) offices (209,210, 221, 222, 223, 224) with new doors with sidelights and or
adjacent glazing, as noted on Plan. One (1) duplex outlet with data ring & string on wall, and one (1) convenience duplex outlet.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Modify two (2) offices (217, 218) with new walls on plan-north.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Furnish and install one (1) Wellness Room (225) with new door, millwork of plastic laminate upper and
lower cabinets with solid surface countertop and one (1) ADA compliant hand sink with standard faucet. Two (2) convenience duplex outlets with dedicated circuit for one (1) TFTI undercounter refrigerator.

<u>LAB AREA SCOPE INCLUDES</u>:

LAB AREA GENERAL:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Walls

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing walls between lab and office areas

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing walls between Vivarium and other lab spaces.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing walls between lab interior spaces.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing walls between Vivarium suites.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Walls to be 6" above grid in lab interior, full height between lab and office areas, unless otherwise noted
in Scope List.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Walls 6" above ceiling between Vivarium interior spaces.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Door/Frame/Hardware

SCHEDULE 2 TO

EXHIBIT B

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 8'0" X 42" hollow metal doors (or 8' 0" X 72" for double doors) with
half-lites unless noted otherwise in Scope List. Include kickplates on push side of lab doors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Ceilings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing 2x4 grid in General Labs to remain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Gyp Board/Hard lid ceiling in Vivarium spaces and Lab Support Rooms to remain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Lighting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing T-24 compliant, 2x4 LED lighting throughout all lab areas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing Lights Vivarium spaces to remain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Flooring (unless noted differently in Scope List)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing Welded Sheet Vinyl or Welded Rubber flooring to remain as-in in
General Lab and Lab Support Rooms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Patch and repair existing Epoxy Flooring in Vivarium spaces.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Paint

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Epoxy paint for all General Lab. Lab Support, Vivarium, and GMP spaces — Spec TBD.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Lab Casework

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing casework bench and base to remain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Existing Fume Hoods to remain.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Electrical

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Quantities of normal power vs E-power outlets — TBD.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Power/plumbing connection and floor drains for Cage Wash and Animal Holding Rooms—size TBD.

PHASE II - LAB

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Procedure Room (279)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Five (5) Vivarium Animal Holding Rooms (271, 274, 275, 276, 277)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Vivarium Vestibule (266)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Dirty Room (270)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Mechanical Room (264)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Clean Room (263)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Chern Lab (230)

SCHEDULE 2 TO

EXHIBIT B

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Bio Lab (240)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Chem Stock Room (243)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Compound Management Room (244)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Analytical Lab (242)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• One (1) Process Cold Room within existing Analytical (255, 253)

1. Modify one (1) Procedure Room (279) with new surgical light fixture and power for switch. Provide
additional framing to support fixture, patch and repair ceiling.

2. Modify five (5) Vivarium Holding Rooms (271. 274, 275, 276, 277). each with (1) floor drain, as noted
on Plan. Patch and repair existing epoxy flooring as needed. Match flooring as close as possible to existing. Excludes new overlay/finish.

3. Finish and install one (1) Vivarium Vestibule (266) with set of double hollow metal entry doors from
Vestibule corridor. Doors to have half height vision lite on each leaf, automatic door bottoms, hydraulic closers, armor plate, coordinator bar and ring & string for TFTI security.

4. Modify existing room to one (1) Dirty Room with door and floor drain(s) (Quantity — TBD), as noted
on plan—Patch and repair existing epoxy flooring around floor drains, match as close as possible to existing. Excludes new overlay/finish. Includes power and plumbing coordinated with Clean room.

5. Modify existing room to one (1) Mechanical Room including installation and hookup. Furnish and install
floor drain(s) (Quantity — TBD). as noted on plan. Patch and repair existing epoxy flooring around floor drains, match as close as possible to existing. Excludes new overlay/finish. Includes coordinated power and plumbing with Dirty and Clean
rooms dedicated to future tenant provided cage wash. Furnish and install new hollow metal door from Clean Room (263).

6. Furnish and install one (1) Clean Room (263) with four (4) floor drains. Patch and repair
existing epoxy flooring around floor drains Match as close as possible to existing. Excludes new overlay/finish. Includes power and plumbing coordinated with Dirty room dedicated to cage wash. Provide aluminum bumpers around room to match existing
conditions.

7. Modify existing one (1) Chem Lab (230) with power, vent and N2 for (TFTI) LC/MSs and refrigerators.

8. Modify existing one (1) Bio Lab (240) with power, vent and N2 for (1111) LC/MSs.

9. Furnish and install one (1) Chem Stockroom (243) with hollow metal door and misc. drywall patching.
Provide 2" ducts for venting, two (2) vents for TFTI solvent cabinets, and three to four (3-4) vents for (TFTI) reagent cabinets.

10. Compound Management (244) and Analytical Lab (242) to remain as-is.

SCHEDULE 2 TO

EXHIBIT B

------

11. Furnish and install one (1) Process Cold Room (255) adjacent to existing Analytical (253) with
door, sheet vinyl flooring, dehumidification system (controls excluded), insulated 4" wall and ceiling panels. Tables to be TFTI. Slab below to be insulated.

SCHEDULE 2 TO

EXHIBIT B

------

EXCLUSIONS:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Movable partitions from Break Room to Office

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• New epoxy flooring in Vivarium throughout (Patch work only included).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Furniture in office areas, break room/area. collaboration & other areas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Equipment anchorage or calculations/drawing package for permitting, except for the Modular Clean Room as noted
above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Specialty lighting, wall treatments or coverings, IDEA paint. baffles, white boards, and acoustical
materials/enhancement (unless noted above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Touchless faucets in break room, lab area, etc. or sink pedals in die lab area.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Drinking fountain updates or upgrades including but not limited to bottle filling stations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Low voltage, data and/or IT cabling or racking. or monitors (except ring & string provided where noted
above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• AV equipment, screens, or infrastructure including electrical and cable rough-in for speakers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Moveable gowning racks, metro racks, mobile storage, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Biosafety cabinets (BSC) & incubators

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Downdraft tables

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Niederman retractable arm exhaust or blast gates

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• DI system or Milli-Q including equipment or piping.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 0<sub>2</sub> & LN<sub>2</sub> tanks or N<sub>2</sub> generator, tanks, cannisters, etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Free-standing lab equipment (glass cabinets, ice machines, freezers, chemical, flammable or waste storage
containers, etc.)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Signage, other than code required (code required signage to compliment selected signage).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Security System (except ring & string provided where noted above).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Emergency Responder Radio Coverage System (ERRCS) or other DAS system.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Emergency Power beyond Tenant's pro-rata share

SCHEDULE 2 TO

EXHIBIT B

------

**<u>Space Plan:</u>**

![LOGO](g107928g0319083954082.jpg)

SCHEDULE 2 TO

EXHIBIT B

------

**<u>SCHEDULE 3 TO EXHIBIT B</u>**

**<u>FORM OF SPECIAL ALLOWANCE ELECTION NOTICE</u>**

[Date]

[LANDLORD ADDRESS]

---

| | |
|:---|:---|
| Re: | <u>Lease (the</u> <u>"</u>**<u>Lease</u>**<u>"</u><u>)</u> <u>between</u> <u>(</u><u>"</u>**<u>Landlord</u>**<u>"</u><u>)</u> <u>and</u> <u>(</u><u>"</u>**<u>Tenant</u>**<u>"</u><u>)</u> <u>dated</u> <u>, 20</u><u>__</u><u>, for space (the</u> <u>"</u>**<u>Premises</u>**<u>"</u><u>) in the building located</u> <u>at</u> <u>(the</u> <u>"</u>**<u>Building</u>**<u>"</u><u>)</u>.  |

---

**<u>NOTICE OF ELECTION TO USE SPECIAL ALLOWANCE</u>**

Dear [LANDLORD]:

The above referenced Tenant hereby (i) elects to use $<u> </u>of the Special Allowance granted to Tenant pursuant to the terms of <u>Section</u> <u>2.3</u> of the Tenant Work Letter attached as <u>Exhibit B</u> to the referenced Lease (such amount the "**Elected Special Allowance**"), and (ii) agrees that Tenant will execute the Special Allowance Amendment with respect thereto as provided in such <u>Section</u> <u>2.3</u>.

If Tenant is a corporation, trust or partnership, each individual executing this letter on behalf of Tenant hereby represents and warrants that such person signing on behalf of Tenant is authorized to do so.

Very truly yours,

<u>TENANT</u>:

---

| |
|:---|
| By: |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:<u> </u> |
| Its: |

---

SCHEDULE 3 TO

EXHIBIT B

------

**<u>SCHEDULE 4 TO EXHIBIT B</u>**

**FORM OF AGREEMENT FOR ADDITIONAL MONTHLY BASE RENT** 

**<u>FIRST AMENDMENT TO LEASE</u>**

This FIRST AMENDMENT TO LEASE ("**Amendment**") is made and entered into as of<u> </u>, 202__, by and between ("**Landlord**"), and<u> </u>("**Tenant**").

<u>R E C I T A L S</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Landlord and Tenant are parties to that certain Lease dated __________, 20___, (the "**Lease**"), pursuant to which Tenant leases premises on the<u> </u>floors (the "**Premises**") containing approximately rentable square feet of space in the building located at_________<u> </u>(the "**Building"**).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. Landlord and Tenant desire to amend the Lease on the terms and conditions set forth in this Amendment.

<u>A G R E E M E N T</u>:

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Terms</u>. All capitalized terms when used herein shall have the same respective meanings as are given such terms in the Lease unless expressly provided otherwise in this Amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Special Allowance</u>. Pursuant to the terms of <u>Section</u> <u>2.3</u> of the Tenant Work Letter attached to the Lease as **<u>Exhibit B</u>**, Tenant was entitled to a Special Allowance of up to $718,860.00 (<u>i.e.</u>, $20.00 per rentable square foot of the Premises) (the "Special Allowance"). Notwithstanding any provision to the contrary contained in the Lease, Landlord and Tenant hereby acknowledge and agree that Tenant has utilized_________<u> </u>and __/100 Dollars ($__________________ .) of the Special Allowance (the "Utilized Special Allowance"), as__________________.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Additional Monthly Base Rent</u>. As a result of Tenant's use of the Utilized Special Allowance, Tenant is required to pay Additional Monthly Base Rent calculated as provided in <u>Section</u> <u>2.3</u> of the Tenant Work Letter, which Additional Monthly Base Rent shall be equal to $______ per month, payable on or before the first (1<sup>st</sup>) day of each month commencing as of<u> </u>__, and continuing through the expiration of the initial Lease Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. [**PROVIDE FOR ANY OTHER LOGISTICAL TERMS IF SPECIAL ALLOWANCE BEING APPLIED TO CERTAIN COSTS PURSUANT TO SECTION 2.3 OF THE TENANT WORK LETTER AND CLARITY IS NEEDED]**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>No Further Modification</u>. Except as specifically set forth in this Amendment, all of the terms and provisions of the Lease shall remain unmodified and in full force and effect.

SCHEDULE 4 TO

EXHIBIT B

------

IN WITNESS WHEREOF, this Amendment has been executed as of the day and year first above written.

---

| | |
|:---|:---|
| <u>LANDLORD:</u> | <u>TENANT:</u> |
| **HCP OYSTER POINT III, LLC**,<br> a Delaware limited liability company | **ENCARDA THERAPEUTICS, INC.**<br> a Delaware corporation |
| By: | By: |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:<u> </u> | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:<u> </u> |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Its: | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Its: |
|  | By: |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Name:<u> </u> |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Its: |

---

SCHEDULE 4 TO

EXHIBIT B

------

**<u>SCHEDULE 5 TO EXHIBIT B</u>**

**TENANT MILESTONE SCHEDULE** 

ENCARDA TI MILESTONE SCHEDULE

PHASE II OPTION I CAGEWASH

131 OYSTER POINT

SOUTH SAN FRANCISCO, CA

---

| | |
|:---|:---|
| 08/26/24 | Start of SDs (2 weeks) |
| 08/30/24 | Equipment List Duc from Encarda |
| 09/13/24 | SD Drawing Approval Duc from Encarda |
| 09/13/24 | HMIS List Duc from Encarda |
| 09/30/24 | DD Drawing Approval from Encarda |
| 11/01/24 | IFP Drawing Approval Duc from Encarda |

---

The dates in this **<u>Schedule 5</u>**, are anticipated dates based on the current understanding of the project scope – and could be delayed subject to Tenant-requested Value Engineering, Tenant Change Requests, and/or other Tenant Delays. Permitting durations are estimated and subject to the responsiveness of the City of South San Francisco. Landlord, hereby agrees to continue to track progress toward these milestones and provide updates to Tenant.

SCHEDULE 5 TO

EXHIBIT B

------

**<u>EXHIBIT C</u>**

**<u>THE COVE</u>**

**<u>LIST OF EXISTING FURNITURE</u>**

---

| |
|:---|
| **Adjustable Desk and Task Chair:**<br><u>North Side:</u><br> Approximately fifty-seven (57) desks and task chairs<br><u>South Side:</u><br> Approximately sixty-one (61) desks and task chairs |
| **Central Board Room:**<br>Large table, projector, and nine (9) chairs |
| **Check-In Station** |
| **Large Filing Cabinet** |
| **Lobby Soft Seating:**<br>Two (2) orange armchairs, coffee table, side table, and rug |
| **Mother's Room:**<br>Blue velvet armchair, small mini fridge, storage cabinet. |
| **North Central Large Conference Room:**<br>Conference table, eight (8) chairs, TV mount |
| **North Side Hall, Orange Armchair** |
| **Northeast Conference Room – Large:**<br>Conference table, eight (8) chairs |
| **Northeast Conference Room – Small 1:**<br>Small collaboration table and three (3) task chairs |
| **Northeast Conference Room – Small 2:**<br>Small collaboration table and three (3) task chairs |
| **Northeast Conference Room – Small 3:**<br>Small collaboration table and three (3) task chairs |
| **Northwest Conference Room – Medium:**<br>Small conference table and six (6) task chairs |
| **Northwest Conference Room – Small 1:**<br>Three (3) task chairs |

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EXHIBIT C

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| |
|:---|
| **Northwest Conference Room – Small 2:**<br>Three (3) task chairs |
| **Planters: Two (2)** |
| **Rubbish and Recycling Bins:**<br>Throughout space |
| **South Central Huddle Room 1 – Table:**<br>Small collaboration table and three (3) task chairs |
| **South Central Conference Room – Medium:**<br>Conference table and six (6) chairs |
| **Southeast Huddle Room 1:**<br>Two desk chairs |
| **Southeast Huddle Room 2:**<br>Small collaboration table and two (2) task chairs |
| **Southeast Conference Room – Large:**<br>Large conference table, TV mount, six (6) chairs, and one (1) desk chair |
| **Under-Desk Storage:**<br>Approximately 118 cabinets |
| **White Kitchen Chair** |

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EXHIBIT C

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**<u>EXHIBIT D</u>**

**<u>THE COVE</u>**

**<u>FORM OF TENANT'S ESTOPPEL CERTIFICATE</u>**

The undersigned as Tenant under that certain Lease (the "**Lease**") made and entered into as of<u> </u>_______________, 20___ by and between **HCP OYSTER POINT III, LLC**, a Delaware limited liability company as Landlord, and the undersigned as Tenant, for Premises consisting of a portion of the office building located at 131 Oyster Point Boulevard, South San Francisco, California, certifies as of the date hereof as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Attached hereto as **<u>Exhibit A</u>** is a true and correct copy of the Lease and all amendments and modifications thereto. The documents contained in **<u>Exhibit A</u>** represent the entire agreement between the parties as to the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The undersigned currently occupies the Premises described in the Lease, the Lease Term commenced on<u> </u>_____________, and the Lease Term expires on<u> </u>_______________, and the undersigned has no option to terminate or cancel the Lease or to purchase all or any part of the Premises, the Building and/or the Project.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Base Rent became payable on ___________.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The Lease is in full force and effect and has not been modified, supplemented or amended in any way except as provided in **<u>Exhibit A</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Tenant has not transferred, assigned, or sublet any portion of the Premises nor entered into any license or concession agreements with respect thereto except as follows: _________________.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Tenant shall not modify the documents contained in **<u>Exhibit A</u>** without the prior written consent of Landlord's mortgagee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. All monthly installments of Base Rent, all Additional Rent and all monthly installments of estimated Additional Rent have been paid when due through<u> </u>______________. The current monthly installment of Base Rent is $___________.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. All conditions of the Lease to be performed by Landlord necessary to the enforceability of the Lease have been satisfied and Landlord is not in default thereunder. In addition, the undersigned has not delivered any notice to Landlord regarding a default by Landlord thereunder. The Lease does not require Landlord to provide any rental concessions or to pay any leasing brokerage commissions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. No rental has been paid more than thirty (30) days in advance and no security has been deposited with Landlord except as provided in the Lease. Neither Landlord, nor its successors or assigns, shall in any event be liable or responsible for, or with respect to, the retention, application and/or return to Tenant of any security deposit paid to any prior landlord of the Premises, whether or not still held by any such prior landlord, unless and until the party from whom the security deposit is being sought, whether it be a lender, or any of its successors or assigns, has actually received for its own account, as landlord, the full amount of such security deposit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. As of the date hereof, there are no existing defenses or offsets, or, to the undersigned's knowledge, claims or any basis for a claim, that the undersigned has against Landlord.

EXHIBIT D

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. If Tenant is a corporation or partnership, each individual executing this Estoppel Certificate on behalf of Tenant hereby represents and warrants that Tenant is a duly formed and existing entity qualified to do business in California and that Tenant has full right and authority to execute and deliver this Estoppel Certificate and that each person signing on behalf of Tenant is authorized to do so.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. There are no actions pending against the undersigned under the bankruptcy or similar laws of the United States or any state.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. Tenant has never permitted or suffered, nor does Tenant have any knowledge of, the generation, manufacture, treatment, use, storage, disposal or discharge of any hazardous, toxic or dangerous waste, substance or material in, on, under or about the Project or the Premises or any adjacent premises or property in violation of any federal, state or local law, ordinance, rule or regulation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. To the undersigned's knowledge, all tenant improvement work to be performed by Landlord under the Lease has been completed in accordance with the Lease and has been accepted by the undersigned and all reimbursements and allowances due to the undersigned under the Lease in connection with any tenant improvement work have been paid in full, except for:<u> </u>________________. All work (if any) in the common areas required by the Lease to be completed by Landlord has been completed and all parking spaces required by the Lease have been furnished.

The undersigned acknowledges that this Estoppel Certificate may be delivered to Landlord or to a prospective mortgagee or prospective purchaser, and acknowledges that said prospective mortgagee or prospective purchaser will be relying upon the statements contained herein in making the loan or acquiring the property of which the Premises are a part and that receipt by it of this certificate is a condition of making such loan or acquiring such property.

Executed at _______________ on the<u> </u>day of _____________, 20__.

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| | |
|:---|:---|
| "**Tenant**": | "**Tenant**": |
| **ENCARDA, INC.**,<br> a <u>Delaware</u> corporation | **ENCARDA, INC.**,<br> a <u>Delaware</u> corporation |
| By: |  |
|  | Its: |
| By: |  |
|  | Its: |

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EXHIBIT D

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**<u>EXHIBIT E</u>**

**THE COVE** 

**<u>ENVIRONMENTAL QUESTIONNAIRE</u>**

**ENVIRONMENTAL QUESTIONNAIRE** 

**FOR COMMERCIAL AND INDUSTRIAL PROPERTIES** 

**Tenant Name: ENCARDA, INC., a Delaware corporation** 

**Lease Address:** 131 Oyster Point Boulevard, South San Francisco, California 94080

**Lease Type (check correct box—*right click to properties*):** ☐ **Primary Lease/Lessee** 

☐ **Sublease from:_____________________** 

**<u>Instructions</u>**: The following questionnaire is to be completed by the Lessee representative with knowledge of the planned operations for the specified building/location. Please print clearly and attach additional sheets as necessary.

**1.0**  **<u>PROCESS INFORMATION</u>** 

Describe planned site use, including a brief description of manufacturing processes and/or pilot plants planned for this site, if any.

**2.0**  **<u>HAZARDOUS MATERIALS – OTHER THAN WASTE</u>** 

Will (or are) non-waste hazardous materials be/being used or stored at this site? If so, continue with the next question. If not, go to Section 3.0.

2-1 Are any of the following materials handled on the Property? ☐ Yes ☐ No

*[A material is handled if it is used, generated, processed, produced, packaged, treated, stored, emitted, discharged, or disposed.] If YES, check (right click to properties) the applicable correct <u>Fire Code hazard categories</u> below.* 

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| ☐ | Combustible dusts/fibers | ☐ | Explosives | ☐ | Flammable liquids |
| ☐ | Combustible liquids (e.g., oils) | ☐ | Compressed gas - inert | ☐ | Flammable solids/pyrophorics |
| ☐ | Cryogenic liquids - inert | ☐ | Compressed gas - flammable/pyrophoric | ☐ | Organic peroxides |
| ☐ | Cryogenic liquids - flammable | ☐ | Compressed gas - oxidizing | ☐ | Oxidizers - solid or liquid |
| ☐ | Cryogenic liquids - oxidizing | ☐ | Compressed gas - toxic | ☐ | Reactives - unstable or water reactive |
| ☐ | Corrosives - solid or liquid | ☐ | Compressed gas - corrosive | ☐ | Toxics - solid or liquid |

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EXHIBIT E

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| | |
|:---|:---|
| 2-2. | For all materials checked in Section 2-1 above, please list the specific material(s), use(s), and quantities *of each used or stored on the site in the table below; or attach a separate inventory. NOTE: If proprietary, the constituents need not be named but the hazard information and volumes are required.*  |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Material/**<br> **Chemical** | **Physical**<br> **State (Solid,**<br> **Liquid, or**<br> **Gas)** | **Container Size** | **Number of Containers**<br> **Used & Stored** | **Total Quantity** | **Units (pounds**<br> **for solids,**<br> **gallons or liters**<br> **for liquids, &)** |

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2-3. Describe the planned storage area location(s) for the materials in Section 2-2 above. Include site maps and drawings as appropriate.

__________________________________________________________________________________________________

__________________________________________________________________________________________________

__________________________________________________________________________________________________

EXHIBIT E

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| | |
|:---|:---|
| 2-4. | Other hazardous materials. Check below (*right click to properties)* if applicable. *NOTE: If either of the latter two are checked (BSL-3 and/or radioisotope/radiation), be advised that not all lease locations/cities or lease agreements allow these hazards; and if either of these hazards are planned, additional information will be required with copies of oversight agency authorizations/licenses as they become available.*  |

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☐ Risk Group 2/Biosafety Level-2 Biohazards ☐ Risk Group 3/Biosafety Level-3 Biohazards ☐ Radioisotopes/Radiation

**3.0**  **<u>HAZARDOUS WASTE (i.e., REGULATED CHEMICAL WASTE)</u>** 

Are (or will) hazardous wastes (be) generated? ☐ Yes ☐ No

If YES, continue with the next question. If not, skip this section and go to Section 4.0.

3-1. Are or will any of the following hazardous (CHEMICAL) wastes generated, handled, or disposed of (where applicable and allowed) on the property?

☐ Liquids ☐ Process sludges ☐ PCBs <br> ☐ Solids ☐ Metals ☐ wastewater

3-2. List and estimate the quantities of hazardous waste identified in Question 3-1 above.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **HAZARDOUS (CHEMICAL)<br>WASTE GENERATED** | **SOURCE** | **WASTE TYPE** | **WASTE TYPE** | **APPROX. MONTHLY<br>QUANTITY with units** | **DISPOSITION [e. g.,<br>off-site landfill,<br>incineration, fuel blending<br>scrap metal; wastewater<br>neutralization (onsite or<br>off-site)]** |
| **HAZARDOUS (CHEMICAL)<br>WASTE GENERATED** | **SOURCE** | **RCRA<br>listed<br>(federal)** | **Non-<br>RCRA<br>(California<br>ONLY or<br>recycle)** | **APPROX. MONTHLY<br>QUANTITY with units** | **DISPOSITION [e. g.,<br>off-site landfill,<br>incineration, fuel blending<br>scrap metal; wastewater<br>neutralization (onsite or<br>off-site)]** |
|  |  | ☐ | ☐ |  |  |
|  |  | ☐ | ☐ |  |  |
|  |  | ☐ | ☐ |  |  |
|  |  | ☐ | ☐ |  |  |
|  |  | ☐ | ☐ |  |  |
|  |  | ☐ | ☐ |  |  |

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3-3. Waste characterization by: Process knowledge ☐ EPA lab analysis ☐ Both ☐

3-4. Please include name, location, and permit number (e.g. EPA ID No.) for transporter and disposal facility if applicable. Attach separate pages as necessary. *If not yet known, write "TBD."*

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| | | | |
|:---|:---|:---|:---|
| **Hazardous Waste**<br> **Transporter/Disposal Facility Name** | **Facility Location** | **Transporter (T) or**<br> **Disposal (D) Facility** | **Permit Number** |

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EXHIBIT E

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| | |
|:---|:---|
| 3-5. | Are pollution controls or monitoring employed in the process to prevent or minimize the release of wastes *into the environment? NOTE: This does NOT mean fume hoods; examples include air scrubbers, cyclones, carbon or HEPA filters at building exhaust fans, sedimentation tanks, pH neutralization systems for wastewater, etc.*  |

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☐ Yes ☐ No If YES, please list/describe:_________________________________________________________________

__________________________________________________________________________________________________

__________________________________________________________________________________________________

**4.0**  **<u>OTHER REGULATED WASTE (i.e., REGULATED BIOLOGICAL WASTE, referred to as</u> <u>"</u> <u>Medical Waste</u> <u>"</u> <u>in</u> <u>California</u> <u>)</u>** 

4-1. Will (or do) you generate medical waste? ☐ Yes ☐ No If NO, skip to Section 5.0.

4-2. Check the types of waste that will be generated, all of which fall under the California Medical Waste Act:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| ☐ | Contaminated sharps (i.e., if contaminated with ≥ Risk Group 2 materials) | ☐ | Animal carcasses | ☐ | Pathology waste known or suspected to be contaminated with ≥ Risk Group 2 pathogens |
| ☐ | Red bag biohazardous waste (i.e., with ≥ Risk Group 2 materials) for autoclaving | ☐ | Human or non-human primate blood, tissues, etc. (e.g., clinical specimens) | ☐ | Trace Chemotherapeutic Waste and/or Pharmaceutical waste NOT otherwise regulated as RCRA chemical waste |

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4-3. What vendor will be used for off-site autoclaving and/or incineration?

__________________________________________________________________________________________________

4-5. Do you have a Medical Waste Permit for this site? ☐ Yes ☐ No, not required.

☐ No, but an application will be submitted.

**5.0**  **<u>UNDERGROUND STORAGE TANKS (USTS) & ABOVEGROUND STORAGE TANKS (ASTS)</u>** 

5-1. Are underground storage tanks (USTs), aboveground storage tanks (ASTs), or associated pipelines used for the storage of petroleum products, chemicals, or liquid wastes present on site (lease renewals) or required for planned operations (new tenants)? ☐ Yes ☐ No

*<u>NOTE</u>: If you will have your own diesel emergency power generator, then you will have at least one AST! [NOTE: If a backup generator services multiple tenants, then the landlord usually handles the permits.]* 

If NO, skip to Section 6.0. If YES, please describe capacity, contents, age, type of the USTs or ASTs, as well any associated leak detection/spill prevention measures. Please attach additional pages if necessary.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **UST or**<br> **AST** | **Capacity**<br> **(gallons)** | **Contents** | **Year**<br> **Installed** | **Type (Steel, Fiberglass, etc.)** | **Associated Leak Detection / Spill<br>Prevention Measures\*** |

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EXHIBIT E

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\* <u>NOTE</u>: The following are examples of leak detection / spill prevention measures: integrity testing, inventory reconciliation, leak detection system, overfill spill protection, secondary containment, cathodic protection.

5-2. Please provide copies of written tank integrity test results and/or monitoring documentation, if available.

5-3. Is the UST/AST registered and permitted with the appropriate regulatory agencies?

☐ Yes ☐ No, not yet

If YES, please attach a copy of the required permit(s). *See Section 7-1 for the oversight agencies that issue permits, with the exception of those for diesel emergency power generators which are permitted by the local Air Quality District (Bay Area Air Quality Management District = BAAQMD; or San Diego Air Pollution Control District = San Diego APCD).*

5-4. If this Questionnaire is being completed for a lease renewal, and if any of the USTs/ASTs have leaked, please state the substance released, the media(s) impacted (e.g., soil, water, asphalt, etc.), the actions taken, and all remedial responses to the incident.

__________________________________________________________________________________________________

__________________________________________________________________________________________________

__________________________________________________________________________________________________

5-5. If this Questionnaire is being completed for a lease renewal, have USTs/ASTs been removed from the Property?

☐ Yes ☐ No

If YES, please provide any official closure letters or reports and supporting documentation (e.g., analytical test results, remediation report results, etc.).

5-6. For Lease renewals, are there any above or below ground pipelines on site used to transfer chemicals or wastes?

☐ Yes ☐ No

For new tenants, are installations of this type required for the planned operations?

☐ Yes ☐ No

If YES to either question in this Section 5-6, please describe.

**6.0**  **<u>ASBESTOS CONTAINING BUILDING MATERIALS</u>** 

Please be advised that an asbestos survey may have been performed at the Property. If provided, please review the information that identifies the locations of known asbestos containing material or presumed asbestos containing material. All personnel and appropriate subcontractors should be notified of the presence of these materials, and informed not to disturb these materials. Any activity that involves the disturbance or removal of these materials must be done by an appropriately trained individual/contractor.

EXHIBIT E

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**7.0**  **<u>OTHER REGULATORY PERMITS/REQUIREMENTS</u>** 

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| | |
|:---|:---|
| 7-1. | Does the operation have or require an industrial wastewater permit to discharge into the local National Pollutant Discharge Elimination System (NPDES)? *[Example: This applies when wastewater from equipment cleaning is routed through a pH neutralization system prior to discharge into the sanitary or lab sewer for certain pharmaceutical manufacturing wastewater; etc.]* Permits are obtained from the regional sanitation district that is treating wastewater.  |

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☐ Yes ☐ No ☐ No, but one will be prepared and submitted to the Landlord property management company.

If so, please attach a copy of this permit or provide it later when it has been prepared.

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| | |
|:---|:---|
| 7-2. | Has a Hazardous Materials Business Plan (HMBP) been developed for the site and submitted via the State of California Electronic Reporting System (CERS)? *[NOTE: The trigger limits for having to do this are* ≥ *200 cubic feet if any one type of compressed gas(except for carbon dioxide and inert simple asphyxiant gases, which have a higher trigger limit of* ≥ *1,000 cubic feet);* ≥ *55 gallons if any one type of hazardous chemical liquid; and* ≥*500 pounds of any one type of hazardous chemical solid. So a full-size gas cylinder and a 260- liter of liquid nitrogen are triggers! Don't forget the diesel fuel in a backup emergency generator if the diesel tank size is* ≥ *55 gallons and it is permitted under the tenant (rather than under the landlord).]* NOTE: Each local Certified Unified Program Agency (CUPA) in California governs the HMBP process so start there. Examples: the CUPA for cities in San Mateo County is the County Environmental Health Department; the CUPA for the City of Hayward, CA is the Hayward Fire Department; the CUPA for Mountain View is the Mountain View Fire Department; and, the CUPA for San Diego is the County of San Diego Hazardous Materials Division (HMD),  |

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☐ Yes ☐ No, not required. ☐ No, but one will be prepared and submitted, and a copy will be provided to the landlord property management company.

If one has been completed, please attach a copy. <u>Continue to provide updated versions as they are completed. This is a legal requirement in that State law requires that the owner/operator of a business located on leased or rented real property shall notify, in writing, the owner of the property that the business is subject to and is in compliance with the Hazardous Materials Business Plan requirements (Health and Safety Code Chapter 6.95 Section</u> <u>25505.1).</u>

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| | |
|:---|:---|
| 7-3. | <u>NOTE</u>: Please be advised that if you are involved in any tenant improvements that require a construction permit, you will be asked to provide the local city with a Hazardous Materials Inventory Statement (HMIS) to ensure that your hazardous chemicals fall within the applicable Fire Code fire control area limits for the applicable construction occupancy of the particular building. The HMIS will include much of the information listed in Section 2-2. Neither the landlord nor the landlord's property management company expressly warrants that the inventory provided in Section 2-2 will necessarily meet the applicable California Fire Code fire control area limits for building occupancy, especially in shared tenant occupancy situations. It is the responsibility of the tenant to ensure that a facility and site can legally handle the intended operations and hazardous materials desired/ needed for its operations, but the landlord is happy to assist in this determination when possible.  |

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EXHIBIT E

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**<u>CERTIFICATION</u>**

I am familiar with the real property described in this questionnaire. By signing below, I represent and warrant that the answers to the above questions are complete and accurate to the best of my knowledge. I also understand that Lessor will rely on the completeness and accuracy of my answers in assessing any environmental liability risks associated with the property.

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| |
|:---|
| Signature: |
| Name: |
| Title: |
| Date: |
| Telephone:<u> </u> |

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EXHIBIT E

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**<u>LETTER OF CREDIT RIDER</u>**

**<u>THE COVE</u>**

**1. LETTER OF CREDIT** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 **<u>Delivery of Letter of Credit</u>**. Tenant shall cause the "Bank" (as such term is defined below) to issue and deliver to Landlord, concurrently with Tenant's execution of the Lease, a letter of credit (the "**L-C**") in the amount set forth in <u>Section</u> <u>1.7</u> below (the "**L-C Amount**") that complies in full with all the terms and conditions of this Letter of Credit Rider. The L-C shall (i) be issued by the Bank, (ii) be irrevocable, unconditional, and payable upon demand in accordance with the terms of the L-C, (iii) have an initial expiration date not sooner than twelve (12) months from the issuance thereof; (iv) be maintained in effect, whether through renewal or extension, for the period commencing on the date of the Lease and continuing until the date (the "**L-C Expiration Date**") that is no less than sixty (60) days after the expiration of the Lease Term as the same may be extended, (v) contain a provision that provides that the L-C shall be automatically renewed on an annual basis without amendment of the L-C or action of Landlord or Tenant unless the Bank delivers a written notice of non-extension to Landlord at thirty (30) days prior to the then expiry date of the L-C, without any action whatsoever on the part of Landlord, (vi) be fully assignable by Landlord, its successors and assigns, (vii) permit partial draws and multiple presentations and drawings, (viii) otherwise be in the form and content identical to the form attached to this Letter of Credit Rider as **<u>Schedule 1</u>**, and (ix) except as set forth in such form, otherwise be subject to the International Standby Practices-ISP 98, International Chamber of Commerce Publication #590.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 **<u>Bank</u>**. The term "**Bank**" as used herein shall mean a money-center, solvent and nationally recognized bank listed on the most current list of Global Systemically Important Banks (G-SIBs) as of the Effective Date, and otherwise acceptable to Landlord in its sole and absolute discretion, and that (i) accepts deposits, maintains accounts, has a local South San Francisco or San Francisco office which will accept draws on a letter of credit or allows draws by facsimile, and whose deposits are insured by the FDIC, (ii) is not subject to the control or jurisdiction of any receiver, trustee, custodian, conservator, liquidator or similar official under any federal, state, foreign, or common law; (iii) is not a "bridge bank" or other successor (whether by asset sale, merger, or otherwise) to any bank that was the original issuer of the L-C, or any entity that is under the control of the Federal Deposit Insurance Corporation as receiver or conservator, unless expressly approved in writing by Landlord in its sole and absolute discretion; and (iv) whose long-term, unsecured and unsubordinated debt obligations are rated of no less than "A" by Fitch Ratings Ltd. ("**Fitch**") and a short term issuer rating of no less than "F1" by Fitch (or in the event such applicable Fitch ratings are no longer available, comparable ratings from Standard and Poor's Professional Rating Service or Moody's Professional Rating Service), unless otherwise expressly approved in writing by Landlord in its sole and absolute discretion (collectively, the "**L-C Issuer Requirements**"). If at any time: (a) the Bank does not meet any of the L-C Issuer Requirements; (b) the Bank is placed into receivership or conservatorship by the Federal Deposit Insurance Corporation or any state or other governmental agency; or (c) Landlord determines in its sole and absolute discretion that the financial condition of the Bank changes in any materially adverse way, then the L-C shall be deemed to no longer comply with the terms and conditions of the Lease and Tenant shall, within twenty (20) business days following Landlord's notice to Tenant, at in Landlord's reasonable discretion, cause another bank meeting each of the L-C Issuer Requirements set forth herein to issue and deliver to Landlord a replacement L-C that fully complies in all respects with the requirements of this Letter of Credit Rider, provided, however, Tenant may instead elect to deposit with Landlord cash in an amount equal to the L-C Amount which cash shall be deemed L-C Proceeds (as such term is defined below) which Landlord shall be entitled to use and apply in accordance

LETTER OF

CREDIT RIDER

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with this Letter of Credit Rider. If Tenant fails to replace such L-C or deposit cash, as is applicable, pursuant to the terms and conditions of this <u>Section</u> <u>1.2</u>, then, notwithstanding anything in the Lease to the contrary, Landlord shall have the right to draw down on the entirety of the L-C, which cash proceeds shall be deemed L-C Proceeds which Landlord shall be entitled to use and apply in accordance with this <u>Letter of Credit Rider</u>. Tenant shall be responsible for the payment of any and all Tenant's and Bank's costs incurred with the review of any replacement L-C, which replacement is required pursuant to this Letter of Credit Rider or is otherwise requested by Tenant. On issuance and effectiveness of any replacement L-C required or allowed by this Letter of Credit Rider, "Bank" shall mean the issuer of such replacement L-C.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 **<u>L-C Draw Events</u>**. Each of the following events shall constitute an "**L-C Draw Event**": (i) Tenant shall have failed to pay when due any amount due to Landlord under the terms and conditions of the Lease beyond all applicable notice and cure periods (provided, that, if bankruptcy proceedings involving Tenant prohibit Landlord from declaring a default, then no such notice or cure periods are required); (ii) Tenant shall have failed to perform when due any of its obligations in accordance with the terms and conditions of the Lease beyond all applicable notice and cure periods (provided, that, if bankruptcy proceedings involving Tenant prohibit Landlord from declaring a default, then no such notice or cure periods are required); (iii) an Event of Default shall exist under the Lease; (iv) the Lease terminated prior to the expiration of the Term as a result of Tenant's breach or default of any term or provision of the Lease; (v) Tenant has filed a voluntary petition under the United States Bankruptcy Code or has commenced, filed, or initiated any other bankruptcy, receivership, reorganization, insolvency, restructuring, or similar proceeding under any federal, state, or foreign laws or statutes; (vi) an involuntary petition has been filed against Tenant under the United States Bankruptcy Code or Tenant has become the subject of, has commenced against it, or is placed in any other bankruptcy, receivership, reorganization, insolvency, restructuring, or similar proceeding under any federal, state, or foreign laws or statutes that is not dismissed within sixty (60) days; (viii) the Lease has been rejected, repudiated, disaffirmed, or is deemed rejected, repudiated, or disaffirmed in any case commenced under the United States Bankruptcy Code or under any case or proceeding under any similar federal, state, or foreign, laws or statutes; (ix) the Bank has notified Landlord that the L-C will not be renewed or extended through the L-C Expiration Date, and Tenant has not provided a replacement L-C that satisfies the requirements of the Lease at least thirty (30) days prior to such expiration; (x) Tenant has executed an assignment for the benefit of creditors, commenced an involuntary dissolution, become the subject of any involuntary dissolution proceeding, been suspended, or had its entity status has been cancelled otherwise terminated; or (xi) the Bank no longer satisfies any of the L-C Issuer Requirements and Tenant fails to provide a replacement L-C in accordance with the terms of this Letter of Credit Rider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 **<u>L-C Draw(s) and Use and Application of L-C Proceeds</u>**. Upon and at any time after the occurrence of any L-C Draw Event, Landlord, or its then managing agent, shall have the right, but not the obligation and without notice to Tenant, to draw upon the L-C, in whole or in part, in single or multiple draws to use as L-C Proceeds for the purposes provided hereinbelow. Following any draw or draws on the L-C, Landlord, in its sole and absolute discretion and without notice to Tenant, shall have the right at any time to apply any proceeds of L-C received by Landlord on account of any draw or draws (or in the event Tenant is required to deposit cash with Landlord as may be required by <u>Section</u> <u>1.2</u> above) (collectively, the "**L-C Proceeds**") (i) to any and all amounts past due and owing by Tenant under the Lease, (ii) to any and all damages, costs, expenses, claims, liabilities, or other losses of any kind or nature that Landlord suffers, sustains, or incurs, or which Landlord reasonably estimates that it will suffer, sustain, or incur as a result of or related to any breach or default of the Lease by Tenant or the occurrence of any other L-C Draw Event, (iii) to any other amount necessary to compensate Landlord for any and all detriment proximately caused by Tenant's failure to perform its obligations under the Lease or which in the ordinary course of things would likely result therefrom; and/or (iv) to pay, compensate, or reimburse Landlord for any and all

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damages, costs, claims, expenses, liabilities, or other losses Landlord suffers, sustains, or incurs or Landlord reasonably estimates that it will suffer, sustain, or incur that arise out of, or are incurred in connection with, the termination of the Lease, including, without limitation, those damages and losses that Landlord may recover under the Lease and Section 1951.2 of the California Civil Code. The L-C shall be honored by the Bank regardless of whether Tenant disputes Landlord's right to draw upon the L-C. In the event of an assignment by Tenant of its interest in the Lease (and irrespective of whether Landlord's consent is required for such assignment), the acceptance of any replacement or substitute letter of credit by Landlord from the assignee shall be subject to Landlord's prior written approval, in Landlord's reasonable discretion, and the actual and reasonable attorney's fees incurred by Landlord in connection with such determination shall be payable by Tenant to Landlord within ten (10) days of billing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 **<u>Unused/Unapplied L-C Proceeds</u>**. In the event Landlord receives any L-C Proceeds that are not applied or used as provided in <u>Section</u> <u>1.4</u> above (i) any unused or unapplied L-C Proceeds received by Landlord shall constitute Landlord's sole and exclusive property (and not Tenant's property or, in the event of a receivership, conservatorship, or bankruptcy filing by, or on behalf of, Tenant, property of such receivership, conservatorship, or Tenant's bankruptcy estate), (ii) Landlord shall not be required to keep the L-C Proceeds separate or apart from Landlord's general funds or other assets or pay any interest on the L-C Proceeds, (iii) Landlord may, at any time and without notice to Tenant, and without obligation to do so, apply the L-C Proceeds in accordance with <u>Section</u> <u>1.4</u> above, at any time in Landlord's sole and absolute discretion and without notice to Tenant, and (iv) Landlord agrees to pay to Tenant within thirty (30) days after the L-C Expiration Date the amount of any L-C Proceeds actually received by Landlord which are not and cannot be used or applied by Landlord as provided in this Letter of Credit Rider; provided, however, that if prior to the L-C Expiration Date a voluntary or involuntary petition has been filed by or against Tenant under the United States Bankruptcy Code or Tenant has become the subject of, has commenced against it, or is placed in any other bankruptcy, liquidation, receivership, reorganization, insolvency, restructuring, or similar proceedings under any federal, state, or foreign laws, or if Tenant executes an assignment for the benefit of creditors, then Landlord shall not be obligated to make any payment to Tenant in the amount of the unused or unapplied L-C Proceeds until all preference or other avoidance claims and issues relating to payments, damages, losses, and other amounts due under the Lease have been fully and finally resolved. Tenant's obligation to furnish the L-C and any use, application or retention by Landlord of all or any part of the L-C Proceeds shall not be deemed in any way to constitute liquidated damages for any default by Tenant, or to limit the remedies to which Landlord is otherwise entitled under the terms of the Lease and/or applicable law. No trust or fiduciary relationship is created under the Lease or otherwise between Landlord and Tenant with respect to the L-C Proceeds. The use, application or retention of the L-C or L-C Proceeds, or any portion thereof, by Landlord shall not prevent Landlord from exercising any other right or remedy provided by the Lease or by any applicable law, it being intended that Landlord shall not first be required to proceed against the L-C or the L-C Proceeds, and such L-C or L-C Proceeds shall not operate as a limitation on any recovery to which Landlord may otherwise be entitled. Tenant agrees and acknowledges that (a) the L-C constitutes a separate and independent contract between Landlord and the Bank, (b) Tenant is not a third party beneficiary of such contract, (c) Tenant has no property interest whatsoever in the L-C or the proceeds thereof, and (d) in the event Tenant becomes a debtor under any chapter of the Bankruptcy Code, Tenant is placed into receivership or conservatorship, and/or there is an event of a receivership, conservatorship or a bankruptcy filing by, or on behalf of, Tenant, neither Tenant, any trustee, nor Tenant's bankruptcy estate shall have any right to restrict or limit Landlord's claim and/or rights to the L-C and/or the L-C Proceeds by application of Section 502(b)(6) of the United States Bankruptcy Code or otherwise.

LETTER OF

CREDIT RIDER

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 **<u>Replenishment, Renewal and Replacement of L-C</u>**. Tenant shall cause the L-C to be kept and maintained in full force and effect at all times during the Lease Term, as the same may be extended and through and including the L-C Expiration Date, and the Bank shall meet the L-C Issuer Requirements at all times during the Lease Term, as the same may be extended and through and including the L-C Expiration Date. Unless Tenant has a mandatory obligation to replace the L-C as expressly provided herein, Tenant shall have no right to replace the L-C without Landlord's express written consent, which may be withheld by Landlord in its reasonable discretion. The new L-C shall comply with all terms and conditions of the Lease. If, as a result of any drawing by Landlord on the L-C, the amount of the L-C shall at any time be less than the L-C Amount, Tenant shall, within ten (10) days after written notice thereof from Landlord, provide Landlord with: (i) an amendment to the L-C restoring it to the L-C Amount, or (ii) an additional letter of credit in an amount equal to the deficiency, which additional letter of credit shall comply with all of the provisions of the Lease. If the L-C expires at any time earlier than the L-C Expiration Date, Tenant shall cause the Bank to deliver a certificate of renewal or extension of the L-C to Landlord at least thirty (30) days prior to the expiration of the L-C then held by Landlord, without any action whatsoever on the part of Landlord. In furtherance of the foregoing, if the L-C has an expiration date prior to the L-C Expiration Date, Tenant shall cause the L-C to contain a so-called "evergreen provision," whereby the L-C shall automatically be renewed, without amendment, unless at least thirty (30) days' prior written notice of non-renewal is first provided by the Bank to Landlord. Notwithstanding anything in the Lease to the contrary, Tenant's failure to timely provide Landlord with a renewed L-C, amended L-C, additional L-C or replacement L-C as and when required (<u>i.e.</u>, within the requisite time periods) under this Letter of Credit Rider, shall constitute an Event of Default for which there shall be no notice or grace or cure periods applicable thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 **<u>L-C Amount; Maintenance of L-C by Tenant</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7.1 **<u>L-C Amount</u>**. The L-C Amount shall be equal to the amount set forth in <u>Section</u> <u>8</u> of the Summary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7.2 **<u>In General</u>**. Tenant further covenants and warrants that shall have no rights to either assign or encumber the L-C, the L-C Proceeds or any part thereof and that neither Landlord nor its successors or assigns will be bound by any such assignment, encumbrance, attempted assignment or attempted encumbrance. If Tenant exercises its option to extend the Lease Term pursuant to <u>Section</u> <u>2.2</u> above then, not later than thirty (30) days prior to the commencement of the Option Term, Tenant shall deliver to Landlord a new L-C or certificate of renewal or extension evidencing the L-C Expiration Date as sixty (60) days after the expiration of the Option Term. Notwithstanding anything to the contrary herein, (i) if Landlord draws on the L-C due to Tenant's violation of the Lease beyond applicable notice and cure periods, such draw shall be in the amount required to cure such default, and (ii) if Landlord draws on the L-C due to Tenant's failure to timely renew or provide a replacement L-C, such failure shall not be considered a default under the Lease and Landlord shall return such cash proceeds upon Tenant's presentation of a replacement L-C that satisfies the requirements of the Lease, subject to reasonable satisfaction of any preference risk to Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 **<u>Transfer and Encumbrance</u>**. The L-C shall also provide that Landlord may, at any time and without notice to Tenant and without first obtaining Tenant's consent thereto, transfer (one or more times) all or any portion of its interest in and to the L-C to another party, person or entity, regardless of whether or not such transfer is from or as a part of the assignment by Landlord of its rights and interests in and to the Lease. In the event of a transfer of Landlord's interest in under the Lease, Landlord shall transfer the L-C, in whole or in part, to the transferee and thereupon Landlord shall, without any further agreement between the parties, be released by Tenant from all liability therefor, and it is agreed that the provisions hereof shall apply to every transfer or assignment of the whole of said LC to a new landlord. In connection with any such transfer of the L-C by Landlord, Tenant shall, at Tenant's sole cost and expense, execute and

LETTER OF

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submit to the Bank such applications, documents and instruments as may be necessary to effectuate such transfer and, Tenant shall be responsible for paying the Bank's transfer and processing fees in connection therewith; provided that, Landlord shall have the right (in its sole discretion), but not the obligation, to pay such fees on behalf of Tenant, in which case Tenant shall reimburse Landlord within ten (10) days after Tenant's receipt of an invoice from Landlord therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9 **<u>L-C Not a Security Deposit</u>**. Landlord and Tenant (1) acknowledge and agree that in no event or circumstance shall the L-C, the L-C Proceeds, or any renewal thereof or substitute therefor be deemed to be or treated as a "security deposit" under any law applicable to security deposits in the commercial context, including, but not limited to, Section 1950.7 of the California Civil Code, as such Section now exists or as it may be hereafter amended or succeeded (the "**Security Deposit Laws**"), (2) acknowledge and agree that the L-C and the L-C Proceeds (including any renewal thereof or substitute therefor or any proceeds thereof) are not intended to serve as a security deposit, and the Security Deposit Laws shall have no applicability or relevancy thereto, and (3) waive any and all rights, duties and obligations that any such party may now, or in the future will, have relating to or arising from the Security Deposit Laws. Tenant hereby irrevocably waives and relinquishes the provisions of Section 1950.7 of the California Civil Code and any successor statute, and all other provisions of law, now or hereafter in effect, which (x) establish the time frame by which a landlord must refund a security deposit under a lease, and/or (y) provide that a landlord may claim from a security deposit only those sums reasonably necessary to remedy defaults in the payment of rent, to repair damage caused by a tenant or to clean the premises, it being agreed that Landlord may, in addition, claim those sums specified in this Letter of Credit Rider and/or those sums reasonably necessary to (a) compensate Landlord for any loss or damage caused by Tenant's breach of the Lease, including any damages Landlord suffers following termination of the Lease, and/or (b) compensate Landlord for any and all damages arising out of, or incurred in connection with, the termination of the Lease, including, without limitation, those specifically identified in Section 1951.2 of the California Civil Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10 **<u>Non-Interference By Tenant</u>**. Tenant agrees not to interfere in any way with any payment to Landlord of the proceeds of the L-C, either prior to or following a "draw" by Landlord of all or any portion of the LC, regardless of whether any dispute exists between Tenant and Landlord as to Landlord's right to draw down all or any portion of the L-C. No condition or term of the Lease shall be deemed to render the L-C conditional and thereby afford the Bank a justification for failing to honor a drawing upon such L-C in a timely manner. Tenant shall not request or instruct the Bank of any L-C to refrain from paying sight draft(s) drawn under such L-C.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11 **<u>Waiver of Certain Relief</u>**. Tenant unconditionally and irrevocably waives (and as an independent covenant hereunder, covenants not to assert) any right to claim or obtain any of the following relief in connection with the L-C or the L-C Proceeds:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11.1 A temporary restraining order, temporary injunction, permanent injunction, or other order that would prevent, restrain or restrict the presentment of sight drafts or demands for payment drawn under any L-C or the Bank's honoring or payment of sight draft(s); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11.2 Any attachment, garnishment, or levy in any manner upon either the L-C Proceeds or the obligations of the Bank (either before or after the presentment to the Bank of sight drafts drawn under such L-C) based on any theory whatever.

LETTER OF

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12 **<u>Remedy for Improper Drafts</u>**. Tenant's sole remedy in connection with the improper draw, presentment or payment related to the L-C, or Landlord's use or application of any L-C Proceeds, shall be the right to obtain from Landlord a refund of any L-C Proceeds that were actually received by Landlord and improperly used or applied under this Letter of Credit Rider, together with interest at the Interest Rate and reasonable actual out-of-pocket attorneys' fees, provided that at the time of such refund, Tenant, to the extent otherwise required pursuant to this Letter of Credit Rider, first increases the amount of such L-C to the amount (if any) then required under the applicable provisions of the Lease or provide a Landlord with a replacement letter of credit in the L-C Amount then in effect that complies in full with all the terms and conditions of the Lease. Tenant acknowledges that the presentment of sight drafts drawn under any L-C or any demand for payment under the L-C, or the Bank's payment of sight drafts or demands for payment drawn under the L-C, could not under any circumstances cause Tenant injury that could not be remedied by an award of money damages, and that the recovery of money damages would be an adequate remedy therefor. In the event Tenant shall be entitled to a refund as aforesaid and Landlord shall fail to make such payment within ten (10) business days after demand, Tenant shall have the right to deduct the amount thereof together with interest thereon at the Interest Rate from the next installment(s) of Base Rent.

LETTER OF

CREDIT RIDER

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**<u>SCHEDULE 1 TO LETTER OF CREDIT RIDER</u>**

**<u>FORM OF LETTER OF CREDIT</u>**

ISSUING BANK:

**BANK OF AMERICA, N.A.** 

**ONE FLEET WAY** 

**PA6-580-02-30** 

**SCRANTON, PA 18507-1999** 

SWIFT: BOFAUS3N

BENEFICIARY:

**HCP OYSTER POINT III, LLC** 

C/O Healthpeak OP, LLC

3000 Meridian Boulevard, Suite 200

Franklin, TN 37067

Attn: Legal Department

APPLICANT:

ENCARDA THERAPEUTICS, INC.

131 OYSTER POINT BOULEVARD, #2

SOUTH SAN FRANCISCO, CALIFORNIA 94080

AMOUNT: USD413,344.50 (FOUR HUNDRED THIRTEEN THOUSAND THREE

HUNDRED FORTY-FOUR AND 50/100 U.S. DOLLARS)

EXPIRATION DATE: 12 MONTHS FROM ISSUANCE

WE HEREBY ISSUE THIS IRREVOCABLE STANDBY LETTER OF CREDIT NO. ————— IN YOUR FAVOR, FOR THE ACCOUNT OF THE APPLICANT, EFFECTIVE IMMEDIATELY, FOR A SUM NOT EXCEEDING FOUR HUNDRED THIRTEEN THOUSAND THREE HUNDRED FORTY-FOUR AND 50/100 U.S. DOLLARS (USD413,344.50) WHICH EXPIRES ON ———— AT OUR OFFICE AND AVAILABLE BY YOUR DRAFT(S) DRAWN ON US AT SIGHT, IN THE FORM OF EXHIBIT "A" ATTACHED AND ACCOMPANIED BY THE FOLLOWING DOCUMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. BENEFICIARY'S DATED AND SIGNED STATEMENT, STATING ANY ONE OF THE FOLLOWING WITH INSTRUCTIONS IN BRACKETS
THEREIN COMPLETED:

"THE UNDERSIGNED HEREBY CERTIFIES THAT BENEFICIARY, EITHER (A) UNDER THE LEASE (DEFINED BELOW), OR (B) AS A RESULT OF THE TERMINATION OF SUCH LEASE HAS THE RIGHT TO DRAW DOWN THE AMOUNT OF USD ———— IN ACCORDANCE WITH THE TERMS OF THAT

LETTER OF

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CERTAIN OFFICE LEASE DATED ———— BY AND BETWEEN BENEFICIARY AND APPLICANT (OR THE SUCESSOR-IN-INTEREST TO THE ORIGINAL TENANT OF SUCH LEASE), AS THE SAME MAY HAVE BEEN AMENDED (COLLECTIVELY, THE "LEASE"), OR SUCH AMOUNT CONSTITUTES DAMAGES OWING BY THE TENANT TO THE BENEFICIARY RESULTING FROM THE BREACH OF SUCH LEASE, AND SUCH AMOUNT REMAINS UNPAID AT THE TIME OF THIS DRAWING." OR

"THE UNDERSIGNED HEREBY CERTIFIES THAT BENEFICIARY HAS RECEIVED A WRITTEN NOTICE OF BANK OF AMERICA, N.A.'S ELECTION NOT TO EXTEND ITS STANDBY LETTER OF CREDIT NO. ———— AND LESS THAN SIXTY (60) DAYS REMAIN PRIOR TO THE EXPIRATION OF SUCH LETTER OF CREDIT." OR

"THE UNDERSIGNED HEREBY CERTIFIES THAT BENEFICIARY IS ENTITLED TO DRAW DOWN THE FULL AMOUNT OF LETTER OF CREDIT NO. ———--AS A RESULT OF THE FILING OF A VOLUNTARY PETITION UNDER THE U.S. BANKRUPTCY CODE OR STATE BANKRUPTCY CODE BY TENANT UNDER THAT CERTAIN OFFICE LEASE DATED ———— BY AND BETWEEN BENEFICIARY AND APPLICANT (OR THE SUCCESSOR-IN-INTEREST TO THE ORIGINAL TENANT OF SUCH OFFICE LEASE), AS THE SAME MAY HAVE BEEN AMENDED (COLLECTIVELY, THE "LEASE"), WHICH FILING HAS NOT BEEN DISMISSED AT THE TIME OF THIS DRAWING." OR

"THE UNDERSIGNED HEREBY CERTIFIES THAT BENEFICIARY IS ENTITLED TO DRAW DOWN THE FULL AMOUNT OF LETTER OF CREDIT NO. ———— AS A RESULT OF THE FILING OF AN INVOLUNTARY PETITION UNDER THE U.S. BANKRUPTCY CODE OR A STATE BANKRUPTCY CODE AGAINST THE TENANT UNDER THAT CERTAIN OFFICE LEASE DATED ———— BY AND BETWEEN BENEFICIARY AND APPLICANT (OR THE SUCCESSOR-IN-INTEREST TO THE ORIGINAL TENANT OF SUCH OFFICE LEASE), AS THE SAME MAY HAVE BEEN AMENDED (COLLECTIVELY, THE "LEASE"), WHICH FILING HAS NOT BEEN DISMISSED AT THE TIME OF THIS DRAWING." OR

"THE UNDERSIGNED HEREBY CERTIFIES THAT BENEFICIARY IS ENTITLED TO DRAW DOWN THE FULL AMOUNT OF LETTER OF CREDIT NO. ———— AS THE RESULT OF THE REJECTION OR DEEMED REJECTION, OF THAT CERTAIN OFFICE LEASE DATED ———— BY AND BETWEEN BENEFICIARY AND APPLICANT (OR THE SUCCESSOR-IN-INTEREST TO THE ORIGINAL TENANT OF SUCH OFFICE LEASE), AS THE SAME MAY HAVE BEEN AMENDED (COLLECTIVELY, THE "LEASE"), UNDER SECTION 365 OF THE U.S. BANKRUPTCY CODE."

LETTER OF

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PARTIAL DRAWINGS AND MULTIPLE PRESENTATIONS ARE ALLOWED.

IT IS A CONDITION OF THIS LETTER OF CREDIT THAT IT IS DEEMED TO BE AUTOMATICALLY EXTENDED WITHOUT AMENDMENT FOR PERIOD (S) OF ONE YEAR EACH FROM THE CURRENT EXPIRATION DATE HEREOF, OR ANY FUTURE EXPIRATION DATE, UNLESS AT LEAST SIXTY (60) DAYS PRIOR TO ANY EXPIRATION DATE, WE NOTIFY YOU IN WRITING BY REGISTERED MAIL OR OVERNIGHT COURIER AT THE ABOVE LISTED ADDRESS THAT WE ELECT NOT TO CONSIDER THIS LETTER OF CREDIT EXTENDED FOR ANY SUCH ADDITIONAL PERIOD. HOWEVER, IN NO EVENT SHAL<u>L</u> THIS LETTER OF CREDIT BE AUTOMATICALLY EXTENDED BEYOND FEBRUARY 28, 2029.

ANY SUCH NOTICE SHALL BE EFFECTIVE WHEN SENT BY US AND UPON SUCH NOTICE TO YOU, YOU MAY DRAW AT ANY TIME PRIOR TO THE THEN CURRENT EXPIRATION DATE, UP TO THE FULL AMOUNT THEN AVAILABLE HEREUNDER, AGAINST YOUR DRAFT (S) DRAWN ON US AT SIGHT ACCOMPANIED BY YOUR STATEMENT, SIGNED AND DATED BY AN AUTHORIZED SIGNATORY, STATED ABOVE.

THIS LETTER OF CREDIT IS TRANSFERABLE IN FULL AND NOT IN PART. ANY TRANSFER MADE HEREUNDER MUST CONFORM STRICTLY TO THE TERMS HEREOF AND TO THE CONDITIONS OF RULE 6 OF THE INTERNATIONAL STANDBY PRACTICES (ISP98) FIXED BY THE INTERNATIONAL CHAMBER OF COMMERCE, PUBLICATION NO. 590.

SHOULD YOU WISH TO EFFECT A TRANSFER UNDER THIS CREDIT, SUCH TRANSFER WILL BE SUBJECT TO THE RETURN TO US OF THE ORIGINAL CREDIT INSTRUMENT, ACCOMPANIED BY OUR FORM OF TRANSFER, PROPERLY COMPLETED AND SIGNED BY AN AUTHORIZED SIGNATORY OF YOUR FIRM, BEARING YOUR BANKERS STAMP AND SIGNATURE AUTHENTICATION. ALL CHARGES ARE FOR THE ACCOUNT OF THE APPLICANT. SUCH TRANSFER FORM IS ATTACHED AS EXHIBIT "B".

PRESENTATION OF SUCH DRAFT (S) AND DOCUMENT (S) MAY BE MADE AT OUR OFFICE LOCATED AT BANK OF AMERICA, N.A., 1 FLEET WAY, MC: PA6-580-02-30, SCRANTON, PA 18507-1999, BY OVERNIGHT COURIER, OR BY TELECOPY TO FACSIMILE NO. 800-755-8743, CONFIRMED BY TELEPHONE TO 800-370-7519. IF PRESENTED BY FAX, DOCUMENTS ARE NOT REQUIRED TO BE SENT BY COURIER.

WE HEREBY AGREE WITH YOU THAT DRAFT (S) DRAWN UNDER AND IN COMPLIANCE WITH THE TERMS OF THIS LETTER OF CREDIT SHALL BE DULY HONORED UPON DUE PRESENTATION TO US ON OR BEFORE THE EXPIRATION DATE OR ANY AUTOMATICALLY EXTENDED EXPIRATION DATE OF THIS LETTER OF CREDIT.

LETTER OF

CREDIT RIDER

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IN THE EVENT THAT THE ORIGINAL OF THIS STANDBY LETTER OF CREDIT IS LOST, STOLEN, MUTILATED, OR OTHERWISE DESTROYED, WE HEREBY AGREE TO ISSUE A CERTIFIED TRUE COPY OF THE ORIGINAL HEREOF UPON RECEIPT OF A WRITTEN INDEMNIFICATION FORM ACCEPTABLE TO US (SUCH FORM IS AVAILABLE UPON REQUEST).

IF DEMAND FOR PAYMENT IS MADE BY 10:00 AM EASTERN TIME IN CONFORMITY WITH THE TERMS AND CONDITIONS HEREOF, PAYMENT SHALL BE MADE TO BENEFICIARY ON THE SECOND BUSINESS DAY, IF DEMAND FOR PAYMENT IS MADE AFTER 10:00 AM EASTERN TIME IN CONFORMITY WITH THE TERMS AND CONDITIONS HEREOF, PAYMENT SHALL BE MADE TO BENEFICIARY ON THE THIRD BUSINESS DAY.

AS USED IN THIS LETTER OF CREDIT "BUSINESS DAY" SHALL MEAN ANY DAY OTHER THAN A SATURDAY, SUNDAY OR A DAY ON WHICH BANKING INSTITUTIONS IN PENNSYLVANIA ARE REQUIRED OR AUTHORIZED TO CLOSE.

THIS LETTER OF CREDIT IS SUBJECT TO THE INTERNATIONAL STANDBY PRACTICES (ISP98), INTERNATIONAL CHAMBER OF COMMERCE PUBLICATION NO.

IF YOU REQUIRE ANY ASSISTANCE OR HAVE ANY QUESTIONS REGARDING THIS TRANSACTION PLEASE CALL 800-370-7519.

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| |
|:---|
| BANK OF AMERICA, N.A. |
| AUTHORIZED SIGNATURE |
| DATE: |
| NAME: |
| TITLE: |

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LETTER OF

CREDIT RIDER

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**EXHIBIT A** 

**BANK OF AMERICA, N.A. LETTER OF CREDIT NUMBER—————<u> </u>** 

**FACE OF THE DRAFT** 

USD:

DATE:

AT SIGHT PAY TO THE ORDER OF ——————— (AMOUNT IN WORDS) US DOLLARS DRAWN UNDER BANK OF AMERICA IRREVOCABLE LETTER OF CREDIT NO. ——————- DATED —————.

TO: BANK OF AMERICA

1 FLEET WAY

SCRANTON, PA 18507-1999

ATTN: GLOBAL TRADE OPERATIONS

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| |
|:---|
| BENEFICIARY NAME (FILL IN) |
| AUTHORIZED SIGNATURE<br> BACK OF DRAFT |
| BENEFICIARY NAME (FILL IN) |
| AUTHORIZED SIGNATURE |

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LETTER OF

CREDIT RIDER

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**<u>LEASE</u>**

**THE COVE** 

**HCP OYSTER POINT III, LLC**, a Delaware limited liability company,

as Landlord,

and

**ENCARDA, INC.,** 

a Delaware corporation,

as Tenant.

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**<u>**TABLE OF CONTENTS**</u>**

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| | | |
|:---|:---|:---|
|  |  | **Page** |
| 1. | PREMISES, BUILDING, PROJECT, AND COMMON AREAS | 5 |
| 2. | LEASE TERM; OPTION TERM | 12 |
| 3. | BASE RENT | 16 |
| 4. | ADDITIONAL RENT | 16 |
| 5. | USE OF PREMISES | 26 |
| 6. | SERVICES AND UTILITIES | 33 |
| 7. | REPAIRS | 36 |
| 8. | ADDITIONS AND ALTERATIONS | 37 |
| 9. | COVENANT AGAINST LIENS | 39 |
| 10. | INSURANCE | 40 |
| 11. | DAMAGE AND DESTRUCTION | 43 |
| 12. | NONWAIVER | 45 |
| 13. | CONDEMNATION | 45 |
| 14. | ASSIGNMENT AND SUBLETTING | 46 |
| 15. | SURRENDER OF PREMISES; OWNERSHIP AND REMOVAL OF TRADE FIXTURES | 51 |
| 16. | HOLDING OVER | 53 |
| 17. | ESTOPPEL CERTIFICATES; FINANCIAL STATEMENTS | 54 |
| 18. | SUBORDINATION | 54 |
| 19. | DEFAULTS; REMEDIES | 55 |
| 20. | COVENANT OF QUIET ENJOYMENT | 60 |
| 21. | INTENTIONALLY OMITTED | 60 |
| 22. | COMMUNICATIONS AND COMPUTER LINES | 60 |
| 23. | SIGNS | 60 |
| 24. | COMPLIANCE WITH LAW | 61 |
| 25. | LATE CHARGES | 62 |
| 26. | LANDLORD'S RIGHT TO CURE DEFAULT; PAYMENTS BY TENANT | 63 |
| 27. | ENTRY BY LANDLORD | 63 |
| 28. | TENANT PARKING | 64 |
| 29. | MISCELLANEOUS PROVISIONS | 64 |

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EXHIBITS

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| | |
|:---|:---|
| A | OUTLINE OF PREMISES |
| B | TENANT WORK LETTER |
| C | LIST OF EXISTING FURNITURE |
| D | FORM OF TENANT'S ESTOPPEL CERTIFICATE |
| E | ENVIRONMENTAL QUESTIONNAIRE |

---

LETTER OF CREDIT RIDER

------

**<u>INDEX</u>**

---

| | |
|:---|:---|
|  | **Page(s)** |
|  Abatement Event | 43 |
|  Additional Notice | 43 |
|  Advocate Arbitrators | 11 |
|  Alterations | 27 |
|  Base Rent | 12 |
|  Brokers | 52 |
|  Building | 6 |
|  Building Structure | 26 |
|  Building Systems | 26 |
|  Casualty | 31 |
|  Common Areas | 7 |
|  Comparable Buildings | 10 |
|  Contemplated Effective Date | 36 |
|  Contemplated Transfer Space | 36 |
|  Delivery Date | 4 |
|  Direct Expenses | 13 |
|  Estimate | 18 |
|  Estimate Statement | 18 |
|  Estimated Direct Expenses | 18 |
|  Existing Hazardous Materials | 22 |
|  Expense Year | 13 |
|  Force Majeure | 49 |
|  HVAC | 24 |
|  Initial Notice | 43 |
|  Intention to Transfer Notice | 36 |
|  Landlord | 1 |
|  Landlord Parties | 29 |
|  Landlord Repair Notice | 32 |
|  L-C | 1 |
|  L-C Amount | 1 |
|  Lease | 1 |
|  Lease Commencement Date | 9 |
|  Lease Expiration Date | 9 |
|  Lease Term | 9 |
|  Lease Year | 9 |
|  Lines | 44 |
|  Mail | 49 |
|  Management Fee Cap | 15 |
|  Net Worth | 37 |
|  Neutral Arbitrator | 11 |
|  Nine Month Period | 36 |
|  Notices | 49 |
|  Objectionable Name | 44 |

---

------

---

| | | |
|:---|:---|:---|
|  | **Page(s)** | **Page(s)** |
|  Operating Expenses |  | 13 |
|  Option Rent |  | 10 |
|  Original Improvements |  | 30 |
|  Outside Agreement Date |  | 10 |
|  Premises |  | 4 |
|  Project |  | 6 |
|  Sign Specifications |  | 44 |
|  Statement |  | 18 |
|  Subject Space |  | 34 |
|  Summary |  | 1 |
|  Tax Expenses |  | 16 |
|  Tenant |  | 1 |
|  Tenant Work Letter |  | 4 |
|  Tenant's Share |  | 17 |
|  Transfer Notice |  | 34 |
|  Transferee |  | 34 |

---

## Exhibit 10.19

**Exhibit 10.19** 

LEASE AND LEASE AGREEMENT

Between

**CARNEGIE 506 ASSOCIATES** 

The Landlord

And

**KARDIGAN BIO** 

The Tenant

For Leased Premises In

506 Carnegie Center

Princeton, New Jersey

February 18, 2025

Prepared by:

[\*\*\*]

------

**TABLE OF CONTENTS**

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| | | |
|:---|:---|:---|
|  |  | **Page** |
| 1. | Definitions | 1 |
| 2. | Lease of the Leased Premises | 1 |
| 3. | Rent | 1 |
| 4. | Term | 3 |
| 5. | Preparation of the Leased Premises | 3 |
| 6. | Options | 4 |
| 7. | Use and Occupancy | 5 |
| 8. | Utilities, Services, Maintenance and Repairs | 7 |
| 9. | Allocation of the Expense of Utilities, Services, Maintenance, Repairs and Taxes | 9 |
| 10. | Computation and Payment of Allocated Expenses of Utilities, Services, Maintenance, Repairs, Taxes and Capital Expenditures | 9 |
| 11. | Leasehold Improvements, Fixtures and Trade Fixtures | 16 |
| 12. | Alterations, Improvements and Other Modifications by the Tenant | 16 |
| 13. | Landlord's Rights of Entry and Access | 18 |
| 14. | Liabilities and Insurance Obligations | 19 |
| 15. | Casualty Damage to Building or Leased Premises | 23 |
| 16. | Condemnation | 25 |
| 17. | Assignment or Subletting by Tenant | 26 |
| 18. | Signs, Displays and Advertising | 29 |
| 19. | Quiet Enjoyment | 29 |
| 20. | Relocation | 30 |
| 21. | Surrender | 30 |
| 22. | Events of Default | 30 |
| 23. | Rights and Remedies | 31 |
| 24. | Termination of the Term | 34 |
| 25. | Mortgage and Underlying Lease Priority | 35 |
| 26. | Transfer by Landlord | 35 |
| 27. | Indemnification | 36 |
| 28. | Parties' Liability | 38 |
| 29. | Security Deposit | 39 |
| 30. | Representations | 40 |
| 31. | Reservation in Favor of Tenant | 41 |
| 32. | Tenant's Certificates and Mortgagee Notice Requirements | 41 |
| 33. | Appraisal, Waiver of Jury Trial and Arbitration | 43 |
| 34. | Severability | 43 |
| 35. | Notices | 43 |
| 36. | Captions | 44 |
| 37. | Counterparts | 44 |
| 38. | Applicable Law | 44 |
| 39. | Exclusive Benefit | 44 |
| 40. | Successors | 44 |
| 41. | Amendments | 44 |
| 42. | Waiver | 44 |
| 43. | Course of Performance | 44 |
| 44. | Landlord's Concessions | 44 |
| 45. | Electronic Signatures | 48 |

---

i

------

TABLE OF EXHIBITS

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| | |
|:---|:---|
|  | **Exhibit** |
| Leased Premises Floor Space Diagram | A |
| Property Description | B |
| Building Description | C |
| Building Rules and Regulations | D |
| Definitions and Index of Definitions | E |
| Janitorial Services Description | F |
| Additional Insureds | G-1 |
| Form of Certificate of Liability Insurance | G-2 |
| Form of Certificate of Property Insurance | G-3 |
| Space Plan | H |

---

ii

------

LEASE AND LEASE AGREEMENT, dated as of February 18, 2025, between CARNEGIE 506 ASSOCIATES, a New Jersey general partnership, with offices c/o Boston Properties, 101 Carnegie Center, Suite 104, Princeton, New Jersey 08540 (the "Landlord"), and KARDIGAN BIO, a Delaware corporation, with its principal office prior to the Commencement Date at 100 Overlook Center, Second Floor, Princeton, New Jersey 08540, and after the Commencement Date at the Leased Premises (the "Tenant").

Subject to all the terms and conditions set forth below, the Landlord and the Tenant hereby agree as follows:

1. <u>Definitions</u>. Certain terms and phrases used in this Agreement (generally those whose first letters are capitalized) are defined in Exhibit E attached hereto and, as used in this Agreement, they shall have the respective meanings assigned or referred to in that exhibit.

2. <u>Lease of the Leased Premises</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 The Landlord shall, and hereby does, lease to the Tenant, and the Tenant shall, and hereby does, accept and lease from the Landlord, the Leased Premises during the Term. The Leased Premises consist of 21,489 square feet of gross rentable floor space on the second floor of 506 Carnegie Center, as more fully described in the definition of Leased Premises set forth in Exhibit E attached hereto. Tenant shall have access to the Leased Premises 24 hours per day, 7 days per week through card key access.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 The Landlord shall, and hereby does, grant to the Tenant, and the Tenant shall, and hereby does, accept from the Landlord, the non-exclusive right to use the Common Facilities during the Term for itself, its employees, other agents and Guests in common with the Landlord, any tenants of Other Leased Premises, any of their respective employees, other agents and guests and such other persons as the Landlord may, in the Landlord's sole discretion, determine from time to time.

3. <u>Rent</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 The Tenant shall punctually pay the Rent for the Leased Premises for the Term to the Landlord in the amounts and at the times set forth below, without bill or other demand and without any offset, deduction or, except as may be otherwise specifically set forth in this Agreement, abatement whatsoever.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 The Basic Rent for the Leased Premises during the Initial Term shall be at the rate per year set forth below:

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| | |
|:---|:---|
| Period | Annual Rental Rate |
|  Rent Concession Period | $0.00 |
|  Rent Commencement Date through Lease Year One | $752115.00 |
|  Lease Year Two | $762859.50 |
|  Lease Year Three | $773604.00 |
|  Lease Year Four | $784348.50 |
|  Lease Year Five | $795093.00 |
|  Lease Year Six | $805837.50 |
|  Lease Year Seven | $816582.00 |

---

------

The annual rate of Basic Rent for the Leased Premises during any Renewal Term shall be calculated as set forth in subsection 6.3 of this Agreement for the respective Renewal Term. Tenant shall pay janitorial and Tenant Electric charges during the Rent Concession Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 The Tenant shall punctually pay the applicable Basic Rent in equal monthly installments in advance on the first day of each month during the Term, with the exception of Basic Rent for the first full calendar month of the Term and for any period of less than a full calendar month at the beginning of the Term. The Tenant shall pay the Basic Rent for the first full calendar month of the Term upon execution and delivery of this Agreement. The Tenant shall punctually pay the Basic Rent for a period of less than a full calendar month at the beginning of the Term on the Commencement Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4 The Basic Rent and the Additional Rent for any period of less than a full calendar month shall be prorated. In the event that any installment of Basic Rent cannot be calculated by the time payment is due, such portion as is then known or calculable shall be then due and payable; and the balance shall be due upon the Landlord's giving notice to the Tenant of the amount of the balance due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 The Additional Rent for the Leased Premises during the Term shall be promptly paid by the Tenant in the respective amounts and at the respective times set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6 That portion of any amount of Rent or other amount due under this Agreement which is not paid on the day it is first due shall incur a late charge equal to the sum of: (i) five (5%) percent of that portion of any amount of Rent or other amount due under this Agreement which is not paid on the day it is first due and (ii) interest on that portion of any amount of Rent or other amount due under this Agreement which is not paid on the day it is first due at the Base Rate(s) in effect from time to time plus two (2) additional percentage points from the day such portion is first due through the day of receipt thereof by the Landlord. Any such late charge due from the Tenant shall be due immediately. Notwithstanding the foregoing to the contrary, Landlord shall not charge such sums in (i) or (ii) above the first time in any Lease Year that Tenant fails to pay Rent when due, so long as Tenant pays such Rent within five (5) days after written notice from Landlord that such Rent is past due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7 Any amount of Rent or other amount which is due upon execution and delivery of this Agreement shall be paid by the Tenant to the Landlord through the BXP on-line Tenant Portal for which an invite will be sent to Tenant from the VersaPay ARC platform from the email address [\*\*\*] (please contact Landlord at [\*\*\*] with any inquiries respecting VersaPay); or either (i) electronic funds (ACH) transfer to [\*\*\*], (ii) overnight courier to [\*\*\*], or (iii) mail to [\*\*\*]. By notice to the Tenant from time to time, the Landlord may change the foregoing payment instructions with regard to amounts not previously paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.8 If any sum payable by the Tenant under this Agreement is paid by check which is returned due to insufficient funds, stop payment order, or otherwise, then: (a) such event shall be treated as a failure to pay such sum when due; and (b) in addition to all other rights and remedies of the Landlord hereunder, the Landlord shall be entitled (i) to impose a returned check charge of Fifty Dollars ($50.00) to cover the Landlord's administrative expenses and overhead for processing, and (ii) after the second occurrence of a returned check in any twelve (12) month period, or after a third occurrence over the Term, to require that all future payments be remitted by wire transfer, money order, or cashier's or certified check.

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4. <u>Term</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 The Initial Term shall commence on the Commencement Date and shall continue for seven (7) years and six (6) full Calendar months, unless sooner terminated in accordance with section 24 of this Agreement. The Term shall commence on the Commencement Date and shall continue until the later of the conclusion of the Initial Term or the conclusion of any Renewal Term, unless sooner terminated in accordance with section 24 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 Unless the condition contemplated by subsection 4.3 of this Agreement occurs, the Commencement Date shall be the Substantial Completion Date, adjusted to an earlier date to compensate the Landlord for the cumulative number of days of Tenant Delay. On the Substantial Completion Date, Landlord shall deliver the Premises to Tenant broom clean and free of hazardous materials, debris, and the personal property and occupancy rights of others. If Landlord does not Substantially Complete Landlord's Work and deliver the Premises to Tenant within three hundred (300) days of the full execution of the Lease, then for each day thereafter until such time as the Premises are delivered to Tenant with Landlord's Work Substantially Complete, Tenant shall be relieved of its obligation to pay the License Fee pursuant to that certain License Agreement with Landlord's Affiliate until such time as Landlord's Work is Substantially Complete. In addition to Landlord's Work obligations, Landlord shall be responsible, at its sole cost and expense, to deliver the Common Areas and all Building systems, including without limitation, HVAC, plumbing, electrical and life safety/security, in full compliance with applicable building codes and regulations, and in good working order and condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 In the event the Tenant takes possession of, or occupies, the Leased Premises for the conduct of business earlier than the Substantial Completion Date, the Commencement Date shall be the first date of such earlier taking of possession or occupancy, as adjusted to an earlier date to compensate the Landlord for the cumulative number of days of Tenant Delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 The Rent Commencement Date shall be that date which is the day immediately following the expiration of the "Rent Concession Period", as hereinafter defined. The period from and including the Commencement Date through the day preceding the Rent Commencement Date (the "Rent Concession Period") shall be six (6) full calendar months.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 Once it is ascertained in accordance with subsections 4.2, 4.3 and 4.4 of this Agreement, the Landlord shall give prompt notice of the Commencement Date and the Rent Commencement Date to the Tenant; and if the Tenant does not object thereto by notice given to the Landlord within ten (10) days of the Landlord's notice, the date set forth in the Landlord's notice shall thereafter be conclusively presumed to be the Commencement Date and the Rent Commencement Date.

5. <u>Preparation of the Leased Premises</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 The Landlord shall perform, at the Landlord's sole cost and expense, the Landlord's Work. Otherwise, the Tenant shall accept the Leased Premises on the Commencement Date in its then "AS IS" condition. The Landlord's Work shall mean, using Building Standard materials and methods, (a) performing the alterations, improvements and other modifications to the Leased Premises as shown on the space plan prepared by Ware Malcomb, a copy of which is attached hereto as Exhibit H (the "Space Plan"); (b) installing new double glass doors at the suite entry; (c) installing new carpet tiles throughout het Leased Premises; (d) new building standard paint throughout the Leased Premises; (e) installing new LED light fixtures throughout the Leased Premises; (f) installing new millwork/pantry area as shown on the Space Plan; (g) installing adequate electrical drops/outlets for 100+/- seats; (h) installing insulation above each office per the Space Plan; and (i) installing new demountable partition office fronts as shown on the Space

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Plan. The Tenant shall select the single color of paint to be applied, and the carpeting and the VCT flooring, if any, to be installed as part of the Landlord's Work from the Landlord's samples within fourteen (14) days after the later to occur of (i) the execution and delivery to the Landlord of this Agreement by the Tenant, and (ii) the execution and delivery to the Tenant of this Agreement by the Landlord. The design and construction of any alterations, improvements or other modifications to the Leased Premises in addition to the Landlord's Work made at the request of the Tenant shall be at the sole cost and expense of the Tenant. The Tenant shall pay such additional design and construction costs to the Landlord within thirty (30) days after the invoicing therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 The Tenant, using its own contractors, desires to install telecommunications and data wiring and cabling, and furniture, fixtures and equipment in the Leased Premises prior to the Substantial Completion Date. The Landlord shall give to the Tenant at least fourteen (14) days' advance notice of the Landlord's projected date of the Substantial Completion Date granting access to the Leased Premises to the Tenant and its contractors to perform such installations. The Tenant and its contractors may have access to the Leased Premises prior to the Substantial Completion Date to perform such installations provided that the Tenant (i) complies with its obligations under section 12 and 14 of this Agreement, and (ii) hereby acknowledges that such access and installation may cause Tenant Delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 The Tenant shall timely comply on a continuing basis with each of its obligations under sections 12 and 14 of this Agreement in advance of, and while, any of its employees, contractors or other agents are present in the Building or on the Property performing any alterations, improvements or other modifications in or other preparation of the Leased Premises.

6. <u>Options</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 If, prior to the date of exercise thereof (a)(i) no Event of Default shall have occurred or (ii) if an Event of Default shall have occurred, the Tenant shall have previously cured it in full or the Landlord shall have waived it and (b) there shall not have been a History of Recurring Events of Default, the Tenant shall have two (2) options, exercisable exclusively at the time and in the manner set forth below in subsection 6.2 of this Agreement, to extend the Term for one additional period of five (5) years' duration per each option. The periods to which these options relate shall respectively commence upon the end of the respective Expiring Term. Each option shall be defined as an "Option to Renew."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 In the event the Tenant is interested in exercising the next available Option to Renew, the Tenant shall give timely notice of the Tenant's interest to the Landlord no earlier than 18, and no later than 17, months prior to the end of the Expiring Term. Within four weeks of the giving of such notice, the Landlord shall give notice to the Tenant of the Landlord's quotation of the Market Rental Rate for the Leased Premises during the Renewal Term. In the event the Tenant desires to exercise the next available Option to Renew, the Tenant shall do so exclusively by giving timely notice thereof to the Landlord no earlier than 16, and no later than 15, months prior to the end of the Expiring Term, and indicating in that notice whether or not the Landlord's quotation of the Market Rental Rate for the Leased Premises during the applicable Renewal Term, as set forth in the Landlord's notice, is acceptable. In the event the Tenant fails timely to notify the Landlord of its interest in exercising the next available Option to Renew or timely to exercise the next available Option to Renew, the Option to Renew shall thereupon expire.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 The Basic Rent for the Leased Premises during the applicable Renewal Term shall be the Landlord's quotation of the Market Rental Rate for the Leased Premises during the applicable Renewal Term, as set forth in the Landlord's notice to the Tenant, unless the Tenant, in the Tenant's notice contemplated by the third sentence of subsection 6.2 of this Agreement affirmatively indicates that the Landlord's quotation of the Market Rental Rate set forth in the Landlord's notice is not acceptable, in which case the Basic Rent for the Leased Premises during the respective Renewal Term shall be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3.1 the Market Rental Rate as determined in accordance with the procedure described in subsection 33.1 of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 The Option to Renew may not be exercised by any person other than the original Tenant, Kardigan Bio, or an assignee or permitted transferee of the Tenant to which the Tenant has assigned or transferred this Agreement in accordance with the terms of subsection 17.6 of this Agreement. In the event the Tenant assigns this Agreement or sublets, or licenses the use or occupancy of, the Leased Premises or any portions thereof other than in accordance with subsection 17**.**6 of this Agreement, or attempts to do so:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.1 any Option to Renew which the Tenant has theretofore properly exercised with respect to a Renewal Term that has not yet actually commenced shall be rescinded, if the Landlord so elects by notice to the Tenant, to the same extent as if it had not been exercised at all; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4.2 any Option to Renew or any other type of option or optional right exercisable by the Tenant not theretofore timely and otherwise properly exercised by the Tenant shall thereupon expire.

7. <u>Use and Occupancy</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 The Tenant shall continuously occupy and use the Leased Premises during the Term exclusively as an executive and administrative office for its business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 In connection with the Tenant's use and occupancy of the Leased Premises and use of the Common Facilities, the Tenant shall observe, and the Tenant shall cause the Tenant's employees, other agents and Guests to observe, each of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.1 the Tenant shall not do, or permit or suffer the doing of, anything which might have the effect of creating not insignificantly increased risk of, or damage from, fire, explosion or other casualty;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.2 the Tenant shall not do, or permit or suffer the doing of, anything which would have the effect of (a) increasing any premium for any liability, property, casualty or excess coverage insurance policy otherwise payable by the Landlord or any tenant of Other Leased Premises unless Tenant agrees to pay such increased premium or (b) making any such types or amounts of insurance coverage unavailable or less available to the Landlord or any tenant of Other Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.3 to the extent they are not inconsistent with this Agreement, the Tenant and the Tenant's employees, other agents and Guests shall comply with the Building Rules and Regulations attached hereto as Exhibit D, and with any changes made therein by the Landlord if, with respect to any such changes, the Landlord shall have given prior written notice of the particular changes to the Tenant and such changes shall not materially adversely affect the conduct of the Tenant's business in the Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.4 the Tenant and the Tenant's employees, other agents and Guests shall not create, permit or continue any Nuisance in or around the Carnegie Center Complex, the Leased Premises, the Other Leased Premises, the Building, the Common Facilities and the Property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.5 the Tenant and the Tenant's employees, other agents and Guests shall not permit the Leased Premises to be regularly occupied by more than one individual per two hundred forty (240) square feet of gross rentable floor space of the Leased Premises;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.6 the Tenant and the Tenant's employees, other agents and Guests shall comply with all Federal, state and local statutes, ordinances, rules, regulations and orders as they pertain to the Tenant's use and occupancy of the Leased Premises, to the conduct of the Tenant's business and to the use of the Common Facilities, except that this subsection shall not require the Tenant to make any structural changes or to install any Building service equipment that may be required thereby that are generally applicable to the Building as a whole (it being agreed that Landlord shall comply with all Federal, state and local statutes, ordinances, rules, regulations and orders pertaining to the Common Facilities and other areas that are not for lease by tenants);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.7 the Tenant and the Tenant's employees, other agents and Guests shall comply with the requirements of the Board of Fire Underwriters (or successor organization) and of any insurance carriers providing liability, property, casualty or excess insurance coverage regarding the Property, the Building, the Common Facilities or any portions thereof, any other improvements on the Property and the Carnegie Center Complex, except that this subsection shall not require the Tenant to make any structural changes or to install Building service equipment that may be required thereby that are generally applicable to the Building as a whole;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.8 the Tenant and the Tenant's employees, other agents and Guests shall not bring or discharge any substance (solid liquid or gaseous), or conduct any activity, in or on the Carnegie Center Complex, the Property, the Building, the Common Facilities or the Leased Premises that shall have been identified by the scientific community or by any Federal, state or local statute (including, without limiting the generality of the foregoing, the Spill Compensation and Control Act (58 N.J.S.A. 23.11 <u>et seq</u>.) and the Industrial Site Recovery Act (13 N.J.S.A. 1 K-6 <u>et seq</u>.), as they may be amended), ordinance, rule, regulation or order as toxic or hazardous to health or to the environment. Except where caused by Tenant, Landlord hereby agrees to defend, indemnify and hold Tenant harmless from and against any and all actual loss, cost, damage, claim or expense (including reasonable legal fees) incurred in connection with or arising out of or relating to the presence of any such substances in or on in or on the Property (or the Building as of the date hereof);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.9 the Tenant and the Tenant's employees, other agents and Guests shall not draw electricity in the Leased Premises in excess of the rated capacity of the electrical conductors and safety devices including, without limiting the generality of the foregoing, circuit breakers and fuses, by which electricity is distributed to and throughout the Leased Premises and, without the prior written consent of the Landlord in each instance, shall not connect any fixtures, appliances or equipment to the electrical distribution system serving the Building and the Leased Premises other than typical professional office equipment such as computers, computer servers, typewriters, copiers, telephone systems, coffee machines and table top microwave ovens, none of which, considered individually and in the aggregate, overall and per fused or circuit breaker protected circuit, shall exceed the above limits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.10 on a timely basis the Tenant shall pay directly and promptly to the respective taxing authorities any taxes (other than Taxes) charged, assessed or levied exclusively on the Leased Premises or arising exclusively from the Tenant's use and occupancy of the Leased Premises; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2.11 the Tenant shall not initiate any appeal or contest of any assessment or collection of Taxes for any period without, in each instance, the prior written consent of the Landlord which, without being deemed unreasonable, the Landlord may withhold if the Building was not ninety (90%) percent occupied by paying tenants throughout that period or if the Tenant is not joined by tenants of Other Leased Premises that leased throughout that period, and that are then leasing, at least eighty (80%) percent of all Other Leased Premises, determined by their gross rentable floor space.

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8. <u>Utilities, Services, Maintenance and Repairs</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 The Landlord shall provide or arrange for the provision of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.1 such maintenance and repair of the Building (except the Leased Premises and Other Leased Premises); the Common Facilities; and the building standard heating, ventilation and air conditioning systems, any plumbing systems and the electrical and life safety systems in the Building, the Common Facilities, the Leased Premises and Other Leased Premises as is customarily provided for first class office buildings in the immediate area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.2 such janitorial services for the Building, the Leased Premises and Other Leased Premises as are set forth in Exhibit F attached hereto and such garbage removal from the Building and the Common Facilities as is customarily provided for first class office buildings in the immediate area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.3 water to the Building (except the Leased Premises and Other Leased Premises, unless the appropriate plumbing, fixtures and hot water heating units have been installed therein);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.4 sewage disposal for the Building;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.5 passenger elevator service for the Building, at all times, except where emergencies require otherwise;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.6 snow and ice clearance from, and sweeping of, Parking Facilities and driveways which are part of the Property or the Common Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.7 the maintenance of landscaping which is part of the Property or the Common Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.8 a perimeter card reader system which permits entry to the Building on a twenty four hour, seven day a week basis; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1.9 a roving security guard for the Carnegie Center Complex on a twenty four hour, seven day a week basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 The Landlord shall provide or arrange for the provision of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.1 such maintenance and repair of the Leased Premises as is customarily provided for leased premises in first class office buildings in the immediate area, except for refinishing walls and wall treatments, base, ceilings, floor treatments and doors in general from time to time or for gouges, spots, marks, damage or defacement caused by anyone other than the Landlord, its employees and other agents, and except for the Tenant's furniture, furnishings, equipment including, without limiting the generality of the foregoing, any supplemental air conditioning equipment installed by or at the request of the Tenant at any time, and other property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.2 such maintenance and repair of the Other Leased Premises as is customarily provided for leased premises in first class office buildings in the immediate area, except for refinishing walls and wall treatments, base, ceilings, floor treatments and doors in general from time to time or for gouges, spots, marks, damage or defacement caused by anyone other than the Landlord, its employees and other agents, and except for the respective tenants' furniture, furnishings, equipment and other property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.3 the electricity required for the operation of the Building, the Property and the Common Facilities during Regular Business Hours and, on a reduced service basis, during other than Regular Business Hours, and, at all times, the electricity required for the Leased Premises and Other Leased Premises;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.4 such building standard heat, ventilation and air conditioning for the Building, the Leased Premises and Other Leased Premises as is customarily provided for first class office buildings in the immediate area for the comfortable use of the Building during Regular Business Hours; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.5 heated water to the Building (except the Leased Premises and Other Leased Premises, unless the appropriate plumbing, fixtures and hot water heating units have been installed therein); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2.6 during other than Regular Business Hours, upon request either (i) using a dial-up procedure provided by the Landlord, or (ii) faxed by the Tenant to the Landlord or submitted to the Landlord using the Landlord's Internet based service request system, in either case, by (a) 3:00 p.m. on the business day in question, or (b) in the case of any weekend day, Legal Holiday or the morning hours of a business day immediately following a weekend or Legal Holiday, the Tenant shall submit its request by 3:00 p.m. on the business day immediately prior to such day(s) in question, the Landlord shall provide heat, ventilation and air conditioning on a full service basis on such day(s) in question at a cost to the Tenant of $100.00 per hour or partial hour of use per floor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 Except as specifically set forth in subsections 8.1 and 8.2.1 of this Agreement, the Tenant shall maintain and repair the Leased Premises and any equipment above building standard installed by, or at the request of, the Tenant and keep the Leased Premises and the foregoing in as good condition and repair, reasonable wear and use excepted, as the Leased Premises are upon the respective completion of any improvements contemplated by sections 5 or 12 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 Notwithstanding anything contained in this Agreement to the contrary, if the Landlord or any Affiliate of the Landlord has elected to qualify as a real estate investment trust ("REIT"), any service required or permitted to be performed by the Landlord pursuant to this Agreement, the charge or cost of which may be treated as impermissible tenant service income under the laws governing a REIT, may be performed by a taxable REIT subsidiary that is affiliated with either the Landlord or the Landlord's property manager, an independent contractor of the Landlord or the Landlord's property manager (the "Service Provider"). If the Tenant is subject to a charge under this Agreement for any such service, then, at the Landlord's direction, the Tenant shall pay such charge either to the Landlord for further payment to the Service Provider or directly to the Service Provider, and, in either case, (i) the Landlord shall credit such payment against Additional Rent due from the Tenant under this Agreement for such service, and (ii) such payment to the Service Provider shall not relieve the Landlord from any obligation under this Agreement concerning the provisions of such service.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.5 Notwithstanding any term, condition or provision of this Agreement to the contrary (including, without limitation, any term, condition or provision of Sections 13.2 and 28.1 of this Agreement), if (a) (1) electricity, (2) water, (3) between May 15th and September 30th of each year during the Term, Building Standard air conditioning during Regular Business Hours, (4) between October 1st and May 14th, heat as needed to the Building or to the Leased Premises, or any material portion of, or (5) if any other utility or service required to be provided or performed by the Landlord pursuant to the terms, conditions and provisions of Section 8 of this Agreement is interrupted, in each case for a period of more than five (5) consecutive Business Days or for more than ten (10) Business Days (in any twenty (20) Business Day period) and (b) if, and to the extent, as a result of such interruption, any portion of the Leased Premises becomes untenantable, Rent shall abate, to the extent and proportion that the Tenant is prevented by such interruption from using the Leased Premises or any such material portion thereof, from the day after the conclusion of such five (5) consecutive Business Day period or such ten (10) Business Day in such

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twenty (20) Business Day period, until such interruption is cured (whether by resolution of the underlying causes of the interruption or by reasonable temporary measures, including, by way of example, the use of generators) that the Tenant may again utilize the Leased Premises or the material portion thereof it was prevented thereby from using as a result of such interruption.

9. <u>Allocation of the Expense of Utilities, Services, Maintenance, Repairs and Taxes</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1 All Tenant Electric Charges shall be borne by the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2 Between the Commencement Date and the end of the No Pass Through Period, the Tenant's Share of all Operational Expenses and Taxes incurred during such period shall be borne by the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3 Between the day after the end of the No Pass Through Period and the end of the Term, the Tenant's Share of Operational Expenses and Taxes incurred during each annual or shorter period ending on (a) December 31 of each year and (b) the end of the Term shall be borne as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.1 the Tenant's Share of: Operational Expenses and Taxes incurred during each such period of twelve (12) months (or shorter period), up to the amounts of Base Year Operational Expenses and Base Year Taxes, respectively (or proportional amount thereof for periods shorter than twelve (12) months), shall be borne by the Landlord; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3.2 the Tenant's Share of: the amounts by which Operational Expenses and Taxes incurred during each such period of twelve (12) months (or shorter period) exceed Base Year Operational Expenses and Base Year Taxes, respectively (or proportional amount thereof for periods shorter than twelve (12) months) shall be allocated to, and borne by, the Tenant as more specifically set forth in section 10 of this Agreement.

10. <u>Computation and Payment of Allocated Expenses of Utilities, Services, Maintenance, Repairs, Taxes and Capital Expenditures</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1 The Tenant shall promptly pay the following additional amounts to the Landlord at the respective times set forth below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.1 commencing with the first day after the end of the No Pass Through Period, and on the first day of each month thereafter during the Term, one-twelfth (1/12) of the Tenant's Share of the amount by which Taxes for the then current calendar year exceeds Base Year Taxes, computed in accordance with subsection 10.5 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.2 within twenty (20) days of the Landlord's giving notice to the Tenant after the close of each calendar year closing during the Term, commencing with the first calendar year closing after the close of the No Pass Through Period, and after the end of the Term, the Tenant's Share of the difference between the Landlord's previously projected amount of Taxes for such period and the actual amount of Taxes for such period, in either case in excess of Base Year Taxes, computed in accordance with subsection 10.6 of this Agreement (unless such difference is a negative amount, in which case the Landlord shall credit such difference against any amounts next due from the Tenant under subsections 10.1.1 and 10.5 of this Agreement or pay such amounts to Tenant within sixty (60) days of determination if the term of this Agreement has expired);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.3 commencing with the first day after the end of the No Pass Through Period, and on the first day of each month thereafter during the Term, one-twelfth (1/12) of the Tenant's Share of the amount by which Operational Expenses for the then current calendar year exceed Base Year Operational Expenses, computed in accordance with subsection 10.7 of this Agreement;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.4 within twenty (20) days of the Landlord's giving notice to the Tenant after the close of each calendar year closing during the Term, commencing with the first calendar year closing after the close of the No Pass Through Period, and after the end of the Term, the Tenant's Share of the difference between the Landlord's previously projected amount of Operational Expenses for such period and the actual amount of Operational Expenses for such period, in either case in excess of Base Year Operational Expenses, computed in accordance with subsection 10.8 of this Agreement (unless such difference is a negative amount, in which case the Landlord shall credit such difference against any amounts next due from the Tenant under subsections 10.1.3 and 10.7 of this Agreement or pay such amounts to Tenant within sixty (60) days of determination if the term of this Agreement has expired);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.5 commencing with the first day of the first month after the Landlord gives any notice contemplated by subsection 10.9 of this Agreement to the Tenant and continuing on the first day of each month thereafter until the earlier of (a) the end of the Term or (b) the last month of the useful life set forth in the respective notice, one-twelfth (1/12) of the Tenant's Share of any Annual Amortized Capital Expenditure, computed in accordance with subsection 10.9 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.6 on the first day of each month during the Term, the monthly Tenant Electric Charges, computed in accordance with subsection 10.10 of this Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1.7 promptly as and when billed therefor by the Landlord, the amount of any expense which would otherwise fall within the definition of Operational Expenses, but which is specifically paid or incurred by the Landlord for operation and maintenance of the Building, the Common Facilities or the Property outside Regular Business Hours at the specific request of the Tenant or the amount of any expenditure incurred for maintenance or repair of damage to the Building, the Common Facilities, the Property, the Leased Premises or the Other Leased Premises caused directly or indirectly, in whole or in part, by the gross negligence or intentional act of the Tenant or any of its employees, other agents or Guests.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2 "Operational Expenses" means all expenses paid or incurred by the Landlord in connection with the Property, the Building, the Common Facilities and any other improvements on the Property and their operation and maintenance (other than Taxes (which are separately allocated to the Tenant in accordance with subsections 10.1.1 and 10.1.2 of this Agreement), Capital Expenditures (which are separately allocated to the Tenant in accordance with subsection 10.1.5 of this Agreement) and those expenses contemplated by subsections 10.6 and 10.8 of this Agreement) including, without limiting the generality of the foregoing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.1 Utilities Expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.2 the expense of providing the services, maintenance and repairs contemplated by subsections 8.1, 8.2.1 and 8.2.2 of this Agreement, whether furnished by the Landlord's employees or by independent contractors or other agents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.3 wages, salaries, fees and other compensation and payments and payroll taxes and contributions to any social security, unemployment insurance, welfare, pension or similar fund and payments for other fringe benefits required by law or union agreement (or, if the employees or any of them are not represented by a union, then payments for benefits comparable to those generally required by union agreement in first class office buildings in the immediate area which are unionized) made to or on behalf of any employees of the Landlord (not above the level of Senior Property Manager) performing services rendered in connection with the operation and maintenance of the Building, the Common Facilities and the

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Property, including, without limiting the generality of the foregoing, elevator operators, elevator starters, window cleaners, porters, janitors, maids, miscellaneous handymen, watchmen, persons engaged in patrolling and protecting the Building, the Common Facilities and the Property, carpenters, engineers, firemen, mechanics, electricians, plumbers, other tradesmen, other persons engaged in the operation and maintenance of the Building, Common Facilities and Property, Building superintendent and assistants, Building manager, and clerical and administrative personnel;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.4 the uniforms of all employees and the cleaning, pressing and repair thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.5 premiums and other charges incurred by the Landlord with respect to all insurance relating to the Building, the Common Facilities and the Property and the operation and maintenance thereof, including, without limitation: property and casualty, fire and extended coverage insurance, including windstorm, flood, hail, explosion, other casualty, riot, rioting attending a strike, civil commotion, aircraft, vehicle and smoke insurance; public liability insurance; elevator, boiler and machinery insurance; excess liability coverage insurance; use and occupancy insurance; workers' compensation and health, accident, disability and group life insurance for all employees; and casualty rent insurance;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.6 sales and excise taxes and the like upon any Operational Expenses and Capital Expenditures;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.7 management fees of any independent managing agent for the Property, the Building or the Common Facilities; and if there shall be no independent managing agent, or if the managing agent shall be a person affiliated with the Landlord, the management fees that would customarily be charged for the management of the Property, the Building and the Common Facilities by an independent, first class managing agent in the immediate area; provided, however, that in any case, (a) such management fees for the first three (3) years of the Initial Term shall equal four percent (4%) per annum and (b) such management fees for the remainder of the Initial Term shall not exceed five percent (5%) per annum;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.8 the cost of replacements for tools, supplies and equipment used in the operation, service, maintenance, improvement, inspection, repair and alteration of the Building, the Common Facilities and the Property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.9 the cost of repainting or otherwise redecorating any part of the Building or the Common Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.10 decorations for the lobbies and other Common Facilities in the Building;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.11 the cost of licenses, permits and similar fees and charges related to operation, repair and maintenance of the Building, the Property and the Common Facilities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.12 an allocable share of service, replacement, repair, maintenance and other charges assessed from time to time by the Carnegie Center Owners Association II to the Building;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.13 all costs of applying and reporting for the Building or any part thereof to seek or maintain certification under the U.S. EPA's Energy Star<sup>®</sup> rating system, the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) rating system or a similar system or standard; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.14 any and all other expenditures of the Landlord in connection with the operation, alteration, repair or maintenance of the Property, the Common Facilities or the Building as a first-class office building and facilities in the immediate area which are properly treated as an expense fully deductible as incurred in accordance with generally applied real estate accounting practice.

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Notwithstanding any term, condition or provision of this Agreement to the contrary, (i) the Landlord agrees to cap increases in Controllable Operational Expenses to five percent (5%) per year on a compounding and cumulative basis and (ii) the cost of providing the Amenities which are located within the Building shall be allocated among all tenants of the Carnegie Center Complex, and not solely among the tenants at the Building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3 "Capital Expenditures" means the following expenditures incurred or paid by the Landlord in connection with the Property, the Building, the Common Facilities and any other improvements on the Property:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.1 all costs and expenses incurred by the Landlord in connection with retro-fitting the entire Building or the Common Facilities, or any portion thereof, to comply with any change in Federal, state or local statute, rule, regulation, order or requirement which change takes effect after the original completion of the Building;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.2 all costs and expenses incurred by the Landlord to replace and improve the Property, the Building or the Common Facilities or portions thereof for the purpose of continued operation of the Property, the Building and the Common Facilities as a first class office complex in the immediate area; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3.3 all costs and expenses incurred by the Landlord in connection with the installation of any energy, labor or other cost saving or life safety device or system on the Property or in the Building or the Common Facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4 Neither "Operational Expenses" nor "Capital Expenditures" shall include any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.1 principal or interest on indebtedness, debt amortization or ground rent paid by the Landlord in connection with any mortgages, deeds of trust or other financing encumbrances, or ground leases of the Building or the Property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.2 any capital expenditure, or amortized portion thereof, other than those included in the definition of Capital Expenditures set forth in subsection 10.3 above;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.3 expenditures for any leasehold improvement which is made in connection with the preparation of any portion of the Building for occupancy by any tenant or which is not made generally to or for the benefit of the Building or the Property;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.4 the cost of repairs or replacements incurred by reason of fire or other casualty, or condemnation (other than costs not in excess of the deductible on any insurance maintained by the Landlord which provides a recovery for such repair or replacement), to the extent the Landlord actually receives proceeds of property and casualty insurance policies or condemnation awards or would have received such proceeds had the Landlord maintained the insurance required to be maintained by the Landlord under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.5 legal fees, space planner's fees, architect's fees, leasing and brokerage commissions, advertising and promotional expenditures and any other marketing expense incurred in connection with the leasing of space in the Building (including new leases, lease amendments, lease terminations and lease renewals);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.6 expenditures for the salaries and benefits of the executive officers, if any, of the Landlord; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4.7 depreciation for the Building, the Common Facilities and any other improvement on the Property.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5 As soon as practicable after the close of the No Pass Through Period and December 31 of each year thereafter, any portion of which is during the Term, the Landlord shall furnish the Tenant with a notice setting forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5.1 Taxes billed, or if a bill has not then been received for the entire period, the Landlord's projection of Taxes to be billed, for the then current calendar year;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5.2 the amount of Base Year Taxes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5.3 the amount, if any, by which item 10.5.1 above exceeds item 10.5.2 above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5.4 the Tenant's Share of item 10.5.3 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6 As soon as practicable after December 31 of each year during the Term and after the end of the Term, the Landlord shall furnish the Tenant with a notice setting forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6.1 the actual amount of Taxes for the preceding calendar year in excess of Base Year Taxes (or proportional amount thereof for shorter periods during the Term);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6.2 the Landlord's previously projected amount of Taxes for the preceding calendar year in excess of Base Year Taxes (or proportional amount thereof for shorter periods during the Term);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6.3 the difference obtained by subtracting item 10.6.2 above from item 10.6.1 above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6.4 the Tenant's Share of item 10.6.3 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7 As soon as practicable after the close of the No Pass Through Period and December 31 of each year thereafter, any portion of which is during the Term, the Landlord shall furnish the Tenant with a notice setting forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7.1 the Landlord's projection of annual Operational Expenses for the current period (if any portion thereof is during the Term);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7.2 the amount of the Base Year Operational Expenses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7.3 the amount, if any, by which item 10.7.1 above exceeds item 10.7.2 above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7.4 the Tenant's Share of item 10.7.3 above.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8 As soon as practicable after December 31 of each year during the Term and after the end of the Term, the Landlord shall furnish the Tenant with a notice setting forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8.1 the actual amount of Operational Expenses for the preceding calendar year in excess of Base Year Operational Expenses (or proportional amount thereof for shorter periods during the Term);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8.2 the Landlord's previously projected amount of Operational Expenses for the preceding calendar year in excess of Base Year Operational Expenses (or proportional amount thereof for shorter periods during the Term);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8.3 the difference obtained by subtracting item 10.8.2 above from item 10.8.1 above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.8.4 the Tenant's Share of item 10.8.3 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9 As soon as practicable after incurring any Capital Expenditure, the Landlord shall furnish the Tenant with a notice setting forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9.1 a description of the Capital Expenditure and the subject thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9.2 the date the subject of the respective Capital Expenditure was first placed into service and the period of useful life selected by the Landlord, in accordance with generally accepted accounting procedures consistently applied, in connection with the determination of the Annual Amortized Capital Expenditure;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9.3 the amount of the Annual Amortized Capital Expenditure; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.9.4 the Tenant's Share of item 10.9.3 above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.10 Tenant Electric Charges shall be initially charged at the rate of $1.75 per rentable square foot per year. From time to time, whenever the Landlord's estimate of Tenant Electric Charges changes, the Landlord shall furnish the Tenant with a notice setting forth its estimate of Tenant Electric Charges per month. Unless the Tenant desires to question the Landlord's then most recent estimate of Tenant Electric Charges exclusively in the manner set forth below, the Landlord's then most recent estimate shall be binding and shall continue in effect until any question raised by the Tenant is otherwise resolved in accordance with this subsection 10.10 of this Agreement. If the Tenant desires to question the Landlord's estimate of Tenant Electric Charges, provided that the Tenant has completed its initial build-out of the Leased Premises, has fully staffed the Leased Premises and is utilizing such quantity of utility service which the Tenant reasonably projects will be the average quantity of utility service which the Tenant will use throughout the Term, the Tenant shall give notice to the Landlord of its desire. Upon receipt of the Tenant's notice, the Landlord shall obtain, at the Tenant's expense, a reputable, independent electrical engineer's formal written estimate and computation of the Tenant Electric Charges. The engineer's estimate and computation of Tenant Electric Charges shall thereupon control for a twelve (12) month period commencing with the date as of which it is given effect as to Tenant Electric Charges, and until the Landlord furnishes the Tenant with a subsequent notice setting forth its estimate of Tenant Electric Charges per month, except to the extent that the Landlord may increase them in proportion to increases in Utilities Expenses during the same period.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11 Subject to the provisions of this subsection 10.11 and provided that no Event of Default exists, the Tenant shall have the right to examine the correctness of the Landlord's statement of the actual amount of Operational Expenses and Taxes and Capital Expenditures as set forth in the notices required by subsections 10.6 and 10.8 or any item contained therein:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.1 Any request for examination with respect to any calendar year during the Term may be made by notice from the Tenant to the Landlord no more than sixty (60) days after the date (the "Operational Expenses and Taxes Statement Date") on which the Landlord provides to the Tenant a statement of the actual amount of the Operational Expenses and Taxes with respect to such calendar year and only if the Tenant shall have fully paid such amount. Such notice shall set forth in reasonable detail the matters questioned. Any such examination must be completed and the results communicated to the Landlord no more than one hundred eighty (180) days after the Operational Expenses and Taxes Statement Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.2 The Tenant hereby acknowledges and agrees that the Tenant's sole right to contest an Operational Expenses and Taxes or Capital Expenditures statement shall be as expressly set forth in this subsection 10.11. The Tenant hereby waives any and all other rights pursuant to applicable law to inspect the Landlord's books and records and/or to contest such Operational Expenses and Taxes or Capital Expenditures statement. If the Tenant shall fail to timely exercise the Tenant's right to inspect the Landlord's books and records as provided in this subsection 10.11 with respect to any calendar year, or if the Tenant shall fail to timely communicate to the Landlord the results of the Tenant's examination as provided in this subsection 10.11 with respect to any calendar year, the Landlord's statement of Operational Expenses and Taxes or Capital Expenditures with respect to such calendar year shall be conclusive and binding on the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.3 So much of the Landlord's books and records pertaining to the Operational Expenses and Taxes or Capital Expenditures for the specific matters questioned by the Tenant for the calendar year included in the Landlord's statement shall be made available to the Tenant either electronically or during normal business hours at the offices where the Landlord keeps such books and records or at another location, as determined by the Landlord, within a reasonable time after the Landlord timely receives the notice from the Tenant to make such examination pursuant to this subsection 10.11.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.4 The Tenant shall have the right to make such examination no more than once with respect to any calendar year for which the Landlord has given the Tenant a statement of the Operational Expenses and Taxes or Capital Expenditures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.5 Such examination may be made only by a qualified employee of the Tenant or a qualified independent certified public accounting firm approved by the Landlord. No examination shall be conducted by an examiner who is to be compensated, in whole or in part, on a contingent fee basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.6 As a condition to performing any such examination, the Tenant and its examiners shall be required to execute and deliver to the Landlord an agreement, in form acceptable to the Landlord in its reasonable discretion, agreeing to keep confidential any information which it discovers about the Landlord, the Property, the Building or the Leased Premises in connection with such examination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.7 No subtenant shall have any right to conduct any such examination and no assignee may conduct any such examination with respect to any period during which the assignee was not in possession of the Leased Premises**.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.11.8 All costs and expenses of any such examination shall be paid by the Tenant, except in the event that such examination shows an overpayment by Tenant of 5% or more in which case Landlord shall pay the costs of Tenant's examination.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.12 The mere enumeration of an item within the definitions of Operational Expenses and Capital Expenditures in subsections 10.2 and 10.3 of this Agreement, respectively, shall not be deemed to create an obligation on the part of the Landlord to provide such item unless the Landlord is affirmatively required to provide such item elsewhere in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.13 In the event that there is located in the Leased Premises a data center containing high density computing equipment, as defined in the U.S. EPA's Energy Star<sup>®</sup> rating system ("Energy Star"), the Landlord may require the installation in accordance with Energy Star of separate metering or check metering equipment, the Tenant being responsible for the costs of any such meter or check meter and the installation and connectivity thereof. The Tenant shall directly pay to the utility all electric consumption on any such meter and shall pay to the Landlord, as Additional Rent, all electric consumption on any such check meter within thirty (30) days after being billed thereof by the Landlord, in addition to other electric charges payable by the Tenant under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.14 In the event that the Tenant purchases any utility service directly from the provider, the Tenant shall promptly provide to the Landlord either permission to access the Tenant's usage information from the utility service provider or copies of the utility bills for the Tenant's usage of such services in a format reasonably acceptable to the Landlord.

11. <u>Leasehold Improvements, Fixtures and Trade Fixtures</u>. All leasehold improvements to the Leased Premises, fixtures installed in the Leased Premises and the blinds and floor treatments or coverings shall be the property of the Landlord, regardless of when, by which party or at which party's cost the item is installed. Movable furniture, furnishings, trade fixtures and equipment of the Tenant which are in the Leased Premises shall be the property of the Tenant, except as may otherwise be set forth in section 23 of this Agreement.

12. <u>Alterations, Improvements and Other Modifications by the Tenant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1 The Tenant shall not make any alterations, improvements or other modifications to the Leased Premises which effect structural changes in the Building or any portion thereof, change the functional utility or rental value of the Leased Premises or, except as may be contemplated by section 5 of this Agreement prior to the Commencement Date, affect the mechanical, electrical, plumbing or other systems installed in the Building or the Leased Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2 The Tenant shall not make any alterations, improvements or modifications to the Leased Premises, the Building or the Property or make any boring in the ceiling, walls or floor of the Leased Premises or the Building unless the Tenant shall have first:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.1 furnished to the Landlord detailed, New Jersey architect-certified construction drawings, construction specifications and, if they pertain in any way to the heating, ventilation and air conditioning or other systems of the Building, related engineering design work and specifications regarding, the proposed alterations, improvements or other modifications and, (i) if the Tenant elects to perform the work through contractors of its own, paid the Landlord a drawings, specifications and design review fee equal to five (5%) percent of the cost of the work and, during the course of the work, a construction inspection fee equal to two (2%) percent of the cost of the work (the Tenant shall furnish to the Landlord, within fifteen (15) days after the substantial completion of such work, a copy of the contractor's Application and Certification for Payment (AIA Document 702) and Continuation Sheet (s) (AIA Document 703) for the total cost of such work and receipted, detailed invoices therefor), and (ii) if the Landlord performs the work, paid the Landlord a drawings, specifications and design review fee equal to five (5%) percent of the cost of the work and, during the course of the work, a construction supervision fee equal to ten (10%) percent of the cost of the work;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.2 not received a notice from the Landlord objecting thereto in any respect within fifteen (15) days of the furnishing thereof (which shall not be deemed the Landlord's affirmative consent for any purpose);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.3 obtained any necessary or appropriate building permits or other approvals from the Municipality and, if such permits or other approvals are conditional, satisfied all conditions to the satisfaction of the Municipality; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4 met, and continued to meet, all the following conditions with regard to any contractors selected by the Tenant and any subcontractors, including materialmen, in turn selected by any of them:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.1 the Tenant shall have sole responsibility for payment of, and shall pay, such contractors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.2 the Tenant shall have sole responsibility for coordinating, and shall coordinate, the work to be supplied or performed by such contractors, both among themselves and with any contractors selected by the Landlord;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.3 the Tenant shall not permit or suffer the filing of any mechanic's notice of intention or other lien or prospective lien by any such contractor or subcontractor with respect to the Property, the Common Facilities, the Building or any other improvements on the Property; and if any of the foregoing should be filed by any such contractor or subcontractor, the Tenant shall forthwith obtain and file the complete discharge and release thereof or provide such payment bond(s) from a reputable, financially sound institutional surety as will, in the opinions of the Landlord, the holders of any mortgage indebtedness on, or other interest in, the Property, the Building, the Common Facilities or any other improvements on the Property, or any portions thereof, and their respective title insurers, be adequate to assure the complete discharge and release thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.4 prior to any such contractor's entering upon the Property, the Building or the Leased Premises or commencing work the Tenant shall have delivered to the Landlord (a) all the Tenant's certificates of insurance set forth in section 14 of this Agreement, conforming in all respects to the requirements of section 14 of this Agreement, except that the effective dates of all such insurance policies shall be prior to any such contractor's entering upon the Property, the Building or the Leased Premises or commencing work (if any work is scheduled to begin before the Commencement Date) and (b) similar certificates of insurance from each of the Tenant's contractors providing for coverage in equivalent amounts, together with their respective certificates of workers' compensation insurance, employer's liability insurance and products-completed operations insurance, the latter providing coverage in at least the amount required for the Tenant's commercial general liability and excess insurance, for the benefit of, and shall name, the Landlord, the Landlord's managing agent and mortgagees and ground lessors known to the Tenant, if any, of the Building, the Common Facilities, the Property or any interest therein, their successors and assigns as additional persons insured, and (c) certificates of insurance from each of the Tenant's contractors providing for builders' risk insurance coverage from financially sound and reputable insurers, licensed by the State of New Jersey to provide such insurance and acceptable to the Landlord, that is written on an "all risk" of physical loss or damage basis, for the full replacement cost value, which insurance policy shall be maintained in full force and effect until final completion of the respective work, and none of which insurance policies shall contain a "co-insurance" clause;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.5 each such contractor shall be a party to collective bargaining agreements with those unions that are certified as the collective bargaining agents of all bargaining units of such contractor, of which all such contractor's workpersons shall be members in good standing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.6 each such contractor shall perform its work in a good and workpersonlike manner and shall not interfere with or hinder the Landlord or any other contractor in any manner;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.7 there shall be no labor dispute of any nature whatsoever involving any such contractor or any workpersons of such contractor or the unions of which they are members with anyone; and if such a labor dispute exists or comes into existence the Tenant shall forthwith, at the Tenant's sole cost and expense, remove all such contractors and their workpersons from the Building, the Common Facilities and the Property; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2.4.8 the Tenant shall have the sole responsibility for the security of the Leased Premises and all contractors' materials, equipment and work, regardless of whether their work is in progress or completed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.3 After the Commencement Date, the Tenant shall not apply any wall covering or other treatment to the walls of the Leased Premises without the prior written consent of the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.4 Notwithstanding the foregoing above in this Section 12, Landlord's consent shall not be required for any interior, non-structural improvements or alterations to the Leased Premises having an aggregate cost not to exceed $50,000 during any Lease Year, which do not (i) affect, alter, interfere with or disrupt any of the electrical, mechanical, plumbing or other system of the Building, (ii) affect the outside appearance of the Building, (iii) affect the roof of the Building, (iv) affect any structural element of the Building, (v) and do not require a construction permit from West Windsor Township.

13. <u>Landlord</u><u>'</u><u>s Rights of Entry and Access</u>. The Landlord and its authorized agents shall have the following rights of entry and access to the Leased Premises:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1 In case of any emergency or threatened emergency, at any time for any purpose which the Landlord reasonably believes under such circumstances will serve to prevent, eliminate or reduce the emergency, or the threat thereof, or damage or threatened damage to persons and property.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2 Upon at least one day's prior verbal advice to the Tenant, at any time for the purpose of erecting or constructing improvements, modifications, alterations and other changes to the Building or any portion thereof, including, without limiting the generality of the foregoing, the Leased Premises, the Common Facilities or the Property or for the purpose of repairing, maintaining or cleaning them, whether for the benefit of the Landlord, the Building, all tenants of Other Leased Premises in the Building, or one or more tenants of Other Leased Premises, the Carnegie Center Complex or others. In connection with any such improvements, modifications, alterations, other changes, repairs, maintenance or cleaning, the Landlord may close off such portions of the Property, the Building and the Common Facilities and interrupt such services as may be necessary to accomplish such work, without liability to the Tenant therefor and without such closing or interruption being deemed an eviction or constructive eviction or requiring an abatement of Rent. However, in accomplishing any such work, the Landlord shall use commercially reasonable efforts not materially interfere with the Tenant's use and enjoyment of the Leased Premises or the conduct of the Tenant's business and to minimize interference, inconvenience and annoyance to the Tenant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.3 At all reasonable hours for the purpose of operating, inspecting or examining the Building, including the Leased Premises, or the Property.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.4 At any time after the Tenant has vacated the Leased Premises, for the purpose of preparing the Leased Premises for another tenant or prospective tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.5 If practicable by appointment with the Tenant, at all reasonable hours for the purpose of showing the Building to prospective purchasers, mortgagees and prospective mortgagees and prospective ground lessees and lessors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.6 If practicable by appointment with the Tenant, at all reasonable hours during the last fifteen (15) months of the Term for the purpose of showing the Leased Premises to prospective tenants thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.7 The mere enumeration of any right of the Landlord within this section 13 of the Agreement shall not be deemed to create an obligation on the part of the Landlord to exercise any such right unless the Landlord is affirmatively required to exercise such right elsewhere in this Agreement.

14. <u>Liabilities and Insurance Obligations</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1 The Tenant shall maintain in full force on or before the earlier of (i) the date on which any Tenant Party first enters the Leased Premises for any reason, or (ii) the Commencement Date, and thereafter throughout and until the end of the Term, and after the end of the Term for so long after the end of the Term as any of the Tenant's Property remains in the Leased Premises, or the Tenant or anyone acting by, through or under the Tenant may use, be in occupancy of any part of, or have access to the Leased Premises or any portion thereof, a policy of commercial general liability insurance, on an occurrence basis, issued on a Commercial General Liability Coverage "occurrence" form. Such insurance shall include contractual liability coverage, covering but not limited to the indemnification obligations undertaken by the Tenant in this Agreement pursuant to policy terms, conditions and exclusions. The minimum limits of liability of such insurance shall be $4,000,000 per occurrence. In addition, in the event the Tenant hosts a function in the Leased Premises, the Tenant agrees to obtain, or cause any persons or parties providing services for such function to obtain, the appropriate insurance coverages as determined by the Landlord (including liquor liability coverage, if applicable) and provide the Landlord with a certificate of service evidencing of the same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2 The Tenant shall maintain at all times during the Term, and during such earlier or later time as the Tenant may be performing work in or to the Leased Premises or have property, fixtures, furniture, equipment, machinery, goods, supplies, wares or merchandise in the Leased Premises, and continuing thereafter so long as any of the Tenant's Property, remains in the Leased Premises, or the Tenant or anyone acting by, through or under the Tenant may use, be in occupancy of or have access to, any part of the Leased Premises, business interruption insurance and insurance against loss or damage covered by the so-called "all risk" or equivalent type insurance coverage with respect to (i) the Tenant's property, fixtures, furniture, equipment, machinery, goods, supplies, wares and merchandise, and other property of the Tenant located at the Leased Premises, (ii) all additions, alterations and improvements made by or on behalf of the Tenant in the Leased Premises or are existing in the Leased Premises as of the date of this Agreement ("Leasehold Improvements"), and (iii) property of third parties, including, but not limited to, leased or rented property, in the Leased Premises in the Tenant's care, custody, use or control, provided that such insurance in the case of (iii) may be maintained by such third parties (collectively the "Tenant's Property"). The business interruption insurance required by this section shall be in an amount of Basic Rent then in effect during the Lease Year, plus any Additional Rent due and payable for the immediately preceding Lease Year. The "all risk" insurance required by this section shall be in an amount at least equal to the full replacement cost of

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the Tenant's Property. In addition, during such time as the Tenant is performing work in or to the Leased Premises, the Tenant, at the Tenant's sole cost and expense, shall also maintain, or shall cause its contractor(s) to maintain, builder's risk insurance for the full insurable value of such work. The Landlord and such additional persons or entities as the Landlord may reasonably request shall be named as loss payees, as their interests may appear, on the policy or policies required by this section for Leasehold Improvements. In the event of loss or damage covered by the "all risk" insurance required by this section, the responsibilities for repairing or restoring the loss or damage shall be determined in accordance with section 15 of this Agreement. To the extent that the Landlord is obligated to pay for the repair or restoration of the loss or damage covered by the policy, the Landlord shall be paid the proceeds of the "all risk" insurance covering the loss or damage. To the extent the Tenant is obligated to pay for the repair or restoration of the loss or damage, covered by the policy, the Tenant shall be paid the proceeds of the "all risk" insurance covering the loss or damage. If both the Landlord and the Tenant are obligated to pay for the repair or restoration of the loss or damage covered by the policy, the insurance proceeds shall be paid to each of them in the pro rata proportion of their obligations to repair or restore the loss or damage. If the loss or damage is not repaired or restored (for example, if this Agreement is terminated pursuant to section 15 of this Agreement), the insurance proceeds shall be paid to the Landlord and the Tenant in the pro rata proportion of their relative contributions to the cost of the leasehold improvements covered by the policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3 The Tenant agrees to maintain in full force on or before the earlier of (i) the date on which any Tenant Party first enters the Leased Premises for any reason, or (ii) the Commencement Date, and thereafter throughout the end of the Term, and after the end of the Term for so long after the end of the Term that any of the Tenant's Property remains in the Leased Premises or as the Tenant or anyone acting by, through or under the Tenant may use, be in occupancy of, or have access to the Leased Premises or any portion thereof, (a) automobile liability insurance (covering any automobiles owned (if any), non-owned, or hired operated by the Tenant at the Carnegie Center Complex); (b) worker's compensation insurance as required by law; and (c) employer's liability insurance. Such automobile liability insurance shall be in an amount not less than One Million Dollars ($1,000,000) for each accident. Such employer's liability insurance shall be in an amount not less than One Million Dollars ($1,000,000) for each accident, One Million Dollars ($1,000,000) disease-policy limit, and One Million Dollars ($1,000,000) disease-each employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4 All insurance required to be maintained by the Tenant pursuant to this Agreement shall be maintained with responsible companies that are authorized to do business, and are in good standing, in the State of New Jersey and that have a rating of at least "A" and are within a financial size category of not less than "Class VII" in the most current Best's Key Rating Guide or such similar rating as may be reasonably selected by the Landlord. All such insurance shall: (1) be acceptable in form and content to the Landlord; and (2) Tenant shall immediately notify Landlord upon receiving any notice of any cancellation or failure to renew with respect to any such insurance. All commercial general liability, excess/umbrella liability and automobile liability insurance policies shall be primary and noncontributory. No liability insurance policy shall contain any self-insured retention greater than $25,000 and no property insurance policy shall contain any self-insured retention greater than $100,000. Any deductibles and such self-insured retentions shall be deemed to be "insurance" for purposes of the waiver in subsection 14.12 below. The Landlord reserves the right from time to time to require the Tenant to obtain higher minimum amounts of insurance based on such limits as are customarily carried with respect to similar properties in the area in which the Leased Premises are located. The minimum amounts of insurance required by this Agreement shall not be reduced by the payment of claims or for any other reason. In the event the Tenant shall fail to obtain or maintain any insurance meeting the requirements of this section 14, or to deliver such policies or certificates as required by this section 14, the Landlord may, at its option, on five (5) days notice to the Tenant, procure such policies for the account of the Tenant, and the cost thereof shall be paid to the Landlord within five (5) days after delivery to the Tenant of invoices therefor.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5 To the fullest extent permitted by law, the commercial general liability and auto insurance carried by the Tenant pursuant to this Agreement, and any additional liability insurance carried by the Tenant pursuant to subsection 14.1 of this Agreement, shall include the Landlord, the Landlord's managing agent, and such other persons as listed on Exhibit G-1 or as otherwise reasonably requested by Landlord from time to time as additional insureds (collectively "Additional Insureds") with respect to liability arising out of or related to this Agreement or the operations of the Tenant. Such insurance shall be primary coverage without contribution from any other insurance carried by or for the benefit of the Landlord, the Landlord's managing agent, or other Additional Insureds. Such insurance shall also waive any right of subrogation against each Additional Insured. For the avoidance of doubt, each primary policy and each excess/umbrella policy through which the Tenant satisfies its obligations under this section 14 must provide coverage to the Additional Insureds that is primary and non-contributory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6 On or before the earlier of (i) the date on which any Tenant Party first enters the Leased Premises for any reason or (ii) the Commencement Date, the Tenant shall furnish the Landlord or through Landlord's preferred vendor for tracking and storing insurance certificates, with certificates evidencing the insurance coverage required by this Agreement, and renewal certificates shall be furnished to the Landlord annually thereafter, and within thirty (30) days of the expiration date of each policy for which a certificate was furnished. Acceptable forms of such certificates for liability and property insurance, respectively, as of the date hereof, are attached hereto as Exhibit G-2 and Exhibit G-3 - Tenant may use current versions of these Acord forms. Failure by the Tenant to provide the certificates required by this subsection 14.6 shall not be deemed to be a waiver of the requirements in this subsection 14.6. Landlord reserves the right to use a third-party to manage Tenant's insurance requirements hereunder. Tenant hereby advises Landlord that Tenant's contact for insurance matters is [\*\*\*]. In the event Landlord chooses to do so, Landlord's service provide will contact Tenant to provider further information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7 The Tenant shall require its subtenants and other occupants of the Leased Premises to provide written documentation evidencing the obligation of such subtenant or other occupant to indemnify the Landlord Parties to the same extent that the Tenant is required to indemnify the Landlord Parties pursuant to section 27 of this Agreement, and to maintain insurance that meets the requirements of this section 14, and otherwise to comply with the requirements of this section 14, provided that the terms of this subsection 14.7 shall not relieve the Tenant of any of its obligations to comply with the requirements of this section 14. The Tenant shall require all such subtenants and occupants to supply certificates of insurance evidencing that the insurance requirements of this section 14 have been met and shall forward such certificates to the Landlord on or before the earlier of (i) the date on which the subtenant or other occupant first enters the Leased Premises or (ii) the commencement date of the sublease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8 The Tenant shall not commit or permit any violation of the policies of fire, boiler, sprinkler, water damage or other insurance covering the Building and/or the fixtures, equipment and property therein carried by the Landlord, or do or permit anything to be done, or keep or permit anything to be kept, in the Leased Premises, which in case of any of the foregoing (i) would result in termination of any such policies, (ii) would adversely affect the Landlord's right of recovery under any of such policies, or (iii) would result in reputable and independent insurance companies refusing to insure the Building or the property of the Landlord in amounts reasonably satisfactory to the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.9 If, because of anything done, caused or permitted to be done, or omitted by the Tenant (or its subtenant or other occupants of the Leased Premises), the rates for liability, fire, boiler, sprinkler, water damage or other insurance on the Building or the Property or on the property and equipment of the Landlord or any other tenant or subtenant in the Building shall be higher than they otherwise would be, the Tenant shall reimburse the Landlord and/or the other tenants and subtenants in the Building for the additional insurance premiums thereafter paid by the Landlord or by any of the other tenants and subtenants in the Building which shall have been charged because of the aforesaid reasons, such reimbursement to be made from time to time on the Landlord's demand.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.10 Any or all of the Landlord's insurance may be provided by blanket coverage maintained by the Landlord or any Affiliate of the Landlord under its insurance program for its portfolio of properties, or by the Landlord or any Affiliate of the Landlord under a program of self insurance, and in such event Operational Expenses shall include the portion of the reasonable cost of blanket insurance or self insurance that is allocated to the Building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.11 The Landlord shall not be obligated to insure and shall not assume any liability of risk of loss for the Tenant's Property, including any such property or work of the Tenant's subtenants or occupants. The Landlord shall also have no obligation to carry insurance against, nor be responsible for, any loss suffered by the Tenant, subtenants or other occupants due to interruption of the Tenant's or any subtenant's or occupant's business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.12 To the fullest extent permitted by law, and notwithstanding any term or provision of this Agreement to the contrary, the parties hereto waive and release any and all rights of recovery against the other, and agree not to seek to recover from the other or to make any claim against the other, and in the case of the Landlord, against all Tenant Parties, and in the case of the Tenant, against all Landlord Parties, for any loss or damage incurred by the waiving/releasing party to the extent such loss or damage is insured under any insurance policy required by this Agreement or which would have been so insured had the party carried the insurance it was required to carry hereunder. The Tenant shall obtain from its subtenants and other occupants of the Leased Premises a similar waiver and release of claims against any or all of the Tenant or the Landlord. In addition, the parties hereto (and in the case of the Tenant, its subtenants and other occupants of the Leased Premises) shall procure an appropriate clause in, or endorsement on, any insurance policy required by this Agreement pursuant to which the insurance company waives subrogation. The insurance policies required by this Agreement shall contain no provision that would invalidate or restrict the parties' waiver and release of the rights of recovery in this section. The parties hereto covenant that no insurer shall hold any right of subrogation against the parties hereto by virtue of such insurance policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.13 During such times as the Tenant is performing work or having work or services performed in or to the Leased Premises, the Tenant shall require its contractors, and their subcontractors of all tiers, to obtain and maintain commercial general liability, automobile, workers compensation, employer's liability, builder's risk, and equipment/property insurance (if applicable) in such amounts and on such terms as are commercially reasonable and customarily required of such contractors and subcontractors performing similar work on similar projects. The amounts and terms of all such insurance are subject to the Landlord's written approval, which approval shall not be unreasonably withheld. The commercial general liability and auto insurance carried by the Tenant's contractors and their subcontractors of all tiers pursuant to this section shall include the Additional Insureds as additional insureds with respect to liability arising out of or related to their work or services. Such insurance shall provide primary coverage without contribution from any other insurance carried by or for the benefit of the Landlord, the Landlord's managing agent, or other Additional Insureds. Such insurance shall also waive any right of subrogation against each Additional Insured. The Tenant shall obtain and submit to the Landlord, prior to the earlier of (i) the entry onto the Leased Premises by such contractors or subcontractors or (ii) commencement of the work or services, certificates of insurance evidencing compliance with the requirements of this section.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.14 <u>Landlord's Insurance</u>.

(a) Required insurance. Landlord shall maintain insurance against loss or damage with respect to the Building on an "all risk" or equivalent type insurance form, with customary exceptions, subject to such commercially reasonable deductibles and self insured retentions as Landlord may determine, in an amount equal to at least the replacement value of the Building as well as commercially reasonable commercial general liability insurance. Landlord shall also maintain such insurance with respect to any improvements, alterations, and fixtures of Tenant located at the Leased Premises to the extent paid for by Landlord. The cost of such insurance shall be treated as a part of Operating Expenses for the Building. Payment for losses thereunder shall be made solely to Landlord.

(b) Optional insurance. Landlord may maintain such additional commercially reasonable insurance with respect to the Building and the Prudential Center, including, without limitation, earthquake insurance, terrorism insurance, flood insurance, liability insurance and/or rent insurance, as Landlord may in its sole discretion elect. Landlord may also maintain such other insurance as may from time to time be required by the holder of any mortgage on the Building or the Prudential Center. The cost of all such additional insurance shall also be part of the Operating Expenses for the Building.

(c) Blanket and self-insurance. Any or all of Landlord's insurance may be provided by blanket coverage maintained by Landlord or any affiliate of Landlord under its insurance program for its portfolio of properties, or by Landlord or any affiliate of Landlord under a program of self-insurance, and in such event Operating Expenses for the Building shall include the portion of the reasonable cost of blanket insurance or self-insurance that is allocated to the Building.

(d) No obligation. Landlord shall not be obligated to insure, and shall not assume any liability of risk of loss for, Tenant's Property, including any such property or work of Tenant's subtenants or occupants, except to the extent caused solely by Landlord's negligence or willful misconduct. Landlord will also have no obligation to carry insurance against, nor be responsible for, any loss suffered by Tenant, subtenants or other occupants due to interruption of Tenant's or any subtenant's or occupant's business.

15. <u>Casualty Damage to Building or Leased Premises</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1 In the event of any damage to the Building or any portion thereof by fire or other casualty, with the result that the Leased Premises are rendered unusable, in whole or in part, or not reasonably accessible to and from the Building's Common Facilities, within thirty (30) business days of the occurrence of the casualty the Landlord shall determine and give notice of its determination to the Tenant whether, due to the extent of damage and the Landlord's analysis of the economic feasibility of rebuilding or restoring, the Landlord intends not to rebuild or restore the Building or, if the Landlord shall not have made that determination, the Landlord's reasonable opinion of the period of time required to restore the Building and the Leased Premises to their condition immediately prior to the occurrence of the respective casualty (exclusive of any improvements constructed, installed or added in the Leased Premises as contemplated by sections 5 or 12 of this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1.1 If the Landlord gives timely notice of its determination that it does not intend to rebuild or restore, due to the extent of damage and the Landlord's analysis of the economic feasibility of rebuilding or restoring, then this Agreement and the Term shall terminate effective as of the date of the subject casualty with respect to those portions of the Leased Premises rendered unusable by the subject casualty and as of the date of the Tenant's surrender with respect to those portions of the Leased Premises which were not rendered unusable by the subject casualty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1.2 Otherwise, if, in the Landlord's reasonable opinion, the restoration contemplated by subsection 15.1 of this Agreement will take more than two hundred forty (240) days (inclusive of a reasonable period for adjustment of the Landlord's insurance claim), then either the Landlord or the Tenant may elect to terminate the Term and this Agreement (effective as of the date of the subject casualty with respect to those portions of the Leased Premises rendered unusable by the subject casualty and as of the

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date of the Tenant's giving notice with respect to those portions of the Leased Premises which were not rendered unusable by the subject casualty) by timely notice of its election to the other. Notice of the Landlord's election to terminate, if any, shall be given to the Tenant within the thirty (30) business day period contemplated by subsection 15.1 of this Agreement. If the Landlord shall not timely elect to terminate the Term and this Agreement, notice of the Tenant's election to terminate, if any, shall be given to the Landlord within the thirty (30) day period immediately succeeding the Landlord's giving notice to the Tenant of the Landlord's estimated period to rebuild or restore.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.1.3 If (a) in the Landlord's reasonable opinion, the restoration contemplated by subsection 15.1 of this Agreement will take more than two hundred forty (240) days (inclusive of a reasonable period for adjustment of the Landlord's insurance claim) and neither the Landlord nor the Tenant shall have timely exercised their respective rights to terminate contemplated by subsection 15.1.2 of this Agreement or (b) in the Landlord's reasonable opinion, the restoration contemplated by subsection 15.1 of this Agreement will take two hundred forty (240) days or less (inclusive of a reasonable period for adjustment of the Landlord's insurance claim), then this Agreement shall remain in effect and the Landlord shall restore the Building and the Leased Premises as contemplated by subsection 15.1 of this Agreement to the extent the Landlord shall have received (and no mortgagee of the Property or the Building shall have received) proceeds of any property, casualty or liability insurance on the damaged portions, causing the restoration to proceed diligently and expediently. Under the circumstances contemplated by clause (b) of this subsection 15.1.3, if the Landlord shall not have timely restored the Building and the Leased Premises as contemplated by subsection 15.1 of this Agreement to the extent the Landlord shall have received proceeds of any property or liability insurance on the damaged portions, the Term shall terminate upon the expiration of ninety (90) additional days (without the Landlord's completion of its restoration obligation in the interim) after the Tenant shall have given prompt notice that the Landlord has not completed its restoration obligations on a timely basis and that the Tenant desires termination of the Term (which termination shall be effective as of the date of the subject casualty with respect to those portions of the Leased Premises rendered unusable by the subject casualty and as of the date of the Tenant's giving notice with respect to those portions of the Leased Premises which were not rendered unusable by the subject casualty).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.2 Under the circumstances contemplated by subsection 15.1 of this Agreement, Rent shall abate from the date of the casualty until such time as the Building and the Leased Premises are again restored by the Landlord as contemplated by subsection 15.1 of this Agreement by the amount which bears the same proportion to the Rent otherwise payable during such period as the gross rentable floor space of the Leased Premises which are rendered unusable or not reasonably accessible to and from the Common Facilities of the Building bears to the gross rentable floor space of the Leased Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.3 The restoration of the improvements constructed or installed in the Leased Premises as contemplated by sections 5 or 12 of this Agreement shall be the Tenant's responsibility. The Tenant shall make reasonable, good faith efforts to integrate the restoration which is its responsibility with the restoration which is the Landlord's responsibility. To the extent such integration is not feasible, the Tenant shall be allowed an additional, reasonable interval to complete its work, not to exceed thirty (30) days after the completion of the Landlord's restoration work, and Rent shall continue to abate until the earlier of (i) the expiration of such additional interval or (ii) the completion of the Tenant's work, to the same extent contemplated by subsection 15.2. The Landlord shall cooperate with the Tenant to integrate the restoration of such improvements during the reconstruction period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.4 In the event the Landlord shall make any election to cancel contemplated by subsection 15.1.1 of this Agreement or either the Landlord or the Tenant shall make any election to cancel contemplated by subsection 15.1.2 of this Agreement, then the Landlord may proceed with restoration (or non-restoration) in any manner it chooses, without any liability to the Tenant.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.5 The Tenant shall promptly advise the Landlord by the quickest means of communication of the occurrence of any casualty damage to the Building or the Leased Premises of which the Tenant becomes aware.

16. <u>Condemnation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1 This section 16 of the Agreement shall apply if the power of eminent domain (or private purchase by any public or quasi-public body in lieu thereof for any public or quasi-public purpose) shall be exercised with the result that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1.1 all or substantially all the Property or the Leased Premises is taken during the Term for at least the balance of the Term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1.2 less than substantially all the Property, the Building or the Common Facilities (but none of the Leased Premises) is taken during the Term for at least the balance of the Term, but the Landlord reasonably promptly determines in good faith that it is not economically feasible for the Landlord to make any necessary alterations and continue to operate the portions not so taken, as they may be altered, as a first class Building and facility in the vicinity for the balance of the Term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1.3 less than substantially all the Leased Premises is taken during the Term for at least the balance of the Term, but the Tenant reasonably promptly determines in good faith that it cannot continue to use and enjoy the portions not so taken for the conduct of its business in the ordinary course during the balance of the Term; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.1.4 so much of the Property or the Common Facilities is taken during the Term for at least the balance of the Term that the Leased Premises are not reasonably accessible to and from the Common Facilities and reasonable alternate access is not provided by the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.2 Under the circumstances contemplated by subsections 16.1.1 and subsections 16.1.4 of this Agreement, then either the Landlord or the Tenant may elect to terminate the Term by notice to the other given within thirty (30) days after, and effective as of, the later of the date (i) that the condemnor acquires title to the portions taken or (ii) that possession of the portions taken is required to be delivered or surrendered to the condemning authority. Under the circumstances contemplated by subsection 16.1.2 of this Agreement the Landlord, and under the circumstances contemplated by subsection 16.1.3 of this Agreement the Tenant, respectively, may elect to terminate the Term by notice to the other given within thirty (30) days after, and effective as of, the later of the date (i) that the condemnor acquires title to the portions taken or (ii) that possession of the portions taken is required to be delivered or surrendered to the condemning authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.3 Under the circumstances contemplated by subsection 16.1 of this Agreement, if no party with any right to elect to terminate the Term under subsection 16.2 of this Agreement shall have given timely notice to the other of exercise of its election to terminate the Term, this Agreement shall continue in full force and effect, but Rent shall abate, effective as of the later of the date (i) that the condemnor acquires title to the portions taken or (ii) that possession of the portions taken is required to be delivered or surrendered to the condemning authority, by the amount which bears the same proportion to the Rent otherwise payable during any period as the gross rentable floor space, if any, of the Leased Premises which is taken bears to the gross rentable floor space of the Leased Premises.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.4 Under any of the circumstances contemplated by this section 16 of the Agreement, the Tenant hereby waives any claim against the Landlord, the condemning authority for anything of value, tangible or intangible, including, without limiting the generality of the foregoing, the putative value of any leasehold interest or the loss of the use of same, except for any right the Tenant might have to make a claim, independent of, and without reference to or having any effect on, any claim, award or settlement of the Landlord, against the condemning authority regarding the value of the Tenant's installed trade fixtures and other installed equipment which are not removable from the Leased Premises or for ordinary and necessary moving and relocation expenses occasioned by the taking.

17. <u>Assignment or Subletting by Tenant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1 Except as may be specifically set forth in this section 17 of the Agreement, the Tenant shall not, by operation of law or otherwise:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1.1 assign, or purport to assign, this Agreement or any of the Tenant's rights hereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1.2 sublet, or purport to sublet, the Leased Premises or any portion thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1.3 license, or purport to license, the use or occupancy of the Leased Premises or any portion thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1.4 otherwise transfer, or attempt to transfer any interest including, without limiting the generality of the foregoing, a mortgage, pledge or security interest, in this Agreement, the Leased Premises or the right to the use and occupancy of the Leased Premises; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1.5 indirectly accomplish, or permit or suffer the accomplishment of, any of the foregoing by merger or consolidation with another entity, by acquisition or disposition of assets or liabilities outside the ordinary course of the Tenant's business or by acquisition or disposition, by the Tenant's equity owners or subordinated creditors, of any of their respective interests in the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2 The Tenant shall not assign this Agreement or any of the Tenant's rights hereunder or sublet the Leased Premises or any portion thereof without first giving thirty (30) days prior notice to the Landlord of its desire to assign or sublet and requesting the Landlord's consent and without first receiving the Landlord's prior written consent. The Tenant's notice to the Landlord shall include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.1 the full name, address and telephone number of the proposed assignee or sublessee;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.2 a description of the type(s) of business in which the proposed assignee or sublessee is engaged and proposes to engage;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.3 a description of the precise use to which the proposed assignee or sublessee intends to put the Leased Premises or portion thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.4 the proposed assignee's or subtenant's most recent quarterly and annual financial statements prepared in accordance with generally accepted accounting principles and any other evidence of financial position and responsibility that the Tenant or proposed assignee or sublessee may desire to submit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.5 by diagram and measurement of the actual square feet of floor space, the precise portion of the Leased Premises proposed to be subject to the assignment of this Agreement or to be sublet;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.6 a complete, accurate and detailed description of the terms of the proposed assignment or sublease including, without limiting the generality of the foregoing, all consideration paid or given, or proposed to be paid or to be given, by the proposed assignee, sublessee or other person to the Tenant and the respective times of payment or delivery;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.7 a payment to the Landlord of an administrative processing fee in the amount of Five Hundred ($500.00) Dollars; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2.8 any other information reasonably requested by the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.3 By the expiration of the notice period contemplated by subsection 17.2 of this Agreement, the Landlord, in its sole discretion, shall take one of the following actions by notice to the Tenant:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.3.1 grant consent on the terms and conditions set forth in subsection 17.4 of this Agreement and such other reasonable terms and conditions set forth in the Landlord's notice;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.3.2 refuse to grant consent for any of the reasons set forth in subsection 17.5 of this Agreement or for any other reasonable reason set forth in the Landlord's notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.3.3 elect to terminate the Term as of (a) the end of the third full month after the Tenant has given notice of the Tenant's desire to assign or sublet or (b) the proposed effective date of the proposed assignment or sublease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4 The Landlord's consent to the Tenant's proposed assignment or sublease, if granted under subsection 17.3.1 of this Agreement, shall be subject to all the following terms and conditions (and to any other terms and conditions permitted by that subsection):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4.1 any proposed assignee or sublessee shall, by document executed and delivered forthwith to the Landlord, agree to be bound by all the obligations of the Tenant set forth in this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4.2 the Tenant shall remain liable under this Agreement, jointly and severally with any proposed assignee or sublessee, for the timely performance of all obligations of the Tenant set forth in this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4.3 the Tenant shall forthwith deliver to the Landlord manually executed copies of all documents regarding the proposed assignment or sublease and a written, accurate and complete description, manually executed both by the Tenant and the proposed assignee or sublessee, of any other agreement, arrangement or understanding between them regarding the same;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4.4 with respect to any consideration or other thing of value received or to be received by the Tenant in connection with any such assignment or sublease (other than those payable in equal monthly installments each month during the proposed term of any such assignment or sublease), the Tenant shall pay to the Landlord one-half of any such amount and one-half of the fair market value of any other thing of value within ten (10) days of receipt of same; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.4.5 with respect to any amount payable to the Tenant in equal monthly installments each month during the proposed term of any such assignment or sublease in connection with such assignment or sublease, which amount is in excess of the amount which bears the same ratio to the monthly installment of Rent due from the Tenant as the gross rentable floor space of the Leased Premises subject to the assignment or sublease bears to the gross rentable floor space of the entire Leased Premises, the Tenant shall pay one-half of such excess to the Landlord together with the Tenant's monthly installment of Rent after deducting all reasonable costs of brokerage, legal fees, tenant improvements and rent concessions.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5 The Landlord's refusal to grant consent under subsection 17.3.2 of this Agreement shall not be deemed an unreasonable withholding of consent if based upon any of the following reasons (or any other reason permitted by that subsection):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.1 the Landlord desires to take one of the other actions enumerated in subsection 17.3 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.2 there is already two other assignees, sublessees or licensees of all or a portion of the Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.3 the proposed sublease is for a term of less than one year;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.4 the proposed sublease is for a term which would expire after the Term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.5 less than one year remains in the Term as of the proposed effective date of the proposed assignment or sublease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.6 the general reputation, financial position or ability or type of business of, or the anticipated use of the Leased Premises by, the proposed assignee or proposed sublessee is unsatisfactory to the Landlord or is inconsistent with those of tenants of Other Leased Premises or of the Carnegie Center Complex or inconsistent with any commitment made by the Landlord to any such other tenant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.7 Tenant shall have marketed, advertised or otherwise promoted the availability of the Leased Premises or any portion thereof for consideration during any period of twelve (12) months for a rental rate that is less than the amount of the Market Rental Rate divided by the gross rentable floor space of the Leased Premises and multiplied by that portion of the gross rentable floor space of the Leased Premises proposed to be subject to the proposed assignment or sublease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.8 the gross rentable floor space of the portion of the Leased Premises proposed to be sublet is less than one-third of the gross rentable floor space of the Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.9 the proposed assignee or sublessee is a tenant, sublessee or other occupant of Other Leased Premises or other premises in the Carnegie Center Complex; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.5.10 any part of the rent payable under the proposed assignment or sublease shall be based in whole or in part on the income or profits derived from the Leased Premises or if any proposed assignment or sublease shall potentially have any adverse effect on the real estate investment trust qualification requirements applicable to the Landlord and its affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6 Notwithstanding anything to the contrary set forth in section 17 of this Agreement, the Landlord hereby consents to the Tenant's assignment of this Agreement or subletting the Leased Premises or portion thereof specified below if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.1 at or prior to the respective dates of exercise and effectiveness thereof (a)(i) no Event of Default shall have occurred or (ii) if an Event of Default shall have occurred, the Tenant shall have previously cured it in full or the Landlord shall have waived it and (b) there shall not have been a History of Recurring Events of Default; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.2 the Tenant and the proposed assignee or sublessee comply with all the conditions set forth in subsections 17.4.1 through 17.4.3 of this Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.3 at the date of effectiveness of the proposed assignment or sublet there is not already more than two other assignee, sublessee or licensee of the Leased Premises or any portions thereof; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.4 one of the following is applicable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.4.1 the proposed assignee or sublessee is, and continues to be, an Affiliate of the Tenant, provided that the proposed assignee or sublessee shall also have and shall continue to have a net worth at least as great as that of the Tenant on the Commencement Date; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.6.4.2 the proposed assignee or sublessee is a person (a) resulting from the merger or consolidation of the Tenant with or into such person or (b) purchasing substantially all the assets or ownership interests (subject to substantially all the liabilities) of the Tenant and succeeding to the business of the Tenant, provided either the Tenant or the proposed assignee or sublessee shall have a net worth at least as great as that of the Tenant on the Commencement Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.7 No person other than the Tenant or a permitted transferee under Section 17.6 shall have any assignment or sublet rights under this Agreement.

18. <u>Signs, Displays and Advertising</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.1 The Tenant shall have one sign identifying the Landlord's assigned number for the Leased Premises at the principal entrance to the Leased Premises. The Tenant may identify itself in or on each of: the sign at the principal entrance to the Leased Premises, the Building directory and the directory, if any, on the floor of the Building on which the Leased Premises is located. All such signs, and the method and materials used in mounting and dismounting them, shall be in accordance with the Landlord's specifications. All such signs shall be provided and mounted by the Landlord at the Landlord's expense, except that the Tenant shall bear any expense of identifying itself on the sign at the principal entrance to the Leased Premises. Tenant's signage will be substantially equal in magnitude, location and quality as the signage provided for any other comparably sized office tenant in the building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.2 No other sign, advertisement, fixture or display shall be used by the Tenant on the Property or in the Building or the Common Facilities. Any signs other than those specifically permitted under subsection 18.1 of this Agreement shall be removed promptly by the Tenant or by the Landlord at the Tenant's expense.

19. <u>Quiet Enjoyment</u>. The Landlord is the owner of the Building, the Property and those Common Facilities located on the Property. The Landlord has the right and authority to enter into and execute and deliver this Agreement with the Tenant. So long as an Event of Default shall not have occurred, the Tenant shall and may peaceably and quietly have, hold and enjoy the Leased Premises during the Term in accordance with this Agreement.

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20. <u>Relocation</u>. At any time but not more than one time during the Initial Term, on at least forty-five (45) days' prior notice to the Tenant, the Landlord shall have the right to move the Tenant out of the Leased Premises and into premises having at least equal floor space located in the Building or in any other comparable building located in the Carnegie Center Complex for the duration of the Term The substitute premises shall have a comparable layout, functionality, and level of natural light as the Leased Premises. In the event the Landlord exercises this right of relocation, the Landlord shall decorate and improve the new premises similarly to the Leased Premises and remove, relocate and reinstall the Tenant's furniture, trade fixtures, furnishings and equipment, all at the sole cost and expense of the Landlord. When the substitute new premises are ready, the Tenant shall surrender the Leased Premises. Following any such relocation, this Agreement shall continue in full force and effect except for the description of the Leased Premises, the Building and the Property which, upon completion of such relocation, shall be deemed amended to describe the substitute new premises, building and property, respectively, to which the Tenant shall have been relocated in accordance with this section 20 of the Agreement.

21. <u>Surrender</u>. Upon termination of the Term, or at any other time at which the Landlord, by virtue of any provision of this Agreement or otherwise has the right to re-enter and re-take possession of the Leased Premises, the Tenant shall surrender possession of the Leased Premises; remove from the Leased Premises all property owned by the Tenant or anyone else other than the Landlord; remove all cabling, hardware and equipment from the ceiling plenum spaces, and/or concealed in wall cavities, including cabling related to the Tenant's movable wall systems or partition office furniture and IT and telecommunications systems, without damaging existing infrastructure and pathways that may support fire alarm systems, lighting systems, electrical systems, fire protection systems, and/or HVAC systems, that the Landlord may request by notice (electrical receptacles shall remain in place in all full height partition walls); remove from the Leased Premises or any Common Facilities any alterations, improvements or other modifications made to the Leased Premises or in the Common Facilities by or on behalf of the Tenant that the Landlord may request by notice at the time such alterations, improvements or modifications are approved by Landlord; upon such removal restore the Leased Premises to its condition prior to the installation of such alterations, improvements or other modifications and repair any damage occasioned by such removal and restoration; clean the Leased Premises; leave the Leased Premises in as good order and condition as it was upon the completion of any improvements contemplated by section 5 of this Agreement, ordinary wear and use excepted (subject to the right of the Landlord, as stated above, to require the Tenant to remove from the Leased Premises any alterations, improvements or other modifications to the Leased Premises and perform any restoration and repairs); return all copies of all keys and passes to the Leased Premises, the Common Facilities and the Building to the Landlord; and receive the Landlord's written acceptance of the Tenant's surrender.

22. <u>Events of Default</u>. The occurrence of any of the following events shall constitute an Event of Default under this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.1 the Tenant's failure to pay any installment of Basic Rent or any amount of Additional Rent within five (5) days of when it is first due;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.2 the Tenant's failure to perform any of its obligations under this Agreement if such failure has caused, or may cause, loss or damage that cannot promptly be cured by subsequent act of the Tenant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.3 the Tenant's failure to complete performance of any of the Tenant's obligations under this Agreement (other than those contemplated by subsections 22.1 and 22.2 of this Agreement) within 30 days after the Landlord shall have given written notice to the Tenant specifying which of the Tenant's obligations has not been performed and in what respects, unless completion of performance within such period of 30 days is not possible using diligence and expedience, then within a reasonable time of the Landlord's notice so long as the Tenant shall have commenced substantial performance within the first five (5) days of such period of thirty (30) days and shall have continued to provide substantial performance, diligently and expediently, through to completion of performance;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.4 the discovery that any representation made by the Tenant in this Agreement shall have been inaccurate or incomplete in any material respect either on the date it was made or the date as of which it was made;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.5 Except in connection with a permitted transfer under 17.6, the sale, transfer or other disposition of any interest of the Tenant in the Leased Premises by way of execution or other legal process;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6 with the exception of those of the following events to which section 365 of the Bankruptcy Code shall apply in the context of an office lease (in which case subsection 22.7 of this Agreement shall apply):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6.1 the Tenant's becoming a "debtor," as that term is defined in section 101 of the Bankruptcy Code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6.2 any time when either the value of the Tenant's liabilities exceed the value of the Tenant's assets or the Tenant is unable to pay its obligations as and when they respectively become due in the ordinary course of business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6.3 the appointment of a receiver or trustee of the Tenant's Property or affairs; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.6.4 the Tenant's making an assignment for the benefit of, or an arrangement with or among, creditors or filing a petition in insolvency or for reorganization or for the appointment of a receiver;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.7 in the event of the occurrence of any of the events enumerated in subsection 22.6 of this Agreement to which section 365 of the Bankruptcy Code shall apply in the context of an office lease, the earlier of the bankruptcy trustee's rejection or deemed rejection (as those terms are used in section 365 of the Bankruptcy Code) of this Agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.8 the Tenant's abandoning the Leased Premises before expiration of the Term without the prior written consent of the Landlord.

23. <u>Rights and Remedies</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1 Upon the occurrence of an Event of Default the Landlord shall have all the following rights and remedies:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.1 to elect to terminate the Term by giving notice of such election, and the effective date thereof, to the Tenant and to receive Termination Damages;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.2 to elect to re-enter and re-take possession of the Leased Premises, without thereby terminating the Term, by giving notice of such election, and the effective date thereof, to the Tenant and to receive Re-Leasing Damages;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.3 if the Tenant remains in possession of the Leased Premises after the Tenant's obligation to surrender the Leased Premises shall have arisen, to remove the Tenant and the Tenant's and any others' possessions from the Leased Premises by any of the following means without any liability to the Tenant therefor, any such liability to the Tenant therefor which might otherwise arise being hereby

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waived by the Tenant: legal proceedings (summary or otherwise), writ of dispossession and any other means and to receive Holdover Damages and, except in the circumstances contemplated by section 20 of this Agreement, to receive all expenses incurred in removing the Tenant and the Tenant's and any others' possessions from the Leased Premises, and of storing such possessions if the Landlord so elects;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.4 to be awarded specific performance, temporary restraints and preliminary and permanent injunctive relief regarding Events of Default where the Landlord's rights and remedies at law may be inadequate, without the necessity of proving actual damages or the inadequacy of the rights and remedies at law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.5 to receive all expenses incurred in securing, preserving, maintaining and operating the Leased Premises during any period of vacancy, in making repairs to the Leased Premises, in preparing the Leased Premises for re-leasing and in re-leasing the Leased Premises including, without limiting the generality of the foregoing, any brokerage commissions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.6 to receive all legal expenses, including without limiting the generality of the foregoing, attorneys' fees incurred in connection with pursuing any of the Landlord's rights and remedies, including indemnification rights and remedies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.7 if the Landlord, in its sole discretion, elects to perform any obligation of the Tenant under this Agreement (other than the obligation to pay Rent) which the Tenant has not timely performed, to receive all expenses incurred in so doing;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.8 to elect to pursue any legal or equitable right and remedy available to the Landlord under this Agreement or otherwise; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1.9 to elect any combination, or any sequential combination of any of the rights and remedies set forth in subsection 23.1 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2 In the event the Landlord elects the right and remedy set forth in subsection 23.1.1 of this Agreement, Termination Damages shall be equal to the amount which, at the time of actual payment thereof to the Landlord, is the sum of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2.1 all accrued but unpaid Rent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2.2 the present value (calculated using the most recently available (at the time of calculation) published weekly average yield on United States Treasury securities having maturities comparable to the balance of the then remaining Term) of the sum of all payments of Rent remaining due (at the time of calculation) until the date the Term would have expired (had there been no election to terminate it earlier) less the present value (similarly calculated) of all payments of rent to be received through the end of the Term (had there been no election to terminate it earlier) from a lessee, if any, of the Leased Premises at the time of calculation (and it shall be assumed for purposes of such calculations that (i) the amount of future Additional Rent due per year under this Agreement will be equal to the average Additional Rent per month due during the twelve (12) full calendar months immediately preceding the date of any such calculation, increasing annually at a rate of six (6%) percent compounded, (ii) if any calculation is made before the first anniversary of the end of the No Pass Through Period, the average Additional Rent due for any month after the end of the No Pass Through Period will be equal to nine (9%) percent of the sum of the Base Year Operating Expenses, Base Year Taxes, Annual Amortized Capital Expenditures and Tenant Electric Charges (considered on an annual basis), (iii) if any calculation is made before the beginning of the Base Year, the sum of Base Year Taxes and Base Year Operational Expenses shall be assumed to be $5.00 per gross rentable square foot and (iv) if any calculation is made before the end of the Base Year, Base Year Taxes and Base Year Operational Expenses may be extrapolated based on the year to date experience of the Landlord);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2.3 the Landlord's reasonably estimated cost of demolishing any leasehold improvements to the Leased Premises; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.2.4 that amount, which as of the occurrence of the Event of Default, bears the same ratio to the costs, if any, incurred by the Landlord (and not paid by the Tenant) in building out the Leased Premises in accordance with section 5 of this Agreement as the number of months remaining in the Term (immediately before the occurrence of the Event of Default) bears to the number of months in the entire Term (immediately before the occurrence of the Event of Default).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.3 In the event the Landlord elects the right and remedy set forth in subsection 23.1.2 of this Agreement, Re-Leasing Damages shall be equal to the Rent less any rent actually and timely received by the Landlord from any lessee of the Leased Premises or any portion thereof, payable at the respective times that Rent is payable under the Agreement plus the cost, if any, to the Landlord of building out or otherwise preparing the Leased Premises for, and leasing the Leased Premises to, any such lessee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.4 In the event the Landlord elects the right and remedy set forth in subsection 23.1.3 of this Agreement, Holdover Damages shall mean damages at the rate per month or part thereof equal to the greater of: (a) one and one-half times one-twelfth (1/12) of the then Market Rental Rate plus all Additional Rent as set forth in this Agreement or (b) double the average amount of all payments of Rent due under this Agreement during each of the last twelve (12) full calendar months prior to the Landlord's so electing or, in the event the Term shall have terminated by expiration under subsection 24.1.1 of this Agreement, the last full twelve (12) calendar months of the Term, in either case payable in full on the first day of each holdover month or part thereof. The Tenant's obligations under this subsection 23.4 shall survive the expiration or earlier termination of this Agreement.

Notwithstanding any provision of this Lease to the contrary, in no event shall Landlord or Tenant have any liability for any special, indirect or consequential damages or any other damages in the nature of lost profits, except to the extent of Tenant's responsibility for damages under Section 7.2.8 or any Holdover Damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5 In connection with any summary proceeding to dispossess and remove the Tenant from the Leased Premises under subsection 23.1.3 of this Agreement, the Tenant hereby waives:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.1 any notices for delivery of possession thereof, of termination, of demand for removal therefrom, of the cause therefor, to cease, to quit and all other notices that might otherwise be required pursuant to 2A N.J.S.A. 18-53 <u>et seq</u>.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.2 any right the Tenant might otherwise have to cause a termination of the action or proceeding by paying to the Landlord or into court or otherwise any Rent in arrears;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.3 any right the Tenant might otherwise have to a period of waiting between issuance of any warrant in execution of any judgment for possession obtained by the Landlord and the execution thereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.4 any right the Tenant might otherwise have to transfer or remove such proceeding from the court (or the particular division or part of the court) or other forum in which it shall have been instituted by the Landlord to another court, division or part;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.5 any right the Tenant might otherwise have to redeem the Tenant's former leasehold interest between the entry of any judgment and the execution of any warrant issued in connection therewith by paying to the Landlord or into Court or otherwise any Rent in arrears; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.5.6 any right the Tenant might otherwise have to appeal any judgment awarding possession of the Leased Premises to the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.6 The enumeration of rights and remedies in this section 23 of the Agreement is not intended to be exhaustive or exclusive of any rights and remedies which might otherwise be available to the Landlord, or to force an election of one or more rights and remedies to the exclusion of others, concurrently, consecutively or sequentially. On the contrary, each right and remedy enumerated in this section 23 of the Agreement is intended to be cumulative with each other right and remedy enumerated in this section 23 of the Agreement and with each other right and remedy that might otherwise be available to the Landlord; and the selection of one or more of such rights and remedies at any time shall not be deemed to prevent resort to one or more others of such rights and remedies at the same time or a subsequent time, even with regard to the same occurrence sought to be remedied.

24. <u>Termination of the Term</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1 The Term shall terminate upon the earliest of the following events to occur:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1.1 expiration of the Term;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1.2 in connection with a transaction contemplated by section 16 of this Agreement and under the circumstances contemplated by subsection 16.2 of this Agreement, the effective date of termination of the Term as set forth in subsection 16.2;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1.3 upon the respective effective dates of termination set forth in the various subsections (whichever may be applicable) of subsection 15.1 of this Agreement providing for termination of the Term under various circumstances;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1.4 the effective date of any election by the Landlord under subsection 17.3.3 of this Agreement in response to the Tenant's notice of the Tenant's desire to assign this Agreement or to sublet all or a portion of the Leased Premises; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.1.5 the effective date of any election by the Landlord to terminate the Term under subsection 23.1.1 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.2 No termination of the Term shall have the effect of releasing the Tenant from any obligation or liability theretofore or thereby incurred and, until the Tenant shall have surrendered the Leased Premises in accordance with section 21 of this Agreement, from any obligation or liability thereafter incurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.3 Any items of Tenant's Property (except money, securities and like valuables) which remain in the Leased Premises after the expiration or earlier termination of the Term may, at the option of the Landlord, be deemed to have been abandoned and in such case may either be retained by the Landlord as its property or may be disposed of without accountability, at the Tenant's expense, in such manner as the Landlord may see fit.

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26. <u>Transfer by Landlord</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.1 The Landlord shall have the right at any time and from time to time to sell, transfer, lease or otherwise dispose of the Carnegie Center Complex, the Property, the Common Facilities or the Building or any of the Landlord's interests therein, or to assign this Agreement or any of the Landlord's rights thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.2 Upon giving notice of the occurrence of any transaction contemplated by subsection 26.1 of this Agreement, the Landlord shall thereby be relieved of any obligation that might otherwise exist under this Agreement with respect to periods subsequent to the effective date of any such transaction. If, in connection with any transaction contemplated by subsection 26.1 of this Agreement the Landlord transfers, or makes allowance for, any Security Deposit of the Tenant and gives notice of that fact to the Tenant, the Landlord shall thereby be relieved of any further obligation to the Tenant with regard to any such Security Deposit; and the Tenant shall look solely to the transferee with respect to any such Security Deposit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.3 In the event of the occurrence of any transaction contemplated by subsection 26.1 of this Agreement the Tenant, upon written request therefor from the transferee, shall attorn to and become the tenant of such transferee upon the terms and conditions set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.4 Notwithstanding anything to the contrary that may be set forth in subsections 26.1, 26.2 and 26.3 of this Agreement, in the event any mortgage contemplated by section 25 of this Agreement is enforced by the respective mortgagee pursuant to remedies provided in the mortgage or otherwise provided by law or equity and any person succeeds to the interest of the Landlord as a result of, or in connection with, any such enforcement, the Tenant shall, upon the request of such successor in interest, automatically attorn to and become the Tenant of such successor in interest without any change in the terms or provisions of this Agreement, except that such successor in interest shall not be bound by: (a) any payment of Basic Rent or Additional Rent (exclusive of prepayments in the nature of a Security Deposit) for more than one month in advance or (b) any amendment or other modification of this Agreement which was made without the consent of such mortgagee or such successor in interest; and, upon the request of such successor in interest, the Tenant shall execute, acknowledge and deliver any instrument(s) confirming such attornment.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.5 If this Agreement and the estate, interest and rights hereby created for the benefit of the Tenant are ever subject and subordinate to any ground lease contemplated by section 25 of this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.5.1 upon the expiration or earlier termination of the term of any such ground lease before the termination of the Term under this Agreement, the Tenant shall attorn to, and become the Tenant of, the lessor under any such ground lease and recognize such lessor as the Landlord under this Agreement for the balance of the Term; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;26.5.2 such expiration or earlier termination of the term of any such ground lease shall have no effect on the Term under this Agreement.

27. <u>Indemnification</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.1 To the fullest extent permitted by law, the Tenant waives any right to contribution against the Landlord Parties and agrees to indemnify and save harmless the Landlord Parties from and against all claims of whatever nature by a third party arising from or claimed to have arisen from (i) any act, omission or negligence of the Tenant Parties; (ii) any accident, injury or damage whatsoever caused to any person, or to the property of any person, occurring in or about the Leased Premises from the earlier of (a) the date on which any Tenant Party first enters the Leased Premises for any reason or (b) the Commencement Date, and thereafter throughout and until the end of the Term, and after the end of the Term for so long after the end of the Term as any of the Tenant's Property remains in the Leased Premises, or the Tenant or anyone acting by, through or under the Tenant may use, be in occupancy any part of, or have access to the Leased Premises or any portion thereof; (iii) any accident, injury or damage whatsoever occurring outside the Leased Premises but within the Building, within the Common Facilities, on the Property or within the Carnegie Center Complex, where such accident, injury or damage results, or is claimed to have resulted, from any act, omission or negligence on the part of any of the Tenant Parties; or (iv) any breach of this Agreement by the Tenant, except to the extent of any claims caused solely by Landlord's negligence or willful misconduct. The Tenant shall pay such indemnified amounts as they are incurred by the Landlord Parties. This indemnification shall not be construed to deny or reduce any other rights or obligations of indemnity that a Landlord Party may have under this Agreement. The indemnification rights of the Landlord Parties provided in this Agreement are their exclusive indemnification rights with respect to this Agreement. The Landlord Parties waive any additional rights to indemnification they may have against the Tenant Parties with respect to this Agreement under common law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.2 In the event that the Tenant breaches any of its indemnity obligations hereunder: (i) the Tenant shall pay to the Landlord Parties all liabilities, loss, cost, or expense (including reasonable attorney's fees) incurred as a result of said breach; and (ii) the Landlord Parties may deduct and offset from any amounts due to the Tenant under this Agreement any amounts owed by the Tenant pursuant to this section 27.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.3 The indemnification obligations under this section 27 shall not be limited in any way by any limitation on the amount or type of damages, compensation or benefits payable by or for the Tenant or any subtenant or other occupant of the Leased Premises under workers' compensation acts, disability benefit acts, or other employee benefit acts. The Tenant waives any immunity from or limitation on its indemnity or contribution liability to the Landlord Parties based upon such acts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.4 The Tenant shall require its subtenants and other occupants of the Leased Premises to provide similar indemnities to the Landlord Parties in a form reasonably acceptable to the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.5 The terms of this section 27 shall survive any termination or expiration of this Agreement.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.6 The foregoing indemnity and hold harmless agreement shall include indemnity for all costs, expenses and liabilities (including, without limitation, attorneys' fees and disbursements) incurred by the Landlord Parties in connection with any such claim or any action or proceeding brought thereon, and the defense thereof. In addition, in the event that any action or proceeding shall be brought against one or more Landlord Parties by reason of any such claim, the Tenant, upon request from the Landlord Party, shall resist and defend such action or proceeding on behalf of the Landlord Party by counsel appointed by the Tenant's insurer (if such claim is covered by insurance without reservation) or otherwise by counsel reasonably satisfactory to the Landlord Party. The Landlord Parties shall not be bound by any compromise or settlement of any such claim, action or proceeding without the prior written consent of such Landlord Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.7 The Tenant agrees to use and occupy the Leased Premises, and to use such other portions of the Building, the Property and the Carnegie Center Complex as the Tenant is given the right to use by this Agreement, at the Tenant's own risk. Except to the extent caused solely by Landlord's negligence or willful misconduct, the Landlord Parties shall not be liable to the Tenant Parties for any damage, injury, loss, compensation, or claim (including, but not limited to, claims for the interruption of or loss to a Tenant Party's business) based on, arising out of or resulting from any cause whatsoever, including, but not limited to, repairs to any portion of the Leased Premises, the Building, the Property or the Carnegie Center Complex, any fire, robbery, theft, mysterious disappearance, or any other crime or casualty, the actions of any tenants of Other Leased Premises or of any other person or persons, or any leakage in any part or portion of the Leased Premises, the Common Facilities, the Building or the Property, or from water, rain or snow that may leak into, or flow from any part of the Leased Premises, the Common Facilities, the Building or the Property, or from drains, pipes or plumbing fixtures in the Building or on the Property. Any goods, property or personal effects stored or placed in or about the Leased Premises shall be at the sole risk of the Tenant Party, and neither the Landlord Parties nor their insurers shall in any manner be held responsible therefor. The Landlord Parties shall not be responsible or liable to a Tenant Party, or to those claiming by, through or under a Tenant Party, for any loss or damage that may be occasioned by or through the acts or omissions of persons occupying adjoining premises or any part of the premises adjacent to or connecting with the Leased Premises or any part of the Building or otherwise. The provisions of this section shall be applicable to the fullest extent permitted by law, and until the expiration or earlier termination of the Term, and during such further period as any of the Tenant's Property remains in the Leased Premises, or the Tenant or anyone acting by, through or under the Tenant may use, or be in occupancy of any part of, or have access to the Leased Premises or of the Building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;27.8 Subject to the limitations set forth in subsections 14.12, 27.7 and 28.3 of this Agreement, and to the extent not resulting from any intentional act, omission, negligence or willful misconduct of the Tenant or its contractors, licensees, invitees, agents, servants or employees, the Landlord agrees to indemnify and save harmless the Tenant from and against any claim by a third party arising from any injury to any person occurring in the Leased Premises, in the Building, on the Property or in the Carnegie Center Complex after the date that possession of the Leased Premises is first delivered to Tenant and until the expiration or earlier termination of the Term, to the extent such injury results from the negligence or willful misconduct of the Landlord or the Landlord's employees, or from any breach or default by the Landlord in the performance or observance of its covenants or obligations under this Agreement; provided, however, that in no event shall the aforesaid indemnity render the Landlord responsible or liable for any loss or damage to fixtures, personal property or other property of the Tenant, and the Landlord shall in no event be liable for any of Tenant's indirect or consequential damages. The Tenant shall provide notice of any such third party claim to the Landlord as soon as practicable. The Landlord shall have the right, but not the duty, to defend the claim. The provisions of this subsection 27.8 shall not be applicable to (i) the holder of any mortgage now or hereafter on the Property or the Building (whether or not such holder shall be a mortgagee in possession of or shall have exercised any rights under a conditional, collateral or other assignment of leases and/or rents respecting the Property or the Building), or (ii) any person acquiring title as a result of, or subsequent to, a foreclosure of any such mortgage or a deed in lieu of foreclosure, except to the extent of liability insurance maintained by either of the foregoing.

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28. <u>Parties</u><u>'</u> <u>Liability</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.1 None of the following occurrences shall constitute a breach of this Agreement by the Landlord, a termination of the Term, an active or constructive eviction or an occurrence requiring an abatement of Rent:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.1.1 the inability of the Landlord to provide any utility or service to be provided by the Landlord, as described in section 8 of this Agreement which is due to causes beyond the Landlord's control, or to necessary or advisable improvements, maintenance, repairs or emergency, so long as the Landlord uses reasonable efforts and diligence under the circumstances to restore the interrupted service or utility;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.1.2 any improvement, modification, alteration or other change made to the Carnegie Center Complex, the Property, the Building or the Common Facilities by the Landlord consistently with the Landlord's obligations set forth in subsection 13.2 of this Agreement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.1.3 any change in any Federal, state or local law or ordinance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.2 In the event Landlord or Tenant is in any way delayed, impeded, interrupted, stopped or prevented from performing any of its obligations under this Lease (except, with respect to Tenant, its obligations to give notice with respect to any option explicitly set forth in this Lease, to surrender the Premises as and when required by this Lease and to maintain insurance as required by this Lease) due to fire, casualty, act of God, epidemic, pandemic, breach of cyber security, strike, lockout, labor dispute or disruption, disruption in the supply chain or other inability by the exercise of reasonable diligence to obtain materials or parts, act of war, terrorism, breakdown, accident, civil commotion, laws, regulations, restrictions, orders, quarantines, construction moratoria or other action or inaction by any local, state or federal governmental or health authority (including, without limitation, any shelter-in-place orders, stay at home orders, occupancy restrictions or limitations or any restriction on travel related to the forgoing that preclude or restrict Landlord or Tenant or their agents, contractors or employees from accessing or using the Premises), or any other cause or event to the extent beyond such party's reasonable control regardless of whether such cause or event is (i) related to the specifically enumerated causes or events in this paragraph or (ii) foreseeable or unforeseeable (each, an event of "Force Majeure"), such cause or event of Force Majeure shall excuse the performance of the obligation of such party under this Lease for a period equal to such delay, impediment, interruption, stoppage or prevention, including the time necessary to repair any damage caused by the Force Majeure event, if any. Notwithstanding anything to the contrary contained in this Lease and for avoidance of doubt, in no event will (i) any party be entitled to claim Force Majeure due to any act or inaction within its reasonable control, (ii) financial hardship constitute an event of Force Majeure nor (iii) any event of Force Majeure in any way (a) affect, excuse, suspend, reduce or abate the obligation of Tenant to timely pay all rent and other charges payable by Tenant pursuant to the terms of this Lease, except as expressly provided in Section 14 and Section 15.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.3 In the event the Landlord is an individual, partnership, joint venture, association or a participant in a joint tenancy or tenancy in common, the Landlord, the partners, venturers, members and joint owners shall not have any personal liability or obligation under or in connection with this Agreement or the Tenant's use and occupancy of the Leased Premises; but recourse shall be limited exclusively to the Landlord's interest in the Building.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.4 If, at any time during the Term, the payment or collection of any Rent otherwise due under this Agreement shall be limited, frozen or otherwise subjected to a moratorium by applicable law, and such limitation, freeze or other moratorium shall subsequently be lifted, whether before or after the termination of the Term, such aggregate amount of Rent as shall not have been paid or collected during the Term on account of any such limitation, freeze or other moratorium, shall thereupon be due and payable at once. There shall be added to the maximum period of any otherwise applicable statute of limitation the entire period during which any such limitation, freeze or other moratorium shall have been in effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.5 If this Agreement is executed by more than one person as the Tenant, their liability under this Agreement and in connection with the use and occupancy of the Leased Premises shall be joint and several.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.6 In the event any rate of interest, or other charge in the nature of interest, calculated as set forth in this Agreement would lead to the imposition of a rate of interest in excess of the maximum rate permitted by applicable usury law, only the maximum rate permitted shall be charged and collected.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;28.7 The rule of construction that any ambiguities that may be contained in any contract shall be construed against the party drafting the contract shall be inapplicable in construing this Agreement.

29. <u>Security Deposit</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.1 The Tenant shall pay to the Landlord upon execution and delivery of this Agreement the sum of $125,352.50 as a security deposit, in the form of a letter of credit as described in subsection 29.2 of this Agreement, to be held by the Landlord as security for the Tenant's performance of all the Tenant's obligations under this Agreement. The Tenant shall not encumber the Security Deposit. If there is no Event of Default at the end of the Term or upon the earlier termination of the Term, within thirty (30) days after termination of the Term the Landlord shall return the entire balance of the Security Deposit to the Tenant. The Tenant will not look to any foreclosing mortgagee of the Property, the Building, the Common Facilities or any interest therein for such return of the balance of the Security Deposit, unless the mortgagee has expressly assumed the Landlord's obligations under this Agreement or has actually received the balance of the Security Deposit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;29.2 The Security Deposit contemplated by subsection 29.1 of this Agreement shall be in the form of an irrevocable letter of credit in the amount of the Security Deposit for the benefit of the Landlord. The letter of credit shall (i) be issued by and drawn on a reputable commercial bank operating in the United States reasonably satisfactory to the Landlord and at a minimum having a long term issuer credit rating from Standard and Poor's Professional Rating Service of A or a comparable minimum rating from Moody's Professional Rating Service, (ii) permit one or more draws thereunder to be made which are conditioned only on the Landlord's certification of the occurrence of an Event of Default that, at the time of the draw, shall not have been cured in full by the Tenant, (iii) permit transfers at any time without charge, and (iv) provide that any notices to the Landlord be sent to the notice address provided for the Landlord in this Agreement. If the credit rating for the issuer of such letter of credit falls below the standard set forth in (i) above, or if the financial condition of such issuer changes in any other material adverse way, or if the issuer is placed in receivership by the Federal Deposit Insurance Corporation or other governmental entity, the Landlord shall have the right to require that the Tenant provide a substitute letter of credit that complies in all respects with the requirements of this subsection, and the Tenant's failure to provide the same within thirty (30) days following the Landlord's written demand therefor shall entitle the Landlord to immediately draw 100% of the then current letter of credit and hold the proceeds as a cash Security Deposit in accordance with subsection 29.1 of this Agreement. In the case of the issuer being placed in receivership by the Federal Deposit Insurance Corporation or other governmental entity, the failure of the Federal Deposit Insurance Corporation or other governmental entity to honor the presentation of documentation by the Landlord to draw 100% of the then current letter of credit shall be an Event of Default under this Agreement. The letter of credit shall be held by the Landlord as a Security Deposit for the Tenant's performance of all the Tenant's

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obligations under this Agreement. The Landlord, in its sole discretion, may draw upon the Security Deposit to cure any Event of Default under this Agreement. If any such application is made, upon written notice by the Landlord to the Tenant, the Tenant shall promptly replace the amount so applied in the form of an additional letter of credit with otherwise similar terms. The letter of credit shall be for a term lasting for at least ten (10) days after the expiration of the Term, or, if the issuer of the letter of credit regularly and customarily only issues letters of credit for shorter terms, for the longest of such shorter regular and customary terms, but in no event for a term shorter than one year. If the letter of credit is issued for a term shorter than the Term, the letter of credit shall contain an "evergreen clause" which shall provide for automatic renewals, without written amendment, for successive terms each of which is equal to such term, unless the issuer gives to the Landlord at least sixty (60) days' written notice of cancellation or non-renewal of the letter of credit prior to the expiration date of the letter of credit. In the event that the issuer gives such notice, the Tenant shall obtain and deliver to the Landlord a substitute letter of credit that complies in all respects with the requirements of this subsection, no later than thirty (30) days prior to expiration of the term of the then current letter of credit. If the Tenant shall fail to obtain and deliver to the Landlord on a timely basis any such conforming substitute letter of credit, the Landlord shall have the right to draw 100% of the then current letter of credit and hold the proceeds as a cash Security Deposit in accordance with subsection 29.1 of this Agreement. In the event that Landlord draws upon the letter of credit and holds the proceeds as a cash Security Deposit in accordance with Section 29.1, upon Landlord's receipt of a substitute letter of credit satisfying the requirements of this Section 29.2, Landlord shall return the cash Security Deposit to Tenant.

30. <u>Representations</u>. The Tenant hereby represents and warrants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30.1 no broker or other agent has shown the Leased Premises or the Building to the Tenant, or brought either to the Tenant's attention, except JLL, whose entire commission therefor is set forth in a separate document and which commission the Tenant understands will be paid by the Landlord directly to the person named;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30.2 the execution and delivery of, the consummation of the transactions contemplated by and the performance of all its obligations under, this Agreement by the Tenant have been duly and validly authorized by its general partners, to the extent required by their partnership agreement and applicable law, if the Tenant is a partnership or, if the Tenant is a limited liability company, by its representative(s) and members to the extent required by their operating agreement and applicable law or, if the Tenant is a corporation, by its board of directors and, if necessary, by its stockholders at meetings duly called and held on proper notice for that purpose at which there were respective quorums present and voting throughout; and no other approval, partnership, corporate, governmental or otherwise, is required to authorize any of the foregoing or to give effect to the Tenant's execution and delivery of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30.3 the execution and delivery of, the consummation of the transactions contemplated by and the performance of all its obligations under, this Agreement by the Tenant will not result in a breach or violation of, or constitute a default under, the provisions of any statute, charter, certificate of incorporation or bylaws or partnership agreement of the Tenant or any affiliate of the Tenant, as presently in effect, or any indenture, mortgage, lease, deed of trust, other agreement, instrument, franchise, permit, license, decree, order, notice, judgment, rule or order to or of which the Tenant or any affiliate of the Tenant is a party, a subject or a recipient or by which the Tenant, any affiliate of the Tenant or any of their respective properties and other assets is bound; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;30.4 (i) the Tenant is not, nor is it owned or controlled directly or indirectly by, any person, group, entity or nation named on any list issued by the Office of Foreign Assets Control of the United States Department of the Treasury ("OFAC") pursuant to Executive Order 13224 or any similar list or any law, order, rule or regulation or any Executive Order of the President of the United States as a terrorist,

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"Specially Designated National and Blocked Person" or other banned or blocked person (any such person, group, entity or nation being hereinafter referred to as a "Prohibited Person"); (ii) the Tenant is not (nor is it owned or controlled, directly or indirectly, by any person, group, entity or nation which is) acting directly or indirectly for or on behalf of any Prohibited Person; and (iii) neither Tenant (nor any person, group, entity or nation which owns or controls the Tenant, directly or indirectly) has conducted or will conduct business or has engaged or will engage in any transaction or dealing with any Prohibited Person, including without limitation any assignment of this Agreement or any subletting of all or any portion of the Leased Premises or the making or receiving of any contribution of funds, goods or services to or for the benefit of a Prohibited Person. In connection with the foregoing, is expressly understood and agreed that (x) any breach by the Tenant of the foregoing representations and warranties shall be deemed a default by the Tenant under subsection 22.2 of this Agreement and shall be covered by the indemnity provisions of section 27 of this Agreement, and (y) the representations and warranties contained in this subsection 30.4 shall be continuing in nature and shall survive the expiration or earlier termination of this Agreement.

31. <u>Reservation in Favor of Tenant</u>. Neither the Landlord's forwarding a copy of this document to any prospective tenant nor any other act on the part of the Landlord prior to execution and delivery of this Agreement by the Landlord shall give rise to any implication that any prospective tenant has a reservation, an option to lease or an outstanding offer to lease any premises.

32. <u>Tenant</u><u>'</u><u>s Certificates and Mortgagee Notice Requirements</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1 Promptly upon request of the Landlord at any time or from time to time, but in no event more than ten (10) days after the Landlord's respective request, the Tenant shall execute, acknowledge and deliver to the Landlord or its designee an estoppel or other certificate, satisfactory in form and substance to the Landlord and any of its mortgagees, ground lessors or lessees or transferees or prospective mortgagees, ground lessors or lessees or transferees, with respect to any of or all the following matters:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.1 whether this Agreement is then in full force and effect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.2 whether this Agreement has not been amended, modified, superseded, canceled, repudiated or revoked;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.3 whether the Landlord has satisfactorily completed all construction work, if any, required of the Landlord or contractors selected and retained by the Landlord in connection with readying the Leased Premises for occupancy by the Tenant in accordance with section 5 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.4 whether the Tenant is then in actual possession of the Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.5 whether the Tenant then has no defenses or counterclaims under this Agreement or otherwise against the Landlord or with respect to the Leased Premises;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.6 whether the Landlord is not then in breach of this Agreement in any respect;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.7 whether the Tenant then has no knowledge of any assignment of this Agreement, the pledging or granting of any security interest in this Agreement or in Rent due and to become due under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.8 whether Rent is not then accruing under this Agreement in accordance with its terms;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.9 whether any Rent is not then in arrears;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.10 whether Rent due or to become due under this Agreement has not been prepaid by more than one month;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.11 if the response to any of the foregoing matters is in the negative, a specification of all the precise reasons that necessitated the negative response in each instance; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.1.12 any other matter reasonably requested by the Landlord or any of its mortgagees, ground lessors or lessees or transferees or prospective mortgagees, ground lessors or lessees or transferees, including, without limiting the generality of the foregoing, such commercially reasonable information as the Landlord may request for purposes of assuring compliance with the Industrial Site Recovery Act (13 N.J.S.A. 1K-6 <u>et seq</u>.), as it may be amended, and any other applicable Federal, state or local statute, ordinance, rule, regulation or order concerned with environmental matters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.2 If, in connection with the Landlord's or a prospective transferee's obtaining financing or refinancing of the Carnegie Center Complex, the Property, the Building, the Common Facilities, any portion thereof or any interest therein, the Landlord or a prospective lender shall so request, the Tenant shall furnish to the requesting party within fifteen (15) days of the request:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.2.1 its written consent to any requested modifications of this Agreement provided that, in each such instance, the requested modification does not increase the Rent otherwise due or, in the reasonable judgment of the Tenant, otherwise materially increase the obligations of the Tenant under this Agreement or materially adversely affect the Tenant's leasehold interest created hereby or the Tenant's use and enjoyment of the Leased Premises (except in the circumstances contemplated by section 16 of this Agreement); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.2.2 summary financial information regarding its financial position as of the close of its most recently completed fiscal year and its most recently completed interim fiscal period and regarding its results of operations for the periods then ended and comparable year earlier periods, certified by the Tenant's chief financial officer to be a complete, accurate and fair presentation of the summary financial information purporting to be set forth therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;32.3 If the Landlord or any of its mortgagees gives notice to the Tenant of any of their respective names and addresses from time to time, the Tenant shall give notice to each such mortgagee of any notice of breach or default previously or afterwards given by the Tenant to the Landlord under this Agreement and provide in such notice that if the Landlord has not cured such breach or default within any permissible cure period then such mortgagee shall have the greater of (a) an additional period of thirty (30) days or (b) if such default cannot practically be cured within such period, such additional period as is reasonable under the circumstances, within which to cure such default. Upon request of the Landlord at any time or from time to time, the Tenant shall execute, acknowledge and deliver to the Landlord or its designee an acknowledgment of receipt of any such notice, an acknowledgment of receipt of any notice of assignment of this Agreement or rights hereunder by the Landlord to any of its mortgagees and the Tenant's agreement to the foregoing effect on the respective forms, if any, furnished by the Landlord or the respective mortgagees.

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33. <u>Appraisal, Waiver of Jury Trial and Arbitration</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;33.1 If the Landlord and the Tenant are unable, at any time of reference, to agree on the Market Rental Rate whenever a determination of the Market Rental Rate is required under this Agreement (other than in the context of Holdover Damages), within 15 days after this appraisal procedure is invoked by either party, each shall appoint one qualified appraiser of its choice which two appraisers shall then together choose a third qualified appraiser within 10 days after their appointment. Within 20 days after the appointment of the third appraiser, each of the three appraisers shall submit his or her opinion of the Market Rental Rate, as defined in, and at the time specified by, the definition of Market Rental Rate set forth in Exhibit E attached hereto, by notice to the Landlord and the Tenant. The Market Rental Rate shall be the arithmetic mean of the two closest appraisers' opinions, unless the absolute difference between the middle opinion and the highest and lowest opinion, respectively, is equal, in which case the middle opinion shall be the Market Rental Rate. Any determination of the Market Rental Rate in accordance with this subsection 33.1 of the Agreement shall be final and binding on, and not appealable by, the Landlord and the Tenant with respect to the respective instance in which the appraisal procedure was invoked. An appraiser shall be qualified, as that phrase is used in this subsection 33.1 of the Agreement, if he is independent, a member in good standing of the Appraisal Institute (successor to the American Institute of Real Estate Appraisers), has substantial prior experience appraising the market rental values of leased offices in office buildings located in central New Jersey and is not named in subsection 30.1 of this Agreement. The expense of the third appraiser shall be borne equally by the Landlord and the Tenant; otherwise each party shall bear the expense of its respective appraiser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;33.2 The parties hereby waive any right they might otherwise have to a trial by jury in connection with any dispute arising out of or in connection with this Agreement or the use and occupancy of the Leased Premises; and, except as otherwise set forth in subsection 33.1 of this Agreement, they hereby consent to arbitration of any such dispute in Princeton, New Jersey, in accordance with the rules for commercial arbitration of the American Arbitration Association or successor organization, except that the Landlord, in its sole discretion, may, with respect to any dispute involving either (i) the Landlord's right to re-enter and re-take possession of the Leased Premises or (ii) the determination of money damages following the occurrence of an Event of Default under this Agreement, elect to pursue any of or all its rights in any court of competent jurisdiction. Judgment upon any arbitration award may be entered in any court of competent jurisdiction.

34. <u>Severability</u>. If any term or provision of this Agreement, including, but not limited to, any waiver of contribution or claims, indemnity obligation, or limitation of liability or of damages, or the application of any such term or provision to any person or circumstance shall to any extent be conclusively determined by a court of competent jurisdiction to be illegal, invalid or otherwise unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law.

35. <u>Notices</u>. All notices contemplated by, permitted or required by this Agreement shall be in writing. All notices required by this Agreement shall be personally delivered or forwarded by certified mail-return receipt requested, or by a nationally recognized overnight delivery service provided confirmation can be readily obtained of delivery on the next business day, addressed to the intended party at its address first set forth above (adding, in the case of notices to the Landlord after the Commencement Date, "Attention: Lease Administration") or, in the case of notices to the Tenant during the Term or any other period during which the Tenant shall be in possession of the Leased Premises, at the Leased Premises. Either party may from time to time change the address prescribed in this Agreement for notices to it by notice to the other. All notices required under this Agreement shall be deemed given upon their deposit, properly addressed and postage prepaid, in a postal depository or upon personal delivery to the intended party or the next business day after delivery to an overnight courier as described above provided confirmation of delivery on the next business day is obtained, in either case, regardless of whether delivery shall be refused.

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36. <u>Captions</u>. Captions have been inserted at the beginning of each section of this Agreement for convenience of reference only and such captions shall not affect the construction or interpretation of any such section of this Agreement.

37. <u>Counterparts</u>. This Agreement may be executed in more than one counterpart, each of which shall constitute an original of this Agreement but all of which, taken together, shall constitute one and the same Agreement.

38. <u>Applicable Law</u>. This Agreement and the obligations of the parties hereunder shall be governed by and construed in accordance with the laws of the State of New Jersey.

39. <u>Exclusive Benefit</u>. Except as may be otherwise specifically set forth in this Agreement, this Agreement is made exclusively for the benefit of the parties hereto and their permitted assignees and no one else shall be entitled to any right, remedy or claim by reason of any provision of this Agreement.

40. <u>Successors</u>. This Agreement shall be binding upon the parties hereto and their respective successors and assigns.

41. <u>Amendments</u>. This Agreement contains the entire agreement of the parties hereto, subsumes all prior discussions and negotiations and, except as may otherwise be specifically set forth in this Agreement, this Agreement may not be amended or otherwise modified except by a writing signed by all the parties to this Agreement.

42. <u>Waiver</u>. Except as may otherwise be specifically set forth in this Agreement, the failure of any party at any time or times to require performance of any provision of this Agreement shall in no manner affect the right at a later time to enforce the same. No waiver by any party of any condition, or of the breach of any term, covenant, representation or warranty set forth in this Agreement, whether by conduct or otherwise, in any one or more instances shall be deemed to be or construed as a further or continuing waiver of any such condition or breach, or as a waiver of any other condition or of the breach of any other term, covenant, representation or warranty set forth in this Agreement. The Landlord's acceptance of, or endorsement on, any partial payment of Rent or any late payment of Rent from the Tenant shall not operate as a waiver of the Landlord's right to the balance of the Rent due on a timely basis regardless of any writing to the contrary on, or accompanying, the Tenant's partial payment or the Landlord's putative acquiescence therein.

43. <u>Course of Performance</u>. No course of dealing or performance by the parties, or any of them, shall be admissible for the purpose of obtaining an interpretation or construction of this Agreement at variance with the express language of the Agreement itself.

44. <u>Landlord</u><u>'</u><u>s Concessions</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1 If, (a)(i) no Event of Default shall have occurred or (ii) if any Event of Default shall have occurred, the Tenant shall have previously cured it in full or the Landlord shall have waived it and (b) if there shall not have been a History of Recurring Events of Default, the Landlord hereby grants to the Tenant a non-exclusive license (the "Antenna License"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.1 during the Term, at its sole cost and expense, to install, maintain and replace a single antenna and associated equipment (the "Antenna") on the roof of the Building and in other Common Facilities in the Building, at such locations to be approved by the Landlord in its sole discretion (the "Antenna Licensed Area") in accordance with plans to be submitted by the Tenant to the Landlord regarding the installation (or, when applicable, the replacement) of the Antenna, which shall include Antenna specifications, an electrical/cabling routing diagram, and the location of the devices the Antenna is intended to serve (the "Antenna Plan"); and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.1.1 during the Term to use and operate the Antenna exclusively for the Antenna Licensed Use (as hereinafter defined); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.1.2 have such access to the Antenna Licensed Area as may be necessary to accomplish the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.2 The Landlord is making the Antenna Licensed Area available to the Tenant under the Antenna License granted hereby in the Antenna Licensed Area's present "AS IS" condition. The Landlord makes no warranty or representation that the Antenna Licensed Area is suitable for the Antenna Licensed Use. The Tenant shall make whatever examination and study it deems necessary or appropriate to ascertain whether the Antenna Licensed Area is suitable for the Antenna Licensed Use. The Antenna License granted hereby is not exclusive; and the Landlord hereby reserves the right to grant, renew or extend similar or dissimilar licenses to any and all other persons. The Tenant's availing itself of any rights or incurring any obligations under or in connection with the Antenna License granted hereby shall be exclusively at the Tenant's expense and risk. The Tenant shall use the Antenna exclusively for telecommunications purposes to serve the Leased Premises (the "Antenna Licensed Use"). During the Antenna License, the Tenant shall: (i) maintain and repair both the Antenna and the Antenna Licensed Area; (ii) not damage the electrical or other systems or the structure of the Building or the Property or that of any tenant of Other Leased Premises in the course of installation, maintenance, operation, replacement, or removal of the Antenna; (iii) not permit or suffer the Antenna to interfere with the communications, data or video wires or cables of any other person or the signals carried thereby or by electromagnetic broadcast or with the computer equipment of any other person; and (iv) comply with all applicable Federal, state and local statutes, rules, regulations and ordinances and with rulings and orders of any governmental authority with jurisdiction regarding the Antenna or its installation, replacement, maintenance, removal or use. Prior to installation, the Tenant shall provide the Landlord with one complete copy of each of the Antenna's full specifications, installation manual, operational manual and any other manual provided by the manufacturer or installer and intended for the end user.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.3 The Tenant shall utilize the Landlord's supplied common antenna junction box and wireway conduit located on the roof of the Building for the installation of the Antenna.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.4 Notwithstanding anything to the contrary set forth in this subsection 44.1, the Tenant shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.4.1 not install any Antenna of such a size and weight that, in the reasonable opinion of the Landlord's structural engineer, would require any structural reinforcement of the Building or any of its components; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.4.2 pay the Landlord, in addition to all other Rent due under this Agreement the following amount(s) per month of the Term: (i) $100.00 for a satellite dish antenna up to 18 inches in diameter or width or for any other type of antenna up to 18 inches in length, (ii) $200.00 for a satellite dish antenna over 18 inches and not more than 36 inches in diameter or width or for any other type of antenna over 18 inches and not more than 36 inches in length, or (iii) $500.00 for a satellite dish antenna over 36 inches in diameter or width or for any other type of antenna over 36 inches in length.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.1.5 Upon termination of the Term, the Tenant shall, at its sole cost and expense, remove the Antenna and related wiring from the Antenna Licensed Area and the Leased Premises and restore: (i) any portions of the Antenna Licensed Area, the Leased Premises, the Building and the Property damaged in the process and (ii) the Antenna Licensed Area and the Leased Premises substantially to their condition immediately prior to the commencement of the installation of the Antenna, reasonable wear and use excepted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2 The Landlord hereby grants to the Tenant a non-exclusive license (the "SCS License"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.1 during the term, at its sole cost and expense, to install, maintain and replace a single supplemental cooling system and associated equipment (the "Supplemental Cooling System") utilizing the Common Facilities, including the roof of the Building, utility rooms and areas above the ceiling of the Leased Premises, at such locations to be approved by Landlord in its sole discretion (the "SCS Licensed Areas") in accordance with plans to be submitted by the Tenant to the Landlord regarding the installation (or, when applicable, the replacement) of the Supplemental Cooling System, which shall include Supplemental Cooling System specifications, the location of the Supplemental Cooling System equipment, a coolant and condensate piping diagram, an electrical/cabling routing diagram, a diagram of the means of support for the condensing unit to be placed on the roof of the Building, and the location of the devices the Supplemental Cooling System is intended to serve (the "Supplemental Cooling System Plan"); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.1.1 during the Term to use and operate the Supplemental Cooling System exclusively for the SCS Licensed Use (as hereinafter defined); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.1.2 have such access to the SCS Licensed Areas as may be necessary to accomplish the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.2 The Landlord is making the SCS Licensed Areas available to the Tenant under the SCS License granted hereby in the SCS Licensed Areas' present "AS IS" condition. The Landlord makes no warranty or representation that the SCS Licensed Areas are suitable for the SCS Licensed Use. The Tenant shall make whatever examination and study it deems necessary or appropriate to ascertain whether the SCS Licensed Areas are suitable for the SCS Licensed Use. The Landlord shall have no obligation whatsoever to repair, maintain or replace the Supplemental Cooling System. The SCS License granted hereby is not exclusive; and the Landlord hereby reserves the right to grant, renew or extend similar or dissimilar licenses to any and all other persons. The Tenant's availing itself of any rights or incurring any obligations under or in connection with the SCS License granted hereby shall be exclusively at the Tenant's expense and risk. The Tenant shall use the Supplemental Cooling System exclusively to provide cooling to equipment rooms (not cooling of people) in the Leased Premises (the "SCS Licensed Use"). During the SCS License, the Tenant shall: (i) maintain and repair both the Supplemental Cooling System and the SCS Licensed Areas; (ii) not damage the electrical or other systems or the structure of the Building or the Property or that of any tenant of Other Leased Premises in the course of installation, maintenance, operation, replacement, or removal of the Supplemental Cooling System; and (iii) comply with all applicable Federal, state and local statutes, rules, regulations and ordinances and with rulings and orders of any governmental authority with jurisdiction regarding the Supplemental Cooling System or its installation, replacement, maintenance, removal or use. Prior to installation, the Tenant shall provide the Landlord with one complete copy of each of the Supplemental Cooling System's full specifications, installation manual, operational manual and any other manual provided by the manufacturer or installer and intended for the end user.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.3 If the Supplemental Cooling System Plan shall require penetration of the Building's roof for the installation of any component of the Supplemental Cooling System and related piping and wiring, the Tenant shall, at its sole cost and expense, utilize a roofing contractor, selected by the Landlord, to perform any roof penetration and restoration work (including any restoration required by section 21 of this Agreement in connection with the removal of same). The Tenant shall cause the Supplemental Cooling System Plan to show the installation of rooftop walkways between the Building's

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nearest roof access and the equipment installed for the purpose of obviating wear and tear on the roof by contractors and technicians servicing the equipment from time to time and shall cause them to be installed; and, again utilizing a roofing contractor selected by the Landlord, the Tenant shall, at its sole cost and expense, restore the roof in a good and workmanlike manner to the condition it was in prior to the penetration, achieving full weatherproofing in the area of the penetration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.4 Notwithstanding anything to the contrary set forth in this subsection 44.2, the Tenant shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.4.1 be limited to a maximum of one roof penetration;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.4.2 not install any component of the Supplemental Cooling System of such a size and weight that, in the reasonable opinion of the Landlord's structural engineer, would require any structural reinforcement of the building or any of its components;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.4.3 not remove, except to repair or replace, any component of the Supplemental Cooling System without the prior written consent of the Landlord, which consent may be withheld for any reason in the sole discretion of the Landlord; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.2.4.4 upon termination of the Term, at the sole option of the Landlord, at the Tenant's sole cost and expense, remove the Supplemental Cooling System from the SCS Licensed Areas and restore: (i) any portions of the SCS Licensed Areas, the Building and the Property damaged in the process, and (ii) the SCS Licensed Areas substantially to their condition immediately prior to the commencement of the installation of the Supplemental Cooling System, reasonable wear and use excepted, including, but not limited to, utilizing a roofing contractor selected by the Landlord, the roof in a good and workmanlike manner to the condition it was in prior to the penetration, achieving full weatherproofing in the area of the penetration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.3 Intentionally Omitted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.4 If, prior to the respective date of exercise thereof, (a)(i) no Event of Default exists or (ii) if any Event of Default shall have occurred, the Tenant shall have previously cured it in full or the Landlord shall have waived it and (b) there shall not have been a History of Recurring Events of Default, at any time during the Initial Term, the Tenant shall have the right, exercisable exclusively at the time and in the manner set forth below in subsection 44.5 of this Agreement, to require that the Landlord (subject to any similar obligations of the Landlord to any tenants of the Carnegie Center Complex at the time such notice is received and provided that the Landlord is not negotiating with another prospective tenant or existing tenant of the Carnegie Center Complex for such space at the time that such notice is received) whenever the Landlord becomes aware of Available Space in the Building, give notice to the Tenant offering to lease such space to the Tenant at the Market Rental Rate then in effect (and specifying same) for a term commencing on the date set forth in the Landlord's notice and continuing for the greater of (a) the balance of the Initial Term, or (b) five (5) years, and the Tenant shall have the right, exercisable exclusively at the time and in the manner set forth below in subsection 44.6 of this Agreement, to accept such gross rentable floor space at the Market Rental Rate so specified for a term commencing on the date set forth in the Landlord's notice and continuing for the greater of (a) the balance of the Initial Term, or (b) five (5) years. Such requirement on the Landlord shall commence on the tenth (10th) day after the Tenant shall have timely and otherwise properly given each such notice to the Landlord and shall continue in effect until the earlier of: (i) the Tenant's timely and otherwise proper acceptance of any such offer made by the Landlord, (ii) the Tenant's failure to timely and otherwise properly accept any such offer made by the Landlord, or (iii) six (6) months after the Tenant shall have timely and otherwise properly given such notice to the Landlord provided that during such six (6) month period, there was no Available Space in the Building. This is the

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"Right to Lease Additional Space". The Right to Lease Additional Space may not be exercised by any person other than the original Tenant, Kardigan Bio and any assignee of Kardigan Bio pursuant to Section 17.6. Except with respect to assignments made pursuant to Section 17.6, in the event the Tenant assigns this Agreement or sublets, or licenses the use or occupancy of, the Leased Premises or any portions thereof in accordance with subsection 17 of this Agreement or otherwise, or attempts to do so, the Right to Lease Additional Space shall thereupon expire.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.5 The Tenant shall exercise its right to require the Landlord to give the notices and make the offers contemplated by subsection 44.4 of this Agreement by giving timely and otherwise proper notice to the Landlord of its desire to lease additional space.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;44.6 The Tenant shall exercise its right to accept the Landlord's offer of additional space contemplated by subsection 44.4 of this Agreement, by giving notice of acceptance to the Landlord within ten (10) business days after the Landlord gives notice of the offer to the Tenant. All additional space leased by the Tenant pursuant to the exercise of the Right to Lease Additional Space shall be taken AS IS. If the Tenant fails timely to accept any such offer of the Landlord pursuant to subsection 44.4 of this Agreement, its Right to Lease Additional Space shall thereupon terminate and be of no further force and effect.

45. <u>Electronic Signatures</u>. The parties acknowledge and agree that this Agreement may be executed by electronic signature, which shall be considered as an original signature for all purposes and shall have the same force and effect as an original signature. Without limitation, "electronic signature" shall include faxed versions of an original signature or electronically scanned and transmitted versions (e.g., via pdf) of an original signature.

[SIGNATURE PAGE TO FOLLOW]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date set forth herein.

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| | |
|:---|:---|
| LANDLORD: | LANDLORD: |
| CARNEGIE 506 ASSOCIATES, a New Jersey general partnership | CARNEGIE 506 ASSOCIATES, a New Jersey general partnership |
| BY: BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited partnership, a general partner | BY: BOSTON PROPERTIES LIMITED PARTNERSHIP, a Delaware limited partnership, a general partner |
| BY: BXP, Inc., a Delaware corporation, its general partner | BY: BXP, Inc., a Delaware corporation, its general partner |
| BY: | /s/ John K. Brandbergh |
| Name: | John K. Brandbergh, |
| Title: | Senior Vice President |
| TENANT: | TENANT: |
| KARDIGAN BIO, a Delaware corporation | KARDIGAN BIO, a Delaware corporation |
| By: | /s/ Brianne Jahn |
| Name: | Brianne Jahn |
| Title: | Chief Financial Officer |

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EXHIBIT A

LEASED PREMISES FLOOR SPACE DIAGRAM

![LOGO](g107928g0319174618836.jpg)

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EXHIBIT B

PROPERTY DESCRIPTION

DESCRIPTION OF 506 CARNEGIE CENTER

WEST WINDSOR TOWNSHIP

MERCER COUNTY, NEW JERSEY

Being known and designated as part of Lot 87 in Block 9, situated in West Windsor Township, Mercer County, New Jersey as shown on a map entitled, "Preliminary/Final Major Subdivision, lots 5, 7, 7.01, 7 .02, 8, 19 & 20, Block S-9, situated in West Windsor Twp., Mercer County, New Jersey", prepared by Lynch, Carmody, Guiliano & Karol, P.A., dated 10/21/85, revised through 11/25/86, filed in the Mercer County Clerk's office 5/29/87 as map no. 2841. Said parcel being more particularly described as follows:

Beginning at a point where the northeasterly line of Lot 12.01, Block 9, intersects with the common boundary line of Lot 87 with Lot 88 in Block 9, said point also being located south 40 degrees 36 minutes 23 seconds east a distance of 1,084.51 from a point in the southeasterly right-of-way line of U.S. Route 1 as widened and running;

Along the southeasterly line of Lot 88, Block 9 on a course north 42 degrees 48 minutes 22 seconds East a distance of 639.70 feet to a point in the southwesterly line of Lot 91, Block 9; thence Along the southwesterly line of Lot 91, Block 9 and Lot 86, Block 9 on a course south 47 degrees 11 minutes 38 seconds East a distance of 606.87 feet to a point in the northwesterly line of Lot 7.01, Block 9, said point also being formed by the intersection of the southerly corner of Lot 86, Block 9 and the easterly corner of Lot 87, Block 9; thence

Along the northwesterly line of Lot 7.01, Block 9, along a curve to the left having a radius of 350.00 feet, a central angle of 18 degrees 04 minutes 46 seconds, an arc distance of 110.44 feet, a chord bearing of south 27 degrees 50 minutes 45 seconds West, a chord distance of 109.98 feet to a point of tangency; thence

Continuing along the northwesterly line of Lot 7.01, Block 9 on a course South 18 degrees 48 minutes 22 seconds West a distance of 80.73 feet to a point; thence

Continuing along the northwesterly line of Lot 7.01, Block 9 on a course South 47 degrees 11 minutes 38 seconds East a distance of 158.86 feet to a point; thence

Continuing along the northwesterly line of Lot 7.01, Block 9 on a course South 02 degrees 11 minutes 38 seconds East a distance of 143.77 feet to a point; thence

Continuing along the northwesterly line of Lot 7.01, Block 9 on a course South 42 degrees 48 minutes 22 seconds West a distance of 233.34 feet to a point; thence

Continuing along the northwesterly line of Lot 7.01, Block 9 on a course North 47 degrees 11 minutes 38 seconds West a distance of 190.94 feet to a point; thence

Continuing along the northwesterly line of Lot 7.01, Block 9, along a curve to the right having a radius of 250.00 feet, a central angle of 22 degrees 38 minutes 20 seconds, an arc distance of 98.78 feet, a chord bearing of South 74 degrees 57 minutes 22 seconds West, a chord distance of 98.14 feet to a point; thence

Along the meadow road connector right-of-way line, on a course North 64 degrees 11 minutes 20 seconds East a distance of 71.61 feet to a point; thence

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Continuing along the meadow road connector right-of-way line, along a curve to the left having a radius of 33136 feet, a central angle of 12 degrees 13 minutes 08 seconds, an arc distance of 70.67 feet, a chord bearing of North 58 degrees 04 minutes 46 seconds East, a chord distance of 70.53 feet to a point; thence

Continuing along the meadow road connector right-of-way line, on a course North 37 degrees 50 minutes 11 seconds West, a distance of 1.18 feet to a point; thence

Continuing along the meadow road connector right-of-way line, along a curve to the right having a radius of 228.00 feet, a central angle of 87 degrees 13 minutes 48 seconds, an arc distance of 347.12 feet, a chord bearing of South 84 degrees 13 minutes 17 seconds East, a chord distance of 314.55 feet to a point; thence

Continuing along the meadow road connector right-of-way line, on a course North 40 degrees 36 minutes 23 seconds West, a distance of 126.17 feet to a point; thence

Continuing along the meadow road connector right-of-way line, on a course South 49 degrees 23 minutes 37 seconds West, a distance of 0.79 feet to a point; thence

Continuing along the meadow road connector right-of-way line, along a curve to the right having a radius of 646.33 feet, a central angle of 07 degrees 13 minutes 16 seconds, an arc distance of 81.46 feet, a chord bearing of North 36 degrees 59 minutes 45 seconds West, a chord distance of 81.40 feet to a point of compound curvature; thence

Continuing along the meadow road connector right-of-way line, along a curve to the right having a radius of 361.55 feet, a central angle of 07 degrees 34 minutes 27 seconds, an arc distance of 47.79 feet, a chord bearing of South 29 degrees 35 minutes 56 seconds East, a chord distance of 47.76 feet to a point; thence

Continuing along the meadow road connector right-of-way line, on a course South 25 degrees 48 minutes 40 seconds East, a distance of 80.43 feet to a point of curvature; thence

Continuing along the meadow road connector right-of-way line, along a curve to the right having a radius of 22.97 feet, a central angle of 31 degrees 47 minutes 38 seconds, an arc distance of 12.74 feet, a chord bearing of South 09 degrees 54 minutes 52 seconds East, a chord distance of 12.58 feet to a point (nontangent); thence

Along the northeasterly line of Lot 12.01, Block 9 on a course North 40 degrees 36 minutes 23 seconds West a distance of 566.72 feet to the point or place of beginning.

Containing 518,822 square feet of land (11.911 acres).

The above-described parcel is subject to a 56' wide roadway easement, two drainage easements and a greenway easement, all as shown on the above-referenced "plan of property".

Subject to easements of records.

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EXHIBIT C

BUILDING DESCRIPTION

The following is the Building Description referred to in the Agreement of which this exhibit is a part.

The Building's structure is of Construction Type 2C with a steel frame, a metal deck floor system, a brick exterior facade and insulated glass. The floors will sustain a live load of 100 pounds per square foot of rentable floor space and will have a typical bay size of 30 feet by 30 feet.

Among other Common Facilities, the Building contains one men's and one women's bathroom on each floor, one drinking fountain on each floor and two hydraulic elevators with a capacity of 3,500 pounds each and has Parking Facilities with approximately 479 lined parking spaces.

"Building standard" shall mean the type and grade of material, equipment, device or service reasonably designated by the Landlord as standard for leased premises in first-class office buildings in the Immediate Area.

The Tenant will include the following information as part of its Tenant Plan:

1. The location and extent of floor loading, if any, in excess of the Building standard specified above.

2. Special air conditioning requirements, if any, in excess of Building standard.

3. Plumbing requirements, if any.

4. Estimated total electrical load, including lighting requirements, lighting switch requirements and electrical outlet requirements, if any, in excess of building standard, setting forth the amount of the load, locations and types.

Design Conditions for the HVAC to produce the indoor conditions below noted (plus or minus 1%) when the outdoor conditions are as stated:

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| | | |
|:---|:---|:---|
|  | **Indoor Conditions** | **Outdoor Conditions** |
| **Summer** | 72 degrees Fahrenheit dry bulb | 95 degrees Fahrenheit dry bulb |
|  | Relative Humidity not to exceed 60% |  |
| **Winter** | 72 degrees Fahrenheit dry bulb | 10 degrees Fahrenheit dry bulb |

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The HVAC system consists of the following components:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Chiller | Chiller | Trane | CVHE032F | L90MO4863 | 320 Tons |
| Cooling Tower | Cooling Tower | BAC | 3644C | 91400022 | 800 GPM |
| Pump 5 | Chiller Water | B&G | 4G 12 1/2 | 7026AA | 40HP |
| Pump 6 | Chiller Water | B&G | 4G 12 1/2 | 7026HNW | 40HP |
| Pump 7 | Condenser Water | B&G | SBC 8 1/8 | 7026BA | 20HP |
| Pump 8 | Condenser Water | B&G | SBC 8 1/8 | 7026BN | 20HP |
| AHU-7 | Air Handler Unit | Trane | SBC 8 1/8 | K90L33389 | 21 Tons |
| AHU-8 | Air Handler Unit | Trane | DWDIFC | K90L33390 | 21 Tons |
| AHU-9 | Air Handler Unit | Trane | DWDIFC | K90L33391 | 25 Tons |
| AHU-10 | Air Handler Unit | Trane | DWDIFC | K90L33675 | 21 Tons |
| AHU-11 | Air Handler Unit | Trane | DWDIFC | K90L33392 | 21 Tons |
| AHU-12 | Air Handler Unit | Trane | DWDIFC | K90L33396 | 21 Tons |
| AHU-13 | Air Handler Unit | Trane | DWDIFC | K90L33397 | 25 Tons |
| AHU-14 | Air Handler Unit | Trane | DWDIFC | K90L33398 | 25 Tons |
| RAF-3 | Relief Fan A Wing | Trane | VO1202 | P/N VO1202AO8 | 5384 CFM |
| RAF-4 | Relief Fan B Wing | Trane | VO2202 | P/N VO2202AO8 | 5226 CFM |

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The building is fully sprinklered and has a Notifier 640 fire alarm system. The building has a Brivo building access control system to facilitate access beyond Regular Business Hours.

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EXHIBIT D

BUILDING RULES AND REGULATIONS

The following are the Building Rules and Regulations adopted in accordance with subsection 7.2.3 of the Agreement of which this exhibit is a part; and the Tenant and the Tenant's employees, other agents and Guests shall comply with these Building Rules and Regulations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The sidewalks, driveways, entrances, passages, courts, lobby, esplanade areas, plazas, elevators, vestibules, stairways, corridors, halls and other Common Facilities shall not be obstructed or encumbered or used for any purpose other than ingress and egress to and from the Leased Premises. The Tenant shall not permit or suffer any of its employees, other agents or Guests to congregate in any of the said areas. No door mat of any kind whatsoever shall be placed or left in any public hall or outside any entry door of the Leased Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. No awnings or other projections shall be attached to the outside walls of the Building. No curtains, drapes, blinds, shades or screens shall be attached to, hung in or used in connection with any window or door of the Leased Premises without the prior written consent of the Landlord. If such consent is given, such curtains, drapes, blinds, shades or screens shall be of a quality, type, design and color, and attached in the manner, approved by the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Except as otherwise specifically provided in subsection 18.1 of the Agreement, no sign, insignia, advertisement, object, notice or other lettering shall be exhibited, inscribed, painted or affixed so as to be visible from outside the Leased Premises or the Building. In the event of the violation of the foregoing by the Tenant, the Landlord may remove same without any liability and may charge the expense incurred in such removal to the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The sashes, doors, skylights, windows, and doors that reflect or admit light and air into the halls, passageways or other public places in the Building shall not be covered or obstructed and no bottles, parcels or other articles shall be placed on the window sills.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. No showcase or other articles shall be placed in front of or affixed to any part of the Building or the Common Facilities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. The lavatories, water and wash closets and other plumbing fixtures shall not be used for any purposes other than those for which they were designed and constructed, and no sweepings, rubbish, rags, acids or other substances shall be thrown or deposited therein. All damages resulting from any misuse thereof shall be repaired at the expense of the Tenant that permitted or suffered the violation hereof by the Tenant, the Tenant's employees, other agents or Guests.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. The Tenant shall not mark, paint, drill into or in any way deface any part of the Leased Premises, the Building, the Common Facilities or the Property. No boring, cutting or stringing of wires shall be permitted, except with the prior written consent of the Landlord, and as the Landlord may direct. Linoleum and other resilient floor coverings shall be laid so that the same shall not come in direct contact with the floor of the Leased Premises; and if linoleum or other resilient floor coverings are desired, an interlining of builder's deadening felt shall be first affixed to the floor by a paste or other material that is, and will remain, soluble in water. The use of cement or other adhesive material that either is not, or will not remain, soluble in water is prohibited.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. No bicycles, vehicles, animals, reptiles, fish or birds of any kind shall be brought into or kept in or about the Leased Premises.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. No noise including, without limiting the generality of the foregoing, music or the playing of musical instruments, recordings, radio or television which, in the reasonable judgment of the Landlord, might disturb tenants of Other Leased Premises shall be made or permitted by the Tenant. Nothing shall be done or permitted in the Leased Premises by the Tenant which would impair or interfere with the use or enjoyment of Other Leased Premises by any tenant thereof. Nothing shall be thrown out of the doors, windows or skylights or down the passageways of the Building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. The Tenant shall not manufacture any commodity, or prepare or dispense any foods or beverages, tobacco, flowers or other commodities or articles without the prior written consent of the Landlord. The Tenant shall not permit the installation or use of vending machines in the Leased Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. Duplicates of keys and passes distributed to the Tenant by the Landlord shall not be made. The Tenant shall provide appropriate security for keys. Nothing shall be done to render any lock inoperable by the Building Grand Master Key. No lock shall be installed without the Landlord's prior written consent; and any lock so installed shall be operable by the Building Grand Master Key. Upon termination of the Term, all keys, passes and duplicates provided by the Landlord to the Tenant, or otherwise procured by the Tenant, shall be returned to the Landlord. Any failure to comply with the foregoing which requires changes in locks, new or additional keys, passes or duplicates or other services of a locksmith shall be paid by the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. All deliveries and removals, and the carrying in or out of any safes, freight, furniture, packages, boxes, crates or any other object or matter of any description shall take place during such hours, in such manner and in such elevators and passageways as the Landlord may determine from time to time. The Landlord reserves the right to inspect all objects and matter being brought into the Building or the Common Facilities and to exclude from the Building and the Common Facilities all objects and matter that violates any of these Building Rules and Regulations or that are contraband. The Landlord may (but shall not be obligated to) require any person leaving the Building or the Common Facilities with any package or object or matter from the Leased Premises to establish his authority from the Tenant to do so. The establishment and enforcement of such a requirement shall not impose any responsibility on the Landlord for the protection of the Tenant against the removal of property from the Leased Premises. The Landlord shall not be liable to the Tenant for damages or loss arising from the admission, exclusion or ejection of any person to or from the Leased Premises or the Building or the Common Facilities under this rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. The Tenant shall not place any object in any portion of the Building that is in excess of the safe carrying or designed load capacity of the structure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. The Landlord shall have the right to prohibit any advertising or display of any identifying sign by the Tenant which in the Landlord's judgment tends to impair the reputation of the Building or its desirability; and, on notice from the Landlord, the Tenant shall refrain from or discontinue such advertising or display of such identifying sign.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15. The Landlord reserves the right to exclude from the Building and the Common Facilities during hours other than Regular Business Hours all persons who do not present a pass thereto signed by both the Landlord and the Tenant. All persons entering or leaving the Building or the Common Facilities during hours other than Regular Business may be required to sign a register. The Landlord will furnish passes to persons for whom the Tenant requests same in writing. The establishment and enforcement of such a requirement shall not impose any responsibility on the Landlord for the protection of the Tenant against unauthorized entry of persons.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16. The Tenant, before closing and leaving the Leased Premises at any time shall see that all lights and appliances generating heat (other than the heating system) are turned off. All entrance doors to the Leased Premises shall be left locked by the Tenant when the Leased Premises are not in use. At any time when the Building or the Common Facilities are locked during hours other than Regular Business Hours, the Building and the Common Facilities locks shall not be defeated by any means, such as by leaving a door ajar.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17. No person shall go upon the roof of the Building without the prior written consent of the Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18. Any requirements of the Tenant may be attended to only upon application at the office of the Building. The Landlord and its agents shall not perform any work or do any work or do anything outside of the Landlord's obligations under the Agreement except upon special instructions from the Landlord on terms acceptable to the Landlord and the Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19. Canvassing, soliciting and peddling in the Building and the Common Facilities are prohibited and the Tenant shall cooperate to prevent same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20. There shall not be used in any space, or in the public halls or other Common Facilities of the Building, in connection with the moving or delivery or receipt of safes, freight, furniture, packages, boxes, crates, paper, office material, or any other matter or thing, any hand trucks or dollies except those equipped with rubber tires, side guards and such other safeguards as the Landlord shall require. No hand trucks shall be used in passenger elevators, and no passenger elevators shall be used for the moving, delivery or receipt of the aforementioned articles. In connection with moving in or out any furniture, furnishings, equipment, heavy articles and heavy packages, the Tenant shall take such precautions as may be necessary to prevent excessive wear and tear in the Building's Common Facilities and the Leased Premises including, without limiting the generality of the foregoing, floor and wall treatments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. The Tenant shall not cause or permit any odors of cooking or other processes or any unusual or objectionable odors to emanate from the Leased Premises which might constitute a Nuisance. No cooking shall be done in the Leased Premises other than as specifically permitted in the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22. The Landlord reserves the right not to enforce any Building Rule or Regulation against any tenants of Other Leased Premises. The Landlord reserves the right to rescind, amend or waive any Building Rule and Regulation when, in the Landlord's reasonable judgment, it appears necessary or desirable for the reputation, safety, care or appearance of the Building or the preservation of good order therein or the operation of the Building or the comfort of tenants or others in the Building. No rescission, amendment or waiver of any Building Rule and Regulation in favor of one tenant shall operate as a rescission, amendment or waiver in favor of any other tenant.

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EXHIBIT E

DEFINITIONS AND INDEX OF DEFINITIONS

In accordance with section 1 of the Agreement of which this exhibit is a part, throughout the Agreement the following terms and phrases shall have the meanings set forth or referred to below:

1 "Additional Rent" means all amounts, other than Basic Rent and any Security Deposit, required to be paid by the Tenant to the Landlord in accordance with this Agreement.

2 "Affiliate" of any person means a person controlling, controlled by, or under common control with, that person.

3 "Agreement" means this Lease and Lease Agreement (including exhibits), as it may have been amended.

4 "Annual Amortized Capital Expenditure" means the payment amount determined as an annuity in arrears using the cost incurred by the Landlord for any Capital Expenditure as the present value, the number of years of its useful life (not exceeding ten (10) years) selected by the Landlord in accordance with generally applied real estate accounting practice as the number of periods and the Base Rate in effect when the respective improvement is first placed into service plus two (2) additional percentage points as the annual rate of interest; provided, however, if the Landlord reasonably concludes that a particular Capital Expenditure will effect savings in Operational Expenses, including, without limitation, energy, labor or other cost savings ("Projected Savings"), and if the "Projected Payback Period", as hereinafter defined, will be less than the useful life of the Capital Expenditure as determined above, then the Landlord shall amortize the Capital Expenditure based upon the Projected Payback Period, together with interest thereon at the interest rate as stated above in equal monthly payments. For the purpose herein, the "Projected Payback Period" shall be defined as the number of months or portion thereof required for the Projected Savings in Operational Expenses to equal the cost incurred by the Landlord for such Capital Expenditure.

5 "Available Space" shall mean, when used in the context of the Right to Lease Additional Space, Other Leased Premises located in 506 Carnegie Center which is located on the second floor of the Building that will become available for lease to others, generally and without limitation or restriction, due to the termination of the term of the lease with its then present tenant and the tenant's unwillingness to renew or otherwise extend the term, regardless of whether any such renewal or other extension is pursuant to a renewal or extension right or option set forth in the then present tenant's lease, or not.

6 "Base Rate" means the prime commercial lending rate per year as announced from time to time by JP Morgan Chase Bank (National Association) at its principal office in New York City.

7 "Base Year" means the full calendar year 2025 with respect to Operational Expenses and Taxes.

8 "Base Year Operational Expenses" means actual Operational Expenses incurred by the Landlord with respect to the applicable Base Year. Operational Expenses incurred by the Landlord with respect to the Base Year, adjusted as follows: projected and extrapolated to assume 95% occupancy of the Building by tenants obligated to pay full rent at any time when the Building is less than 95% occupied or is less than 95% occupied by tenants obligated to pay full rent (with the actual occupancy percentage by tenants paying full rent to be determined each calendar month during the applicable Base Year). Base Year Operational Expenses shall not include increases due to extraordinary circumstances, including but not limited to, Force Majeure, boycotts, conservation surcharges, security concerns, embargoes or shortages.

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9 "Base Year Taxes" means actual Taxes incurred by the Landlord with respect to the Property and the Building with respect to the Base Year.

10 "Basic Rent" is defined in subsection 3.2 of this Agreement.

11 "Building" means the office building erected on the Property which is commonly known as 506 Carnegie Center, Princeton, New Jersey 08540, as it may, in the Landlord's sole discretion, be increased, decreased, modified, altered or otherwise changed from time to time before, during or after the Term. As the Building is presently constructed it consists of 142,065 gross rentable square feet of floor space.

12 "Building Description" means Exhibit C attached hereto which generally describes the type of construction of the Building.

13 "Building standard" is defined in Exhibit C of this Agreement.

14 "Capital Expenditure" is defined in subsection 10.3 of this Agreement.

15 "Carnegie Center Complex" means the office development commonly known as Carnegie Center, Princeton (West Windsor Township), New Jersey, bounded on the north by Alexander Road and on the west by U.S. Route 1.

16 "Commencement Date" is defined in section 4 of this Agreement.

17 "Common Facilities" means the areas, facilities and improvements provided by the Landlord in the Building (except the Leased Premises and the Other Leased Premises) and on the Property, including, without limiting the generality of the foregoing, the Parking Facilities and driveways on the Property, for non-exclusive use by the Tenant in accordance with subsection 2.2 of this Agreement, as they may, in the Landlord's sole discretion, be increased, decreased, modified, altered or otherwise changed from time to time before, during or after the Term.

18 "Common Walls" means those walls which separate the Leased Premises from Other Leased Premises.

19 "Controllable Operational Expenses" shall mean all Operational Expenses other than non-controllable expenses, which shall include but shall not be limited to, snow removal, utilities, insurance and other nonrecurring items.

20 "Electric Charges" means all the supplying utility's charges for, or in connection with, furnishing electricity including charges determined by actual usage, any seasonal adjustments, demand charges, energy charges, energy adjustment charges and any other charges, howsoever denominated, of the supplying utility, including sales and excise taxes and the like.

21 "Event of Default" is defined in section 22 of this Agreement.

22 "Expiring Term" means, at the time of reference, the Term as it is then scheduled to expire.

23 "Force Majeure" means (i) strikes or other labor troubles, (ii) governmental preemption in connection with a national emergency, (iii) any rule, order or regulation of any government agency or any department or subdivision thereof, whether in connection with a drought, energy shortage or other like event or otherwise, (iv) any fact, condition or circumstance related to war, terrorism or other emergency, (v) fire, casualty or other acts of God (including the time necessary to repair any damage caused thereby), (vi) the inability to obtain labor or material due to shortage, governmental regulation or prohibition, or (vii) any other cause whatsoever beyond Landlord's reasonable control.

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24 The Tenant's "Guests" shall mean the Tenant's licensees, invitees and all others in, on or about the Leased Premises, the Building, the Common Facilities or the Property, either at the Tenant's express or implied request or invitation or for the purpose of soliciting or visiting the Tenant.

25 A "History of Recurring Events of Default" means the occurrence of three or more Events of Default (whether or not cured by the Tenant) in any period of twelve (12) months.

26 "Holdover Damages" is defined in subsection 23.4 of this Agreement.

27 The "Index" means the "all items" index figure for the New York Northeastern New Jersey average of the Consumer Price Index for all urban wage earners and clerical workers which uses a base period of 1982-84=100, published by the United States Department of Labor, so long as it continues to be published. If the Index is not published for a period of three consecutive months, or if its base period is changed, the term "Index" shall mean that index, as nearly equivalent in purpose, function and coverage as practicable to the original Index, which the Landlord shall have designated by notice to the Tenant.

28 "Initial Term" means the period so designated in subsection 4.1 of this Agreement.

29 "Landlord" means the person so designated at the beginning of this Agreement and those successors to the Landlord's interest in the Property and/or the Landlord's rights and obligations under this Agreement contemplated by section 26 of this Agreement.

30 "Landlord Party" or "Landlord Parties" shall mean the Landlord, any Affiliate of the Landlord, the Landlord's managing agents for the Building, each mortgagee, if any, each ground lessor, if any**,** and each of their respective direct or indirect partners, officers, shareholders, directors, members, trustees, beneficiaries, servants, employees, principals, contractors, licensees, agents or representatives.

31 "Landlord's Work" means the work to be performed by the Landlord pursuant to subsection 5.1 of this Agreement.

32 "Lease Year" means any twelve (12) month period during the Term of the Lease commencing as of the Rent Commencement Date, or as of any anniversary of the Rent Commencement Date, except that if the Rent Commencement Date does not occur on the first day of a calendar month, then (i) the first Lease Year shall further include the partial calendar month in which the first anniversary of the Rent Commencement Date occurs, and (ii) the remaining Lease Years shall be the successive twelve (12)-month periods following the end of such first Lease Year.

33 "Leased Premises" means that portion of the interior of the Building (as viewed from the interior of the Leased Premises) bounded by the interior sides of the unfinished floor and the finished ceiling on the second floor (as the floors have been designated by the Landlord) of the Building, the centers of all Common Walls and the exterior sides of all walls other than Common Walls, the outline of which floor space is designated on the diagram set forth in Exhibit A attached hereto, which portion contains 21,489 square feet of gross rentable floor space; and references within this Agreement to the gross rentable floor space of the Leased Premises shall mean the quantity herein specified.

34 "Legal Holidays" means New Year's Day, Presidents' Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day.

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35 "Market Rental Rate" means, at the time of reference, the gross rentable floor space of the Leased Premises multiplied by the greater of: (a) that annual rate of Basic Rent per square foot of gross rentable floor space which is then being quoted by the Landlord for comparable Other Leased Premises at which the Landlord, or other landlords, as the case may be, are then executing leases for new or renewing tenants for comparable leased space located in buildings in the Carnegie Center Complex and the buildings located at 7-9 Roszel Road, Princeton Overlook and University Square, all in West Windsor Township, New Jersey (or would then be quoted if comparable Other Leased Premises were then available), taking into consideration all relevant factors, including, without limitation: (i) the term of such lease, (ii) the terms of any workletter associated therewith, (iii) tenant improvement allowances, (iv) free rent or other concessions, and (v) the subject amount of square feet of gross rentable floor space, or (b) that annual rate of Basic Rent per square foot of gross rentable floor space in effect during the last twelve (12) months of the Expiring Term.

36 "Municipality" means the Township of West Windsor in Mercer County, New Jersey, or any successor municipality with jurisdiction over the Property.

37 "No Pass Through Period" means, in the context of Operational Expenses and Taxes, the period beginning on the Commencement Date and ending on December 31, 2025.

38 "Nuisance" means any condition or occurrence which unreasonably or materially interferes with the authorized use and enjoyment of the Other Leased Premises and the Common Facilities by any tenant of Other Leased Premises or by any person authorized to use any Other Leased Premises or Common Facilities or with the authorized use of any other areas, buildings or other improvements in the Carnegie Center Complex.

39 "Operational Expenses" is defined in subsection 10.2 of this Agreement.

40 "Option to Renew" is defined in subsection 6.1 of this Agreement.

41 "Other Leased Premises" means all premises within the Building, with the exception of the Leased Premises, that are, or are available to be, leased to tenants or prospective tenants, respectively.

42 "Parking Facilities" means the parking area located on the Property, containing the approximate number of lined parking spaces set forth in the Building Description, which parking area is provided as Common Facilities.

43 "Person" includes an individual, a corporation, a partnership, a limited liability company, a limited liability partnership, a trust, an estate, an unincorporated group of persons and any group of persons.

44 "Property" means the parcel of land, as it may, in the Landlord's sole discretion, be increased, decreased, modified, altered or otherwise changed from time to time before, during or after the Term, on which the Building is (or is about to be) erected. As the Property is presently constituted, it is more particularly described in Exhibit B attached hereto.

45 "Punchlist" shall mean a single written list prepared by the Landlord at or about the date of achievement of Substantial Completion of the Landlord's Work, setting forth those faults, defects and omissions in the Landlord's Work, which are in the nature of minor or cosmetic faults, defects and omissions.

46 "Regular Business Hours" means 8:00 A.M. to 7:00 P.M., Monday through Friday, and, upon at least 24 hours' request to the Landlord prior to the respective Saturday, on any Saturday from 8:00 A.M. to 1:00 P.M., except on Legal Holidays.

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47 "Re-Leasing Damages" is defined in subsection 23.3 of this Agreement.

48 "Renewal Term" means, at the time of reference, any portion of the Term, other than the Initial Term, as to which the Tenant has properly exercised an Option to Renew.

49 "Rent" means Basic Rent and Additional Rent.

50 "Rent Commencement Date" shall have the meaning assigned and ascribed to such term in Section 4.4 of this Agreement.

51 "Rent Concession Period" shall have the meaning assigned and ascribed to such term in Section 4.4 of this Agreement.

52 "Right to Lease Additional Space" shall have the meaning assigned and ascribed to such term in Section 44.4 of this Agreement.

53 "Security Deposit" is designated in section 29 of this Agreement.

54 "Substantial Completion" means that the Landlord's Work shall have been substantially completed as evidenced by the issuance of a Certificate of Occupancy by the Township of West Windsor, subject only to the completion or correction of Punchlist items.

55 "Substantial Completion Date" means the date that Substantial Completion of the Landlord's Work shall have been achieved, adjusted to an earlier date to compensate the Landlord for the cumulative number of days of delay attributable to Tenant Delay.

56 "Systems" means the building standard elevator, heating, ventilation and air conditioning, electrical, plumbing and fire alarm and suppression systems installed in the Building.

57 "Taxes" means, in any calendar year, the aggregate amount of real property taxes, assessments and sewer rents, rates and charges, state and local taxes, transit taxes and every other governmental charge, whether general or special, ordinary or extraordinary (except corporate franchise taxes and taxes imposed on, or computed as a function of, net income or net profits from all sources and except taxes charged, assessed or levied exclusively on the Leased Premises or arising exclusively from the Tenant's occupancy of the Leased Premises) charged, assessed or levied by any taxing authority with respect to the Property, the Building, the Common Facilities and any other improvements on the Property and an allocable portion of Taxes with respect to other portions of the Carnegie Center Complex, less any refunds or rebates (net of expenses incurred in obtaining any such refunds or rebates) of Taxes actually received by the Landlord during such calendar year with respect to any period during the Term for the benefit of the Tenant, tenants of Other Leased Premises and the Landlord. If during the Term there shall be a change in the means or methods of taxing real property generally in effect at the beginning of the Term and another type of tax or method of taxation should be substituted in whole or in part for, or in lieu of, Taxes, the amounts calculated under such other types of tax or by such other methods of taxation shall also be deemed to be Taxes. Until such time as the actual amount of Taxes for any calendar year becomes known, the amount thereof shall be the Landlord's estimate of Taxes for that calendar year.

58 "Tenant" means the person so designated at the beginning of this Agreement and its permitted successors and assigns.

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59 "Tenant Delay" means any period of delay encountered by the Landlord or its general contractor selected to perform the Landlord's Work in achieving Substantial Completion of the Landlord's Work or the issuance of the Municipality's building permits, that is attributable to the following: (i) any changes to the Landlord's Work made at the request of the Tenant; (ii) the failure of the Tenant to select the single color of the paint to be applied and the flooring to be installed as part of the Landlord's Work from the Landlord's samples within fourteen (14) days after the later to occur of (a) the execution and delivery to the Landlord of this Agreement by the Tenant, and (b) the execution and delivery to the Tenant of this Agreement by the Landlord; (iii) any labor dispute or disharmonious labor relations with the Landlord's general contractor, any of its subcontractors or any of their sub-subcontractors (of any tier) involving any direct contractor or other agent of the Tenant or any of its subcontractors or any of their sub-subcontractors (of any tier) when performing any preparation of the Leased Premises; (iv) any work performed by or for the Tenant (other than the Landlord's Work), or any delay in the commencement or performance or completion of any such work, which impedes the orderly coordination, sequence and progress of the Landlord's Work; (v) any flaw or other deficiency in any work performed by any direct contractor of the Tenant or any of its subcontractors or their sub-subcontractors (of any tier); (vi) any failure of any direct contractor of the Tenant or any of its subcontractors or their sub-subcontractors (of any tier) to properly connect and interface with the Landlord's Work including, without limiting the generality of, the foregoing, the installation of the Tenant's telecommunications and computer cabling and equipment, partitions, furniture and fixtures and other installations not included in the Landlord's Work; (vii) any delay in the Landlord's Work encountered as a result of attempting to integrate work of the Tenant's direct contractors with the Landlord's Work; (viii) any suspension or stoppage of the Landlord's Work at the request or instance of the Tenant or any of its agents; (ix) the lack of completion or the lack of satisfactory completion of any work performed by any direct contractor of the Tenant or any of its subcontractors or their subsubcontractors (of any tier) at any time when the Landlord's Work (or any portion thereof) is ready for any inspection or test required by the Municipality regarding the Landlord's Work; (x) the existence of any long lead time items in the Landlord's Work of which the Landlord shall have advised the Tenant in writing prior to the commencement of the construction of the Landlord's Work and which the Tenant elects to retain in the Landlord's Work; (xi) any delay in the issuance of the Municipality's Certificate of Occupancy as a result of any alterations, improvements or other modifications made by or on behalf of the Tenant in the Leased Premises (which shall be limited to the installation of the Tenant's telecommunications and computer cabling and equipment, partitions, furniture, fixtures and equipment) other than the Landlord's Work; (xii) the request by the Tenant for materials, finishes or installations other than Building Standard; and (xiii) any other delay caused by the Tenant or its design professionals, engineers, direct contractors, employees or other agents of which the Landlord shall have advised the Tenant which is not cured at once.

60 "Tenant Electric Charges" means Electric Charges attributable to the Tenant's use of electricity in the Leased Premises for purposes other than heating, ventilation and air conditioning provided to the Leased Premises by the Landlord in accordance with subsection 8.2.4 of this Agreement.

61 "Tenant Party" or "Tenant Parties" means the Tenant, any Affiliate of the Tenant, any permitted subtenant or any other permitted occupant of the Leased Premises, and each of their respective direct or indirect partners, officers, shareholders, directors, members, trustees, beneficiaries, servants, employees, principals, contractors, licensees, agents, invitees or representatives.

62 "Tenant Plan" means construction drawings and related construction specifications regarding the build-out of the Leased Premises (with any construction drawings in a reproducible diazo sepia mylar form) including, without limiting the generality of the foregoing, the information called for by the Building Description attached hereto as Exhibit C, signed and sealed by a New Jersey-licensed architect, and also furnished on AutoCad, complying in all respects with all applicable building and fire codes and regulations and insurance underwriting standards in effect and, to the extent they are not inconsistent with this Agreement, with the Landlord's tenant construction specifications in effect and in sufficient detail to permit the Municipality to issue any required building permits and to permit skilled contractors to supply and perform the work called for therein.

------

63 "Tenant's Property" is defined in subsection 14.2 of this Agreement.

64 "Tenant's Share" of any amount means 15.13% percent.

65 "Term" means the Initial Term plus, at the time of reference, any Renewal Terms.

66 "Termination Damages" is defined in subsection 23.2 of this Agreement.

------

EXHIBIT F

<u>JANITORIAL SERVICES DESCRIPTION</u> 

<u>LEASED PREMISES</u> 

<u>Nightly</u>:

1 Vacuum clean carpets and rugs.

---

| | |
|:---|:---|
| 2 | Empty all wastepaper baskets. Cleaners will not remove and/or clean tea or coffee cups or similar containers; also, if such liquids are spilled in wastebaskets, the wastebaskets will be emptied but not otherwise cleaned. Cartons or refuse in excess of that which can be placed in wastebaskets will not be removed. Tenants are required to make arrangements with the building manager for the disposal of such unusual refuse, for which the Tenant may incur additional charges.  |

---

3 Remove waste paper and waste material to a designated area in the building.

4 Dust and wipe clean all desks, furniture, windowsills and chair rails.

5 Wash/clean all water fountains.

<u>Monthly</u>:

1 Do high dusting including all venetian blinds and pictures, frames and similar wall hangings not reached in nightly cleaning.

2 Dust exterior of all wall mounted lighting fixtures.

3 Dust any door louvers.

4 Wash and wax all resilient flooring in office area.

<u>LAVATORIES:</u> 

<u>Nightly</u>:

1 Sweep and wash all flooring.

2 Wash and polish all mirrors, powder shelves, etc.

3 Wash both sides of all toilet seats.

4 Dust all partitions, tile walls, dispensers and receptacles.

5 Remove waste paper and refuse to designated area in the building.

6 Fill toilet tissue holders, soap dispensers and towel dispensers.

<u>Monthly</u>:

1 Machine scrub flooring.

2 Wash all partitions, tile walls and enamel surfaces.

------

3 Dust exterior of all wall mounted lighting fixtures.

4 Do all high dusting.

<u>MAIN LOBBY, ELEVATORS AND CORRIDORS</u>:

<u>Nightly</u>:

1 Vacuum entrance lobby and corridors.

2 Spot for stains.

3 Vacuum elevator floor.

4 Elevator cab to be wiped clean and polished.

<u>DAY CUSTODIAN</u>:

<u>Daily</u>:

1 Clean and sanitize lavatories.

2 Empty and clean paper towel and sanitary disposal receptacles and refill same.

3 Keep public areas in neat and orderly condition at all times.

4 Wash lobby entrance door windows in and out.

5 Keep parking lot area free of papers and general debris.

6 Custodian shall be available for special tasks and shall fix minor problems that arise in the Building as assigned by BXP management personnel, such as cleaning up spills, changing light tubes, etc.

<u>SCHEDULE OF CLEANING SERVICES</u>:

<u>Day Custodian</u>:

1 Day custodian services as listed herein, shall be performed five (5) days per week (Monday through Friday) except on BXP Management's legal Holiday Schedule.

2 Daily working hours: 7:30 a.m. – 4:00 p.m.

<u>Night Cleaners</u>:

1 All night cleaning service, as listed herein, shall be performed five(5) nights per week (Monday through Friday), except on BXP Management's legal Holiday Schedule.

------

EXHIBIT G-1

Additional Insureds

Carnegie 506 Associates, a New Jersey General Partnership

BP III LLC, a Delaware limited liability company

BXP, Inc., a Delaware corporation

Boston Properties Limited Partnership, a Delaware limited partnership

BP Management, L.P., a Delaware limited partnership

Boston Properties LLC, a Delaware limited liability company

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Exhibit G-2

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| | | |
|:---|:---|:---|
| ![LOGO](g107928g0319174619372.jpg)  | FORM OF CERTIFICATE OF LIABILITY INSURANCE | EXHIBIT G |
| ![LOGO](g107928g0319174619372.jpg)  | **CERTIFICATE OF LIABILITY INSURANCE** | DATE (MM/DD/YYYY) |
| THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. | THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. | THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. |
| IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). | IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). | IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). |
| PRODUCER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CONTACT<br> NAME: | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CONTACT<br> NAME: |
| PRODUCER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PHONE<br> (A/C, No. Ext):<br>| FAX<br> (A/C, No.)<br>|
| PRODUCER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; E-MAIL<br> ADDRESS: | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; E-MAIL<br> ADDRESS: |
| PRODUCER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER(S) AFFORDING COVERAGE<br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NAIC#<br>|
| PRODUCER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER A:<br>|  |
| INSURED | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER B:<br>|  |
| INSURED | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER C:<br>|  |
| INSURED | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER D:<br>|  |
| INSURED | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER E:<br>|  |
| INSURED | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; INSURER F:<br>|  |

---

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| | | |
|:---|:---|:---|
| **COVERAGES** | **CERTIFICATE NUMBER:** | **REVISION NUMBER:** |

---

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. | THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS, EXCLUSIONS AND CONDITIONS OF SUCH POLICIES LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. |
| INSR<br> LTR | TYPE OF INSURANCE | TYPE OF INSURANCE | ADDL<br>INSR. | SUBR<br>WVD. | POLICY<br>NUMBER | POLICY EFF<br>(MM/DD/YYYY) | POLICY EXP<br>(MM/DD/YYYY) | LIMITS | LIMITS |
|  | GENERAL LIABILITY<br> ☐ COMMERCIAL GENERAL LIABILITY<br> ☐☐CLAIMS MADE ☐ OCCUR<br> ☐ <br> ☐<u> </u><br> GEN'L AGGREGATE LIMIT APPLIES PER<br> ☐ POLICY ☐ PROJECT ☐ LOC |  | ☐ | ☐ |  |  |  | EACH OCCURRENCE<br>DAMAGE TO RENTED<br>PREMISES (Ea occurrence)<br>MED EXP (Any one person)<br>PERSONAL & ADV INJURY<br>GENERAL AGGREGATE<br>PRODUCTS – COMP/OP AGG | $ $$$$$$ |
|  | AUTOMOBILE LIABILITY<br> ☐ ANY AUTO<br> ☐ ALL OWNED AUTOS ☐ SCHEDULED AUTOS<br> ☐ HIRED AUTOS ☐ NON-OWNED AUTOS<br> ☐ ☐ |  | ☐ | ☐ |  |  |  | COMBINED SINGLE LIMIT<br> <u>(Ea accident)</u><br> BODILY INJURY (Per person)<br>BODILY INJURY (Per accident)<br>PROPERTY DAMAGE | <br> $$$$$ |
|  | ☐UMBRELLA LIAB ☐ OCCUR<br> ☐ EXCESS LIAB ☐ CLAIMS MADE<br> ☐ DED ☐RETENTION $ |  | ☐ | ☐ |  |  |  | EACH OCCURANCE<br>AGGREGATE |  |
|  | WORKERS COMPENSATION<br> AND EMPLOYERS' LIABILITY<br> ANY<br> PROPRIETOR/PARTNER/EXECUTIVE<br> FFICE/MEMBER EXCLUDED?<br> (Mandatory in NH)<br> If yes. describe under<br> DESCRIPTION OF OPERATIONS below | Y/N<br> ☐ | N/A | ☐ |  |  |  | ☐ WC STATU-☐ OTHER<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TORY LIMITS<br> E.L. EACH ACCIDENT<br> E.L DISEASE - EA EMPLOYEE<br>E.L. DISEASE - POLICY LIMIT | <br>$$$ |
|  |  |  | ☐ | ☐ |  |  |  |  |  |
| DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) | DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (Attach ACORD 101, Additional Remarks Schedule, if more space is required) |

---

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| | |
|:---|:---|
| **CERTIFICATE HOLDER** | **CANCELLATION** |
| | SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. |
| | <br> AUTHORIZED REPRESENTATIVE |

---

© 1988-2010 ACORD CORPORATION. All rights reserved

ACORD 25 (2010/05) The ACORD name and logo are registered marks of ACORD

------

Exhibit G-3

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| | | | | |
|:---|:---|:---|:---|:---|
| ![LOGO](g107928g0319174619372.jpg)  | FORM OF CERTIFICATE OF PROPERTY INSURANCE | FORM OF CERTIFICATE OF PROPERTY INSURANCE | FORM OF CERTIFICATE OF PROPERTY INSURANCE | EXHIBIT H |
| ![LOGO](g107928g0319174619372.jpg)  | **EVIDENCE OF LIABILITY INSURANCE** | **EVIDENCE OF LIABILITY INSURANCE** | **EVIDENCE OF LIABILITY INSURANCE** | DATE (MM/DD/YYYY) |
| **THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST.** | **THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST.** | **THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST.** | **THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST.** | **THIS EVIDENCE OF PROPERTY INSURANCE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE ADDITIONAL INTEREST NAMED BELOW THIS EVIDENCE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE EVIDENCE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE ADDITIONAL INTEREST.** |
| **AGENCY** | **PHONE**<br> **(A/C, No, Ext.)**<br>| **COMPANY** |  |  |
| **FAX**<br> **(A/C, No)**<br>| **EMAIL**<br> **ADDRESS**<br>|  |  |  |
| **CODE:**<br>| **SUB CODE:** |  |  |  |
| **AGENCY**<br> **CUSTOMER ID #:** | **AGENCY**<br> **CUSTOMER ID #:** |  |  |  |
| **INSURED** |  | LOAN NUMBER<br>| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;POLICY NUMBER | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;POLICY NUMBER |
|  |  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EFFECTIVE DATE | EXPIRATION DATE | ☐ **CONTINUED UNTIL**<br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TERMINATED IF CHECKED |
|  |  | THIS REPLACES PRIOR EVIDENCE DATED: | THIS REPLACES PRIOR EVIDENCE DATED: | THIS REPLACES PRIOR EVIDENCE DATED: |

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**PROPERTY INFORMATION** 

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| |
|:---|
| LOCATION/DESCRIPTION |
| THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. ANY REQUIREMENT TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS EVIDENCE OF PROPERTY INSURANCE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. |

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**COVERAGE INFORMATION** 

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| | | |
|:---|:---|:---|
| <br> COVERAGE / PERILS / FORMS | AMOUNT OF INSURANCE | DEDUCTIBLE |

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**REMARKS (Including Special Conditions)** 

**CANCELLATION** 

<br> **SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS**<br>

**ADDITIONAL INTEREST** 

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| | | |
|:---|:---|:---|
| NAME AND ADDRESS | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MORTGAGEE | ADDITIONAL INSURED |
| NAME AND ADDRESS | <br> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LOSS PAYEE |  |
| NAME AND ADDRESS | **LOAN #** | **LOAN #** |
| NAME AND ADDRESS | <br> **AUTHORIZED REPRESENTATIVE** | <br> **AUTHORIZED REPRESENTATIVE** |
| **ACORD 27 (2009/12)** |© **1993-2009 ACORD CORPORATION. All rights reserved.** |© **1993-2009 ACORD CORPORATION. All rights reserved.** |

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**The ACORD name and logo are registered marks of ACORD** 

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EXHIBIT H

SPACE PLAN

![LOGO](g107928g0319174619997.jpg)

## Exhibit 21.1

**Exhibit 21.1** 

**List of Subsidiaries** 

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| | |
|:---|:---|
| **Subsidiary**  | **Jurisdiction of Incorporation** |
| Rancho Santa Fe Bio, Inc. | Delaware |
| Prolaio, Inc. | Delaware |

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