InMed Pharmaceuticals Inc 8-K, filed Nov 10, 2026
InMed Pharmaceuticals Inc. (MTRI)
About this 8-K
InMed Pharmaceuticals Inc filed this 8-K on November 10, 2026, reporting on events of November 6, 2026.
Items reported
- Item 1.01: Entered into a material agreement
- Item 2.01: Completed an acquisition or sale of assets
- Item 2.02: Financial results
- Item 3.02: Unregistered sale of equity
- Item 3.03: Change to shareholders' rights
- Item 5.01: Change in control
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 5.05: Code of ethics change or waiver
- Item 5.06: Change in shell company status
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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INTRODUCTORY NOTE
On November 6, 2026 (the “Closing Date”), Mentari Therapeutics, Inc., a Nevada corporation (formerly known as InMed Pharmaceuticals Inc.) (prior to the Closing Date, unless context otherwise requires, “InMed” and, after the Closing Date, the “Company”), consummated the previously announced business combination (the “Closing”) pursuant to that certain Agreement and Plan of Merger and Reorganization, dated as of May 19, 2026, which agreement was subsequently amended on July 6, 2026 (as amended, the “Merger Agreement”), by and among InMed, Indigo Merger Sub Corp., a Delaware corporation and wholly owned subsidiary of InMed (“First Merger Sub”), Indigo Merger Sub II, LLC, a Delaware limited liability company and wholly owned subsidiary of InMed (“Second Merger Sub”), and Mentari Therapeutics, Inc., a private Delaware corporation (prior to the Closing Date, unless context otherwise requires, “Mentari”).
Prior to the Closing, on November 4, 2026, following the annual general and special meeting of InMed shareholders, InMed (i) effected a consolidation of its outstanding common shares, no par value (the “InMed Common Shares”), at a ratio of one post-consolidation share for every ten pre-consolidation shares (the “Reverse Stock Split”), (ii) changed its name from “InMed Pharmaceuticals Inc.” to “Mentari Therapeutics, Inc.” (the “Name Change”) and (iii) altered its notice of articles and articles to designate 4,013 of its authorized but undesignated preferred shares as “Series A Non-Voting Preferred Shares,” in each case as previously reported in InMed’s Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on November 5, 2026. On the Closing Date and prior to the Closing, as further described in Item 3.03 of this Current Report on Form 8-K, InMed redomesticated from the Province of British Columbia, Canada to the State of Nevada by way of a continuation out of British Columbia under the Business Corporations Act (British Columbia) (the “BCBCA”) and a domestication in Nevada pursuant to Section 92A.270 of the Nevada Revised Statutes (the “NRS”) (the “Redomestication”). Upon the effectiveness of the Redomestication, each outstanding InMed Common Share was automatically converted into one outstanding share of common stock, par value $0.0001 per share, of the Company (the “Company Common Stock”).
As a result of and upon the effective time of the First Merger (as defined below) (the “First Effective Time”), (i) each then-outstanding share of common stock, par value $0.0001 per share, of Mentari (the “Mentari Common Stock”) and each then-outstanding share of Series A Preferred Stock, par value $0.0001 per share, of Mentari (the “Mentari Series A Preferred Stock”) (including shares of Mentari Common Stock issued in the Mentari Pre-Closing Financing (as defined below) and excluding shares canceled pursuant to the Merger Agreement and dissenting shares) automatically converted solely into the right to receive a number of shares of Company Common Stock equal to the Exchange Ratio (as defined below); (ii) each then-outstanding share of Series Seed Preferred Stock, par value $0.0001 per share, of Mentari (the “Mentari Series Seed Preferred Stock”) (excluding shares of Mentari Series Seed Preferred Stock canceled pursuant to the Merger Agreement and dissenting shares) automatically converted into the right to receive a number of shares of Series A Non-Voting Convertible Preferred Stock, par value $0.0001 per share, of the Company (which are each convertible into 1,000 shares of Company Common Stock, subject to certain beneficial ownership limitations) (the “Company Series A Preferred Stock”), equal to the Exchange Ratio divided by 1,000; (iii) each then-outstanding option to purchase Mentari Common Stock (a “Mentari Option”) was assumed by the Company and converted into an option to purchase shares of Company Common Stock; and (iv) each then-outstanding warrant to purchase shares of Mentari Common Stock (a “Mentari Warrant”), including the pre-funded warrants issued in the Mentari Pre-Closing Financing (each, a “Mentari Pre-Funded Warrant”), was converted into a warrant to purchase shares of Company Common Stock (a “Company Warrant”), in the case of clauses (iii) and (iv), on the same terms and conditions as were applicable immediately prior to the First Effective Time, with the number of underlying shares and the exercise price, as applicable, adjusted in accordance with the Exchange Ratio. Each outstanding share of Mentari restricted common stock was converted into restricted shares of Company Common Stock that remain subject to the same vesting and other terms and conditions as applied immediately prior to the First Effective Time.
Each share of Company Common Stock that was issued and outstanding at the First Effective Time remained issued and outstanding and such shares were unaffected by the Merger. Prior to the First Effective Time, InMed’s board of directors accelerated the vesting of all options to purchase InMed Common Shares (“InMed Options”) in full. At the First Effective Time, each outstanding InMed Option with an exercise price per share equal to or less than the volume weighted average closing trading price of an InMed Common Share on The Nasdaq Stock Market LLC (“Nasdaq”) for the five consecutive trading days ending three trading days prior to the Calculation Date (as defined
in the Merger Agreement), as reported by Bloomberg L.P. (the “InMed Closing Price” and such InMed Options, “In-the-Money InMed Options”), was surrendered to the Company for cancellation and the holder thereof received a number of shares of Company Common Stock equal to the number of shares of Company Common Stock underlying such In-the-Money InMed Option, less a number of shares withheld to satisfy applicable tax withholding obligations. Each InMed Option with an exercise price greater than the InMed Closing Price was cancelled for no consideration.
No fractional shares of Company Common Stock or Company Series A Preferred Stock were issued in connection with the Merger, and no certificates or scrip for any such fractional shares were issued. Any holder of Mentari capital stock who would otherwise have been entitled to receive a fraction of a share of Company Common Stock or Company Series A Preferred Stock instead received (i) one share of Company Common Stock or Company Series A Preferred Stock, as applicable, if the aggregate amount of fractional shares such holder would otherwise have been entitled to was equal to or exceeded 0.50 or (ii) no shares of Company Common Stock or Company Series A Preferred Stock, as applicable, if the aggregate amount of fractional shares such holder would otherwise have been entitled to was less than 0.50, with no cash being paid for any fractional share eliminated by such rounding. Any fractional shares of Company Series A Preferred Stock that a holder of Mentari preferred stock would otherwise have been entitled to receive were aggregated with all fractional shares of Company Series A Preferred Stock issuable to such holder and rounded up to the nearest whole share of Company Series A Preferred Stock.
The Exchange Ratio was calculated using a formula intended to allocate existing InMed and Mentari securityholders a percentage of the Company. Based on InMed’s and Mentari’s capitalization as of November 6, 2026, the Exchange Ratio (as adjusted for the Reverse Stock Split) was 0.20065 shares of Company Common Stock for each share of Mentari Common Stock and Mentari Series A Preferred Stock (and 0.00020065 shares of Company Series A Preferred Stock for each share of Mentari Series Seed Preferred Stock).
After giving effect to the Mentari Pre-Closing Financing, immediately following the completion of the Merger, InMed securityholders owned approximately 1.0% of the capital stock of the Company post-Merger on a fully diluted basis, and Mentari securityholders, including holders of shares of Mentari Common Stock and Mentari Pre-Funded Warrants purchased in the Mentari Pre-Closing Financing, owned approximately 99.0% of the capital stock of the Company post-Merger on a fully diluted basis.
On November 6, 2026, First Merger Sub merged with and into Mentari, with Mentari continuing as a wholly owned subsidiary of the Company and the surviving corporation of the merger (the “First Merger”), and immediately thereafter, Mentari merged with and into Second Merger Sub, with Second Merger Sub being the surviving entity of the merger (the “Second Merger,” and together with the First Merger, the “Merger”). In connection with the Second Merger, Second Merger Sub changed its corporate name to “Mentari Therapeutics Operating Company LLC.” The Merger is intended to qualify for U.S. federal income tax purposes as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”).
The material provisions of the Merger Agreement are described in InMed’s definitive proxy statement/prospectus and management information circular filed on Form S-4 with the SEC, which registration statement (File No. 333-297234) was most recently amended on September 29, 2026 and declared effective on October 1, 2026 (the “Proxy Statement/Prospectus”), in the section entitled “The Merger Agreement” beginning on page 196 and are incorporated herein by reference.
The foregoing description of the Merger Agreement is not complete and is subject to and qualified in its entirety by reference to the complete text of the Merger Agreement, copies of which are attached hereto as Exhibits 2.1 and 2.2 and incorporated herein by reference.
Support and Lock-Up Agreements
Concurrently with the execution of the Merger Agreement, (a) certain Mentari stockholders (solely in their respective capacities as Mentari stockholders) holding approximately 49.8% of the outstanding shares of Mentari capital stock entered into support agreements with InMed and Mentari to vote all of their shares of Mentari capital stock in favor of the adoption and approval of the Merger Agreement and the transactions contemplated thereby and against any alternative acquisition proposals (the “Mentari Support Agreements”) and (b) the directors and certain
officers of InMed holding approximately 1% of the outstanding InMed Common Shares as of September 25, 2026 entered into support agreements with InMed and Mentari to vote all of their InMed Common Shares in favor of the adoption and approval of the Merger Agreement and the transactions contemplated thereby and against any alternative acquisition proposals (the “InMed Support Agreements,” and together with the Mentari Support Agreements, the “Support Agreements”).
Certain of Mentari’s executive officers, directors and stockholders entered into lock-up agreements (the “Lock-Up Agreements”), pursuant to which such parties have agreed not to, except in limited circumstances, 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 Company Common Stock or any securities convertible into or exercisable or exchangeable for Company Common Stock, currently or thereafter owned, but excluding, as applicable, shares purchased by existing Mentari stockholders in the Mentari Pre-Closing Financing (including any shares issuable upon exercise of pre-funded warrants), until 180 days after the First Effective Time.
Descriptions of the Support Agreements and the Lock-Up Agreements are included in the Proxy Statement/Prospectus in the sections entitled “Agreements Related to the Merger—Support Agreements” and “Agreements Related to the Merger—Lock-Up Agreements” beginning on page 219 and are incorporated herein by reference.
The foregoing descriptions of the Support Agreements and the Lock-Up Agreements are not complete and are subject to and qualified in their entirety by reference to the complete texts of the Form of InMed Support Agreement, the Form of Mentari Support Agreement and the Form of Lock-Up Agreement, copies of which are attached hereto as Exhibits 10.1, 10.2 and 10.3, respectively, and are incorporated herein by reference.
Financing Transaction
In connection with the Merger, Mentari entered into a securities purchase agreement, dated as of May 19, 2026, which agreement was subsequently amended on July 22, 2026 (as amended, the “Securities Purchase Agreement”), with certain institutional and accredited investors (the “Financing Investors”), pursuant to which such investors purchased, immediately prior to the First Merger, 215,042,178 shares of Mentari Common Stock and 7,317,328 Mentari Pre-Funded Warrants (the “PIPE Securities”), for an aggregate purchase price of approximately $490.0 million, which includes $52.7 million of principal and accrued interest under convertible notes previously issued by Mentari (the “Convertible Notes”), which were contributed as consideration in the financing (the “Mentari Pre-Closing Financing”). Under the Securities Purchase Agreement, with respect to the original $290.0 million commitment amount, the number of shares of Mentari Common Stock or Mentari Pre-Funded Warrants, as applicable, was determined at a purchase price per share or warrant equal to (i) a valuation for Mentari equal to $125.0 million, divided by (ii) the number of fully diluted shares of Mentari Common Stock outstanding immediately prior to the First Effective Time (excluding the securities being issued under the Securities Purchase Agreement), and with respect to the additional $200.0 million commitment amount, the purchase price per share or warrant was equal to 152.8% of such price.
The Mentari Pre-Funded Warrants have an exercise price per share equal to $0.0001 (as adjusted from time to time as provided in the form of Mentari Pre-Funded Warrant) and may be exercised at any time and from time to time after the original issue date. The Mentari Pre-Funded Warrants do not expire. A holder may not exercise any portion of a Mentari Pre-Funded Warrant to the extent that, immediately prior to or after giving effect to such exercise, the holder, together with its attribution parties, would beneficially own shares of common stock in excess of 19.99% of the shares of common stock outstanding immediately following such exercise. A holder may, upon written notice to the Company, increase or decrease such percentage to any other percentage not in excess of 19.99%, provided that any increase will not be effective until the sixty-first (61st) day after such notice is delivered to the Company.
The shares of Mentari Common Stock and Mentari Pre-Funded Warrants that were issued in the Mentari Pre-Closing Financing were or have the right to be, respectively, converted into shares of Company Common Stock in the Merger.
The Securities Purchase Agreement contains customary representations and warranties of Mentari and also contains customary representations and warranties of the purchaser parties thereto.
A description of the Securities Purchase Agreement is included in the Proxy Statement/Prospectus in the section entitled “Agreements Related to the Merger—Securities Purchase Agreement” beginning on page 219 and is incorporated herein by reference.
The foregoing descriptions of the Securities Purchase Agreement and the Form of Mentari Pre-Funded Warrant are not complete and are subject to and qualified in their entirety by reference to the complete texts of the Securities Purchase Agreement, Amendment No. 1 thereto and the Form of Mentari Pre-Funded Warrant, respectively, copies of which are attached hereto as Exhibits 10.4, 10.5 and 4.1, respectively, and are incorporated herein by reference.
Registration Rights Agreement
In connection with the closing of the Mentari Pre-Closing Financing, on November 6, 2026, Mentari entered into a registration rights agreement with the Financing Investors (the “Registration Rights Agreement”), which, by its terms, applies to the Company following the First Effective Time. Pursuant to the Registration Rights Agreement, the Company agreed to file a registration statement covering the resale of the shares of Company Common Stock held by the Financing Investors, including the shares of Company Common Stock issuable upon exercise of the Company Pre-Funded Warrants, no later than the 30th calendar day following the Closing Date, and to use commercially reasonable efforts to keep such registration statement continuously effective pursuant to Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), until the earliest of (i) the date on which the Financing Investors have resold all of the registrable securities covered thereby, (ii) the date on which such registrable securities may be resold without registration and without regard to any volume or manner-of-sale limitations under Rule 144 under the Securities Act and without the requirement for the Company to be in compliance with the current public information requirement thereunder and (iii) the fifth anniversary of the date of the Registration Rights Agreement. Because the issuance of the shares of Company Common Stock in the Merger, including the shares issued in exchange for the PIPE Securities and the shares of Company Common Stock issuable upon exercise of the Company Pre-Funded Warrants, was registered under the Securities Act on the Company’s registration statement on Form S-4 (File No. 333-297234), under the terms of the Registration Rights Agreement such shares ceased to be subject to the registration obligation, other than shares held by, or issuable upon exercise of Company Pre-Funded Warrants held by, Financing Investors that are affiliates of the Company. The Company has agreed to bear all registration expenses (other than selling expenses of the Financing Investors) and to indemnify the Financing Investors against certain liabilities, including liabilities under the Securities Act, in connection with any registration statement filed pursuant to the Registration Rights Agreement. The foregoing description of the Registration Rights Agreement is not complete and is subject to and qualified in its entirety by reference to the complete text of the form of Registration Rights Agreement, a copy of which is attached hereto as Exhibit 10.6 and is incorporated herein by reference.
Contingent Value Rights Agreement
On November 6, 2026, following the Name Change and prior to the Redomestication, InMed entered into a contingent value rights agreement (the “CVR Agreement”) with Odyssey Transfer and Trust Company (the “Rights Agent”) and Indigo CVR Services Inc., as representative of the holders of the CVRs, pursuant to which holders of InMed Common Shares as of the close of business on November 5, 2026 (after giving effect to the Reverse Stock Split) are entitled to receive one non-transferable contingent value right (each, a “CVR”) for each outstanding InMed Common Share held by such holder as of such time. The Rights Agent will effect the distribution of the CVRs, less any applicable tax withholding, by mailing to each such holder a statement of holding reflecting such CVRs.
Pursuant to the CVR Agreement, each CVR represents the contractual right to receive a pro rata portion of certain net proceeds, if any, derived from any cash consideration actually received by the Company during the term of the CVRs as a result of the disposition of InMed’s pre-Merger legacy business, which includes InMed’s INM-901, INM-089 and INM-755 (cannabinol) cream programs and the related intellectual property (the “InMed Legacy Business”), net of permitted deductions, which include, among other things, applicable taxes, expenses incurred in performing the CVR Agreement and contracts relating to the InMed Legacy Business (including the costs of
prosecuting, maintaining and enforcing the related intellectual property rights), transaction and enforcement expenses (including fees and expenses of the Rights Agent), indemnification and other third-party claim obligations, royalties payable to third parties and certain other liabilities relating to the InMed Legacy Business. Holders of CVRs will be entitled to receive 100% of such net proceeds where a definitive agreement for the disposition of the InMed Legacy Business is entered into during the first year of the period beginning on May 19, 2026, the date of the Merger Agreement, and ending on the second (2nd) anniversary of the First Effective Time (the “Legacy Transaction Period”), and 90% of such net proceeds where such agreement is entered into during the second year of the Legacy Transaction Period. The term of the CVRs begins at the First Effective Time and ends on the second (2nd) anniversary of the date of the CVR Agreement, and will be automatically extended until the fifteenth (15th) anniversary of the date of the CVR Agreement if such a definitive agreement is entered into during the Legacy Transaction Period.
During the Legacy Transaction Period, the Company will expend up to $100,000 for costs and expenses associated with the retention of an employee or consultant of InMed for the purpose of business development efforts related to the InMed Legacy Business. At the end of the Legacy Transaction Period, the amount, if any, by which $100,000 exceeds the aggregate amount of such costs and expenses will constitute net proceeds under the CVR Agreement.
The Company has agreed to act in good faith to complete a disposition of the InMed Legacy Business, including to use commercially reasonable efforts during the Legacy Transaction Period to maintain the intellectual property (including patents) of the InMed Legacy Business in existence on or prior to the First Effective Time, and not to take, or fail to take, any action with the primary purpose (and not merely the effect) of avoiding, or intending to prevent or materially delay, the entry into a definitive agreement for the disposition of the InMed Legacy Business during the Legacy Transaction Period or the receipt of proceeds or the payment of CVR proceeds during the term of the CVRs. Following the Legacy Transaction Period, the Company will not be required to use any efforts to pursue a disposition of the InMed Legacy Business.
The contingent payments under the CVR Agreement, if they become payable, will become payable to the Rights Agent for subsequent distribution to the CVR holders, calculated on a pro rata basis according to the number of CVRs held by each holder. Any such payment will be made no later than 30 days following the Company’s receipt of the applicable proceeds, subject to the aggregation of smaller payments as provided in the CVR Agreement. In the event that no such proceeds are received, holders of the CVRs will not receive any payment pursuant to the CVR Agreement. There can be no assurance that any CVR holders will receive payments with respect thereto.
The right to the contingent payments contemplated by the CVR Agreement is a contractual right only and is not transferable, except in the limited circumstances specified in the CVR Agreement. The CVRs are not evidenced by a certificate or any other instrument and are not registered with the SEC. The CVRs do not have any voting or dividend rights and do not represent any equity or ownership interest in the Company or any of its affiliates. No interest will accrue on any amounts payable in respect of the CVRs.
The foregoing description of the CVR Agreement does not purport to be complete and is qualified in its entirety by the full text of the CVR Agreement, a copy of which is attached hereto as Exhibit 10.7 and is incorporated herein by reference.
Item 1.01 Entry into a Material Definitive Agreement.
The information set forth under the headings “Contingent Value Rights Agreement” and “Registration Rights Agreement” in the Introductory Note of this Current Report on Form 8-K is incorporated by reference into this Item 1.01.
Indemnification Agreements
On November 6, 2026, the Company entered into indemnification agreements with each of its directors and executive officers (collectively, the “Indemnitees,” and such agreements, the “Indemnification Agreements”), which replaced and superseded any previous indemnification agreements between the Company and each such individual. The Indemnification Agreements provide for certain indemnification and advancement of expenses by the Company in connection with actions or proceedings arising out of the Indemnitees’ service as directors or officers of the Company or service to other entities at the Company’s request, on the terms and subject to the conditions set forth therein.
The foregoing description of the Indemnification Agreements is not complete and is subject to and qualified in its entirety by reference to the complete text of the Indemnification Agreements, the form of which is attached hereto as Exhibit 10.8 and incorporated herein by reference.
Item 2.01 Completion of Acquisition or Disposition of Assets.
The disclosure set forth in the “Introductory Note” above, including with respect to the Merger, is incorporated into this Item 2.01 by reference.
All of the proposals included in the Proxy Statement/Prospectus were approved by InMed shareholders at the annual general and special meeting of InMed shareholders held on November 4, 2026 (the “InMed Shareholders Meeting”), other than the proposal to adjourn the InMed Shareholders Meeting, which was not presented to the shareholders.
In connection with the consummation of the Merger, on the Closing Date:
| • | Mentari issued to the Financing Investors (prior to giving effect to the Exchange Ratio) an aggregate of 215,042,178 shares of Mentari Common Stock and Mentari Pre-Funded Warrants to purchase 7,317,328 shares of Mentari Common Stock for an aggregate purchase price of approximately $490.0 million (including the contribution of the Convertible Notes and accrued interest thereon); and |
| • | all of the then-outstanding (a) (i) 5,305,556 shares of Mentari Common Stock, (ii) 40,078,698 shares of Mentari Series A Preferred Stock, and (iii) 215,042,178 shares of Mentari Common Stock purchased in the Mentari Pre-Closing Financing were automatically converted into the right to receive a number of shares of Company Common Stock equal to the exchange ratio calculated in accordance with the Merger Agreement (the “Exchange Ratio”); (b) 20,000,000 shares of Mentari Series Seed Preferred Stock were automatically converted into the right to receive a number of shares of Company Series A Preferred Stock equal to the Exchange Ratio divided by 1,000; and (c)(i) Mentari Warrants to purchase 7,971,170 shares of Mentari Common Stock (including Mentari Pre-Funded Warrants to purchase 7,317,328 shares of Mentari Common Stock purchased in the Mentari Pre-Closing Financing) were automatically converted into Company Warrants to purchase shares of Company Common Stock, and (ii) Mentari Options exercisable for 11,773,692 shares of Mentari Common Stock were assumed by the Company and became options in respect of shares of Company Common Stock, in the case of clauses (i) and (ii), with the number of underlying shares and the exercise price, as applicable, adjusted in accordance with the Exchange Ratio. |
Immediately following the application of the Exchange Ratio (which was adjusted to give effect to the Reverse Stock Split), and following the consummation of the transactions contemplated by the Merger Agreement, the Company had 58,295,136 shares of Company Common Stock (assuming the exercise in full of all Company Pre-Funded Warrants (as defined below) and the conversion of all Company Series A Preferred Stock, but excluding outstanding options, Company Warrants other than the Company Pre-Funded Warrants and outstanding InMed warrants), which is comprised of:
| • | 52,813,914 shares of Company Common Stock (inclusive of issuances pursuant to the Merger Agreement and the Mentari Pre-Closing Financing); |
| • | 1,468,222 shares of Company Common Stock issuable upon the exercise of the Company Warrants issued in respect of the Mentari Pre-Funded Warrants, each exercisable for one share of Company Common Stock at a price of $0.0001 per share (the “Company Pre-Funded Warrants”); and |
| • | 4,013,000 shares of Company Common Stock issuable upon the conversion of 4,013 shares of Company Series A Preferred Stock. |
The Company Common Stock commenced trading on a post-Merger basis on Nasdaq under the ticker symbol “MTRI” at the open of trading on November 9, 2026, under the new CUSIP number 587157108.
FORM 10 INFORMATION
Item 2.01(f) of Form 8-K states that if the predecessor registrant was a “shell company” (as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as InMed was immediately before the Merger, then the registrant must disclose the information that would be required if the registrant were filing a general form for registration of securities on Form 10. Accordingly, the Company is providing the information below that would be included in a Form 10 if the Company were to file a Form 10. Please note that the information provided below relates to the Company as the combined company after the consummation of the Merger, unless otherwise specifically indicated or the context otherwise requires.
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, including statements regarding the anticipated benefits of the Merger and the financial condition, results of operations, and prospects of the Company. Any express or implied statements that do not relate to historical or current facts or matters are forward-looking statements. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. These forward-looking statements include, but are not limited to, express or implied statements regarding the Company’s expectations, hopes, beliefs, intentions or strategies regarding the future. In some cases, you can identify forward-looking statements by terminology such as “may,” “might,” “will,” “could,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “seeks,” “target,” “endeavor,” “possible,” “potential,” “continue,” “contemplate” or the negative of these terms or other comparable terminology, but the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are based on current expectations and beliefs concerning future developments and their potential effects. There can be no assurance that future developments affecting the Company will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the Company’s control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. In addition to other factors and matters contained in or incorporated by reference in this document, the Company believes the following factors could cause actual results to differ materially from those discussed in the forward-looking statements:
| • | expectations regarding the strategies, prospects, plans, expectations and objectives of management of the Company for future operations of the Company; |
| • | the ability of the Company to recognize the benefits that may be derived from the Merger, including the commercial or market opportunity of the product candidates of the Company; |
| • | the possibility that the CVR holders may never receive any proceeds pursuant to the CVR Agreement; |
| • | the accuracy of the Company’s estimates regarding expenses, future revenue, capital requirements and needs for additional financing; |
| • | the outcome of any legal proceedings that may be instituted against the Company or any of its directors or officers related to the Merger Agreement or the transactions contemplated thereby; |
| • | the ability of the Company to protect its intellectual property rights; |
| • | competitive responses to the Merger; |
| • | legislative, regulatory, political and economic developments beyond the Company’s control; |
| • | the initiation, timing and success of clinical trials for the Company’s product candidates; |
| • | success in retaining, or changes required in, the Company’s officers, key employees or directors; |
| • | the Company’s public securities’ potential liquidity and trading; |
| • | regulatory actions with respect to the Company’s product candidates or its competitors’ products and product candidates; |
| • | the Company’s ability to manufacture its product candidates in conformity with the FDA’s requirements and to scale up manufacturing of its product candidates to commercial scale, if approved; |
| • | uncertainties regarding the capabilities and potential of the Company’s pipeline programs, including MT-001 and MT-002; |
| • | the Company’s reliance on Paragon Therapeutics, Inc., Paragon Laboratories, Inc. and other third parties, including third-party contract development and manufacturer organizations to manufacture and supply product candidates; |
| • | the beneficial characteristics, and the potential safety, efficacy and therapeutic effects of the Company’s product candidates; |
| • | the expected potential benefits of strategic collaboration with third parties and the Company’s ability to attract collaborators with development, regulatory and commercialization expertise; |
| • | the Company’s ability to successfully commercialize product candidates, if approved, and the rate and degree of market acceptance of such product candidates; and |
| • | developments and projections relating to the Company’s competitors or industry. |
The foregoing review of important factors that could cause actual events to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere, including the risk factors included in the “Risk Factors” section of this Current Report on Form 8-K and other documents to be filed by the Company from time to time with the SEC, discussions of potential risks, uncertainties, and other important factors in the Company’s subsequent filings with the SEC, and risk factors associated with companies, such as the Company, that operate in the biopharma industry.
If any of these risks or uncertainties materialize or any of these assumptions prove incorrect, the results of the Company could differ materially from the forward-looking statements. Any public statements or disclosures by the Company following this Current Report on Form 8-K that modify or impact any of the forward-looking statements contained in this Current Report on Form 8-K will be deemed to modify or supersede such statements in this Current Report on Form 8-K. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document and are qualified in their entirety by reference to the cautionary statements herein. The Company does not intend, and undertakes no obligation, to update any forward-looking information to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events, unless required by law to do so.
Business and Facilities
The information set forth in the section of the Proxy Statement/Prospectus entitled “Mentari’s Business” beginning on page 335 is incorporated herein by reference.
Risk Factors
The risks associated with Mentari’s business and operations are described in the Proxy Statement/Prospectus in the section entitled “Risk Factors—Risks Related to Mentari” beginning on page 84, the risks associated with the Redomestication are described in the Proxy Statement/Prospectus in the section entitled “Risk Factors—Risks Related to the Redomestication” beginning on page 122 and the risks associated with the business and operations of the Company are described in the Proxy Statement/Prospectus in the section entitled “Risk Factors—Risks Related to the Combined Company” beginning on page 124, each of which is incorporated herein by reference.
Financial Information
Unaudited Financial Statements
The unaudited condensed consolidated financial statements of Mentari as of June 30, 2026 and for the three and six months ended June 30, 2026 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-55 and are incorporated herein by reference.
The unaudited interim condensed consolidated financial statements of InMed as of and for the three months ended September 30, 2026 and the related notes thereto are included in InMed’s Quarterly Report on Form 10-Q for the period ended September 30, 2026, filed with the SEC on November 3, 2026, and are incorporated herein by reference.
Audited Financial Statements
The audited financial statements of Mentari as of December 31, 2025 and for the period from June 13, 2025 (inception) to December 31, 2025 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-29 and are incorporated herein by reference.
The audited consolidated financial statements of InMed as of and for the fiscal years ended June 30, 2026 and 2025 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-2 and are incorporated herein by reference.
Unaudited Pro Forma Condensed Combined Financial Information
The unaudited pro forma condensed combined financial information of InMed and Mentari as of and for the six months ended June 30, 2026 and the year ended December 31, 2025 and the related notes thereto are attached hereto as Exhibit 99.1 and are incorporated herein by reference.
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Mentari’s Management’s Discussion and Analysis of Financial Condition and Results of Operations as of and for the period from June 13, 2025 (inception) to December 31, 2025 and as of and for the six months ended June 30, 2026 is included in the Proxy Statement/Prospectus beginning on page 400 and is incorporated herein by reference.
InMed’s Management’s Discussion and Analysis of Financial Condition and Results of Operations as of and for the three months ended September 30, 2026 is included in InMed’s Quarterly Report on Form 10-Q for the period ended September 30, 2026, filed with the SEC on November 3, 2026, and is incorporated herein by reference.
Additional information regarding management’s discussion and analysis of the financial condition and results of operations of InMed prior to the Merger is included in the Proxy Statement/Prospectus in the section entitled “InMed’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page 387, which is incorporated herein by reference.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information known to the Company regarding beneficial ownership of shares of Company Common Stock as of November 6, 2026 by:
| • | each person or group of affiliated persons, who is known by the Company to be the beneficial owner of more than 5% of Company Common Stock; |
| • | each of the Company’s directors; |
| • | each of the Company’s named executive officers; and |
| • | all of the Company’s current directors and executive officers as a group. |
The column entitled “Percentage of Shares Outstanding Beneficially Owned” is based on a total of 52,813,914 shares of Company Common Stock outstanding as of November 6, 2026, after giving effect to the Reverse Stock Split that was effected on November 4, 2026 and the Merger.
Beneficial ownership is determined in accordance with the rules and regulations of the SEC and includes voting or investment power with respect to Company Common Stock. Shares of Company Common Stock subject to options that are currently exercisable or exercisable within 60 days of November 6, 2026 are considered outstanding and beneficially owned by the person holding the options for the purpose of calculating the percentage ownership of that person but not for the purpose of calculating the percentage ownership of any other person. Except as otherwise noted, the persons and entities in this table have sole voting and investing power with respect to all of the shares of Company Common Stock beneficially owned by them, subject to community property laws, where applicable. Unless otherwise indicated, the address for each beneficial owner is c/o Mentari Therapeutics, Inc., 221 Crescent Street, Building 23, Suite 105, Waltham, MA 02453.
| Name of Beneficial Owner | Number of Shares Beneficially Owned |
Percentage of Shares Outstanding Beneficially Owned |
||||||
| 5% or Greater Stockholders |
||||||||
| Entities affiliated with Fairmount Funds Management LLC(1) |
10,555,507 | 19.99 | % | |||||
| FMR LLC(2) |
6,707,270 | 12.70 | % | |||||
| Commodore Capital Master LP(3) |
2,977,630 | 5.64 | % | |||||
| Entities affiliated with Deep Track Capital, LP(4) |
2,977,478 | 5.64 | % | |||||
| Entities affiliated with Janus Henderson Investors(5) |
2,850,397 | 5.40 | % | |||||
| Directors and Named Executive Officers |
||||||||
| Julianne Bruno(6) |
33,442 | * | ||||||
| Gregory Divis |
— | * | ||||||
| Michelle Pernice(7) |
27,868 | * | ||||||
| Laura Sandler |
— | * | ||||||
| Todd Shegog |
— | * | ||||||
| Brett Hagen |
— | * | ||||||
| Jerad Seurer |
— | * | ||||||
| All current executive officers and directors as a group (7 persons)(8) |
61,310 | * | ||||||
| * | Less than 1%. |
| (1) | Consists of 10,555,507 shares of Company Common Stock held directly by Fairmount Healthcare Fund II, L.P. (“Fairmount Fund II”). Excludes (i) 1,468,222 shares of Company Common Stock issuable upon the exercise of Company Pre-Funded Warrants held by Fairmount Fund II and (ii) 4,013,000 shares of Company Common Stock issuable upon the conversion of 4,013 shares of Company Series A Preferred Stock held by Fairmount Fund II. The Company Pre-Funded Warrants are subject to a beneficial ownership limitation of 19.99% and the shares of Company Series A Preferred Stock are subject to a beneficial ownership limitation of 19.99%, which such limitations restrict Fairmount Funds Management LLC (“Fairmount”) and its affiliates from exercising that portion of the warrants and converting those shares of preferred stock that would result in Fairmount and its affiliates owning, after exercise or conversion, a number of shares of Company Common Stock in excess of the applicable ownership limitation. At such time as Fairmount and its affiliates beneficially own 9.0% or less of the shares of Company Common Stock, the beneficial ownership limitation applicable to the shares of Company Series A Preferred Stock will automatically reduce to 9.99%. Fairmount serves as investment manager for Fairmount Fund II. Fairmount Fund II has delegated to Fairmount the sole power to vote and the sole power to dispose of all securities held in Fairmount Fund II’s portfolio. Because Fairmount Fund II has divested itself of voting and investment power over the securities it holds and may not revoke that delegation on less than 61 days’ notice, Fairmount Fund II disclaims beneficial ownership of the securities it holds. As managers of Fairmount, Peter Harwin and Tomas Kiselak may be deemed to have voting and investment power over the shares held by Fairmount Fund II. Fairmount, Peter Harwin and Tomas Kiselak disclaim beneficial ownership of such shares, except to the extent of any pecuniary interest therein. The address of the entities and individuals listed is 200 Barr Harbor Drive, Suite 400, West Conshohocken, PA 19428. |
| (2) | These shares are owned by funds or accounts managed by direct or indirect subsidiaries of FMR LLC, all of which shares are beneficially owned, or may be deemed to be beneficially owned, by FMR LLC, certain of its subsidiaries and affiliates, and other companies. Abigail P. Johnson is a Director, the Chairman, and the Chief Executive Officer of FMR LLC. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC, representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. The address of FMR LLC is 245 Summer Street, Boston, Massachusetts 02110. |
| (3) | Consists of 2,977,630 shares of Company Common Stock held by Commodore Capital Master LP (“Commodore Master”). Commodore Capital LP (the “Firm”) serves as investment manager to Commodore Master and, in such capacity, may be deemed to beneficially own the shares held by Commodore Master. Michael Kramarz and Robert Egen Atkinson, as the managing partners of the Firm, exercise investment discretion with respect to such shares. Each of the Firm, Dr. Kramarz, and Dr. Atkinson disclaims beneficial ownership of such shares except to the extent of any pecuniary interest therein. The address of the entities and individuals listed is 444 Madison Avenue, Floor 35, New York, New York 10022. |
| (4) | Consists of (i) 2,214,135 shares of Company Common Stock held by Deep Track Biotechnology Master Fund, Ltd., a Cayman Islands exempted company (“Deep Track Master Fund”), and (ii) 763,343 shares of Company Common Stock held by Deep Track Special Opportunities Fund, LP, a Delaware limited partnership (“Deep Track Special Opportunities” and, together with Deep Track Master Fund, the “Deep Track Funds”). Deep Track Capital GP, LLC, a Delaware limited liability company, is the general partner of Deep Track Capital, LP (“Deep Track Capital”), a Delaware limited partnership. Deep Track Capital serves as investment manager to each of the Deep Track Funds and, in such capacity, may be deemed to have sole power to vote and to dispose of all shares held by the Deep Track Funds. David Kroin, as the managing member of the general partner, may be deemed to have voting and investment power over the shares beneficially owned by Deep Track Capital. Each of Deep Track Capital and David Kroin disclaims beneficial ownership of such shares except to the extent of any pecuniary interest therein. The address of the entities and individuals listed is c/o Deep Track Capital, LP, 200 Greenwich Avenue, Greenwich, Connecticut 06830. |
| (5) | Consists of (i) 2,330,091 shares of Company Common Stock held by Janus Henderson Biotech Innovation Master Fund Limited (“Janus Master Fund”) and (ii) 520,306 shares of Company Common Stock held by Janus Henderson Biotech Innovation Master Fund II Limited (“Janus Master Fund II” and, together with Janus Master Fund, the “Janus Funds”). Such shares may be deemed to be beneficially owned by Janus Henderson Investors US LLC (“Janus”), an investment adviser registered under the Investment Advisers Act of 1940, as amended, who acts as investment adviser for each of the Janus Funds and has the ability to make decisions with respect to the voting and disposition of the shares subject to the oversight of the board of directors of each of the Janus Funds. Under the terms of its management contract with each of the Janus Funds, Janus has overall responsibility for directing the investments of the Janus Funds in accordance with the investment objective, policies, and limitations. Each of the Janus Funds has one or more portfolio managers appointed by and serving at the pleasure of Janus who make decisions with respect to the disposition of the shares. The portfolio managers for the Janus Funds are Andrew Acker, Daniel S. Lyons, and Agustin Mohedas. The business address of each of the aforementioned parties is c/o Janus Henderson Investors US LLC, 151 Detroit Street, Denver, Colorado 80206. |
| (6) | Consists of 33,442 shares of restricted common stock of the Company issued in exchange for 166,667 shares of Mentari restricted common stock. |
| (7) | Consists of 27,868 shares of restricted common stock of the Company issued in exchange for 138,889 shares of Mentari restricted common stock. |
| (8) | See Notes (6) and (7) above. |
Information about Directors and Executive Officers
The information set forth in Item 5.02 of this Current Report on Form 8-K under the heading “Appointment of Directors and Certain Officers” is incorporated herein by reference.
Director Compensation
The compensation of the directors of Mentari prior to the Closing is set forth in the Proxy Statement/Prospectus in the section entitled “Mentari Director Compensation” beginning on page 274 and is incorporated herein by reference.
The compensation of the non-employee directors of InMed prior to the Closing is set forth in the Proxy Statement/Prospectus in the section entitled “InMed Non-Employee Director Compensation” beginning on page 268 and is incorporated herein by reference.
The information set forth in Item 5.02 of this Current Report on Form 8-K under the heading “Non-Employee Director Compensation Program” is incorporated herein by reference.
Executive Compensation
The compensation of the named executive officers of Mentari prior to the Closing is set forth in the Proxy Statement/Prospectus in the section entitled “Mentari Executive Compensation” beginning on page 271 and is incorporated herein by reference.
The compensation of the named executive officers of InMed prior to the Closing is set forth in the Proxy Statement/Prospectus in the section entitled “InMed Executive Compensation” beginning on page 258 and is incorporated herein by reference.
The information set forth in Item 5.02 of this Current Report on Form 8-K under the headings “Stock Incentive Plan” and “Departure of Directors and Certain Officers” is incorporated herein by reference.
The information set forth in the section of the Proxy Statement/Prospectus entitled “Management Following the Merger—Board Committees—Compensation Committee” beginning on page 424 is incorporated herein by reference.
Certain Relationships and Related Party Transactions
The information set forth in the section of the Proxy Statement/Prospectus entitled “Certain Relationships and Related Party Transactions of the Combined Company” beginning on page 426 is incorporated herein by reference.
Director Independence
Nasdaq listing rules have objective tests and a subjective test for determining who is an “independent director.” The subjective test states that an independent director must be a person who lacks a relationship that, in the opinion of the board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. Subject to specified exceptions, each member of a listed company’s audit, compensation and nominating committees must be independent, and audit and compensation committee members must satisfy additional independence criteria.
The newly constituted board of directors of the Company (the “Board”) has determined that each of Julianne Bruno, Michelle Pernice, Laura Sandler and Todd Shegog, each of whom is a current member of the Board, qualifies as an “independent director” as defined under the Nasdaq listing rules. Gregory Divis, the Company’s President and Chief Executive Officer, does not qualify as an independent director. In making these determinations, the Board considered the current and prior relationships that each director has with InMed and Mentari and all other facts and circumstances that the Board deemed relevant in determining the independence of each director, including the interests of each director in the Merger, any relevant related party transactions and the beneficial ownership of securities of InMed, Mentari or the Company by each director.
The Board has also determined that each member of the Audit Committee of the Board (the “Audit Committee”), the Compensation Committee of the Board (the “Compensation Committee”) and the Nominating and Corporate Governance Committee of the Board (the “Nominating and Corporate Governance Committee”) is independent and satisfies the relevant independence requirements for such committees under the Nasdaq listing rules and the Exchange Act and that each member of the Compensation Committee is a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act.
The information set forth in Item 5.02 of this Current Report on Form 8-K under the heading “Committees of the Board of Directors” is incorporated herein by reference.
Legal Proceedings
The information set forth in the section of the Proxy Statement/Prospectus entitled “Mentari’s Business—Legal Proceedings” on page 385 is incorporated herein by reference.
Market Price of and Dividends on the Registrant’s Common Equity and Related Stockholder Matters
InMed Common Shares were historically listed on The Nasdaq Capital Market under the symbol “INM.” On November 9, 2026, shares of Company Common Stock began trading on The Nasdaq Capital Market under the symbol “MTRI.”
As of the Closing Date and following the completion of the Merger, and after giving effect to the Reverse Stock Split effected on November 4, 2026, the Company had approximately 52,813,914 shares of Company Common Stock issued and outstanding held of record by approximately 135 holders. The number of holders of record does not include a substantially greater number of “street name” holders or beneficial holders whose shares of Company Common Stock are held of record by banks, brokers and other financial institutions.
The information set forth in the section of the Proxy Statement/Prospectus entitled “Market Price and Dividend Information—Dividends” on page 32 is incorporated herein by reference.
Description of Registrant’s Securities
The information set forth in the Proxy Statement/Prospectus in the sections entitled “Proposal No. 3—The Redomestication Proposal—Effects of the Nevada Redomestication” beginning on page 280 and “Description of InMed Shares—InMed Series A Preferred Shares” beginning on page 450, in each case as supplemented by the information set forth in Item 3.03 of this Current Report on Form 8-K, is incorporated herein by reference.
Indemnification of Directors and Officers
The Company’s articles of incorporation (the “Articles”) provide that the liability of the directors and officers of the Company is eliminated or limited to the fullest extent permitted by the NRS. Under the NRS, the Company’s directors and officers will not be personally liable to the Company or its stockholders or creditors for any damages for breach of fiduciary duty as a director or an officer as a result of any act or failure to act in their capacity as a director or officer, unless the presumption of Nevada’s codified business judgment rule has been rebutted and it is proven that the director’s or officer’s act or failure to act constituted a breach of their fiduciary duties as a director or officer, and that the breach of those duties involved intentional misconduct, fraud or a knowing violation of law. The Company’s bylaws (the “Bylaws”) provide that the Company shall indemnify and advance expenses to its directors and executive officers and may indemnify and advance expenses to its employees or other agents, to the fullest extent authorized or permitted by applicable law. The Bylaws also provide that the Company may maintain insurance to protect a director or an officer against liability.
The foregoing descriptions of the Articles and the Bylaws do not purport to be complete and are subject to and qualified in their entirety by reference to the full text of the Articles and the Bylaws, copies of which are attached hereto as Exhibits 3.2 and 3.4, respectively, and are incorporated herein by reference.
The Company obtained insurance that covers certain liabilities of its directors and officers, effective as of November 6, 2026.
The information set forth in Item 1.01 of this Current Report on Form 8-K under the heading “Indemnification Agreements” is incorporated herein by reference.
The information set forth in the section of the Proxy Statement/Prospectus entitled “The Merger Agreement—Indemnification and Insurance for Directors and Officers” beginning on page 213 is incorporated herein by reference.
Financial Information and Supplementary Data
The information set forth under Item 9.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 2.02 Results of Operations and Financial Condition.
The unaudited condensed consolidated financial statements of Mentari as of June 30, 2026 and for the three and six months ended June 30, 2026 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-55 and are incorporated herein by reference.
The information set forth in the Proxy Statement/Prospectus in the section entitled “Mentari’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” beginning on page 400, which includes Mentari’s results of operations for the three and six months ended June 30, 2026, is incorporated herein by reference.
The unaudited pro forma condensed combined financial information of InMed and Mentari as of and for the six months ended June 30, 2026 and the year ended December 31, 2025 and the related notes thereto are attached hereto as Exhibit 99.1 and are incorporated herein by reference.
Item 3.02 Unregistered Sales of Equity Securities.
To the extent required by this Item, the information included in Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference. The PIPE Securities were offered and sold in transactions exempt from registration under the Securities Act in reliance on Section 4(a)(2) thereof. Each of the investors represented that it was an “accredited investor,” as defined in Regulation D, and acquired the PIPE Securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. Neither this Current Report on Form 8-K nor any of the exhibits attached hereto is an offer to sell or the solicitation of an offer to buy the PIPE Securities or any other securities of the Company or Mentari.
Item 3.03 Material Modification to Rights of Security Holders.
As previously reported in Item 5.03 of InMed’s Current Report on Form 8-K filed with the SEC on November 5, 2026, on November 4, 2026, InMed effected the Reverse Stock Split and the Name Change and designated 4,013 of its authorized but undesignated preferred shares as “Series A Non-Voting Preferred Shares,” and such information is incorporated herein by reference.
Redomestication
On October 15, 2026, the Registrar of Companies (British Columbia) authorized InMed to continue out of British Columbia to the jurisdiction of Nevada pursuant to Section 308 of the BCBCA. At the InMed Shareholders Meeting, InMed’s shareholders approved, by special resolution, the Redomestication, including the continuation application, the articles of domestication (the “Articles of Domestication”), the Articles and the Bylaws, as described in the Proxy Statement/Prospectus. On the Closing Date, InMed filed the Articles of Domestication and the Articles with the Secretary of State of the State of Nevada, and the Redomestication became effective at 8:40 a.m. Pacific Time on November 6, 2026, prior to the First Effective Time. In connection with the Redomestication, the Bylaws became effective and the Company filed a certificate of designation with the Secretary of State of the State of Nevada designating the Company Series A Preferred Stock (the “Certificate of Designation”).
Upon the effectiveness of the Redomestication, (i) each outstanding InMed Common Share was automatically converted into one outstanding share of Company Common Stock, (ii) each outstanding option or right to acquire InMed Common Shares continued in existence in the form of, and automatically became, an option or right to acquire an equal number of shares of Company Common Stock on the same terms and conditions and (iii) the Company ceased to be governed by the BCBCA and InMed’s articles and became governed by the NRS, the Articles (including the Certificate of Designation) and the Bylaws. The Redomestication did not result in any change in the business, management, assets or liabilities of InMed (other than as a result of the costs related to the Redomestication), and stockholders were not required to exchange their existing share certificates. The Redomestication is intended to qualify as a “reorganization” within the meaning of Section 368(a)(1)(F) of the Code.
The Articles authorize the Company to issue 510,000,000 shares of capital stock, consisting of 500,000,000 shares of Company Common Stock and 10,000,000 shares of preferred stock, par value $0.0001 per share, of which 4,013 shares have been designated as Company Series A Preferred Stock. Among other things, the Articles and the Bylaws (i) provide for a classified Board divided into three classes, with directors serving staggered three-year terms, (ii) provide that directors may be removed only for cause by the affirmative vote of the holders of not less than two-thirds of the voting power of the outstanding shares entitled to vote in an election of directors, subject to the rights of the holders of any series of preferred stock, (iii) provide that vacancies on the Board may be filled only by the remaining directors, (iv) authorize the Board to issue preferred stock in one or more series without further stockholder approval, (v) prohibit stockholder action by written consent, (vi) provide that special meetings of stockholders may be called only by the Board, (vii) require the affirmative vote of the holders of not less than two-thirds of the voting power of the outstanding shares entitled to vote thereon to amend certain provisions of the Articles and, unless the amendment is recommended by the Board, to amend the Bylaws, (viii) provide that internal actions (as defined in the NRS) must be tried before a judge in a court of competent jurisdiction in the State of Nevada, and not before a jury, (ix) provide that the Company elects not to be governed by Sections 78.411 to 78.444, inclusive, of the NRS and (x) designate the Eighth Judicial District Court of Clark County, Nevada as the exclusive forum for internal corporate claims and the federal district courts located in the State of Nevada as the exclusive forum for claims arising under the Securities Act.
Pursuant to the Certificate of Designation, each share of Company Series A Preferred Stock is convertible, at the option of the holder, into 1,000 shares of Company Common Stock, subject to a beneficial ownership limitation that may be set by the holder at any percentage between 0% and 19.99% of the outstanding Company Common Stock. The Company Series A Preferred Stock has no voting rights, except as required by law and except that the consent of the holders of a majority of the outstanding Company Series A Preferred Stock is required for certain actions, including, while at least 30% of the originally issued Company Series A Preferred Stock remains outstanding, certain fundamental transactions, increases in the size of the Board and the retention or replacement of the Company’s independent registered public accounting firm, independent compensation consultant or corporate counsel. At all times when at least 30% of the originally issued shares of Company Series A Preferred Stock remain issued and outstanding, (i) the holders of the Company Series A Preferred Stock, exclusively and voting together as a separate class on an as-converted basis, are entitled to elect two directors (the “Preferred Directors”) and (ii) the holders of Company Common Stock and of any other class or series of voting stock, exclusively and voting together as a single class on an as-converted basis, are entitled to elect the balance of the total number of directors. Each Preferred Director is entitled to three votes on each matter presented to the Board.
A comparison of the rights of holders of InMed Common Shares under the BCBCA and InMed’s articles prior to the Redomestication and the rights of holders of Company Common Stock under the NRS, the Articles and the Bylaws following the Redomestication is included in the Proxy Statement/Prospectus in the sections entitled “Proposal No. 3—The Redomestication Proposal—Effects of the Nevada Redomestication—Comparison of Rights of Holders of the Canadian Corporation Share Capital and the Nevada Corporation Capital Stock” beginning on page 280 and “Proposal No. 3—The Redomestication Proposal—Effects of the Nevada Redomestication—Comparison of Shareholder Rights under British Columbia and Stockholder Rights under Nevada Law” beginning on page 293, which are incorporated herein by reference.
The foregoing descriptions of the Articles of Domestication, the Articles, the Certificate of Designation and the Bylaws do not purport to be complete and are subject to and qualified in their entirety by the full text of the Articles of Domestication, the Articles, the Certificate of Designation and the Bylaws, copies of which are attached hereto as Exhibits 3.1, 3.2, 3.3 and 3.4, respectively, and are incorporated herein by reference.
Item 5.01 Changes in Control of the Registrant.
The information set forth in the “Introductory Note” regarding the Merger above, the information set forth in Item 2.01 of this Current Report on Form 8-K in the section entitled “Security Ownership of Certain Beneficial Owners and Management” and the information set forth in Item 5.02 of this Current Report on Form 8-K regarding the Board and executive officers following the Merger is incorporated herein by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Departure of Directors and Certain Officers
On November 6, 2026, Eric A. Adams, John Bathery, Andrew Hull, Neil Klompas and Nicole Lemerond resigned from the Company’s board of directors and its committees on which they respectively served, which resignations were not the result of any disagreements with the Company relating to the Company’s operations, policies or practices.
In addition, on November 6, 2026, Eric A. Adams, InMed’s President and Chief Executive Officer, Neeta Jagpal, InMed’s Chief Financial Officer and Corporate Secretary, Michael Woudenberg, InMed’s Chief Operating Officer, and Eric Hsu, InMed’s Senior Vice President, Preclinical Research & Development, each resigned as an executive officer of the Company at the Closing. Subject to the terms of their respective employment agreements, each of such officers is eligible to receive the severance benefits and retention bonuses described in the Proxy Statement/Prospectus in the sections entitled “The Merger—Interests of InMed’s Directors and Executive Officers in the Merger” beginning on page 178 and “InMed Executive Compensation” beginning on page 258, which are incorporated herein by reference.
The departures of Mr. Adams, Ms. Jagpal, Mr. Woudenberg and Dr. Hsu were not the result of any disagreement with InMed relating to InMed’s operations, policies or practices.
Stock Incentive Plan
On September 29, 2026, InMed’s board of directors approved the Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (the “2026 Stock Plan”), subject to shareholder approval and the consummation of the Merger. On November 4, 2026, InMed’s shareholders approved the 2026 Stock Plan at the InMed Shareholders Meeting. The purpose of the 2026 Stock Plan is to promote and closely align the interests of employees, officers, non-employee directors and other individual service providers of the Company and its stockholders by providing stock-based compensation and other performance-based compensation. The initial share pool under the 2026 Stock Plan is 9,618,697 shares of Company Common Stock, which represents 16.5% of the total number of shares of outstanding capital stock of the Company immediately following the Closing (including Company Common Stock, Company Series A Preferred Stock on an as-converted basis and unexercised Company Pre-Funded Warrants). The shares of Company Common Stock that may be issued under the 2026 Stock Plan will be automatically increased on January 1 of each year beginning in 2027 and ending with a final increase on January 1, 2036, in an amount equal to 5% of such outstanding capital stock on the preceding December 31, unless a lower (or no) increase is determined by the administrator of the 2026 Stock Plan. Only 50,000,000 shares of Company Common Stock may be issued under the 2026 Stock Plan as incentive stock options. In connection with the effectiveness of the 2026 Stock Plan, no further awards will be granted under InMed’s 2017 Amended and Restated Stock Option Plan, and no further awards will be granted under the Mentari Therapeutics, Inc. 2025 Equity Incentive Plan, which was assumed by the Company in the Merger.
The foregoing description of the 2026 Stock Plan is not complete and is subject to and qualified in its entirety by reference to the complete text of the 2026 Stock Plan, a copy of which is attached hereto as Exhibit 10.13 and incorporated herein by reference.
Employee Stock Purchase Plan
On September 29, 2026, InMed’s board of directors approved the Mentari Therapeutics, Inc. 2026 Employee Stock Purchase Plan (the “2026 ESPP”), subject to shareholder approval and the consummation of the Merger. On November 4, 2026, InMed’s shareholders approved the 2026 ESPP at the InMed Shareholders Meeting, and the 2026 ESPP became effective on the Closing Date. The purpose of the 2026 ESPP is to provide employees of the Company and its designated subsidiaries with an opportunity to purchase shares of Company Common Stock through accumulated contributions. The 2026 ESPP, and the rights of participants to make purchases thereunder, is intended to qualify under Section 423 of the Code; however, sub-plans that do not meet the requirements of Section 423 of the Code may be established for the benefit of eligible employees of non-U.S. subsidiaries of the Company.
The initial share pool under the 2026 ESPP is 582,951 shares of Company Common Stock, which represents the lesser of (x) 1,000,000 shares and (y) 1% of the total number of shares of outstanding capital stock of the Company immediately following the Closing (including Company Common Stock, Company Series A Preferred Stock on an as-converted basis and unexercised Company Pre-Funded Warrants). The shares of Company Common Stock that may be issued under the 2026 ESPP will be automatically increased on January 1 of each year beginning in 2027 and ending with a final increase on January 1, 2036 in an amount equal to the lesser of (x) 1,200,000 shares and (y) 1% of such outstanding capital stock on the preceding December 31, unless a lower (or no) increase is determined by the administrator of the 2026 ESPP.
The foregoing description of the 2026 ESPP is not complete and is subject to and qualified in its entirety by reference to the complete text of the 2026 ESPP, a copy of which is attached hereto as Exhibit 10.14 and incorporated herein by reference.
Appointment of Directors and Certain Officers
On November 6, 2026, the Company’s board of directors appointed Gregory Divis as the Company’s President and Chief Executive Officer, Brett Hagen as the Company’s Senior Vice President, Finance and Chief Accounting Officer, and Jerad Seurer as the Company’s General Counsel and Corporate Secretary, each to serve at the discretion of the Board. Mr. Hagen will serve as the Company’s principal financial officer and principal accounting officer.
On November 6, 2026, the Company’s board of directors fixed its size at five members and appointed the following five individuals to the Board: Julianne Bruno, Gregory Divis, Michelle Pernice, Laura Sandler and Todd Shegog. Ms. Pernice and Ms. Sandler were designated as Class I directors, with initial terms expiring at the Company’s 2027 annual meeting of stockholders; Ms. Bruno and Mr. Shegog were designated as Class II directors, with initial terms expiring at the Company’s 2028 annual meeting of stockholders; and Mr. Divis was designated as a Class III director, with an initial term expiring at the Company’s 2029 annual meeting of stockholders. In connection with her appointment to the Board, Ms. Bruno was also appointed as Chair of the Board.
Pursuant to the Certificate of Designation, at all times when at least 30% of the originally issued Company Series A Preferred Stock remains issued and outstanding, the holders of the Company Series A Preferred Stock, exclusively and voting together as a separate class on an as-converted basis, are entitled to elect two Preferred Directors, and the holders of Company Common Stock and of any other class or series of voting stock, exclusively and voting together as a single class on an as-converted basis, are entitled to elect the balance of the total number of directors. Each Preferred Director is entitled to three votes on each matter presented to the Board. Julianne Bruno and Michelle Pernice serve as the Preferred Directors, and Gregory Divis, Laura Sandler and Todd Shegog serve as the three at-large directors. The two Preferred Directors represent, in the aggregate, approximately 66.7% of the total votes of the Board (assuming no vacancies).
Other than as disclosed in the section of the Proxy Statement/Prospectus entitled “Certain Relationships and Related Party Transactions of the Combined Company” beginning on page 426 and incorporated herein by reference, none of the Company’s newly appointed officers or directors has a direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K. Other than the Merger Agreement and the Certificate of Designation, pursuant to which the holders of the Company Series A Preferred Stock are entitled to elect the Preferred Directors, there are no arrangements or understandings between the Company’s officers or directors and any other person pursuant to which such officers or directors were selected as an officer or a director. There are no family relationships among any of the Company’s directors and officers.
Each of the newly appointed principal officer’s and director’s biographical information is set forth below.
Gregory Divis. Mr. Divis, age 60, has served as Mentari’s Chief Executive Officer and President and as a member of the Mentari board of directors since July 2026. Prior to joining Mentari, Mr. Divis served as the Chief Executive Officer and member of the board of directors of Avadel Pharmaceuticals plc, a biopharmaceutical company, from June 2019 until Avadel’s acquisition by Alkermes plc in February 2026, after having served as Interim Chief Executive Officer from January 2019 to May 2019. He was appointed Executive Vice President and Chief Commercial Officer of Avadel Pharmaceuticals plc in January 2017 and was promoted to Chief Operating Officer in March 2018. Before joining Avadel, Mr. Divis served as an Executive in Residence at Linden Capital Partners, a
healthcare-focused private equity firm. Mr. Divis previously served on the board of directors of Jaguar Health, Inc. (Nasdaq: JAGX) from June 2018 until July 2022. Mr. Divis is a graduate of the University of Iowa. In February 2019, Avadel Specialty Pharmaceuticals, LLC, a wholly owned subsidiary of Avadel Pharmaceuticals plc and of which Mr. Divis served as President, filed a voluntary bankruptcy petition under Chapter 11 of the U.S. Bankruptcy Code.
The Company believes that Mr. Divis is qualified to serve as a member of the Board because of his extensive leadership experience as chief executive officer of a public biopharmaceutical company and his commercial and operational experience in the pharmaceutical industry.
Brett Hagen. Mr. Hagen, age 53, has served as Mentari’s Senior Vice President, Finance and Chief Accounting Officer since August 2026. Prior to joining Mentari, Mr. Hagen served as Chief Accounting Officer for Kalaris Therapeutics, Inc. (Nasdaq: KLRS), a biopharmaceutical company, from March 2025 to July 2026. Before joining Kalaris, Mr. Hagen served as the Chief Accounting Officer for AlloVir, Inc., a biotechnology company, from January 2019 to March 2025. Mr. Hagen received his B.A. from the University of Minnesota, and graduate degrees in accounting and finance from Wright State University and Suffolk University, respectively.
Jerad Seurer. Mr. Seurer, age 53, has served as Mentari’s General Counsel and Corporate Secretary since August 2026. Prior to joining Mentari, Mr. Seurer served as the General Counsel and Corporate Secretary at Avadel Pharmaceuticals plc, a biopharmaceutical company, from September 2020 until Avadel’s acquisition by Alkermes plc in February 2026, after having served as Vice President and Deputy General Counsel from October 2017 to August 2020. Before joining Avadel, Mr. Seurer was at Mallinckrodt plc from October 2004 to April 2017, where he held numerous positions, including Group General Counsel for the Generics/API business, as well as Vice President of Integration Management. From December 1999 to October 2004, he was in private law firm practice. Mr. Seurer received his B.S. in Biology, M.A. in Biology, and J.D. in Law from the University of South Dakota.
Julianne Bruno. Ms. Bruno, age 40, has served as a member of the Mentari board of directors since May 2026. Ms. Bruno is a Growth Partner at Fairmount, a position she has held since May 2025. Prior to joining Fairmount, she was a pivotal member of the leadership team of CRISPR Therapeutics AG (Nasdaq: CRSP), a biopharmaceutical company. During her six-year tenure with CRISPR, she served as the Program Leader across multiple hematology and oncology programs before taking on the role of Chief Operating Officer in May 2024 until April 2025. In these roles, she oversaw the development of Casgevy™ and helped mature the operating model of the company. Ms. Bruno has also worked as a leader in the life sciences practice at McKinsey & Co. She received her A.B. from Princeton University and an M.B.A. from the Wharton School, University of Pennsylvania. Ms. Bruno has served as a director of Damora Therapeutics, Inc. (Nasdaq: DMRA) since November 2025 and Avere Therapeutics, Inc. since January 2026.
The Company believes Ms. Bruno is qualified to serve as a member of the Board due to her extensive leadership, managerial and board experience within the biotechnology industry.
Michelle Pernice. Ms. Pernice, age 38, has served as a member of the Mentari board of directors since May 2026. Ms. Pernice is an Operating Partner at Fairmount Funds Management LLC, a healthcare investment firm. Prior to joining Fairmount in October 2023, Ms. Pernice served in global regulatory roles for numerous pharmaceutical and biotechnology companies, including Pardes Biosciences from 2021 to 2023, Dynavax Technologies Corp., a commercial-stage biopharmaceutical company, from 2019 to 2021, Amgen Inc. (Nasdaq: AMGN), a global biotechnology company, from 2014 to 2019, and Novartis AG (NYSE: NVS), a global pharmaceutical company, from 2012 to 2014, including development strategy across all phases of development, multiple modalities, and notable approvals. Ms. Pernice received her PharmD from St. John’s University and completed a post-PharmD fellowship through Rutgers University. Ms. Pernice has served as a director of Korsana Biosciences, Inc. (Nasdaq: KRSA) since November 2024.
The Company believes Ms. Pernice is qualified to serve as a member of the Board because of her experience advising biotechnology companies and her background in global regulatory and development strategy.
Laura Sandler. Ms. Sandler, age 49, has served as a member of the Mentari board of directors since May 2026. Ms. Sandler has served as Chief Operating Officer of Oruka Therapeutics, Inc. (Nasdaq: ORKA), a biotechnology
company, since July 2025. Prior to joining Oruka Therapeutics, Ms. Sandler was, from September 2023 to March 2024, the Senior Vice President of Strategic Operations at Kelonia Therapeutics, Inc., a biopharmaceutical company, and was responsible for program leadership, program management, and quality assurance. She was an independent biopharmaceutical consultant from July 2022 to August 2023. Prior to that, from March 2017 to June 2022, Ms. Sandler held various positions at CRISPR Therapeutics AG (Nasdaq: CRSP), a biopharmaceutical company, ending as Senior Vice President of Development Operations, where she was the head of clinical execution and development operations. From September 2013 to March 2017, Ms. Sandler led the development operations team for the Lyfgenia™ program at bluebird bio, Inc., a biopharmaceutical company. Earlier in her career, she held roles in project management and clinical operations at Ventrus Biosciences Inc., Novartis, IQVIA, and MedImmune. Ms. Sandler earned her master’s degree in public health from Boston University and has a bachelor’s degree from MIT.
The Company believes Ms. Sandler is qualified to serve as a member of the Board because of her extensive experience in clinical execution and development operations in the biopharmaceutical industry.
Todd Shegog. Mr. Shegog, age 61, has more than 30 years of financial, operations, corporate strategy and compliance expertise in the biotechnology and pharmaceutical industries. He served as Senior Vice President and Chief Financial Officer of Forma Therapeutics, Inc. (formerly, Nasdaq: FMTX), a clinical-stage biopharmaceutical company, from September 2019 through its acquisition by Novo Nordisk in October 2022. Prior to Forma Therapeutics, Mr. Shegog served as Chief Financial Officer of Synlogic, Inc. (Nasdaq: SYBX), a clinical-stage biopharmaceutical company, where he directed the company’s financial strategy and management as well as facilities and information systems from September 2016 to September 2019. From April 2014 to August 2016, Mr. Shegog served as Senior Vice President and Chief Financial Officer at Forum Pharmaceuticals, Inc., an early-stage biopharmaceutical company, where he was responsible for finance, operations and information systems during their pursuit of innovative therapies for schizophrenia and Alzheimer’s disease. He also served as the Chief Financial Officer of Millennium Pharmaceuticals, Inc., now Takeda Oncology, where he was responsible for management of the company’s financial resources, corporate planning, financial reporting and compliance from 1998 to 2014. Mr. Shegog earned a B.S. in Electrical Engineering from Lafayette College and an M.B.A. from the Tepper School of Management at Carnegie Mellon University. Mr. Shegog has served as a director of Cogent Biosciences, Inc. (Nasdaq: COGT) since February 2021.
The Company believes Mr. Shegog is qualified to serve as a member of the Board because of his financial expertise and extensive leadership, executive, managerial and business experience with life sciences companies.
Committees of the Board of Directors
Audit Committee
On November 6, 2026, Todd Shegog, Michelle Pernice and Laura Sandler were appointed to the Audit Committee, and Todd Shegog, an “audit committee financial expert” within the meaning of the SEC regulations, was appointed the chair of the Audit Committee.
Compensation Committee
On November 6, 2026, Michelle Pernice and Julianne Bruno were appointed to the Compensation Committee, and Michelle Pernice was appointed the chair of the Compensation Committee.
Nominating and Corporate Governance Committee
On November 6, 2026, Laura Sandler and Todd Shegog were appointed to the Nominating and Corporate Governance Committee, and Laura Sandler was appointed the chair of the Nominating and Corporate Governance Committee.
Non-Employee Director Compensation Program
Non-employee members of the Board are eligible to receive cash and equity compensation in accordance with the Company’s non-employee director compensation program, which was approved by the Board on November 6, 2026.
This program provides for the following annual cash retainers, which are payable quarterly in arrears and pro-rated for any partial year of service:
| Annual Retainer |
||||
| Board Retainers |
||||
| Chair |
$ | 70,000 | ||
| Non-Chair Member |
$ | 40,000 | ||
| Audit Committee Retainers: |
||||
| Chair |
$ | 20,000 | ||
| Non-Chair Member |
$ | 10,000 | ||
| Compensation Committee Retainers: |
||||
| Chair |
$ | 15,000 | ||
| Non-Chair Member |
$ | 7,500 | ||
| Nominating and Corporate Governance Committee Retainers |
||||
| Chair |
$ | 10,000 | ||
| Non-Chair Member |
$ | 5,000 | ||
In connection with each annual meeting of the Company’s stockholders, beginning with the Company’s 2027 annual meeting of stockholders, each continuing non-employee member of the Board will receive an annual grant of options to purchase 18,500 shares of Company Common Stock, which will vest on the earlier of the next annual meeting of stockholders or the first anniversary of the date of grant. In addition, in connection with a non-employee director’s initial appointment to the Board, such director will receive an initial grant of options to purchase 37,000 shares of Company Common Stock, subject to vesting in equal monthly installments through the third anniversary of the date of grant. In accordance with this program, each of Ms. Bruno, Ms. Pernice, Ms. Sandler and Mr. Shegog received an initial grant of options to purchase 37,000 shares of Company Common Stock, with a grant date of November 9, 2026.
All members of the Board are also reimbursed for reasonable and documented out-of-pocket travel and lodging expenses incurred in connection with attending meetings and activities of the Board and its committees.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
Amendments to Articles of Incorporation and Bylaws
The information set forth in Item 3.03 of this Current Report on Form 8-K is incorporated herein by reference.
Change in Fiscal Year
On November 6, 2026, the Board approved a change in the Company’s fiscal year end from June 30 to December 31, effective immediately, to align with the fiscal year end of Mentari, which is treated as the accounting acquirer in the Merger. The Company does not intend to file a transition report for the period from July 1, 2026 through December 31, 2026. The Company’s next annual report on Form 10-K will cover the fiscal year ending December 31, 2026 and will include the financial statements of Mentari, as the accounting acquirer.
Item 5.05 Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics.
On November 6, 2026, in connection with the Closing, the Board adopted a new Code of Business Conduct and Ethics of the Company (the “Code of Conduct”), effective as of such date. The Code of Conduct supersedes the existing Code of Business Conduct and Ethics, as previously adopted by InMed’s board of directors (the “Existing Code of Conduct”). The Code of Conduct applies to all directors, officers and employees of the Company and is
intended to enhance understanding of the Company’s standards of ethical business practices and promote awareness of ethical issues that may be encountered in carrying out a director’s, officer’s or employee’s responsibilities. Among other things, the Code of Conduct:
| • | establishes the Company’s policies and standards with respect to (i) conflicts of interest, gifts and corporate opportunities, (ii) fair dealing, confidential information, privacy and use of Company assets and systems, (iii) legal and regulatory compliance, insider trading and anti-corruption standards, including pursuant to the Foreign Corrupt Practices Act, (iv) the Company’s disclosure obligations and recordkeeping procedures, (v) anti-discrimination, equal employment opportunity and health and safety and (vi) international trade compliance; |
| • | establishes the Company’s whistleblower hotline and procedures for reporting potential violations; and |
| • | establishes the Company’s policies and procedures with respect to an amendment or waiver of the Code of Conduct. |
The adoption of the Code of Conduct did not result in any explicit or implicit waiver of any provision of the Existing Code of Conduct. The foregoing description of the Code of Conduct does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Code of Conduct, a copy of which is attached hereto as Exhibit 14.1 and is incorporated herein by reference.
Item 5.06 Change in Shell Company Status.
As a result of the Merger, the Company ceased to be a shell company (as defined in Rule 12b-2 of the Exchange Act) as of the Closing Date. The material provisions of the Merger Agreement are described in the Proxy Statement/Prospectus in the section entitled “The Merger Agreement” beginning on page 196 and are incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired
The unaudited condensed consolidated financial statements of Mentari as of June 30, 2026 and for the three and six months ended June 30, 2026 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-55 and are incorporated herein by reference.
The audited financial statements of Mentari as of December 31, 2025 and for the period from June 13, 2025 (inception) to December 31, 2025 and the related notes thereto are included in the Proxy Statement/Prospectus beginning on page F-29 and are incorporated herein by reference.
(b) Pro Forma Financial Information
The unaudited pro forma condensed combined financial information of InMed and Mentari as of and for the six months ended June 30, 2026 and the year ended December 31, 2025 and the related notes thereto are attached hereto as Exhibit 99.1 and are incorporated herein by reference.
(d) Exhibits
| Exhibit | Description | |
| 2.1† | ||
| 2.2 | ||
| 3.1* | Articles of Domestication of Mentari Therapeutics, Inc., effective November 6, 2026. | |
| 3.2* | Articles of Incorporation of Mentari Therapeutics, Inc., effective November 6, 2026. | |
| 3.3* | ||
| 3.4* | Bylaws of Mentari Therapeutics, Inc., effective November 6, 2026. | |
| 4.1 | ||
| 10.1 | ||
| 10.2 | ||
| 10.3 | ||
| 10.4 | ||
| 10.5 | ||
| 10.6* | ||
| 10.7††* | ||
| 10.8#* | Form of Indemnification Agreement for directors and officers of the Company. | |
| 10.9# | ||
| 10.10# | ||
| 10.11# | ||
| 10.12# | ||
| 10.13#* | ||
| 10.14#* | Mentari Therapeutics, Inc. 2026 Employee Stock Purchase Plan. | |
| 10.15#* | ||
| 10.16#* | ||
| 10.17†† | ||
| 10.18†† | ||
| 10.19†† | ||
| 10.20†† | ||
| 10.21†† | ||
| 10.22†† | ||
| 10.23 | ||
| 10.24# | ||
| 10.25# | ||
| 10.26# | ||
| 14.1* | Code of Business Conduct and Ethics of Mentari Therapeutics, Inc. | |
| 21.1* | ||
| 99.1* | ||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
| * | Filed herewith. |
| # | Indicates management contract or compensatory plan. |
| † | Exhibits and/or schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The registrant hereby undertakes to furnish supplementally copies of any of the omitted exhibits and schedules upon request by the SEC; provided, however, that the registrant may request confidential treatment pursuant to Rule 24b-2 under the Exchange Act for any exhibits or schedules so furnished. |
| †† | Portions of this exhibit (indicated by “[***]”) have been omitted in accordance with the rules of the Securities and Exchange Commission. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Mentari Therapeutics, Inc. | ||||||
| (Registrant) |
||||||
| Date: November 10, 2026 |
By: |
/s/ Jerad G. Seurer | ||||
| Name: |
Jerad G. Seurer | |||||
| Title: |
General Counsel and Corporate Secretary | |||||
401 North Carson Street Carson City, Nevada 89701-4201 (775) 684-5708 Articles of Domestication (PURSUANT TO NRS 92A.270) TYPE OR PRINT - USE DARK INK ONLY - DO NOT HIGHLIGHT 1. Domestic Entity Information: Legal Name of Nevada entity as it will appear in the Nevada formation document. Mentari Therapeutics, Inc. Type of Nevada business entity (such as a Corporation, LLC, etc.): Corporation 2. Prior Name: Legal name of the organization as it existed before domesticating in Nevada: Mentari Therapeutics, Inc. 3. Original Filing Date and Jurisdiction: Original jurisdiction of formation: British Columbia, Canada Original formation date: May 19, 1981 4. Jurisdiction: Principal place of business (state or country) prior to domestication: British Columbia, Canada 5. Signature: Eric A. Adams CEO and President First Name Last Name Title X /s/ Eric A. Adams November 6, 2026 Signature Date Include the appropriate fees. See instructions. Page 1 of 1 Revised: 7/1/2026
Exhibit 3.2
ARTICLES OF INCORPORATION
OF
MENTARI THERAPEUTICS, INC.
ARTICLE I
NAME OF CORPORATION
The name of the corporation is Mentari Therapeutics, Inc. (the “Corporation”). The Corporation is the continuation of the existence of Mentari Therapeutics, Inc., a corporation organized under the laws of British Columbia, Canada, which was domesticated as a Nevada corporation pursuant to Section 92A.270 of the Nevada Revised Statutes (as amended from time to time, the “NRS”).
ARTICLE II
REGISTERED AGENT AND REGISTERED OFFICE
The registered office of the Corporation shall be the street address of its registered agent in the State of Nevada. The Corporation may, from time to time, in the manner provided by law, change the registered agent and registered office within the State of Nevada. The Corporation may also maintain an office or offices for the conduct of its business, either within or without the State of Nevada.
ARTICLE III
PURPOSE
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the NRS.
ARTICLE IV
CAPITAL STOCK
A. Authorized Capital Stock. The total number of shares of capital stock which the Corporation shall have authority to issue is 510,000,000, of which (i) 500,000,000 shares shall be a class designated as common stock, par value $0.0001 per share (the “Common Stock”), and (ii) 10,000,000 shares shall be a class designated as preferred stock, par value $0.0001 per share (the “Preferred Stock”). The powers, preferences and rights of, and the qualifications, limitations and restrictions upon, each class or series of stock shall be determined in accordance with, or as set forth below in, this Article IV.
B. Common Stock. Subject to all the rights, powers and preferences of any outstanding class or series of Preferred Stock and except as provided by law or in these Articles of Incorporation (as amended from time to time, including by any certificate of designation relating to any class or series of Preferred Stock, the “Articles”):
1. the holders of the Common Stock shall have the exclusive right to vote for the election of directors of the Corporation (the “Directors”) and on all other matters requiring stockholder action, each outstanding share entitling the holder thereof to one vote on each matter properly submitted to the stockholders of the Corporation for their vote;
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provided that, except as otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any amendment to the Articles that alters or changes the powers, preferences, rights or other terms of any outstanding class or series of Preferred Stock if the holders of the affected class(es) or series of such Preferred Stock are entitled to vote, either separately or together with the holders of one or more other such class(es) or series of Preferred Stock, on such amendment pursuant to these Articles or pursuant to the NRS;
2. dividends and other distributions (as defined in NRS 78.191) may be declared and paid or set apart for payment upon the Common Stock out of any assets or funds of the Corporation legally available therefor, but only when and as declared by the Board of Directors or any authorized committee thereof; and
3. upon the voluntary or involuntary liquidation, dissolution or winding up of the Corporation, the net assets of the Corporation shall be distributed pro rata to the holders of the Common Stock.
C. Preferred Stock. The Board of Directors or any authorized committee thereof is expressly authorized, to the fullest extent permitted by law, to establish and designate by resolution and by filing a certificate of designation pursuant to the NRS, out of any undesignated and unissued shares of Preferred Stock, shares of Preferred Stock in one or more classes or series, to establish or change from time to time the number of shares of each such class or series (but not below the number of shares thereof then outstanding), and to fix the voting powers (if any), designations, preferences, limitations, restrictions and relative rights of the shares of each series.
ARTICLE V
STOCKHOLDER ACTION
A. Action without Meeting. Subject to the rights, if any, of the holders of any outstanding class or series of Preferred Stock, any action required or permitted to be taken by the stockholders of the Corporation at any annual or special meeting of stockholders must be effected at a duly called annual or special meeting of stockholders and may not be taken or effected by written consent.
B. Special Meetings. Except as otherwise required by the NRS and subject to the rights, if any, of the holders of any outstanding class or series of Preferred Stock, special meetings of the stockholders of the Corporation may be called only by the Board of Directors, and special meetings of stockholders may not be called by any other person or persons. Only those matters set forth in the notice of the special meeting may be considered or acted upon at a special meeting of stockholders of the Corporation.
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ARTICLE VI
DIRECTORS
A. General. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors except as otherwise provided herein or required by law.
B. Election of Directors. Election of Directors need not be by written ballot unless the Bylaws of the Corporation (the “Bylaws”) shall so provide.
C. Number of Directors; Term of Office. The number of Directors of the Corporation shall be fixed from time to time solely and exclusively by the Board of Directors. The Directors, including those who may be elected by the holders of any class or series of Preferred Stock, shall be classified, with respect to the term for which they severally hold office, into three classes as nearly equal in number as is practicable, which classes are hereby designated as Class I, Class II and Class III. At each annual meeting of stockholders, Directors elected to succeed those Directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election, provided that notwithstanding the foregoing, the Directors elected to each class shall hold office until their successors are duly elected and qualified or until their earlier resignation, death or removal. Notwithstanding the foregoing, whenever the holders of any class or series of Preferred Stock have the right, voting separately as a series or together with holders of any other class(es) or series of Preferred Stock, to elect Directors at an annual or special meeting of stockholders, the election, term of office, filling of vacancies and other features of such directorships shall be governed by the terms of these Articles including the certificate of designation relating to each such class or series of Preferred Stock.
D. Vacancies. Subject to the rights, if any, of the holders of any class or series of Preferred Stock to elect Directors and to fill vacancies on the Board of Directors relating thereto, any and all vacancies on the Board of Directors, however occurring, including, without limitation, by reason of an increase in the size of the Board of Directors, or the death, resignation, disqualification or removal of a Director, shall be filled solely and exclusively by a majority of the remaining Directors then in office, even if less than a quorum of the Board of Directors, and not by the stockholders, and any Director so appointed shall hold office for the remainder of the term of the class of Directors in which the new directorship was created or the vacancy occurred and until such Director’s successor shall have been duly elected and qualified or until his or her earlier resignation, death or removal. Subject to the rights, if any, of the holders of any class or series of Preferred Stock to elect Directors, when the number of Directors is increased or decreased, the Board of Directors shall, subject to these Articles and the NRS, determine the class or classes to which the increased or decreased number of Directors shall be apportioned; provided that no decrease in the number of Directors shall shorten the term of any incumbent Director. In the event of a vacancy on the Board of Directors, the remaining Directors, except as otherwise provided by law, shall exercise the powers of the full Board of Directors until the vacancy is filled.
E. Removal. Subject to the rights, if any, of any class or series of Preferred Stock to elect Directors and to remove any Director whom the holders of any such series have the right to elect, any Director (including any person appointed by the Board of Directors to fill a vacancy in the Board of Directors) may be removed from office only for cause, by the affirmative vote of the holders of not less than two thirds (2/3) of the voting power of the outstanding shares of capital stock then entitled to vote in an election of Directors.
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ARTICLE VII
LIMITATION OF LIABILITY
A. Limitation of Liability. The liability of the Directors and officers of the Corporation is hereby eliminated or limited to the fullest extent permitted by the NRS. If the NRS is amended to further eliminate or limit or authorize corporate action to further eliminate or limit the liability of directors or officers, the liability of the Directors and officers of the Corporation shall be eliminated or limited to the fullest extent permitted by the NRS.
B. Repeal and Conflicts. Any amendment, repeal or modification of this Article VII (whether approved by the stockholders of the Corporation or pursuant to an amendment of the NRS), shall be prospective only and shall not adversely affect any limitation on the liability of any Director or officer of the Corporation existing at the time of such amendment, repeal or modification with respect to any act or omission of such Director or officer occurring before such amendment, repeal or modification. In the event of any conflict between any section of this Article VII and any other provision of these Articles, the terms and provisions of this Article VII shall control.
ARTICLE VIII
AMENDMENT OF BYLAWS
A. Amendment by Directors. Except as otherwise provided by law, the Bylaws of the Corporation may be amended or repealed, in whole or in part, and new Bylaws may be adopted, by the Board of Directors.
B. Amendment by Stockholders. The Bylaws of the Corporation may be amended or repealed, in whole or in part, and new Bylaws may be adopted, at any annual meeting of stockholders or special meeting of stockholders called for such purpose, by the affirmative vote of the holders of not less than two thirds (2/3) of the voting power of the outstanding shares of capital stock entitled to vote thereon, voting together as a single class; provided that if the Board of Directors recommends that stockholders approve such amendment, repeal or adoption at such meeting of stockholders, such amendment, repeal or adoption shall only require the affirmative vote of the holders of a majority of the voting power of the outstanding shares of capital stock entitled to vote thereon, voting together as a single class.
ARTICLE IX
AMENDMENT OF ARTICLES OF INCORPORATION
The Corporation reserves the right to amend or repeal the Articles in the manner now or hereafter prescribed by the NRS and these Articles, and all rights conferred upon stockholders herein are granted subject to this reservation. Whenever any vote of the holders of capital stock of the Corporation is required to amend or repeal any provision of the Articles, and in addition to any other vote of holders of capital stock that is required by the Articles or by law, such amendment or repeal shall require the affirmative vote of the holders of a majority of the voting power of the outstanding shares of capital stock entitled to vote thereon, and the affirmative vote of the holders of a majority of the voting power of the outstanding shares of each class entitled to vote thereon as a class, at a duly constituted meeting of stockholders called expressly for such purpose;
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provided, however, that the affirmative vote of the holders of not less than two thirds (2/3) of the voting power of the outstanding shares of capital stock entitled to vote thereon, and the affirmative vote of the holders of not less than two thirds (2/3) of the voting power of the outstanding shares of each class entitled to vote thereon as a class, shall be required to amend or repeal any provision of Article V, Article VI, Article VII, Article VIII, Article IX or Article XI of these Articles.
ARTICLE X
SPECIAL PROVISIONS REGARDING DISTRIBUTIONS
Subject to the other provisions of these Articles, the Corporation is hereby specifically allowed to make any distribution that otherwise would be prohibited by NRS 78.288(2)(b).
ARTICLE XI
LIMITED JURY TRIAL WAIVER
To the fullest extent permitted by the NRS and not inconsistent with any applicable laws of the United States, any and all internal actions (as defined in NRS 78.046) must be tried in a court of competent jurisdiction in the State of Nevada before the presiding judge as the trier of fact, and not before a jury. This Article XI shall conclusively operate as a waiver of the right of trial by jury by each party to any internal action.
ARTICLE XII
INAPPLICABILITY OF COMBINATIONS WITH INTERESTED STOCKHOLDER STATUTES
The Corporation shall not be subject to, and hereby expressly elects not to be governed by, any of the provisions of NRS 78.411 to 78.444, inclusive.
ARTICLE XIII
DEEMED NOTICE AND CONSENT
To the fullest extent permitted by law, any person or entity who has acquired or holds, or who may acquire or hold, any interest (of any nature whatsoever) in shares of capital stock or other securities of the Corporation shall be deemed, by reason of and from and after the time of such purchase or other acquisition, to have notice of and to have consented to the provisions of (a) these Articles, (b) the Bylaws and (c) any amendment to the Articles of Incorporation or the Bylaws enacted or adopted in accordance with the Articles of Incorporation, the Bylaws and applicable law.
ARTICLE XIV
SEVERABILITY
If any provision or provisions of the Articles shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provision(s) in any other circumstance and of the remaining provisions of the Articles (including, without limitation, each portion of any paragraph of the Articles containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not, to the fullest extent permitted by appliable law, in
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any way be affected or impaired thereby; and (ii) to the fullest extent permitted by applicable law, the provisions of the Articles (including, without limitation, each such portion of any paragraph of the Articles containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to permit the Corporation to protect its directors, officers, employees and agents from individual liability or for the benefit of the Corporation.
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Exhibit 3.3
MENTARI THERAPEUTICS, INC.
CERTIFICATE OF DESIGNATION
OF
SERIES A NON-VOTING CONVERTIBLE PREFERRED STOCK
Pursuant to Nevada Revised Statutes 78.1955
1. Definitions. For the purposes hereof, the following terms shall have the following meanings:
“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 of the Securities Act of 1933, as amended.
“Articles of Incorporation” means the articles of incorporation of the Corporation, as amended and/or restated from time to time, including any certificate of designation establishing any class or series of preferred stock.
“Board of Directors” means the board of directors of the Corporation.
“Business Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“Buy-In” shall have the meaning set forth in Section 6.4.4.
“Certificate of Designation” means this Certificate of Designation of Series A Non-Voting Convertible Preferred Stock, as amended and/or restated from time to time.
“Closing Sale Price” means, for any security as of any date, the last closing trade price for such security immediately prior to 4:00 p.m., New York City time, on the principal Trading Market where such security is listed or traded, as reported by Bloomberg, L.P. (or an equivalent, reliable reporting service), or if the foregoing do not apply, the last trade price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, L.P., or, if no last trade price is reported for such security by Bloomberg, L.P., the average of the bid prices of any market makers for such security as reported on the OTC Pink Market by OTC Markets Group, Inc. If the Closing Sale Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Sale Price of such security on such date shall be the fair market value as determined in good faith by the Board of Directors of the Corporation.
“Commission” means the United States Securities and Exchange Commission.
“Common Stock” means the Corporation’s common stock, par value $0.0001 per share, and shares of any other class of securities into which such Common Stock may hereafter be reclassified or changed.
“Conversion Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Series A Non-Voting Preferred Stock in accordance with the terms of this Certificate of Designation.
“Corporation” means Mentari Therapeutics, Inc., a Nevada corporation.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Holder” means a holder of any share(s) of Series A Non-Voting Preferred Stock.
“Merger Agreement” means the Agreement and Plan of Merger and Reorganization dated May 19, 2026, by and among the Corporation, Indigo Merger Sub Corp., a Delaware corporation and wholly owned subsidiary of the Corporation, Indigo Merger Sub II, LLC, a Delaware limited liability company and wholly owned subsidiary of the Corporation, and Mentari Therapeutics, Inc., a Delaware corporation, as amended from time to time.
“NRS” means the Nevada Revised Statutes, as amended from time to time.
“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Preferred Stock” means the Corporation’s preferred stock, par value $0.0001 per share, issuable from time to time in one or more series.
“Trading Day” means a day on which the principal Trading Market is open for business.
“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).
2. Designation, Amount and Par Value. The series of Preferred Stock established hereby shall be designated as the Corporation’s Series A Non-Voting Convertible Preferred Stock (the “Series A Non-Voting Preferred Stock”) and the number of shares so designated shall be 4,013. Each share of Series A Non-Voting Preferred Stock shall have a par value of $0.0001 per share.
3. Dividends and Other Distributions. Holders shall be entitled to receive, and the Corporation shall pay, dividends and other distributions (as defined in NRS 78.191) on shares of the Series A Non-Voting Preferred Stock (on an as-if-converted-to-Common-Stock basis, without regard to the Beneficial Ownership Limitation (as defined below)) equal to and in the same form, and in the same manner, as distributions (other than dividends on shares of the Common Stock payable in the form of Common Stock) actually paid on shares of the Common Stock when, as and if such distributions (other than dividends payable in the form of Common Stock) are paid on shares of the Common Stock. Other than as set forth in the previous sentence, no other distribution shall be paid on the Series A Non-Voting Preferred Stock, and the Corporation shall pay no distribution (other than dividends payable in the form of Common Stock) on the Common Stock unless it simultaneously complies with this Section 3.
4. Voting Rights.
4.1 Except as otherwise provided herein or as otherwise required by the NRS, the Series A Non-Voting Preferred Stock shall have no voting rights, provided that as long as any shares of Series A Non-Voting Preferred Stock are outstanding, the Corporation shall not, without the affirmative vote of the holders of a majority of the then-outstanding shares of the Series A Non-Voting Preferred Stock:
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(i) alter or change adversely the powers, preferences or rights given to the Series A Non-Voting Preferred Stock or alter or amend this Certificate of Designation, amend or repeal any provision of, or add any provision to, the Articles of Incorporation, including any certificate of designation (or any amendment thereto) relating to any series of Preferred Stock, or the bylaws of the Corporation (as amended from time to time, the “Bylaws”), if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series A Non-Voting Preferred Stock, regardless of whether any of the foregoing actions shall be by means of amendment to the Articles of Incorporation or by merger, consolidation, recapitalization, reclassification, conversion or otherwise, (ii) issue further shares of Series A Non-Voting Preferred Stock or increase or decrease (other than by conversion pursuant to Section 6) the number of authorized shares of Series A Non-Voting Preferred Stock, (iii) at any time while at least 30% of the originally issued Series A Non-Voting Preferred Stock remains issued and outstanding, (A) consummate (I) any Fundamental Transaction (as defined below) or (II) any merger or consolidation of the Corporation with or into another entity or any stock sale to, or other business combination in which the stockholders of the Corporation immediately before such transaction do not hold at least a majority on an as-converted-to-Common Stock basis of the capital stock of the Corporation immediately after such transaction, (B) increase the size of the board of directors of the Corporation, (C) adopt, amend or repeal any written delegation of authority policy, corporate authority matrix or similar document, framework or schedule unless such adoption, amendment or repeal has been approved by the unanimous vote of the board of directors of the Corporation or (D) retain or replace the Corporation’s registered independent public accounting firm, independent compensation consultant or corporate counsel, or (iv) enter into any agreement with respect to any of the foregoing. Holders of Common Stock acquired upon the conversion of shares of Series A Non-Voting Preferred Stock shall be entitled to the same voting rights as each other holder of Common Stock.
4.2 Any vote required or permitted under Section 4.1 may be taken at a meeting of the Holders or through the execution of an action by written consent in lieu of such meeting or other written waiver by such stockholders, provided that the consent or waiver is executed by Holders representing at least a majority of the outstanding shares of Series A Non-Voting Preferred Stock.
4.3 Election of Directors and Director Voting Rights.
4.3.1 At all times when at least 30% of the originally issued Series A Non-Voting Preferred Stock remains issued and outstanding, (i) the Holders of record of the Series A Non-Voting Preferred Stock, exclusively and voting together as a separate class on as-converted-to-Common Stock basis, shall be entitled to elect two directors of the Corporation (the “Preferred Directors”); and (ii) the holders of record of the Common Stock and of any other class or series of voting stock (including the Series A Non-Voting 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; provided, however, for administrative convenience, the initial Preferred Directors may also be appointed by the Board of Directors in connection with the approval of the initial issuance of Series A Non-Voting Preferred Stock without a separate action by the Holders of Series A Non-Voting Preferred Stock.
4.3.2 Any Preferred Director elected as provided in Section 4.3.1 may be removed without cause by, and only by, the affirmative vote of the Holders of not less than two-thirds (2/3s) of the voting power of the outstanding shares of Series A Non-Voting Preferred Stock, given either at a special meeting of such Holders duly called for that purpose or pursuant to a written consent of such Holders.
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4.3.3 If the Holders of the Series A Non-Voting Preferred Stock fail to elect a sufficient number of directors to fill all directorships for which they are entitled to elect directors pursuant to Section 4.3.1 and to the extent any of such directorships is not otherwise filled by a director appointed in accordance with the proviso in Section 4.3.1, then any directorship not so filled shall remain vacant until such time as the Holders of the Series A Non-Voting Preferred Stock fill such directorship in accordance with Section 4.3.1.
4.3.4 At any meeting held for the purpose of electing a Preferred Director, the presence in person or by proxy of the Holders of a majority of the outstanding Series A Non-Voting Preferred Stock shall constitute a quorum for the purpose of electing such Preferred Director.
4.3.5 Each Preferred Director shall be entitled to three votes on each matter presented to the Board of Directors.
5. Rank; Liquidation.
5.1 The Series A Non-Voting Preferred Stock shall rank on parity with the Common Stock as to distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily or involuntarily.
5.2 Upon any liquidation, dissolution or winding-up of the Corporation, whether voluntary or involuntary (a “Liquidation”), each Holder shall be entitled to receive out of the assets, whether capital or surplus, of the Corporation the same amount that a holder of Common Stock would receive if the Series A Non-Voting Preferred Stock were fully converted (disregarding for such purpose any Beneficial Ownership Limitation) to Common Stock which amounts shall be paid pari passu with all holders of Common Stock, plus an additional amount equal to any declared and unpaid distributions then payable on the Series A Non-Voting Preferred Stock. If, upon any such Liquidation, the assets of the Corporation shall be insufficient to pay the Holders of shares of the Series A Non-Voting Preferred Stock the amount required under the preceding sentence, then all remaining assets of the Corporation shall be distributed ratably to the Holders and the holders of Common Stock in accordance with the respective amounts that would be payable on all such securities if all amounts payable thereon were paid in full. For the avoidance of any doubt, a Fundamental Transaction shall not be deemed a Liquidation unless the Corporation expressly declares that such Fundamental Transaction shall be treated as if it were a Liquidation.
6. Conversion.
6.1 Conversion at Option of Holder. Subject to Section 6.3, each outstanding share of Series A Non-Voting Preferred Stock shall be convertible, at any time and from time to time, at the option of the Holder thereof, into a number of shares of Common Stock equal to the Conversion Ratio, subject to the Beneficial Ownership Limitation (as defined below) (each, an “Optional Conversion”). Holders shall effect conversions by providing the Corporation with the form of conversion notice attached hereto as Annex A (a “Notice of Conversion”), duly completed and executed. Provided the Corporation’s transfer agent is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program, the Notice of Conversion may specify, at the Holder’s election, whether the applicable Conversion Shares shall be credited to the account of the Holder’s prime broker with DTC through its Deposit Withdrawal Agent Commission system (a “DWAC Delivery”). The date on which an Optional Conversion shall be deemed effective (the “Conversion Date”) shall be the Trading Day that the Notice of Conversion, completed and executed, is sent via email to, and received during regular business hours by, the Corporation; provided that the original certificate(s) (if any) representing such shares of Series A Non-Voting Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion, are received by the Corporation within two (2) Trading Days thereafter. In all other cases, the Conversion Date shall be defined as the Trading Day on which the original certificate(s) (if any) representing such shares of Series A Non-Voting Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion, are received by the Corporation. The calculations set forth in the Notice of Conversion shall control in the absence of manifest or mathematical error.
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6.2 Conversion Ratio. The “Conversion Ratio” for each share of Series A Non-Voting Preferred Stock shall be 1,000 shares of Common Stock issuable upon the conversion (the “Conversion”) of each share of Series A Non-Voting Preferred Stock (corresponding to a ratio of 1,000:1), subject to adjustment as provided herein.
6.3 Beneficial Ownership Limitation. Notwithstanding anything herein to the contrary, the Corporation shall not effect any conversion of any share of Series A Non-Voting Preferred Stock, and a Holder shall not have the right to convert any portion of the Series A Non-Voting Preferred Stock pursuant to Section 6.1, to the extent that, after giving effect to such attempted conversion set forth on the applicable Notice of Conversion, such Holder (or any of such Holder’s Affiliates or any other Person who would be a beneficial owner of Common Stock beneficially owned by the Holder for purposes of Section 13(d) or Section 16 of the Exchange Act and the applicable rules and regulations of the Commission, including any “group” of which the Holder is a member (the foregoing, “Attribution Parties”)) would beneficially own a number of shares of Common Stock in excess of the Beneficial Ownership Limitation. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by such Holder and its Attribution Parties shall include the number of shares of Common Stock issuable upon conversion of the Series A Non-Voting Preferred Stock subject to the Notice of Conversion with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which are issuable upon (A) conversion of the remaining, unconverted Series A Non-Voting Preferred Stock beneficially owned by such Holder or any of its Attribution Parties, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation (including any warrants) beneficially owned by such Holder or any of its Attribution Parties that are subject to and would exceed a limitation on conversion or exercise similar to the limitation contained herein. Except as set forth in the preceding sentence, for purposes of this Section 6.3, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the applicable rules and regulations of the Commission, and the terms “beneficial ownership” and “beneficially own” have the meanings ascribed to such terms therein. In addition, for purposes hereof, “group” has the meaning set forth in Section 13(d) of the Exchange Act and the applicable rules and regulations of the Commission. For purposes of this Section 6.3, in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as stated in the following: (A) the Corporation’s most recent periodic or annual filing with the Commission, as the case may be, (B) a more recent public announcement by the Corporation that is filed with the Commission, or (C) a more recent notice by the Corporation or the Corporation’s transfer agent to the Holder setting forth the number of shares of Common Stock then outstanding. Upon the written request of a Holder (which may be by email), the Corporation shall, within two (2) Trading Days thereof, confirm in writing to such Holder (which may be via email) the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to any actual conversion or exercise of securities of the Corporation, including shares of Series A Non-Voting Preferred Stock, by such Holder or its Attribution Parties since the date as of which such number of outstanding shares of Common Stock was last publicly reported or confirmed to the Holder. The “Beneficial Ownership Limitation” shall initially be set at the discretion of each Holder to a percentage designated by notice to the Corporation or otherwise between 0% and 19.99% of the number of shares of Common Stock outstanding or deemed to be outstanding as of the applicable measurement date, and such percentage shall be set at 19.99% for any Holder that does not make such designation by notice to the Corporation or otherwise. The Corporation shall be entitled to rely on representations made to it by the Holder in any Notice of Conversion regarding its Beneficial Ownership Limitation. Notwithstanding the foregoing, by written notice to the Corporation (email being sufficient), (i) the Holder may reset the Beneficial Ownership Limitation percentage to a higher percentage, not to exceed
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19.99%, which increase will not be effective until the sixty-first (61st) day after such written notice is delivered to the Corporation, and (ii) the Holder may reset the Beneficial Ownership Limitation percentage to a lower percentage. Upon such a change by a Holder of the Beneficial Ownership Limitation, not to exceed 19.99%, the Beneficial Ownership Limitation may not be further amended by such Holder without first providing the minimum notice required by this Section 6.3. Notwithstanding the foregoing, (x) at any time following notice of a Fundamental Transaction, the Holder may waive and/or change the Beneficial Ownership Limitation effective immediately upon written notice to the Corporation and may reinstitute a Beneficial Ownership Limitation at any time thereafter effective immediately upon written notice to the Corporation and (y) at any time that the beneficial ownership of shares of Common Stock of a Holder (together with any of such Holder’s Attribution Parties) is equal to or less than 9.00% of the number of shares of Common Stock outstanding as of any given date, then such Holder’s Beneficial Ownership Limitation shall automatically be set to 9.99%. The provisions of this Section 6.3 shall be construed, corrected and implemented in a manner so as to effectuate the intended Beneficial Ownership Limitation herein contained and the shares of Common Stock underlying the Series A Non-Voting Preferred Stock in excess of the Beneficial Ownership Limitation shall not be deemed to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act.
6.4 Mechanics of Conversion.
6.4.1 Delivery of Certificate or Electronic Issuance. Upon Conversion not later than two (2) Trading Days after the applicable Conversion Date, or if the Holder requests the issuance of physical certificate(s), two (2) Trading Days after receipt by the Corporation of the original certificate(s) representing such shares of Series A Non-Voting Preferred Stock being converted, duly endorsed, and the accompanying Notice of Conversion (the “Share Delivery Date”), the Corporation shall either: (a) deliver, or cause to be delivered, to the converting Holder a physical certificate or certificates representing the number of Conversion Shares being acquired upon the conversion of shares of Series A Non-Voting Preferred Stock, or (b) in the case of a DWAC Delivery (if so requested by the Holder), electronically transfer such Conversion Shares by crediting the account of the Holder’s prime broker with DTC through its DWAC system. If in the case of any Notice of Conversion such certificate or certificates for the Conversion Shares are not delivered to or as directed by or, in the case of a DWAC Delivery, such shares are not electronically delivered to or as directed by, the applicable Holder by the Share Delivery Date, the applicable Holder shall be entitled to elect to rescind such Notice of Conversion by written notice to the Corporation at any time on or before its receipt of such certificate or certificates for Conversion Shares or electronic receipt of such shares, as applicable, in which event the Corporation shall promptly return to such Holder any original Series A Non-Voting Preferred Stock certificate delivered to the Corporation and such Holder shall promptly return to the Corporation any Common Stock certificates or otherwise direct the return of any shares of Common Stock delivered to the Holder through the DWAC system, representing the shares of Series A Non-Voting Preferred Stock unsuccessfully tendered for conversion to the Corporation.
6.4.2 Obligation Absolute. Subject to Section 6.3 and subject to Holder’s right to rescind a Notice of Conversion pursuant to Section 6.4.1, the Corporation’s obligation to issue and deliver the Conversion Shares upon conversion of Series A Non-Voting Preferred Stock in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by a Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by such Holder or any other Person of any obligation to the Corporation or any violation or alleged violation of law by such Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the Corporation to such Holder in connection with the issuance of such Conversion Shares. Subject to Section 6.3 and subject to Holder’s right to rescind a Notice of Conversion pursuant to Section 6.4.1, in the event a
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Holder shall elect to convert any or all of its Series A Non-Voting Preferred Stock, the Corporation may not refuse conversion based on any claim that such Holder or anyone associated or affiliated with such Holder has been engaged in any violation of law, agreement or for any other reason, unless an injunction from a court, on notice to Holder, restraining and/or enjoining conversion of all or part of the Series A Non-Voting Preferred Stock of such Holder shall have been sought and obtained by the Corporation, and the Corporation posts a surety bond for the benefit of such Holder in the amount of 150% of the value of the Conversion Shares into which would be converted the Series A Non-Voting Preferred Stock which is subject to such injunction, which bond shall remain in effect until the completion of arbitration/litigation of the underlying dispute and the proceeds of which shall be payable to such Holder to the extent it obtains judgment. In the absence of such injunction, the Corporation shall, subject to Section 6.3 and subject to Holder’s right to rescind a Notice of Conversion pursuant to Section 6.4.1, issue Conversion Shares upon a properly noticed conversion.
6.4.3 Cash Settlement. If, at any time after the initial issuance of the Series A Non-Voting Preferred Stock, the Corporation fails to deliver to a Holder such certificate or certificates, or electronically deliver (or instruct its transfer agent to electronically deliver) such shares in the case of a DWAC Delivery, pursuant to Section 6.4.1 on or prior to the third (3rd) Trading Day after the Share Delivery Date applicable to such conversion, other than a failure caused by (i) materially incorrect or incomplete information provided by Holder to the Corporation or (ii) the application of the Beneficial Ownership Limitation, then, unless the Holder has rescinded the applicable Notice of Conversion pursuant to Section 6.4.1, the Corporation shall, at the request of the Holder, pay an amount equal to the Fair Value (as defined below) of such undelivered shares, with such payment to be made within two Business Days from the date of request by the Holder, whereupon the Corporation’s obligations to deliver such shares underlying the Notice of Conversion shall be extinguished upon payment in full of the Fair Value of such undelivered shares. For purposes of this Section 6.4.3, the “Fair Value” of shares shall be fixed with reference to the last reported Closing Sale Price on the principal Trading Market on which the Common Stock is listed as of the Trading Day immediately prior to the date on which the Notice of Conversion is delivered to the Corporation. For the avoidance of doubt, the cash settlement provisions set forth in this Section 6.4.3 shall be available irrespective of the reason for the Corporation’s failure to timely deliver Conversion Shares (other than a failure caused by (i) materially incorrect or incomplete information provided by Holder to the Corporation or (ii) the application of the Beneficial Ownership Limitation), including due to limitations set forth in Section 6.4.6, due to applicable Trading Market rules.
6.4.4 Buy-In on Failure to Timely Deliver Certificates. If the Corporation fails to deliver to a Holder the applicable certificate or certificates or to effect a DWAC Delivery, as applicable, by the Share Delivery Date pursuant to Section 6.4.1 (other than a failure caused by materially incorrect or incomplete information provided by Holder to the Corporation or the application of the Beneficial Ownership Limitation), and if after such Share Delivery Date such Holder is required by its brokerage firm to purchase (in an open market transaction or otherwise), or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by such Holder of the Conversion Shares which such Holder was entitled to receive upon the conversion relating to such Share Delivery Date (a “Buy-In”), then the Corporation shall (A) pay in cash to such Holder (in addition to any other remedies available to or elected by such Holder) the amount by which (x) such Holder’s total purchase price (including any brokerage commissions) for the shares of Common Stock so purchased exceeds (y) the product of (1) the aggregate number of shares of Common Stock that such Holder was entitled to receive from the conversion at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions) and (B) at the option of such Holder, either reissue (if surrendered) the shares of Series A Non-Voting Preferred Stock equal to the number of shares of Series A Non-Voting Preferred Stock submitted for conversion or deliver to such Holder the number of shares of Common Stock that would have been issued if the Corporation had timely complied
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with its delivery requirements under Section 6.4.1. For example, if a Holder purchases shares of Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted conversion of shares of Series A Non-Voting Preferred Stock with respect to which the actual sale price (including any brokerage commissions) giving rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Corporation shall be required to pay such Holder $1,000. The Holder shall provide the Corporation written notice, within three (3) Trading Days after the occurrence of a Buy-In, indicating the amounts payable to such Holder in respect of such Buy-In together with applicable confirmations and other evidence reasonably requested by the Corporation. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Corporation’s failure to timely deliver certificates representing shares of Common Stock upon conversion of the shares of Series A Non-Voting Preferred Stock as required pursuant to the terms hereof or the cash settlement remedy set forth in Section 6.4.3; provided, however, that the Holder shall not be entitled to both (i) require the reissuance of the shares of Series A Non-Voting Preferred Stock submitted for conversion for which such conversion was not timely honored and (ii) receive the number of shares of Common Stock that would have been issued if the Corporation had timely complied with its delivery requirements under Section 6.4.1.
6.4.5 Reservation of Shares Issuable Upon Conversion. The Corporation covenants that at all times it will reserve and keep available out of its authorized and unissued shares of Common Stock for the sole purpose of issuance upon conversion of the Series A Non-Voting Preferred Stock, free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holders of the Series A Non-Voting Preferred Stock, not less than such aggregate number of shares of the Common Stock as shall be issuable (taking into account the adjustments of Section 7) upon the conversion of all outstanding shares of Series A Non-Voting Preferred Stock. The Corporation covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and non-assessable.
6.4.6 Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion of the Series A Non-Voting Preferred Stock, no certificates or scrip for any such fractional shares shall be issued and no cash shall be paid for any such fractional shares. Any fractional shares of Common Stock that a Holder of Series A Non-Voting Preferred Stock would otherwise be entitled to receive shall be aggregated with all fractional shares of Common Stock issuable to such Holder and any remaining fractional shares shall be rounded up to the nearest whole share. Whether or not fractional shares would be issuable upon such conversion shall be determined on the basis of the total number of shares of Series A Non-Voting Preferred Stock the Holder seeks to convert into Common Stock and the aggregate number of Common Stock issuable upon such conversion.
6.4.7 Transfer Taxes. The issuance of certificates for shares of the Common Stock upon conversion of the Series A Non-Voting Preferred Stock shall be made without charge to any Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificates, provided that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the registered Holder(s) of such shares of Series A Non-Voting Preferred Stock and the Corporation shall not be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Corporation the amount of such tax or shall have established to the satisfaction of the Corporation that such tax has been paid.
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6.5 Status as Stockholder. Upon each Conversion Date, (i) the shares of Series A Non-Voting Preferred Stock being converted shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a holder of such converted shares of Series A Non-Voting Preferred Stock shall cease and terminate, excepting only the right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Corporation to comply with the terms of this Certificate of Designation. In all cases, the Holder shall retain all of its rights and remedies for the Corporation’s failure to convert Series A Non-Voting Preferred Stock.
7. Certain Adjustments.
7.1 Stock Dividends and Stock Splits. If the Corporation, at any time while the Series A Non-Voting Preferred Stock is outstanding: (A) pays a stock dividend or otherwise makes a distribution or distributions payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Corporation upon conversion of the Series A Non-Voting Preferred Stock) with respect to the then outstanding shares of Common Stock; (B) subdivides outstanding shares of Common Stock into a larger number of shares; or (C) combines (including by way of a reverse stock split) outstanding shares of Common Stock into a smaller number of shares, then the Conversion Ratio shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding any treasury shares of the Corporation) outstanding immediately after such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately before such event (excluding any treasury shares of the Corporation). Any adjustment made pursuant to this Section 7.1 shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision or combination.
7.2 Fundamental Transaction. If, at any time while the Series A Non-Voting Preferred Stock is outstanding, (A) the Corporation effects any merger or consolidation of the Corporation with or into another Person or any stock sale to, or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, share exchange or scheme of arrangement) with or into another Person (other than such a transaction in which the Corporation is the surviving or continuing entity and its Common Stock is not exchanged for or converted into other securities, cash or property), (B) the Corporation effects any sale, lease, transfer or exclusive license of all or substantially all of its assets in one transaction or a series of related transactions, (C) any tender offer, exchange offer or issuer bid by the Corporation is completed pursuant to which more than 50% of the Common Stock not held by the Corporation is exchanged for or converted into other securities, cash or property, or (D) the Corporation effects any reclassification of the Common Stock or any compulsory share exchange pursuant (other than as a result of a dividend, subdivision or combination covered by Section 7.1) to which the Common Stock is effectively converted into or exchanged for other securities, cash or property (in any such case, a “Fundamental Transaction”), then, upon any subsequent conversion of the Series A Non-Voting Preferred Stock each Holder shall have the right to receive, in lieu of the right to receive Conversion Shares, for each Conversion Share that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental Transaction, the same kind and amount of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of one share of Common Stock (the “Alternate Consideration”). For purposes of any such subsequent conversion, the determination of the Conversion Ratio shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Corporation shall adjust the Conversion Ratio in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then each Holder shall be given the same choice as to the Alternate Consideration it receives upon any conversion of Series A Non-Voting Preferred Stock following such Fundamental Transaction. To the extent
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necessary to effectuate the foregoing provisions, any successor to the Corporation or surviving entity in such Fundamental Transaction shall file a new certificate of designation with the same terms and conditions and issue to the Holders new preferred stock consistent with the foregoing provisions and evidencing the Holders’ right to convert such preferred stock into Alternate Consideration. The terms of any agreement to which the Corporation is a party and pursuant to which a Fundamental Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of this Section 7.2 and ensuring that the Series A Non-Voting Preferred Stock (or any such replacement security) will be similarly adjusted upon any subsequent transaction analogous to a Fundamental Transaction. The Corporation shall cause to be delivered to each Holder, at its last address as it shall appear upon the stock books of the Corporation, written notice of any Fundamental Transaction at least 20 calendar days prior to the date on which such Fundamental Transaction is expected to become effective or close. Notwithstanding anything to the contrary contained herein, any Parent Legacy Transaction (as defined in the Merger Agreement) and the transactions contemplated by the CVR Agreement (as defined in the Merger Agreement) shall not constitute a Fundamental Transaction.
7.3 Calculations. All calculations under this Section 7 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 7, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding any treasury shares of the Corporation) issued and outstanding.
8. Redemption. The shares of Series A Non-Voting Preferred Stock shall not be redeemable; provided, however, that the foregoing shall not limit the ability of the Corporation to purchase or otherwise deal in such shares to the extent otherwise permitted hereby and by law, nor shall the foregoing limit the Holder’s rights under Section 6.4.3.
9. Transfer. A Holder may transfer any shares of Series A Non-Voting Preferred Stock together with the accompanying rights set forth herein, held by such Holder without the consent of the Corporation; provided that such transfer is in compliance with applicable securities laws. The Corporation shall in good faith (i) do and perform, or cause to be done and performed, all such further acts and things, and (ii) execute and deliver all such other agreements, certificates, instruments and documents, in each case, as any Holder of Series A Non-Voting Preferred Stock may reasonably request in order to carry out the intent and accomplish the purposes of this Section 9. The transferee of any shares of Series A Non-Voting Preferred Stock shall be subject to the Beneficial Ownership Limitation applicable to the transferor as of the time of such transfer.
10. Series A Non-Voting Preferred Stock Ledger. The Corporation shall maintain at its principal executive offices (or such other office or agency of the Corporation as it may designate by notice to the Holders in accordance with Section 11), a ledger for the Series A Non-Voting Preferred Stock, in which the Corporation shall record (i) the name, address, and electronic mail address of each Holder in whose name the shares of Series A Non-Voting Preferred Stock have been issued and (ii) the name, address, and electronic mail address of each transferee of any shares of Series A Non-Voting Preferred Stock. The Corporation may deem and treat the record Holder of shares of Series A Non-Voting Preferred Stock as the absolute owner thereof for the purpose of any conversion thereof and for all other purposes. The Corporation shall keep the ledger open and available at all times during business hours for inspection by any Holder of Series A Non-Voting Preferred Stock or his, her or its legal representatives.
11. Notices. Any notice required or permitted by the provisions of this Certificate of Designation to be given to a Holder of shares of Series A Non-Voting Preferred Stock shall be mailed, postage prepaid, to the post office address last shown on the records of the Corporation, or given by electronic communication in compliance with the applicable provisions of the NRS, and shall be deemed sent upon such mailing or electronic transmission.
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12. Book-Entry; Certificates. The Series A Non-Voting Preferred Stock will be issued in book-entry form; provided that, if a Holder requests that such Holder’s shares of Series A Non-Voting Preferred Stock be issued in certificated form, the Corporation will instead issue a stock certificate to such Holder representing such Holder’s shares of Series A Non-Voting Preferred Stock. To the extent that any shares of Series A Non-Voting Preferred Stock are issued in book-entry form, references herein to “certificates” shall instead refer to the book-entry notation relating to such shares.
13. Lost or Mutilated Series A Non-Voting Preferred Stock Certificate. If a Holder’s Series A Non-Voting Preferred Stock certificate shall be mutilated, lost, stolen or destroyed, the Corporation shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated certificate, or in lieu of or in substitution for a lost, stolen or destroyed certificate, a new certificate for the shares of Series A Non-Voting Preferred Stock so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such certificate, and of the ownership hereof reasonably satisfactory to the Corporation.
14. Waiver. Any waiver by the Corporation or a Holder of a breach of any provision of this Certificate of Designation shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Certificate of Designation or a waiver by any other Holders. The failure of the Corporation or a Holder to insist upon strict adherence to any term of this Certificate of Designation on one or more occasions shall not be considered a waiver or deprive that party (or any other Holder) of the right thereafter to insist upon strict adherence to that term or any other term of this Certificate of Designation. Any waiver by the Corporation or a Holder must be in writing. Notwithstanding any provision in this Certificate of Designation to the contrary, any provision contained herein and any right of the Holders of Series A Non-Voting Preferred Stock granted hereunder may be waived as to all shares of Series A Non-Voting Preferred Stock (and the Holders thereof) upon the written consent of the Holders of not less than a majority of the shares of Series A Non-Voting Preferred Stock then outstanding, provided, however, that the Beneficial Ownership Limitation applicable to a Holder, and any provisions contained herein that are related to such Beneficial Ownership Limitation, cannot be modified, waived or terminated without the consent of such Holder, and provided further, that any proposed waiver that would, by its terms, have a disproportionate and materially adverse effect on any Holder shall require the consent of such Holder(s).
15. Severability. Whenever possible, each provision hereof shall be interpreted in a manner as to be effective and valid under applicable law, but if any provision hereof is held to be prohibited by or invalid under applicable law, then such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions hereof.
16. Status of Converted Series A Non-Voting Preferred Stock. If any shares of Series A Non-Voting Preferred Stock shall be converted or redeemed by the Corporation, such shares shall, to the fullest extent permitted by applicable law, be retired and cancelled upon such acquisition, and shall not be reissued as shares of Series A Non-Voting Preferred Stock. Any shares of Series A Non-Voting Preferred Stock so acquired, upon their retirement and cancellation, and upon the taking of any action required by applicable law, shall resume and be restored to the status of authorized but unissued shares of Preferred Stock and shall no longer be designated as shares of Series A Non-Voting Preferred Stock.
[Remainder of Page Intentionally Left Blank]
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ANNEX A
NOTICE OF CONVERSION
(TO BE EXECUTED BY THE REGISTERED HOLDER IN ORDER TO CONVERT SHARES OF SERIES A NON-VOTING CONVERTIBLE PREFERRED STOCK)
The undersigned Holder hereby irrevocably elects to convert the number of shares of Series A Non-Voting Preferred Stock indicated below, represented in book-entry form, into shares of common stock, par value $0.0001 per share (the “Common Stock”), of Mentari Therapeutics, Inc., a Nevada corporation (the “Corporation”), as of the date written below. If securities are to be issued in the name of a Person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. Capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Certificate of Designation of the Series A Non-Voting Convertible Preferred Stock (the “Certificate of Designation”).
As of the date hereof, the number of shares of Common Stock beneficially owned by the undersigned Holder (together with such Holder’s Attribution Parties), including the number of shares of Common Stock issuable upon conversion of the Series A Non-Voting Preferred Stock subject to this Notice of Conversion, but excluding the number of shares of Common Stock which are issuable upon (A) conversion of the remaining, unconverted Series A Non-Voting Preferred Stock beneficially owned by such Holder or any of its Attribution Parties, and (B) exercise or conversion of the unexercised or unconverted portion of any other securities of the Corporation (including any warrants) beneficially owned by such Holder or any of its Attribution Parties that are subject to a limitation on conversion or exercise similar to the limitation contained in Section 6.3 of the Certificate of Designation, is _____%. For purposes hereof, beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the applicable regulations of the Commission. In addition, for purposes hereof, “group” has the meaning set forth in Section 13(d) of the Exchange Act and the applicable regulations of the Commission.
CONVERSION CALCULATIONS:
| Date to Effect Conversion: |
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| Number of shares of Series A Non-Voting Preferred Stock owned prior to Conversion: |
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| Number of shares of Series A Non-Voting Preferred Stock to be Converted: |
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| Number of shares of Common Stock to be Issued: |
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| Address for delivery of physical certificates: |
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For DWAC Delivery, please provide the following:
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Broker No.: |
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| Account No.: |
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| [HOLDER] | ||
| By: |
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| Name: |
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| Title: |
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Exhibit 3.4
BYLAWS
OF
MENTARI THERAPEUTICS, INC.
(a Nevada corporation)
ARTICLE I
CORPORATE OFFICES
Section 1.1 Registered Office. The registered office of Mentari Therapeutics, Inc., a Nevada corporation (the “Corporation”), shall be the street address of the Corporation’s registered agent in the State of Nevada, as determined from time to time by the Corporation’s board of directors (the “Board of Directors”) in accordance with the Corporation’s articles of incorporation (as the same may be amended and/or restated from time to time, and including any certificate of designation relating to any series of Preferred Stock (each, hereinafter referred to as a “Preferred Stock Designation”), the “Articles of Incorporation”).
Section 1.2 Other Offices. The Corporation may also have an office or offices, and keep the books and records of the Corporation, except as may otherwise be required by law, at such other place or places, either within or without the State of Nevada, as the Corporation may from time to time determine or the business of the Corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1 Annual Meeting. An annual meeting of the stockholders of the Corporation, for the election of directors and for the transaction of such other business as may properly come before the meeting, shall be held at such physical location, if any, either within or without the State of Nevada, on such date, and at such time as the Board of Directors shall fix. The Board of Directors may postpone, reschedule or cancel any annual meeting of stockholders previously scheduled by the Board of Directors.
Section 2.2 Special Meeting. Except as otherwise required by law, and except as otherwise provided for or fixed pursuant to the Articles of Incorporation, a special meeting of the stockholders of the Corporation may be called at any time only by the Board of Directors. The Board of Directors may postpone, reschedule or cancel any special meeting of stockholders previously scheduled by the Board of Directors. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting by or at the direction of the Board of Directors.
Section 2.3 Notice of Stockholders’ Meetings.
(a) Whenever stockholders are required or permitted to take any action at a meeting, a notice of the meeting specifying the physical location, if any, date and time of the meeting of the stockholders, the record date for determining the stockholders entitled to notice of, and to vote, at the 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 meeting,
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shall be given, not less than ten (10) nor more than sixty (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 by law, the Articles of Incorporation or these Bylaws. In the case of a special meeting, the purpose or purposes for which the meeting is called also shall be set forth in the notice.
(b) Except as otherwise required by law, notice may be given by or at the direction of the Board of Directors, the Chief Executive Officer or the Secretary, in writing directed to a stockholder’s mailing address as it appears on the records of the Corporation and shall be given: (i) if mailed, when notice is deposited in the U.S. mail, postage prepaid; and (ii) if delivered by courier service, the earlier of when the notice is received or left at such stockholder’s address.
(c) So long as the Corporation is subject to the Securities and Exchange Commission’s proxy rules set forth in Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), notice shall be given in the manner required by such rules. To the extent permitted by such rules, notice may be given by electronic transmission directed to the stockholder’s electronic mail address, and if so given, shall be given when directed to such stockholder’s electronic mail address unless the stockholder has notified the Corporation in writing (including one sent by electronic transmission) of an objection to receiving notice by electronic mail or such notice is prohibited by Chapter 75 of the Nevada Revised Statutes (as amended from time to time, the “NRS”). If notice is given by electronic mail, such notice shall comply with the applicable provisions of NRS Chapter 75.
(d) Notice may be given by other forms of electronic transmission with the consent of a stockholder in the manner permitted by NRS Chapter 75 and shall be deemed given as provided therein. Any notice of a meeting by the Corporation that satisfies the requirements of NRS 78.370 pursuant to NRS 78.370(9) shall be deemed to comply in all respects with the requirements for delivery of notices under these Bylaws.
(e) An affidavit that notice has been given, executed by the Secretary, Assistant Secretary or any transfer agent or other agent of the Corporation, shall be, in the absence of fraud, prima facie evidence of the facts stated in the notice. Notice shall be deemed to have been given to all stockholders who share an address if notice is given in accordance with the “householding” rules set forth in Rule 14a-3(e) under the Exchange Act.
(f) When a meeting is adjourned to another time or place (including an adjournment taken to address a technical failure to convene or continue a meeting using remote communication), notice need not be given of the adjourned meeting if the place, if any, date and time 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: (i) announced at the meeting at which the adjournment is taken; (ii) displayed, during the time scheduled for the meeting, on the same electronic network used to enable stockholders and proxyholders to participate in the meeting by means of remote communication; or (iii) set forth in the notice of meeting given in accordance with Section 2.3(a); provided, however, that if the adjournment is to a date that is more than sixty (60) days later than the meeting date set for the original meeting, a new record date must be fixed and a notice of the adjourned meeting shall be
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given to each stockholder of record entitled to vote at the meeting. If, after the adjournment, a new record date for stockholders entitled to notice of and to vote at such adjourned meeting is fixed, the Board of Directors shall fix a new record date for such adjourned meeting in accordance with Section 7.6(a), 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 of such adjourned meeting.
(g) A determination of stockholders of record entitled to notice of and to vote at a meeting of stockholders shall apply to any postponement of the meeting; provided that the Board of Directors may fix a new record date for determination of stockholders entitled to vote at the postponed meeting, and the Board of Directors must fix a new record date if the meeting is postponed to a date more than sixty (60) days later than the date set for the original meeting.
Section 2.4 Organization.
(a) Unless otherwise determined by the Board of Directors, meetings of stockholders shall be presided over by the Chair of the Board of Directors, or in his or her absence, by the Chief Executive Officer or, in his or her absence, any other officer or director of the Corporation designated by the Board of Directors (such presiding person, the “chair of the meeting”). The Secretary, or in his or her absence, an Assistant Secretary, or in the absence of the Secretary and all Assistant Secretaries, a person whom the chair of the meeting shall appoint, shall act as secretary of the meeting and keep a record of the proceedings thereof.
(b) The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting of stockholders shall be announced at the meeting. The Board of Directors may adopt such rules and regulations for the conduct of any meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chair of the meeting shall have the authority to adopt and enforce such rules and regulations for the conduct of any meeting of stockholders and the safety of those in attendance as, in the judgment of the chair of the meeting, are necessary, appropriate or convenient for the conduct of the meeting. Such rules and regulations for the conduct of meetings of stockholders, whether adopted by the Board of Directors or the chair of the meeting, may include, without limitation: (i) an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders entitled to vote at the meeting, their duly authorized and constituted proxies, qualified representatives (including rules around who qualifies as such) and such other persons as the chair of the meeting shall permit; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; (v) limitations on the time allotted for consideration of each agenda item and for questions and comments by participants; (vi) regulation of the opening and closing of the polls for balloting and matters which are to be voted on by ballot, if any; and/or (vii) procedures, if any, that may require attendees to provide the Corporation advance notice of their intent to attend the meeting. Subject to any rules and regulations adopted by the Board of Directors, the chair of the meeting may convene and, for any or no reason, from time to time, adjourn and/or recess any meeting of stockholders pursuant to Section 2.6. The chair of the meeting, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall declare that a nomination or other business was not properly brought before the meeting if the facts warrant (including if a determination is made that a nomination or other business was not made or proposed, as the case may be, in accordance with Section 2.9 of these Bylaws), and if such chair should so declare, such nomination shall be disregarded or such other business shall not be transacted.
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Section 2.5 Quorum. Except as otherwise required by law, the Articles of Incorporation or these Bylaws, at any meeting of stockholders, the holders of a majority of the voting power of the stock outstanding and entitled to vote at the meeting, present in person or represented by proxy (regardless of whether the proxy has authority to vote on any matter), shall constitute a quorum for the transaction of business; provided, however, that where a separate vote by a class or series or classes or series is required, the holders of a majority of the voting power of the stock of such class or series or classes or series outstanding and entitled to vote on that matter, present in person or represented by proxy (regardless of whether the proxy has authority to vote on any matter), shall constitute a quorum entitled to take action with respect to such matter. If a quorum is not present or represented at any meeting of stockholders, then the chair of the meeting, or the holders of a majority of the voting power of the stock present in person or represented by proxy at the meeting and entitled to vote thereon, shall have power to adjourn or recess the meeting from time to time in accordance with Section 2.6, until a quorum is present or represented. Subject to applicable law, if a quorum is present at any meeting of stockholders, the stockholders may continue to transact business until adjournment or recess, notwithstanding the withdrawal of enough stockholders to leave less than a quorum, but unless and until a quorum is present, no business other than adjournment or recess may be transacted. Further, once a share of the Corporation’s capital stock is represented in person or by proxy (regardless of whether the proxy has authority to vote on any matter) for any purpose at a meeting, such share shall be deemed present for purposes of determining a quorum for the remainder of the meeting and for any adjournment of the meeting unless a new record date is or must be fixed for the adjourned meeting.
Section 2.6 Adjourned or Recessed Meeting. Any annual or special meeting of stockholders, whether or not a quorum is present, may be adjourned or recessed for any or no reason from time to time by the chair of the meeting, subject to any rules and regulations adopted by the Board of Directors pursuant to Section 2.4(b). Any such meeting may be adjourned for any or no reason (and may be recessed if a quorum is not present or represented) from time to time by the holders of a majority of the voting power of the stock present in person or represented by proxy at the meeting and entitled to vote thereon. At any such adjourned or recessed meeting at which a quorum is present, any business may be transacted that might have been transacted at the meeting as originally called.
Section 2.7 Voting; Proxies.
(a) Except as otherwise required by law or the Articles of Incorporation, each holder of stock of the Corporation entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of such stock held of record by such holder that has voting power upon the subject matter in question.
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(b) Except as otherwise required by law, the Articles of Incorporation, these Bylaws or any law, rule or regulation applicable to the Corporation or its securities, at each meeting of stockholders at which a quorum is present, all corporate actions to be taken by vote of the stockholders shall be authorized by the affirmative vote of at least a majority of the votes cast by stockholders present in person or represented by proxy and entitled to vote on the subject matter, and where a separate vote by a class or series or classes or series is required, if a quorum of such class or series or classes or series is present, such act shall be authorized by the affirmative vote of at least a majority of the votes cast by holders of such class or series or classes or series present in person or represented by proxy and entitled to vote on the subject matter. Voting at meetings of stockholders need not be by written ballot.
(c) Every stockholder entitled to vote for directors, or on any other matter, shall have the right to do so either in person or by one or more persons authorized to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after six months from the date of its creation, unless the proxy provides for a longer period, which may not exceed seven years from the date of its creation unless and then only for so long as such proxy is irrevocable in accordance with NRS 78.355(5). A proxy shall be irrevocable only pursuant to and in accordance with the applicable provisions of NRS 78.355. A stockholder may revoke any proxy that is not irrevocable by attending the meeting and voting in person or by delivering to the Secretary a revocation of the proxy or an executed new proxy bearing a later date.
Section 2.8 Submission of Information Regarding Director Nominees.
(a) As to each person whom a stockholder proposes to nominate for election or reelection as a director of the Corporation pursuant to Section 2.9, the stockholder must deliver to the Secretary at the principal executive offices of the Corporation the following information:
(i) a written representation and agreement (in the form to be provided by the Secretary upon written request of any stockholder of record within five (5) business days of such request), which shall be signed by the person proposed to be nominated and pursuant to which such person shall represent and agree that such person: (A) consents to being named as a nominee in a proxy statement and form of proxy relating to the meeting at which directors are to be elected and to serving as a director if elected, and currently intends to serve as a director for the full term for which such person is standing for election; (B) is not and will not become a party to any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity: (1) as to how the person, if elected as a director, will act or vote on any issue or question, except as disclosed in such representation and agreement; or (2) that could limit or interfere with the person’s ability to comply, if elected as a director, with such person’s fiduciary duties under applicable law; (C) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the Corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director or nominee, except as disclosed in such representation and agreement; and (D) if elected as a director, will comply with all of the Corporation’s corporate governance policies and guidelines related to conflict of interest, confidentiality, stock ownership and trading policies and guidelines, and any other Corporation policies and guidelines applicable to directors (which will be provided by the Secretary to such person within five (5) business days following a request therefor);
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(ii) fully completed and signed questionnaire(s) prepared by the Corporation, with respect to such proposed nominee(s) in the form to be provided by the Secretary within five (5) business days following a request therefor (the “Questionnaire(s)”); and
(iii) a proposed nominee for election or reelection as a director of the Corporation pursuant to Section 2.9 will provide to the Corporation such other information as the Corporation may reasonably request, including such information reasonably necessary for the Corporation to determine whether such proposed nominee will satisfy any qualifications, requirements or standards imposed by the Articles of Incorporation or these Bylaws, any law, rule, regulation or listing standard that may be applicable to the Corporation, or relevant to a determination whether such person can be considered an independent director of the Corporation.
(b) If a stockholder has submitted notice of an intent to nominate a candidate for election or re-election as a director pursuant to Section 2.9, all written and signed representations and agreements and all fully completed and signed Questionnaires described in Section 2.8(a) shall be provided to the Corporation at the same time as such notice for the notice to be considered timely, and the additional information described in Section 2.8(a)(iii) shall be provided to the Corporation promptly upon request by the Corporation, but in any event within five (5) business days after such request (or by the day prior to the day of the annual meeting, if earlier). All information provided pursuant to this Section 2.8 shall be deemed part of the stockholder’s notice submitted pursuant to Section 2.9.
(c) Notwithstanding the foregoing, if any information or communication submitted pursuant to this Section 2.8 is inaccurate or incomplete in any material respect (as determined by the Board of Directors (or any authorized committee thereof)) in good faith, such information shall be deemed not to have been provided in accordance with this Section 2.8.
Section 2.9 Notice of Stockholder Business and Nominations.
(a) Annual Meeting.
(i) Nominations of persons for election to the Board of Directors and the proposal of business other than nominations to be considered by the stockholders may be made at an annual meeting of stockholders only: (A) pursuant to the Corporation’s notice of meeting or any supplement thereto; (B) by or at the direction of the Board of Directors or any authorized committee thereof; or (C) by any stockholder of the Corporation who is a stockholder of record at the time the notice provided for in this Section 2.9(a) is delivered to the Secretary, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this Section 2.9(a). For the avoidance of doubt, the foregoing clause (C) shall be the exclusive means for a stockholder to make director nominations or propose other business at an annual meeting of stockholders (other than a proposal included in the Corporation’s proxy statement pursuant to and in compliance with Rule 14a-8 under the Exchange Act).
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(ii) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to Section 2.9(a)(i)(C), the stockholder must have given timely notice thereof in writing to the Secretary and, in the case of business other than nominations, such business must be a proper subject for stockholder action under applicable law. To be timely, a stockholder’s notice must be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business (as defined in Section 2.9(c)(iii)) on the ninetieth (90th) day nor earlier than the close of business on the one hundred twentieth (120th) day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after such anniversary date, or if no annual meeting was held or deemed to have been held in the preceding year, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the date on which public announcement (as defined in Section 2.9(c)(iii)) of the date of such meeting is first made by the Corporation. In no event shall an adjournment or recess of an annual meeting, or a postponement of an annual meeting for which notice of the meeting has already been given to stockholders or a public announcement of the meeting date has already been made, or a public announcement of any of the foregoing, commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above. A stockholder’s notice given in accordance with this Section 2.9 must contain the names of only the nominees for whom such stockholder (or beneficial owner, if any) intends to solicit proxies and any substitute nominees in the event any such nominee is unable to serve or for good cause will not serve; provided that a stockholder shall not be entitled to make or designate substitute nominees following the expiration of the time periods set forth in this Section 2.9(a); and in the event that a stockholder’s notice includes one or more such substitute nominees, such stockholder must provide timely notice of such substitute nominee(s) in accordance with the provisions of Section 2.8 and this Section 2.9 (including, without limitation, satisfaction of all applicable informational requirements set forth therein). For the avoidance of doubt, the number of nominees a Proposing Stockholder may nominate for election at the annual meeting shall not exceed the number of directors to be elected at such annual meeting. Such stockholder’s notice shall set forth:
(A) as to each person whom the stockholder proposes to nominate for election or re-election as a director:
(1) a written statement, not to exceed 500 words, in support of such person;
(2) all information relating to such person that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required, in each case pursuant to and in accordance with Regulation 14A under the Exchange Act; and
(3) the information and documents required to be submitted regarding nominees pursuant to Section 2.8, including within the time periods specified in Section 2.8(c);
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(B) as to any other business that the stockholder proposes to bring before the meeting, (1) a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such business includes a proposal to amend the Bylaws of the Corporation, the language of the proposed amendment), and the reasons for conducting such business at the meeting and (2) any substantial interest (within the meaning of Item 5 of Schedule 14A under the Exchange Act) in such business of such Proposing Stockholder (as defined below) , and if such Proposing Stockholder is an entity, any control person (as defined below);
(C) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made or the other business is proposed:
(1) the name and address of such stockholder, as they appear on the Corporation’s books, and the name and address of such beneficial owner;
(2) the class or series and number of shares of stock of the Corporation which are owned of record by such stockholder and such beneficial owner ; and
(3) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and the stockholder (or a qualified representative of the stockholder) intends to appear in person or by proxy at the meeting to make such nomination or propose such business; and
(D) as to the stockholder giving the notice or, if the notice is given on behalf of a beneficial owner on whose behalf the nomination is made or the other business is proposed, as to such beneficial owner (such stockholder or beneficial owner, a “Proposing Stockholder”), and if such Proposing Stockholder is an entity, as to each individual who is a director, executive officer (as defined in Rule 3b-7 under the Exchange Act), general partner or managing member of such entity or of any other entity that has or shares control of such entity (any such individual or entity, a “control person”):
(1) the class or series and number of shares of stock of the Corporation which are beneficially owned (as defined in Section 2.9(c)(iii)) by the Proposing Stockholder and by any control person;
(2) a description (which description shall include, in addition to all other information described in this clause (2), information identifying all parties thereto) of (x) any plans or proposals that such Proposing Stockholder or control person may have with respect to securities of the Corporation that would be required to be disclosed pursuant to Item 4 of the Exchange Act Schedule 13D and (y) any agreement, arrangement or understanding with respect to the nomination or other proposed business between or among the Proposing Stockholder or control person and any other person, including, without limitation, any agreements that would be required to be disclosed pursuant to Item 5 or Item 6 of the Exchange Act Schedule 13D (in the case of either clause (x) or (y), regardless of whether the requirement to file a Schedule 13D is applicable);
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(3) a description (which description shall include, in addition to all other information described in this clause (3), information identifying all parties thereto) of any instrument, agreement, arrangement or understanding (including, without limitation, any option, warrant, forward contract, swap, contract of sale, or other derivative or similar agreement or short positions, profit interests, convertible securities, stock appreciation or similar rights, hedging or pledging transactions, voting rights, dividend rights, and/or borrowing or lending of shares), whether such agreement, arrangement or understanding (or instrument evidencing the foregoing) is to be settled with shares or with cash based on the notional amount or value of outstanding shares of stock, that has been entered into by, or on behalf of, such Proposing Stockholder, or any control person, the effect or intent of which is to (x) mitigate loss to, or to manage the risk or benefit from changes in the share price of any class or series of the Corporation’s stock or (y) maintain, increase or decrease the voting power of the Proposing Stockholder or control person with respect to securities of the Corporation;
(4) a representation as to whether such Proposing Stockholder, control person or any other participant (as defined in Item 4 of Schedule 14A under the Exchange Act) will engage in a solicitation with respect to such nomination or proposal and, if so, the name of each participant in such solicitation, and whether such solicitation will be conducted as an exempt solicitation under Rule 14a-2(b) of the Exchange Act, and (x) in the case of a proposal of business other than nominations, whether such person or group intends to deliver a proxy statement and form of proxy through means satisfying each of the conditions that would be applicable to the Corporation under either Rule 14a-16(a) under the Exchange Act or Rule 14a-16(n) under the Exchange Act, to holders of at least the percentage of the Corporation’s voting shares required under applicable law to carry the proposal, or (y) in the case of any non-exempt solicitation that is subject to Rule 14a-19 of the Exchange Act, confirming that such person or group will deliver, through means satisfying each of the conditions that would be applicable to the Corporation under either Exchange Act Rule 14a-16(a) or Exchange Act Rule 14a-16(n), a proxy statement and form of proxy to holders of at least sixty-seven percent (67%) of the voting power of the Corporation’s stock entitled to vote generally in the election of directors (for purposes of this clause (4), the term “holders” shall include, in addition to stockholders of record, any beneficial owners pursuant to Rule 14b-1 and Rule 14b-2 of the Exchange Act); and
(5) a representation that promptly after a solicitation is made to the holders of the Corporation’s stock referred to in the representation required under clause (a)(ii)(D)(4) of this Section 2.9, and in any event no later than the tenth (10th) day before such meeting of stockholders, such Proposing Stockholder will provide the Corporation with documents, which may take the form of a certified statement and documentation from a proxy solicitor, specifically demonstrating that the necessary steps have been taken to deliver a proxy statement and form of proxy to holders of such percentage of the Corporation’s stock entitled to vote generally in the election of directors.
(iii) In addition, to be in proper written form, a stockholder’s notice to the Secretary must be updated and supplemented, and such update and supplement must be delivered to the Secretary, to disclose the information contained in Section 2.9(a)(ii)(C)(2) and Section 2.9(a)(ii)(D)(1)-(3) as of the record date for the meeting, not later than five (5) business days following the record date for such meeting.
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(iv) Notwithstanding anything in this Section 2.9(a) to the contrary, if any information or communication submitted pursuant to this Section 2.9 is inaccurate or incomplete in any material respect (as determined by the Board of Directors (or any authorized committee thereof)) in good faith, such information shall be deemed not to have been provided in accordance with this Section 2.9. For the avoidance of doubt, the obligation to update and supplement as set forth in Section 2.8, this Section 2.9 or any other section of these Bylaws shall not limit the Corporation’s rights with respect to any deficiencies in any notice provided by a stockholder, extend any applicable deadlines hereunder or under any other provision of these Bylaws or enable or be deemed to permit a stockholder who has previously submitted notice hereunder or under any other provision of these Bylaws to amend or update any nomination or other business proposal or to submit any new nomination or other business proposal, including by changing or adding nominees, matters, business and or resolutions proposed to be brought before a meeting of stockholders.
(v) Notwithstanding anything in Section 2.9(a)(ii) or Section 2.9(b) to the contrary, if the record date for determining the stockholders entitled to vote at any meeting of stockholders is different from the record date for determining the stockholders entitled to notice of the meeting, a stockholder’s notice required by this Section 2.9 shall set forth a representation that the stockholder will notify the Corporation in writing within five (5) business days after the record date for determining the stockholders entitled to vote at the meeting, or by the opening of business on the date of the meeting (whichever is earlier), of the information required under this Section 2.9(a), and such information when provided to the Corporation shall be current as of the record date for determining the stockholders entitled to vote at the meeting.
(vi) This Section 2.9(a) shall not apply to a proposal proposed to be made by a stockholder if the stockholder has notified the Corporation of his or her intention to present the proposal at an annual or special meeting only pursuant to and in compliance with Rule 14a-8 under the Exchange Act and such proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such meeting.
(vii) Notwithstanding anything in this Section 2.9(a) to the contrary, in the event that the number of directors to be elected to the Board of Directors at an annual meeting is increased and there is no public announcement by the Corporation naming all of the nominees proposed by the Board of Directors to be elected at such meeting or specifying the size of the increased Board of Directors made by the Corporation at least ten (10) days prior to the last day a stockholder may deliver a notice in accordance with Section 2.9(a)(ii), a stockholder’s notice required by this Section 2.9(a) shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the tenth (10th) day following the day on which such public announcement is first made by the Corporation.
(b) Special Meeting. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting (or any supplement thereto). Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the Corporation’s notice of meeting: (i) by or at the direction of the Board of Directors (or any authorized committee thereof); or (ii) provided that the Board of Directors has determined that one or more directors are to be elected at such meeting, by any stockholder of the Corporation who: (x) is a stockholder of record at the time the
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notice provided for in this Section 2.9(b) is delivered to the Secretary, who is entitled to vote at the meeting and upon such election, and (y) who delivers a timely notice thereof in writing to the Secretary setting forth the information required by Section 2.9(a) above and provides the additional information required by Section 2.8 above. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the Board of Directors, any stockholder entitled to vote in such election of directors may nominate a person or persons (as the case may be) for election to such position(s) as specified in the Corporation’s notice of meeting, if the notice required by this Section 2.9(b) shall be delivered to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the one-hundred twentieth (120th) day prior to such special meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such special meeting or the tenth (10th) day following the date on which public announcement of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting is first made by the Corporation. A stockholder’s notice given in accordance with this Section 2.9(b) must contain the names of only the nominees for whom such stockholder (or beneficial owner, if any) intends to solicit proxies and any substitute nominees; provided that a stockholder shall not be entitled to make or designate substitute nominees following the expiration of the time periods set forth in this Section 2.9(b), and in the event that a stockholder’s notice includes one or more substitute nominees, such stockholder must provide timely notice of such substitute nominee(s) in accordance with the provisions of this Section 2.9(b) (including, without limitation, satisfaction of all applicable informational requirements set forth in Section 2.8 and Section 2.9(a)). For the avoidance of doubt, the number of nominees a Proposing Stockholder may nominate for election at the special meeting shall not exceed the number of directors to be elected at such special meeting. In no event shall an adjournment, recess or postponement of a special meeting (or a public announcement thereof) commence a new time period (or extend any time period) for the giving of a stockholder’s notice as described above.
(c) General.
(i) Except as otherwise required by law, only such persons who are nominated in accordance with the procedures set forth in this Section 2.9 shall be eligible to be elected at any meeting of stockholders of the Corporation to serve as directors and only such other business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 2.9. Notwithstanding any other provision of these Bylaws, a Proposing Stockholder and any control person) shall also comply with applicable law, including, without limitation, the applicable requirements of the Exchange Act and the rules and regulations promulgated thereunder with respect to the matters set forth in this Section 2.9; provided, however, that any references in these Bylaws to the Exchange Act or the rules and regulations promulgated thereunder are not intended to and shall not limit any requirements applicable to nominations or proposals as to any other business to be considered pursuant to this Section 2.9. Except as otherwise provided by law, the Board of Directors (or an authorized committee thereof), or, at any meeting of stockholders, the chair of the meeting or any other person designated by the Board of Directors (subject to the supervision, discretion and control of the Board) shall determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 2.9 (including whether a nominee or Proposing Stockholder provided all information and complied with all representations required
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under Section 2.8 or complied with the requirements of Rule 14a-19 under the Exchange Act). If any proposed nomination or other business is not in compliance with this Section 2.9, including due to a failure to comply with the requirements of Rule 14a-19 under the Exchange Act, then except as otherwise required by law, the Board of Directors (or an authorized committee thereof), or, at any meeting of stockholders, the chair of the meeting (subject to the supervision, discretion and control of the Board of Directors) shall have the power and authority to declare that such nomination shall be disregarded or that such other business shall not be transacted, notwithstanding that proxies and votes in respect of any such nomination or other business may have been received by the Corporation. In furtherance of and not by way of limitation of the foregoing provisions of this Section 2.9, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or other business, such nomination shall be disregarded or such other business shall not be transacted, notwithstanding that proxies and votes in respect of such nomination or other business may have been received by the Corporation.
(ii) To be considered a qualified representative of a stockholder for purposes of these Bylaws, a person must be a duly authorized officer, manager or partner of such stockholder or authorized by a writing executed by such stockholder (or a reliable reproduction or electronic transmission of the writing) delivered to the Corporation prior to the making of such nomination or proposal at such meeting (and in any event not fewer than five (5) business days before the meeting) stating that such person is authorized to act for such stockholder as proxy at the meeting of stockholders.
(iii) For purposes of this Section 2.9, the “close of business” shall mean 6:00 p.m. local time at the principal executive offices of the Corporation on any calendar day, whether or not the day is a business day, and a “public announcement” shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act. For purposes of Section 2.9(a)(ii)(D)(1), shares shall be treated as “beneficially owned” by a person if the person beneficially owns such shares, directly or indirectly, for purposes of Section 13(d) of the Exchange Act and Regulations 13D and 13G thereunder or has or shares pursuant to any agreement, arrangement or understanding (whether or not in writing): (A) the right to acquire such shares (whether such right is exercisable immediately or only after the passage of time or the fulfillment of a condition or both); (B) sole or shared right to vote such shares; provided, however, that a person shall not be deemed to beneficially own such shares if the right to vote such shares arises solely from a revocable proxy or consent given to such person in response to a public proxy or consent solicitation made pursuant to and in accordance with applicable rules and regulations promulgated under the Exchange Act; and/or (C) sole or shared investment power with respect to such shares, including the power to dispose of, or to direct the disposition of, such shares.
(iv) Nothing in this Section 2.9 shall be deemed to affect any rights (A) of stockholders to request inclusion of proposals in the Corporation’s proxy statement pursuant to Rule 14a-8 promulgated under the Exchange Act or (B) of the holders of any series of Preferred Stock to elect directors pursuant to any applicable provisions of the Articles of Incorporation.
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(v) Any stockholder directly or indirectly soliciting proxies from other stockholders must use a proxy card color other than white, which shall be reserved for the exclusive use for solicitation by the Board of Directors.
Section 2.10 No Action by Written Consent. Except as otherwise provided for or fixed pursuant to the Articles of Incorporation, no action that is required or permitted to be taken by the stockholders of the Corporation may be effected by consent of stockholders in lieu of a meeting of stockholders.
Section 2.11 Inspectors of Election. Before any meeting of stockholders, the Corporation may, and shall if required by law, appoint one or more inspectors of election to act at the meeting and make a written report thereof. Inspectors may be employees of the Corporation. The Corporation may designate one or more persons as 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 chair of the meeting may, and shall if required by law, 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. Inspectors need not be stockholders. No director or nominee for the office of director at an election shall be appointed as an inspector at such election. Such inspectors shall:
(a) determine the number of shares outstanding and the voting power of each, the number of shares represented at the meeting, the existence of a quorum, and the validity of proxies and ballots;
(b) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors;
(c) count and tabulate all votes and ballots; and
(d) certify their determination of the number of shares represented at the meeting, and their count of all votes and ballots.
Section 2.12 Meetings by Remote Communications. The Board of Directors may, in its sole discretion, determine that a meeting of stockholders shall not be held at any physical location, but may instead be held solely by means of remote communication in accordance with NRS 78.320(4)-(6). If authorized by the Board of Directors in its sole discretion, and subject to such guidelines and procedures as the Board of Directors may adopt, stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication: (a) participate in a meeting of stockholders; and (b) be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated physical location or solely by means of remote communication, provided that: (i) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder; (ii) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings; and (iii) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.
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Section 2.13 Delivery to the Corporation. Whenever this Article II requires one or more persons (including a stockholder of record or a beneficial owner of stock) to deliver a document or information (other than a document authorizing another person to act for a stockholder by proxy at a meeting of stockholders pursuant to NRS 78.355) to the Corporation or any officer, employee or agent thereof (including any notice, request, questionnaire, revocation, representation or other document or agreement), the Corporation shall not be required to accept delivery of such document or information unless the document or information is in a writing in physical form exclusively (and not in an electronic record) and delivered exclusively by hand (including, without limitation, overnight courier service) or by certified or registered mail, return receipt requested. For the avoidance of doubt, the Corporation expressly opts out of NRS 75.150 with respect to the delivery of information and documents (other than a document authorizing another person to act for a stockholder by proxy at a meeting of stockholders pursuant to NRS 78.355) to the Corporation required by this Article II.
ARTICLE III
DIRECTORS
Section 3.1 Powers. Except as otherwise required by the NRS or as provided in the Articles of Incorporation, the business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authorities these Bylaws expressly confer upon it, the Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by law, the Articles of Incorporation or these Bylaws required to be exercised or done by the stockholders.
Section 3.2 Number, Classification, Term of Office and Election. Except as otherwise provided for or fixed pursuant to the Articles of Incorporation, the Board of Directors shall consist of such number of directors as shall be determined from time to time solely by resolution of a majority of the directors then in office. The directors shall hold office in the manner provided in the Articles of Incorporation, and if so provided in the Articles of Incorporation, the directors shall be classified in the manner so provided. At any meeting of stockholders at which directors are to be elected, directors shall be elected by a plurality of the votes cast. Directors need not be stockholders unless so required by the Articles of Incorporation or these Bylaws, wherein other qualifications for directors may be prescribed.
Section 3.3 Vacancies and Newly Created Directorships. Subject to the rights of the holders of any outstanding series of Preferred Stock, and unless otherwise required by law, newly created directorships resulting from any increase in the authorized number of directors and any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification, removal from office or other reason shall be filled solely by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum, or by the sole remaining director, and any director so chosen shall hold office until the next election of the class for which such director shall have been chosen and until his or her successor shall have been duly elected and qualified. No decrease in the authorized number of directors shall shorten the term of any incumbent director.
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Section 3.4 Resignations and Removal.
(a) Any director may resign at any time upon notice given in a writing (including one sent by electronic transmission) to the Board of Directors, the Chair of the Board of Directors or the Secretary. Such resignation shall take effect upon delivery, unless the resignation specifies a later effective date or time or an effective date or time determined upon the happening of an event or events. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
(b) Any director, or the entire Board of Directors, may be removed from office at any time, but only pursuant to and in accordance with the applicable provisions of the Articles of Incorporation and the NRS.
Section 3.5 Regular Meetings. Regular meetings of the Board of Directors shall be held at such physical location, if any, within or without the State of Nevada, by such means of remote communication, if any, on such date and at such time, 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 3.6 Special Meetings. Special meetings of the Board of Directors for any purpose or purposes may be called at any time by the Chair of the Board of Directors, the Chief Executive Officer (if separate and serving as a director) or a majority of the directors then in office. The person or persons authorized to call special meetings of the Board of Directors may fix the physical location, if any, within or without the State of Nevada, the means of remote communication, if any, and the date and time of such meetings. Notice of each such meeting shall be given to each director, if by mail, addressed to such director at his or her residence or usual place of business, at least five (5) days before the day on which such meeting is to be held, or shall be sent to such director by electronic transmission, or by personal delivery or by telephone, in each case at least twenty-four (24) hours prior to the time set for such meeting. A notice of special meeting need not state the purpose of such meeting, and, unless indicated in the notice thereof, any and all business may be transacted at a special meeting.
Section 3.7 Remote Participation in Meeting. 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 any other remote communication permitted under the NRS, and such participation shall constitute presence in person at such meeting.
Section 3.8 Quorum and Voting. Except as otherwise required by law, the Articles of Incorporation or these Bylaws, a majority of the total number of directors then in office shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, and the approval by a majority of the votes entitled to be cast by the directors present at a duly held meeting at which a quorum is present shall be the act of the Board of Directors. The chair of the meeting or a majority of the directors present may adjourn the meeting to another time and place whether or not a quorum is present. At any adjourned meeting at which a quorum is present, any business may be transacted that might have been transacted at the meeting as originally called.
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Section 3.9 Board of Directors Action by Written Consent Without a Meeting. Unless otherwise restricted by the Articles of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors, or any committee thereof, may be taken without a meeting, provided that, except and only to the extent otherwise permitted under NRS 78.315(2), all members of the Board of Directors or committee, as the case may be, consent in writing (including one sent by electronic transmission) to such action. After an action is taken, the consent or consents relating thereto shall be filed with the minutes or proceedings of the Board of Directors or committee in the same paper or electronic form as the minutes are maintained.
Section 3.10 Chair of the Board of Directors. The Chair of the Board of Directors shall preside at meetings of stockholders in accordance with Section 2.4(a) and at meetings of directors and shall perform such other duties as the Board of Directors may from time to time determine. If the Chair of the Board of Directors is not present at a meeting of the Board of Directors, the Chief Executive Officer (if separate and serving as a director) or another director chosen by or in the manner provided by the Board of Directors shall preside.
Section 3.11 Rules and Regulations. The Board of Directors may adopt such rules and regulations not inconsistent with the provisions of law, the Articles of Incorporation or these Bylaws for the conduct of its meetings and management of the affairs of the Corporation as the Board of Directors shall deem proper.
Section 3.12 Fees and Compensation of Directors. Unless otherwise restricted by the Articles of Incorporation, the Board of Directors, without regard to personal interest, may establish the compensation of directors for services in any capacity pursuant to and in accordance with NRS 78.140(5). If the Board of Directors so establishes the compensation of directors, such compensation is presumed to be fair to the corporation unless proven unfair by a preponderance of the evidence.
ARTICLE IV
COMMITTEES
Section 4.1 Committees of the Board of Directors. The Board of Directors may designate one or more committees, provided that each such committee must have among its members at least one director of the Corporation. The Board of Directors may designate one or more directors as alternate members of any committee to replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent permitted by law and provided in the resolution of the Board of Directors establishing such committee, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation (if any) to be affixed to all papers that may require it. All committees of the Board of Directors shall keep minutes of their meetings and shall report their proceedings to the Board of Directors when requested or required by the Board of Directors.
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Section 4.2 Meetings and Action of Committees. Unless the Board of Directors provides otherwise by resolution, any committee of the Board of Directors may adopt, alter and repeal such rules and regulations not inconsistent with the provisions of law, the Articles of Incorporation or these Bylaws for the conduct of its meetings as such committee may deem proper. A majority of the members then serving on a committee shall constitute a quorum for the transaction of business by the committee except as otherwise required by law, the Articles of Incorporation or these Bylaws, and except as otherwise provided in a resolution of the Board of Directors; provided, however, that in no case shall a quorum be less than one-third of the members then serving on the committee, one of whom must be a director of the Corporation. Unless the Articles of Incorporation, these Bylaws or a resolution of the Board of Directors requires a greater number, the vote of a majority of the members of a committee present at a meeting at which a quorum is present shall be the act of the committee.
ARTICLE V
OFFICERS
Section 5.1 Officers. The officers of the Corporation shall include a Chief Executive Officer (who shall serve as President unless the Board of Directors appoints another person to serve in such role), a Chief Financial Officer (who shall serve as Treasurer unless the Board of Directors appoints another person to serve in such role), and a Secretary, each of whom shall be elected by the Board of Directors. The Corporation may have such other officers as the Board of Directors or the Chief Executive Officer or another authorized officer may determine and appoint from time to time. Officers shall have such authority, functions or duties as set forth in these Bylaws or as determined by the Board of Directors or the Chief Executive Officer or another authorized officer. Each officer shall hold office until such person’s successor shall have been duly elected and qualified, or until such person’s earlier death, disqualification, resignation or removal. Any number of offices may be held by the same person. The Board of Directors may determine to leave any office vacant.
Section 5.2 Additional Positions and Titles. The Corporation may have “assistant officers”, with such powers and duties as the Board of Directors, or the Chief Executive Officer or another authorized officer may from time to time determine. Any officer or employee may be assigned any additional title, with such powers and duties, as the Board of Directors or an authorized officer may from time to time determine. Any persons appointed as assistant officers, and any persons upon whom such titles are conferred, shall not be deemed officers of the Corporation unless appointed by the Board of Directors or the Chief Executive Officer pursuant to Section 5.1.
Section 5.3 Compensation. The salaries of the officers of the Corporation shall be fixed from time to time by the Board of Directors or by any person or persons to whom the Board of Directors has delegated such authority.
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Section 5.4 Removal, Resignation and Vacancies. Any officer of the Corporation, or any assistant officer, may be removed, with or without cause, by the Board of Directors or an authorized officer. Any officer or assistant officer of the Corporation appointed by the Chief Executive Officer or another authorized officer also may be removed by the Chief Executive Officer or other officer authorized to appoint such officer or assistant officer. Any officer may resign at any time upon notice given in writing (including one sent by electronic transmission) to the Corporation. Any resignation or removal shall be without prejudice to the rights, if any, of such officer under any contract to which such officer is a party. Any vacancy occurring in any office of the Corporation may be filled in accordance with Section 5.1 or Section 5.2, as applicable, or such office may be left vacant.
Section 5.5 Chief Executive Officer. The Chief Executive Officer shall have general supervision and direction of the business and affairs of the Corporation, shall be responsible for corporate policy and strategy, and shall report directly to the Board of Directors.
Section 5.6 Chief Financial Officer. The Chief Financial Officer shall exercise all the powers and perform the duties of the office of the Chief Financial Officer and in general have overall supervision of the financial operations of the Corporation. The Chief Financial Officer shall perform such other duties as the Board of Directors or the Chief Executive Officer may from time to time determine.
Section 5.7 Secretary. The powers and duties of the Secretary shall include acting as Secretary at all meetings of the Board of Directors, of the committees of the Board of Directors and of the stockholders, and performing all other duties incident to the office of Secretary. The Secretary shall perform such other duties as the Board of Directors, the Chief Executive Officer or another authorized officer may from time to time determine.
Section 5.8 Authority and Duties of Officers. The Chief Executive Officer, Chief Financial Officer, and the Secretary shall have such authority, functions or duties as set forth in these Bylaws or as determined by the Board of Directors. Other officers shall have such authority, functions or duties as set forth in these Bylaws or as determined by the Board of Directors, the Chief Executive Officer or another officer authorized to prescribe the duties of such officer. To the extent not so set forth or determined, each such officer shall have such authority, functions or duties as those that generally pertain to their respective offices, subject to the control of the Board of Directors. Unless otherwise determined by the Board of Directors or otherwise provided by law or these Bylaws, contracts, evidences of indebtedness and other instruments or documents of the Corporation may be executed, signed or endorsed: (i) by the Chief Executive Officer; or (ii) by other officers of the Corporation, in each case only with regard to such instruments or documents that pertain to or relate to such person’s duties or business functions.
Section 5.9 Action with Respect to Securities of Other Corporations or Entities. The Chief Executive Officer, or any other person or persons to whom the Board of Directors or the Chief Executive Officer has delegated such authority, is authorized to vote, represent, and exercise on behalf of the Corporation all rights incident to any and all shares or other equity interests of any other corporation or entity standing in the name of the Corporation. The authority herein granted may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by the person having such authority.
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Section 5.10 Delegation. The Board of Directors or an officer authorized by the Board of Directors may from time to time delegate the powers or duties of any officer to any other officers or agents, notwithstanding the foregoing provisions of this Article V.
ARTICLE VI
INDEMNIFICATION AND ADVANCEMENT OF EXPENSES
Section 6.1 Right to Indemnification.
(a) Each person who was or is a party or is threatened to be made a party to, or was or is otherwise involved in, any action, suit, arbitration, alternative dispute resolution mechanism, investigation, inquiry, judicial, administrative or legislative hearing, or any other threatened, pending or completed proceeding, whether brought by or in the right of the Corporation or otherwise, including any and all appeals, whether of a civil, criminal, administrative, legislative, investigative or other nature (hereinafter a “proceeding”), by reason of the fact that he or she is or was a director or an officer of the Corporation or while a director or an officer of the Corporation is or was serving at the request of the Corporation as a director, officer, manager, employee, agent or trustee of another corporation or of a partnership, limited liability company, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter an “indemnitee”), or by reason of anything done or not done by him or her in any such capacity, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the NRS, as the same exists or may hereafter be amended, against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes, penalties and amounts paid in settlement by or on behalf of the indemnitee) actually and reasonably incurred by such indemnitee in connection therewith, all on the terms and conditions set forth in these Bylaws; provided, however, that, except as otherwise required by law or provided in Section 6.4 with respect to suits to enforce rights under this Article VI, the Corporation shall indemnify any such indemnitee in connection with a proceeding, or part thereof, voluntarily initiated by such indemnitee (including claims and counterclaims, whether such counterclaims are asserted by: (i) such indemnitee; or (ii) the Corporation in a proceeding initiated by such indemnitee) only if such proceeding, or part thereof, was authorized or ratified by the Board of Directors or the Board of Directors otherwise determines that indemnification or advancement of expenses is appropriate.
(b) Any reference to an officer of the Corporation in this Article VI shall be deemed to refer exclusively to the Chief Executive Officer, Chief Financial Officer and Secretary and any officer of the Corporation (1) appointed by the Board of Directors pursuant to Section 5.1 or (2) designated by the Board of Directors as such for purposes of Section 16 of the Exchange Act, and any reference to an officer of any other enterprise shall be deemed to refer exclusively to an officer appointed by the board of directors or equivalent governing body of such other enterprise pursuant to the articles of incorporation and bylaws (or equivalent organizational documents) of such other enterprise. The fact that any person who is or was an employee of the Corporation or an employee of any other enterprise has been given or has used the title of “Vice President” or any other title that could be construed to suggest or imply that such person is or may be an officer of the Corporation or of such other enterprise shall not, by itself, result in such person being constituted as, or being deemed to be, an officer of the Corporation or of such other enterprise for purposes of this Article VI.
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Section 6.2 Right to Advancement of Expenses.
(a) In addition to the right to indemnification conferred in Section 6.1, an indemnitee shall, to the fullest extent permitted by law, also have the right to be paid by the Corporation the expenses (including attorneys’ fees) incurred in defending any proceeding in advance of its final disposition (hereinafter an “advancement of expenses”); provided, however, that an advancement of expenses 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 of a court of competent jurisdiction 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 Article VI or otherwise.
(b) Notwithstanding the foregoing Section 6.2(a), the Corporation shall not make or continue to make advancements of expenses to an indemnitee if a determination is reasonably made that the facts known at the time such determination is made demonstrate clearly and convincingly that the indemnitee acted in bad faith or in a manner that the indemnitee did not reasonably believe to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal proceeding, that the indemnitee had reasonable cause to believe his or her conduct was unlawful. Such determination shall be made: (i) by the Board of Directors by a majority vote of directors who are not parties to such proceeding, whether or not such majority constitutes a quorum; (ii) by a committee of such directors designated by a majority vote of such directors, whether or not such majority constitutes a quorum; or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to the indemnitee.
Section 6.3 Indemnification for Successful Defense. To the extent that an indemnitee has been successful on the merits or otherwise in defense of any proceeding (or in defense of any claim, issue or matter therein), such indemnitee shall be indemnified under this Section 6.3 against expenses (including attorneys’ fees) actually and reasonably incurred in connection with such defense. Indemnification under this Section 6.3 shall not be subject to satisfaction of a standard of conduct, and the Corporation may not assert the failure to satisfy a standard of conduct as a basis to deny indemnification or recover amounts advanced, including in a suit brought pursuant to Section 6.4 (notwithstanding anything to the contrary therein).
Section 6.4 Right of Indemnitee to Bring Suit. If a request for indemnification under Section 6.1 or Section 6.3 is not paid in full by the Corporation within sixty (60) days, or if a request for an advancement of expenses under Section 6.2 is not paid in full by the Corporation within twenty (20) days, after a written request has been received by the Secretary, the indemnitee may at any time thereafter bring suit against the Corporation in a court of competent jurisdiction in the State of Nevada seeking an adjudication of entitlement to such indemnification or advancement of expenses. 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
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undertaking, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such suit to the fullest extent permitted by law. In any suit brought by the indemnitee to enforce a right to indemnification hereunder it shall be a defense that the indemnitee has not met any applicable standard of conduct for indemnification set forth in NRS 78.7502 or 78.751, as applicable. Further, 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 of conduct for indemnification set forth in NRS 78.751. 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 any applicable standard of conduct, 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 any such applicable standard of conduct, shall create a presumption that the indemnitee has not met such applicable standard(s) 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 applicable law, this Article VI or otherwise, shall be on the Corporation.
Section 6.5 Non-Exclusivity of Rights. The rights to indemnification and to the advancement of expenses conferred in this Article VI shall not be exclusive of any other right that any person may have or hereafter acquire under any law, agreement, vote of stockholders or disinterested directors, provisions of the Articles of Incorporation or Bylaws, or otherwise.
Section 6.6 Insurance. 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 NRS.
Section 6.7 Indemnification of Employees and Agents of the Corporation; Service at Subsidiaries. The Corporation may, to the extent and in the manner permitted by law, and to the extent authorized from time to time, grant rights to indemnification and to the advancement of expenses to any employee or agent of the Corporation. Any person serving as a director, manager or officer of a subsidiary of the Corporation shall be entitled to the rights to indemnification conferred in this Article VI, and to the advancement of expenses, as defined in Section 6.2, with respect to his or her service at such subsidiary; provided, however, that the advancement of expenses to any person who is not an indemnitee as defined in Section 6.1(a) shall be at the discretion of the Corporation. Any director, manager or officer of a subsidiary is deemed to be serving such subsidiary at the request of the Corporation, and the Corporation is deemed to be requesting such service. This Article VI shall, to the fullest extent permitted by law, supersede any conflicting provisions contained in the governance documents of any other subsidiary of the Corporation. In addition, the Corporation may, to the extent and in the manner permitted by law, and to the extent authorized from time to time, grant rights to indemnification and to the advancement of expenses to individuals with respect to their service as an employee or agent of subsidiaries of the Corporation.
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Section 6.8 Nature of Rights. The rights conferred upon indemnitees in this Article VI shall be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director or officer and shall inure to the benefit of the indemnitee’s heirs, executors and administrators. Any amendment, alteration or repeal of this Article VI that adversely affects any right of an indemnitee or its successors shall be prospective only and shall not limit or eliminate 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.
Section 6.9 Settlement of Claims. To the fullest extent permitted by law and notwithstanding anything in this Article VI to the contrary, the Corporation shall not be liable to indemnify any indemnitee under this Article VI for any amounts paid in settlement of any proceeding effected without the Corporation’s written consent, which consent shall not be unreasonably withheld.
Section 6.10 Subrogation. In the event of payment under this Article VI, the Corporation shall be subrogated to the extent of such payment to all of the rights of recovery of the indemnitee (excluding insurance obtained on the indemnitee’s own behalf), and the indemnitee shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Corporation effectively to bring suit to enforce such rights.
Section 6.11 Severability. If any provision or provisions of this Article VI 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: (a) the validity, legality and enforceability of such provision in any other circumstance and of the remaining provisions of this Article VI (including, without limitation, all portions of any paragraph of this Article VI containing any such provision held to be invalid, illegal or unenforceable, that are not by themselves invalid, illegal or unenforceable) and the application of such provision to other persons or entities or circumstances shall not in any way be affected or impaired thereby; and (b) to the fullest extent possible, the provisions of this Article VI (including, without limitation, all portions of any paragraph of this Article VI containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent of the parties that the Corporation provide protection to the indemnitee to the fullest extent set forth in this Article VI.
ARTICLE VII
CAPITAL STOCK
Section 7.1 Certificates of Stock. The shares of the Corporation shall be represented by certificates; provided, however, that the Board of Directors may provide by resolution or resolutions that some or all of any or all classes or series of 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. Every holder of stock represented by certificates shall be entitled to have a certificate signed by or in the name of the Corporation by any two authorized
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officers of the Corporation, including, without limitation, the Chief Executive Officer, the President (if any), the Chief Financial Officer, the Treasurer (if any), the Controller (if any), the Secretary, or any Assistant Treasurer or Assistant Secretary certifying the number of shares owned by such holder in the Corporation. Any or all such signatures may be facsimiles or otherwise electronic signatures. In case any officer, transfer agent or registrar who has signed or whose facsimile or otherwise electronic signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.
Section 7.2 Statement re Uncertificated Shares. Within a reasonable time after the issuance or transfer of uncertificated shares, the stockholder of record shall be given a notice, in a writing (which may include one sent by electronic transmission), containing the information required to be set forth or stated on certificates pursuant to Section 7.1 or NRS 78.235. Except as otherwise expressly provided by law, the rights and obligations of the holders of uncertificated shares and the rights and obligations of the holders of certificates representing shares of the same class and series shall be identical.
Section 7.3 Transfers of Stock. Transfers of shares of stock of the Corporation shall be made only on the books of the Corporation upon authorization by the registered holder thereof or by such holder’s attorney thereunto authorized by a power of attorney duly executed and filed with the Secretary or a transfer agent for such stock, and if such shares are represented by a certificate, upon surrender of the certificate or certificates for such shares properly endorsed or accompanied by a duly executed stock transfer power and the payment of any taxes thereon; provided, however, that the Corporation shall be entitled to recognize and enforce any lawful restriction on transfer. Transfers may also be made in any manner authorized by the Corporation (or its authorized transfer agent) and permitted by the NRS.
Section 7.4 Lost Certificates. The Corporation may issue a new certificate or uncertificated shares in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate or the owner’s legal representative to give the Corporation a bond (or other adequate security) sufficient to indemnify it against any claim that may be made against it (including any expense or liability) on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares. The Board of Directors may adopt such other provisions and restrictions with reference to lost certificates, not inconsistent with applicable law, as it shall in its discretion deem appropriate.
Section 7.5 Stockholders of Record. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by law.
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Section 7.6 Record Date for Determining Stockholders.
(a) In order that the Corporation may determine the stockholders entitled to notice of any meeting of stockholders or any adjourned meeting, 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 by the Board of Directors, and which record date shall, unless otherwise required by law, not be more than sixty (60) nor less than ten (10) 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 (as defined in Section 2.9(c)(iii)) 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 adjourned or postponed meeting; provided, however, that the Board of Directors may fix a new record date for the determination of stockholders entitled to notice of, and to vote, at the adjourned or postponed meeting.
(b) 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 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 by the Board of Directors, and which record date shall not be more than sixty (60) days prior to such action. If no such 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.
Section 7.7 Regulations. To the extent permitted by applicable law, the Board of Directors may make such additional rules and regulations as it may deem expedient concerning the issue, transfer and registration of shares of stock of the Corporation.
Section 7.8 Waiver of Notice. Whenever notice is required to be given under any provision of the NRS or the Articles of Incorporation or these Bylaws, a written waiver, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. 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. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, the Board of Directors or a committee of the Board of Directors need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Articles of Incorporation or these Bylaws.
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ARTICLE VIII
GENERAL MATTERS
Section 8.1 Fiscal Year. The fiscal year of the Corporation shall begin on the first day of January of each year and end on the last day of December of the same year, or shall extend for such other 12 consecutive months as the Board of Directors may designate.
Section 8.2 Corporate Seal. 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 8.3 Reliance upon Books, Reports and Records. Each director and each member of any committee designated by the Board of Directors 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 that 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 8.4 Subject to Law and Articles of Incorporation. All powers, duties and responsibilities provided for in these Bylaws, whether or not explicitly so qualified, are qualified by the Articles of Incorporation and applicable law.
Section 8.5 Electronic Signatures, etc. Except as otherwise required by the Articles of Incorporation or these Bylaws (including, without limitation, as otherwise required by Section 2.13), any document, including, without limitation, any consent, agreement, certificate or instrument, required by the NRS, the Articles of Incorporation or these Bylaws to be executed by any officer, director, stockholder, employee or agent of the Corporation may be executed using a facsimile or other form of electronic signature to the fullest extent permitted by applicable law. All other contracts, agreements, certificates or instruments to be executed on behalf of the Corporation may be executed using a facsimile or other form of electronic signature to the fullest extent permitted by applicable law. The terms “electronic,” “signature” and “electronic transmission” as used herein shall have the meanings ascribed thereto in the NRS.
ARTICLE IX
EXCLUSIVE FORUM FOR ADJUDICATION OF DISPUTES
Unless the Corporation, in writing, selects or consents to the selection of an alternative forum: (a) the sole and exclusive forum for any complaint asserting any internal corporate claims (as defined below), to the fullest extent permitted by law, and subject to applicable jurisdictional requirements, shall be the Eighth Judicial District Court of Clark County, Nevada (or, if such state court lacks jurisdiction, then any other state or federal district court located in the State of Nevada); and (b) the sole and exclusive forum for any complaint asserting a cause of action arising under the Securities Act of 1933, to the fullest extent permitted by law, shall be the federal district courts of the United States of America located in the State of Nevada.
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Notwithstanding anything herein to the contrary, and for the avoidance of doubt, this Article IX shall not apply to suits brought to enforce a duty or liability created by the Exchange Act. For purposes of this Article IX, “internal corporate claims” means any action, suit, proceeding or claim (i) brought in the name or right or on behalf of the Corporation, (ii) for or based upon a breach of any fiduciary duty owed by any director, officer, or controlling stockholder of the Corporation in such capacity, (iii) arising pursuant to, or to interpret, apply, enforce or determine the validity of, any provision of NRS Title 7 (including without limitation NRS Chapters 78 and 92A), the Articles of Incorporation or these Bylaws, or any agreement entered into pursuant to NRS 78.365 to which the corporation is a party or a stated beneficiary thereof, or as to which the NRS confers jurisdiction on the courts of the State of Nevada, or (iv) asserting a claim governed by the internal affairs doctrine.
ARTICLE X
CHANGES IN NEVADA LAW
References in these Bylaws to the laws of the State of Nevada or the NRS or to any provision thereof shall be to such law as it existed on the date these Bylaws were adopted or as such law thereafter may be changed; provided that (i) in the case of any change which expands the liability of directors or officers or limits the indemnification rights or the rights to advancement of expenses which the Corporation may provide in Article VI, the rights to limited liability, to indemnification and to the advancement of expenses provided in the Articles of Incorporation and/or these Bylaws shall continue as theretofore in effect to the extent permitted by law; and (ii) if such change permits the Corporation, without the requirement of any further action by stockholders or directors, to limit further the liability of directors or limit the liability of officers or to provide broader indemnification rights or rights to the advancement of expenses than the Corporation was permitted to provide prior to such change, then liability thereupon shall be so limited and the rights to indemnification and the advancement of expenses shall be so broadened to the extent permitted by law.
ARTICLE XI
DEEMED NOTICE AND CONSENT; SEVERABILITY
Section 11.1 Deemed Notice and Consent. To the fullest extent permitted by law, each and every natural person, corporation, general or limited partnership, limited liability company, joint venture, trust, association or any other entity purchasing or otherwise acquiring any interest (of any nature whatsoever) in any shares of the capital stock of the Corporation shall be deemed, by reason of and from and after the time of such purchase or other acquisition, to have notice of and to have consented to all of the provisions of (a) these Bylaws, (b) the Articles of Incorporation and (c) any amendment to these Bylaws or the Articles of Incorporation enacted or adopted in accordance with these Bylaws, the Articles of Incorporation and applicable law.
Section 11.2 Severability. If any provision or provisions of these Bylaws shall be held to be invalid, illegal or unenforceable as applied to any circumstance for any reason whatsoever: (i) the validity, legality and enforceability of such provision(s) in any other circumstance and of the remaining provisions of these Bylaws (including, without limitation, each portion of any paragraph of the Bylaws containing any such provision held to be invalid, illegal or
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unenforceable that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (ii) to the fullest extent possible, the provisions of the Bylaws (including, without limitation, each such portion of any paragraph of the Bylaws containing any such provision held to be invalid, illegal or unenforceable) shall be construed (a) so as to permit the Corporation to protect its directors, officers, employees and agents from personal liability in respect of their good faith service or (b) for the benefit of the Corporation to the fullest extent permitted by law.
ARTICLE XII
AMENDMENTS
In furtherance and not in limitation of the powers conferred by the laws of the State of Nevada, the Board of Directors is expressly authorized to adopt, amend or repeal these Bylaws. Except as otherwise provided in the Articles of Incorporation (including the terms of any Preferred Stock Designation that provides for a greater or lesser vote) or these Bylaws, and in addition to any other vote required by law, the affirmative vote of the holders of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the stock outstanding and entitled to vote thereon, voting together as a single class, shall be required for the stockholders to adopt, amend or repeal, or adopt any provision inconsistent with, any provision of these Bylaws.
ARTICLE XIII
INAPPLICABILITY OF CONTROLLING INTEREST STATUTES
Notwithstanding any other provision in these Bylaws to the contrary, and in accordance with the provisions of NRS 78.378, the provisions of NRS 78.378 to 78.3793, inclusive, or any successor statutes, relating to acquisitions of controlling interests in the Corporation shall not apply to the Corporation or to any acquisition of any shares of the Corporation’s capital stock.
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Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of [•], 2026, is entered into by and among Mentari Therapeutics, Inc., a Delaware corporation (the “Company”) and the several investors signatory hereto (individually as an “Investor” and collectively together with their respective permitted assigns, the “Investors”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement by and among the Company and the Investors party thereto, dated as of May 19, 2026 (as amended, restated, supplemented or otherwise modified from time to time, the “Purchase Agreement”).
WHEREAS:
A. The Company is party to that certain Agreement and Plan of Merger and Reorganization by and among the Company, InMed Pharmaceuticals Inc., a company incorporated under the laws of the Province of British Columbia (“Parent”), Indigo Merger Sub Corp., a Delaware corporation and wholly-owned subsidiary of Parent (“First Merger Sub”), and Indigo Merger Sub II, LLC, a Delaware limited liability company and wholly owned subsidiary of Parent (“Second Merger Sub”), dated May 19, 2026 (as amended from time to time, the “Merger Agreement”), pursuant to which (i) First Merger Sub will merge with and into the Company, with the Company surviving and becoming a wholly-owned subsidiary of Parent (the “First Merger”), (ii) immediately following the First Merger and as part of the same overall transaction as the First Merger, the Company will merge with and into Second Merger Sub (the “Second Merger” and, together with the First Merger, the “Merger”), with Second Merger Sub being the surviving entity of the Second Merger, and (iii) Parent will change its name to Mentari Therapeutics, Inc. (“TopCo”).
B. Upon the terms and subject to the conditions of the Purchase Agreement, the Company has agreed to issue to certain Investors, and such Investors have agreed to purchase, severally and not jointly, an aggregate of up to $290,000,000 of (x) shares (the “Initial Shares”) of the Company’s common stock, par value $0.0001 per share (the “Common Stock”) and/or (y) pre-funded warrants (the “Pre-Funded Warrants”) to purchase shares of Common Stock, in each case, pursuant to the Purchase Agreement. The Initial Shares and the shares of Common Stock issuable upon exercise of the Pre-Funded Warrants are collectively referred to herein as the “Shares.”
C. To induce the Investors to enter into the Purchase Agreement, the Company has agreed to provide certain registration rights under the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the “Securities Act”), and applicable state securities laws.
NOW, THEREFORE, in consideration of the promises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Investors hereby agree as follows:
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DEFINITIONS. |
For purposes of this Agreement, the following terms shall have the following meanings:
(a) “Company” means Mentari Therapeutics, Inc. for all periods prior to the First Effective Time (as defined in the Merger Agreement) and TopCo for all periods following the First Effective Time.
(b) “Filing Deadline” means, with respect to the Initial Registration Statement required hereunder, the 30th calendar day following the Closing Date and, with respect to any New Registration Statements or other Registration Statement filed hereunder, the 30th calendar day following the later of (i) date on which the Company is permitted by SEC Guidance to file such New Registration Statement related to the Registrable Securities and (ii) the date on which the Company becomes aware of the necessity of filing such New Registration Statement related to the Registrable Securities.
(c) “Person” means any individual or entity including but not limited to any corporation, limited liability company, association, partnership, organization, business, individual, governmental or political subdivision thereof or a governmental agency.
(d) “Register,” “Registered,” and “Registration” refer to a registration effected by preparing and filing one or more registration statements of the Company in compliance with the Securities Act and providing for offering securities on a continuous basis, and the declaration or ordering of effectiveness of such registration statement(s) by the U.S. Securities and Exchange Commission (the “SEC”).
(e) “Registrable Securities” means (i) the Shares, (ii) any Shares of Common Stock of TopCo issued to an Investor on or around the date hereof pursuant to the Merger Agreement, and (iii) any Common Stock issued or issuable with respect to the foregoing as a result of any stock split or subdivision, stock dividend, recapitalization, exchange or similar event. Registrable Securities shall cease to be Registrable Securities (and the Company shall not be required to maintain the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) upon the earliest to occur of (A) the date on which such Investor shall have resold such Registrable Securities covered by the Registration Statement pursuant to the Registration Statement, (B) such Registrable Securities have been previously sold by such Investor in accordance with Rule 144, (C) such securities become eligible for resale by such Investor without volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement for the Company to be in compliance with the current public information requirement under Rule 144, (D) with respect to Registrable Securities held by an Investor that is not an affiliate of the Company, upon exchange of such Registrable Securities for unrestricted shares under an effective registration statement on Form S-4, if available, or if unavailable, another appropriate form filed with the SEC, and (E) five (5) years after the date of this Agreement.
(f) “Registration Expenses” means all registration and filing fee expenses incurred by the Company in effecting any registration pursuant to this Agreement, including (i) all registration, qualification, and filing fees, printing expenses, and any other fees and expenses associated with filings required to be made with the SEC, FINRA or any other regulatory authority, (ii) all fees and expenses in connection with compliance with or clearing the Registrable Securities for sale under any securities or “Blue Sky” laws, (iii) all printing, duplicating, word processing, messenger, telephone, facsimile and delivery expenses, and (iv) all fees and disbursements of counsel for the Company and of all independent certified public accountants of the Company (including the expenses of any special audit and cold comfort letters required by or incident to such performance); provided that in no event shall the Company be responsible for any Selling Expenses of any Investor or, except to the extent provided for in the Purchase Agreement, any legal fees or other costs of the Investors.
(g) “Registration Statement” means any registration statement of the Company filed with, or to be filed with, the SEC under the Securities Act, that Registers Registrable Securities, including the related preliminary or final prospectus, amendments and supplements to such registration statement, including pre- and post-effective amendments, and all exhibits and all material incorporated by reference in such registration statement as may be necessary to comply with applicable securities laws. “Registration Statement” shall also include a New Registration Statement, as amended when each became effective, including all documents filed as part thereof or incorporated by reference therein, and including any information contained in a prospectus subsequently filed with the SEC.
(h) “SEC Guidance” means (i) any publicly-available written or oral guidance of the SEC staff, or any comments, requirements or requests of the SEC staff (whether or not publicly-available); provided, that any such oral guidance, comments, requirements or requests are reduced to writing by the SEC (and shared with the Investors upon request if not publicly-available) and (ii) the Securities Act.
(i) “Selling Expenses” means all underwriting discounts and selling commissions applicable to the sale of Registrable Securities and all similar fees and commissions relating to an Investor’s disposition of its Registrable Securities.
| 2. |
REGISTRATION. |
(a) Mandatory Registration. The Company shall, as promptly as reasonably practicable and in any event no later than the Filing Deadline, prepare and file with the SEC an initial Registration Statement (the “Initial Registration Statement”) covering the resale of all Registrable Securities. Before filing the Registration Statement, the Company shall furnish to the Investors a copy of the Registration Statement. The Investors and their respective counsel shall have at least three (3) Business Days prior to the anticipated filing date of a Registration Statement to review and comment upon such Registration Statement and any amendment or supplement to such Registration Statement and any related prospectus (including any documents incorporated by reference therein), prior to its filing with the SEC. Subject to any SEC comments, such Registration Statement shall include the plan of distribution substantially in the form attached hereto as Exhibit B. Such Registration Statement also shall cover, to the extent allowable under the Securities Act and the rules promulgated thereunder (including Rule 416), such indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Registrable Securities. The Company shall (a) consider in good faith any comments as the Investor or its counsel reasonably proposed by the Investor to such document prior to being so filed with the SEC, and (b) not file any Registration Statement or related prospectus or any amendment or supplement thereto containing information regarding the Investor which the Investor has indicated it reasonably believes contains an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, unless such information is required (in the opinion of the Company) to comply with any applicable law or regulation or SEC Guidance. Each Investor shall furnish all information reasonably requested by the Company with respect to such Investor as shall be reasonably required in connection with any registration referred to in this Agreement.
(b) Effectiveness. The Company shall use its commercially reasonable efforts to have the Initial Registration Statement and any amendment declared effective by the SEC at the earliest possible date but no later than the earlier of the ninetieth (90th) calendar day following the initial filing date of the Initial Registration Statement if the SEC notifies the Company that it will “review” the Initial Registration Statement and (b) the fifth (5th) Business Day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that the Initial Registration Statement will not be “reviewed” or will not be subject to further review (the “Effectiveness Deadline”). The Company shall notify the Investor by e-mail as promptly as practicable, and in any event, within twenty-four (24) hours, after the Initial Registration Statement is declared effective or is supplemented and shall provide the Investor with copies of any related prospectus to be used in connection with the sale or other disposition of the securities covered thereby. The Company shall use commercially reasonable efforts to keep the Initial Registration Statement continuously effective pursuant to Rule 415 promulgated under the Securities Act and available for the resale by the Investors of all of the Registrable Securities covered thereby at all times until the earlier to occur of the following events: (i) the date on which the Investors shall have resold all the Registrable
Securities covered thereby; (ii) the date on which the Registrable Securities may be resold by the Investors without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, and without the requirement for the Company to be in compliance with the current public information requirement under Rule 144 under the Securities Act or any other rule of similar effect and (iii) five (5) years after the date of this Agreement (the “Registration Period”). The Initial Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.
(c) Sufficient Number of Shares Registered. In the event the number of shares available under the Initial Registration Statement at any time is insufficient to cover the Registrable Securities, the Company shall, to the extent necessary and permissible, amend the Initial Registration Statement or file a new registration statement (together with any prospectuses or prospectus supplements thereunder, a “New Registration Statement”), so as to cover all of such Registrable Securities as soon as reasonably practicable, but in any event not later than the Filing Deadline. The Company shall use its commercially reasonable efforts to have such amendment and/or New Registration Statement become effective as soon as reasonably practicable following the filing thereof but no later than the earlier of (a) the seventy-fifth (75th) calendar day following the initial filing date of the New Registration Statement if the SEC notifies the Company that it will “review” the New Registration Statement and (b) the fifth (5th) Business Day after the date the Company is notified (orally or in writing, whichever is earlier) by the SEC that the New Registration Statement will not be “reviewed” or will not be subject to further review. The provisions of Sections 2(a) and 2(b) shall apply to the New Registration Statement, except as modified hereby.
(d) Allowable Delays. On no more than two (2) occasions in any twelve (12)-month period and for not more than thirty (30) consecutive days or for a total of not more than sixty (60) days, the Company may delay the effectiveness of the Initial Registration Statement or any other Registration Statement, or suspend the use of any prospectus included in any Registration Statement, in the event that the Board of Directors reasonably determines, in good faith and upon advice of legal counsel, that such delay or suspension is necessary to (A) delay the disclosure of material non-public information concerning the Company, including in connection with the negotiation or consummation of a material transaction by the Company that is pending, that would require additional disclosure by the Company in the Registration Statement of material non-public information that the Company has a bona fide business purpose for preserving as confidential and the non-disclosure of which would be expected, in the reasonable determination of the Board of Directors, upon advice of legal counsel, to cause the Registration Statement to fail to comply with applicable disclosure requirements, or (B) amend or supplement the affected Registration Statement or the related prospectus so that such Registration Statement or prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the case of the prospectus in light of the circumstances under which they were made, not misleading (an “Allowed Delay”); provided, that the Company shall promptly (a) notify each Investor in writing of the commencement of an Allowed Delay, but shall not (without the prior written consent of an Investor) disclose to such Investor any material non-public information giving rise to an Allowed Delay, (b) advise the Investors in writing to cease all sales under the applicable Registration Statement until the end of the Allowed Delay and (c) use commercially reasonable efforts to terminate an Allowed Delay as promptly as practicable. Each Investor may deliver written notice (an “Opt-Out Notice”) to the Company requesting that such Investor not receive notices from the Company otherwise required by this Section 2; provided, however, that such Investor may later revoke any such Opt-Out Notice in writing, which shall be effective five (5) Business Days after the receipt thereof. Following receipt of an Opt-Out Notice from an Investor (unless subsequently revoked), the Company shall not deliver any notices pursuant to this Section 2(d) to such Investor and such Investor shall no longer be entitled to the rights associated with any such notice.
(e) Rule 415; Cutback. If at any time the SEC takes the position that the offering of some or all of the Registrable Securities in any Registration Statement is not eligible to be made on a delayed or continuous basis under the provisions of Rule 415 under the Securities Act (provided, however, the Company shall be obligated to use commercially reasonable efforts to advocate with the SEC for the registration of all of the Registrable Securities) or requires any Investor to be named as an “underwriter,” the Company shall (i) promptly notify each holder of Registrable Securities thereof and (ii) make commercially reasonable efforts to persuade the SEC that the offering contemplated by such Registration Statement is a valid secondary offering and not an offering “by or on behalf of the issuer” as defined in Rule 415 and that none of the Investors is an “underwriter.” Each Investor shall have the right to have its legal counsel, at such Investor’s expense, to review and oversee any registration or matters pursuant to this Section 2(e), including to comment on any written submission made to the SEC with respect thereto. In the event that, despite the Company’s commercially reasonable efforts and compliance with the terms of this Section 2(e), the SEC refuses to alter its position, the Company shall (i) remove from such Registration Statement such portion of the Registrable Securities and/or (ii) agree to such restrictions and limitations on the registration and resale of the Registrable Securities as the SEC may require to assure the Company’s compliance with the requirements of Rule 415 (collectively, the “SEC Restrictions”); provided, however, that the Company shall not name any Investor as an “underwriter” in such Registration Statement without the prior written consent of such Investor (provided that, in the event an Investor withholds such consent, the Company shall have no obligation hereunder to include any Registrable Securities of such Investor in any Registration Statement covering the resale thereof until such time as the SEC no longer requires such Investor to be named as an “underwriter” in such Registration Statement or such Investor otherwise consents in writing to being so named). Any cut-back imposed on the Investors pursuant to this Section 2(e) shall be allocated among the Investors on a pro rata basis and shall be applied first to any of the Registrable Securities of an Investor that the SEC has indicated cannot be included or must be limited in the number of Registrable Securities that can be included, and thereafter to all other Investors, unless the SEC Restrictions otherwise require or provides otherwise, or an Investor otherwise agrees.
(f) Each Registration Statement filed hereunder shall be on Form S-3 (except if the Company is not then eligible to register for resale the Registrable Securities on Form S-3, in which case such registration shall be on another form in accordance with the provisions of this Section 2(f)). If Form S-3 is not available for the registration of the resale of Registrable Securities hereunder, the Company shall (i) register the resale of the Registrable Securities on another appropriate form and (ii) undertake to register the Registrable Securities on Form S-3 as soon as such form is available, provided that the Company shall maintain the effectiveness of the Registration Statement then in effect until such time as a Registration Statement on Form S-3 covering the Registrable Securities has been declared effective by the SEC.
| 3. |
RELATED COMPANY OBLIGATIONS. |
With respect to the Registration Statement and whenever any Registrable Securities are to be Registered pursuant to Section 2, including on the Initial Registration Statement or on any New Registration Statement, the Company shall use its commercially reasonable efforts to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:
(a) Notifications. The Company will promptly notify the Investors of the time when any subsequent amendment to the Initial Registration Statement or any New Registration Statement, other than documents incorporated by reference, has been filed with the SEC and/or has become effective or where a receipt has been issued therefor or any subsequent supplement to a prospectus has been filed and of any request by the SEC for any amendment or supplement to the Registration Statement, any New Registration Statement or any prospectus or for additional information regarding the Investor.
5
(b) Amendments. The Company will prepare and file with the SEC any amendments, post-effective amendments or supplements to the Initial Registration Statement, any New Registration Statement or any related prospectus, as applicable, that, (a) as may be necessary to keep such Registration Statement effective for the Registration Period and to comply with the provisions of the Securities Act and the Exchange Act with respect to the distribution of all of the Registrable Securities covered thereby, or (b) in the reasonable opinion of the Investors and the Company, as may be necessary or advisable in connection with any acquisition or sale of Registrable Securities by the Investors.
(c) Investor Review. The Company will not file any amendment or supplement to the Registration Statement, any New Registration Statement or any prospectus, other than documents incorporated by reference, relating to any Investor, the Registrable Securities or the transactions contemplated hereby unless (A) such Investor and its counsel shall have been advised and afforded the opportunity to review and comment thereon at least three (3) Business Days prior to filing with the SEC and (B) the Company shall have given reasonable due consideration to any comments thereon received from such Investor or its counsel.
(d) Copies Available. The Company will furnish to any Investor whose Registrable Securities are included in any Registration Statement and its counsel copies of the Initial Registration Statement, any prospectus thereunder (including all documents incorporated by reference therein), any prospectus supplement thereunder, any New Registration Statement and all amendments to the Initial Registration Statement or any New Registration Statement that are filed with the SEC during the Registration Period (including all documents filed with or furnished to the SEC during such period that are deemed to be incorporated by reference therein), each letter written by or on behalf of the Company to the SEC or the staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each case relating to such Registration Statement (other than any portion thereof which contains information for which the Company has sought confidential treatment) and such other documents as such Investor may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Investor that are covered by such Registration Statement, in each case as soon as reasonably practicable upon such Investor’s request and in such quantities as such Investor may from time to time reasonably request; provided, however, that the Company shall not be required to furnish any document to such Investor to the extent such document is available on EDGAR.
(e) Notification of Stop Orders; Material Changes. The Company shall use commercially reasonable efforts to (i) prevent the issuance of any stop order or other suspension of effectiveness and, (ii) if such order is issued, obtain the withdrawal of any such order as soon as practicable. The Company shall advise the Investors promptly (but in no event later than 24 hours) and shall confirm such advice in writing, in each case: (i) of the Company’s receipt of notice of any request by the SEC or any other federal or state governmental authority for amendment of or a supplement to the Registration Statement or any prospectus or for any additional information; (ii) of the Company’s receipt of notice of the issuance by the SEC or any other federal or state governmental authority of any stop order suspending the effectiveness of the Initial Registration Statement or prohibiting or suspending the use of any prospectus or prospectus supplement, or any New Registration Statement, or of the Company’s receipt of any notification of the suspension of qualification of the Registrable Securities for offering or sale in any jurisdiction or the initiation or contemplated initiation of any proceeding for such purpose; and (iii) of the Company becoming aware of the happening of any event, which makes any statement of a material fact made in any Registration Statement or any prospectus untrue or which requires the making of any additions to or changes to the statements then made in any Registration Statement or any prospectus in order to state a material fact required by the Securities Act to be stated therein or necessary in order to make the statements then made therein (in the case of any prospectus, in light of the circumstances under which they were made)
6
not misleading, or of the necessity to amend any Registration Statement or any prospectus to comply with the Securities Act or any other law. The Company shall not be required to disclose to the Investors (and shall not so disclose to any Investor without such Investor’s prior written consent) the substance of specific reasons of any of the events set forth in clauses (i) through (iii) of the immediately preceding sentence (each, a “Suspension Event”), but rather, shall only be required to disclose that the event has occurred; provided that the Company shall not provide any material non-public information to the Investors in such notice. If at any time the SEC, or any other federal or state governmental authority shall issue any stop order suspending the effectiveness of any Registration Statement or prohibiting or suspending the use of any prospectus or prospectus supplement, the Company shall use its commercially reasonable efforts to obtain the withdrawal of such order at the earliest practicable time. The Company shall furnish to any Investor upon request, without charge, a copy of any correspondence from the SEC or the staff of the SEC, or any other federal or state governmental authority to the Company or its representatives relating to the Initial Registration Statement, any New Registration Statement or any prospectus, or prospectus supplement as the case may be. In the event of a Suspension Event set forth in clause (iii) of the second sentence of this Section 3(e), the Company will use its commercially reasonable efforts to publicly disclose such event as soon as reasonably practicable, or otherwise resolve the matter such that sales under Registration Statements may resume.
(f) Confirmation of Effectiveness. If requested by an Investor at any time in respect of any Registration Statement, the Company shall deliver to such Investor a written confirmation (email being sufficient) from Company’s counsel of whether or not the effectiveness of such Registration Statement has lapsed at any time for any reason (including, without limitation, the issuance of a stop order) and whether or not such Registration Statement is currently effective and available to the Company for sale of Registrable Securities.
(g) Listing. The Company shall use commercially reasonable efforts to cause all Registrable Securities covered by a Registration Statement to be listed on the Nasdaq Capital Market and/or any other National Exchange upon which the Common Stock is listed.
(h) Compliance. The Company shall otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC under the Securities Act and the Exchange Act, including, without limitation, Rule 172 under the Securities Act, file any final prospectus, including any supplement or amendment thereof, with the SEC pursuant to Rule 424 under the Securities Act by 9:30 a.m. New York time on the Business Day following the date of the event requiring disclosure, promptly inform the Investor in writing if, at any time during the Registration Period, the Company does not satisfy the conditions specified in Rule 172 and, as a result thereof, the Investor is required to deliver a prospectus in connection with any disposition of Registrable Securities and take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder, and make available to its security holders, as soon as reasonably practicable, but not later than the Availability Date (as defined below), an earnings statement covering a period of at least twelve (12) months, beginning after the effective date of each Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act, including Rule 158 promulgated thereunder (for the purpose of this Section 3(h), “Availability Date” means the forty-fifth (45th) day following the end of the fourth (4th) fiscal quarter that includes the effective date of such Registration Statement, except that, if such fourth (4th) fiscal quarter is the last quarter of the Company’s fiscal year, “Availability Date” means the ninetieth (90th) day after the end of such fourth (4th) fiscal quarter).
(i) Blue-Sky. The Company shall use commercially reasonable efforts to register or qualify or cooperate with any Investor and its counsel in connection with the registration or qualification of such Registrable Securities for the offer and sale under the securities or blue sky laws of such jurisdictions reasonably requested by such Investor; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (i) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(i), (ii) subject itself to general taxation in any jurisdiction where it would not otherwise be so subject but for this Section 3(i), or (iii) file a general consent to service of process in any such jurisdiction.
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(j) Rule 144. With a view to making available to the Investors the benefits of Rule 144 (or its successor rule) and any other rule or regulation of the SEC that may at any time permit the Investors to sell shares of Registrable Securities to the public without registration, the Company covenants and agrees to use commercially reasonable efforts to make and keep adequate current public information available, as those terms are understood and defined in Rule 144, until the date as all of the Initial Shares may be sold without restriction by the holders thereof pursuant to Rule 144 or any other rule of similar effect (without the requirement for the Company to be in compliance with any current public information requirements). In addition for so long as any Registrable Securities are outstanding, the Company covenants and agrees to use commercially reasonable efforts to (i) file with the SEC in a timely manner all reports and other documents required of the Company under the Exchange Act; and (ii) furnish electronically to each Investor upon request, as long as such Investor owns any Registrable Securities, (A) a written statement by the Company that it has complied with the reporting requirements of the Exchange Act, (B) a copy of or electronic access to the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, and (C) such other information as may be reasonably requested in order to avail such Investor of any rule or regulation of the SEC that permits the selling of any such Registrable Securities without registration.
(k) Cooperation. The Company shall cooperate with the holders of the Registrable Securities to facilitate the timely preparation and delivery of certificates or uncertificated shares representing the Registrable Securities to be sold pursuant to such Registration Statement or Rule 144 free of any restrictive legends and representing such number of shares of Common Stock and registered in such names as the holders of the Registrable Securities may reasonably request in accordance with the provisions of the Purchase Agreement, and the Company may satisfy its obligations hereunder without issuing physical stock certificates through the use of The Depository Trust Company’s Direct Registration System.
(l) Removal of Restrictive Legends. Without limiting Section 5.5 of the Purchase Agreement, the Company shall use commercially reasonable efforts to cause the Company’s transfer agent to remove any restrictive legend from any Registrable Securities, as promptly as practicable following effectiveness of the applicable Registration Statement, without any request for removal being required from any holder of Registrable Securities.
| 4. |
OBLIGATIONS OF THE INVESTORS. |
(a) Investor Information. Each Investor shall provide a completed Investor Questionnaire in the form attached hereto as Exhibit A or such other form of questionnaire or information reasonably required by the Company in connection with the registration of the Registrable Securities within three (3) Business Days of request by the Company and no later than the end of the third (3rd) Business Day following the date on which such Investor receives draft materials in accordance with Section 2(a).
(b) Suspension of Sales. Each Investor, severally and not jointly with any other Investor, agrees that, upon receipt of any notice from the Company of the existence of an Allowed Delay or Suspension Event, the Investor will promptly discontinue disposition of Registrable Securities pursuant to any Registration Statement covering such Registrable Securities until the Investor’s receipt of a notice from the Company confirming the resolution of such Allowed Delay or Suspension Event and that such dispositions may again be made; provided, for the avoidance of doubt, that the foregoing shall not limit the right of the Investor to sell or otherwise dispose of the Registrable Securities pursuant to Rule 144 or any other exemption from the registration requirements of the Securities Act or to settle a transaction pursuant to a Registration Statement as to which a contract for such sale was entered into prior to such Investor’s
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receipt of the notice from the Company of the existence of the Allowed Delay or Suspension Event. The Company shall cause its transfer agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with any sale of Registrable Securities pursuant to a Registration Statement with respect to which such Investor has entered into a contract for sale prior to such Investor’s receipt of the notice from the Company of the existence of the Allowed Delay or Suspension Event.
(c) Investor Cooperation. Each Investor, severally and not jointly with any other Investor, agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of any amendments and supplements to any Registration Statement or New Registration Statement hereunder, unless such Investor has notified the Company in writing of its election to exclude all of its Registrable Securities from such Registration Statement.
| 5. |
EXPENSES OF REGISTRATION. |
All Registration Expenses incurred in connection with registrations pursuant to this Agreement shall be borne by the Company. All Selling Expenses relating to securities registered on behalf of an Investor shall be borne by such Investor.
| 6. |
INDEMNIFICATION. |
(a) To the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend each Investor, each Person, if any, who controls each Investor, the shareholders, directors, officers, partners, employees, members, managers, agents, representatives and advisors of each Investor and each Person, if any, who controls any of the foregoing within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Person”), against any losses, obligation, claims, damages, liabilities, contingencies, judgments, fines, penalties, charges and costs (including, without limitation, court costs and costs of preparation), reasonable and documented attorneys’ fees, amounts paid in settlement or reasonable and documented expenses (collectively, “Indemnified Damages”) reasonably incurred in investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or other regulatory agency or body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party thereto (“Claims”), to which any of them may become subject insofar as such Claims (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement or omission or alleged omission of any material fact contained in any Registration Statement, or (ii) any violation or alleged violation by the Company or any of its Subsidiaries of the Securities Act, Exchange Act or any other state securities or other “blue sky” laws of any jurisdiction in which Registrable Securities are offered or any rule or regulation promulgated thereunder applicable to the Company or its agents and relating to action or inaction required of the Company in connection with such registration of the Registrable Securities (the matters in the foregoing clauses (i) and (ii) being, collectively, “Violations”). The Company shall reimburse each Indemnified Person promptly as such Indemnified Damages are incurred and are due and payable, for any reasonable out-of-pocket legal fees or other reasonable and documented expenses incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(a): (A) shall not apply to a Claim by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information furnished in writing to the Company by the Investors or such Indemnified Person specifically for use in such Registration Statement and was reviewed and approved in writing by such Investor or such Indemnified Person expressly for use in connection with the preparation of any Registration Statement; (B) with respect to any superseded prospectus, shall not inure to the benefit of any such Person from whom the Person asserting any such Claim purchased the Registrable Securities that are the subject thereof (or to the benefit of any other Indemnified Person) if the untrue statement or omission
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of material fact contained in the superseded prospectus was corrected in the revised prospectus, as then amended or supplemented, and the Indemnified Person was promptly advised in writing not to use the outdated, defective or incorrect prospectus prior to the use giving rise to a Violation; (C) shall not be available to the extent such Claim is based on a failure of the Indemnified Person to deliver, or cause to be delivered, if required the prospectus to the Persons asserting an untrue statement or omission or alleged untrue statement or omission at or prior to the written confirmation of the sale of Registrable Securities; and (D) shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld, conditioned or delayed. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer of the Registrable Securities by the Investor pursuant to Section 8.
(b) In connection with the Initial Registration Statement, any New Registration Statement or any prospectus, each Investor, severally and not jointly, agrees to indemnify, hold harmless and defend, the Company, each of its directors, and officers who signed the Initial Registration Statement or signs any New Registration Statement, and each Person, if any, who controls the Company within the meaning of the Securities Act or the Exchange Act (each, an “Indemnified Party”), against any losses, claims, damages, liabilities and expense (including reasonable attorney fees) resulting from (i) any untrue statement or alleged untrue statement or omission or alleged omission of any material fact contained in any Registration Statement or (ii) any violation or alleged violation by such Investor of its obligations under this Agreement, in each case to the extent, and only to the extent, that such violation occurs in reliance upon and in conformity with information about such Investor furnished in writing by such Investor to the Company expressly for use in connection with the preparation of the Registration Statement. In no event shall the liability of an Investor be greater in amount than the dollar amount of the proceeds (net of all expense paid by such Investor in connection with any claim relating to this Section 6 and the amount of any damages such Investor has otherwise been required to pay by reason of such untrue statement or omission) received by such Investor upon the sale of the Registrable Securities included in such Registration Statement giving rise to such indemnification obligation. Notwithstanding anything to the contrary contained herein, the indemnification agreement contained in this Section 6(b), shall not apply to amounts paid in settlement of any Claim if such settlement is effected without the prior written consent of the Investor, which consent shall not be unreasonably withheld, conditioned or delayed. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall survive the transfer of the Registrable Securities by an Investor pursuant to Section 8.
(c) Promptly after receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding (including any governmental action or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified Party, as the case may be, and upon such notice, the indemnifying party shall not be liable to the Indemnified Person or the Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Person or the Indemnified Party in connection with the defense thereof; provided, however, that an Indemnified Person or Indemnified Party (together with all other Indemnified Persons and Indemnified Parties that may be represented without conflict by one counsel) shall have the right to retain its own counsel with the reasonable fees and expenses to be paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the indemnifying party, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding. The Indemnified
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Party or Indemnified Person shall cooperate with the indemnifying party in connection with any negotiation or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably available to the Indemnified Party or Indemnified Person which relates to such action or claim. The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised as to the status of the defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without its written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent. No indemnifying party shall, without the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise unless such judgment or settlement (i) imposes no liability or obligation on, (ii) includes as an unconditional term thereof the giving of a complete, explicit and unconditional release from the party bringing such indemnified claims of all liability of the Indemnified Party or Indemnified Person in respect to or arising out of such claim or litigation in favor of, and (iii) does not include any admission of fault, culpability, wrongdoing, or wrongdoing or malfeasance by or on behalf of, the Indemnified Party or Indemnified Person. Following indemnification as provided for hereunder, the indemnifying party shall be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is prejudiced in its ability to defend such action.
(d) The indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or Indemnified Damages are incurred. Any Person receiving a payment pursuant to this Section 6 which person is later determined to not be entitled to such payment shall return such payment (including reimbursement of expenses) to the person making it.
(e) The indemnity agreements contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.
| 7. |
CONTRIBUTION. |
To the extent any indemnification by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided, however, that: (i) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any seller of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of proceeds (net of all expenses paid by such holder in connection with any claim relating to this Section 7 and the amount of any damages such holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission) received by such seller from the sale of such Registrable Securities giving rise to such contribution obligation.
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| 8. |
ASSIGNMENT OF REGISTRATION RIGHTS. |
The Company shall not assign this Agreement or any rights or obligations hereunder (whether by operation of law or otherwise) without the prior written consent of the Investors holding a majority of the Registrable Securities then outstanding (determined as if all of the Pre-Funded Warrants then outstanding have been exercised in full without regard to any limitations on the exercise of such Pre-Funded Warrants) (voting together as a single class); provided, however, that in any transaction, whether by merger, reorganization, restructuring, consolidation, financing or otherwise, whereby the Company is a party and in which the Registrable Securities are converted into the equity securities of another Person, from and after the effective time of such transaction, such Person shall, by virtue of such transaction, be deemed to have assumed the obligations of the Company hereunder, the term “Company” shall be deemed to refer to such Person and the term “Registrable Securities” shall be deemed to include the securities received by the Investor in connection with such transaction unless such securities are otherwise freely tradable by the Investor after giving effect to such transaction, and the prior written consent of the Investors holding a majority of the Registrable Securities then outstanding (determined as if all of the Pre-Funded Warrants then outstanding have been exercised in full without regard to any limitations on the exercise of such Pre-Funded Warrants) shall not be required for such transaction. No Investor may assign its rights under this Agreement, other than to an affiliate of such Investor or to any other investment funds or accounts managed or advised by the investment manager who acts on behalf of the Investor, without the prior written consent of the Company. The provisions of this Agreement shall be binding upon and inure to the benefit of the Investor and its successors and permitted assigns.
| 9. |
AMENDMENTS AND WAIVERS. |
The provisions of this Agreement, including the provisions of this sentence, may be amended, modified or supplemented, or waived only by a written instrument executed by (a) the Company and (b) the holders of a majority of the then outstanding Registrable Securities (determined as if all of the Pre-Funded Warrants then outstanding have been exercised in full without regard to any limitations on the exercise of such Pre-Funded Warrants) (voting together as a single class), provided that (i) any party may give a waiver as to itself, (ii) any amendment, modification, supplement or waiver that disproportionately and adversely affects the rights and obligations of any Investor relative to the comparable rights and obligations of the other Investors shall require the prior written consent of such adversely affected Investor or each Investor, as applicable, and (iii) any amendments to Section 6 or to the definitions of “Filing Deadline,” “Effectiveness Deadline,” or “Registration Period” shall require the written consent of each Investor. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of one or more Investors and that does not adversely directly or indirectly affect the rights of other Investors may be given by Investors holding a majority of the Registrable Securities (determined as if all of the Pre-Funded Warrants then outstanding have been exercised in full without regard to any limitations on the exercise of such Pre-Funded Warrants) to which such waiver or consent relates.
| 10. |
MISCELLANEOUS. |
(a) Notices. Any notices or other communications required or permitted to be given hereunder shall be in writing and shall be deemed to be given (a) when delivered if personally delivered to the party for whom it is intended, (b) when delivered, if sent by electronic mail during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, provided no rejection or undeliverable notice is received, (c) three (3) days after having been sent by certified or registered mail, return-receipt requested and postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt:
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i. If to the Company, addressed as follows:
Mentari Therapeutics, Inc.
221 Crescent Street
Building 23, Suite 105
Waltham, MA 02453 Attention: [***]
Email: [***]
with a copy (which shall not constitute notice):
Gibson, Dunn & Crutcher LLP
One Embarcadero Center, Suite 2600
San Francisco, CA 94111
Attention: Ryan Murr, Branden Berns, Evan Shepherd
Email: rmurr@gibsondunn.com; bberns@gibsondunn.com;
eshepherd@gibsondunn.com
ii. If to any Investor, at its e-mail address or address set forth on Exhibit A to the Purchase Agreement or to such e-mail address, or address as subsequently modified by written notice given in accordance with this Section 10(a).
Any Person may change the address to which notices and communications to it are to be addressed by notification as provided for herein.
(b) No Waiver. No failure or delay on the part of either party hereto in the exercise of any power, right or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude any other or further exercise thereof or of any other right, power or privilege.
(c) Governing Law; Submission to Jurisdiction; Venue; Waiver of Trial by Jury. The provisions of Section 8.5 of the Purchase Agreement are incorporated by reference herein mutatis mutandis.
(d) Integration. This Agreement and the other Transaction Agreements (including all schedules and exhibits hereto and thereto) constitute the entire agreement between the parties hereto respecting the subject matter hereof and thereof and supersedes all prior agreements, negotiations, understandings, representations and statements respecting the subject matter hereof and thereof, whether written or oral.
(e) Headings. The titles, subtitles and headings in this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.
(f) Counterparts. This Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that a facsimile or pdf signature including any electronic signatures complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile or pdf (or other electronic reproduction of a) signature.
(g) Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.
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(h) Contract Interpretation. This Agreement is the joint product of each Investor and the Company and each provision hereof has been subject to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.
(i) No Third-Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as expressly provided in this Agreement. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
(j) Severability. If any part or provision of this Agreement is held unenforceable or in conflict with the applicable laws or regulations of any jurisdiction, the invalid or unenforceable part or provisions shall be replaced with a provision which accomplishes, to the extent possible, the original business purpose of such part or provision in a valid and enforceable manner, and the remainder of this Agreement shall remain binding upon the parties hereto.
(k) Non-Recourse. Notwithstanding anything that may be expressed or implied in this Agreement, the Company covenants, agrees and acknowledges that no recourse under this Agreement or any documents or instruments delivered in connection with this Agreement shall be had against any current or future director, officer, employee, stockholder, general or limited partner or member of the Investors or of any affiliates or assignees thereof, whether by the enforcement of any assessment or by any legal or equitable proceeding, or by virtue of any statute, regulation or other applicable law, it being expressly agreed and acknowledged that no personal liability whatsoever shall attach to, be imposed on or otherwise be incurred by any current or future director, officer, employee, stockholder, general or limited partner or member of the Investors or of any affiliates or assignees thereof, as such for any obligation of the Investors under this Agreement or any documents or instruments delivered in connection with this Agreement for any claim based on, in respect of or by reason of such obligations or their creation.
(l) Specific Performance. In addition to any and all other remedies that may be available at law in the event of any breach of this Agreement, each Investor shall be entitled to specific performance of the agreements and obligations of the Company hereunder and to such other injunction or equitable relief as may be granted by a court of competent jurisdiction.
(m) Cumulative Remedies. The remedies provided herein are cumulative and not exclusive of any remedies provided by law.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be duly executed as of date first written above.
| COMPANY: | ||
| MENTARI THERAPEUTICS, INC. | ||
| By: |
| |
| Name: |
||
| Title: |
||
[Signature Page to Registration Rights Agreement]
IN WITNESS WHEREOF, the parties have caused this Registration Rights Agreement to be duly executed as of date first written above.
| INVESTOR: | ||
| [NAME] | ||
| By: |
| |
| Name: |
||
| Title: |
||
[Signature Page to Registration Rights Agreement]
Exhibit A
Investor Questionnaire
The undersigned hereby provides the following information to the Company and represents and warrants that such information is accurate:
QUESTIONNAIRE
| 1. |
Name. |
| (a) |
Full Legal Name of Investor |
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| |
| (b) |
Full Legal Name of Registered Holder (if not the same as (a) above) through which Registrable Securities are held: |
|
|
| |
| (c) |
Full Legal Name of Natural Control Person (which means a natural person who directly or indirectly alone or with others has power to vote or dispose of the securities covered by this Questionnaire): |
|
|
| |
| 2. |
Address for Notices to Investor: |
|
|
|
|
|
|
| Telephone: |
|
|
| E-Mail: ___________________________________________________________________________________________________ |
| Contact Person: |
1
| 3. |
Broker-Dealer Status: |
| (a) |
Are you a broker-dealer? |
Yes ☐ No ☐
| (b) |
If “yes” to Section 3(a), did you receive your Registrable Securities as compensation for investment banking services to the Company? |
Yes ☐ No ☐
| Note: |
If “no” to Section 3(b), the SEC’s staff has indicated that you should be identified as an underwriter in the Registration Statement. |
| (c) |
Are you an affiliate of a broker-dealer? |
Yes ☐ No ☐
| (d) |
If you are an affiliate of a broker-dealer, do you certify that you purchased the Registrable Securities in the ordinary course of business, and at the time of the purchase of the Registrable Securities to be resold, you had no agreements or understandings, directly or indirectly, with any person to distribute the Registrable Securities? |
Yes ☐ No ☐
| Note: |
If “no” to Section 3(d), the SEC’s staff has indicated that you should be identified as an underwriter in the Registration Statement. |
| 4. |
Beneficial Ownership of Securities of the Company Owned by the Investor. |
Except as set forth below in this Item 4, the undersigned is not the beneficial or registered owner of any securities of the Company other than the securities issuable pursuant to the Purchase Agreement.
| (a) |
Type and Amount of other securities beneficially owned by the Investor: |
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| |
|
| ||
2
| 5. |
Relationships with the Company: |
Except as set forth below, neither the undersigned nor any of its affiliates, officers, directors or principal equity holders (owners of 5% of more of the equity securities of the undersigned) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years.
State any exceptions here:
|
|
| |
|
| ||
The undersigned agrees to promptly notify the Company of any material inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof at any time while the Registration Statement remains effective; provided, that the undersigned shall not be required to notify the Company of any changes to the number of securities held or owned by the undersigned or its affiliates.
By signing below, the undersigned consents to the disclosure of the information contained herein in its answers to Items 1 through 5 and the inclusion of such information in the Registration Statement and the related prospectus and any amendments or supplements thereto. The undersigned understands that such information will be relied upon by the Company in connection with the preparation or amendment of the Registration Statement and the related prospectus and any amendments or supplements thereto.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized agent.
| Date: _____________________________ |
Beneficial Owner: _____________________________________________ | |||||
| By: |
| |||||
| Name: | ||||||
| Title: | ||||||
PLEASE EMAIL A .PDF COPY OF THE COMPLETED AND EXECUTED QUESTIONNAIRE TO: agidwani@gibsondunn.com
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Exhibit B
Plan of Distribution
PLAN OF DISTRIBUTION
The selling stockholders, which as used herein includes donees, pledgees, transferees or other successors-in-interest selling shares of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices.
The selling stockholders may use any one or more of the following methods when disposing of shares or interests therein:
| • |
distributions to members, partners, stockholders or other equityholders of the selling stockholders; |
| • |
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
| • |
block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction; |
| • |
purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
| • |
an exchange distribution in accordance with the rules of the applicable exchange; |
| • |
privately negotiated transactions; |
| • |
short sales and settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part; |
| • |
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
| • |
broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share; |
| • |
a combination of any such methods of sale; and |
| • |
any other method permitted pursuant to applicable law. The selling stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of common stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act, amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus. The selling stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling stockholders for purposes of this prospectus. |
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In connection with the sale of our common stock or interests therein, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The aggregate proceeds to the selling stockholders from the sale of the common stock offered by them will be the purchase price of the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly or through agents. We will not receive any of the proceeds from this offering. Upon any exercise of the pre-funded warrants by payment of cash, however, we will receive the exercise price of the pre-funded warrants.
The selling stockholders also may resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under the Securities Act, provided that they meet the criteria and conform to the requirements of that rule, or another available exemption from the registration requirements under the Securities Act.
The selling stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests therein may be “underwriters” within the meaning of Section 2(a)(11) of the Securities Act (it being understood that the selling stockholders shall not be deemed to be underwriters solely as a result of their participation in this offering). Any discounts, commissions, concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities Act. Selling stockholders who are “underwriters” within the meaning of Section 2(a)(11) of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act.
To the extent required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase prices and public offering prices, the names of any agent, dealer or underwriter, and any applicable commissions or discounts with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus.
2
In order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with.
We have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, to the extent applicable, we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act.
We have agreed to indemnify the selling stockholders against liabilities, including liabilities under the Securities Act and state securities laws, relating to the registration of the shares offered by this prospectus.
We have agreed with the selling stockholders to use commercially reasonable efforts to cause the registration statement of which this prospectus constitutes a part to become effective and to remain continuously effective until the earlier of: (i) the date on which the selling stockholders shall have resold or otherwise disposed of all the shares covered by this prospectus and (ii) the date on which the shares covered by this prospectus no longer constitute “Registrable Securities” as such term is defined in the Registration Rights Agreement, such that they may be resold by the selling stockholders without registration and without regard to any volume or manner-of-sale limitations and without current public information pursuant to Rule 144 under the Securities Act or any other rule of similar effect.
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Exhibit 10.7
[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE THE INFORMATION (I) IS NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT THE REGISTRANT BOTH CUSTOMARILY AND ACTUALLY TREATS AS PRIVATE AND CONFIDENTIAL.
CONTINGENT VALUE RIGHTS AGREEMENT
This CONTINGENT VALUE RIGHTS AGREEMENT (this “Agreement”), dated as of November 6, 2026, is entered into by and between Mentari Therapeutics, Inc. (formerly known as InMed Pharmaceuticals Inc.), a corporation organized under the laws of British Columbia, Canada (the “Parent”), and Odyssey Transfer and Trust Company, a trust company incorporated in the state of Minnesota (the “Rights Agent”), and Indigo CVR Services Inc., a corporation organized under the laws of British Columbia, Canada, solely in its capacity as the initial representative, agent and attorney in fact of the Holders (the “Representative”).
RECITALS
WHEREAS, the Parent, Indigo Merger Sub Corp., a Delaware corporation and wholly-owned subsidiary of the Parent (“First Merger Sub”), Indigo Merger Sub II, LLC, a Delaware limited liability company and wholly-owned subsidiary of the Parent (“Second Merger Sub”), and Mentari Therapeutics, Inc., a Delaware corporation (“Mentari”), have entered into an Agreement and Plan of Merger and Reorganization, dated as of May 19, 2026 (as amended on July 6, 2026, the “Merger Agreement”), pursuant to which First Merger Sub will merge with and into Mentari (the “First Merger”), with Mentari surviving the First Merger as a wholly-owned Subsidiary of the Parent, and immediately following the First Merger and as part of the same overall transaction as the First Merger, Mentari will merge with and into Second Merger Sub (the “Second Merger” and, together with the First Merger, the “Merger”), with Second Merger Sub being the surviving entity of the Second Merger;
WHEREAS, pursuant to the Merger Agreement, and in accordance with the terms and conditions thereof, the Parent has agreed to issue to the Holders (as defined herein) contingent value rights as hereinafter described;
WHEREAS, the parties to this Agreement have done all things reasonably necessary to make the contingent value rights, when issued pursuant to the Merger Agreement and hereunder, the valid obligations of the Parent and to make this Agreement a valid and binding agreement of the Parent, in accordance with its terms; and
WHEREAS, the initial Holders desire that the Representative act as their agent for the purposes of accomplishing the intent and implementing the provisions of this Agreement and facilitating the consummation of the transactions contemplated hereby and performing the other services described in this Agreement.
NOW, THEREFORE, in consideration of the premises and the consummation of the transactions referred to above, it is mutually covenanted and agreed, for the proportionate benefit of all Holders, as follows:
ARTICLE 1
DEFINITIONS
Section 1.1 Definitions. Capitalized terms used but not otherwise defined herein have the meanings ascribed thereto in the Merger Agreement. The following terms have the meanings ascribed to them as follows:
“Accounting Firm” means an independent certified public accounting firm of nationally recognized standing in Canada or the United States designated on or prior to the First Effective Time either (a) jointly by the Acting Holders and the Parent, or (b) if such parties fail to make a designation, jointly by an independent public accounting firm selected by the Parent and an independent public accounting firm selected by the Acting Holders.
1
[***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED BECAUSE THE INFORMATION (I) IS NOT MATERIAL AND (II) IS THE TYPE OF INFORMATION THAT THE REGISTRANT BOTH CUSTOMARILY AND ACTUALLY TREATS AS PRIVATE AND CONFIDENTIAL.
“Acting Holders” means, at the time of determination, the Holders, alone or in the aggregate, of not less than 20% of the then outstanding CVRs, as reflected on the CVR Register.
“Advisory Group” has the meaning set forth in Section 4.5.
“Affiliate” shall have the meaning given to such term in Rule 145 under the Securities Act.
“Approved Bank” has the meaning set forth in Section 3.4.
“Audit Right End Date” has the meaning set forth in Section 4.4.
“Assignee” has the meaning set forth in Section 6.5.
“Code” means the Internal Revenue Code of 1986, as amended.
“CVR” means a contingent contractual right of Holders to receive CVR Proceeds pursuant to the Merger Agreement and this Agreement.
“CVR Expense Cap” has the meaning set forth in Section 4.2.
“CVR Payment Amount” means, for a given Holder, an amount equal to the product of (a) the CVR Proceeds and (b) (i) the total number of CVRs entitled to receive such CVR Proceeds held by such Holder divided by (ii) the total number of CVRs entitled to receive such CVR Proceeds held by all Holders, in each case of clauses (i) and (ii), as reflected on the CVR Register as of the close of business on the date prior to the date of payment (rounded down to the nearest whole cent).
“CVR Payment Date” means a date that is no later than thirty (30) days following the receipt of the corresponding portion of Gross Proceeds by the Parent or any of its Affiliates, pursuant to which CVR Proceeds are payable to Holders.
“CVR Payment Notice” has the meaning set forth in Section 2.4(b).
“CVR Proceeds” means, without duplication: (a) if a Parent Legacy Transaction Agreement is entered into at any time on or prior to the completion of the first (1st) year of the Parent Legacy Transaction Period (including on or before the date of this Agreement), 100% of the Net Proceeds of any Parent Legacy Transaction; and (c) if a Parent Legacy Transaction Agreement is entered into during the second (2nd) year of the Parent Legacy Transaction Period, 90% of the Net Proceeds of any Parent Legacy Transaction.
“CVR Register” has the meaning set forth in Section 2.3(b).
“CVR Term” means the period beginning as of the First Effective Time and ending upon the second (2nd) anniversary of this Agreement; provided that the CVR Term shall be automatically extended until the fifteenth (15th) anniversary of this Agreement if a Parent Legacy Transaction Agreement is entered into during the Parent Legacy Transaction Period.
“Dissolution Event” means: (a) a voluntary termination of operations; (b) a general assignment for the benefit of the creditors; or (c) any other liquidation, dissolution or winding up, whether voluntary or involuntary.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“First Effective Time” has the meaning set forth in the Merger Agreement.
“Funds” has the meaning set forth in Section 6.13.
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“Gross Proceeds” means, without duplication, the sum of all cash consideration actually received by the Parent during the CVR Term in consideration for a Parent Legacy Transaction pursuant to a Parent Legacy Transaction Agreement (including any cash actually received upon the sale by the Parent or its Affiliates of any equity securities received as consideration in a Parent Legacy Transaction).
“Holder” means, at the relevant time, a Person entitled to receive payment pursuant to a CVR in accordance with this Agreement, and in whose name CVRs are registered in the CVR Register.
“Loss” has the meaning set forth in Section 3.2(g).
“Net Proceeds” means, during the CVR Term, the Gross Proceeds minus Permitted Deductions, as calculated in a manner consistent with GAAP. For clarity, (i) if Permitted Deductions exceed the Gross Proceeds as it relates to any payment event, as applicable, any excess Permitted Deductions shall be applied against Gross Proceeds in a subsequent payment event, as applicable; and (ii) if any of the Gross Proceeds or Permitted Deductions are not in U.S. dollars, currency conversion to U.S. dollars shall be made by using the exchange rate prevailing at the JPMorgan Chase Bank or its successor entity on the due date of receipt of such Gross Proceeds or due date of payment of relevant Permitted Deductions, as applicable.
“Notice” has the meaning set forth in Section 6.1.
“Officer’s Certificate” means a certificate signed by the chief executive officer and the chief financial officer of the Parent, in their respective official capacities.
“Parent Legacy Business” means the business of the Parent as conducted at any time prior to the date of the Merger Agreement, including the Parent’s and the Parent’s Subsidiaries’ right, title and interest in and to the tangible and intangible assets of the Parent or any of its Subsidiaries used in connection therewith.
“Parent Legacy Transaction Agreement” means a definitive agreement, contract or other definitive arrangement entered into by the Parent or any of its Affiliates providing for a transaction or series of transactions regarding a Parent Legacy Transaction.
“Parent Legacy Transaction Period” means the period commencing on the date of the Merger Agreement and ending on the second (2nd) anniversary of the First Effective Time.
“Parent Shares” means common shares in the authorized capital of Parent and shares of Parent Preferred Stock.
“Party” means the Parent, the Rights Agent and the Representative.
“Permitted Deductions” means the sum of:
(a) any applicable non-refundable Tax (including any applicable non-refundable value added or sales taxes or withholding Taxes) imposed on or with respect to Gross Proceeds and payable by (or withheld from) the Parent or any of its Affiliates (regardless of whether the due date for such Taxes arises during or after the Parent Legacy Transaction Period) and, without duplication, any income or other similar Taxes payable by the Parent or any of its Affiliates that would not have been incurred by the Parent or any of its Affiliates but for the Gross Proceeds; provided that, for purposes of calculating income Taxes incurred by the Parent or its Affiliates in respect of the Gross Proceeds, any such income Taxes shall be computed based on the gain recognized by the Parent or its Affiliates from the Parent Legacy Transaction after reduction for any non-capital loss carryforwards, capital loss carryforwards, or other Tax attributes of the Parent or its Affiliates in existence as of the First Effective Time that are available to offset such gain after taking into account any limits of the usability of such attributes, including under Section 382 of the Code and Section 111 of the Tax Act (and the equivalent provisions of any applicable provincial income Tax law) as determined by the Parent’s Tax advisers (and, for the sake of clarity, such income Taxes shall be calculated without taking into account any net operating losses, non-capital losses or other tax attributes generated by the Parent or its Affiliates after the First Effective Time);
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(b) any reasonable and documented expenses incurred by the Parent or any of its Affiliates in respect of its performance of this Agreement following the First Effective Time or in respect of its performance of any Contract in connection with the Parent Legacy Business (in each case, to the extent such expenses are not included in the determination of the Parent Net Cash in accordance with the Merger Agreement), including any costs related to the prosecution, maintenance or enforcement by the Parent or any of its Subsidiaries of intellectual property rights (but excluding any costs related to a breach of this Agreement, including costs incurred in litigation in respect of the same);
(c) any reasonable and documented expenses incurred or accrued by the Parent or any of its Affiliates in connection with (i) the negotiation, entry into and closing of any Parent Legacy Transaction or (ii) the maintenance and enforcement costs related to the CVRs (including fees and expenses related to the Rights Agent), including any brokerage fee, finder’s fee, opinion fee, success fee, transaction fee, service fee or other fee, commission or expense owed to any broker, finder, investment bank, auditor, accountant, counsel, advisor or other third party in relation thereto, and the CVR Expenses Cap to the extent not included in the determination of the Parent Net Cash in accordance with the Merger Agreement;
(d) any Losses incurred or reasonably executed to be incurred by the Parent or any of its Affiliates arising out of any third-party claims, demands, actions, or other proceedings relating to or in connection with any Parent Legacy Transaction, including indemnification obligations of the Parent or any of its Affiliates set forth in any Parent Legacy Transaction Agreement;
(e) any royalties or other amounts payable by the Parent or any of its Affiliates to any third party in connection with any Legacy Assets; and
(f) any Liabilities borne by the Parent or any of its Affiliates pursuant to Contracts related to the Parent Legacy Business, including costs arising from the termination thereof (in each case, only to the extent not included in the calculation of Parent Net Cash);
(g) any Liabilities existing or incurred during the CVR Term that would have been required to be included in the calculation of the Parent Net Cash in accordance with the Merger Agreement, to the extent not previously taken account in the calculation of the Parent Net Cash in accordance with the Merger Agreement.
“Permitted Transfer” means a transfer of CVRs (a) upon death of a Holder by will or intestacy; (b) pursuant to a court order; (c) by operation of law (including by consolidation or merger) or without consideration in connection with the dissolution, sale of all or substantially all of the assets, liquidation or termination of a corporation, limited liability company, partnership or other Person which is the holder thereof; (d) from a trust governed by a registered retirement savings plan, a registered retirement income fund, a deferred profit sharing plan, a registered education savings plan, a registered disability savings plan, a tax-free savings account or a first home savings account (each as defined in the Tax Act) or any equivalent trust, fund or plan under any other applicable legislation worldwide to the annuitant or subscriber of the plan or holder of the account, as the case may be; and (e) from a nominee to a beneficial owner and, if applicable, through an intermediary, to the extent allowable by DTC; or (e) as provided in Section 2.6.
“Record Time” has the meaning set forth in Section 2.3(e).
“Representative Engagement Agreement” has the meaning set forth in Section 4.5.
“Representative Expense Fund” has the meaning set forth in Section 4.5.
“Representative Expenses” has the meaning set forth in Section 4.5.
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“Representative Group” has the meaning set forth in Section 4.5.
“Rights Agent” means the Rights Agent named in the first paragraph of this Agreement, until a successor Rights Agent will have become the Rights Agent pursuant to the applicable provisions of this Agreement, and thereafter “Rights Agent” will mean such successor Rights Agent.
“Securities Act” means the Securities Act of 1933, as amended.
“Tax Act” means the Income Tax Act (Canada) and the regulations promulgated thereunder.
ARTICLE 2
CONTINGENT VALUE RIGHTS
Section 2.1 Holders of CVRs; Appointment of Rights Agent.
(a) The CVRs represent direct contractual obligations of the Parent and shall entitle each of Holders to receive CVR Proceeds in accordance with this Agreement or upon the occurrence of, or the filing of, a request to a competent authority in connection with a Dissolution Event of the Parent. The initial Holders will be the holders of record of Parent Shares as of the Record Time. One CVR will be issued with respect to each Parent Share that is outstanding as of the Record Time.
(b) The Parent and the Representative hereby appoint the Rights Agent to act as Rights Agent for the Parent in accordance with the express terms and conditions set forth in this Agreement, and the Rights Agent hereby accepts such appointment.
Section 2.2 Non-transferable. The CVRs may not be sold, assigned, transferred, pledged, encumbered or in any other manner transferred or disposed of, in whole or in part, other than through a Permitted Transfer. The CVRs will not be listed on any quotation system or traded on any securities exchange. Any attempted sale, assignment, transfer, pledge, encumbrance or disposition of CVRs, in whole or in part, in violation of this Section 2.2 shall be void ab initio and of no effect.
Section 2.3 No Certificate; Registration; Registration of Transfer; Change of Address.
(a) The CVRs will be issued and recorded on the records of the Rights Agent and will not be evidenced by a certificate, direct registration system advice or other instrument.
(b) The Rights Agent shall create and maintain a register (the “CVR Register”) for the purpose of registering CVRs and Permitted Transfers. The CVR Register will be created, and CVRs will be distributed, pursuant to written instructions to the Rights Agent from the Parent.. The Rights Agent will have no responsibility whatsoever directly or indirectly to the street name holders with respect to transfers of CVRs. With respect to any payments or issuances to be made under Section 2.4 below, the Rights Agent will accomplish the payment by way of cheque to the holder of record on the CVR Register.
(c) Subject to the restrictions on transferability set forth in Section 2.2, every request made to transfer a CVR must be in writing and accompanied by a written instrument of transfer in form reasonably satisfactory to the Rights Agent pursuant to its guidelines or procedures. If a Holder is an intermediary, such intermediary and any beneficial holder of CVRs may make a written request to the Rights Agent to re-register the applicable CVRs in the name of the beneficial holder using the form attached hereto as Schedule “A”. The written request must be duly executed by the intermediary and the applicable beneficial holder and certify that such request for re-registration does not result in a change to the beneficial entitlement to the CVR Payment for the applicable CVRs. Subject to any reasonable procedures imposed by the Rights Agent, the Rights Agent shall promptly re-register the applicable CVRs in the name of the beneficial holder upon receipt of such written request.Upon receipt of such written notice, the Rights Agent shall, subject to its reasonable determination that the transfer instrument is in proper form and the transfer otherwise complies with the other terms and conditions of this Agreement
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(including the provisions of Section 2.2), register the transfer of the CVRs in the CVR Register. The Parent and Rights Agent may require evidence of payment of a sum sufficient to cover any stamp, documentary, registration, or other Tax or governmental charge that is imposed in connection with any such registration of transfer (or evidence that such Taxes and charges are not applicable). The Rights Agent shall have no duty or obligation to take any action under any section of this Agreement that requires the payment by a Holder of a CVR of applicable taxes or charges unless and until the Rights Agent is satisfied that all such taxes or charges have been paid. All duly transferred CVRs registered in the CVR Register will be the valid obligations of the Parent and will entitle the transferee to the same benefits and rights under this Agreement as those held immediately prior to the transfer by the transferor. No transfer of a CVR will be valid until registered in the CVR Register.
(d) A Holder may make a written request to the Rights Agent to change such Holder’s address of record in the CVR Register. The written request must be duly executed by the Holder. Upon receipt of such written notice and proper validation of the identity of such Holder, the Rights Agent shall, promptly record the change of address in the CVR Register. The Parent, the Acting Holders or the Representative may make a written request to the Rights Agent for a list containing the names, addresses and number of CVRs of the Holders that are registered in the CVR Register. Upon receipt of such written request from the Acting Holders or the Representative, as applicable, the Rights Agent shall promptly deliver a copy of such list to the Acting Holders or the Representative, as applicable.
(e) The Parent will provide written instructions to the Rights Agent for the distribution of CVRs to holders of record of Parent Shares as of the close of business (Eastern Time) on November 5, 2026 (the “Record Time”). Subject to the terms and conditions of this Agreement and the Parent’s prompt confirmation of the First Effective Time, the Rights Agent shall effect the distribution of the CVRs, less any applicable tax withholding, to each holder of Parent Shares as of the Record Time by the mailing of a statement of holding reflecting such CVRs.
Section 2.4 Payment Procedures.
(a) If a Parent Legacy Transaction Agreement is entered prior to the end of the Parent Legacy Transaction Period, then the Parent and the Representative shall promptly and jointly deliver to the Rights Agent written notice indicating that a Parent Legacy Transaction Agreement has been entered into and a copy of the Parent Legacy Transaction Agreement and any ancillary agreements thereto.
(b) On or prior to each CVR Payment Date and subject to Section 4.6, the Parent and the Representative shall jointly deliver to the Rights Agent (i) written notice indicating that (A) the Holders are entitled to receive one or more payments with respect to CVR Proceeds; (B) the source and trigger event for such payment of CVR Proceeds; and (C) if applicable, a detailed calculation of Gross Proceeds (including any calculations and/or supporting documentation applicable to any allocation determination for consideration related or not related to the Parent Legacy Business), Net Proceeds and any Permitted Deductions used to calculate such CVR Proceeds with reasonable supporting detail for such Permitted Deductions and any additional source materials as reasonably requested by the Representative in respect of any of the foregoing (such notice, a “CVR Payment Notice”), (ii) a letter of instruction setting forth, for each CVR, the CVR Payment Amount with respect thereto (including each component included in the calculation thereof) and (iii) any other letter of instruction reasonably required by the Rights Agent. On or prior to any CVR Payment Date and subject to Section 4.6, the Parent shall deliver to the Rights Agent the CVR Payment Amounts required by Section 4.6. All amounts delivered by the Parent hereunder shall be delivered in U.S. dollars. For the avoidance of doubt, the Parent shall have no further liability in respect of the relevant CVR Payment Amount upon delivery of such CVR Payment Amount in accordance with this Section 2.4(b) and the satisfaction of each of the Parent’s obligations set forth in this Section 2.4(b) and Section 2.7. With respect to cash deposited by the Parent with the Approved Bank designated by the Rights Agent, the Rights Agent agrees to cause such Approved Bank to establish and maintain a separate demand
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deposit account therefor in the name of the Rights Agent for the benefit of the Parent. The Rights Agent will only draw upon cash in such account(s) as required from time to time in order to make payments as required under this Agreement and any applicable Tax withholding payments pursuant to Section 2.7(b) herein. The Rights Agent shall have no responsibility or liability for any diminution of funds that may result from any deposit made by the Rights Agent in accordance with this Section 2.4(b), including any losses resulting from a default by any bank, financial institution or other third party, in the absence of fraud, bad faith or willful misconduct by or on behalf of the Rights Agent. The Rights Agent may from time to time receive interest in connection with such deposits. The Rights Agent shall not be obligated to pay such interest to the Parent, the Representative, any Holder or any other party. The Rights Agent is acting as an agent hereunder and is not a debtor of the Parent in respect of cash deposited hereunder. For the avoidance of doubt, the Parent and Representative acknowledge that (i) the Rights Agent is not a bank or a trust company, (ii) the Rights Agent is not acting in any sort of capacity as an “escrow” or similar agent hereunder, and (iii) nothing in this Agreement shall be construed as requiring the Rights Agent to perform any services that would require registration with any governmental authority as a bank or a trust company. For greater certainty, the Rights Agent shall not be construed as having any implied or explicit fiduciary duties nor be considered a trustee to any party pursuant to the terms of this Agreement.
(c) The Rights Agent will promptly, and in any event within ten (10) Business Days after receipt of the CVR Payment Notice as well as any letter of instruction reasonably required by the Rights Agent, send each Holder at its registered address a copy of the CVR Payment Notice (at the Parent’s sole cost and expense) and, following the applicable CVR Payment Date, as soon as practicable (and in any event within thirty (30) days following such CVR Payment Notice) pay the CVR Payment Amount to each of the Holders by cheque mailed to the address of each Holder as reflected in the CVR Register as of the close of business on the CVR Payment Date; provided, that with respect to any such Holder that is due an amount in excess of $100,000 in the aggregate who has provided the Rights Agent wiring instructions in writing as of the close of business on the date set out in the CVR Payment Notice, by wire transfer of immediately available funds to the account specified on such instruction.
(d) Any portion of the CVR Payment Amount that remains undistributed to a Holder three (3) years after the applicable CVR Payment Date will be delivered by the Rights Agent to the Parent, upon demand, and any Holder will thereafter look only to the Parent for payment of the CVR Payment Amount, without interest, but such Holder will have no greater rights against the Parent than those accorded to general unsecured creditors of the Parent under applicable Law.
(e) None of the Parent, any of its Affiliates, or the Rights Agent will be liable to any Person in respect of the CVR Payment Amount delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law If, despite the Parent’s, any of its Affiliates’ or the Rights Agent’s commercially reasonable efforts to deliver the CVR Payment Amount to the applicable Holder, the CVR Payment Amount has not been paid prior to six (6) years after the applicable CVR Payment Date (or immediately prior to such earlier date on which the CVR Payment Amount would otherwise escheat to any Governmental Body), the CVR Payment Amount will become the property of the Parent, to the extent permitted by applicable Law, free and clear of all claims or interest of any Person previously entitled thereto. If the CVR Payment Amount does not become the property of the Parent as per applicable Law upon transfer by the Rights Agent, such Holder will thereafter look only to the Parent for payment of the CVR Payment Amount, without interest, and the Parent will be responsible for escheatment to the applicable Governmental Body. The Rights Agent will not be responsible for escheatment of abandoned property except in the case that the Parent is unable to provide the Rights Agent with the applicable wire instructions to transfer such property to the Parent before the CVR Proceeds would escheat to the applicable Governmental Body. In addition to and not in limitation of any other indemnity obligation herein, the Parent agrees to indemnify and hold harmless the Rights Agent with respect to any liability, penalty, cost or expense the Rights Agent may incur or be subject to in connection with transferring such property to the Parent.
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Section 2.5 No Voting, Dividends or Interest; No Equity or Ownership Interest.
(a) If and when issued, the CVRs will not have any voting or dividend rights, and interest will not accrue on any amounts payable in respect of CVRs to any Holder.
(b) If and when issued, the CVRs will not represent any equity or ownership interest in the Parent or in any constituent company to the Merger. It is hereby acknowledged and agreed that a CVR shall not constitute a security of the Parent.
(c) Nothing contained in this Agreement shall be construed as conferring upon any Holder, by virtue of the CVRs, any rights or obligations of any kind or nature whatsoever as a shareholder of the Parent or any of its Subsidiaries either at law or in equity. The rights of any Holder and the obligations of the Parent and its Affiliates and their respective officers, directors and controlling Persons are contract rights limited to those expressly set forth in this Agreement.
(d) It is hereby acknowledged and agreed that the CVRs and the possibility of any payment hereunder with respect thereto are highly speculative and subject to numerous factors outside of the Parent’s control, and there is no assurance that Holders will receive any payments under this Agreement or in connection with the CVRs. Each Holder acknowledges that it is highly possible that no Parent Legacy Transaction will occur prior to the expiration of the Parent Legacy Transaction Period and that there will not be any Gross Proceeds that may be the subject of a CVR Payment Amount. It is further acknowledged and agreed that neither the Parent nor its Affiliates owe, by virtue of their obligations under this Agreement, a fiduciary duty or any implied duties to the Holders and the parties hereto intend solely the express provisions of this Agreement to govern their contractual relationship with respect to the CVRs. It is acknowledged and agreed that this Section 2.5(d) is an essential and material term of this Agreement and that in no event shall the Parent, its board of directors or its officers and Affiliates be deemed to have any fiduciary or similar duties to any Holder by virtue of this Agreement.
Section 2.6 Ability to Abandon CVR. A Holder may at any time, at such Holder’s option, abandon all of such Holder’s remaining rights represented by CVRs by transferring such CVR to the Parent or a Person nominated in writing by the Parent (with written notice thereof from the Parent to the Representative and the Rights Agent) without consideration in compensation therefor, and such rights will be cancelled, with the Rights Agent being promptly notified in writing by the Parent of such transfer and cancellation. Nothing in this Agreement is intended to prohibit the Parent or its Affiliates from offering to acquire or acquiring CVRs, in private transactions or otherwise, for consideration in its sole discretion.
Section 2.7 Tax Matters.
(a) The Parent and the Representative intend that, (i) for all U.S. federal and applicable state and local income Tax purposes, the issuance of the CVRs pursuant to Section 2.1 of this Agreement is intended to be treated as a distribution of property (and not debt or equity of the Parent) by the Parent to its shareholders governed by Section 301 of the Code and Canadian tax treatment and (ii) for all applicable Canadian, U.S. federal and applicable provincial, state and local income Tax purposes, any CVR Payment Amount (if any) is intended to be treated as a contractual payment pursuant to the rights afforded by this Agreement to the Holder and not as a distribution by the Parent in respect of common shares in the Parent. The Parent and its Affiliates (including the Parent after the Merger) shall (and the Parent shall instruct the Rights Agent to) report to the extent required by applicable Law for all Tax purposes in a manner consistent with the foregoing, and none of the parties will take any position to the contrary on any Canadian, U.S. federal, state and local Tax Returns or for other Canadian, U.S. federal and applicable state and local income Tax purposes, unless otherwise required by changes in applicable Law or a “determination” within the meaning of Section 1313(a) of the Code (or a similar determination under applicable state or local Law).
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In addition to any Permitted Deductions, the Parent and its Affiliates (including the Parent after the Merger) and the Rights Agent shall be entitled to, and the Parent will instruct the Rights Agent or its applicable Affiliate to, deduct and withhold, or cause to be deducted or withheld, from each CVR Payment Amount or any other amounts otherwise payable pursuant to this Agreement such amounts as may be required to be deducted and withheld therefrom under applicable Tax Law. Prior to making (or causing to be made) any Tax deduction or withholding pursuant to this Section 2.7(b), the Rights Agent will (and the Parent shall instruct the Rights Agent to) provide the opportunity for the Holders to provide properly completed and duly executed Internal Revenue Service Forms W-9 or applicable Forms W-8, as applicable, or any other reasonably appropriate forms or information from Holders in order to eliminate or reduce withholding. The Rights Agent shall and the Parent shall (or shall cause its applicable Affiliate to), as applicable, promptly and timely remit, or cause to be promptly and timely remitted, any amounts withheld in respect of Taxes to the appropriate Governmental
(b) Body. To the extent any amounts are so deducted or withheld, such amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of whom such deduction and withholding was made. Promptly following such withholding, the Parent will (or will instruct its applicable Affiliate or the Rights Agent to) deliver to the Person to whom such amounts would otherwise have been paid reasonably acceptable evidence of such withholding. Any amounts not withheld by the Parent or the Rights Agent on the issuance of CVRs to the Holders or any payments to the Holders under this Agreement (including CVR Payment Amounts) and subsequently determined to have been required to be withheld by the Parent by any relevant governmental entity shall be paid by the Holders through a deduction from future CVR Payment Amounts payable to the applicable Holder(s). In connection with the distribution of CVRs to the Holders, the Parent, the Rights Agent and the Representative shall be entitled to make reasonable estimations of the Parent’s “earnings and profits” (as such term is defined for U.S. federal income Tax purposes (including the adjustments described in Section 312 of the Code), and shall be entitled to adopt the withholding Tax procedures described in Treasury Regulations Section 1.1441-3(c)(2)(ii) in connection with the foregoing).
ARTICLE 3
THE RIGHTS AGENT
Section 3.1 Certain Duties and Responsibilities.
(a) The Rights Agent will not have any liability for any actions taken or not taken in connection with this Agreement, except to the extent such liability arises as a result of the willful misconduct, bad faith, fraud or gross negligence of the Rights Agent (in each case as determined by a final non-appealable judgment of court of competent jurisdiction). Notwithstanding anything in this Agreement to the contrary, any liability of the Rights Agent under this Agreement will be limited to the amount of annual fees paid by the Parent to the Rights Agent in connection with this Agreement (but not including reimbursable expenses and other charges) during the twelve (12) months immediately preceding the event for which recovery from the Rights Agent is being sought. Anything to the contrary notwithstanding, in no event will the Rights Agent be liable for special, punitive, indirect, incidental or consequential loss or damages of any kind whatsoever (including, without limitation, lost profits), even if the Rights Agent has been advised of the likelihood of such loss or damages, and regardless of the form of action.
(b) The Rights Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any Holder with respect to any action or default by any person or entity, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Parent or Mentari. The Rights Agent may (but shall not be required to) enforce all rights of action under this Agreement and any related claim, action, suit, audit, investigation or proceeding instituted by the Rights Agent may be brought in its name as the Rights Agent and any recovery in connection therewith will be for the proportionate benefit of all the Holders, as their respective rights or interests may appear on the CVR Register.
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Section 3.2 Certain Rights of Rights Agent.
(a) The Rights Agent undertakes to perform such duties and only such duties as are specifically set forth in this Agreement, and no implied covenants or obligations will be read into this Agreement against the Rights Agent.
(b) The Rights Agent may rely and will be protected by the Parent in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order or other paper or document reasonably believed by it to be genuine and to have been signed or presented by or on behalf of the Parent or, with respect to Section 2.3(d), the Representative.
(c) Whenever the Rights Agent deems it desirable that a matter be proved or established prior to taking or omitting any action hereunder, the Rights Agent may rely upon an Officer’s Certificate, which certificate shall be full authorization and protection to the Rights Agent, and the Rights Agent shall, in the absence of bad faith, gross negligence, fraud or willful misconduct (each as determined by a final non-appealable judgment of a court of competent jurisdiction) on its part, not incur any liability and shall be held harmless by the Parent for or in respect of any action taken or omitted to be taken by it under the provisions of this Agreement in reliance upon such Officer’s Certificate.
(d) The Rights Agent may engage and consult with counsel of its selection, and the advice or opinion of such counsel will, in the absence of bad faith, gross negligence, fraud or willful misconduct (in each case, as determined by a final, non-appealable judgment of a court of competent jurisdiction) on the part of the Rights Agent, be full and complete authorization and protection in respect of any action taken or not taken by the Rights Agent in reliance thereon.
(e) Any permissive rights of the Rights Agent hereunder will not be construed as a duty.
(f) The Rights Agent will not be required to give any note or surety in respect of the execution of its powers or otherwise under this Agreement.
(g) The Parent agrees to indemnify the Rights Agent for, and to hold the Rights Agent and its affiliates, officers, directors, employees, agents, successors and assigns (the “Indemnified Parties”) harmless from and against, any loss, liability, damage, judgment, fine, penalty, cost or expense (each, a “Loss”) suffered or incurred by the Indemnified Parties and arising out of or in connection with the Rights Agent’s performance of its obligations under this Agreement, including the reasonable and documented costs and expenses of defending the Rights Agent against any claims, charges, demands, actions or suits arising out of or in connection with the execution, acceptance, administration, exercise and performance of its duties under this Agreement, including the costs and expenses of defending against any claim of liability arising therefrom, directly or indirectly, or enforcing its rights hereunder, except to the extent such Loss has been determined by a final non-appealable decision of a court of competent jurisdiction to have resulted from the Rights Agent’s gross negligence, bad faith, fraud or willful misconduct.
(h) The Parent agrees (i) to pay the fees of the Rights Agent in connection with the Rights Agent’s performance of its obligations hereunder as set forth in Exhibit A and agreed upon in writing by the Rights Agent and the Parent on or prior to the date of this Agreement, and (ii) to reimburse the Rights Agent for all reasonable and documented out-of-pocket expenses and other disbursements incurred in the preparation, delivery, negotiation, amendment, administration and execution of this Agreement and the exercise and performance of its duties hereunder, including all stamp and transfer Taxes and governmental charges, incurred by the Rights Agent in the performance of its obligations under this Agreement, except that the Parent will have no obligation to pay the fees of the Rights Agent or reimburse the Rights Agent for the fees of counsel in connection with any lawsuit initiated by the Rights Agent on behalf of itself or the Holders, except in the case of any suit enforcing the provisions of Section 2.4(a), Section 2.4(b) or Section 3.2(g), if the Parent is found by a court of competent jurisdiction to be liable to the Rights Agent or the Holders, as applicable in such suit.
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(i) No provision of this Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it believes that repayment of such funds or adequate indemnification against such risk or liability is not reasonably assured to it.
(j) The Rights Agent shall have no responsibility to the Parent, any holders of CVRs, any holders of Parent Shares or any other Person for interest or earnings on any moneys held by the Rights Agent pursuant to this Agreement.
(k) The Rights Agent shall not be subject to, nor be required to comply with, or determine if any Person has complied with, the Merger Agreement or any other agreement between or among any the Parent, Mentari or Holders, even though reference thereto may be made in this Agreement, or to comply with any notice, instruction, direction, request or other communication, paper or document other than as expressly set forth in this Agreement.
(l) Subject to applicable Law, (i) the Rights Agent and any shareholder, affiliate, director, officer or employee of the Rights Agent may buy, sell or deal in any securities of the Parent or Mentari or become peculiarly interested in any transaction in which such parties may be interested, or contract with or lend money to such parties or otherwise act as fully and freely as though it were not the Rights Agent under this Agreement, and (ii) nothing herein will preclude the Rights Agent from acting in any other capacity for the Parent or for any other Person.
(m) In the event the Rights Agent reasonably believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request or other communication, paper or document received by the Rights Agent hereunder, the Rights Agent shall, as soon as practicable, provide notice to the Parent and the Representative, and the Rights Agent, may, in its sole discretion, refrain from taking any action, and shall be fully protected and shall not be liable in any way to the Parent or any Holder or any other Person for refraining from taking such action, unless the Rights Agent receives written instructions from the Parent, the Representative or such Holder or other Person which eliminate such ambiguity or uncertainty to the reasonable satisfaction of the Rights Agent;
(n) The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by or through its attorney or agents and the Rights Agent shall not be answerable or accountable for any act, default, neglect or misconduct of any such attorney or agents or for any loss to the Parent or Mentari resulting from any such act, default, neglect or misconduct, absent gross negligence, bad faith, fraud or willful misconduct (each as determined by a final non-appealable judgment of a court of competent jurisdiction) in the selection and continued employment thereof.
(o) The Rights Agent shall not be liable for or by reason of any statements of fact or recitals contained in this Agreement (except its countersignature thereof) or be required to verify the same, and all such statements and recitals are and shall be deemed to have been made by the Parent only.
(p) The Rights Agent shall act hereunder solely as agent for the Parent and shall not assume any obligations or relationship of agency or trust with any of the owners or holders of the CVRs. The Rights Agent shall not have any duty or responsibility in the case of the receipt of any written demand from any Holders with respect to any action or default by the Parent, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or to make any demand upon the Parent.
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(q) The Rights Agent may rely on and be fully authorized and protected in acting or failing to act upon (a) any guaranty of signature by an “eligible guarantor institution” that is a member or participant in the Securities Transfer Agents Medallion Program or other comparable “signature guarantee program” or insurance program in addition to, or in substitution for, the foregoing; or (b) any law, act, regulation or any interpretation of the same even though such law, act, or regulation may thereafter have been altered, changed, amended or repealed.
(r) The Rights Agent shall not be liable or responsible for any failure of the Parent to comply with any of its obligations relating to any registration statement filed with the Securities and Exchange Commission or this Agreement, including without limitation obligations under applicable regulation or law.
(s) The obligations of the Parent and the rights of the Rights Agent under this Section 3.2, Section 3.1 and Section 2.4 shall survive the expiration of the CVRs and the termination of this Agreement and the resignation, replacement or removal of the Rights Agent.
Section 3.3 Resignation and Removal; Appointment of Successor.
(a) The Rights Agent may resign at any time by written notice to the Parent and the Representative. Any such resignation notice shall specify the date on which such resignation will take effect (which shall be at least thirty (30) days following the date that such resignation notice is delivered), and such resignation will be effective on the earlier of (x) the date so specified and (y) the appointment of a successor Rights Agent.
(b) The Parent and the Representative will have the right to jointly remove the Rights Agent at any time by written notice to the Rights Agent, specifying the date on which such removal will take effect. Such notice will be given at least thirty (30) days prior to the date so specified (or, if earlier, the appointment of the successor Rights Agent).
(c) If the Rights Agent resigns, is removed or becomes incapable of acting, the Parent and the Representative will promptly jointly appoint a qualified successor Rights Agent. Notwithstanding the foregoing, if the Parent and the Representative fail to make such appointment within a period of thirty (30) days after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent, then the incumbent Rights Agent may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. The successor Rights Agent so appointed will, upon its acceptance of such appointment in accordance with this Section 3.3(c) and Section 3.4, become the Rights Agent for all purposes hereunder.
(d) The Parent will give notice to the Holders of each resignation or removal of the Rights Agent and each appointment of a successor Rights Agent in accordance with Section 6.2. Each notice will include the name and address of the successor Rights Agent. If the Parent fails to send such notice within ten (10) Business Days after acceptance of appointment by a successor Rights Agent, the successor Rights Agent will cause the notice to be mailed at the expense of the Parent.
(e) Notwithstanding anything to the contrary in this Section 3.3, unless consented to in writing by the Representative, the Parent and the Representative will not appoint as a successor Rights Agent any Person that is not a stock transfer agent of national reputation or the corporate trust department of a commercial bank.
(f) The Rights Agent will reasonably cooperate with the Parent and any successor Rights Agent in connection with the transition of the duties and responsibilities of the Rights Agent to the successor Rights Agent, including the transfer of all relevant data, including the CVR Register, to the successor Rights Agent, but such predecessor Rights Agent shall not be required to make any additional expenditure or assume any additional liability in connection with the foregoing.
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Section 3.4 Acceptance of Appointment by Successor. Every successor Rights Agent appointed hereunder will, at or prior to such appointment, execute, acknowledge and deliver to the Parent, the Representative and to the resigning or removed Rights Agent an instrument accepting such appointment and a counterpart of this Agreement, and such successor Rights Agent, without any further act, deed or conveyance, will become vested with all the rights, powers, trusts and duties of the Rights Agent; provided that upon the request of the Parent, the Representative or the successor Rights Agent, such resigning or removed Rights Agent will execute and deliver an instrument transferring to such successor Rights Agent all the rights, powers and trusts of such resigning or removed Rights Agent.
Section 3.4 Documents, Monies, Etc. Held by CVR Agent. Any monies, securities, documents of title or other instruments that may at any time be held by the CVR Agent shall be placed in the deposit vaults of the CVR Agent or at (a) Truist Bank; (b) BMO Bank N.A; or (c) such other banking institution that the CVR Agent has a commercial relationship with (each such bank being an “Approved Bank”), or deposited for safekeeping with any such bank. Any monies held pending the application or withdrawal thereof under any provisions of this Agreement, shall be held in a segregated non-interest-bearing bank account of the CVR Agent. All amounts held by the CVR Agent pursuant to this Agreement shall be held by the CVR Agent for the Parent and the delivery of the funds to the CVR Agent shall not give rise to a debtor-creditor or other similar relationship. The amounts held by the CVR Agent pursuant to this Agreement are at the sole risk of the Parent and, without limiting the generality of the foregoing, the CVR Agent shall have no responsibility or liability for any diminution of the funds which may result from any deposit made with an Approved Bank pursuant to this Section 3.4, including any losses resulting from a default by the Approved Bank or other credit losses (whether or not resulting from such a default). The parties hereto acknowledge and agree that the CVR Agent will have acted prudently in depositing the funds at any Approved Bank, and that the CVR Agent is not required to make any further inquiries in respect of any such bank. The CVR Agent may hold cash balances constituting part or all of such monies and need not, invest same; the CVR Agent shall not be liable to account for any profit to any parties to this Agreement or to any other Person or entity.
ARTICLE 4
COVENANTS
Section 4.1 List of Holders. The Parent will furnish or cause to be furnished to the Rights Agent, in such form as the Parent receives from the Parent’s transfer agent (or other agent performing similar services for the Parent), the names and addresses of the Holders within fifteen (15) Business Days following the date of the First Effective Time.
Section 4.2 No Obligations of Public Parent. Notwithstanding anything herein to the contrary, and for the avoidance of doubt, (a) the Parent and its Affiliates shall have the power and right to control all aspects of their businesses and operations (and all of their assets and products), and subject to its compliance with the terms of this Agreement, the Parent and its Affiliates may exercise or refrain from exercising such power and right as it may deem appropriate and in the best overall interests of the Parent and its Affiliates and its and their stockholders, rather than the interest of the Holders, (b) none of the Parent or any of its Affiliates (or any directors, officer, employee, or other representative of the foregoing) owes any fiduciary duty or similar duty to any Holder in respect of the Parent Legacy Business, and (c) following the Parent Legacy Transaction Period, the Parent shall be permitted to take any action in respect of the Parent Legacy Business in order to satisfy any wind-down and termination Liabilities of the Parent Legacy Business. For the avoidance of doubt, after the Parent Legacy Transaction Period, the Parent shall not be required to use any efforts to pursue one or more Parent Legacy Transactions with respect to the Parent Legacy Business. Without limiting the foregoing, during the Parent Legacy Transaction Period, the Parent shall expend up to $100,000 (the “CVR Expense Cap”) for costs and expenses associated with the retention of an employee or consultant of the Parent for the purpose of business development efforts related to the Parent Legacy Business and related activities, including seeking and negotiating and, with the prior written consent of the
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Parent (not to be unreasonably withheld, conditioned or delayed), executing Parent Legacy Transaction Agreements, which amount shall be included as a deduction in the determination of the Parent Net Cash in accordance with the Merger Agreement. Notwithstanding anything to the contrary in this Agreement, at the end of the Parent Legacy Transaction Period, the amount, if any, by which the CVR Expense Cap exceeds the aggregate amount of costs and expenses associated with the retention of an employee or consultant of the Parent for the purpose of business development efforts related to the Parent Legacy Business and related activities, including seeking and negotiating and, with the prior written consent of the Parent (not to be unreasonably withheld, conditioned or delayed), executing Parent Legacy Transaction Agreements, shall constitute Net Proceeds and shall be payable as CVR Proceeds to the Holders in accordance with the terms of this Agreement. Notwithstanding anything to the contrary in this Agreement, the Parent shall, and shall cause its Affiliates to: act in good faith to complete a Parent Legacy Transaction (including to use commercially reasonable efforts during the Parent Legacy Transaction Period to maintain the intellectual property (including patents) of the Parent Legacy Business in existence on or prior to the First Effective Time) and not take any action or fail to take any action, in either case, with the primary purpose (and not merely the effect) of avoiding, or intending to prevent or materially delay, (x) during the Parent Legacy Transaction Period, the entry into any Parent Legacy Transaction Agreement, or (y) during the CVR Term, the receipt of Gross Proceeds or the payment of any CVR Proceeds.
Section 4.3 Books and Records. Until the end of the CVR Term, the Parent shall, and shall cause its Affiliates to, keep true, complete and accurate records in sufficient detail to enable the Holders and the Rights Agent to confirm the applicable CVR Payment Amount payable hereunder in accordance with the terms specified in this Agreement.
Section 4.4 Audits. Until the expiration of this Agreement and for a period of the later of one (1) year thereafter or as required by applicable Law (the “Audit Right End Date”), the Parent shall keep complete and accurate records in sufficient detail to support the accuracy of the payments due hereunder. The Representative shall have the right to cause the Accounting Firm to audit such records for the sole purpose of confirming payments for a period covering not more than the date commencing with the first CVR Payment Date and ending on the last day of the CVR Term. The Parent may require the Accounting Firm to execute a reasonable confidentiality agreement with the Parent prior to commencing the audit. The Accounting Firm shall disclose to Rights Agent or the Representative, as applicable, only whether the reports are correct or not and the specific details concerning any discrepancies. No other information shall be shared. Such audits may be conducted during normal business hours upon reasonable prior written notice to the Parent, but no more than frequently than once per year. No accounting period of the Parent shall be subject to audit more than one time by the Representative, as applicable, unless after an accounting period has been audited by the Representative, as applicable, the Parent restates its financial results for such accounting period, in which event the Representative, as applicable, may conduct a second audit of such accounting period in accordance with this Section 4.4. Adjustments (including remittances of underpayments or overpayments disclosed by such audit) shall be made by the Parent to reflect the results of such audit, which adjustments shall be paid promptly following receipt of an invoice therefor. Whenever such an adjustment is made, the Parent shall promptly prepare a certificate setting forth such adjustment, and a brief, reasonably detailed statement of the facts, computation and methodology accounting for such adjustment to the extent not already reflected in the audit report and promptly file with the Rights Agent a copy of such report and promptly deliver to the Rights Agent a revised CVR Payment Notice for the applicable CVR Proceeds. The Rights Agent shall be fully protected in relying on any such report and on any adjustment or statement therein contained and shall have no duty or liability with respect to, and shall not be deemed to have knowledge of any such adjustment or any such event unless and until it shall have received such report. Absent manifest error, the decision of the Accounting Firm shall be final, conclusive and binding on Parent and the Holders, shall be non-appealable and shall not be subject to further review. The Representative shall bear the full cost and expense of such audit unless such audit discloses an underpayment by Parent of ten percent (10%) or more of the CVR Payment Amount due under this Agreement, in which case the Parent shall bear the full cost and expense of such audit. The Rights Agent shall be entitled to rely on any audit report delivered by the independent Accounting Firm pursuant to this Section 4.4.
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Section 4.5 Representative. Certain Holders may enter into an engagement agreement (the “Representative Engagement Agreement”) with the Representative and provide direction to the Representative in connection with its services under this Agreement and the Representative Engagement Agreement (such Holders, including their individual representatives, collectively hereinafter referred to as the “Advisory Group”). Neither the Representative nor its members, managers, directors, officers, contractors, agents and employees nor any member of the Advisory Group (collectively, the “Representative Group”), shall be liable to any Holder for any action or failure to act in connection with the acceptance or administration of the Representative’s responsibilities hereunder or under the Representative Engagement Agreement, unless and only to the extent such action or failure to act constitutes gross negligence, fraud, willful breach or willful or intentional misconduct. The Holders shall indemnify, defend and hold harmless the Representative Group from and against any and all losses, claims, damages, liabilities, fees, costs, expenses (including fees, disbursements and costs of counsel and other skilled professionals and in connection with seeking recovery from insurers), judgments, fines, amounts paid in settlement (collectively, the “Representative Expenses”) incurred without gross negligence, fraud, willful breach or willful or intentional misconduct on the part of the Representative and arising out of or in connection with the acceptance or administration of its duties hereunder or its duties (or any duties of any member of the Advisory Group) under the Representative Engagement Agreement. Such Representative Expenses may be recovered first, from the Representative Expense Fund, second, from any distribution of CVR Payment Amounts otherwise distributable to the Holders at the time of distribution, and third, directly from the Holders. The immunities and rights to indemnification shall survive the resignation or removal of the Representative or its duties (or any duties of any member of the Advisory Group) under the Representative Engagement Agreement or any termination of this Agreement or the Representative Engagement Agreement. The Holders acknowledge that the Representative shall not be required to expend or risk its own funds or otherwise incur any financial liability in the exercise or performance of any of its powers, rights, duties or privileges or pursuant to this Agreement or the transactions contemplated hereby or thereby. Furthermore, the Representative shall not be required to take any action unless the Representative has been provided with funds, security or indemnities which, in its reasonable determination, are sufficient to protect the Representative against the costs, expenses and liabilities which may be incurred by the Representative in performing such actions. The powers, immunities and rights to indemnification granted to the Representative Group hereunder: (i) are coupled with an interest and shall be irrevocable and survive the death, incompetence, bankruptcy or liquidation of any Holder and shall be binding on any successor thereto, and (ii) shall survive the delivery of an assignment by any Holder of the whole or any fraction of his, her or its interest in the CVR Proceeds. Following the designation of the Representative, the Parent shall promptly wire to the Representative $75,000, which shall be held by the Representative in a segregated client account and shall be used (A) for the purposes of paying directly or reimbursing the Representative for any Representative Expenses not otherwise reimbursed by the Parent that are incurred pursuant to this Agreement or the Representative Engagement Agreement, or (B) as otherwise determined by the Advisory Group (such fund, the “Representative Expense Fund”). The Representative is not providing any investment supervision, recommendations or advice and shall have no responsibility or liability for any loss of principal of the Representative Expense Fund other than as a result of its gross negligence, fraud, willful breach or willful or intentional misconduct. The Representative is not acting as a withholding agent or in any similar capacity in connection with the Representative Expense Fund and has no tax reporting or income distribution obligations with respect to the Representative Expense Fund. The Holders will not receive any interest on the Representative Expense Fund and assign to the Representative any such interest. Subject to the prior written approval of the Advisory Group, the Representative may instruct the Rights Agent to contribute funds to the Representative Expense Fund from
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the CVR Payment Amounts otherwise distributable to any Holders, on a pro rata basis. As soon as reasonably determined by the Representative that the Representative Expense Fund is no longer required to be withheld, the Representative shall distribute the remaining Representative Expense Fund, if any, to the Rights Agent for further distribution to the Holders in such proportions as though the amount of the remaining Representative Expense Fund constituted CVR Proceeds hereunder (provided, that, any amounts remaining from the amounts contributed to the Representative Expense Fund from the CVR Payment Amounts otherwise distributable to any Holders pursuant to the previous sentence shall first be distributed to such Holders in proportion to such Holders’ respective contributions).
Section 4.6 Payment of CVR Payment Amounts. The Parent shall, promptly and in any event within five (5) Business Days following receipt of a payment of CVR Proceeds, deposit with the Rights Agent, by wire transfer of immediately available funds, for payment to the Holders in accordance with Section 2.4, the aggregate amount necessary to pay the CVR Payment Amount to each Holder; provided, that the Parent shall aggregate multiple payments of CVR Proceeds until the earlier to occur of (i) the aggregate amount of such CVR Proceeds reaching $100,000, or (ii) one hundred twenty (120) days following the applicable CVR Payment Date and that such exception does not apply to the final payment of CVR Proceeds which shall occur no later than thirty (30) days following the applicable CVR Payment Date; provided, that the Parent shall provide the Representative with written notice within five (5) Business Days each time Gross Proceeds are received but held pending the aggregation threshold set forth in this proviso. Upon such instruction, the CVR Agent shall cause to be mailed to the address of each Holder last appearing on the CVR Register (i) a copy of the CVR Payment Notice, and (ii) a cheque in the name of such Holder representing the CVR Payment Amount payable to the holder in accordance with the calculations set out in the CVR Payment Notice. It is agreed that cheques will be drawn on a designated account maintained by the CVR Agent.
Section 4.7 Prohibited Actions. Unless approved by the Representative (not to be unreasonably withheld, conditioned or delayed), prior to the end of the CVR Term, the Parent shall not grant any lien, security interest, pledge or similar interest solely in respect of the Parent Legacy Business or any Net Proceeds separate and apart from any other assets of the Parent.
ARTICLE 5
AMENDMENTS
Section 5.1 Amendments Without Consent of Holders or Rights Agent.
(a) The Parent, at any time and from time to time, may (without the consent of any Person, other than the Rights Agent, with such consent not to be unreasonably withheld, conditioned or delayed) enter into one or more amendments to this Agreement for any of the following purposes:
(i) to evidence the appointment of another Person as a successor Rights Agent and the assumption by any successor Rights Agent of the covenants and obligations of the Rights Agent herein in accordance with the provisions hereof;
(ii) to evidence the succession of another person to the Parent and the assumption of any such successor of the covenants of the Parent;
(iii) to add to the covenants of the Parent such further covenants, restrictions, conditions or provisions as the Parent and the Rights Agent will consider to be for the protection and benefit of the Holders; provided that in each case, such provisions do not adversely affect the interests of the Holders;
(iv) to cure any ambiguity, to correct or supplement any provision in this Agreement that may be defective or inconsistent with any other provision in this Agreement, or to make any other provisions with respect to matters or questions arising under this Agreement; provided that, in each case, such provisions do not adversely affect the interests of the Holders;
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(v) as may be necessary or appropriate to ensure that the CVRs are not subject to registration under the Securities Act or the Exchange Act and the rules and regulations promulgated thereunder, or any applicable state securities or “blue sky” laws;
(vi) as may be necessary or appropriate to ensure that the Parent is not required to produce a prospectus or an admission document in order to comply with applicable Law;
(vii) to cancel the CVRs (i) in the event that any Holder has abandoned its rights in accordance with Section 2.6, (ii) in order to give effect to the provisions of Section 2.7 or (iii) following a transfer of such CVRs to the Parent or its Affiliates in accordance with Section 2.2 or Section 2.3;
(viii) as may be necessary or appropriate to ensure that the Parent complies with applicable Law; or
(ix) to effect any other amendment to this Agreement for the purpose of adding, eliminating or changing any provisions of this Agreement, provided that, in each case, such additions, eliminations or changes do not adversely affect the interests of the Holders.
(b) Promptly after the execution by the Parent of any amendment pursuant to this Section 5.1, the Parent will (or will cause the Rights Agent to) notify the Holders in general terms of the substance of such amendment in accordance with Section 6.2.
Section 5.2 Amendments with Consent of Holders.
(a) In addition to any amendments to this Agreement that may be made by the Parent without the consent of any Holder pursuant to Section 5.1, with the consent of the Representative (whether evidenced in a writing or taken at a meeting of the Holders), the Parent and the Rights Agent may enter into one or more amendments to this Agreement for the purpose of adding, eliminating or amending any provisions of this Agreement, even if such addition, elimination or amendment is adverse to the interests of the Holders.
(b) Promptly after the execution by the Parent and the Rights Agent of any amendment pursuant to the provisions of this Section 5.2, the Parent will (or will cause the Rights Agent to) notify the Holders in general terms of the substance of such amendment in accordance with Section 6.2.
Section 5.3 Effect of Amendments.
Upon the execution of any amendment under this Article 5, this Agreement will be modified in accordance therewith, such amendment will form a part of this Agreement for all purposes and every Holder will be bound thereby. Upon the delivery of a certificate from an appropriate officer of the Parent which states that the proposed supplement or amendment is in compliance with the terms of this Section 5, the Rights Agent shall execute such supplement or amendment. Notwithstanding anything in this Agreement to the contrary, the Rights Agent shall not be required to execute any supplement or amendment to this Agreement that it has determined would adversely affect its own rights, duties, obligations or immunities under this Agreement. No supplement or amendment to this Agreement shall be effective unless duly executed by the Rights Agent.
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ARTICLE 6
MISCELLANEOUS
Section 6.1 Notices to Rights Agent and to the Parent. All notices, requests and other communications (each, a “Notice”) to any party hereunder shall be in writing and shall be deemed to have been duly delivered and received hereunder (a) one (1) Business Day after being sent for next Business Day delivery, fees prepaid, via a reputable international overnight courier service, (b) upon delivery in the case of delivery in person, by FedEx or other internationally recognized overnight courier service or (c) on the date delivered in the place of delivery if sent by email or facsimile (with a written or electronic confirmation of delivery) prior to 6:00 p.m. (New York City time), otherwise on the next succeeding Business Day, in each case to the intended recipient as set forth below:
if to the Rights Agent, to:
Odyssey Transfer and Trust Company
860 Gentian Rd, Suite 320
Eagan, MN 55121
Attention: [***]
Email: [***]
if to the Parent, to:
Mentari Therapeutics, Inc.
221 Crescent Street, Building 23, Suite 105
Waltham, MA 02453
Attention: [***]
Email: [***]
with a copy, which shall not constitute notice, to:
Gibson, Dunn & Crutcher LLP
One Embarcadero Center, Suite 2600
San Francisco, CA 94111
Attention: [***]
Email: [***]
if to the Representative to:
Indigo CVR Services Inc.
1800 – 510 West Georgia St.
Vancouver, BC V6B 0M3
Attention: [***]
Email: [***]
with a copy, which shall not constitute notice, to:
Norton Rose Fulbright Canada LLP
1800 – 510 West Georgia St.
Vancouver, BC V6B 0M3
Attention: [***]
Email: [***]
or to such other address or facsimile number as such party may hereafter specify for the purpose by notice to the other parties hereto.
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Section 6.2 Notice to Holders. All Notices required to be given to the Holders will be given (unless otherwise herein expressly provided) in writing and mailed, first-class postage prepaid, to each Holder at such Holder’s address as set forth in the CVR Register, not later than the latest date, and not earlier than the earliest date, prescribed for the sending of such Notice, if any, and will be deemed given on the date of mailing. In any case where notice to the Holders is given by mail, neither the failure to mail such Notice, nor any defect in any Notice so mailed, to any particular Holder will affect the sufficiency of such Notice with respect to other Holders.
Section 6.3 Entire Agreement. As between the Parent and the Rights Agent, this Agreement constitutes the entire agreement between the parties with respect to the subject matter of this Agreement, notwithstanding the reference to any other agreement herein, and supersedes all prior agreements and understandings, both written and oral, among or between any of the parties with respect to the subject matter of this Agreement.
Section 6.4 Merger or Consolidation or Change of Name of Rights Agent. Any Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or Person resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the stock transfer or other shareholder services business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 3.3. The purchase of all or substantially all of the Rights Agent’s assets employed in the performance of transfer agent activities shall be deemed a merger or consolidation for purposes of this Section 6.4.
Section 6.5 Successors and Assigns. This Agreement will be binding upon, and will be enforceable by and inure solely to the benefit of, the Holders, the Parent and the Rights Agent and their respective successors and assigns. Except for assignments pursuant to Section 6.4, the Rights Agent may not assign this Agreement without the prior written consent of each of the Parent and the Representative. Subject to Section 5.1(a)(ii) and Article 6 hereof, the Parent may assign, in its sole discretion and without the consent of any other party, any or all of its rights, interests and obligations hereunder to one or more of its controlled Affiliates or, with the prior written consent of the Acting Holders, to any other Person (each, an “Assignee”); provided, that in connection with any assignment to an Assignee, the Parent shall agree to remain liable for the performance by the Parent of its obligations hereunder (to the extent Parent exists following such assignment) and the Assignee agrees to assume and be bound by all of the terms of this Agreement. The Parent or an Assignee may not otherwise assign this Agreement without the prior consent of the Representative (such consent not to be unreasonably withheld, conditioned or delayed). Any attempted assignment of this Agreement in violation of this Section 6.5 will be void ab initio and of no effect.
Section 6.6 Benefits of Agreement; Action by Representative. Nothing in this Agreement, express or implied, will give to any Person (other than the Parent, the Rights Agent, the Holders and their respective permitted successors and assigns hereunder) any benefit or any legal or equitable right, remedy or claim under this Agreement or under any covenant or provision herein contained, all such covenants and provisions being for the sole benefit of the Parent, the Rights Agent, the Holders and their permitted successors and assigns. The Holders will have no rights hereunder except as are expressly set forth herein. Except for the rights of the Rights Agent set forth herein, the Representative (at the instruction of the Acting Holders) will have the sole right, on behalf of all Holders, by virtue of or under any provision of this Agreement, to institute any action or proceeding at law or in equity with respect to this Agreement, and no individual Holder or other group of Holders will be entitled to exercise such rights.
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Section 6.7 Governing Law. This Agreement and the CVRs will be governed by, and construed in accordance with, the laws of the state of Delaware without regard to the conflicts of law rules of such state.
Section 6.8 Jurisdiction. In any action or proceeding between any of the parties hereto arising out of or relating to this Agreement or any of the transactions contemplated hereby, each of the parties hereto: (a) irrevocably and unconditionally consents and submits to the exclusive jurisdiction and venue of the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the Superior Court of the State of Delaware or the United States District Court for the District of Delaware ; (b) agrees that all claims in respect of such action or proceeding shall be heard and determined exclusively in accordance with clause (a) of this Section 6.8; (c) waives any objection to laying venue in any such action or proceeding in such courts; (d) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over any Party; and (e) agrees that service of process upon such Party in any such action or proceeding shall be effective if notice is given in accordance with Section 6.1 or Section 6.2 of this Agreement.
Section 6.9 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATION OF THIS WAIVER, (III) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6.9.
Section 6.10 Severability Clause. In the event that any provision of this Agreement, or the application of any such provision to any Person or set of circumstances, is for any reason determined to be invalid, unlawful, void or unenforceable to any extent, the remainder of this Agreement, and the application of such provision to Persons or circumstances other than those as to which it is determined to be invalid, unlawful, void or unenforceable, will not be impaired or otherwise affected and will continue to be valid and enforceable to the fullest extent permitted by applicable Law. Upon such a determination, the parties hereto will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible; provided, however, that if an excluded provision shall affect the rights, immunities, liabilities, duties or obligations of the Rights Agent, the Rights Agent shall be entitled to resign immediately upon written Notice to the Parent and the Representative.
Section 6.11 Counterparts; Effectiveness. This Agreement may be signed in any number of counterparts, each of which will be deemed an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement or any counterpart may be executed and delivered by facsimile copies or delivered by electronic communications by portable document format (.pdf), each of which shall be deemed an original. This Agreement will become effective when each party hereto will have received a counterpart hereof signed by the other party hereto. Until and unless each party has received a counterpart hereof signed by the other party hereto, this Agreement will have no effect and no party will have any right or obligation hereunder (whether by virtue of any oral or written agreement or any other communication).
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Section 6.12 Termination. This Agreement will automatically terminate and be of no further force or effect and, except as provided in Section 3.2, the parties hereto will have no further liability hereunder, and the CVRs will expire without any consideration or compensation therefor, upon the earliest to occur of (the date of such occurrence being the “Termination Date”) (a) the payment of the aggregate amounts required to be paid to Holders under the terms of this Agreement; (b) no payment under the CVRs is required to be paid under the terms of this Agreement prior to the fifteenth (15) anniversary of this Agreement and the issuance of the CVRs; and (c) the delivery of a written notice of termination duly executed by the Parent, the Representative and the Acting Holders to the CVR Agent. The termination of this Agreement will not affect or limit the right of Holders to receive the CVR Proceeds under Section 2.4 to the extent earned and received within the time frames set forth herein and prior to the termination of this Agreement, and the provisions applicable thereto will survive the expiration or termination of this Agreement until such payment of CVR Proceeds have been made, if applicable.
Section 6.13 Funds. All funds received by Rights Agent under this Agreement that are to be distributed or applied by Rights Agent in the performance of services hereunder (the “Funds”) shall be held by the Rights Agent, as agent for the Parent, and deposited in one or more bank accounts to be maintained by the Rights Agent in its name as agent for the Parent. Until paid pursuant to the terms of this Agreement, the Rights Agent shall hold the Funds through such accounts in: deposit accounts of an Approved Bank. The Rights Agent shall, in the absence of bad faith, gross negligence, fraud or willful misconduct (each as determined by a final non-appealable judgment of a court of competent jurisdiction) on its part, have no responsibility or liability for any diminution of the Funds that may result from any deposit made by the Rights Agent in accordance with this paragraph, including any losses resulting from a default by any bank, financial institution or other third party. The Rights Agent may from time to time receive interest, dividends or other earnings in connection with such deposits.
Section 6.14 Further Assurance by Parent. The Parent agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts, documents, instruments and assurances as may reasonably be required or requested by the Rights Agent or the Representative for the carrying out or performing by the Rights Agent or the Representative of the provisions of this Agreement.
Section 6.15 Enforcement. The rights and remedies of the parties shall be cumulative with and not exclusive of any other remedy conferred hereby. The parties hereto agree that irreparable damage would occur and that the parties would not have any adequate remedy at Law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to seek an injunction or injunctions to prevent breaches or threatened breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, in the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the Superior Court of the State of Delaware or the United States District Court for the District of Delaware, without proof of actual damages or otherwise (and each party hereby waives any requirement for the securing or posting of any bond in connection with such remedy), this being in addition to any other remedy to which they are entitled at Law or in equity (including monetary damages). Any actions seeking enforcement of the rights of Holders hereunder may be brought solely by the CVR Agent, acting at the instruction of the Acting Holders.
Section 6.16 Construction.
(a) For purposes of this Agreement, whenever the context requires: singular terms will include the plural, and vice versa; the masculine gender will include the feminine and neuter genders; the feminine gender will include the masculine and neuter genders; and the neuter gender will include the masculine and feminine genders.
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(b) As used in this Agreement, the words “include” and “including,” and variations thereof, will not be deemed to be terms of limitation, but rather will be deemed to be followed by the words “without limitation.”
(c) The headings contained in this Agreement are for convenience of reference only, will not be deemed to be a part of this Agreement and will not be referred to in connection with the construction or interpretation of this Agreement.
(d) Unless stated otherwise, “Article” and “Section” followed by a number or letter mean and refer to the specified Article or Section of this Agreement. The term “Agreement” and any reference in this Agreement to this Agreement or any other agreement or document includes, and is a reference to, this Agreement or such other agreement or document as it may have been, or may from time to time be, amended, restated, replaced, supplemented or novated and includes all schedules to it.
(e) A period of time is to be computed as beginning on the day following the event that began the period and ending at 4:30 p.m. on the last day of the period, if the last day of the period is a Business Day, or at 4:30 p.m. on the next Business Day if the last day of the period is not a Business Day.
(f) Any reference in this Agreement to a date or time shall be deemed to be such date or time in New York City, United States, unless otherwise specified. The parties hereto and the Parent have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any Person by virtue of the authorship of any provision of this Agreement.
(g) All references herein to “$” are to United States Dollars.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed as of the day and year first above written.
| MENTARI THERAPEUTICS, INC. | ||
| By: | /s/ Eric A. Adams | |
| Name: | Eric A. Adams | |
| Title: | President and Chief Executive Officer | |
| ODYSSEY TRANSFER AND TRUST COMPANY | ||
| By: | /s/ Rebecca Paulson | |
| Name: | Rebecca Paulson | |
| Title: | President | |
| INDIGO CVR SERVICES INC. | ||
| By: | /s/ Neil Klompas | |
| Name: | Neil Klompas | |
| Title: | Director | |
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SCHEDULE “A”
NOTICE OF RE-REGISTRATION
| TO: |
Odyssey Transfer and Trust Company (the “Rights Agent”) | |
| FROM: |
[•] | |
| RE: |
Re-registration of CVRs (Beneficial holders) | |
Reference is made to the contingent value rights agreement dated November 6, 2026 between the CVR Agent, Parent and the Representative (the “CVR Agreement”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed thereto in the CVR Agreement.
The undersigned hereby irrevocably directs the Rights Agent to:
| (a) | re-register [NUMBER] Contingent Value Rights, currently registered in the name of [INTERMEDIARY] (the “Subject CVRs”), in the name of [BENEFICIAL HOLDER] (the “Re-Registration”); |
| (b) | update the CVR Register to reflect the Re-Registration; and |
| (c) | take any other action as the Rights Agent reasonably believes is necessary to implement the Re-Registration. |
By executing this direction and certificate, the undersigned hereby certify that:
| (a) | the Subject CVRs are currently registered in the name of [INTERMEDIARY], only as a result of [INTERMEDIARY] acting as an Intermediary for and on behalf of [BENEFICIAL HOLDER]; and |
| (b) | the Re-Registration will not result in a change in the beneficial entitlement to the CVR Payment for the Subject CVRs. |
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DATED this ___ day of ________, 202_.
| [INTERMEDIARY] | ||||||
| Per: |
||||||
| [BENEFICIAL HOLDER] |
Name: | |||||
| Title: | ||||||
Exhibit 10.8
INDEMNIFICATION AGREEMENT
This Indemnification Agreement (this “Agreement”) is entered into on __________, 20__, by and between Mentari Therapeutics, Inc., a Nevada corporation (the “Company”), and __________ (the “Indemnitee”). Notwithstanding the date of execution of this Agreement, each of the parties hereto agrees that their respective rights, duties and obligations pursuant to this Agreement shall come into effect upon the earliest date that the Indemnitee is duly elected or appointed as a director or officer of the Company.
RECITALS
WHEREAS, the Board of Directors of the Company (the “Board”) has determined that the inability to attract and retain qualified persons as directors and officers is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there shall be adequate certainty of protection through insurance and indemnification against risks of claims and actions against them arising out of their service to and activities on behalf of the Company, including their Corporate Status (as defined below);
WHEREAS, the Company has adopted provisions in its Bylaws (as may be amended or restated from time to time, the “Bylaws”) providing for indemnification and advancement of expenses of its directors and officers to the fullest extent authorized by the laws of the State of Nevada, including the Nevada Revised Statutes (as the same exists or may hereafter be amended, the “NRS”), and the Company wishes to clarify and enhance the rights and obligations of the Company and the Indemnitee with respect to indemnification and advancement of expenses; and
WHEREAS, in order to induce and encourage highly experienced and capable persons to serve and continue to serve as directors and officers of the Company and, as the Company may request, in any other capacity giving rise to the Corporate Status of such person, and to otherwise promote the desirable end that such persons shall resist what they consider unjustified lawsuits and claims made against them in connection with the good faith performance of their duties to the Company, with the knowledge that certain costs, judgments, penalties, fines, liabilities and expenses incurred by them in their defense of such litigation are to be borne by the Company and they shall receive appropriate protection against such risks and liabilities, the Board has determined that this Agreement is reasonable and prudent to promote and ensure the best interests of the Company and its stockholders.
AGREEMENT
NOW, THEREFORE, in consideration of the Indemnitee’s service or continued service as a director or officer of the Company, the parties hereto agree as follows:
| 1. | Definitions. For purposes of this Agreement: |
| (a) | A “Change in Control” will be deemed to have occurred if, with respect to any particular 24-month period, the individuals who, at the beginning of such 24-month period, constituted the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board during such period; provided, however, that any individual becoming a director subsequent to the beginning of such 24-month period whose election or appointment, or nomination for election by the stockholders of the Company, was approved |
| or ratified by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office as a director occurs as a result of, or in connection with, an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board. |
| (b) | “Disinterested Director” means a director of the Company who is not or was not a party to the Proceeding in respect of which indemnification is being sought by the Indemnitee. |
| (c) | “Expenses” includes, without limitation, expenses incurred in connection with the defense or settlement of any action, suit, arbitration, alternative dispute resolution mechanism, inquiry, judicial, administrative, or legislative hearing, investigation, or any other threatened, pending, or completed proceeding, whether brought by or in the right of the Company or otherwise, including any and all appeals, whether of a civil, criminal, administrative, legislative, investigative, or other nature, attorneys’ fees, witness fees and expenses, fees and expenses of accountants and other advisors, retainers and disbursements and advances thereon, the premium, security for, and other costs relating to any bond (including cost bonds, appraisal bonds, or their equivalents), and any expenses of establishing a right to indemnification or advancement under this Agreement, but shall not include the amount of judgments, fines, ERISA excise taxes, or penalties actually levied against the Indemnitee, or any amounts paid in settlement by or on behalf of the Indemnitee. |
| (d) | “Independent Counsel” means a law firm or a partner or a member of a law firm that is experienced in matters of Nevada corporate law, which firm or partner or member neither is presently nor in the past five years has been retained to represent (i) the Company or the Indemnitee in any matter material to either such party or (ii) any other party to the Proceeding giving rise to a request for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or the Indemnitee in an action to determine the Indemnitee’s right to indemnification under this Agreement. |
| (e) | “Proceeding” means any action, suit, arbitration, alternative dispute resolution mechanism, inquiry, judicial, administrative, or legislative hearing, investigation, or any other threatened, pending, or completed proceeding, whether brought by or in the right of the Company or otherwise, including any and all appeals, whether of a civil, criminal, administrative, legislative, investigative, or other nature, to which the Indemnitee was or is a party or is threatened to be made a party or is otherwise involved in by reason of the fact that the Indemnitee is or was a director, officer, partner, venturer, manager, employee, agent, administrator, or trustee of the Company or while a director, officer, employee, partner, venturer, manager, agent, administrator, or trustee of the Company is or was serving at the request of the Company as a director, officer, manager, employee, agent, or trustee of another corporation or of a partnership, joint venture, limited liability company, trust, or other enterprise, including service with respect to an employee benefit plan (such status, the Indemnitee’s “Corporate Status”), or by reason of anything done or not done by the Indemnitee in any such capacity, whether or not the Indemnitee is serving in such capacity at the time any expense, liability, or loss is incurred for which indemnification or advancement can be provided under this Agreement. |
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| 2. | Service by the Indemnitee. The Indemnitee shall serve and/or continue to serve as a director or officer of the Company faithfully and to the best of the Indemnitee’s ability so long as the Indemnitee is duly elected or appointed and until such time as the Indemnitee’s successor is elected and qualified as such or the Indemnitee is removed in accordance with applicable law or tenders a resignation in writing. |
| 3. | Indemnification and Advancement of Expenses. The Company shall indemnify and hold harmless the Indemnitee, and shall pay to the Indemnitee in advance of the final disposition of any Proceeding all Expenses incurred by the Indemnitee in defending any such Proceeding, to the fullest extent permitted under the NRS (including, without limitation, NRS 78.751(2) and (3)), all on the terms and conditions set forth in this Agreement. Without diminishing the scope of the rights provided by this Section, the rights of the Indemnitee to indemnification and advancement of Expenses provided hereunder shall include but shall not be limited to those rights hereinafter set forth, except that no indemnification or advancement of Expenses shall be paid to the Indemnitee: |
| (a) | to the extent expressly prohibited by applicable law, the Articles of Incorporation of the Company (as may be amended or restated from time to time, the “Articles of Incorporation” and, together with the Bylaws, the “Governing Documents”) or the Bylaws; |
| (b) | for and to the extent that payment is actually made to the Indemnitee under a valid and collectible insurance policy or under a valid and enforceable indemnity clause, provision of the Governing Documents, or agreement of the Company or any other company or other enterprise (and the Indemnitee shall, and hereby undertakes to, reimburse the Company for any amounts paid by the Company and subsequently so recovered by the Indemnitee); |
| (c) | for an accounting or disgorgement of profits pursuant to Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or similar provisions of federal, state or local statutory law or common law, if the Indemnitee is held liable therefor (including pursuant to any settlement arrangements); |
| (d) | for any reimbursement of the Company by the Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by such Indemnitee from the sale of securities of the Company, as required in each case under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by such Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act), or the Company’s Compensation Recoupment (Clawback) Policy (as amended from time to time), if the Indemnitee is held liable therefor (including pursuant to any settlement arrangements); or |
| (e) | in connection with an action, suit, or proceeding, or part thereof voluntarily initiated by the Indemnitee (including claims and counterclaims, whether such counterclaims are asserted by (i) the Indemnitee, or (ii) the Company in an action, suit, or proceeding initiated by the Indemnitee), except a judicial proceeding pursuant to Section 11 to enforce rights under this Agreement, unless (A) the action, suit, or proceeding, or part thereof, was authorized or ratified by the Board or the Board otherwise determines that indemnification or advancement of Expenses is appropriate or (B) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law. |
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| 4. | Action or Proceedings Other than an Action by or in the Right of the Company. To the fullest extent permitted by applicable law and the Governing Documents, and except as limited by Section 3 above, if the Indemnitee was or is a party or is threatened to be made a party to, or was or is otherwise involved in, any Proceeding (other than an action by or in the right of the Company) by reason of the Indemnitee’s Corporate Status, or by reason of anything done or not done by the Indemnitee in any such capacity, then, to the fullest extent permitted by applicable law and the Governing Documents, the Indemnitee shall be indemnified against all expense, liability, and loss (including judgments, fines, ERISA excise taxes or penalties, amounts paid in settlement by or on behalf of the Indemnitee, and Expenses) actually and reasonably incurred by the Indemnitee, or on behalf of the Indemnitee, in connection with such Proceeding, if the Indemnitee (a) is not liable pursuant to NRS 78.138 or (b) acted in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and with respect to any criminal Proceeding, had no reasonable cause to believe his or her conduct was unlawful. |
| 5. | Indemnity in Proceedings by or in the Right of the Company. To the fullest extent permitted by applicable law and the Governing Documents, and except as limited by Section 3 above, if the Indemnitee was or is a party or is threatened to be made a party to, or was or is otherwise involved in, any Proceeding brought by or in the right of the Company to procure a judgment in its favor by reason of the Indemnitee’s Corporate Status, or by reason of anything done or not done by the Indemnitee in any such capacity, then the Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by the Indemnitee, or on behalf of the Indemnitee, in connection with such Proceeding if the Indemnitee (a) is not liable pursuant to NRS 78.138 or (b) acted in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; provided, however, that no such indemnification shall be made in respect of any claim, issue, or matter as to which the NRS expressly prohibits such indemnification by reason of any adjudication of liability of the Indemnitee to the Company, unless and only to the extent that a court in which such Proceeding was brought or another court of competent jurisdiction shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, the Indemnitee is entitled to indemnification for such expense, liability, and loss as such court shall deem proper. |
| 6. | Indemnification for Costs, Charges, and Expenses of Successful Party. Notwithstanding any limitations of Sections 3(c), 4, and 5 above, to the extent that the Indemnitee has been successful, on the merits or otherwise, in whole or in part, in defense of any Proceeding, or in defense of any claim, issue, or matter therein, including, without limitation, the dismissal of any action without prejudice, or if it is ultimately determined, by final judicial decision of a court of competent jurisdiction from which there is no further right to appeal, that the Indemnitee is otherwise entitled to be indemnified against Expenses, the Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by the Indemnitee in connection therewith. |
| 7. | Partial Indemnification. If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expense, liability, and loss (including judgments, fines, ERISA excise taxes or penalties, amounts paid in settlement by or on behalf of the Indemnitee, and Expenses) actually and reasonably incurred in connection with any Proceeding, or in connection with any judicial proceeding pursuant to Section 11 to enforce rights under this Agreement, but not, however, for all of the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion of such expense, liability, and loss actually and reasonably incurred to which the Indemnitee is entitled. |
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| 8. | Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the maximum extent not expressly prohibited by the NRS and the Governing Documents, the Indemnitee shall be entitled to indemnification against all Expenses actually and reasonably incurred by the Indemnitee or on the Indemnitee’s behalf if the Indemnitee appears as a witness or otherwise incurs legal expenses as a result of or related to the Indemnitee’s Corporate Status, in any threatened, pending, or completed action, suit, arbitration, alternative dispute resolution mechanism, inquiry, judicial, administrative, or legislative hearing, investigation, or any other threatened, pending, or completed proceeding, whether of a civil, criminal, administrative, legislative, investigative, or other nature, to which the Indemnitee neither is, nor is threatened to be made, a party. |
| 9. | Determination of Entitlement to Indemnification. To receive indemnification under this Agreement, the Indemnitee shall submit a written request to the Secretary of the Company. Such request shall include documentation or information that is necessary for such determination and is reasonably available to the Indemnitee. Upon receipt by the Secretary of the Company of a written request by the Indemnitee for indemnification pursuant to this Agreement, the entitlement of the Indemnitee to indemnification, to the extent not provided pursuant to the terms of this Agreement and permitted by the Governing Documents, shall be determined by the following person or persons who shall be empowered to make such determination (as selected by the Board, except with respect to Section 9(e) below): (a) the Board by a majority vote of Disinterested Directors, whether or not such majority constitutes a quorum; (b) a committee consisting only of Disinterested Directors, which committee members are designated by a majority vote of the Disinterested Directors, whether or not such majority constitutes a quorum; (c) if there are no Disinterested Directors, or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to the Indemnitee; (d) the stockholders of the Company; or (e) in the event that a Change in Control has occurred after the date of this Agreement, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to the Indemnitee. Such Independent Counsel shall be selected by the Board and approved by the Indemnitee, except that in the event that a Change in Control has occurred, Independent Counsel shall be selected by the Indemnitee. Upon failure of the Board so to select such Independent Counsel or upon failure of the Indemnitee so to approve (or so to select, in the event a Change in Control has occurred), such Independent Counsel shall be selected upon application to a court of competent jurisdiction. The determination of entitlement to indemnification shall be made and, unless a contrary determination is made, such indemnification shall be paid in full by the Company not later than 60 calendar days after receipt by the Secretary of the Company of the written request for indemnification. If the person making such determination shall determine that the Indemnitee is entitled to indemnification as to part (but not all) of the application for indemnification, such person shall reasonably prorate such partial indemnification among the claims, issues, or matters at issue at the time of the determination. |
| 10. | Presumptions and Effect of Certain Proceedings. The Secretary of the Company shall, promptly upon receipt of the Indemnitee’s written request for indemnification, advise in writing the Board or such other person or persons empowered to make the determination as provided in Section 9 that the Indemnitee has made such request for indemnification. Upon making such request for indemnification, the Indemnitee shall be presumed to be entitled to indemnification hereunder. If the Company wishes to overcome this presumption it must do so by a preponderance of the evidence. If the person or persons so empowered to make such determination shall have failed to make the requested determination with respect to indemnification within 60 calendar days after receipt by the Secretary of the Company of such request, a requisite determination of entitlement to indemnification shall be deemed to have been made and the Indemnitee shall be absolutely entitled to such indemnification, absent actual fraud in the request for indemnification. The termination of any Proceeding described in Sections 4 or 5 by judgment, order, settlement, or conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself (a) create a |
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| presumption that the Indemnitee did not act in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, or with respect to any criminal Proceeding, had reasonable cause to believe his or her conduct was unlawful or (b) otherwise adversely affect the rights of the Indemnitee to indemnification except as may be provided herein. |
| 11. | Remedies of the Indemnitee in Cases of Determination Not to Indemnify or to Advance Expenses; Right to Bring Suit. In the event that a determination is made that the Indemnitee is not entitled to indemnification hereunder or if payment is not timely made following a determination of entitlement to indemnification pursuant to Sections 9 and 10, or if an advancement of Expenses is not timely made pursuant to Section 16, the Indemnitee may at any time thereafter bring suit against the Company seeking an adjudication of entitlement to such indemnification or advancement of Expenses, and any such suit shall be brought in the Eighth Judicial District Court of the State of Nevada in Clark County, Nevada (the “Nevada Court”) unless, if the Indemnitee is an employee of the Company, otherwise required by the law of the state in which the Indemnitee primarily resides and works. The Company shall not oppose the Indemnitee’s right to seek any such adjudication. In 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 the Indemnitee has not met any applicable standard of conduct for indemnification set forth in this Agreement (including the standard described in Section 4 or 5, as applicable) or set forth in NRS 78.751(3)(a). Further, in any suit brought by the Company to recover an advancement of Expenses pursuant to the terms of an undertaking, the Company shall be entitled to recover such Expenses upon a final judicial decision of a court of competent jurisdiction from which there is no further right to appeal that the Indemnitee has not met the standard of conduct described above. Neither the failure of the Company (including the Disinterested Directors, a committee of Disinterested Directors, Independent 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 standard of conduct described above, nor an actual determination by the Company (including the Disinterested Directors, a committee of Disinterested Directors, Independent Counsel, or its stockholders) that the Indemnitee has not met the standard of conduct described above shall create a presumption that the Indemnitee has not met the standard of conduct described above, 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 Company 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 Section 11 or otherwise shall be on the Company. If a determination is made or deemed to have been made pursuant to the terms of Section 9 or 10 that the Indemnitee is entitled to indemnification, the Company shall be bound by such determination and is precluded from asserting that such determination has not been made or that the procedure by which such determination was made is not valid, binding, and enforceable. The Company further agrees to stipulate in any court pursuant to this Section 11 that the Company is bound by all the provisions of this Agreement and is precluded from making any assertions to the contrary. If the court shall determine that the Indemnitee is entitled to any indemnification or advancement of Expenses hereunder, the Company shall pay all Expenses actually and reasonably incurred by the Indemnitee in connection with such adjudication (including, but not limited to, any appellate proceedings) to the fullest extent permitted by law, and in any suit brought by the Company to recover an advancement of Expenses pursuant to the terms of an undertaking, the Company shall pay all Expenses actually and reasonably incurred by the Indemnitee in connection with such suit to the extent the Indemnitee has been successful, on the merits or otherwise, in whole or in part, in defense of such suit, to the fullest extent permitted by law. |
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| 12. | Non-Exclusivity of Rights; Survival of Rights; Insurance; Subrogation. |
| (a) | The rights provided by this Agreement shall not be deemed exclusive of any other rights to which the Indemnitee may at any time be entitled under applicable law, the Governing Documents, any agreement, a vote of stockholders, a resolution of the Board or the Disinterested Directors, or otherwise. No amendment, alteration or repeal of this Agreement or of any provision of this Agreement shall limit or restrict any right of the Indemnitee under this Agreement in respect of any action taken or omitted by the Indemnitee in his or her Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in the NRS, whether by statute or judicial decision, permits greater indemnification than would be afforded under the current Governing Documents and this Agreement, it is the intent of the parties hereto that the Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy. |
| (b) | To the extent that the Company maintains an insurance policy or policies providing liability insurance for directors, officers, employees, or agents or fiduciaries of the Company or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that such person serves at the request of the Company, the Company shall obtain coverage for the Indemnitee under such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any other director (if the Indemnitee is a director) or officer (if the Indemnitee is not a director but is an officer) of the Company under such policy or policies. If, at the time of the receipt of a notice of a claim pursuant to the terms of this Agreement, the Company has director and officer liability insurance in effect, the Company shall give notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all commercially reasonable steps to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies. |
| (c) | In the event of any payment under this Agreement, [subject to the exceptions contained in Section 12(d) below,]1 the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee[ (excluding insurance obtained on the Indemnitee’s own behalf)], and the Indemnitee shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company effectively to bring suit to enforce such rights. |
| (d) | [The Company hereby acknowledges that Indemnitee has certain rights to indemnification, advancement of expenses and/or insurance provided by ____________ and/or [their] affiliates (collectively, the “Designee Indemnitors”). The Company hereby agrees (i) that it is the indemnitor of first resort vis-à-vis the Designee Indemnitors (i.e., its obligations to Indemnitee are primary and any obligation of the Designee Indemnitors to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Indemnitee are secondary), (ii) that it shall be required to advance the full amount of |
| 1 | Note to Draft: This clause will only apply to directors who are separately indemnified by an entity in connection with their appointment to the Board. |
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| Expenses incurred by Indemnitee and shall be liable for the full amount of all indemnity amounts to the extent required by the terms of this Agreement and the Governing Documents, without regard to any rights Indemnitee may have against the Designee Indemnitors, and (iii) notwithstanding any other provision in this Agreement or the Governing Documents, that it irrevocably waives, relinquishes and releases the Designee Indemnitors from any and all claims against the Designee Indemnitors for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further agrees that no advancement or payment by the Designee Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification from the Company shall affect the foregoing and the Designee Indemnitors shall have a right of contribution and/or be subrogated to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Designee Indemnitors are express third-party beneficiaries of this Section 12(d).]2 |
| (e) | The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable hereunder if and to the extent that the Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise. |
| (f) | The Company’s obligation to indemnify or advance Expenses hereunder to the Indemnitee who is or was serving at the request of the Company as a director, officer, manager, employee or agent of any other corporation, partnership, joint venture, limited liability company, trust, employee benefit plan or other enterprise shall be reduced by any amount the Indemnitee has actually received as indemnification or advancement of expenses from such other corporation, partnership, joint venture, limited liability company, trust, employee benefit plan or other enterprise. |
| 13. | Expenses to Enforce Agreement. In the event that the Indemnitee is subject to or intervenes in any action, suit, or proceeding in which the validity or enforceability of this Agreement is at issue or seeks an adjudication to enforce the Indemnitee’s rights under, or to recover damages for breach of, this Agreement, the Indemnitee, if the Indemnitee prevails in whole or in part in such action, suit, or proceeding, shall be entitled to recover from the Company and shall be indemnified by the Company against any Expenses actually and reasonably incurred by the Indemnitee in connection therewith. |
| 14. | Continuation of Indemnity. All agreements and obligations of the Company contained herein shall continue during the period the Indemnitee is a director, officer, manager, employee, agent, or trustee of the Company or while a director, officer, manager, employee, agent, or trustee is serving at the request of the Company as a director, officer, manager, employee, agent, or trustee of another corporation or of a partnership, joint venture, limited liability company, trust, or other enterprise, including service with respect to an employee benefit plan, and shall continue thereafter with respect to any possible claims based on the fact that the Indemnitee was a director, officer, employee, agent, or trustee of the Company or, while a director, officer, manager, employee, agent, or trustee of the Company, was serving at the request of the Company as a director, officer, manager, employee, agent, or trustee of another corporation or of a partnership, joint venture, limited liability company, trust, or other enterprise, including service with respect to an employee benefit plan. This Agreement shall be binding upon all successors and assigns of the Company (including any transferee of all or substantially all of its assets and any successor by merger or operation of law) and shall inure to the benefit of the Indemnitee’s heirs, executors, and administrators. |
| 2 | Note to Draft: This clause will only apply to directors who are separately indemnified by an entity in connection with their appointment to the Board. |
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| 15. | Notification and Defense of Proceeding. Promptly after receipt by the Indemnitee of notice of any Proceeding, the Indemnitee shall, if a request for indemnification or an advancement of Expenses in respect thereof is to be made against the Company under this Agreement, notify the Company in writing of the commencement thereof; but the omission so to notify the Company shall not relieve it from any liability that it may have to the Indemnitee unless, and to the extent that, such failure actually and materially prejudices the interests of the Company. Notwithstanding any other provision of this Agreement or the Governing Documents, with respect to any such Proceeding of which the Indemnitee notifies the Company: |
| (a) | The Company shall be entitled to participate therein at its own expense; |
| (b) | Except as otherwise provided in this Section 15(b), to the extent that it may wish, the Company, jointly with any other indemnifying party similarly notified, shall be entitled to assume the defense thereof, with counsel satisfactory to the Indemnitee. After notice from the Company to the Indemnitee of its election so to assume the defense thereof, the Company shall not be liable to the Indemnitee under this Agreement for any expenses of counsel subsequently incurred by the Indemnitee in connection with the defense thereof except as otherwise provided below. The Indemnitee shall have the right to employ the Indemnitee’s own counsel in such Proceeding, but the fees and expenses of such counsel incurred after notice from the Company of its assumption of the defense thereof shall be at the expense of the Indemnitee unless (i) the employment of counsel by the Indemnitee has been authorized by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and the Indemnitee in the conduct of the defense of such Proceeding, or (iii) within 60 calendar days of receipt of notice from the Indemnitee, the Company shall not have employed counsel to assume the defense of the Proceeding, in each of which cases the fees and expenses of the Indemnitee’s counsel shall be at the expense of the Company. The Company shall not be entitled to assume the defense of any Proceeding brought by or on behalf of the Company or as to which the Indemnitee shall have made the conclusion provided for in (ii) above; and |
| (c) | Notwithstanding any other provision of this Agreement, the Company shall not be liable to indemnify the Indemnitee under this Agreement for any amounts paid in settlement of any Proceeding effected without the Company’s written consent, or for any judicial or other award, if the Company was not given an opportunity, in accordance with this Section 15, to participate in the defense of such Proceeding. The Company shall not settle any Proceeding in any manner that would impose any penalty or limitation on or disclosure obligation with respect to the Indemnitee, or that would directly or indirectly constitute or impose any admission or acknowledgment of fault or culpability with respect to the Indemnitee, without the Indemnitee’s written consent. Neither the Company nor the Indemnitee shall unreasonably withhold its consent to any proposed settlement. |
| 16. | Advancement of Expenses. All Expenses incurred by the Indemnitee in defending any Proceeding described in Sections 4 or 5 shall be paid by the Company in advance of the final disposition of such Proceeding at the request of the Indemnitee. Notwithstanding the foregoing, the Company shall not advance or continue to advance Expenses to the Indemnitee if a determination is reasonably made that the facts known at the time such determination is made demonstrate, by clear and convincing evidence, that the Indemnitee acted in bad faith or in a manner that the Indemnitee did not reasonably believe to be in or not opposed to the best interests of the Company, or, with |
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| respect to any criminal Proceeding, that the Indemnitee had reasonable cause to believe his or her conduct was unlawful. Such determination shall be made: (i) by the Board by a majority vote of Disinterested Directors, whether or not such majority constitutes a quorum; (ii) by a committee consisting only of Disinterested Directors, which committee members are designated by a majority vote of the Disinterested Directors, whether or not such majority constitutes a quorum; or (iii) if there are no Disinterested Directors, or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to the Indemnitee. To receive an advancement of Expenses under this Agreement, the Indemnitee shall submit a written request to the Secretary of the Company. Such request shall reasonably evidence the Expenses incurred by the Indemnitee and shall include or be accompanied by an undertaking, by or on behalf of the Indemnitee, to repay all amounts so advanced if it shall ultimately be determined, by final judicial decision of a court of competent jurisdiction from which there is no further right to appeal, that the Indemnitee is not entitled to be indemnified for such Expenses by the Company as provided by this Agreement or otherwise. The Indemnitee’s undertaking to repay any such amounts is not required to be secured, and the Company may not condition advancement of Expenses hereunder on the provision of any security for such undertaking. Each such advancement of Expenses shall be made within 20 calendar days after the receipt by the Secretary of the Company of such written request. The Indemnitee’s entitlement to Expenses under this Agreement shall include those incurred in connection with any action, suit, or proceeding by the Indemnitee seeking an adjudication pursuant to Section 11 of this Agreement (including the enforcement of this provision) to the extent the court shall determine that the Indemnitee is entitled to an advancement of Expenses hereunder. |
| 17. | Severability; Prior Indemnification Agreements. If any provision or provisions of this Agreement 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 (a) the validity, legality, and enforceability of such provision in any other circumstance and of the remaining provisions of this Agreement (including, without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal, or unenforceable, that are not by themselves invalid, illegal, or unenforceable) and the application of such provision to other persons or entities or circumstances shall not in any way be affected or impaired thereby, and (b) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraph of this Agreement containing any such provision held to be invalid, illegal, or unenforceable, that are not themselves invalid, illegal, or unenforceable) shall be construed so as to give effect to the intent of the parties that the Company provide protection to the Indemnitee to the fullest enforceable extent set forth in this Agreement. This Agreement shall supersede and replace any prior indemnification agreements entered into by and between the Company and the Indemnitee and any such prior agreements shall be terminated upon execution of this Agreement. |
| 18. | Headings; References; Pronouns. The headings of the sections of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof. References herein to section numbers are to sections of this Agreement. All pronouns and any variations thereof shall be deemed to refer to the singular or plural as appropriate. |
| 19. | Other Provisions. |
| (a) | This Agreement and all disputes or controversies arising out of or related to this Agreement shall be governed by, and construed in accordance with, the internal laws of the State of Nevada, without regard to the laws of any other jurisdiction that might be applied because of conflicts of laws principles of the State of Nevada, unless, if the Indemnitee is an |
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| employee of the Company, otherwise required by the law of the state in which the Indemnitee primarily resides and works. The Company and the Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Nevada Court, and not in any other court in any other country, (ii) generally and unconditionally consent to submit to the exclusive jurisdiction of the Nevada Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) appoint, to the extent such party is not otherwise subject to service of process in the State of Nevada, irrevocably the Company’s registered agent in the State of Nevada, as such party’s agent in the State of Nevada for acceptance of legal process in connection with any such action or proceeding against such party with the same legal force and validity as if served upon such party personally within the State of Nevada, (iv) waive any objection to the laying of venue of any such action or proceeding in the Nevada Court, and (v) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Nevada Court has been brought in an improper or inconvenient forum. The foregoing consent to the exclusive jurisdiction of the Nevada Court shall not constitute general consent to service of process for any purpose except as provided above, and shall not be deemed to confer rights on any person other than the parties to this Agreement. |
| (b) | This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same instrument and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party. |
| (c) | This Agreement shall not be deemed an employment contract between the Company and any Indemnitee who is an officer of the Company, and, if the Indemnitee is an officer of the Company, the Indemnitee specifically acknowledges that the Indemnitee may be discharged at any time for any reason, with or without cause, and with or without severance compensation, except as may be otherwise provided in a separate written contract between the Indemnitee and the Company. |
| (d) | This Agreement may not be amended, modified, or supplemented in any manner, whether by course of conduct or otherwise, except by an instrument in writing specifically designated as an amendment hereto, signed by or on behalf of each party. No failure or delay of either party in exercising any right or remedy hereunder shall operate as a waiver thereof, and no single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, shall preclude any other or further exercise thereof or the exercise of any other right or power. |
| (e) | All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (1) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (2) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (3) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (4) sent by facsimile transmission, with receipt of oral confirmation that such transmission has been received: |
| (i) | If to the Indemnitee, at such an address as the Indemnitee shall provide to the Company. |
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| (ii) | If to the Company, to: |
Mentari Therapeutics, Inc.
221 Crescent Street, Building 23, Suite 105
Waltham, MA 02453
Attention: General Counsel
Email: legal@mentaritx.com
or to any other address as may have been furnished to the Indemnitee by the Company.
| (f) | To the fullest extent permitted by applicable law, if the indemnification provided for in this Agreement is unavailable to the Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying the Indemnitee, shall contribute to the amount incurred by the Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any Proceeding in such proportion as is deemed fair and reasonable in light of all of the circumstances in order to reflect (1) the relative benefits received by the Company and the Indemnitee in connection with the event(s) and/or transaction(s) giving rise to such Proceeding; and/or (2) the relative fault of the Company (and its directors, officers, employees and agents) and the Indemnitee in connection with such event(s) and/or transactions. |
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the Company and the Indemnitee have executed this Agreement or caused this Agreement to be executed as of the date first written above.
| MENTARI THERAPEUTICS, INC. | ||
| By: |
| |
| Name: | ||
| Title: | ||
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| ||
| Indemnitee: | ||
[SIGNATURE PAGE TO INDEMNIFICATION AGREEMENT]
Exhibit 10.13
MENTARI THERAPEUTICS, INC.
2026 STOCK INCENTIVE PLAN
| 1. | Purpose |
The purpose of this Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (the “Plan”) is to promote and closely align the interests of employees, officers, non-employee directors and other individual service providers of Mentari Therapeutics, Inc. and its stockholders by providing stock-based compensation and other performance-based compensation. The objectives of the Plan are to attract and retain the best available employees, officers, non-employee directors and other individual service providers for positions of substantial responsibility and to motivate Participants to optimize the profitability and growth of the Company through incentives that are consistent with the Company’s goals and that link the personal interests of Participants to those of the Company’s stockholders. The Plan provides for the grant of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units and Other Stock-Based Awards and for Incentive Bonuses, which may be paid in cash, Common Stock or a combination thereof, as determined by the Committee.
| 2. | Definitions |
As used in the Plan, the following terms shall have the meanings set forth below:
(a) “Act” means the Securities Exchange Act of 1934, as amended.
(b) “Affiliate” means any entity in which the Company has a substantial direct or indirect equity interest, as determined by the Committee from time to time.
(c) “Award” means an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Other Stock-Based Award or Incentive Bonus, or any combination of these, granted to a Participant pursuant to the provisions of the Plan, any of which may be subject to performance conditions.
(d) “Award Agreement” means a written or electronic agreement or other instrument as may be approved from time to time by the Committee and designated as such implementing the grant of each Award. An Award Agreement may be in the form of an agreement to be executed by both the Participant and the Company (or an authorized representative of the Company) or certificates, notices or similar instruments as approved by the Committee and designated as such.
(e) “Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Act.
(f) “Board” means the Board of Directors of the Company.
(g) “Cause” has the meaning set forth in the written employment, offer, services or severance agreement or letter between the Participant and the Company or an Affiliate, or in any severance plan in which the Participant participates, or if there is no such agreement or plan or no such term is defined in such agreement or plan, means a Participant’s (i) dishonest statements or acts with respect to the Company or any Affiliate, or any current or prospective customers,
suppliers, vendors or other third parties with which such entity does business that results in or is reasonably anticipated to result in material harm to the Company; (ii) conviction or plea of guilty or no contest to: (A) a felony or (B) any misdemeanor involving moral turpitude, deceit, dishonesty or fraud; (iii) failure to perform in all material respects the Participant’s assigned duties and responsibilities; (iv) gross negligence or willful misconduct that results in or is reasonably anticipated to result in material harm to the Company; (v) violation of any material provision of any agreement(s) between the Participant and the Company, including any agreements related to restrictive covenants; or (vi) material violation of any written Company policies.
(h) “Change in Control” means, except as otherwise provided in an Award Agreement, the occurrence of any one of the following events following the Effective Date (and for the avoidance of doubt shall exclude the transactions contemplated by the Merger Agreement):
(i) any Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including the securities beneficially owned by such Person or any securities acquired directly from the Company or its Affiliates) representing 50% or more of the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in Section 2(h)(iii)(A) below;
(ii) the following individuals cease for any reason to constitute a majority of the number of directors then serving: (A) individuals who, on the Effective Date (as defined below), constitute the Board and (B) any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest, including a consent solicitation, relating to the election of directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s stockholders was approved or recommended by a vote of at least a majority of the directors then still in office who were either directors on the Effective Date or whose appointment, election or nomination for election was previously so approved or recommended;
(iii) there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other entity, other than (A) a merger or consolidation which would result in the holders of the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation;
(iv) the implementation of a plan of complete liquidation or dissolution of the Company; or
(v) there is consummated a sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which is owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.
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(i) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rulings and regulations issued thereunder.
(j) “Committee” means the Compensation Committee of the Board (or any successor committee) or such other committee as designated by the Board to administer the Plan under Section 6.
(k) “Common Stock” means the common stock of the Company, $0.0001 par value per share, or such other class or kind of shares or other securities as may be applicable under Section 16.
(l) “Company” means Mentari Therapeutics, Inc., a Nevada corporation, and except as utilized in the definition of Change in Control, any successor corporation.
(m) “Disability” has the meaning set forth in a written employment, offer, services or severance agreement or letter between the Participant and the Company or an Affiliate, or in any severance plan in which the Participant participates, or if there is no such agreement or plan or no such term is defined in such agreement or plan, means the inability of the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment. A determination of Disability shall be made by the Committee on the basis of such medical evidence as the Committee deems warranted under the circumstances, and in this respect, Participants shall submit to an examination by a physician upon request by the Committee.
(n) “Dividend Equivalent” means an amount payable in cash or Common Stock, as determined by the Committee, equal to the dividends that would have been paid to the Participant if the share of Common Stock with respect to which the Dividend Equivalent relates had been owned by the Participant.
(o) “Effective Date” means the date on which the Plan takes effect, as defined pursuant to Section 4.
(p) “Eligible Person” means any current or prospective employee, officer, non-employee director or other individual service provider of the Company or any Subsidiary; provided, however, that Incentive Stock Options may only be granted to employees of the Company or any of its “subsidiary corporations” within the meaning of Section 424 of the Code.
(q) “Fair Market Value” means as of any date, the value of the Common Stock determined as follows: (i) if the Common Stock is listed on any established stock exchange, system or market, its Fair Market Value shall be the closing price of a share of Common Stock as quoted on such exchange, system or market as reported in the Wall Street Journal or such other source as the Committee deems reliable (or, if no sale of Common Stock is reported for such date, on the next preceding date on which any sale shall have been reported); and (ii) in the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Committee by the reasonable application of a reasonable valuation method, taking into account factors consistent with Treas. Reg. § 1.409A-1(b)(5)(iv)(B) as the Committee deems appropriate.
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(r) “Incentive Bonus” means a bonus opportunity awarded under Section 12 pursuant to which a Participant may become entitled to receive an amount based on satisfaction of such performance criteria established for a specified performance period as specified in the Award Agreement.
(s) “Incentive Stock Option” means an Option that is intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Code.
(t) “Merger Agreement” means that certain Agreement and Plan of Merger and Reorganization dated as of May 19, 2026 by and among the Company, Indigo Merger Sub Corp., Indigo Merger Sub II, LLC and Mentari Therapeutics, Inc.
(u) “Nonqualified Stock Option” means an Option that is not intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Code.
(v) “Option” means a right to purchase a number of shares of Common Stock at such exercise price, at such times and on such other terms and conditions as are specified in or determined pursuant to an Award Agreement. Options granted pursuant to the Plan may be Incentive Stock Options or Nonqualified Stock Options.
(w) “Other Stock-Based Award” means an Award granted to an Eligible Person under Section 11.
(x) “Outstanding Common Stock” means the sum of (i) the shares of Common Stock outstanding, (ii) the shares of Common Stock underlying unexercised pre-funded warrants, and (iii) the shares of Common Stock underlying the Company’s preferred stock, $0.0001 par value (determined on an as-converted basis without regard to any limitations on such conversion).
(y) “Participant” means any Eligible Person to whom Awards have been granted from time to time by the Committee and any authorized transferee of such individual.
(z) “Person” shall have the meaning given in Section 3(a)(9) of the Act, as modified and used in Sections 14(d) and 15(d) thereof, except that such term shall not include (i) the Company or any of its Affiliates, (ii) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Subsidiaries, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities or (iv) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.
(aa) “Restricted Stock” means an Award or issuance of Common Stock the grant, issuance, vesting or transferability of which is subject during specified periods of time to such conditions (including continued employment or engagement or performance conditions) and terms as the Committee deems appropriate.
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(bb) “Restricted Stock Unit” means an Award denominated in units of Common Stock under which the issuance of shares of such Common Stock (or cash payment in lieu thereof) is subject to such conditions (including continued employment or engagement or performance conditions) and terms as the Committee deems appropriate.
(cc) “Separation from Service” or “Separates from Service” means a Termination of Service that constitutes a “separation from service” within the meaning of Section 409A of the Code.
(dd) “Stock Appreciation Right” or “SAR” means a right granted that entitles the Participant to receive, in cash or Common Stock or a combination thereof, as determined by the Committee, value equal to the excess of (i) the Fair Market Value of a specified number of shares of Common Stock at the time of exercise over (ii) the exercise price of the right, as established by the Committee on the date of grant.
(ee) “Subsidiary” means any business association (including a corporation or a partnership, other than the Company) in an unbroken chain of such associations beginning with the Company if each of the associations other than the last association in the unbroken chain owns equity interests (including stock or partnership interests) possessing 50% or more of the total combined voting power of all classes of equity interests in one of the other associations in such chain.
(ff) “Substitute Awards” means Awards granted or Common Stock issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, by a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines.
(gg) “Termination of Service” means ceasing to serve as an employee of the Company and its Subsidiaries or, with respect to a non-employee director or other service provider, ceasing to serve as such for the Company and its Subsidiaries, except that with respect to all or any Awards held by a Participant (i) the Committee may determine that a leave of absence (including as a result of a Participant’s short-term or long-term disability or other medical leave) or employment on a less than full-time basis is considered a “Termination of Service,” (ii) the Committee may determine that a transition from employment to service with a partnership, joint venture or corporation not meeting the requirements of a Subsidiary in which the Company or a Subsidiary is a party is not considered a “Termination of Service,” (iii) service as a member of the Board shall constitute continued service with respect to Awards granted to a Participant while he or she served as an employee, (iv) service as an employee of the Company or a Subsidiary shall constitute continued employment with respect to Awards granted to a Participant while he or she served as a member of the Board or other service provider, and (v) the Committee may determine that a transition from employment with the Company or a Subsidiary to service to the Company or a Subsidiary other than as an employee shall constitute a “Termination of Service”. The Committee shall determine whether any corporate transaction, such as a sale or spin-off of a division or Subsidiary that employs or engages a Participant, shall be deemed to result in a Termination of Service with the Company and its Subsidiaries for purposes of any affected Participant’s Awards, and the Committee’s decision shall be final and binding.
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| 3. | Eligibility |
Any Eligible Person is eligible for selection by the Committee to receive an Award.
| 4. | Effective Date and Termination of Plan |
This Plan became effective on the Closing Date (as defined in the Merger Agreement) (the “Effective Date”). The Plan shall remain available for the grant of Awards until September 29, 2036. Notwithstanding the foregoing, the Plan may be terminated at such earlier time as the Board may determine. Termination of the Plan will not affect the rights and obligations of the Participants and the Company arising under Awards theretofore granted.
| 5. | Shares Subject to the Plan and to Awards |
(a) Aggregate Limits. The aggregate number of shares of Common Stock issuable under the Plan shall be equal to (i) 16.5% of the total number of shares of Outstanding Common Stock immediately following the closing of the transactions set forth in the Merger Agreement plus (ii) any shares of Common Stock added as a result of the following sentence (collectively, the “Share Pool”). The Share Pool will automatically increase on January 1 of each year beginning in 2027 and ending with a final increase on January 1, 2036 in an amount equal to 5% of the Outstanding Common Stock on the preceding December 31; provided, however, that the Committee may provide that there will be no January 1 increase in the Share Pool for any such year or that the increase in the Share Pool for any such year will be a smaller number of shares of Common Stock than would otherwise occur pursuant to this sentence. The aggregate number of shares of Common Stock available for grant under this Plan and the number of shares of Common Stock subject to Awards outstanding at the time of any event described in Section 16 shall be subject to adjustment as provided in Section 16. The shares of Common Stock issued under this Plan may be shares that are authorized and unissued or shares that were reacquired by the Company, including shares purchased in the open market or in private transactions.
(b) Issuance of Shares. For purposes of Section 5(a), the aggregate number of shares of Common Stock issued under this Plan at any time shall equal only the number of shares of Common Stock actually issued upon exercise or settlement of an Award. Shares of Common Stock subject to Awards that have been canceled, expired, forfeited or otherwise not issued under an Award and shares of Common Stock subject to Awards settled in cash shall not count as shares of Common Stock issued under this Plan. The aggregate number of shares available for issuance under this Plan at any time shall not be reduced by (i) shares subject to Awards that have been terminated, expired unexercised, forfeited or settled in cash, (ii) shares subject to Awards that have been retained or withheld by the Company in payment or satisfaction of the exercise price, purchase price or tax withholding obligation of an Award, or (iii) shares subject to Awards that otherwise do not result in the issuance of shares in connection with payment or settlement thereof. In addition, shares that have been delivered (either actually or by attestation) to the Company in payment or satisfaction of the exercise price, purchase price or tax withholding obligation of an Award shall be available for issuance under this Plan.
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(c) Substitute Awards. Substitute Awards shall not reduce the shares of Common Stock authorized for issuance under the Plan or authorized for grant to a Participant in any calendar year. Additionally, in the event that a company acquired by the Company or any Subsidiary, or with which the Company or any Subsidiary combines, has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the shares of Common Stock authorized for issuance under the Plan; provided, however, that Awards using such available shares (i) shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, (ii) shall only be made to individuals who were not employees or service providers of the Company or its Affiliates at the time of such acquisition or combination, and (iii) shall comply with the requirements of any stock exchange or market or quotation system on which the Common Stock is traded, listed or quoted.
(d) Tax Code Limits. The aggregate number of shares of Common Stock that may be issued pursuant to the exercise of Incentive Stock Options granted under this Plan shall be equal to 50,000,000, which number shall be calculated and adjusted pursuant to Section 16 only to the extent that such calculation or adjustment will not affect the status of any Option intended to qualify as an Incentive Stock Option under Section 422 of the Code.
(e) Limits on Non-Employee Director Compensation. The aggregate dollar value of equity-based (based on the grant date Fair Market Value of equity-based Awards) and cash compensation granted under this Plan or otherwise to any non-employee director for service on the Board shall not exceed $750,000 during any full calendar year following the Effective Date of this Plan; provided, however, that in the calendar year in which a non-employee director first joins the Board or during any calendar year in which a non-employee director is designated as Chairman of the Board or Lead Director, the maximum aggregate dollar value of equity-based and cash compensation granted to the non-employee director may be up to $1,000,000.
| 6. | Administration of the Plan |
(a) Administrator of the Plan. The Plan shall be administered by the Committee. The Board shall fill vacancies on, and from time to time may remove or add members to, the Committee. The Committee shall act pursuant to a majority vote or unanimous written consent. Any power of the Committee may also be exercised by the Board, except to the extent that the grant or exercise of such authority would cause any Award or transaction to become subject to (or lose an exemption under) the short-swing profit recovery provisions of Section 16 of the Act. To the extent that any permitted action taken by the Board conflicts with action taken by the Committee, the Board action shall control. To the maximum extent permissible under applicable law, the Committee (or any successor) may by resolution delegate any or all of its authority to one or more subcommittees composed of one or more directors or employees of the Company, and any such subcommittee shall be treated as the Committee for all purposes under this Plan. Notwithstanding the foregoing, if the Board or the Committee (or any successor) delegates to a subcommittee comprised of one or more officers of the Company the authority to grant Awards, no such subcommittee shall designate any officer serving thereon or any officer (within the meaning of Section 16 of the Act) or non-employee director of the Company as a recipient of any
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Awards granted under such delegated authority. The Committee hereby delegates to and designates the most senior officer in the Finance Department of the Company (or such other officer with similar authority), and to his or her delegates or designees, the authority to assist the Committee in the day-to-day administration of the Plan and of Awards granted under the Plan, including those powers set forth in Section 6(b)(v) through (xi) and to execute Award Agreements or other documents entered into under this Plan on behalf of the Committee or the Company. The Committee may further designate and delegate to one or more additional officers or employees of the Company or any Subsidiary, or one or more agents, authority to assist the Committee in any or all aspects of the day-to-day administration of the Plan or of Awards granted under the Plan.
(b) Powers of Committee. Subject to the express provisions of this Plan, the Committee shall be authorized and empowered to do all things that it determines to be necessary or appropriate in connection with the administration of this Plan, including:
(i) to prescribe, amend and rescind rules and regulations relating to this Plan and to define terms not otherwise defined herein;
(ii) to determine which persons are Eligible Persons, to which of such Eligible Persons, if any, Awards shall be granted hereunder and the timing of any such Awards;
(iii) to prescribe and amend the terms of the Award Agreements, to grant Awards and determine the terms and conditions thereof;
(iv) to reduce the exercise price of a previously awarded Option or Stock Appreciation Right or cancel and re-grant or exchange such Option or Stock Appreciation Right for cash or a new Award with a lower (or no) exercise price, with any such determination made by the Committee in its sole discretion, in each case, without stockholder approval;
(v) to adopt such procedures and sub-plans as are necessary or appropriate (A) to permit or facilitate participation in this Plan by Eligible Persons who are not citizens of, or subject to taxation by, the United States or who are employed outside the United States or (B) to allow Awards to qualify for special tax treatment in a jurisdiction other than the United States; provided, however, that Board approval will not be necessary for immaterial modifications to this Plan or any Award Agreement that are required for compliance with the laws of the relevant jurisdiction;
(vi) to establish and verify the extent of satisfaction of any performance goals or other conditions applicable to the grant, issuance, retention, vesting, exercisability or settlement of any Award;
(vii) to prescribe and amend the terms of or form of any document or notice required to be delivered to the Company by Participants under this Plan;
(viii) to determine the extent to which adjustments are required pursuant to Section 16;
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(ix) to interpret and construe this Plan, any rules and regulations under this Plan and the terms and conditions of any Award granted hereunder, and to make exceptions to any such provisions if the Committee, in good faith, determines that it is appropriate to do so;
(x) to approve corrections in the documentation or administration of any Award; and
(xi) to make all other determinations deemed necessary or advisable for the administration of this Plan.
Notwithstanding anything in this Plan to the contrary, with respect to any Award that is “deferred compensation” under Section 409A of the Code, the Committee shall exercise its discretion in a manner that causes such Awards to be compliant with or exempt from the requirements of Section 409A of the Code. Without limiting the foregoing, unless expressly agreed to in writing by the Participant holding such Award, the Committee shall not take any action with respect to any Award which constitutes (x) a modification of a stock right within the meaning of Treas. Reg. § 1.409A-1(b)(5)(v)(B) so as to constitute the grant of a new stock right, (y) an extension of a stock right, including the addition of a feature for the deferral of compensation within the meaning of Treas. Reg. § 1.409A-1 (b)(5)(v)(C), or (z) an impermissible acceleration of a payment date or a subsequent deferral of a stock right subject to Section 409A of the Code within the meaning of Treas. Reg. § 1.409A-1(b)(5)(v)(E).
The Committee may, in its sole and absolute discretion, without amendment to the Plan but subject to the limitations otherwise set forth in Section 20, waive or amend the operation of Plan provisions respecting exercise after Termination of Service. The Committee or any member thereof may, in its sole and absolute discretion, except as otherwise provided in Section 20, waive, settle or adjust any of the terms of any Award so as to avoid unanticipated consequences or address unanticipated events (including any temporary closure of an applicable stock exchange, disruption of communications or natural catastrophe).
(c) Determinations by the Committee. All decisions, determinations and interpretations by the Committee regarding the Plan, any rules and regulations under the Plan, and the terms and conditions of, or operation of, any Award granted hereunder, shall be final and binding on all Participants, beneficiaries, heirs, assigns or other persons holding or claiming rights under the Plan or any Award. The Committee shall consider such factors as it deems relevant, in its sole and absolute discretion, to making such decisions, determinations and interpretations, including the recommendations or advice of any officer or other employee of the Company and such attorneys, consultants and accountants as it may select. Members of the Board and members of the Committee acting under the Plan shall be fully protected in relying in good faith upon the advice of counsel and shall incur no liability except as a result of gross negligence or willful misconduct in the performance of their duties.
(d) Subsidiary Awards. In the case of a grant of an Award to any Participant employed by a Subsidiary, such grant may, if the Committee so directs, be implemented by the Company issuing any subject shares of Common Stock to the Subsidiary, for such lawful consideration as the Committee may determine, upon the condition or understanding that the Subsidiary will transfer the shares of Common Stock to the Participant in accordance with the terms of the Award specified by the Committee pursuant to the provisions of the Plan. Notwithstanding any other provision hereof, such Award may be issued by and in the name of the Subsidiary and shall be deemed granted on such date as the Committee shall determine.
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| 7. | Plan Awards |
(a) Terms Set Forth in Award Agreement. Awards may be granted to Eligible Persons as determined by the Committee at any time and from time to time prior to the termination of the Plan. The terms and conditions of each Award shall be set forth in an Award Agreement in a form approved by the Committee for such Award, subject to and incorporating by reference or otherwise the applicable terms and conditions of the Plan, which Award Agreement may contain such terms and conditions as specified from time to time by the Committee, provided such other terms and conditions do not conflict with the Plan. The Award Agreement for any Award (other than Restricted Stock) shall include the time or times at or within which and the consideration, if any, for which any shares of Common Stock or cash, as applicable, may be acquired from the Company. The terms of Awards may vary among Participants, and the Plan does not impose upon the Committee any requirement to make Awards subject to uniform terms. Accordingly, the terms of individual Award Agreements may vary.
(b) Termination of Service. Subject to the express provisions of the Plan, the Committee shall specify before, at, or after the time of grant of an Award the provisions governing the effect(s) upon an Award of a Participant’s Termination of Service.
(c) Rights of a Stockholder. A Participant shall have no rights as a stockholder with respect to shares of Common Stock covered by an Award (including voting rights) until the date the Participant becomes the holder of record of such shares of Common Stock. No adjustment shall be made for dividends or other rights for which the record date is prior to such date, except as provided in Sections 10(b), 11(b) or 16 of this Plan or as otherwise provided by the Committee.
(d) No Fractional Shares. No fractional shares of Common Stock shall be issued pursuant to an Award or in settlement thereof.
| 8. | Options |
(a) Grant, Term and Price. The grant, issuance, retention, vesting or settlement of any Option shall occur at such time and be subject to such terms and conditions as determined by the Committee or under criteria established by the Committee, which may include conditions based on continued employment or engagement, passage of time, attainment of age or service requirements, or satisfaction of performance conditions. The term of an Option shall in no event be greater than 10 years; provided, however, the term of an Option (other than an Incentive Stock Option) shall be automatically extended if, at the time of its scheduled expiration, the Participant holding such Option is prohibited by law or the Company’s insider trading policy from exercising the Option, which extension shall expire on the 30th day following the date such prohibition no longer applies. The Committee will establish the price at which Common Stock may be purchased upon exercise of an Option, which in no event will be less than the Fair Market Value of such shares on the date of grant; provided, however, that the exercise price per share of Common Stock
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with respect to an Option that is granted as a Substitute Award may be less than the Fair Market Value of the shares of Common Stock on the date such Option is granted if such exercise price is based on a formula set forth in the terms of the options held by such optionees or in the terms of the agreement providing for such merger or other acquisition that satisfies the requirements of (i) Section 409A of the Code, if such options held by such optionees are not intended to qualify as “incentive stock options” within the meaning of Section 422 of the Code, and (ii) Section 424(a) of the Code, if such options held by such optionees are intended to qualify as “incentive stock options” within the meaning of Section 422 of the Code. The exercise price of any Option may be paid in cash to the Company or such other method as determined by the Committee, including an irrevocable commitment by a broker to pay over such amount from a sale of the shares of Common Stock issuable under an Option, the delivery of previously owned shares of Common Stock or withholding of shares of Common Stock otherwise deliverable upon exercise.
(b) No Reload Grants. Options shall not be granted under the Plan in consideration for, and shall not be conditioned upon the delivery of, shares of Common Stock to the Company in payment of the exercise price or tax withholding obligation under any other employee stock option.
(c) Incentive Stock Options. Notwithstanding anything to the contrary in this Section 8, in the case of the grant of an Incentive Stock Option, if the Participant owns stock possessing more than 10% of the combined voting power of all classes of stock of the Company, the exercise price of such Option must be at least 110% of the Fair Market Value of the shares of Common Stock on the date of grant and the Option must expire within a period of not more than five years from the date of grant. Notwithstanding anything in this Section 8 to the contrary, Options designated as Incentive Stock Options shall not be eligible for treatment under the Code as Incentive Stock Options (and will be deemed to be Nonqualified Stock Options) to the extent that either (i) the aggregate Fair Market Value of shares of Common Stock (determined as of the time of grant) with respect to which such Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Subsidiary) exceeds $100,000, taking Options into account in the order in which they were granted, or (ii) such Options otherwise remain exercisable but are not exercised within three months (or such other period of time provided in Section 422 of the Code) of separation of service (as determined in accordance with Section 3401(c) of the Code and the regulations promulgated thereunder).
(d) No Stockholder Rights. Participants shall have no voting rights and will have no rights to receive dividends or Dividend Equivalents in respect of an Option or any shares of Common Stock subject to an Option until the Participant has become the holder of record of such shares.
| 9. | Stock Appreciation Rights |
(a) General Terms. The grant, issuance, retention, vesting or settlement of any Stock Appreciation Right shall occur at such time and be subject to such terms and conditions as determined by the Committee or under criteria established by the Committee, which may include conditions based on continued employment or engagement, passage of time, attainment of age or service requirements, or satisfaction of performance conditions. The term of a Stock Appreciation Right shall in no event be greater than 10 years; provided, however, the term of a Stock Appreciation Right shall be automatically extended if, at the time of its scheduled expiration, the
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Participant holding such Stock Appreciation Right is prohibited by law or the Company’s insider trading policy from exercising the Stock Appreciation Right which extension shall expire on the 30th day following the date such prohibition no longer applies. Stock Appreciation Rights may be granted to Participants from time to time either in tandem with or as a component of Options granted under the Plan (“tandem SARs”) or not in conjunction with other Awards (“freestanding SARs”). Upon exercise of a tandem SAR as to some or all of the shares covered by the grant, the related Option shall be canceled automatically to the extent of the number of shares covered by such exercise. Conversely, if the related Option is exercised as to some or all of the shares covered by the grant, the related tandem SAR, if any, shall be canceled automatically to the extent of the number of shares covered by the Option exercise. Any Stock Appreciation Right granted in tandem with an Option may be granted at the same time such Option is granted or at any time thereafter before exercise or expiration of such Option, provided that the Fair Market Value of Common Stock on the date of the SAR’s grant is not greater than the exercise price of the related Option. All freestanding SARs shall be granted subject to the same terms and conditions applicable to Options as set forth in Section 8 and all tandem SARs shall have the same exercise price as the Option to which they relate. Subject to the provisions of Section 8 and the immediately preceding sentence, the Committee may impose such other conditions or restrictions on any Stock Appreciation Right as it shall deem appropriate. Stock Appreciation Rights may be settled in Common Stock, cash, Restricted Stock or a combination thereof, as determined by the Committee and set forth in the applicable Award Agreement.
(b) No Stockholder Rights. Participants shall have no voting rights and will have no rights to receive dividends or Dividend Equivalents in respect of an Award of Stock Appreciation Rights or any shares of Common Stock subject to an Award of Stock Appreciation Rights until the Participant has become the holder of record of such shares.
| 10. | Restricted Stock and Restricted Stock Units |
(a) Vesting and Performance Criteria. The grant, issuance, vesting or settlement of any Award of Restricted Stock or Restricted Stock Units shall occur at such time and be subject to such terms and conditions as determined by the Committee or under criteria established by the Committee, which may include conditions based on continued employment or engagement, passage of time, attainment of age or service requirements, or satisfaction of performance conditions. In addition, the Committee shall have the right to grant Restricted Stock or Restricted Stock Unit Awards as the form of payment for grants or rights earned or due under other stockholder-approved compensation plans or arrangements of the Company.
(b) Dividends and Distributions. Participants in whose name Restricted Stock is granted shall be entitled to receive all dividends and other distributions paid with respect to those shares of Common Stock, unless determined otherwise by the Committee. The Committee will determine whether any such dividends or distributions will be automatically reinvested in additional shares of Restricted Stock or subject to the same restrictions on transferability as the Restricted Stock with respect to which they were distributed or whether such dividends or distributions will be paid in cash. Shares underlying Restricted Stock Units shall be entitled to dividends or distributions only to the extent provided by the Committee.
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| 11. | Other Stock-Based Awards |
(a) General Terms. The Committee is authorized, subject to limitations under applicable law, to grant to Eligible Persons such other Awards that may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on, or related to, Common Stock, as deemed by the Committee to be consistent with the purposes of the Plan. The Committee shall determine the terms and conditions of such Other Stock-Based Awards. Common Stock delivered pursuant to an Other Stock-Based Award in the nature of a purchase right granted under this Section 11 shall be purchased for such consideration, paid for at such times, by such methods, and in such forms, including cash, Common Stock, other Awards, or other property, as the Committee shall determine.
(b) Dividends and Distributions. Shares underlying Other Stock-Based Awards shall be entitled to dividends or distributions only to the extent provided by the Committee.
| 12. | Incentive Bonuses |
(a) Vesting Criteria. The Committee shall establish the vesting conditions applicable to an Incentive Bonus, including any performance criteria and level of achievement versus such criteria that may determine the amount payable under an Incentive Bonus, which may include a target, threshold or maximum amount payable and any formula for determining such achievement.
(b) Timing and Form of Payment. The Committee shall determine the timing of payment of any Incentive Bonus. Payment of the amount due under an Incentive Bonus may be made in cash or in Common Stock, as determined by the Committee.
(c) Discretionary Adjustments. Notwithstanding satisfaction of any performance goals, the amount paid under an Incentive Bonus may be adjusted by the Committee on the basis of such further considerations as the Committee shall determine.
| 13. | Performance Awards |
The Committee may establish performance criteria and level of achievement versus such criteria that shall determine the number of shares of Common Stock, Restricted Stock Units, Other Stock-Based Awards or cash to be granted, retained, vested, issued or issuable under or in settlement of or the amount payable pursuant to an Award (any such Award, a “Performance Award”). A Performance Award may be identified as “Performance Share,” “Performance Equity,” “Performance Unit” or other such term as chosen by the Committee.
| 14. | Deferral of Payment |
The Committee may, in an Award Agreement or otherwise, provide for the deferred delivery of Common Stock or cash upon settlement, vesting or other events with respect to Restricted Stock Units, Other Stock-Based Awards or in payment or satisfaction of an Incentive Bonus. Notwithstanding anything herein to the contrary, in no event will any election to defer the delivery of Common Stock or any other payment with respect to any Award be allowed if the Committee determines, in its sole discretion, that the deferral would result in the imposition of the additional tax under Section 409A(a)(1)(B) of the Code. No Award shall provide for deferral of compensation
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that does not comply with Section 409A of the Code. The Company, any Subsidiary or Affiliate which is in existence or hereafter comes into existence, the Board and the Committee shall have no liability to a Participant, or any other party, if an Award that is intended to be exempt from, or compliant with, Section 409A of the Code is not so exempt or compliant or for any action taken by the Board or the Committee in respect thereof.
| 15. | Conditions and Restrictions Upon Securities Subject to Awards |
The Committee may provide that the Common Stock issued upon exercise of an Option or Stock Appreciation Right or otherwise subject to or issued under an Award shall be subject to such further agreements, restrictions, conditions or limitations as the Committee in its discretion may specify prior to the exercise of such Option or Stock Appreciation Right or the grant, vesting or settlement of such Award, including conditions on vesting or transferability, forfeiture or repurchase provisions and method of payment for the Common Stock issued upon exercise, vesting or settlement of such Award (including the actual or constructive surrender of Common Stock already owned by the Participant) or payment of taxes arising in connection with an Award. Without limiting the foregoing, such restrictions may address the timing and manner of any resales by the Participant or other subsequent transfers by the Participant of any shares of Common Stock issued under an Award, including (a) restrictions under an insider trading policy or pursuant to applicable law, (b) restrictions designed to delay or coordinate the timing and manner of sales by the Participant and holders of other Company equity compensation arrangements, (c) restrictions as to the use of a specified brokerage firm for such resales or other transfers and (d) provisions requiring Common Stock be sold on the open market or to the Company in order to satisfy tax withholding or other obligations.
| 16. | Adjustment of and Changes in the Stock |
(a) The number and kind of shares of Common Stock available for issuance under this Plan (including under any Awards then outstanding), and the number and kind of shares of Common Stock subject to the limits set forth in Section 5, shall be equitably adjusted by the Committee to reflect any reorganization, reclassification, combination of shares, stock split, reverse stock split, spin-off, dividend or distribution of securities, property or cash (other than regular, quarterly cash dividends), or any other event or transaction that affects the number or kind of shares of Outstanding Common Stock. Such adjustment may be designed to comply with Section 424 of the Code or may be designed to treat the shares of Common Stock available under the Plan and subject to Awards as if they were all outstanding on the record date for such event or transaction or to increase the number of such shares of Common Stock to reflect a deemed reinvestment in shares of Common Stock of the amount distributed to the Company’s securityholders. The terms of any outstanding Award shall also be equitably adjusted by the Committee as to price, number or kind of shares of Common Stock subject to such Award, vesting, performance criteria, and other terms to reflect the foregoing events, which adjustments need not be uniform as between different Awards or different types of Awards. No fractional shares of Common Stock shall be issued or issuable pursuant to such an adjustment.
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(b) In the event there shall be any other change in the number or kind of outstanding shares of Common Stock, or any stock or other securities into which such Common Stock shall have been changed, or for which it shall have been exchanged, by reason of a Change in Control, other merger, consolidation or otherwise, then the Committee shall determine the appropriate and equitable adjustment to be effected, which adjustments need not be uniform between different Awards or different types of Awards. In addition, in the event of such change described in this paragraph, the Committee may accelerate the time or times at which any Award may be exercised, consistent with and as otherwise permitted under Section 409A of the Code, and may provide for cancellation of such accelerated Awards that are not exercised within a time prescribed by the Committee in its sole discretion.
(c) In the event of a Change in Control, the Committee, acting in its sole discretion without the consent or approval of any Participant, may take one or more of the following actions, which may vary among individual Participants or among Awards held by any individual Participant: (i) arrange for the assumption of an outstanding Award by the successor or acquiring entity (if any) of such Change in Control (or by its parents, if any), which assumption will be binding on all selected Participants; provided that the exercise price and the number and nature of shares issuable upon exercise of any such Option or Stock Appreciation Right, or any Award that is subject to Section 409A of the Code, will be adjusted appropriately pursuant to Section 424(a) of the Code; (ii) provide for the issuance of substitute awards by the successor or acquiring entity (if any) of such Change in Control (or by its parents, if any) that will substantially preserve the otherwise applicable terms of the outstanding Award as determined by the Committee in its sole discretion; (iii) accelerate vesting or waive any forfeiture conditions; (iv) accelerate the time of exercisability of an Award so that such Award may be exercised in full or in part for a limited period of time on or before a date specified by the Committee, after which specified date all unexercised Awards and all rights of Participants thereunder shall terminate; or (v) make such other adjustments to Awards then outstanding as the Committee deems appropriate to reflect such Change in Control. Notwithstanding anything herein to the contrary, in the event of a Change in Control in which the acquiring or surviving company in the transaction does not assume or continue outstanding Awards or issue substitute awards upon the Change in Control, unless determined otherwise by the Committee, immediately prior to the Change in Control, all Awards that are not assumed, continued or substituted for shall be treated as follows effective immediately prior to the Change in Control: (A) in the case of an Option or Stock Appreciation Right, the Participant shall have the ability to exercise such Option or Stock Appreciation Right, including any portion of the Option or Stock Appreciation Right not previously exercisable, (B) in the case of any Award the vesting of which is in whole or in part subject to performance criteria or an Incentive Bonus, all conditions to the grant, issuance, retention, vesting or transferability of, or any other restrictions applicable to, such Award shall immediately lapse and the Participant shall have the right to receive a payment based on target level achievement or actual performance through a date determined by the Committee, and (C) in the case of outstanding Restricted Stock, Restricted Stock Units or Other Stock-Based Awards (other than those referenced in subsection (B)), all conditions to the grant, issuance, retention, vesting or transferability of, or any other restrictions applicable to, such Award shall immediately lapse. In no event shall any action be taken pursuant to this Section 16(c) that would change the payment or settlement date of an Award in a manner that would result in the imposition of any additional taxes or penalties pursuant to Section 409A of the Code.
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(d) Notwithstanding anything in this Section 16 to the contrary, in the event of a Change in Control, the Committee may provide for the cancellation and cash settlement of all outstanding Awards upon such Change in Control (including the cancellation for no consideration of any Option or Stock Appreciation Right with an exercise price that equals or exceeds the per share consideration in such transaction).
(e) Notwithstanding anything in this Section 16 to the contrary, an adjustment to an Option or Stock Appreciation Right under this Section 16 shall be made in a manner that will not result in the grant of a new Option or Stock Appreciation Right under Section 409A of the Code.
| 17. | Transferability |
Each Award may not be sold, transferred for value, pledged, assigned, or otherwise alienated or hypothecated by a Participant other than by will or the laws of descent and distribution, and each Option or Stock Appreciation Right shall be exercisable only by the Participant during his or her lifetime. Notwithstanding the foregoing, (a) outstanding Options may be exercised following the Participant’s death by the Participant’s beneficiaries or as permitted by the Committee and (b) as permitted by the Committee, a Participant may transfer or assign an Award as a gift to any “family member” (as such term is defined in the Registration Statement on Form S-8) (an “Assignee”), provided that such Assignee shall be entitled to exercise assigned Options and Stock Appreciation Rights only during the lifetime of the assigning Participant (or following the assigning Participant’s death, by the Participant’s beneficiaries or as otherwise permitted by the Committee) and provided further that such Assignee shall not further sell, pledge, transfer, assign or otherwise alienate or hypothecate such Award.
| 18. | Compliance with Laws and Regulations |
(a) This Plan, the grant, issuance, vesting, exercise and settlement of Awards hereunder, and the obligation of the Company to sell, issue or deliver shares of Common Stock under such Awards, shall be subject to all applicable foreign, federal, state and local laws, rules and regulations, stock exchange rules and regulations, and to such approvals by any governmental or regulatory agency as may be required. The Company shall not be required to register in a Participant’s name or deliver Common Stock prior to the completion of any registration or qualification of such shares under any foreign, federal, state or local law or any ruling or regulation of any government body which the Committee shall determine to be necessary or advisable. To the extent the Company is unable to or the Committee deems it infeasible to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares of Common Stock hereunder, the Company and its Subsidiaries shall be relieved of any liability with respect to the failure to issue or sell such shares of Common Stock as to which such requisite authority shall not have been obtained. No Option shall be exercisable and no Common Stock shall be issued or transferable under any other Award unless a registration statement with respect to the Common Stock underlying such Award is effective and current or the Company has determined, in its sole and absolute discretion, that such registration is unnecessary.
(b) In the event an Award is granted to or held by a Participant who is employed or providing services outside the United States, the Committee may, in its sole discretion, modify the provisions of the Plan or of such Award as they pertain to such individual to comply with applicable foreign law or to recognize differences in local law, currency or tax policy. The Committee may also impose conditions on the grant, issuance, exercise, vesting, settlement or retention of Awards in order to facilitate compliance with such foreign law or to minimize the Company’s obligations with respect to tax equalization for Participants employed outside their home country.
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| 19. | Withholding |
To the extent required by applicable federal, state, local or foreign law, the Committee may, or a Participant shall, make arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise with respect to any Award or the issuance or sale of any shares of Common Stock. The Company shall not be required to recognize any Participant rights under an Award, to issue shares of Common Stock or to recognize the disposition of such shares of Common Stock until such obligations are satisfied. To the extent permitted or required by the Committee, these obligations may or shall be satisfied by the Company withholding cash from any compensation otherwise payable to or for the benefit of a Participant, the Company withholding a portion of the shares of Common Stock that otherwise would be issued to a Participant under such Award or any other Award held by the Participant, or by the Participant tendering to the Company cash or, if allowed by the Committee, shares of Common Stock.
| 20. | Amendment of the Plan or Awards |
The Board may amend, alter, suspend or terminate this Plan, and the Committee may amend or alter any Award Agreement or other document evidencing an Award made under this Plan; however, except as provided pursuant to the provisions of Section 16, no such amendment shall, without the approval of the stockholders of the Company:
(a) increase the maximum number of shares of Common Stock for which Awards may be granted under this Plan;
(b) extend the term of this Plan;
(c) change the class of persons eligible to be Participants; or
(d) otherwise amend the Plan in any manner requiring stockholder approval by law or the rules of any stock exchange or market or quotation system on which the Common Stock is traded, listed or quoted.
No amendment or alteration to the Plan or an Award or Award Agreement shall be made which would materially impair the rights of the holder of an Award without such holder’s consent; provided, however, that no such consent shall be required if the Committee determines in its sole discretion and prior to the date of any Change in Control that such amendment or alteration either (i) is required or advisable in order for the Company, the Plan or the Award to satisfy any law or regulation or to meet the requirements of, or avoid adverse financial accounting consequences under, any accounting standard, or (ii) is not reasonably likely to significantly diminish the benefits provided under such Award, or that any such diminishment has been adequately compensated.
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| 21. | No Liability of Company |
The Company, any Subsidiary or Affiliate which is in existence or hereafter comes into existence, the Board, the Committee and any delegate thereof shall not be liable to a Participant or any other person as to: (a) the non-issuance or sale of shares of Common Stock as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares of Common Stock hereunder; and (b) any tax consequence expected, but not realized, by any Participant or other person due to the receipt, vesting, exercise or settlement of any Award granted hereunder.
| 22. | Non-Exclusivity of Plan |
Neither the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board or the Committee to adopt such other incentive arrangements as either may deem desirable, including the granting of equity awards otherwise than under this Plan, and such arrangements may be either generally applicable or applicable only in specific cases.
| 23. | Governing Law |
This Plan and any agreements or other documents hereunder shall be interpreted and construed in accordance with the laws of the State of Nevada (without regard to its choice of law provisions) and applicable Federal law. Any reference in this Plan or in the agreement or other document evidencing any Awards to a provision of law or to a rule or regulation shall be deemed to include any successor law, rule or regulation of similar effect or applicability.
| 24. | No Right to Employment, Reelection or Continued Service |
Nothing in this Plan or an Award Agreement shall interfere with or limit in any way the right of the Company, its Subsidiaries or its Affiliates to terminate any Participant’s employment, service on the Board or service at any time or for any reason not prohibited by law, nor shall this Plan or an Award itself confer upon any Participant any right to continue his or her employment or service for any specified period of time. Neither an Award nor any benefits arising under this Plan shall constitute an employment contract with the Company, any Subsidiary or its Affiliates. Subject to Sections 4 and 20, this Plan and the benefits hereunder may be terminated at any time in the sole and exclusive discretion of the Board without giving rise to any liability on the part of the Company, its Subsidiaries or its Affiliates.
| 25. | Specified Employee Delay |
To the extent any payment under this Plan is considered deferred compensation subject to the restrictions contained in Section 409A of the Code, such payment may not be made to a specified employee (as determined in accordance with a uniform policy adopted by the Company with respect to all arrangements subject to Section 409A of the Code) upon Separation from Service before the date that is six months after the specified employee’s Separation from Service (or, if earlier, the specified employee’s death). Any payment that would otherwise be made during this period of delay shall be accumulated and paid on the date that is six months plus one day following the specified employee’s Separation from Service (or, if earlier, as soon as administratively practicable after the specified employee’s death).
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| 26. | No Liability of Committee Members |
No member of the Committee shall be personally liable by reason of any contract or other instrument executed by such member or on his or her behalf in his or her capacity as a member of the Committee nor for any mistake of judgment made in good faith, and the Company shall indemnify and hold harmless each member of the Committee and each other employee, officer or director of the Company to whom any duty or power relating to the administration or interpretation of the Plan may be allocated or delegated, against any cost or expense (including counsel fees) or liability (including any sum paid in settlement of a claim) arising out of any act or omission to act in connection with the Plan, unless arising out of such person’s own fraud or willful bad faith; provided, however, that approval of the Board shall be required for the payment of any amount in settlement of a claim against any such person. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s Certificate of Incorporation and Bylaws (as each may be amended from time to time), as a matter of law, pursuant to any individual agreement or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
| 27. | Severability |
If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, person or Award, and the remainder of the Plan and any such Award shall remain in full force and effect.
| 28. | Unfunded Plan |
The Plan is intended to be an unfunded plan. Participants are and shall at all times be general creditors of the Company with respect to their Awards. If the Committee or the Company chooses to set aside funds in a trust or otherwise for the payment of Awards under the Plan, such funds shall at all times be subject to the claims of the creditors of the Company in the event of its bankruptcy or insolvency.
| 29. | Clawback/Recoupment |
Awards granted under this Plan will be subject to recoupment in accordance with any clawback policy that the Company adopts or is required to adopt pursuant to the listing standards of any national securities exchange or association on which the Company’s securities are listed or as is otherwise required by Rule 10D-1 under the Act or other applicable law. In addition, the Committee may impose such other clawback, recovery or recoupment provisions in an Award Agreement as the Committee determines necessary or appropriate, including a reacquisition right in respect of previously acquired shares of Common Stock or other cash or property upon the occurrence of misconduct. No recovery of compensation under such a clawback policy will be an event giving rise to a right to resign for “good reason” or be deemed a “constructive termination” (or any similar term) as such terms are used in any agreement between any Participant and the Company.
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| 30. | Beneficiary Designation |
Participants may designate beneficiaries with respect to Awards under the Plan in accordance with the procedures determined by the Committee. In the absence of a beneficiary designation, a Participant’s estate will be the deemed beneficiary.
| 31. | Interpretation |
Headings are given to the Sections and subsections of the Plan solely as a convenience to facilitate reference and shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof. Words in the masculine gender shall include the feminine gender, and where appropriate, the plural shall include the singular and the singular shall include the plural. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter. The word “or” is not exclusive. References herein to any agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and not prohibited by the Plan.
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Exhibit 10.14
MENTARI THERAPEUTICS, INC.
2026 EMPLOYEE STOCK PURCHASE PLAN
| 1. | Purpose |
The purpose of this Mentari Therapeutics, Inc. 2026 Employee Stock Purchase Plan (the “Plan”) is to provide employees of the Company and its Designated Subsidiaries with an opportunity to purchase Common Stock through accumulated Contributions. The Company’s intention is to have the Plan qualify as an “employee stock purchase plan” under Section 423 of the Code. The provisions of the Plan, accordingly, will be construed to extend and limit Plan participation on a uniform and nondiscriminatory basis consistent with the requirements of Section 423 of the Code.
| 2. | Definitions. |
As used in the Plan, the following terms shall have the meanings set forth below:
(a) “Administrator” means the Compensation Committee of the Board (or any successor committee), or such other committee as designated by the Board to administer the Plan under Section 14.
(b) “Applicable Laws” means the requirements relating to the administration of equity-based awards under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted, and the applicable laws of any foreign country or jurisdiction where options are, or will be, granted under the Plan.
(c) “Board” means the Board of Directors of the Company.
(d) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and the rulings and regulations issued thereunder.
(e) “Common Stock” means the common stock of the Company, $0.0001 par value per share.
(f) “Company” means Mentari Therapeutics, Inc., a Nevada corporation, and any successor corporation.
(g) “Compensation” means an Eligible Employee’s base salary or base hourly rate of pay before deduction for any salary deferral contributions made by the Eligible Employee to any tax-qualified or nonqualified deferred compensation plan, but excluding commissions, overtime, incentive compensation, bonuses and other forms of compensation. The Administrator, in its discretion, may, on a uniform and nondiscriminatory basis, establish a different definition of Compensation for an Offering Period.
(h) “Contributions” means the payroll deductions and any other additional payments that the Administrator may permit to be made by a Participant to fund the exercise of options granted pursuant to the Plan, subject to Section 423 of the Code.
(i) “Designated Subsidiary” means any Subsidiary that has been designated by the Administrator from time to time in its sole discretion as eligible to participate in the Plan. As of the Effective Date, the Designated Subsidiaries consist exclusively of: Mentari Therapeutics Operating Company LLC.
(j) “Effective Date” means the Closing Date (as defined in the Merger Agreement).
(k) “Eligible Employee” means any person, including an officer, who is customarily employed by the Company or a Designated Subsidiary (i) for more than 20 hours per week and (ii) for more than five months in any calendar year. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company. Where the period of leave exceeds 90 days and the individual’s right to reemployment is not guaranteed either by statute or by contract, the employment relationship shall be deemed to have terminated on the 91st day of such leave. “Eligible Employee” shall not include any person who is a citizen or resident of a foreign jurisdiction if granting them an option under the Plan would violate the law of such jurisdiction, or if compliance with the laws of the jurisdiction would cause the Plan to violate Section 423 of the Code.
(l) “Employer” means the Company and each Designated Subsidiary.
(m) “Exchange Act” means the Securities Exchange Act of 1934, as amended, including the rules and regulations promulgated thereunder.
(n) “Exercise Date” means the last Trading Day of each Purchase Period.
(o) “Fair Market Value” means as of any date, the value of the Common Stock determined as follows: (i) if the Common Stock is listed on any established stock exchange, system or market, its Fair Market Value shall be the closing price for the Common Stock as quoted on such exchange, system or market as reported in the Wall Street Journal or such other source as the Administrator deems reliable (or, if no sale of Common Stock is reported for such date, on the next preceding date on which any sale shall have been reported); and (ii) in the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Administrator.
(p) “Merger Agreement” means that certain Agreement and Plan of Merger and Reorganization dated as of May 19, 2026 by and among the Company, Indigo Merger Sub Corp., Indigo Merger Sub II, LLC and Mentari Therapeutics, Inc.
(q) “New Exercise Date” means a new Exercise Date if the Administrator shortens any Offering Period then in progress.
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(r) “Offering” means an offer under the Plan of an option that may be exercised during an Offering Period as further described in Section 4. For purposes of the Plan, the Administrator may designate separate Offerings under the Plan (the terms of which need not be identical) in which Eligible Employees of one or more Employers will participate, even if the dates of the applicable Offering Periods of each such Offering are identical and the provisions of the Plan will separately apply to each Offering. To the extent permitted by Treasury Regulation Section 1.423-2(a)(1), the terms of each Offering need not be identical; provided, however, that the terms of the Plan and an Offering together satisfy Treasury Regulation Sections 1.423-2(a)(2) and (a)(3).
(s) “Offering Date” means the first Trading Day of each Offering Period.
(t) “Offering Periods” means the periods established by the Administrator (not to exceed 27 months) during which an option granted pursuant to the Plan may be exercised. The duration and timing of Offering Periods may be changed pursuant to Sections 4, 18, and 19. The first Offering Period shall commence on a date established by the Administrator and end on the next April 30 that follows such commencement date, and subsequent Offering Periods shall be each six-month period commencing the day after the prior Offering Period ends and ending on each October 31 and April 30.
(u) “Outstanding Common Stock” means the sum of (i) the shares of Common Stock outstanding, (ii) the shares of Common Stock underlying unexercised pre-funded warrants, and (iii) the shares of Common Stock underlying the Company’s preferred stock, $0.0001 par value per share.
(v) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code.
(w) “Participant” means an Eligible Employee who elects to participate in the Plan.
(x) “Purchase Period” means the period during an Offering Period during which shares of Common Stock may be purchased on a Participant’s behalf in accordance with the terms of the Plan, as established by the Administrator. Unless the Administrator determines otherwise, during the first Offering Period, the Purchase Period will begin on the first date of such Offering Period and end on the last day of such Offering Period, and subsequent Purchase Periods shall be each six-month period commencing thereafter. Unless the Administrator determines otherwise, each Purchase Period following the first Purchase Period will be a six-month period.
(y) “Purchase Price” means an amount equal to 85% of the Fair Market Value of a share of Common Stock on the Offering Date or on the Exercise Date, whichever is lower; provided, however, that the Purchase Price may be determined for subsequent Offering Periods by the Administrator subject to compliance with Section 423 of the Code (or any other Applicable Laws) or pursuant to Section 18.
(z) “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code.
(aa) “Trading Day” means a day on which the national stock exchange upon which the Common Stock is listed is open for trading or, if the Common Stock is not listed on a national stock exchange, a business day as determined by the Administrator in good faith.
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(bb) “Treasury Regulations” means the Treasury regulations promulgated under the Code. Reference to a specific Treasury Regulation or Section of the Code shall include such Treasury Regulation or Section, any valid regulation promulgated under such Section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such Section or regulation.
| 3. | Eligibility. |
(a) Offering Periods. Any Eligible Employee on a given Offering Date will be eligible to participate in the Plan if he or she was employed by the Company or a Designated Subsidiary for at least 30 calendar days (unless otherwise determined by the Administrator) immediately preceding the Offering Date, subject to the requirements of Section 5; provided, however, that an Eligible Employee who commences employment with the Company or a Designated Subsidiary following such 30-day period (or such other period as determined by the Administrator) will be eligible to participate in the Plan at the beginning of the next Purchase Period to occur that is at least 30 calendar days (or such other period as determined by the Administrator) following the commencement of his or her employment with the Company or a Designated Subsidiary. Eligible Employees who do not elect to participate in the Plan on a given Offering Date may elect to participate in the Plan at the beginning of any subsequent Purchase Period, as determined by the Administrator.
(b) Non-U.S. Employees. Employees who are citizens or residents of a non-U.S. jurisdiction (without regard to whether they also are citizens or residents of the United States or resident aliens (within the meaning of Section 7701(b)(1)(A) of the Code)) may be excluded from participation in the Plan or an Offering if the participation of such employees is prohibited under the laws of the applicable jurisdiction or if complying with the laws of the applicable jurisdiction would cause the Plan or an Offering to violate Section 423 of the Code. In addition, as provided in Section 14, the Administrator may establish one or more sub-plans of the Plan (which may, but are not required to, comply with the requirements of Section 423 of the Code) to provide benefits to employees of Designated Subsidiaries located outside the United States in a manner that complies with local law. Any such sub-plan will be a component of the Plan and will not be a separate plan.
(c) Limitations. Any provisions of the Plan to the contrary notwithstanding, no Eligible Employee will be granted an option under the Plan (i) to the extent that, immediately after the grant, such Eligible Employee (or any other person whose stock would be attributed to such Eligible Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company or any Parent or Subsidiary of the Company and/or hold outstanding options to purchase such stock possessing 5% or more of the total combined voting power or value of all classes of the capital stock of the Company or of any Parent or Subsidiary of the Company, or (ii) to the extent that his or her rights to purchase stock under all employee stock purchase plans (as defined in Section 423 of the Code) of the Company or any Parent or Subsidiary of the Company accrues at a rate that exceeds $25,000 worth of stock (determined at the Fair Market Value of the stock at the time such option is granted) for each calendar year in which such option is outstanding at any time, as determined in accordance with Section 423 of the Code and the regulations thereunder.
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| 4. | Offering Periods |
The Plan will be implemented by consecutive Offering Periods with new Offering Periods commencing at such times as determined by the Administrator. The Administrator will have the power to change the duration of Offering Periods (including the commencement dates thereof) without stockholder approval.
| 5. | Participation |
An Eligible Employee may participate in the Plan by (i) submitting to the Company’s Finance department (or its delegate), on or before a date determined by the Administrator prior to an applicable Offering Date, a properly completed subscription agreement authorizing Contributions in the form provided by the Administrator for such purpose, or (ii) following an electronic or other enrollment procedure determined by the Administrator.
| 6. | Contributions |
(a) At the time a Participant enrolls in the Plan pursuant to Section 5, such Participant will elect to have payroll deductions made on each pay day or other Contributions (to the extent permitted by the Administrator) made during the Offering Period (or portion thereof) in an amount equal to at least 1% but not exceeding 15% of the Compensation (or such other percentage of Compensation as determined by the Administrator in its sole discretion, prior to the commencement of an applicable Offering Period), that the Participant receives on each pay day during the Offering Period; provided, however, that should a pay day occur on an Exercise Date, a Participant will have any payroll deductions made on such day applied to his or her notional account under the subsequent Purchase Period or Offering Period. The minimum permissible projected Contribution by any Participant for an Offering Period shall be $500. The maximum permissible Contribution by any Participant for all Offering Periods during any calendar year shall be $25,000. The Administrator, in its sole discretion and to the extent permitted by Section 423 of the Code, may permit all Participants in a specified Offering to contribute amounts to the Plan through payment by cash, check, or other means set forth in the subscription agreement prior to each Exercise Date of each Purchase Period. A Participant’s subscription agreement will remain in effect for successive Offering Periods unless terminated as provided in Section 10.
(b) Payroll deductions for a Participant will commence on the first pay day following the Offering Date (or such later date on which a Participant enrolls in the Plan pursuant to Section 5) and will end on the last pay day prior to the Exercise Date of such Purchase Period to which such authorization is applicable, unless sooner terminated by the Participant as provided in Section 10; provided, however, that with respect to the first Offering Period, payroll deduction for a Participant will not commence until such time as determined by the Administrator.
(c) All Contributions made for a Participant will be credited to his or her notional account under the Plan and payroll deductions will be made in whole percentages only. Except to the extent permitted by the Administrator pursuant to Section 6(a), a Participant may not make any additional payments into such notional account.
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(d) A Participant may discontinue his or her participation in the Plan as provided in Section 10. Participants shall not be permitted to increase or to otherwise decrease their rates of Contributions during a Purchase Period unless otherwise determined by the Administrator in its sole discretion; provided, however, that Participants shall be permitted to increase or decrease their rates of Contributions effective as of the beginning of each Purchase Period.
(e) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code, a Participant’s Contributions may be decreased to 0% at any time during a Purchase Period. Subject to Section 423(b)(8) of the Code, Contributions will recommence at the rate originally elected by the Participant effective as of the beginning of the first Purchase Period scheduled to end in the following calendar year, unless terminated by the Participant as provided in Section 10.
(f) At the time the option under the Plan is exercised, in whole or in part, or at the time some or all of the Common Stock issued under the Plan is disposed of (or any other time that a taxable event related to the Plan occurs), the Participant must make adequate provision for the Company’s or Employer’s federal, state, local, or any other tax liability payable to any authority including taxes imposed by jurisdictions outside of the United States, national insurance, social security, or other tax withholding obligations, if any, that arise upon the exercise of the option or the disposition of the Common Stock (or any other time that a taxable event related to the Plan occurs). At any time, the Company or the Employer may, but will not be obligated to, withhold from the Participant’s compensation the amount necessary for the Company or the Employer to meet applicable withholding obligations, including any withholding required to make available to the Company or the Employer any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Eligible Employee. In addition, the Company or the Employer may, but will not be obligated to, withhold from the proceeds of the sale of Common Stock or any other method of withholding the Company or the Employer deems appropriate to the extent permitted by Treasury Regulation Section 1.423-2(f).
| 7. | Grant of Option |
On the Offering Date of each Offering Period, each Eligible Employee participating in such Offering Period (or any Purchase Period within such Offering Period) will be granted an option to purchase on each Exercise Date during such Offering Period (at the applicable Purchase Price) up to a number of shares of Common Stock determined by dividing (i) such Eligible Employee’s Contributions accumulated prior to such Exercise Date and retained in the Eligible Employee’s notional account as of the Exercise Date by (ii) the applicable Purchase Price; provided, however, that in no event will an Eligible Employee be permitted to purchase during each Purchase Period more than 5,000 shares of Common Stock (subject to any adjustment pursuant to Section 18); provided, further, that such purchase will be subject to the limitations set forth in Sections 3(c) and 13. The Eligible Employee may accept the grant of such option by electing to participate in the Plan in accordance with the requirements of Section 5. The Administrator may, for future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of shares of Common Stock that an Eligible Employee may purchase during each Purchase Period of an Offering Period. Exercise of the option will occur as provided in Section 8, unless the Participant has withdrawn pursuant to Section 10. The option will expire on the last day of the Offering Period.
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| 8. | Exercise of Option |
(a) Unless a Participant withdraws from the Plan as provided in Section 10, such Participant’s option for the purchase of shares of Common Stock will be exercised automatically on the Exercise Date, and the maximum number of full shares subject to the option will be purchased for such Participant at the applicable Purchase Price with the accumulated Contributions from his or her notional account. No fractional shares of Common Stock will be purchased; unless determined by the Administrator, any Contributions accumulated in a Participant’s notional account that are not sufficient to purchase a full share will be retained in the Participant’s notional account for the subsequent Purchase Period or Offering Period, subject to earlier withdrawal by the Participant as provided in Section 10. Any other funds left over in a Participant’s notional account after the Exercise Date will be returned to the Participant (without interest thereon, except as otherwise required under local laws, as further set forth in Section 12). During a Participant’s lifetime, a Participant’s option to purchase shares hereunder is exercisable only by him or her.
(b) If the Administrator determines that, on a given Exercise Date, the number of shares of Common Stock with respect to which options are to be exercised may exceed (i) the number of shares of Common Stock that were available for sale under the Plan on the Offering Date of the applicable Offering Period, or (ii) the number of shares of Common Stock available for sale under the Plan on such Exercise Date, the Administrator may in its sole discretion (x) provide that the Company will make a pro rata allocation of the shares of Common Stock available for purchase on such Offering Date or Exercise Date, as applicable, in as uniform a manner as will be practicable and as it will determine in its sole discretion to be equitable among all Participants exercising options to purchase Common Stock on such Exercise Date, and continue all Offering Periods then in effect, or (y) provide that the Company will make a pro rata allocation of the shares available for purchase on such Offering Date or Exercise Date, as applicable, in as uniform a manner as will be practicable and as it will determine in its sole discretion to be equitable among all Participants exercising options to purchase Common Stock on such Exercise Date, and terminate any or all Offering Periods then in effect pursuant to Section 19. The Company may make a pro rata allocation of the shares available on the Offering Date of any applicable Offering Period pursuant to the preceding sentence, notwithstanding any authorization of additional shares for issuance under the Plan by the Company’s stockholders subsequent to such Offering Date.
| 9. | Delivery |
As soon as reasonably practicable after each Exercise Date on which a purchase of shares of Common Stock occurs, the Company will arrange the delivery to each Participant of the shares purchased upon exercise of his or her option in a form determined by the Administrator (in its sole discretion) and pursuant to rules established by the Administrator. The Company may permit or require that shares be deposited directly with a broker designated by the Company or to a designated agent of the Company, and the Company may utilize electronic or automated methods of share transfer. The Company may require that shares be retained with such broker or agent for a designated period of time and/or may establish other procedures to permit tracking of disqualifying dispositions of such shares. No Participant will have any voting, dividend, or other stockholder rights with respect to shares of Common Stock subject to any option granted under the Plan until such shares have been purchased and delivered to the Participant as provided in this Section 9.
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| 10. | Withdrawal |
A Participant may withdraw all, but not less than all, the Contributions credited to his or her notional account and not yet used to exercise his or her option under the Plan at any time by (a) submitting to the Company’s Finance department (or its delegate) a written notice of withdrawal in the form determined by the Administrator for such purpose, or (b) following an electronic or other withdrawal procedure determined by the Administrator. All the Participant’s Contributions credited to his or her notional account will be paid to such Participant as soon as reasonably practicable after receipt of notice of withdrawal and such Participant’s option for the Offering Period will be automatically terminated, and no further Contributions for the purchase of shares will be made for such Offering Period. If a Participant withdraws from an Offering Period, Contributions will not resume at the beginning of the succeeding Offering Period, unless the Participant re-enrolls in the Plan in accordance with the provisions of Section 5.
| 11. | Termination of Employment |
Upon a Participant’s ceasing to be an Eligible Employee, for any reason, he or she will be deemed to have elected to withdraw from the Plan and the Contributions credited to such Participant’s notional account during the Offering Period but not yet used to purchase shares of Common Stock under the Plan will be returned to such Participant or, in the case of his or her death, to the person or persons entitled thereto under Section 15, and such Participant’s option will be automatically terminated. In no event may a Participant be granted an option under the Plan following his or her termination of employment unless such Participant subsequently becomes an Eligible Employee again.
| 12. | Interest |
No interest will accrue on the Contributions of a Participant in the Plan, except as may be required by Applicable Law, as determined by the Company, and if so required by Applicable Law, such interest shall apply to all Participants in the relevant Offering except to the extent otherwise permitted by Treasury Regulation Section 1.423-2(f).
| 13. | Stock |
(a) Subject to adjustment upon changes in capitalization of the Company as provided in Section 18 hereof, the maximum number of shares of Common Stock that will be made available for sale under the Plan shall be equal to (i) a number equal to the lesser of (x) 1,000,000 or (y) 1% of the total number of shares of Outstanding Common Stock immediately following the closing of the transactions set forth in the Merger Agreement, plus (ii) any shares of Common Stock added as a result of the following sentence (collectively, the “Share Pool”). The Share Pool will automatically increase on January 1 of each year beginning in 2027 and ending with a final increase on January 1, 2036 in an amount equal to the lesser of (x) 1,200,000 or (y) 1% of the Outstanding Common Stock on the preceding December 31; provided, however, that the Administrator may provide that there will be no January 1 increase in the Share Pool for any such year or that the increase in the Share Pool for any such year will be a smaller number of shares of Common Stock than would otherwise occur pursuant to this sentence. The shares of Common Stock issued under this Plan may be shares that are authorized and unissued or shares that were reacquired by the Company, including shares purchased in the open market or in private transactions.
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(b) Until the shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), a Participant will only have the rights of an unsecured creditor with respect to such shares, and no right to vote or receive dividends or any other rights as a stockholder will exist with respect to such shares.
(c) Shares of Common Stock to be delivered to a Participant under the Plan will be registered in the name of the Participant or in the name of the Participant and his or her spouse.
| 14. | Administration |
The Plan shall be administered by the Administrator. The Board shall fill vacancies on, and from time to time may remove or add members to, the Administrator. Any power of the Administrator may also be exercised by the Board. The Administrator will have full and exclusive discretionary authority to construe, interpret, and apply the terms of the Plan, to designate separate Offerings under the Plan, to determine eligibility, to adjudicate all disputed claims filed under the Plan, and to establish such procedures that it deems necessary for the administration of the Plan (including, without limitation, to adopt such procedures and sub-plans as are necessary or appropriate to permit the participation in the Plan by employees who are foreign nationals or employed outside the United States, the terms of which sub-plans may take precedence over other provisions of this Plan, with the exception of Section 13(a), but unless otherwise superseded by the terms of such sub-plan, the provisions of this Plan shall govern the operation of such sub-plan). Unless otherwise determined by the Administrator, the employees eligible to participate in each sub-plan will participate in a separate Offering. Without limiting the generality of the foregoing, the Administrator is specifically authorized to adopt rules and procedures regarding eligibility to participate, the definition of Compensation, handling of Contributions, making of Contributions to the Plan (including, without limitation, in forms other than payroll deductions), establishment of bank or trust accounts to hold Contributions, payment of interest, conversion of local currency, obligations to pay payroll tax, determination of beneficiary designation requirements, withholding procedures, and handling of stock certificates that vary with applicable local requirements. The Administrator also is authorized to determine that, to the extent permitted by Treasury Regulation Section 1.423-2(f), the terms of an option granted under the Plan or an Offering to citizens or residents of a non-U.S. jurisdiction will be less favorable than the terms of options granted under the Plan or the same Offering to employees resident solely in the United States. The Administrator hereby delegates to and designates the most senior officer in the Finance department of the Company (or such other officer with similar authority), and to his or her delegates or designates, the authority to assist the Administrator in the day-to-day administration of the Plan. The Administrator may also delegate some or all of its responsibilities to one or more other persons (which may include Company personnel) and, to the extent there has been any such delegation, any reference in the Plan to the Administrator shall include the delegate of the Administrator. Every finding, decision, and determination made by the Administrator will, to the full extent permitted by Applicable Laws, be final and binding upon all parties.
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| 15. | Designation of Beneficiary |
(a) If permitted by the Administrator, a Participant may file a designation of a beneficiary who is to receive any shares of Common Stock and cash, if any, from the Participant’s notional account under the Plan in the event of such Participant’s death subsequent to an Exercise Date on which the option is exercised but prior to delivery to such Participant of such shares and cash. In addition, if permitted by the Administrator, a Participant may file a designation of a beneficiary who is to receive any cash from the Participant’s notional account under the Plan in the event of such Participant’s death prior to exercise of the option. If a Participant is married and the designated beneficiary is not the spouse, spousal consent will be required for such designation to be effective.
(b) Such designation of beneficiary may be changed by the Participant at any time by notice in a form determined by the Administrator. In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant’s death, the Company will deliver such shares and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the Participant, or if no spouse, dependent, or relative is known to the Company, then to such other person as the Company may designate.
(c) All beneficiary designations will be in such form and manner as the Administrator may designate from time to time. Notwithstanding Sections 15(a) and 15(b), the Company and/or the Administrator may decide not to permit such designations by Participants in non-U.S. jurisdictions to the extent permitted by Treasury Regulation Section 1.423-2(f).
| 16. | Transferability |
Neither Contributions credited to a Participant’s notional account nor any rights with regard to the exercise of an option or to receive shares of Common Stock under the Plan may be assigned, transferred, pledged, or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 15) by the Participant. Any such attempt at assignment, transfer, pledge, or other disposition will be without effect, except that the Company may treat such act as an election to withdraw funds from an Offering Period in accordance with Section 10 hereof.
| 17. | Use of Funds |
The Company may use all Contributions received or held by it under the Plan for any corporate purpose, and the Company will not be obligated to segregate such Contributions except under Offerings in which applicable local law requires that Contributions to the Plan by Participants be segregated from the Company’s general corporate funds and/or deposited with an independent third party for Participants in non-U.S. jurisdictions. Until shares of Common Stock are issued, Participants will only have the rights of an unsecured creditor with respect to such shares.
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| 18. | Adjustments, Dissolution, Liquidation, Merger or Other Corporate Transaction |
(a) Adjustments. In the event that any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Common Stock or other securities of the Company, or other change in the corporate structure of the Company affecting the Common Stock occurs, the Administrator, in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, will, in such manner as it may deem equitable, adjust the number and class of Common Stock that may be delivered under the Plan, the Purchase Price per share and the number of shares of Common Stock covered by each option under the Plan that has not yet been exercised, and the numerical limits of Sections 7 and 13.
(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, any Offering Period then in progress will be shortened by setting a New Exercise Date, and will terminate immediately prior to the consummation of such proposed dissolution or liquidation, unless provided otherwise by the Administrator. The New Exercise Date will be before the date of the Company’s proposed dissolution or liquidation. The Administrator will notify each Participant in writing or electronically, prior to the New Exercise Date, that the Exercise Date for the Participant’s option has been changed to the New Exercise Date and that the Participant’s option will be exercised automatically on the New Exercise Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 10.
(c) Merger or Other Corporate Transaction. In the event of a merger, sale, or other similar corporate transaction involving the Company, each outstanding option will be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. If the successor corporation refuses to assume or substitute for the option, the Offering Period with respect to which such option relates will be shortened by setting a New Exercise Date on which such Offering Period shall end. The New Exercise Date will occur before the date of the Company’s proposed merger, sale, or other similar corporate transaction. The Administrator will notify each Participant in writing or electronically prior to the New Exercise Date, that the Exercise Date for the Participant’s option has been changed to the New Exercise Date and that the Participant’s option will be exercised automatically on the New Exercise Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 10.
| 19. | Amendment or Termination |
(a) The Administrator, in its sole discretion, may amend, suspend, or terminate the Plan, or any part thereof, at any time and for any reason. If the Plan is terminated, the Administrator, in its discretion, may elect to terminate all outstanding Offering Periods either immediately or upon completion of the purchase of shares of Common Stock on the next Exercise Date (which may be sooner than originally scheduled, if determined by the Administrator in its discretion), or may elect to permit Offering Periods to expire in accordance with their terms (and subject to any adjustment pursuant to Section 18). If the Offering Periods are terminated prior to expiration, all amounts then credited to Participants’ notional accounts that have not been used to purchase shares of Common Stock will be returned to the Participants (without interest thereon, except as otherwise required under local laws, as further set forth in Section 12) as soon as administratively practicable.
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(b) Without stockholder consent and without limiting Section 19(a), the Administrator will be entitled to change the Offering Periods or Purchase Periods, designate separate Offerings, limit the frequency and/or number of changes in the amount withheld during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a Participant in order to adjust for delays or mistakes in the Company’s processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each Participant properly correspond with Contribution amounts, and establish such other limitations or procedures as the Administrator determines in its sole discretion advisable that are consistent with the Plan.
(c) In the event the Administrator determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Administrator may, in its discretion and to the extent necessary or desirable, modify, amend, or terminate the Plan to reduce or eliminate such accounting consequence including, but not limited to:
(i) amending the Plan to conform with the safe harbor definition under the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any successor thereto), including with respect to an Offering Period underway at the time;
(ii) altering the Purchase Price for any Offering Period or Purchase Period including an Offering Period or Purchase Period underway at the time of the change in Purchase Price;
(iii) shortening any Offering Period or Purchase Period by setting a New Exercise Date, including an Offering Period or Purchase Period underway at the time of the Administrator action;
(iv) reducing the maximum percentage of Compensation a Participant may elect to set aside as Contributions; and
(v) reducing the maximum number of shares of Common Stock a Participant may purchase during any Offering Period or Purchase Period.
Such modifications or amendments will not require stockholder approval or the consent of any Participants.
| 20. | Notices |
All notices or other communications by a Participant to the Company under or in connection with the Plan will be deemed to have been duly given when received in the form and manner specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.
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| 21. | Conditions Upon Issuance of Shares |
(a) Shares of Common Stock will not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto will comply with all applicable provisions of law, domestic or foreign, including the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and will be further subject to the approval of counsel for the Company with respect to such compliance.
(b) As a condition to the exercise of an option, the Company may require the person exercising such option to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of Applicable Laws.
| 22. | Term of Plan |
The Plan will become effective upon the Effective Date. It will continue in effect until terminated pursuant to Section 19.
| 23. | Stockholder Approval |
The Plan will be subject to approval by the stockholders of the Company within 12 months after the date the Plan is adopted by the Board. Such stockholder approval will be obtained in the manner and to the degree required under Applicable Laws.
| 24. | Governing Law |
This Plan and any agreements or other documents hereunder shall be interpreted and construed in accordance with the laws of the State of Nevada (without regard to its choice of law provisions). Any reference in this Plan or in any agreements or other documents hereunder to a provision of law or to a rule or regulation shall be deemed to include any successor law, rule, or regulation of similar effect or applicability.
| 25. | Severability |
If any provision of the Plan is or becomes or is deemed to be invalid, illegal, or unenforceable for any reason in any jurisdiction or as to any Participant, such invalidity, illegality, or unenforceability shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as to such jurisdiction or Participant as if the invalid, illegal, or unenforceable provision had not been included.
| 26. | Interpretation |
Headings are given to the Sections and subsections of the Plan solely as a convenience to facilitate reference and shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof. Words in the masculine gender shall include the feminine gender, and where appropriate, the plural shall include the singular and the singular
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shall include the plural. The use herein of the word “including” following any general statement, term, or matter shall not be construed to limit such statement, term, or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term, or matter. References herein to any agreement, instrument, or other document means such agreement, instrument, or other document as amended, supplemented, and modified from time to time to the extent permitted by the provisions thereof and not prohibited by the Plan.
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EXHIBIT A
MENTARI THERAPEUTICS, INC.
2026 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
| _____ Original Application |
Offering Date: ______________________________ | |
| _____ Change in Payroll Deduction Rate |
1. hereby elects to participate in the Mentari Therapeutics, Inc. 2026 Employee Stock Purchase Plan (the “Plan”) and subscribes to purchase shares of the Company’s Common Stock in accordance with this Subscription Agreement and the Plan. Capitalized terms used but not defined in this Subscription Agreement have the meanings provided under the Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount of ____% of my Compensation on each payday (from 1% to 15%) during the Offering Period in accordance with the Plan, commencing with the next Offering Period; provided, however, that, in no event may any right to purchase Common Stock under the Plan accrue at a rate exceeding $25,000 of Common Stock (valued as of the applicable Offering Date) in any calendar year, or exceed any lower Contribution limit established under the Plan. The minimum permissible projected Contribution for the Offering Period is $500. (Please note that no fractional percentages are permitted.)
3. I understand that the payroll deductions will be accumulated for the purchase of shares of Common Stock at the applicable Purchase Price determined in accordance with the Plan. I understand that if I do not withdraw from an Offering Period, any accumulated payroll deductions will be used to automatically exercise my option and purchase Common Stock under the Plan.
4. I have received a copy of the complete Plan and its accompanying prospectus. I understand that my participation in the Plan is in all respects subject to the terms of the Plan.
5. Shares of Common Stock purchased for me under the Plan should be issued in the name(s) of (Eligible Employee or Eligible Employee and Spouse only).
6. I understand that if I dispose of any shares received by me pursuant to the Plan within two years after the Offering Date (the first day of the Offering Period during which I purchased such shares) or one year after the Exercise Date, I will be treated for federal income tax purposes as having received ordinary income at the time of such disposition in an amount equal to the excess of the fair market value of the shares at the time such shares were purchased by me over the price that I paid for the shares. The Company may, but will not be obligated to, withhold from my compensation the amount necessary to meet any applicable withholding obligation including
any withholding necessary to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by me. If I dispose of such shares at any time after the expiration of the holding period, I understand that I will be treated for federal income tax purposes as having received income only at the time of such disposition, and that such income will be taxed as ordinary income only to the extent of an amount equal to the lesser of (a) the excess of the fair market value of the shares at the time of such disposition over the Purchase Price which I paid for the shares, or (b) 15% of the fair market value of the shares on the first day of the Offering Period. The remainder of the gain, if any, recognized on such disposition will be taxed as capital gain.
7. I hereby agree to be bound by the terms of the Plan. The effectiveness of this Subscription Agreement is dependent upon my eligibility to participate in the Plan.
| Employee’s Social Security #: |
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| Employee’s Address: |
||
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT WILL REMAIN IN EFFECT THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
| Date: ___________________________________ | ||||
| Signature |
|
A-2
EXHIBIT B
MENTARI THERAPEUTICS, INC.
2026 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned Participant in the Offering Period of the Mentari Therapeutics, Inc. 2026 Employee Stock Purchase Plan that began on ______________, ______ (the “Offering Date”) hereby notifies the Company that he or she hereby withdraws from the Offering Period. He or she hereby directs the Company to pay to the undersigned as soon as reasonably practicable all the payroll deductions credited to his or her notional account with respect to such Offering Period. The undersigned understands and agrees that his or her option for such Offering Period will be automatically terminated. The undersigned understands further that no further payroll deductions will be made for the purchase of shares in the current Offering Period and the undersigned will be eligible to participate in succeeding Offering Periods only by delivering to the Company a new Subscription Agreement.
| Participant’s Name: |
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| Participant’s Address: |
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| Date: ___________________________________ | ||||
| Signature |
|
Exhibit 10.15
Employee Form
MENTARI THERAPEUTICS, INC.
2026 STOCK INCENTIVE PLAN
GRANT NOTICE FOR
STOCK OPTIONS
FOR GOOD AND VALUABLE CONSIDERATION, Mentari Therapeutics, Inc. (the “Company”) hereby grants to the Participant named below an option (the “Option”) to purchase any part or all of the number of shares of Common Stock that are covered by this Option at the exercise price per share, each specified below, and upon the terms and subject to the conditions set forth in this Grant Notice, the Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (as amended from time to time, the “Plan”), and the Standard Terms and Conditions (the “Standard Terms and Conditions”) promulgated under such Plan and attached hereto as Exhibit A. This Option is granted pursuant to the Plan and is subject to and qualified in its entirety by the Standard Terms and Conditions. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.
| Name of the Participant: | [Name] | |
| Grant Date: | [Grant Date] | |
| Number of Shares of Common Stock Covered by the Option: | [Quantity Granted] | |
| Exercise Price Per Share: | [Grant Price] | |
| Expiration Date: | [Expiration Date] | |
| Type of Stock Option: | ☐ Incentive Stock Option
☐ Nonqualified Stock Option | |
| Vesting Commencement Date: | [Vesting Commencement Date] | |
| Vesting Schedule: | Subject to the Plan and the Standard Terms and Conditions, the Option shall vest in accordance with the following schedule, so long as the Participant does not experience a Termination of Service from the Grant Date through such vesting date:
[(i) 25% of the Option shall vest and become exercisable on the first anniversary of the Vesting Commencement Date and (ii) thereafter, this Option shall vest with respect to an additional 1/48th of the Option on each monthly anniversary of the Vesting Commencement Date through the fourth anniversary of the Vesting Commencement Date.] | |
By accepting this Grant Notice, the Participant acknowledges that the Participant has received and read, and agrees that this Option shall be subject to, the terms of this Grant Notice, the Plan, and the Standard Terms and Conditions.
| MENTARI THERAPEUTICS, INC. | ||
| By: |
||
| Name: |
||
| Title: |
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| PARTICIPANT | ||
| [Name] |
||
SIGNATURE PAGE TO
GRANT NOTICE FOR
STOCK OPTIONS
EXHIBIT A
MENTARI THERAPEUTICS, INC.
2026 STOCK INCENTIVE PLAN
STANDARD TERMS AND CONDITIONS FOR
STOCK OPTIONS
These Standard Terms and Conditions apply to the Options granted pursuant to the Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (the “Plan”), which are identified as either Incentive Stock Options or Nonqualified Stock Options and are evidenced by a Grant Notice or an action of the Committee that specifically refers to these Standard Terms and Conditions. In addition to these Standard Terms and Conditions, the Option shall be subject to the terms of the Plan, which are incorporated into these Standard Terms and Conditions by this reference. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.
| 1. | TERMS OF OPTION |
Mentari Therapeutics, Inc. (the “Company”) has granted to the Participant named in the Grant Notice provided to said Participant herewith (the “Grant Notice”) an Incentive Stock Option or a Nonqualified Stock Option as specified in the Grant Notice (the “Option”) to purchase up to the number of shares of Common Stock at an exercise price per share, each as set forth in the Grant Notice. The Option is subject to the conditions set forth in the Grant Notice, these Standard Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the Grant Notice, any reference to the Company shall include a reference to any Subsidiary.
| 2. | STATUS OF THE STOCK OPTION |
(a) If the Option is designated as an “Incentive Stock Option” in the Grant Notice, then this Option is intended to qualify as an “incentive stock option” under Section 422 of the Code. However, the Company does not represent or warrant that the Option qualifies as such. The Participant should consult with the Participant’s own tax advisors regarding the tax effects of the Option and the requirements necessary to obtain favorable income tax treatment under Section 422 of the Code, including the holding period requirements. If the Option is intended to qualify as an “incentive stock option” and the Participant disposes (whether by sale, gift, transfer or otherwise) of any shares of Common Stock acquired upon exercise of the Option within the one-year period beginning on the exercise date or within the two-year period beginning on the Grant Date, the Participant shall notify the Company within 30 days after such disposition.
(b) To the extent that the aggregate Fair Market Value (determined as of the Grant Date) of the shares of Common Stock with respect to which the Option (plus all other incentive stock options held by the Participant) is exercisable for the first time by the Participant during any calendar year (under all plans of the Company and its parent and subsidiary corporations (within the meaning of Section 424 of the Code)) exceeds $100,000, the Option or portions thereof that exceed such limit (according to the order in which they were granted) will be treated as Nonqualified Stock Options. In addition, to the extent any portion of this Option does not qualify as an “incentive stock option,” such portion shall be deemed to be a Nonqualified Stock Option.
EXHIBIT A
STANDARD TERMS AND CONDITIONS FOR STOCK OPTIONS
| 3. | EXERCISE OF OPTION |
(a) The Option shall not be exercisable as of the Grant Date set forth in the Grant Notice. After the Grant Date, to the extent not previously exercised, and subject to termination or acceleration of vesting as provided in these Standard Terms and Conditions and the Plan, the Option shall be exercisable only to the extent it becomes vested, as described in the Grant Notice or the terms of the Plan, to purchase up to that number of shares of Common Stock as set forth in the Grant Notice. The vesting period and/or exercisability of an Option may be adjusted by the Committee to reflect the decreased level of employment during any period in which the Participant is on an approved leave of absence or is employed on a less than full-time basis.
(b) To exercise the Option (or any part thereof), the Participant shall deliver to the Company a “Notice of Exercise” in a form specified by the Committee, specifying the number of whole shares of Common Stock the Participant wishes to purchase and how the Participant’s Common Stock should be registered (in the Participant’s name only or in the Participant’s and the Participant’s spouse’s names as community property or as joint tenants with right of survivorship).
(c) The exercise price (the “Exercise Price”) of the Option is set forth in the Grant Notice. The Company shall not be obligated to issue any shares of Common Stock until the Participant shall have paid the total Exercise Price for that number of shares of Common Stock. The Exercise Price may be paid in Common Stock, cash or a combination thereof, including an irrevocable commitment by a broker to pay over such amount from a sale of the Common Stock issuable under the Option, the delivery of previously owned shares of Common Stock, withholding of shares of Common Stock deliverable upon exercise of the Option (but only to the extent share withholding is made available to the Participant by the Company), or in such other manners as may be permitted by the Committee.
(d) Fractional shares may not be exercised. Common Stock will be issued as soon as practicable after exercise. Notwithstanding the above, the Company shall not be obligated to deliver any Common Stock during any period when the Company determines that the exercisability of the Option or the delivery of Common Stock hereunder would violate Company policy or any federal, state or other applicable laws.
| 4. | EXPIRATION OF OPTION |
The Option shall expire and cease to be exercisable as of the earlier of (i) the Expiration Date set forth in the Grant Notice or (ii) the date specified below in connection with the Participant’s Termination of Service (the date of such Termination of Service, the “Termination Date”), subject to any automatic extension under Section 8(a) of the Plan:
(a) If the Participant’s Termination of Service is as a result of the Participant’s death, (i) the entire Option shall be fully vested as of the Termination Date and (ii) the Participant’s designated beneficiary or estate (as applicable) may exercise any portion of the Option until the first anniversary of the Termination Date.
(b) If the Participant’s Termination of Service is as a result of the Participant’s Disability, (i) any portion of the Option which is unvested as of the Termination Date shall remain outstanding until the date that is three months following the Termination Date (provided that there shall be no further vesting during such period unless expressly determined otherwise by the Committee), and (ii) the Participant may exercise any portion of the Option that is vested and exercisable as of the Termination Date until the first anniversary of the Termination Date.
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(c) If the Participant’s Termination of Service is as a result of a Qualifying Termination, subject to the Participant’s execution and nonrevocation of a general release of claims in a form provided by the Company within 60 days of the Termination Date, (i) the entire Option shall be fully vested and (ii) the Participant may exercise any portion of the Option until the date that is three months following the Termination Date.
(d) If the Participant’s Termination of Service is by the Company for Cause, the entire Option, whether or not then vested and exercisable, shall be immediately forfeited and canceled as of the Termination Date.
(e) If the Participant’s Termination of Service is for any reason other than as set forth in Section 4(a), 4(b) or 4(c), the Participant may exercise any portion of the Option that is vested and exercisable as of the Termination Date until the date that is three months following the Termination Date.
(f) Any portion of the Option that is not vested and exercisable at the time of a Termination of Service (after taking into account any accelerated vesting under this Section 4, Section 16 of the Plan and any Employment Arrangement (as defined below)) shall be forfeited and canceled as of the Termination Date.
(g) As used in this Section 4:
(i) “Good Reason” has the meaning set forth in the Employment Arrangement, or if there is no Employment Arrangement or no such term is defined in such Employment Arrangement, means, without the Participant’s consent: (A) a material diminution in the Participant’s base salary; (B) a relocation of the Participant’s principal place of employment by more than 50 miles; or (C) a material breach by the Company of any of its obligations under the Grant Notice or these Standard Terms and Conditions. Notwithstanding the foregoing, any assertion by the Participant of a termination for Good Reason shall not be effective unless (1) the Participant provides written notice to the Company of the existence of one or more of the foregoing conditions within 30 days after the initial occurrence of such condition(s); (2) the condition(s) specified in such notice remain uncorrected for 30 days following the Company’s receipt of such written notice (the “Cure Period”); and (3) the date of the termination of the Participant’s employment occurs within 30 days after the end of the Cure Period.
(ii) “Qualifying Termination” means the Participant’s Termination of Service by the Company without Cause (and not as a result of death or Disability) or by the Participant for Good Reason, in each case, on or within 12 months following a Change in Control.
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| 5. | RESTRICTIONS ON RESALES OF SHARES ACQUIRED PURSUANT TO OPTION EXERCISE |
The Company may impose such restrictions, conditions or limitations as it determines appropriate as to the timing and manner of any resales by the Participant or other subsequent transfers by the Participant of any Common Stock issued as a result of the exercise of the Option, including (a) restrictions under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by the Participant and other option holders and (c) restrictions as to the use of a specified brokerage firm for such resales or other transfers.
| 6. | INCOME TAXES |
The Company shall not deliver Common Stock in respect of the exercise of any Option unless and until the Participant has made arrangements satisfactory to the Company to satisfy applicable withholding tax obligations. Unless the Participant pays the withholding tax obligations to the Company by cash or check in connection with the exercise of the Option (including an irrevocable commitment by a broker to pay over such amount from a sale of the Common Stock issuable under the Option), withholding may be effected, at the Company’s election, by withholding shares of Common Stock issuable in connection with the exercise of the Option (provided that shares of Common Stock may be withheld only to the extent that such withholding will not result in adverse accounting treatment for the Company). The Participant acknowledges that the Company shall have the right to deduct any taxes required to be withheld by law in connection with the exercise of the Option from any amounts payable by it to the Participant (including future cash wages).
| 7. | NON-TRANSFERABILITY OF OPTION |
Except as permitted by the Committee or as permitted under the Plan, the Participant may not assign or transfer the Option to anyone other than by will or the laws of descent and distribution and the Option shall be exercisable only by the Participant during his or her lifetime. The Company may cancel the Participant’s Option if the Participant attempts to assign or transfer it in a manner inconsistent with this Section 7. Notwithstanding the foregoing, upon the Participant’s death, the Option shall be transferred to the Participant’s designated beneficiary or, if none, to the Participant’s estate.
| 8. | OTHER AGREEMENTS SUPERSEDED |
The Grant Notice, these Standard Terms and Conditions, and the Plan constitute the entire understanding between the Participant and the Company regarding the Option; provided, however, that any provisions regarding the acceleration of the Option (or other Awards) upon a Termination of Service set forth in any written employment, offer, services or severance agreement or letter between the Participant and the Company or under the terms of any severance plan in which the Participant participates (such agreement, letter or plan, an “Employment Arrangement”) shall continue to apply to the Option. Any prior agreements, commitments or negotiations concerning the Option are superseded.
| 9. | LIMITATION OF INTEREST IN SHARES SUBJECT TO OPTION |
Neither the Participant (individually or as a member of a group) nor any beneficiary or other person claiming under or through the Participant shall have any right, title, interest, or privilege in or to any shares of Common Stock allocated or reserved for the purpose of the Plan or subject to the Grant Notice or these Standard Terms and Conditions except as to such Common Stock, if any, as shall have been issued to such person upon exercise of the Option or any part of it. Nothing in the Plan, in the Grant Notice, these Standard Terms and Conditions or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company’s employ or service nor limit in any way the Company’s right to terminate the Participant’s employment or service at any time for any reason.
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| 10. | NO LIABILITY OF COMPANY |
The Company and any Affiliate which is in existence or hereafter comes into existence shall not be liable to the Participant or any other person as to: (a) the non-issuance or sale of shares of Common Stock as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares hereunder; and (b) any tax consequence expected, but not realized, by the Participant or other person due to the receipt, exercise or settlement of any Option granted hereunder.
| 11. | GENERAL |
(a) In the event that any provision of these Standard Terms and Conditions is declared to be illegal, invalid or otherwise unenforceable by a court of competent jurisdiction, such provision shall be reformed, if possible, to the extent necessary to render it legal, valid and enforceable, or otherwise deleted, and the remainder of these Standard Terms and Conditions shall not be affected except to the extent necessary to reform or delete such illegal, invalid or unenforceable provision.
(b) The headings preceding the text of the sections hereof are inserted solely for convenience of reference and shall not constitute a part of these Standard Terms and Conditions, nor shall they affect its meaning, construction or effect. Words in the masculine gender shall include the feminine gender, and where appropriate, the plural shall include the singular and the singular shall include the plural. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter. References herein to any agreement, instrument or other document mean such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and not prohibited by the Plan or these Standard Terms and Conditions.
(c) These Standard Terms and Conditions shall inure to the benefit of and be binding upon the parties hereto and their respective permitted heirs, beneficiaries, successors and assigns.
(d) These Standard Terms and Conditions shall be construed in accordance with and governed by the laws of the State of Nevada, without regard to principles of conflicts of law.
(e) In the event of any conflict between the Grant Notice, these Standard Terms and Conditions and the Plan, the Grant Notice and these Standard Terms and Conditions shall control. In the event of any conflict between the Grant Notice and these Standard Terms and Conditions, the Grant Notice shall control.
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(f) All questions arising under the Plan or under these Standard Terms and Conditions shall be decided by the Committee in its total and absolute discretion.
| 12. | CLAWBACK |
The Option and any Common Stock received upon exercise of the Option are subject to any recoupment policy that the Company may adopt from time to time, to the extent any such policy is applicable to the Participant and to such compensation, including the Mentari Therapeutics, Inc. Compensation Recoupment (Clawback) Policy (as amended from time to time), designed to comply with the requirements of Rule 10D-1 promulgated under the Act, as well as any recoupment provisions required under applicable law. For purposes of the foregoing, the Participant expressly and explicitly authorizes (x) the Company to issue instructions, on the Participant’s behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold Common Stock and other amounts acquired under the Option or the Plan to re-convey, transfer or otherwise return such Common Stock and/or other amounts to the Company and (y) the Company’s recovery of any covered compensation through any method of recovery that the Company deems appropriate, including by reducing any amount that is or may become payable to the Participant. The Participant further agrees to comply with any request or demand for repayment by the Company or any Affiliate in order to comply with such policies or applicable law. To the extent that these Standard Terms and Conditions and any Company recoupment policy conflict, the terms of the recoupment policy shall prevail.
| 13. | ELECTRONIC DELIVERY |
By executing or otherwise accepting the Grant Notice, the Participant hereby consents to the delivery of information (including information required to be delivered to the Participant pursuant to applicable securities laws) regarding the Company and the Subsidiaries, the Plan, the Option and the Common Stock via Company website or other electronic delivery.
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Exhibit 10.16
Director Form
MENTARI THERAPEUTICS, INC.
2026 STOCK INCENTIVE PLAN
GRANT NOTICE FOR
STOCK OPTIONS
FOR GOOD AND VALUABLE CONSIDERATION, Mentari Therapeutics, Inc. (the “Company”) hereby grants to the Participant named below an option (the “Option”) to purchase any part or all of the number of shares of Common Stock that are covered by this Option at the exercise price per share, each specified below, and upon the terms and subject to the conditions set forth in this Grant Notice, the Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (as amended from time to time, the “Plan”), and the Standard Terms and Conditions (the “Standard Terms and Conditions”) promulgated under such Plan and attached hereto as Exhibit A. This Option is granted pursuant to the Plan and is subject to and qualified in its entirety by the Standard Terms and Conditions. Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan.
| Name of the Participant: |
[Name] | |
| Grant Date: |
[Grant Date] | |
| Number of Shares of Common Stock Covered by the Option: |
[Quantity Granted] | |
| Exercise Price Per Share: |
[Grant Price] | |
| Expiration Date: |
[Expiration Date] | |
| Type of Stock Option: |
Nonqualified Stock Option | |
| Vesting Commencement Date: |
[Vesting Commencement Date] | |
| Vesting Schedule: |
Subject to the Plan and the Standard Terms and Conditions, [this Option shall vest and become exercisable on the earlier of the first anniversary of the Vesting Commencement Date or the Company’s next annual meeting of stockholders, so long as the Participant does not experience a Termination of Service from the Grant Date through such vesting date; provided, however, that in the event of a Change in Control, this Option shall become fully vested and exercisable so long as the Participant does not experience a Termination of Service from the Grant Date through the date of such Change in Control.]1 | |
| 1 | For annual grants. |
| [this Option shall vest and become exercisable in equal monthly installments on each monthly anniversary of the Vesting Commencement Date until the third anniversary of the Vesting Commencement Date, so long as the Participant does not experience a Termination of Service from the Grant Date through such vesting date; provided, however, that in the event of a Change in Control, this Option shall become fully vested and exercisable so long as the Participant does not experience a Termination of Service from the Grant Date through the date of such Change in Control.]2 |
| 2 | For initial grants. |
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By accepting this Grant Notice, the Participant acknowledges that the Participant has received and read, and agrees that this Option shall be subject to, the terms of this Grant Notice, the Plan, and the Standard Terms and Conditions.
| MENTARI THERAPEUTICS, INC. | ||
| By: |
| |
| Name: | ||
| Title: | ||
| PARTICIPANT | ||
|
| ||
| [Name] | ||
SIGNATURE PAGE TO
GRANT NOTICE FOR
STOCK OPTIONS
EXHIBIT A
MENTARI THERAPEUTICS, INC.
2026 STOCK INCENTIVE PLAN
STANDARD TERMS AND CONDITIONS FOR
STOCK OPTIONS
These Standard Terms and Conditions apply to the Options granted pursuant to the Mentari Therapeutics, Inc. 2026 Stock Incentive Plan (the “Plan”), which are evidenced by a Grant Notice or an action of the Committee that specifically refers to these Standard Terms and Conditions. In addition to these Standard Terms and Conditions, the Option shall be subject to the terms of the Plan, which are incorporated into these Standard Terms and Conditions by this reference. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.
| 1. | TERMS OF OPTION |
Mentari Therapeutics, Inc. (the “Company”) has granted to the Participant named in the Grant Notice provided to said Participant herewith (the “Grant Notice”) a Nonqualified Stock Option (the “Option”) to purchase up to the number of shares of Common Stock at an exercise price per share, each as set forth in the Grant Notice. The Option is subject to the conditions set forth in the Grant Notice, these Standard Terms and Conditions, and the Plan. For purposes of these Standard Terms and Conditions and the Grant Notice, any reference to the Company shall include a reference to any Subsidiary.
| 2. | STATUS OF THE STOCK OPTION |
This Option is not intended to qualify as an “incentive stock option” under Section 422 of the Code.
| 3. | EXERCISE OF OPTION |
(a) The Option shall not be exercisable as of the Grant Date set forth in the Grant Notice. After the Grant Date, to the extent not previously exercised, and subject to termination or acceleration of vesting as provided in these Standard Terms and Conditions and the Plan, the Option shall be exercisable only to the extent it becomes vested, as described in the Grant Notice or the terms of the Plan, to purchase up to that number of shares of Common Stock as set forth in the Grant Notice.
(b) To exercise the Option (or any part thereof), the Participant shall deliver to the Company a “Notice of Exercise” in a form specified by the Committee, specifying the number of whole shares of Common Stock the Participant wishes to purchase and how the Participant’s Common Stock should be registered (in the Participant’s name only or in the Participant’s and the Participant’s spouse’s names as community property or as joint tenants with right of survivorship).
(c) The exercise price (the “Exercise Price”) of the Option is set forth in the Grant Notice. The Company shall not be obligated to issue any shares of Common Stock until the Participant shall have paid the total Exercise Price for that number of shares of Common Stock.
EXHIBIT A
STANDARD TERMS AND CONDITIONS FOR STOCK OPTIONS
The Exercise Price may be paid in Common Stock, cash or a combination thereof, including an irrevocable commitment by a broker to pay over such amount from a sale of the Common Stock issuable under the Option, the delivery of previously owned shares of Common Stock, withholding of shares of Common Stock deliverable upon exercise of the Option (but only to the extent share withholding is made available to the Participant by the Company), or in such other manners as may be permitted by the Committee.
(d) Fractional shares may not be exercised. Common Stock will be issued as soon as practicable after exercise. Notwithstanding the above, the Company shall not be obligated to deliver any Common Stock during any period when the Company determines that the exercisability of the Option or the delivery of Common Stock hereunder would violate Company policy or any federal, state or other applicable laws.
| 4. | EXPIRATION OF OPTION |
The Option shall expire and cease to be exercisable as of the earlier of (i) the Expiration Date set forth in the Grant Notice or (ii) the date specified below in connection with the Participant’s Termination of Service (the date of such Termination of Service, the “Termination Date”), subject to any automatic extension under Section 8(a) of the Plan:
(a) If the Participant’s Termination of Service is as a result of the Participant’s death, (i) the entire Option shall be fully vested as of the Termination Date and (ii) the Participant’s designated beneficiary or estate (as applicable) may exercise any portion of the Option until the first anniversary of the Termination Date.
(b) If the Participant’s Termination of Service is as a result of the Participant’s Disability, (i) any portion of the Option which is unvested as of the Termination Date shall remain outstanding until the date that is three months following the Termination Date (provided that there shall be no further vesting during such period unless expressly determined otherwise by the Committee), and (ii) the Participant may exercise any portion of the Option that is vested and exercisable as of the Termination Date until the first anniversary of the Termination Date.
(c) If the Participant’s Termination of Service is by the Company for Cause, the entire Option, whether or not then vested and exercisable, shall be immediately forfeited and canceled as of the Termination Date.
(d) If the Participant’s Termination of Service is for any reason other than as set forth in Section 4(a), 4(b) or 4(c), the Participant may exercise any portion of the Option that is vested and exercisable as of the Termination Date until the date that is three months following the Termination Date.
(e) Any portion of the Option that is not vested and exercisable at the time of a Termination of Service (after taking into account any accelerated vesting under this Section 4, Section 16 of the Plan and any other agreement between the Participant and the Company) shall be forfeited and canceled as of the Termination Date.
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| 5. | RESTRICTIONS ON RESALES OF SHARES ACQUIRED PURSUANT TO OPTION EXERCISE |
The Company may impose such restrictions, conditions or limitations as it determines appropriate as to the timing and manner of any resales by the Participant or other subsequent transfers by the Participant of any Common Stock issued as a result of the exercise of the Option, including (a) restrictions under an insider trading policy, (b) restrictions designed to delay and/or coordinate the timing and manner of sales by the Participant and other option holders and (c) restrictions as to the use of a specified brokerage firm for such resales or other transfers.
| 6. | INCOME TAXES |
The Company shall not deliver Common Stock in respect of the exercise of any Option unless and until the Participant has made arrangements satisfactory to the Company to satisfy applicable withholding tax obligations. Unless the Participant pays the withholding tax obligations to the Company by cash or check in connection with the exercise of the Option (including an irrevocable commitment by a broker to pay over such amount from a sale of the Common Stock issuable under the Option), withholding may be effected, at the Company’s election, by withholding shares of Common Stock issuable in connection with the exercise of the Option (provided that shares of Common Stock may be withheld only to the extent that such withholding will not result in adverse accounting treatment for the Company). The Participant acknowledges that the Company shall have the right to deduct any taxes required to be withheld by law in connection with the exercise of the Option from any amounts payable by it to the Participant (including future cash fees or other compensation).
| 7. | NON-TRANSFERABILITY OF OPTION |
Except as permitted by the Committee or as permitted under the Plan, the Participant may not assign or transfer the Option to anyone other than by will or the laws of descent and distribution and the Option shall be exercisable only by the Participant during his or her lifetime. The Company may cancel the Participant’s Option if the Participant attempts to assign or transfer it in a manner inconsistent with this Section 7. Notwithstanding the foregoing, upon the Participant’s death, the Option shall be transferred to the Participant’s designated beneficiary or, if none, to the Participant’s estate.
| 8. | OTHER AGREEMENTS SUPERSEDED |
The Grant Notice, these Standard Terms and Conditions, and the Plan constitute the entire understanding between the Participant and the Company regarding the Option; provided, however, that any provisions regarding the acceleration of the Option (or other Awards) upon a Termination of Service set forth in any written employment, offer, services or severance agreement or letter between the Participant and the Company or under the terms of any severance plan in which the Participant participates shall continue to apply to the Option. Any prior agreements, commitments or negotiations concerning the Option are superseded.
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| 9. | LIMITATION OF INTEREST IN SHARES SUBJECT TO OPTION |
Neither the Participant (individually or as a member of a group) nor any beneficiary or other person claiming under or through the Participant shall have any right, title, interest, or privilege in or to any shares of Common Stock allocated or reserved for the purpose of the Plan or subject to the Grant Notice or these Standard Terms and Conditions except as to such Common Stock, if any, as shall have been issued to such person upon exercise of the Option or any part of it. Nothing in the Plan, in the Grant Notice, these Standard Terms and Conditions or any other instrument executed pursuant to the Plan shall confer upon the Participant any right to continue in the Company’s employ or service nor limit in any way the right of the Company’s stockholders to remove the Participant in accordance with applicable law and the Company’s governing documents.
| 10. | NO LIABILITY OF COMPANY |
The Company and any Affiliate which is in existence or hereafter comes into existence shall not be liable to the Participant or any other person as to: (a) the non-issuance or sale of shares of Common Stock as to which the Company has been unable to obtain from any regulatory body having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any shares hereunder; and (b) any tax consequence expected, but not realized, by the Participant or other person due to the receipt, exercise or settlement of any Option granted hereunder.
| 11. | GENERAL |
(a) In the event that any provision of these Standard Terms and Conditions is declared to be illegal, invalid or otherwise unenforceable by a court of competent jurisdiction, such provision shall be reformed, if possible, to the extent necessary to render it legal, valid and enforceable, or otherwise deleted, and the remainder of these Standard Terms and Conditions shall not be affected except to the extent necessary to reform or delete such illegal, invalid or unenforceable provision.
(b) The headings preceding the text of the sections hereof are inserted solely for convenience of reference and shall not constitute a part of these Standard Terms and Conditions, nor shall they affect their meaning, construction or effect. Words in the masculine gender shall include the feminine gender, and where appropriate, the plural shall include the singular and the singular shall include the plural. The use herein of the word “including” following any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter. References herein to any agreement, instrument or other document mean such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and not prohibited by the Plan or these Standard Terms and Conditions.
(c) These Standard Terms and Conditions shall inure to the benefit of and be binding upon the parties hereto and their respective permitted heirs, beneficiaries, successors and assigns.
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(d) These Standard Terms and Conditions shall be construed in accordance with and governed by the laws of the State of Nevada, without regard to principles of conflicts of law.
(e) In the event of any conflict between the Grant Notice, these Standard Terms and Conditions and the Plan, the Grant Notice and these Standard Terms and Conditions shall control. In the event of any conflict between the Grant Notice and these Standard Terms and Conditions, the Grant Notice shall control.
(f) All questions arising under the Plan or under these Standard Terms and Conditions shall be decided by the Committee in its total and absolute discretion.
| 12. | CLAWBACK |
The Option and any Common Stock received upon exercise of the Option are subject to any recoupment policy that the Company may adopt from time to time, to the extent any such policy is applicable to the Participant and to such compensation, including the Mentari Therapeutics, Inc. Compensation Recoupment (Clawback) Policy (as amended from time to time), designed to comply with the requirements of Rule 10D-1 promulgated under the Act, as well as any recoupment provisions required under applicable law. For purposes of the foregoing, the Participant expressly and explicitly authorizes (x) the Company to issue instructions, on the Participant’s behalf, to any brokerage firm and/or third-party administrator engaged by the Company to hold Common Stock and other amounts acquired under the Option or the Plan to re-convey, transfer or otherwise return such Common Stock and/or other amounts to the Company and (y) the Company’s recovery of any covered compensation through any method of recovery that the Company deems appropriate, including by reducing any amount that is or may become payable to the Participant. The Participant further agrees to comply with any request or demand for repayment by the Company or any Affiliate in order to comply with such policies or applicable law. To the extent that these Standard Terms and Conditions and any Company recoupment policy conflict, the terms of the recoupment policy shall prevail.
| 13. | ELECTRONIC DELIVERY |
By executing or otherwise accepting the Grant Notice, the Participant hereby consents to the delivery of information (including information required to be delivered to the Participant pursuant to applicable securities laws) regarding the Company and the Subsidiaries, the Plan, the Option and the Common Stock via Company website or other electronic delivery.
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Exhibit 14.1
CODE OF BUSINESS CONDUCT
November 6, 2026
| I. | INTRODUCTION |
This Code of Business Conduct (this “Code”) provides a general statement of the expectations of Mentari Therapeutics, Inc. (the “Company”) regarding the ethical standards to which each director, officer and employee should adhere while acting on behalf of the Company. You are expected to read and become familiar with the ethical standards described in this Code and will be required, from time to time, to affirm your agreement to adhere to such standards by signing the Compliance Certificate that appears at the end of this Code.
We are proud of what the Company has accomplished to date, and your commitment to continued excellence is crucial as the Company changes and grows. We expect all individuals associated with the Company to conduct themselves with the highest degree of honesty and integrity at all times.
This Code should be read in conjunction with our other policies and procedures, copies of which are available from Human Resources. This Code is not a substitute for those other documents. Instead, this Code should be viewed as a general statement of the guiding principles that should help you keep our core values in mind as you conduct business on behalf of the Company.
We consider any violation of this Code to be a serious breach of our trust, and any violation may result in disciplinary action up to and including termination, as well as potential civil or criminal penalties, depending on the nature of the violation and applicable law. Similarly, if you are aware of someone’s violation of this Code, you have a duty to report the violation in accordance with the procedures detailed below. We depend on your commitment to protect our culture and values and will view your reporting of violations in that context.
While this Code covers multiple scenarios and activities, it does not address every situation that could arise. Therefore, if you are faced with an issue that you feel may not be covered specifically by this Code and are making a decision to act, please keep the following in mind:
| • | Consider whether your actions would conform to the intent of the Code. |
| • | Consider whether your actions could create even a perception of impropriety. |
| • | Make sure you have all of the relevant facts. |
| • | Consider discussing the matter with your supervisor, as applicable, or reporting the matter anonymously as described below. |
| • | Consider seeking help. It is always better to seek assistance before you act, rather than making a preventable mistake. |
If you encounter a situation where you have a question about the law, the Code or any Company policy or are unsure of the best course of action, you should always seek guidance. Except as otherwise specifically noted in the Code, when you have a specific question, please contact your supervisor, Human Resources or the General Counsel (“GC”).
| II. | REPORTING VIOLATIONS |
If you know or reasonably believe that there has been a violation of this Code or any illegal behavior, you must report such violation or illegal behavior to your supervisor, Human Resources or the GC. Additionally, employees, consultants and others may report any violations of this Code or any other illegal behavior anonymously through the Company’s whistleblower hotline. There are three methods of logging complaints anonymously:
Website: https://report.syntrio.com/mentaritx
Toll-Free Telephone: 877-893-1393 (English) and 800-216-1288 (Spanish)
Fax: 215-689-3885 (must include company name with report)
Such complaints will be directed to the GC. However, if the complaint involves the GC, or otherwise gives rise to a conflict of interest, such complaints will be directed to the Chief Executive Officer (the “CEO”).
Failure to report a known or suspected violation of this Code is itself a violation and may result in disciplinary action up to and including termination.
Any director, officer or employee who obtains information about a Code violation or illegal act has the responsibility to report the matter immediately to one of the above individuals. The Company will not discharge, demote, suspend, threaten, harass or in any manner discriminate or tolerate discrimination or retaliation against any director, officer or employee for reporting, in good faith, a potential violation, and any supervisor intimidating or imposing sanctions on any such person for reporting a matter in good faith will be disciplined.
Nothing in this Code is intended, or should be understood, to preclude employees from exercising their rights under the National Labor Relations Act.
| III. | PERSONAL RESPONSIBILITY AND INTEGRITY |
| A. | Fair Dealing |
You are expected to be ethical and should deal fairly with customers, vendors, suppliers, business partners, service providers, competitors and employees. You should not take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair-dealing practice.
| B. | Confidential Information and Privacy |
The Company holds many types of confidential information that must be carefully safeguarded. Protecting this information is essential to maintaining our relationships and protecting our intellectual property. In addition, Company information, which includes confidential information and third-party information the Company has a duty to keep confidential (such as patient and employee health information), should not be used other than for its intended use, and documents that include such information should be disposed of properly and should not be copied or removed from the work area, except as required for job performance. Confidential information should not be disclosed to outsiders without specific approval by the Company.
Confidential information includes:
| • | information marked “Confidential,” “Private,” “For Internal Use Only” or with a similar legend; |
| • | technical or scientific information relating to current and future product candidates, services or research; |
| • | business or marketing plans, strategies, forecasts or projections; |
| • | budgets, earnings and other internal financial data; |
| • | personnel information; |
| • | business contracts; |
| • | training materials and methods; |
| • | other non-public information that, if disclosed, might be of use to the Company’s competitors or harmful to the Company or its business partners; and |
| • | other non-public information that, if disclosed, would violate federal or state securities laws. |
Regardless of whether information is specifically marked as confidential, it is each employee’s responsibility to keep confidential information in confidence (except as otherwise required, if at all, by applicable law). You must not use, reveal or divulge any such information unless it is necessary for you to do so in the performance of your duties (or except as otherwise required, if at all, by applicable law). Generally, access to confidential information should be granted, provided or given on a “need-to-know” basis. For more information regarding your confidentiality obligations with respect to prediction market or event contract transactions, please review our Insider Trading Policy.
| C. | Use of Company Systems and Devices |
The data and other information you use, send, receive and store on the Company’s telecommunications equipment (including email, voicemail and the internet) are business records owned by the Company. Therefore, subject to applicable laws and regulations, the Company has the right to access, read, monitor, inspect, review and disclose the contents of, postings to and downloads from all of the Company’s information systems. In addition, your use of the Company’s systems and equipment reflects on the Company as a whole, and at no time may you use the Company systems or equipment to view, access, store, share or send illegal, derogatory, harassing or inappropriate information, including obscene, racist or sexually explicit information, or engage in any activity that violates the intellectual property rights of others.
Directors, officers and employees who use a personal mobile phone, tablet or computer for Company business must comply with any Company information security or acceptable use policies the Company has adopted or may adopt from time to time (including requirements relating to device security controls, Company-approved applications, and the Company’s ability to access, preserve or remotely remove Company data from such devices to the extent permitted by law). You should be aware that the data and other information you use, send, receive and store on any personal devices used for business purposes are business records owned by the Company to the same extent as if they had been created on the Company’s information systems. You should have no expectation of privacy with respect to these communications and data. To the extent permitted by law, the Company has the ability, and reserves the right, to monitor all electronic and telephonic communication and to access and search all electronic media or other items contained in or used in conjunction with the Company’s computer, email, voicemail and Internet access systems and equipment with no prior notice. These communications may also be subject to disclosure to law enforcement or government officials.
| D. | Use of Social Media |
We strongly encourage all directors, officers and employees to avoid references to the Company on social networking sites or other Internet based communications sites, except that you are encouraged to share, like or re-post content shared on official Company channels and may also utilize Company-provided content that has been approved by the Company for personal social media use; provided that any use of social media and other Internet based communications sites must comply with our Policy on Public Disclosures and Communications with the Investment Community (“Investment Community Disclosure Policy”).
| E. | Conflicts of Interest |
Directors, officers and employees should avoid activities that create or give the appearance of a conflict of interest between their personal interests and the Company’s interests. A conflict of interest exists when a personal interest or activity of a director, officer or employee could influence or interfere with that person’s performance of duties, responsibilities or commitments to the Company. A conflict of interest also exists when a director, officer or employee (or member of his or her family) receives an improper personal benefit as a result of his or her position at the Company. Below are some examples of situations that could result in a conflict of interest:
| • | be a consultant to, or a director, officer or employee of, or otherwise operate, an outside business that is a significant competitor, supplier or customer of the Company; |
| • | be a consultant to, or a director, officer or employee of, or otherwise operate, an outside business if the demands of the outside business would materially interfere with the director’s, officer’s or employee’s responsibilities to the Company; |
| • | take personal advantage or obtain personal gain from an opportunity learned of or discovered during the course and scope of your employment when that opportunity or discovery could be of benefit or interest to the Company; |
| • | have significant financial interest, including direct stock ownership, in any outside business that does or seeks to do a material amount of business with the Company; |
| • | seek or accept any personal loan or services from any such outside business, except from financial institutions or service providers offering similar loans or services to third parties under similar terms in the ordinary course of their respective businesses; |
| • | accept any personal loan or guarantee of obligations from the Company, except to the extent such arrangements are legally permissible; or |
| • | conduct business on behalf of the Company with immediate family members, which include spouses, children, parents, siblings and persons sharing the same home whether or not legal relatives. |
Whether or not a conflict of interest exists or will exist can be unclear. Persons other than directors and executive officers who have questions about a potential conflict of interest or who become aware of an actual or potential conflict should discuss the matter with their supervisor, as applicable, or the GC. Directors and executive officers must consult and seek prior approval of potential conflicts of interest exclusively from the Audit Committee.
For avoidance of doubt, a director affiliated with an investment firm shall not be presumed to have a conflict of interest due to such investment firm or the director acting on its behalf conducting activities in the ordinary course of its business.
| F. | Proper Use of Company Assets |
Directors, officers and employees are entrusted with numerous Company assets and have a responsibility to protect them. The Company’s assets shall be used for their intended business purposes. Personal use of the Company’s funds or property, including charging personal expenses as business expenses, inappropriate reporting or overstatement of business or travel expenses and inappropriate usage of Company equipment or the personal use of supplies or facilities without advance approval from an appropriate officer of the Company shall be considered a breach of the Code.
| G. | Corporate Opportunities |
You owe a duty to the Company to advance its interests when the opportunity to do so arises and are prohibited from taking for yourself opportunities that are discovered through the use of Company property, information or position. You may not use Company property, information or position for personal gain. In addition, you may not compete with the Company. If you become aware of any actual or potential business opportunity that relates to the Company, you may not take advantage of the opportunity or share the opportunity with anyone outside the Company without first receiving the approval of the GC or the Board of Directors, as applicable. Notwithstanding the foregoing, the duties of directors and officers with respect to corporate opportunities are subject to the terms of the Company’s articles of incorporation.
| IV. | LEGAL REQUIREMENTS |
| A. | Regulatory Compliance |
As a biotechnology company focused on developing monoclonal antibody therapies for the preventative treatment of migraines, the Company is in one of the most heavily regulated industries in the world. The Company recognizes this and accordingly supports, acknowledges and is committed to compliance with all applicable laws, rules and regulations governing the pharmaceutical and biotechnology industries, including federal and state anti- kickback and fraud and abuse laws.
This means, among other things, that the Company’s:
| • | research and development procedures must abide by applicable regulatory requirements and be conducted with respect for the research participants involved; |
| • | advertising and promotional efforts, if any, must comply with regulations, including, without limitation, those governing pre-approval promotion and any discussion of off-label uses of our products. Statements and/or claims that we make about our investigational or approved products will be grounded in scientific data and evidence, accepted medical practice, and government-approved labeling rules in all countries where we operate; and |
| • | other activities and functions including without limitation financial, environmental health and safety, and product manufacturing, must comply with applicable regulations. |
| B. | Gifts |
It is against Company policy for a director, officer or employee of the Company to offer anything of value to an existing or potential clinical investigator, Institutional Review Board, patient or other party that would inappropriately influence the design, conduct, enrollment or outcome of clinical studies. Similarly, it is against Company policy for a director, officer or employee to offer anything of value to an existing or potential customer that would inappropriately influence that consumer to select a Company product.
There are similar concerns involving potential conflicts of interest in other external business relationships. Generally, giving or receiving gifts, meals or entertainment involving our external business relationships should meet all of the following criteria:
| • | they do not violate applicable law or fail to comply with Company policy; |
| • | they do not constitute a bribe, kickback or other improper payment; |
| • | they have a valid business purpose; |
| • | they are appropriate as to time, place and value (modest; not lavish or extravagant); |
| • | they are infrequent; and |
| • | they do not influence or appear to influence the behavior of the recipient. |
Gifts of cash or marketable securities may not be given or accepted regardless of amount. If you have any questions regarding the appropriateness of any gift, meal or entertainment, please contact the GC before accepting.
| C. | Dealing with Government Officials |
All dealings with government officials, including, but not limited to, lobbying, political contributions to candidates and meeting with government agencies, shall be in accordance with all applicable national, state and local laws and regulations in each country in which the Company conducts business.
No director, officer or employee shall offer or promise a payment or reward of any kind, directly or indirectly, to any federal, state, local or foreign government official (i) for or because of an official act performed or to be performed by that official; or (ii) in order to secure preferential treatment for the Company or its employees. No director, officer or employee shall offer or promise any federal, state, local or foreign government official gifts, entertainment, gratuities, meals, lodging, travel or similar items that are designed to influence such officials. Further, because of the potential for misunderstanding, no director, officer or employee of the Company may confer gifts, special favors, gratuities or benefits to such an official even if there is no matter pending before that official. The Company also strictly prohibits any director, officer or employee from making any payment or providing a thing of value if the person knows, or reasonably believes or suspects that any portion of the payment or thing of value will be offered, given or promised, directly or indirectly, to any government official.
It is our policy to cooperate fully with all legal and reasonable government investigations. Accordingly, the Company directors, officers and employees shall comply with any and all lawful requests from government investigators and, consistent with preserving the Company’s legal rights, shall cooperate in lawful government inquiries. No director, officer or employee shall make a false or misleading written or oral statement to a government official with regard to any matter involving a government inquiry into the Company matters.
Employees shall contact the GC when presented with any such government request or inquiry prior to responding to such inquiry. Employees with questions about contacts with government officials should seek guidance from senior management. Officers and directors should contact the GC prior to responding to any such inquiries.
| D. | Inside Information |
Inside information is material, non-public information about the Company or another company that, if made public, would be reasonably expected to affect the price of a company’s securities or investment decisions regarding the purchase or sale of such securities. Directors, officers and employees must never use inside information about the Company, another company with which the Company has a preexisting or prospective business relationship, or such company’s securities to obtain any type of personal advantage and should not disclose any such inside information to any third parties without the prior approval of senior management. For further information about the Company’s policy with respect to inside information, please review our Insider Trading Policy and Investment Community Disclosure Policy.
| E. | Company Disclosure Obligations |
The Company’s business affairs are also subject to certain internal and external disclosure obligations and recordkeeping procedures. As a public company, we are committed to abiding by our disclosure obligations in a full, fair, accurate, timely and understandable manner. Only with reliable records and clear disclosure procedures can we make informed and responsible business decisions. When disclosing information to the public, it is Company policy to provide consistent and accurate information. To maintain consistency and accuracy, specific Company spokespersons are designated to respond to questions from the public. Only these individuals are authorized to release information to the public at appropriate times. All inquiries from the media or investors should be forwarded immediately to the GC, Chief Accounting Officer, CEO and/or the Company’s communications or investor relations teams, as applicable. All press releases, speeches, publications or other official Company disclosures must be approved in advance by the Company’s communications team (or the Disclosure Committee, if such communications are within its purview).
We take seriously the reliance our investors place on us to provide accurate and timely information about our business. In support of our disclosure obligations, it is Company policy to always:
| • | comply with generally accepted accounting principles; |
| • | maintain a system of internal accounting and disclosure controls and procedures designed to provide management with reasonable assurances that transactions are properly recorded and that material information is made known to management; |
| • | maintain books and records that accurately and fairly reflect transactions; and |
| • | prohibit establishment of material undisclosed or unrecorded funds or assets. |
| F. | Prohibition Against Discrimination; Equal Opportunity Employment |
The Company is committed to maintaining the highest integrity in our work environment. Our employees must comply with all applicable employment laws and our policies addressing workplace conduct. We base hiring, promotions and performance management decisions on qualifications and job performance. The Company’s policy is to treat each employee and job applicant without regard to gender, sex, race, color, age, religion, national origin, sexual orientation, ancestry, veteran status or any other category protected by law. Employees must refrain from acts that are intended to cause, or that do cause, unlawful employment discrimination. The Company also accommodates qualified disabled employees and applicants consistent with applicable laws.
The Company prohibits harassment in the workplace, including, but not limited to, sexual harassment. Consistent with this policy, we will not tolerate harassment by any of our employees, customers or other third parties. Harassment includes verbal or physical conduct that threatens, offends or belittles any individual because of his or her gender, sex, race, color, age, religion, national origin, sexual orientation, ancestry, veteran status or any other category protected by law. Retaliation against an employee for alleging a complaint of harassment or discrimination or for participating in an investigation relating to such a complaint will also not be tolerated.
| G. | Health and Safety |
The Company is committed to providing a safe and healthy work environment for its employees and all other individuals working on behalf of the Company. The Company also recognizes that the responsibilities for a safe and healthy work environment are shared with you. The Company will continue to establish and implement appropriate health and safety policies that managers and their employees are expected to uphold. Employees are expected to conduct their work in a safe manner in compliance with all the Company policies and to report all safety or health concerns to your manager or Human Resources.
| H. | Foreign Corrupt Practices Act |
All employees must comply with the Foreign Corrupt Practices Act (the “FCPA”), which sets forth requirements for the Company’s relationships with non-U.S. government representatives, which in many countries include individuals who would not be deemed government representatives in the United States (e.g., medical professionals and employees of educational institutions). It is important to note that these limitations apply with respect to a government representative at any level and not only with respect to senior or policy-making roles. As a U.S.-based company, the Company is required to adhere to all standards set forth in the FCPA regardless of the nationality or overseas location of the individual acting on behalf of the Company, whether an employee, officer or third party.
The FCPA requires that relations between U.S. businesses and foreign government representatives conform to the standards that exist in the United States, even if a different business ethic is prevalent in the other country. Accordingly, no employee or third-party person or enterprise acting on behalf of the Company, directly or indirectly, may offer a gift, payment or bribe, or anything else of value, whether directly or indirectly, to any foreign official, foreign political party or party official, or candidate for foreign political office, for the purpose of influencing an official act or decision or seeking influence with a foreign government in order to obtain, retain or direct business to the Company or to any person or to otherwise secure an improper advantage. In short, such activity cannot be used to improve the business environment for the Company in any way. Thus, even if such payment is customary and generally thought to be legal in the host country, it is forbidden by the FCPA and violates U.S. law, unless it is a reasonable and bona fide expenditure, such as entertainment or travel and lodging expenses, that is directly related to (a) the promotion, demonstration or explanation of products or services or (b) the execution or performance of a contract with a foreign government or government agency, and the payment was not made for an improper purpose.
As is the case under U.S. law, even inexpensive gifts to government or political party officials, such as tickets to sporting events, may constitute a violation of the FCPA. If questions arise with respect to expenses to be incurred on behalf of foreign officials, consult with the GC before the Company pays or agrees to pay such expenses.
Some “expediting” payments are authorized under the FCPA. Such payments must be directly related to non-discretionary conduct by lower level bureaucrats and unrelated to efforts by a company to obtain significant concessions, permits or approvals. Examples include processing of visas and work orders, mail delivery or loading and unloading of cargo. Such payments do not include payments of any kind relating to terms of continuing or new business agreements. Consult with the GC prior to making or authorizing any proposed expediting payment.
A violation of the FCPA can result in criminal and civil charges against the Company, its officers, its managers and the individuals involved in the violation, regardless of the person’s nationality or location.
| I. | International Trade Policy |
The Company is committed to maintaining the highest possible ethical standards and complying with all applicable laws in all countries in which it does business. The Company strictly prohibits doing business with countries and persons prohibited by applicable U.S. laws governing international trade, including economic sanctions, export control and anti-boycott laws and regulations (collectively, “International Trade Laws”), as described below:
| • | The United States, through the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”), has imposed robust sanctions measures to cut off funding for terrorists, illegitimate regimes, and others who seek to violate basic human rights. The OFAC sanctions prohibit U.S. persons and businesses from engaging in transactions, directly or indirectly, with certain specified targets, which may include business networks, entities, individuals, geographic regions, or entire nations. OFAC broadly prohibits most transactions between U.S. persons and persons or entities in (or ordinarily resident in) countries and regions that are subject to comprehensive sanctions. |
| • | U.S. export controls are a means by which the United States implements international treaty obligations, such as in the areas of nuclear, chemical and biological weapons proliferation, multilateral sanctions, such as UN arms embargoes and sanctions on companies and individuals, and its own national security and foreign policy interests. In some cases, U.S. export controls prohibit U.S. persons from engaging in activities that support sensitive industries in countries that pose U.S. national security concerns. |
| • | Anti-boycott laws were adopted to encourage and, in specified cases, require U.S. firms to refuse to participate in foreign boycotts that the United States does not sanction. Under the Commerce Department anti-boycott regulations, U.S. persons and their controlled foreign affiliates must report the receipt of boycott requests and are prohibited from agreeing to certain requests. |
To promote compliance with applicable sanctions, the Company is expected to screen proposed counterparties against the restricted party lists set forth by OFAC and other regulators and to avoid doing business with prohibited countries and regions. International Trade Laws are complex restrictions that change from time to time as the result of new legislation, regulations or executive orders. If you have questions about whether International Trade Laws may apply to a particular transaction, please contact the GC.
| V. | AMENDMENTS AND WAIVERS OF THIS CODE |
This Code applies to all Company employees, officers and directors. Please contact the GC if you believe that a waiver under a provision of this Code is warranted. There shall be no substantive amendment or waiver of any provision of this Code except by a vote of the Board of Directors or the Audit Committee of the Board of Directors, which will ascertain whether an amendment or waiver is appropriate and ensure that any amendment or waiver is accompanied by appropriate controls designed to protect the Company. In the case of non-officer employees or consultants of the Company, waivers may also be approved by the CEO. Any such waiver of a provision of this Code shall be evaluated to determine whether timely public disclosure of such waiver is required under the rules and regulations of the Securities and Exchange Commission or applicable exchange listing standards.
The Company reserves the right to amend any provision of this Code at any time, subject to the requirements for approval set forth above.
| VI. | NO RIGHTS CREATED |
This Code is a statement of certain fundamental principles, policies and procedures that govern the Company’s employees, officers and directors in the conduct of the Company’s business. It is not intended to and does not create any rights in any employee, customer, client, visitor, supplier, competitor, shareholder or any other person or entity.
Exhibit 21.1
LIST OF SUBSIDIARIES OF
MENTARI THERAPEUTICS, INC.
| Name of Subsidiary |
Jurisdiction of Incorporation or Organization | |
| Mentari Therapeutics Operating Company LLC |
Delaware | |
| Mentari Securities Corporation |
Massachusetts | |
| InMed Pharmaceuticals Ltd. |
Delaware | |
| BayMedica, LLC |
Delaware | |
| Biogen Sciences Inc. |
British Columbia | |
| Sweetnam Consulting Inc. |
British Columbia | |
Each subsidiary listed above is wholly owned, directly or indirectly, by Mentari Therapeutics, Inc.
Exhibit 99.1
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
Defined terms included below shall have the same meaning as terms defined and included in the Company’s definitive proxy statement/prospectus filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 1, 2026 (the “Proxy Statement/Prospectus”).
On May 19, 2026, Mentari entered into a Merger Agreement, which was subsequently amended on July 6, 2026, with InMed and Indigo Merger Sub Corp and Indigo Merger Sub II, LLC, both wholly owned subsidiaries of InMed, pursuant to which, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Indigo Merger Sub Corp merged with and into Mentari, with Mentari continuing as a wholly owned subsidiary of InMed and the surviving corporation (the “First Merger”). Immediately following the First Merger and as part of the same overall transaction, Mentari merged with and into Indigo Merger Sub II, LLC (the “Second Merger” and, together with the First Merger, the “Merger”), with Indigo Merger Sub II, LLC being the surviving entity of the Second Merger. The closing of the Mentari Pre-Closing Financing, which was subsequently amended on July 22, 2026 to include the First Pre-Closing Financing of gross proceeds of $290.0 million and the Second Pre-Closing Financing of $200.0 million for aggregate gross proceeds of $490.0 million (collectively the “Pre-Closing Financing”), was conditioned on the satisfaction or waiver of the conditions set forth in the Merger Agreement and occurred immediately prior to the closing of the Merger. As such, the pro forma adjustments reflect the Merger and the Mentari Pre-Closing Financing. The Merger closed on November 6, 2026, following the effectiveness of InMed’s registration statement on Form S-4 and receipt of approval by the stockholders of each of Mentari and InMed, in the latter case pursuant to the InMed Special Meeting. In connection with the Merger, Indigo Merger Sub II, LLC changed its corporate name to “Mentari Therapeutics Operating Company LLC” and InMed changed its name to “Mentari Therapeutics, Inc.” InMed following the Merger is referred to herein as the “Combined Company.” The Combined Company is led by Mentari’s management team and remains focused on developing therapies for migraine prevention.
At the Effective Time, upon the terms and subject to the conditions set forth in the Merger Agreement, (i) each then-outstanding share of Mentari common stock (including shares of Mentari common stock issued in connection with the Mentari Pre-Closing Financing) will be automatically converted solely into the right to receive a number of shares of InMed common stock equal to the Exchange Ratio, (ii) each then-outstanding share of Mentari Series Seed preferred stock will be converted into the right to receive a number of shares of newly created InMed Series A non-voting Preferred Stock, which are each convertible into 1,000 shares of InMed common stock, equal to the Exchange Ratio divided by 1,000, (iii) each-then-outstanding share of Mentari Series A preferred stock will be automatically converted into the right to receive to a number of shares of InMed common stock equal to the Exchange Ratio, or a right to receive a pre-funded warrant to purchase Mentari common stock that will be converted into a pre-funded warrant to purchase InMed common stock, subject to adjustment as set forth in the form of the pre-funded warrant, (iv) each then-outstanding option to purchase Mentari common stock will be assumed by InMed and will be converted into an option to purchase shares of InMed common stock, adjusted for the Exchange Ratio, (v) each then-outstanding warrant to purchase Mentari common stock will be assumed by InMed and will be converted into a warrant to purchase shares of InMed common stock, adjusted for the Exchange Ratio, (vi) each then-outstanding share of Mentari restricted stock will be assumed by InMed, subject to adjustment as set forth in the Merger Agreement, (vii) each then-outstanding pre-funded warrant to purchase shares of Mentari common stock will be converted into a pre-funded warrant to purchase shares of InMed common stock, subject to adjustment as set forth in the Merger Agreement and the form of pre-funded warrant, (viii) the vesting of each option to acquire shares of InMed common stock that is issued and outstanding will be accelerated, each in-the-money option will be cancelled and converted into the right to receive a number of shares of InMed common stock underlying such InMed option, and each out-of-the-money option will be cancelled for no consideration.
The Exchange Ratio was 0.20065 shares of InMed common stock for each share of Mentari common stock. Under the Exchange Ratio formula, the former Mentari stockholders immediately before the effective time, including those purchasing shares and pre-funded warrants in the Mentari Pre-Closing Financing, will own approximately 99.0% of the outstanding common stock of the Combined Company, and the stockholders of InMed immediately before the effective time will own approximately 1.0% of the outstanding common stock of the Combined Company, which give effect to (a) Mentari closing the Mentari First Pre-Closing Financing for an aggregate gross purchase price of approximately $290.0 million, which includes $50.0 million of convertible notes purchased in May 2026 prior to the Mentari First Pre-Closing Financing that will convert upon closing of the Merger, (b) a valuation for InMed equal to $5.6 million based on net cash of $(4.4) million at closing, and (c) a valuation for Mentari equal to $125.0 million plus $290.0 million of assumed proceeds in the Mentari First Pre-Closing Financing, in each case as further described in the Merger Agreement.
The following unaudited pro forma condensed combined financial information gives effect to the Merger, which is expected to be accounted for as a reverse recapitalization under U.S. GAAP. For further details related to the accounting for the Merger, please see Notes 1 and 3 below. All share amounts have been adjusted to reflect the estimated Exchange Ratio of 0.20065 shares of InMed common stock for each share of Mentari common stock, which reflects a one-for-ten reverse stock split of InMed common stock immediately prior to the closing of the Merger, unless otherwise stated.
The unaudited pro forma condensed combined balance sheet combines the historical balance sheets of InMed and Mentari as of June 30, 2026 and depicts the accounting of the Merger and Pre-Closing Financing transactions (collectively, the “transaction”) prepared pursuant to Article 11 of Regulation S-X. The unaudited pro forma condensed combined statements of operations for the six months ended June 30, 2026 for InMed and Mentari and for the year ended December 31, 2025 for InMed and Mentari, combine the historical results of InMed and Mentari for those periods and depict the pro forma transaction accounting adjustments assuming that those adjustments were made as of January 1, 2025. Collectively, the pro forma balance sheet transaction accounting adjustments and the pro forma statements of operations transaction accounting adjustments are referred to as the “transaction accounting adjustments” or “pro forma adjustments.”
These unaudited pro forma condensed combined financial information and related notes have been derived from and should be read in conjunction with:
| • | the historical unaudited financial statements of Mentari as of and for the three and six months ended June 30, 2026, and the related notes included elsewhere in the proxy statement/prospectus; |
| • | the historical audited financial statements of InMed for the years ended June 30, 2026 and June 30, 2025, and the related notes included elsewhere in the proxy statement/prospectus; |
| • | the historical audited financial statements of Mentari as of December 31, 2025 and for period from June 13, 2025 (inception) through December 31, 2025, and the related notes included elsewhere in the proxy statement/prospectus; |
| • | the section titled “Mentari’s Management’s Discussion and Analysis of Financial Condition and Results of Operation,” and other financial information relating to Mentari included elsewhere in the proxy statement/prospectus; and |
| • | the section titled “InMed’s Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and other financial information relating to InMed included elsewhere in the proxy statement/prospectus. |
The unaudited pro forma condensed combined financial information is based on the assumptions and pro forma adjustments that are described in the accompanying notes. The pro forma adjustments are preliminary, subject to further revision as additional information becomes available and additional analyses are performed including but not limited to additional financing, additional direct and incremental offering costs and a reverse stock split. Adjustments have been made solely for the purpose of providing unaudited pro forma condensed combined financial information. Differences between these preliminary estimates and the final accounting, expected to be completed after the closing of the Merger, may occur and these differences could have a material impact on the accompanying unaudited pro forma condensed combined financial information.
The unaudited pro forma condensed combined financial information does not give effect to the potential impact of current financial conditions, regulatory matters, operating efficiencies or other savings or expenses that may be associated with the integration of the two companies. The unaudited pro forma condensed combined financial information is not necessarily indicative of the financial position or results of operations in the future periods or the result that actually would have been realized had InMed and Mentari been a combined organization during the specified periods. The actual results reported in periods following the Merger may differ significantly from those reflected in the unaudited condensed combined pro forma financial information presented herein for a number of reasons, including, but not limited to, differences in the assumptions used to prepare this unaudited pro forma condensed combined financial information.
UNAUDITED PRO FORMA CONDENSED COMBINED
BALANCE SHEET AS OF JUNE 30, 2026
(In thousands)
| Historical | ||||||||||||||||||
| 5(A) InMed Pharmaceuticals Inc. |
5(B) Mentari Therapeutics Inc. |
Transaction Accounting Adjustments |
Notes | Pro Forma Combined |
||||||||||||||
| Assets |
||||||||||||||||||
| Current assets: |
||||||||||||||||||
| Cash and cash equivalents |
$ | 2,195 | $ | 65,231 | $ | (2,058 | ) | 5(a) | $ | 478,116 | ||||||||
| 439,316 | 5(c) | |||||||||||||||||
| (22,351 | ) | 5(d) | ||||||||||||||||
| (2,414 | ) | 5(e) | ||||||||||||||||
| (1,843 | ) | 5(h) | ||||||||||||||||
| 40 | 5(j) | |||||||||||||||||
| Short-term investments |
40 | — | (40 | ) | 5(j) | |||||||||||||
| Prepaid expenses and other current assets |
241 | 527 | (241 | ) | 5(f) | 527 | ||||||||||||
| Held for sale property and equipment |
20 | — | (20 | ) | 5(k) | — | ||||||||||||
| Current assets of discontinued operations |
181 | — | (181 | ) | 5(l) | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total current assets |
2,677 | 65,758 | 410,208 | 478,643 | ||||||||||||||
| Property, equipment and ROU assets, net |
221 | — | (221 | ) | 5(g) | — | ||||||||||||
| Other assets |
132 | 1,649 | (1,649 | ) | 5(d) | 132 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total assets |
$ | 3,030 | $ | 67,407 | $ | 408,338 | $ | 478,775 | ||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Liabilities, Convertible Preferred Stock and Stockholders’ Equity (Deficit) |
||||||||||||||||||
| Current liabilities: |
||||||||||||||||||
| Accounts payable and accrued liabilities |
$ | 1,843 | $ | 11,102 | $ | (1,843 | ) | 5(h) | $ | 11,102 | ||||||||
| Current liabilities of discontinued operations |
112 | — | (112 | ) | 5(l) | — | ||||||||||||
| Related party common stock warrant liability |
— | 320 | — | 320 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total current liabilities |
1,955 | 11,422 | (1,955 | ) | 11,422 | |||||||||||||
| Long Term liabilities: |
||||||||||||||||||
| Accrued Interest Payable, related party |
— | 707 | (707 | ) | 5(c) | — | ||||||||||||
| Note Payable to related party, noncurrent |
— | 49,977 | (49,977 | ) | 5(c) | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liabilities |
1,955 | 62,106 | (52,639 | ) | 11,422 | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Mentari Series Seed convertible preferred stock |
— | 200 | (200 | ) | 5(b) | — | ||||||||||||
| Mentari Series A convertible preferred stock |
— | 54,880 | (54,880 | ) | 5(b) | — | ||||||||||||
| InMed Series A non-voting convertible preferred stock |
— | — | 200 | 5(b) | 200 | |||||||||||||
| Stockholders’ equity (deficit) |
||||||||||||||||||
| InMed common stock |
94,283 | — | (94,283 | ) | 5(m) | — | ||||||||||||
| Mentari common stock |
— | — | 1 | 5(b) | 5 | |||||||||||||
| 4 | 5(c) | |||||||||||||||||
| Additional paid-in capital |
36,894 | 408 | 54,879 | 5(b) | 517,335 | |||||||||||||
| 439,312 | 5(c) | |||||||||||||||||
| 50,684 | 5(c) | |||||||||||||||||
| (24,000 | ) | 5(d) | ||||||||||||||||
| 68 | 5(i) | |||||||||||||||||
| (40,910 | ) | 5(m) | ||||||||||||||||
| Accumulated deficit |
(130,230 | ) | (50,187 | ) | (2,058 | ) | 5(a) | (50,187 | ) | |||||||||
| (2,414 | ) | 5(e) | ||||||||||||||||
| (241 | ) | 5(f) | ||||||||||||||||
| (221 | ) | 5(g) | ||||||||||||||||
| (68 | ) | 5(i) | ||||||||||||||||
| (20 | ) | 5(k) | ||||||||||||||||
| 135,321 | 5(m) | |||||||||||||||||
| (69 | ) | 5(l) | ||||||||||||||||
| Accumulated other comprehensive income |
128 | — | (128 | ) | 5(m) | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total stockholders’ equity (deficit) |
1,075 | (49,779 | ) | 515,857 | 467,153 | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||
| Total liabilities, convertible preferred stock and stockholders’ equity (deficit) |
$ | 3,030 | $ | 67,407 | $ | 408,338 | $ | 478,775 | ||||||||||
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF
OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2026
(In thousands, except share and per share amounts)
| Historical | ||||||||||||||||||||||||
| 6(A) InMed Pharmaceuticals Inc. |
6(B) Mentari Therapeutics Inc. |
Transaction Accounting Adjustments |
Note | Pro Forma Combined |
Note | |||||||||||||||||||
| Operating expenses: |
||||||||||||||||||||||||
| Research and development |
$ | 1,828 | $ | 29,267 | $ | — | $ | 31,095 | ||||||||||||||||
| General and administrative |
4,100 | 1,533 | (290 | ) | 6 | (c) | 5,343 | |||||||||||||||||
| Amortization and depreciation |
100 | — | (80 | ) | 6 | (c) | — | |||||||||||||||||
| (20 | ) | 6 | (d) | |||||||||||||||||||||
| Loss on disposal of property, plant and equipment |
7 | — | — | 7 | ||||||||||||||||||||
| Impairment of property, plant and equipment |
189 | — | — | 189 | ||||||||||||||||||||
| Impairment of intangible assets |
1,458 | — | — | 1,458 | ||||||||||||||||||||
| Foreign exchange loss |
19 | — | — | 19 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total operating expenses |
7,701 | 30,800 | (390 | ) | 38,111 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Loss from operations |
(7,701 | ) | (30,800 | ) | 390 | (38,111 | ) | |||||||||||||||||
| Other income (expense), net: |
||||||||||||||||||||||||
| Interest income |
77 | 754 | — | 831 | ||||||||||||||||||||
| Interest expense |
(11 | ) | (708 | ) | 708 | 6 | (e) | (11 | ) | |||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total other income (expense), net |
66 | 46 | 708 | 820 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Net loss from continuing operations |
$ | (7,635 | ) | $ | (30,754 | ) | $ | 1,098 | $ | (37,291 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted |
4,376,111 | 5,000,000 | 54,099,088 | 6 | (f) | |||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted |
— | — | 4,013 | 6 | (f) | |||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Net loss per share attributable to common stockholders, basic and diluted |
$ | (1.74 | ) | $ | (6.15 | ) | $ | (0.64 | ) | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted |
$ | — | $ | — | $ | (641.66 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF
OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2025
(In thousands, except share and per share amounts)
| Historical | ||||||||||||||||||||||||
| 6(C) InMed Pharmaceuticals Inc. |
6(D) Mentari Therapeutics Inc. |
Transaction Accounting Adjustments |
Note | Pro Forma Combined |
Note | |||||||||||||||||||
| Operating expenses: |
||||||||||||||||||||||||
| Research and development |
2,439 | 18,905 | 22 | 6 | (b) | 21,366 | ||||||||||||||||||
| General and administrative |
5,309 | 947 | 241 | 6 | (a) | 6,131 | ||||||||||||||||||
| 46 | 6 | (b) | ||||||||||||||||||||||
| (412 | ) | 6 | (c) | |||||||||||||||||||||
| Amortization and depreciation |
208 | — | (46 | ) | 6 | (c) | — | |||||||||||||||||
| (162 | ) | 6 | (d) | |||||||||||||||||||||
| Foreign exchange loss |
39 | — | — | 39 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total operating expenses |
7,995 | 19,852 | (311 | ) | 27,536 | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Loss from operations |
(7,995 | ) | (19,852 | ) | 311 | (27,536 | ) | |||||||||||||||||
| Other income: |
||||||||||||||||||||||||
| Interest income |
216 | 419 | — | 635 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Total other income |
216 | 419 | — | 635 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Net loss from continuing operations |
$ | (7,779 | ) | $ | (19,433 | ) | $ | 311 | $ | (26,901 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted |
2,636,268 | 5,000,000 | 53,925,104 | 6 | (f) | |||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Weighted-average shares used in computing net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted |
— | — | 4,013 | 6 | (f) | |||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Net loss per share attributable to common stockholders, basic and diluted |
$ | (2.95 | ) | $ | (3.89 | ) | $ | (0.46 | ) | |||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
| Net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted |
$ | — | $ | — | $ | (464.30 | ) | |||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
1. Description of the Merger
On May 19, 2026, Mentari entered into the Merger Agreement with InMed, Indigo Merger Sub Corp and Indigo Merger Sub II, LLC, which was subsequently amended on July 6, 2026, pursuant to which, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Indigo Merger Sub Corp merged with and into Mentari, with Mentari surviving as a wholly owned subsidiary of InMed and the surviving corporation of the First Merger, and, immediately following the First Merger and as part of the same overall transaction, Mentari merged with and into Indigo Merger Sub II, LLC, with Indigo Merger Sub II, LLC being the surviving entity of the Second Merger. The Merger, including the Mentari Pre-Closing Financing, which was subsequently amended on July 22, 2026, closed on November 6, 2026 following the effectiveness of InMed’s registration statement on Form S-4 and receipt of approval by the stockholders of each of Mentari and InMed, in the latter case pursuant to the InMed Special Meeting. In connection with the Merger, Indigo Merger Sub II, LLC changed its corporate name to “Mentari Therapeutics Operating Company LLC” and InMed changed its name to “Mentari Therapeutics, Inc.” InMed following the Merger is referred to herein as the “Combined Company.” Subject to the terms and conditions of the Merger Agreement, at closing of the Merger:
| a) | each then-outstanding share of Mentari common stock (including shares of Mentari common stock issued in connection with the Mentari Pre-Closing Financing) will be converted into the right to receive a number of shares of InMed common stock equal to the Exchange Ratio; |
| b) | each then-outstanding share of Mentari Series Seed preferred stock will be converted into the right to receive a number of shares of newly created InMed Series A non-voting preferred stock, which are each convertible into 1,000 shares of InMed common stock, equal to the Exchange Ratio divided by 1,000; |
| c) | each-then-outstanding share of Mentari Series A preferred stock will be automatically converted into the right to receive to a number of shares of InMed common stock equal to the Exchange Ratio, or a right to receive a pre-funded warrant to purchase Mentari common stock that will be converted into a pre-funded warrant to purchase InMed common stock, subject to adjustment as set forth in the form of the pre-funded warrant; |
| d) | each then-outstanding option to purchase Mentari common stock will be assumed by InMed and will be converted into an option to purchase shares of InMed common stock, adjusted for the Exchange Ratio; |
| e) | each then-outstanding warrant to purchase shares of Mentari common stock will be converted into a warrant to purchase shares of InMed common stock, adjusted for the Exchange Ratio; |
| f) | each then-outstanding share of Mentari restricted stock will be assumed by InMed, adjusted for the Exchange Ratio; and |
| g) | each then-outstanding pre-funded warrant to purchase shares of Mentari common stock will be converted into a pre-funded warrant to purchase shares of InMed common stock, subject to adjustment as set forth in the form of pre-funded warrant. |
All outstanding and unvested Mentari restricted stock immediately prior to Closing (“Mentari Restricted Stock”) that are assumed by InMed in the Merger will be converted into restricted stock with respect to shares of InMed common stock based on the Exchange Ratio and will otherwise remain subject to substantially the same vesting and other terms and conditions applicable immediately prior to the Merger.
Under the terms of InMed’s equity incentive plan, the Merger triggers vesting acceleration for certain outstanding awards pursuant to pre-existing contractual provisions. The Company evaluated the accounting for these awards under ASC 718 and recognized compensation expense associated with the acceleration of vesting as an adjustment to the unaudited pro forma condensed combined financial information.
Each option to acquire shares of InMed common stock with an exercise price less than or equal to the InMed Closing Price will be surrendered by the holder thereof to InMed for cancellation, and the holder thereof will be entitled to receive a number of shares of InMed common stock underlying such InMed option, and each option with an exercise price greater than the InMed Closing Price to acquire shares of InMed common stock will be cancelled for no consideration.
Immediately following the Merger, InMed securityholders as of immediately prior to the Merger will own approximately 1.0% of the outstanding capital stock of the Combined Company on a fully diluted basis, former Mentari securityholders, excluding shares purchased in the Mentari Pre-Closing Financing, will own approximately 25.7% of the outstanding capital stock of the Combined Company on a fully diluted basis, and shares and pre-funded warrants issued in the Mentari Pre-Closing Financing will own approximately 73.4% of the outstanding capital stock of the Combined Company on a fully diluted basis. Upon consummation of the Merger and related Mentari Pre-Closing Financing, Fairmount, Paragon and Paratari will own approximately 26.4%, 0.8%, and 1.0%, respectively, of the Combined Company’s outstanding capital stock on a fully diluted basis.
Mentari stockholders are expected to receive approximately 60,229,371 shares on a fully diluted basis in connection with the Merger, including (i) 2,423,701 shares underlying outstanding Mentari options and unvested Mentari restricted stock immediately prior to the Merger, which will be assumed by InMed and remain subject to substantially the same vesting conditions following the Merger, (ii) the shares of common stock and pre-funded warrants issued in the Mentari Pre-Closing Financing, (iii) Mentari Series Seed non-voting preferred stock as of June 30, 2026, which will be exchanged into shares of newly created InMed Series A non-voting Preferred Stock, which will be convertible into 1,000 shares of InMed common stock, equal to the Exchange Ratio divided by 1,000, and (iv) Mentari Series A preferred stock outstanding as of June 30, 2026, which will be convertible into shares of InMed common stock, or the right to receive a pre-funded warrant to purchase Mentari common stock that will be converted into a pre-funded warrant to purchase shares of InMed common stock, subject to adjustment set forth the form of the pre-funded warrant. These estimates are subject to certain inputs, which include, but are not limited to, (a) Mentari closing the Mentari First Pre-Closing Financing for an aggregate purchase price of approximately $290.0 million, which includes $50.0 million of convertible notes purchased in May 2026 prior to the Mentari Pre-Closing Financing that will convert upon closing of the Merger, (b) a valuation for InMed equal to $5.6 million based on net cash of $(4.4) million at closing, and (c) a valuation for Mentari equal to $125.0 million plus $290.0 million of assumed proceeds in the Mentari First Pre-Closing Financing, in each case as further described in the Merger Agreement. The pro forma capitalization information also gives effect to the Mentari Second Pre-Closing Financing for aggregate gross proceeds of approximately $200.0 million. After giving effect to the Mentari Second Pre-Closing Financing, the outstanding capital stock of the Combined Company on a fully diluted basis is expected to increase from approximately 46,947,016 shares to approximately 60,821,927 shares. The following table summarizes the pro forma number of shares of common stock of the Combined Company outstanding following the consummation of the transactions:
| Pro Forma (Assuming InMed’s Net Cash at Closing of $(4.4) million) |
||||||||
| Equity Capitalization Summary (fully diluted basis) Upon Consummation
of |
Number of Shares Owned | % Ownership |
||||||
| Mentari stockholders |
15,612,935 | 25.7 | % | |||||
| InMed stockholders |
592,556 | 1.0 | % | |||||
| Investors participating in the Subscription Agreement(1) |
44,616,436 | 73.4 | % | |||||
|
|
|
|
|
|||||
| Total common stock of the combined company |
60,821,927 | 100.0 | % | |||||
|
|
|
|
|
|||||
| (1) | Includes 1,468,222 pre-funded warrants issued in the Mentari Pre-Closing Financing after reflecting the estimated Exchange Ratio. |
Consummation of the Merger is subject to certain closing conditions, including, among other things, (1) approval by InMed stockholders, (2) approval by the Company’s stockholders, (3) Nasdaq’s approval of the listing application to be submitted in connection with the Merger, (4) the effectiveness of InMed’s registration statement on Form S-4, and (5) the consummation of the Mentari Pre-Closing Financing.
The employment agreements for InMed’s employees include entitlement to a transaction bonus and severance of which will be treated as pre-Merger compensation expense of InMed, which will be assumed by the Combined Company at the closing of the Merger to the extent they are not yet settled in cash beforehand by InMed. Additionally, InMed’s current Directors & Officers (“D&O”) policy will be fully utilized at the closing of the Merger.
Private Financing Transaction — Subscription Agreement
In connection with the Merger, on May 19, 2026, Mentari and InMed entered into the Subscription Agreement with certain institutional investors pursuant to which such investors agreed to purchase, immediately prior to the consummation of the Merger, in the Mentari First Pre-Closing Financing, 147,334,291 shares of Mentari common stock and 5,875,395 pre-funded warrants before giving effect to the Exchange Ratio, at a purchase price of $1.8928 per share and $1.8927 per warrant, respectively, for aggregate gross proceeds of $290.0 million, which includes $50.0 million of convertible notes purchased in May 2026 prior to the Mentari First Pre-Closing Financing. In addition, pursuant to the Mentari Second Pre-Closing Financing, investors agreed to purchase, immediately prior to the consummation of the Merger, 67,707,887 shares of Mentari common stock and 1,441,933 pre-funded warrants before giving effect to the Exchange Ratio, at a purchase price of $2.8923 per share and $2.8922 per warrant, for aggregate gross proceeds of approximately $200.0 million. The closing of the Mentari Pre-Closing Financing was conditioned on the satisfaction or waiver of the conditions set forth in the Merger Agreement and occurred immediately prior to the closing of the Merger.
Contingent Value Rights Agreement
At or prior to the Effective Time of the Merger, InMed entered into a Contingent Value Rights Agreement (“CVR Agreement”) whereby which InMed’s pre-Merger shareholders received one contingent value right (each a “CVR”) for each outstanding share of InMed common stock held by such shareholder as of the close of business on November 5, 2026. Each CVR represents the contractual right to receive certain net proceeds, if any, derived from cash consideration actually received by InMed as a result of the disposition of InMed’s pre-Merger legacy assets, net of any indemnity obligations, transaction costs and certain other expenses, during the period beginning on the date of the closing of the Merger and ending with respect to the sale, transfer, license or other disposition of all pre-Merger legacy assets.
The Company evaluated the Legacy Asset CVR under ASC 815 and concluded that, although the arrangement meets the definition of a derivative instrument, it qualifies for the nonfinancial asset scope exception in ASC 815-10-15-59(b) because it represents a contractual right to participate in the future monetization of unique nonfinancial assets that are not readily convertible to cash. Accordingly, the Legacy Asset CVR is excluded from the scope of ASC 815 and is not accounted for as a derivative liability. Subsequent amounts paid to CVR holders, if any, will be recognized as distributions to legacy holders when such amounts become payable. The InMed legacy assets subject to the CVR arrangement consist primarily of the Company’s historical cannabinoid-based product candidates, including INM-901, INM-089 and INM-755, together with related intellectual property and associated assets. Historically, InMed incurred research and development expenses associated with its cannabinoid-based product candidates, including INM-901, INM-089 and INM-755. Following the close of the Merger, the Combined Company expects that substantially all future research and development activities and expenditures will relate to Mentari’s product candidates. The Combined Company does not currently anticipate continuing material development activities related to InMed’s legacy programs and instead expects to pursue strategic alternatives for those assets through the CVR structure. Accordingly, historical InMed research and development expenses may not be indicative of the future operating results of the Combined Company.
| 2. | Basis of Presentation |
The unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X. The adjustments presented in the unaudited pro forma condensed combined financial information have been identified and presented to provide relevant information necessary for an understanding of the Combined Company upon consummation of the Merger. The unaudited pro forma condensed combined statement of operations data for the six months ended June 30, 2026 and the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2025, give effect to the Merger as if it had been consummated on January 1, 2025. The unaudited pro forma condensed combined balance sheet as of June 30, 2026 gives effect to the Merger and combines the historical balance sheets of InMed and Mentari as if the Merger had been consummated on June 30, 2026. Prior to the consummation of the Merger, InMed effected a one-for-ten reverse stock split of InMed’s common stock, which became effective on November 4, 2026, which is reflected in the Exchange Ratio of 0.20065.
The unaudited pro forma condensed combined financial information is based on the assumptions and adjustments that are described in the accompanying notes. Differences between these preliminary accounting conclusions and estimates and the final accounting conclusions and amounts may occur as a result of, among other reasons: (i) changes in initial assumptions in the determination of the accounting acquirer and related accounting, (ii) changes in the amount of InMed net cash to be assumed at the closing date, and (iii) other changes in InMed’s assets and liabilities, which are expected to be completed after the closing of the Merger, and these differences could have a material impact on the accompanying unaudited pro forma condensed combined financial information and the Combined Company’s future results of operations and financial position.
During the preparation of the accompanying unaudited pro forma combined financial information, Management is not aware of any material differences between Mentari’s accounting policies and the accounting policies of InMed. Following the consummation of the Merger, Mentari will conduct a more detailed review of InMed’s accounting policies. As a result, Mentari may identify differences between the accounting policies of the two companies that, when conformed, could have had a material impact on the accompanying unaudited pro forma combined financial information.
| 3. | Accounting for the Merger |
The unaudited pro forma condensed combined financial information gives effect to the Merger, which is expected to be accounted for under U.S. GAAP as a reverse recapitalization of InMed by Mentari, as the transaction is, in essence, the issuance of equity by Mentari for InMed’s net assets, which will primarily consist of nominal operations and nominal other net assets immediately before the Merger. Following the close of the Merger, the Combined Company does not intend to devote material resources to advancing InMed’s historical product candidates and instead intends to focus substantially all operational and financial resources on Mentari’s migraine prevention programs. Existing InMed programs are expected to be pursued only to the extent they can be monetized, partnered, licensed or otherwise disposed of through the CVR structure. Under this method of accounting, Mentari will be considered the accounting acquirer for financial reporting purposes. This determination is based on the expectations that, immediately following the Merger:
| • | Immediately prior to the Merger, Mentari is not a variable interest entity as it has sufficient equity at risk in order to fund its next development milestones; |
| • | Mentari stockholders own a substantial majority of the voting rights in the Combined Company through existing ownership and additional interest through the Subscription Agreement; |
| • | Mentari’s largest stockholder retains the largest interest in the Combined Company (26.4%); |
| • | Mentari designated the initial members of the Combined Company board of directors; |
| • | Mentari’s executive management team will become the management of the Combined Company; and |
| • | The Combined Company will be renamed “Mentari Therapeutics, Inc.” |
As a result of Mentari being the accounting acquirer, Mentari’s assets and liabilities will be recorded at their pre-combination carrying amounts. InMed’s assets and liabilities will be measured and recognized at their fair values as of the effective time of the Merger. The Company will continue to assess observable and unobservable data points to consider fair value estimates through closing of the transaction. The Company expects that the carrying value of the other acquired operating assets and liabilities approximates fair value, with no goodwill or other intangible assets recorded. Any difference between the consideration transferred and the fair value of the net assets of InMed following the determination of the actual consideration transferred for InMed will be reflected as an adjustment to additional paid-in capital. For periods prior to closing of the Merger, the historical financial statements of Mentari will become the historical financial statements of the Combined Company. The Merger will not be accounted for as a business combination under Accounting Standard Codification No. 805, Business Combinations.
| 4. | Shares of InMed Common Stock, Convertible Preferred Stock, Options, and Warrants Issued to Mentari Stockholders upon Closing of the Merger |
At the closing of the Merger, all outstanding shares of Mentari common stock, on a fully-diluted basis, will be exchanged for shares of InMed common stock based on the Exchange Ratio of 0.20065 shares of InMed common stock for each share of Mentari common stock, determined in accordance with the terms of the Merger Agreement. Each share of Mentari Series Seed preferred stock will be convertible into the right to receive a number of shares of newly created InMed Series A non-voting Preferred Stock, equal to the Exchange Ratio divided by 1,000 (and each such share of newly created InMed Series A non-voting Preferred Stock has the right to convert into 1,000 shares of InMed common stock, subject to certain limitations). The estimated number of shares of InMed common stock that InMed expects to issue to Mentari’s stockholders assumes InMed net cash at the closing of the Merger is $(4.4) million and is determined as follows:
| Shares of Mentari common stock outstanding as of June 30, 2026(1) |
5,305,556 | |||
| Shares of Mentari convertible preferred stock to be issued in exchange of Mentari non-voting convertible preferred stock |
20,000,000 | |||
| Shares of Mentari convertible preferred stock to be issued in exchange of Mentari common stock |
40,078,698 | |||
| Shares of Mentari common stock to be issued upon exercise of Mentari stock options(2) |
11,773,692 | |||
| Shares of Mentari common stock to be issued upon exercise of Mentari warrants(3) |
653,842 | |||
| Estimated shares of Mentari common stock to be issued in connection with the Subscription Agreement, see Note 5(c) |
215,042,178 | |||
| Estimated Mentari pre-funded warrants to be issued in connection with the Subscription Agreement, see Note 5(c) |
7,317,328 | |||
|
|
|
|||
| Total Mentari fully diluted shares prior to the closing of the merger |
300,171,294 | |||
| Estimated Exchange Ratio |
0.20065 | |||
|
|
|
|||
| Estimated fully diluted shares to be issued to Mentari stockholders and Investors participating in Subscription Agreement upon closing of the merger |
60,229,371 | |||
|
|
|
| (1) | Represents shares of Mentari common stock outstanding as of June 30, 2026, including 305,556 shares of unvested Mentari restricted stock. |
| (2) | Represents the outstanding options as of June 30, 2026 to acquire Mentari common stock. |
| (3) | Represents the outstanding warrants as of June 30, 2026 to acquire Mentari common stock. |
| 5. | Adjustments to Unaudited Pro Forma Condensed Combined Balance Sheet as of June 30, 2026 |
The pro forma notes and adjustments, based on preliminary estimates that could change materially as additional information is obtained, are as follows:
Pro forma notes:
5(A) Derived from the audited balance sheet of InMed as of June 30, 2026 included elsewhere in the proxy statement/prospectus.
5(B) Derived from the unaudited balance sheet of Mentari as of June 30, 2026 included elsewhere in the proxy statement/prospectus.
Pro forma Balance Sheet Transaction Accounting Adjustments:
5(a) To reflect incremental compensation expense of $2.1 million related to severance and retention payments resulting from pre-existing employment agreements or from approval from the InMed Board that will be incurred prior to the closing of the Merger. The pro forma adjustment is reflected as a decrease in cash of $2.1 million for the severance payments as if the transaction occurred on June 30, 2026 and an increase to accumulated deficit of $2.1 million.
5(b) To reflect the conversion of all outstanding shares of Mentari Series A preferred stock, with a carrying amount of $54.9 million, to InMed common stock and pre-funded warrants, as well as to reflect the reclassification of all outstanding Mentari Series Seed preferred stock, with a carrying value of $0.2 million, to newly created InMed Series A preferred stock outside of stockholder’s equity (deficit). The Company’s Series A Non-Voting Convertible Preferred Stock are classified within temporary (mezzanine) equity under ASC 480 and ASC 480-10-S99. Although the Series A Preferred Stock is not mandatorily redeemable, certain provisions may require the Company to transfer cash or other assets upon the occurrence of events not solely within the Company’s control. For example, the Series A Preferred Stock includes fundamental transaction provisions pursuant to which, upon the occurrence of certain merger, change-in-control, or other similar transactions, holders may receive cash or other non-equity consideration in lieu of common shares. The occurrence of such transactions is not solely within the control of the Company and may involve shareholder approval. The conversion of the Mentari Series A preferred stock is recorded at the issuance of InMed common stock at par value with the remaining amount recorded to additional paid-in capital.
5(c) To reflect the issuance of 43,148,213 shares of Mentari common stock and 1,468,222 pre-funded warrants, after giving effect to the Exchange Ratio, pursuant to the Subscription Agreement, which was subsequently amended on July 22, 2026, for an aggregate purchase price of $490.0 million, which includes $50.0 million of gross proceeds from the issuance of Convertible Notes in May 2026. Upon closing of the Merger, the outstanding principal and accrued interest on the Convertible Notes will convert into shares of Mentari common stock. Accordingly, the pro forma adjustment reflects the conversion of the Convertible Notes into Mentari common stock and the related elimination of the outstanding Convertible Notes and accrued interest payable. The issuance of shares and pre-funded warrants in connection with the Subscription Agreement and additional pre-closing financing is recorded as the issuance of Mentari common stock at par value with the remaining amount recorded to additional paid-in capital.
The net cash proceeds received prior to direct and incremental transaction costs from the Subscription Agreement and corresponding adjustment to additional paid-in-capital upon close of the Merger is determined as follows (in thousands):
| Aggregate purchase price of Purchase Agreement |
$ | 490,000 | ||
| Net proceeds previously received from issuance of convertible note as of June 30, 2026 |
(49,977 | ) | ||
| Accrued interest payable as part of issuance of convertible note as of June 30, 2026 see Note 6(d) |
(707 | ) | ||
|
|
|
|||
| Net proceeds received prior to direct and incremental transaction costs from the Purchase Agreement upon close of the Merger |
$ | 439,316 | ||
|
|
|
|||
| Net proceeds received prior to direct and incremental transaction costs from the Purchase Agreement upon close of the Merger |
$ | 439,316 | ||
| Issuance of Mentari common stock at par value upon close of the Merger |
(4 | ) | ||
|
|
|
|||
| Additional paid-in capital related to the issuance of Mentari common stock and pre-funded warrants upon close of the Merger (excluding Mentari common stock issued in connection with conversion of convertible note) |
$ | 439,312 | ||
|
|
|
5(d) To reflect estimated transaction costs of $22.4 million, not yet reflected in the historical financial statements, that are expected to be incurred by Mentari in connection with the Merger and Pre-Closing Financing, and $1.6 million reflected in the historical financial statements as deferred offering costs, such as advisory, legal and auditor fees, as a reduction in cash and a reduction in other assets in the unaudited pro forma condensed combined balance sheet. As the Merger will be accounted for as a reverse recapitalization equivalent to the issuance of equity for the net assets of InMed, these direct and incremental costs are treated as a reduction of the net proceeds received within additional paid-in capital.
5(e) To reflect estimated transaction costs of $2.4 million, not yet reflected in the historical financial statements, which are expected to be incurred by InMed in connection with the Merger, such as advisory, legal and auditor fees and including the estimated $0.1 million cost of a D&O tail policy, as a reduction in cash and an increase in accumulated deficit of $2.4 million in the unaudited pro forma condensed combined balance sheet.
5(f) To derecognize $0.2 million of InMed’s prepaid expenses and other current assets consisting of prepaid insurance primarily related to the current InMed’s D&O insurance policy that will be fully utilized at the closing of the Merger.
5(g) To derecognize property and equipment expected to have de minimis fair value at closing, resulting in a pro forma adjustment of $0.2 million.
5(h) To derecognize $1.8 million of InMed’s accounts payable and accrued expenses consisting of accrued research and development and accrued professional and consulting fees that will be paid prior to the closing of the Merger.
5(i) To reflect the one-time stock compensation expense of less than $0.1 million related to the acceleration of unvested stock options pursuant to pre-existing grant agreements, which provide for such acceleration upon a change in control provision, which will be triggered by the Merger.
5(j) To reflect the liquidation of InMed’s short-term investments of less than $0.1 million into cash prior to the closing of the Merger.
5(k) To derecognize InMed’s held-for-sale property and equipment that is expected to be sold or otherwise disposed of prior to the closing of the Merger, resulting in a pro forma adjustment of less than $0.1 million.
5(l) To reflect the derecognition of InMed discontinued operations balances that are not expected to transfer to the Combined Company upon consummation of the Merger, resulting in a pro forma adjustment of less than $0.1 million.
5(m) To reflect the recapitalization of Mentari and the derecognition of InMed’s equity balances, including accumulated other comprehensive income and accumulated deficit, which are reversed to additional paid-in capital.
The derecognition of accumulated deficit of InMed of $135.3 million is determined as follows (in thousands):
| Accumulated deficit of InMed as of June 30, 2026 |
$ | 130,230 | ||
| Compensation expense related to InMed severance payments, see Note 5(a) |
2,058 | |||
| Preliminary estimated transaction costs of InMed, see Note 5(e) |
2,414 | |||
| Derecognition of InMed prepaid expenses, see Note 5(f) |
241 | |||
| Derecognition of InMed property and equipment and operating leases, see Note 5(g) |
221 | |||
| Pre-merger stock-based compensation expense for InMed’s cancelled and accelerated awards, see Note 5(i) |
68 | |||
| Derecognition of InMed held for sale equipment, see Note 5(k) |
20 | |||
| Derecognition of InMed discontinued operations balances, see Note 5(l) |
69 | |||
|
|
|
|||
| Total adjustment to derecognize the accumulated deficit of InMed |
$ | 135,321 | ||
|
|
|
| 6. | Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations and Comprehensive Loss |
The pro forma notes and adjustments, based on preliminary estimates that could change materially as additional information is obtained, are as follows:
Pro forma notes:
6(A) Derived from InMed’s unaudited condensed consolidated statement of operations for the six months ended June 30, 2026. The statement of operations for InMed for the six months ended June 30, 2026 was derived by combining (i) the audited fiscal year June 30, 2026 and (ii) less the unaudited six months ended December 31, 2025.
6(B) Derived from the unaudited condensed consolidated statement of operations and comprehensive loss of Mentari for the six months ended June 30, 2026 included elsewhere in the proxy statement/prospectus.
6(C) Derived from the unaudited condensed consolidated statement of operations of InMed for the year ended December 31, 2025. The statement of operations for InMed for the year ended December 31, 2025 was derived by combining (i) the audited fiscal year ended June 30, 2025 and (ii) the unaudited six months ended December 31, 2025, less the unaudited six months ended December 31, 2024.
6(D) Derived from the audited consolidated statement of operations and comprehensive loss of Mentari for the period from June 13, 2025 (inception) to December 31, 2025 included elsewhere in the proxy statement/prospectus.
Mentari and InMed did not record any provision or benefit for income taxes during the year ended December 31, 2025 nor for the six months ended June 30, 2026 because each company incurred a pre-tax loss in 2025 and expects to incur a pre-tax loss in 2026 and each company maintained a full valuation allowance on its deferred tax assets. Accordingly, the Company has not reflected any income tax effects related to the pro forma adjustments as it continues to expect a full valuation allowance will be required following the transaction.
Pro forma Statements of Operations Transaction Accounting Adjustments:
6(a) To reflect the derecognition of InMed’s prepaid expenses and other current assets of $0.2 million related to prepaid insurance primarily related to the current InMed D&O policy that will be fully utilized at the closing of the Merger, corresponding to the adjustment made in Note 5(f) as if it was made on January 1, 2025.
6(b) To reflect the one-time stock compensation expense of less than $0.1 million in general and administrative expense and less than $0.1 million in research and development expense for the acceleration of unvested stock options pursuant to pre-existing grant agreements which provide for such acceleration upon a change in control provision, which will be triggered by the Merger, corresponding to the adjustment made in Note 5(i) as if it was made on January 1, 2025.
6(c) To reflect the impact of the derecognition of InMed’s operating leases expected to be terminated prior to the closing of the Merger and property and equipment expected to have de minimis fair value as of the closing of the Merger, assuming the adjustment described in Note 5(g) was made on January 1, 2025. As a result, the unaudited pro forma condensed combined statement of operations reflects the elimination of lease expense of approximately $0.4 million and depreciation expense of less than $0.1 million for the year ended December 31, 2025, and the elimination of related lease expense of $0.3 million and depreciation expense of $0.1 million for the six months ended June 30, 2026.
6(d) To reflect the elimination of amortization expense associated with InMed’s intangible assets expected to have de minimis fair value as of the closing of the Merger. As a result, the unaudited pro forma condensed combined statement of operations reflects the elimination of $0.2 million of amortization expense for the year ended December 31, 2025 and less than $0.1 million of amortization expense for the six months ended June 30, 2026.
6(e) To reflect Mentari’s interest expense related to its convertible notes that is recorded in its historical financial statements, to be derecognized in the unaudited pro forma condensed combined statement of operations of $0.7 million for the six months ended June 30, 2026, assuming the adjustment described in Note 5(c) was made on January 1, 2025.
6(f) The pro forma combined basic and diluted net loss per share has been adjusted to reflect the pro forma net loss for the six months ended June 30, 2026 and the year ended December 31, 2025. In addition, the number of shares used in calculating the pro forma combined basic and diluted net loss per share has been adjusted to reflect the estimated total number of shares of common stock of the Combined Company for the respective periods, after giving effect to the one-for-ten reverse stock split on InMed’s common stock reflected in the Exchange Ratio of 0.20065. Pro forma weighted average shares outstanding includes the pre-funded warrants related to the Subscription Agreement as the exercise price is negligible and they are fully vested and exercisable. Shares of newly created InMed Series A non-voting Preferred Stock share the same characteristics as common stock and have no substantive preference attributed to them and, accordingly, have been considered a class of common stock in the computation of net loss per share regardless of their legal form. Net loss is allocated to common stock based on its proportional ownership on an as-converted basis. Net loss is not allocated to participating securities as they do not have an obligation to fund losses.
The pro forma weighted average shares have been calculated as follows:
| June 30, 2026 | December 31, 2025 |
|||||||
| Basic and Diluted |
Basic and Diluted |
|||||||
| Net loss from continuing operations attributable to common stockholders (in thousands) |
$ | (34,715 | ) | $ | (25,038 | ) | ||
| Net loss from continuing operations attributable to Series A non-voting convertible preferred stockholders (in thousands) |
$ | (2,575 | ) | $ | (1,863 | ) | ||
| Historical weighted average number of InMed common shares outstanding |
437,611 | 263,627 | ||||||
| Shares of InMed common stock issued to Mentari stockholders upon close of Merger, assuming consummation of the Merger as of January 1, 2025(1) |
53,661,477 | 53,661,477 | ||||||
|
|
|
|
|
|||||
| Pro forma combined weighted average number of common shares outstanding |
54,099,088 | 53,925,104 | ||||||
|
|
|
|
|
|||||
| Pro forma combined weighted average number of shares of Series A non-voting convertible preferred stock outstanding |
4,013 | 4,013 | ||||||
| Net loss per share attributable to common stockholders, basic and diluted |
$ | (0.64 | ) | $ | (0.46 | ) | ||
| Net loss per share attributable to Series A non-voting convertible preferred stockholders, basic and diluted |
$ | (641.66 | ) | $ | (464.30 | ) | ||
| (1) | Represents the estimated shares of InMed common stock and pre-funded warrants issued to Mentari stockholders at the closing of the Merger, excluding (i) the outstanding and unvested Mentari restricted stock at the closing of the Merger that were converted to the right to receive 61,310 shares of the InMed common stock as of June 30, 2026 and December 31, 2025, and 2,362,391 options to purchase shares of InMed common stock as of June 30, 2026 and December 31, 2025 after reflecting the estimated Exchange Ratio, (ii) the outstanding shares of Mentari Series Seed preferred stock that were exchanged for 4,013 shares of newly created InMed Series A Preferred Stock as of June 30, 2026 and December 31, 2025, and (iii) the outstanding warrants to purchase Mentari common stock at the closing of the Merger that were converted to the right to receive 131,193 warrants to purchase shares of InMed common stock as of June 30, 2026 and December 31, 2025, after reflecting the estimated Exchange Ratio. The shares of InMed common stock issued in exchange for shares of Mentari restricted stock to purchase shares of InMed common stock issued in exchange for options to purchase shares of Mentari common stock are subject to the same vesting and forfeiture conditions, applicable, as they were prior to the Merger. |
Please see below selected financial data presenting selected share and per share data reflecting the effect of the reverse stock split on all periods previously reported. The selected financial data is derived from the consolidated financial statements included in the InMed’s Annual Report on Form 10-K filed with the SEC on September 9, 2026, as adjusted to reflect the one-for-ten reverse stock split effected on November 4, 2026, for all periods presented.
| AS REPORTED | Years Ended June 30, |
|||||||
| (in thousands, except for per share amounts) |
2026 | 2025 | ||||||
| Weighted average number of InMed common shares outstanding, basic and diluted |
4,164 | 976 | ||||||
| Common shares outstanding at period end |
5,399 | 2,002 | ||||||
| Net loss attributable to common stockholders |
$ | (12,993 | ) | $ | (8,162 | ) | ||
| Net loss per share, basic and diluted |
$ | (3.12 | ) | $ | (8.36 | ) | ||
| AS ADJUSTED FOR THE ONE-FOR-TEN REVERSE STOCK SPLIT | Years Ended June 30, |
|||||||
| (in thousands, except for per share amounts) |
2026 | 2025 | ||||||
| Weighted average number of InMed common shares outstanding, basic and diluted |
416 | 98 | ||||||
| Common shares outstanding at period end |
540 | 200 | ||||||
| Net loss attributable to common stockholders |
$ | (12,993 | ) | $ | (8,162 | ) | ||
| Net loss per share, basic and diluted |
$ | (31.20 | ) | $ | (83.63 | ) | ||