NOTE 9. LUNAI BIOWORKS TRANSACTIONS

Intellectual Property Development and Services Agreement with Lunai Bioworks, Inc.

On April 17, 2026, the Company and Lunai Bioworks, Inc., a Delaware corporation (“Lunai”) entered into an intellectual property development and services agreement (“IP Services Agreement”), whereby the Company was to perform intellectual property development and business development services relating to a Nose-to-Brain (“N2B”) delivery platform. This includes applications in biodefense, Alzheimer’s disease (“AD”), and broader central nervous system (“CNS”) indications and excludes Parkinson’s disease and sexual dysfunction. The work shall focus on direct-to-CNS delivery to bypass the blood-brain barrier. The scope of services included scientific development, IP execution, technical data delivery, business development support and broadened biodefense focus. In connection with these services, Lunai agreed to compensate the Company a total compensation of $250,000, of which $62,500 was payable upon signing of the IP Services Agreement, $62,500 upon filing of provisional patents and $125,000 payable upon the execution of a biodefense and neurodegenerative platform IP acquisition agreement by Lunai, which was the agreement and plan for merger with Lunai, described below. The Company has completed all its obligations under the IP Services Agreement, invoiced Lunai for the services and recognized the revenue under the IP Services Agreement during the three and six months ended June 30, 2026 for an aggregate amount of $250,000, which was recorded as service revenue in the unaudited condensed consolidated statement of operations for the three and six months ended June 30, 2026. No similar services revenue were recorded in the three and six months ended June 30, 2025.

Agreement and Plan of Merger with Lunai

On April 27, 2026, Oncotelic Inc., a wholly owned subsidiary of the Company, entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Lunai, Lunai Bioworks IP, Inc., a Delaware corporation and a wholly owned subsidiary of Lunai (“Merger Sub”), Neurobridge IP Holdings Incorporated, a Delaware corporation (“Holdings”), and the holders of all of the issued and outstanding capital stock of Holdings, namely Oncotelic Inc. and Pelerin Therapeutics Inc., a corporation existing under the laws of the Province of British Columbia, Canada (“Pelerin” and, together with Oncotelic Inc., the “Holders”). Pursuant to the Merger Agreement, Holdings merged with and into Merger Sub in a triangular merger (the “Merger”), with Merger Sub continuing as the surviving corporation and as a wholly owned subsidiary of Lunai. The Merger was completed on May 1, 2026. Immediately prior to the effective time of the Merger, all of the issued and outstanding capital stock of Holdings was owned 62.5% by Oncotelic Inc. and 37.5% by Pelerin. The sole assets of Holdings at the effective time of the Merger consisted of a multi-jurisdictional patent portfolio (collectively, and as further defined in the Merger Agreement, the “Patents”), which the Holders had contributed to Holdings prior to the effective time. In consideration for the Merger, on May 1, 2026 Lunai issued to the Holders an aggregate of eight (8) shares of a newly designated series of preferred stock of Lunai, designated as “Series B Convertible Preferred Stock” (the “Series B Preferred Stock”), having an aggregate stated value (the “Stated Value”) of $20,000,000. The Series B Preferred Stock was allocated five (5) shares to Oncotelic Inc. (representing 62.5% of the Series B Preferred Stock and an aggregate Stated Value of $12,500,000). For more information on the Merger Agreement, refer to our Current Report on Form 8-K filed with the SEC on May 5, 2026.

IP Assignment Agreement

In connection with the Merger Agreement, on April 27, 2026, Oncotelic Inc. entered into an IP Assignment Agreement with Holdings, pursuant to which it agreed to contribute and assign certain assets relating to the intellectual property of the Company (collectively, the “Intellectual Property Assets”) to Holdings. For more information on the Merger Agreement, refer to our Current Report on Form 8-K filed with the SEC on May 5, 2026.

IP Grant-back Agreement

Further, on April 27, 2026, the Company and Holdings entered into an Intellectual Property Assignment and Grant-back Agreement (the “IP Grant-back Agreement”). The IP Grant-back Agreement grants back to the Company a perpetual, irrevocable, royalty-free, exclusive, non-terminable, and non-cancellable license to make, have made, use, offer to sell, sell, and otherwise exploit the Intellectual Property Assets in all fields of use except the Biodefense Field and the Alzheimer’s Disease Field as defined in the IP Grant-back Agreement, giving Holdings exclusive use of the Intellectual Property Assets in those fields. For more information on the Merger Agreement, refer to our Current Report on Form 8-K filed with the SEC on May 5, 2026.

Asset Transfer Agreement

Further, on April 30, 2026, Oncotelic Inc. on behalf of the Company, and Autotelic Inc. (“Autotelic”) entered into an asset transfer agreement (the “Asset Transfer Agreement”) pursuant to which Autotelic agreed to transfer all the rights, title and interest to certain assets (“Assets”), described below and owned by Autotelic to Oncotelic Inc. This Asset Transfer Agreement was entered into by both parties to effectuate the Merger Agreement. Dr. Trieu, Chairman and CEO of Oncotelic Therapeutics, Inc., is a partial owner and control person in Autotelic Inc. Autotelic Inc. currently owns less than 10% of the Company. The Assets transferred pursuant to the Asset Transfer Agreement include Peptide Y (including all variants, analogs, derivatives); Parathyroid Hormone (“PTH”), including PTH 1-34, PTH 1-84, and derivatives; Insulin (including intranasal and other formulations); Apomorphine (including intranasal and other formulations); Carbetocin (including intranasal and other formulations); any associated combination therapies, including multi-agent CNS, AD, metabolic, endocrine, or biodefense applications; and all delivery platforms, including nasal, injectable, and device-based systems and includes all patents, patent applications, know-how, trade secrets, data, formulations, manufacturing processes, regulatory filings, and all related rights associated with the Assets. In consideration for the transfer of the Assets, the Company shall issue equity of ten percent (10%) of the fully diluted outstanding shares of the Company, issuable on an uplisting of its capital stock to NYSE/NASDAQ. No cash was paid for the Asset Transfer Agreement.

The consideration payable to Autotelic is contingent on the Company uplisting its Common Stock to a nationally recognized stock exchange. Such shares of the Company have not been issued to Autotelic as of the date of this filing and are not legally due to be issued until the uplisting of the Company’s stock onto a nationally recognized stock exchange. If the uplisting does not occur, then the shares would not be issuable, and neither would the transaction with Lunai be invalidated.

Even though the Company received the Series B Preferred Stock from Lunai with a stated value of $12.5 million, the Company initially recorded $1.1 million as a fair value for its investment in Lunai upon the exchange of the Company’s non-financial asset, which had zero carrying basis. At June 30, 2026, the Company increased the fair value of its equity investment by an additional $0.3 million, which is presented in change in fair value equity investment in the Company’s unaudited condensed consolidated statement of operations for the three and six months ended June 30, 2026. Such increase was attributable to the increase in the market capitalization of Lunai. For more information on the fair value of the investment in Lunai, refer to Fair Value Hierarchy – Lunai above.