Lunai Bioworks Inc

This management proposal asks stockholders to approve an amendment to the Company’s Certificate of Incorporation to authorize the Board to effect a reverse stock split of the Company’s common stock at any ratio between 1-for-3 and 1-for-30, with the Board retaining sole discretion to select the exact ratio and to abandon the split prior to effectiveness. Management seeks this authority primarily to increase the per-share trading price to assist in maintaining the Company’s Nasdaq listing, following a prior 1-for-10 reverse split and a subsequent Nasdaq notice of delisting for failing to meet the $1.00 minimum bid price. The Board argues that approving a range of ratios, rather than a single fixed ratio, gives it flexibility to choose a ratio that best aligns with market conditions, trading volume, Nasdaq listing considerations, and anticipated effects on stockholder value at the time of implementation. The proposal also contemplates rounding up fractional shares to the next whole share and states that the number of authorized shares will remain unchanged, which effectively increases authorized but unissued shares and could enable future issuances without further stockholder approval. Management notes potential benefits including improved marketability, liquidity, attractiveness to institutional investors, enhanced ability to access capital and to grant equity-based compensation, but acknowledges risks such as potential lack of proportional price increase, reduced liquidity due to fewer outstanding shares, and possible dilution if additional authorized shares are issued later. The filing discloses that the Board will not proceed to file the Certificate of Amendment unless the applicable voting standard is satisfied and that the voting standard may change depending on whether the Company remains listed on Nasdaq at the time the amendment becomes effective (i.e., Section 242(d)(2) vs. Section 242(b)(1) of the DGCL). The Board recommends a FOR vote, citing the potential to meet Nasdaq minimum bid requirements and other marketability benefits, while warning there is no assurance the reverse split will achieve these objectives and noting the Company may still face delisting risk.

This management proposal requests authority from stockholders to adjourn the Special Meeting, if necessary, in order to solicit additional proxies to obtain approval of Proposal 1 (the Reverse Stock Split). Management seeks this vote as a procedural safeguard so that, if the Reverse Stock Split lacks sufficient votes at the time of the meeting, the meeting can be postponed or adjourned to allow further solicitation rather than terminating without a decision. The adjournment would be approved by a majority of shares present or represented at the meeting and abstentions would count as votes against the adjournment. The Board indicates it will not seek adjournment if sufficient votes have already been received, so approval is essentially precautionary. The proposal is routine in function but important operationally because of the uncertain voting outcome for the split and potential implications of Nasdaq listing status on applicable voting standards; securing the ability to adjourn increases the Board’s options to obtain the necessary vote threshold. The Board recommends a FOR vote to preserve flexibility in the event additional time for solicitation is required.