Announcement • May 12
Lunai Bioworks Inc Receives Receipt of Nasdaq Staff Determination Letter Regarding Compliance with Listing Rule On April 28, 2026, Lunai Bioworks Inc. (the "Company") received a staff determination letter from the Listing Qualifications Staff of The Nasdaq Stock Market LLC ("Nasdaq") formally notifying the Company that, based upon its continued non-compliance with the $35,000,000 market value of listed securities ("MVLS") requirement set forth in Nasdaq Listing Rule 5550(b)(2) (the "MVLS Rule") upon the expiration of the relevant grace period on April 27, 2026, the MVLS deficiency may serve as an additional basis for delisting the Company's securities from Nasdaq. At the Company's hearing before the Nasdaq Hearings Panel (the "Panel") on March 26, 2026, the Company presented its plan to regain compliance with both the bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the "Bid Price Rule"), the deficiency that precipitated the hearing, and the $2.5 million stockholders' equity requirement set forth in Nasdaq Listing Rule 5550(b)(2) (the "Equity Rule"), which serves as an alternative to, and in lieu of compliance with, the MVLS Rule, with the understanding that the grace period for MVLS compliance would expire on April 27, 2026. As previously disclosed, by decision dated April 20, 2026, the Panel granted the Company's request for continued listing on The Nasdaq Capital Market pursuant to an exception through May 1, 2026, to evidence compliance with the Equity Rule (in lieu of compliance with the MVLS Rule), and through June 1, 2026, to evidence compliance with the Bid Price Rule. On May 1, 2026, the Company completed a merger and issued shares of Series B Preferred Stock having an aggregate stated value of $20,000,000 to the former equityholders of the acquired company. The merger and the related issuance of the Series B Preferred Stock was the principal transaction undertaken by the Company in support of its plan to regain compliance with the Equity Rule. At the Company's special meeting of stockholders held on May 8, 2026, the Company's stockholders approved a proposal authorizing the Company's Board of Directors to amend the Company's Certificate of Incorporation to effect a reverse stock split of the Common Stock at a ratio in the range of 1-for-3 to 1-for-30, with the exact ratio to be determined by the Board of Directors in its sole discretion. The Company intends to implement a reverse stock split at a ratio sufficient to evidence compliance with the Bid Price Rule. Due to the short delay in the special meeting of stockholders, the Company has requested a short extension from the Panel to evidence compliance with the Bid Price Rule. New Risk • Feb 27
New major risk - Market cap size The company's market capitalization is less than US$10m. Market cap: US$9.67m This is considered a major risk. Companies with a small market capitalization are most likely businesses that have not yet released a product to market or are simply a very small company without a wide reach. Either way, risk is elevated with these companies because there is a chance the product may not come to fruition or the company's addressable market or demand may not be as large as expected. In addition, if the company's size is the main factor, it is less likely to have many investors and analysts following it and scrutinizing its performance and outlook. Currently, the following risks have been identified for the company: Major Risks Less than 1 year of cash runway based on free cash flow trend (-US$5.7m free cash flow). Share price has been highly volatile over the past 3 months (18% average weekly change). Negative equity (-US$14m). Earnings have declined by 28% per year over the past 5 years. Shareholders have been substantially diluted in the past year (52% increase in shares outstanding). Revenue is less than US$1m. Market cap is less than US$10m (US$9.67m market cap). New Risk • Feb 18
New major risk - Financial position The company has less than a year of cash runway based on its current free cash flow trend. Free cash flow: -US$5.7m This is considered a major risk. With less than a year's worth of cash, the company will need to raise capital or take on debt unless its cash flows improve. This would dilute existing shareholders or increase balance sheet risk. Currently, the following risks have been identified for the company: Major Risks Less than 1 year of cash runway based on free cash flow trend (-US$5.7m free cash flow). Share price has been highly volatile over the past 3 months (21% average weekly change). Negative equity (-US$14m). Earnings have declined by 27% per year over the past 5 years. Shareholders have been substantially diluted in the past year (52% increase in shares outstanding). Revenue is less than US$1m. Minor Risk Market cap is less than US$100m (US$16.1m market cap). 
