Indaptus Therapeutics Inc

This management proposal asks shareholders to approve a new 2026 Equity Incentive Plan to authorize equity awards (stock options, SARs, restricted stock and RSUs, performance awards and other equity-based awards) to employees, directors and consultants, with an initial share reserve equal to 10% of outstanding common stock (the company expects ~11,324,232 shares based on outstanding shares as of the proxy) and an automatic annual increase equal to 5% of outstanding shares on each January 1 from 2027 through 2031 unless the Board or Compensation Committee elects to reduce such increases. Management is seeking approval because equity awards granted under the Plan (including incentive stock options) require stockholder authorization, and the Company intends to use the Plan to attract, retain and motivate personnel and align their interests with stockholders. The Plan includes an ISO limit equal to the initial reserve, administration by the Board or a designated committee with broad discretion over grants and terms, and a termination of the prior 2021 Plan for future grants; it also contains standard change-in-control, transferability and minimum vesting provisions with limited exceptions. From a governance and compensation perspective the request is typical for a small public company building a talent retention program, but material features that investors should note include the size of the initial pool (10% of outstanding shares), an evergreen-style annual increase (5% for five years) that can dilute shareholders if fully used, and the Board’s discretion over award terms and any annual increase reductions. The Company discloses that the initial expected number of shares and ISO limit are based on outstanding shares at the time of the proxy and that the Plan will become effective upon stockholder approval. The Board recommends FOR the Plan, arguing it is necessary to implement an equity-based incentive program to support execution and align management and stockholders, while noting safeguards such as the ability for the Board/Committee to reduce the automatic increases. Material investor considerations include potential dilution (11+ million shares expected initially and further potential increases), the form and size of awards to insiders, and the interplay with the terminated 2021 Plan (which will remain outstanding for existing awards but not receive future grants). Analysts should evaluate the proposed reserve relative to peer practices, historical equity usage, expected hiring and retention needs, and how the grant policy may affect future dilution and executive compensation outcomes.

This management proposal seeks pre-approval under Nasdaq Rule 5635(d) to permit the company to issue, in one or more private placements (including potential PIPEs), up to $300 million of common stock at prices in the $0.60–$1.00 per share range, which depending on the final price and number of shares could result in issuance of 20% or more of outstanding common stock or voting power within 12 months of approval. Management requests this authorization to preserve the ability to pursue time-sensitive financing opportunities without delay and to provide the flexibility to raise material capital needed for working capital, R&D, debt repayment, potential investments or acquisitions. The board emphasizes utility and speed in a thin-cap biotech context but acknowledges that such financings, particularly at the low end of the stated price range, could be highly dilutive — the proxy gives illustrative examples showing hundreds of millions of new shares at $0.60–$1.00. The proposal is framed as a compliance action with Nasdaq’s 20% rule; if not approved, the company’s ability to consummate below-Minimum Price or >20% private placements would be limited, potentially forcing more costly or slower alternatives. From a governance perspective, investors should weigh the company’s immediate capital needs and past financing history (recent private placements and warrant repricings disclosed in the proxy) against dilution risk, downward pressure on market price, and potential changes in ownership concentration given large existing holders disclosed in the filing. The Board recommends FOR to retain strategic optionality, but sophisticated investors should factor in the likelihood of dilutive financings, the company’s burn rate and alternatives to equity funding, and require clarity on governance protections, investor rights in any private placement, pricing mechanics relative to the Nasdaq Minimum Price, and potential anti-dilution or transfer restrictions that could affect long-term shareholder value.