Tempest Therapeutics Inc

This management proposal asks shareholders to approve, pursuant to Nasdaq Rule 5635(c) and (d), the issuance of up to 1,851,854 shares of common stock issuable upon exercise of Series A and Series B warrants (the PIPE Warrants) issued in connection with a March 20, 2026 private placement and related securities purchase agreement (SPA). Management seeks approval because Nasdaq rules require stockholder approval when securities convertible into common stock may be issued at prices below certain market thresholds or where such issuance could represent 20% or more of outstanding shares; the Company specifically notes that shares issuable upon exercise of the PIPE Warrants may be considered “equity compensation” or otherwise trigger Rule 5635(d). The PIPE Warrants were issued alongside shares or pre-funded warrants to institutional investors and Factor Bioscience Inc., an affiliate connected to CEO/director Matthew Angel, creating a potential related-party interest and heightening the Nasdaq approval requirement. The proposal would permit the Series A Warrants (five-year term) and Series B Warrants (24-month term) at an exercise price of $2.16 to become exercisable following stockholder approval, subject to customary beneficial ownership limitations and adjustment provisions. Management argues approval is necessary to allow the purchasers to exercise the warrants and access capital from the private placement, which the Company says is important for liquidity and funding operations. The filing warns that failure to approve would keep exercise limitations in place, require repeated meetings every 90 days until approval or warrant termination, and could harm the Company’s financing prospects and increase administrative costs. The Board unanimously recommends a vote FOR, emphasizing compliance with Nasdaq rules and the business need for the financing to support ongoing operations. Investors should weigh potential dilution (and market impact of resale once registration is effective) and the related-party element involving Factor and the CEO when evaluating the merits of the proposal.

This management proposal requests shareholder approval under Nasdaq Rule 5635(d) to allow issuance of up to 2,344,828 shares of common stock upon exercise of Inducement Warrants issued as part of an inducement transaction dated May 28, 2026, in which an investor agreed to immediately exercise certain existing warrants at a reduced exercise price in exchange for the issuance of new unregistered Inducement Warrants. Management frames the vote as required by Nasdaq because the shares issuable upon exercise may represent 20% or more of outstanding shares and were issued for an effective price below the minimum pricing threshold under the rule. The Inducement Warrants have a $1.73 exercise price, two-year term, and contain customary beneficial ownership limitations and adjustment provisions; placement agent warrants with substantially similar terms were also issued to H.C. Wainwright designees. Company disclosure states the inducement transaction closed on June 1, 2026 and that approval is necessary to permit the investor to exercise these warrants, facilitating access to expected cash proceeds that the Company considers important to support liquidity and fund operations. Management warns that failure to obtain approval would prevent exercise of the Inducement Warrants, require repeated special meetings every 90 days until approval or warrant expiration, and could negatively affect future financing prospects and increase administrative costs. The Board unanimously recommends a vote FOR, citing Nasdaq compliance and the financing/operational rationale. Shareholders should consider the dilution risk, market impact of potential resale upon registration effectiveness, and the economic terms of the inducement when assessing the proposal.