SERIES SEED PREFERRED STOCK PURCHASE AGREEMENT
Execution Version
Dated as of February 9, 2026
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SERIES SEED PREFERRED STOCK PURCHASE AGREEMENT
This Series Seed Preferred Stock Purchase Agreement (this "Agreement") is made and entered into as of February 9, 2026 (the "Agreement Date"), by and among Meridian Diagnostics, Inc., a Delaware corporation (the "Company"), and the investors listed on the Schedule of Investors attached hereto as Exhibit A (each an "Investor" and collectively, the "Investors").
RECITALS
WHEREAS, the Company is a corporation duly organized and existing under the laws of the State of Delaware, with its principal office located at 225 Binney Street, Suite 400, Cambridge, MA 02142, Employer Identification Number 93-4127856, Delaware Corporation File No. 7294531;
WHEREAS, the Company desires to sell and issue, and the Investors desire to purchase and acquire, an aggregate of 4,479,981 shares of Series Seed Preferred Stock, par value $0.00001 per share, of the Company (the "Shares") at a purchase price of $2.6786 per share (the "Purchase Price"), for an aggregate purchase price of Twelve Million Dollars ($12,000,000.00);
WHEREAS, the rights, preferences, privileges, and restrictions of the Series Seed Preferred Stock are as set forth in the Amended and Restated Certificate of Incorporation of the Company in the form attached hereto as Exhibit B (the "Restated Certificate"), which Restated Certificate is to be filed with the Secretary of State of the State of Delaware prior to or contemporaneously with the Closing (as defined herein);
WHEREAS, the offering and sale of the Shares to the Investors pursuant to this Agreement is exempt from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), pursuant to Regulation D, Rule 506(b) promulgated thereunder, and all of the Investors are "accredited investors" as that term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act; and
WHEREAS, certain holders of convertible promissory notes of the Company (the "Noteholders") will convert their outstanding convertible promissory notes into shares of Series Seed Preferred Stock contemporaneously with the Closing, as further described in Section 1.3 of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual promises, covenants, representations, and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE 1: PURCHASE AND SALE OF SHARES
Section 1.1 — Sale and Issuance of Series Seed Preferred Stock.
Subject to the terms and conditions of this Agreement, each Investor agrees, severally and not jointly, to purchase at the Closing, and the Company agrees to sell and issue to each such Investor at the Closing, the number of Shares set forth opposite such Investor's name on the Schedule of Investors attached hereto as Exhibit A, at the Purchase Price of $2.6786 per share. The aggregate number of Shares to be sold and issued to all Investors hereunder shall be 4,479,981 shares of Series Seed Preferred Stock, for an aggregate purchase price of Twelve Million Dollars ($12,000,000.00). Each Investor's obligation to purchase the Shares shall be several and not joint, such that no Investor shall have any liability or obligation arising out of any other Investor's failure to purchase Shares at the Closing. The Shares shall have the rights, preferences, privileges, and restrictions set forth in the Restated Certificate.
Section 1.2 — Closing; Delivery.
(a) Closing. The closing of the purchase and sale of the Shares (the "Closing") shall take place on February 9, 2026 (the "Closing Date"), simultaneously with the execution and delivery of this Agreement by the Company and each of the Investors. The Closing shall be deemed to occur on the Closing Date upon the satisfaction or waiver of all conditions to Closing set forth in Articles 4 and 5 hereof and the delivery of the items specified in Sections 1.2(c) and 1.2(d) below.
(b) Location. The Closing shall take place remotely via the electronic exchange of documents and signatures, or, at the election of the Lead Investor, at the offices of Calderwood & Harkness LLP, 1800 Page Mill Road, Suite 200, Menlo Park, CA 94025, counsel to the Lead Investor.
(c) Delivery by the Company. At the Closing, the Company shall deliver to each Investor (i) a stock certificate or, at the election of the Company, evidence of book-entry registration with Ledgermark Transfer Services, Inc. (the "Transfer Agent"), representing the number of Shares purchased by such Investor as set forth on the Schedule of Investors, registered in the name of such Investor (or its designee, as specified in writing to the Company prior to the Closing), and (ii) copies of the Secretary's Certificate and Compliance Certificate described in Sections 4.10 and 4.11, respectively.
(d) Delivery by the Investors. At the Closing, each Investor shall deliver to the Company, by wire transfer of immediately available United States dollars to the escrow account maintained by Granite Trust Company, N.A. (the "Escrow Agent"), the aggregate Purchase Price for the Shares being purchased by such Investor, in accordance with the wire instructions set forth in the Closing Funds Flow Memorandum delivered by the Company to each Investor no later than three (3) business days prior to the Closing Date. The Escrow Agent shall release such funds to the Company promptly upon confirmation that all conditions to the Closing have been satisfied or waived and that all deliverables required under this Section 1.2 have been duly exchanged.
Section 1.3 — Convertible Note Conversion.
(a) Conversion of Notes. Contemporaneously with the Closing, the outstanding convertible promissory notes issued by the Company on September 12, 2023 (each, a "Note" and collectively, the "Notes"), pursuant to that certain Convertible Note Purchase Agreement dated September 12, 2023, in the aggregate original principal amount of Two Million One Hundred Thousand Dollars ($2,100,000.00), shall automatically convert into shares of Series Seed Preferred Stock of the Company in accordance with the terms of the Notes and this Section 1.3.
(b) Noteholders and Principal Amounts. The Noteholders and their respective principal amounts under the Notes are as follows:
(c) Interest. Each Note bears simple interest at the rate of five percent (5.0%) per annum. As of the Closing Date, the aggregate accrued and unpaid interest on the Notes is approximately Two Hundred Fifty-Three Thousand Seven Hundred Fifty Dollars ($253,750.00). For purposes of the conversion, the total conversion amount (principal plus accrued interest) shall be approximately Two Million Three Hundred Fifty-Three Thousand Seven Hundred Fifty Dollars ($2,353,750.00) (the "Total Conversion Amount").
(d) Conversion Price. In accordance with the terms of the Notes, the conversion price per share applicable to the conversion of the Notes shall be the lower of:
(i) the Purchase Price multiplied by 0.80 (i.e., the "discount Price"), which equals $2.1429 per share; and
(ii) the quotient obtained by dividing the valuation cap of Twenty-Five Million Dollars ($25,000,000.00) by the pre-money fully-diluted capitalization of 11,200,000 shares (i.e., the "Cap Price"), which equals approximately $2.2321 per share.
Because the discount Price of $2.1429 per share is lower than the Cap Price of $2.2321 per share, the conversion price applicable to the Notes shall be $2.1429 per share (the "Conversion Price").
(e) Shares Issuable upon Conversion. Based on the Total Conversion Amount and the Conversion Price, the aggregate number of shares of Series Seed Preferred Stock issuable to the Noteholders upon conversion of the Notes shall be approximately 1,098,362 shares (the "Conversion Shares"). The exact number of Conversion Shares issuable to each Noteholder shall be determined by dividing such Noteholder's proportionate share of the Total Conversion Amount by the Conversion Price, with any fractional shares rounded down to the nearest whole share.
(f) Rights of Conversion Shares. The Conversion Shares shall have identical rights, preferences, privileges, and restrictions as the Shares purchased by the Investors hereunder, except that the original issue price of the Conversion Shares for purposes of the liquidation preference set forth in the Restated Certificate shall be equal to the Conversion Price (i.e., $2.1429 per share) rather than the Purchase Price.
(g) Cancellation of Notes. Upon the issuance of the Conversion Shares to the Noteholders at the Closing, each Note shall be deemed fully converted, satisfied, and cancelled, and no further amounts shall be owed by the Company thereunder.
Section 1.4 — Use of Proceeds.
The Company shall use the proceeds of the sale of the Shares for general corporate purposes, including, without limitation, (a) the continued development, testing, and commercialization of the MeridianPulse point-of-care diagnostic platform, (b) working capital requirements, (c) hiring of additional personnel, and (d) general and administrative expenses. Nothing in this Section 1.4 shall limit the Company's discretion to allocate the proceeds among the foregoing categories as the Board of Directors of the Company determines in its reasonable business judgment.
Section 1.5 — Defined Terms.
As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not otherwise defined in this Section 1.5 shall have the meanings ascribed to them elsewhere in this Agreement.
"2024 Plan" means the Company's 2024 Equity Incentive Plan, as adopted on March 1, 2024, and as amended from time to time, including the increase in shares reserved for issuance described in Section 2.2(c).
"Affiliate" means, with respect to any specified Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person. For purposes of this definition, "control" (including the terms "controlled by" and "under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract, or otherwise.
"Board" or "Board of Directors" means the Board of Directors of the Company as constituted from time to time.
"Business Day" means any day that is not a Saturday, Sunday, or other day on which commercial banks in the City of New York or the Commonwealth of Massachusetts are authorized or required by law to remain closed.
"Closing" has the meaning set forth in Section 1.2(a).
"Closing Date" has the meaning set forth in Section 1.2(a).
"Cobalt Side Letter" has the meaning set forth in Section 4.4(e).
"Common Stock" means the Common Stock, par value $0.00001 per share, of the Company.
"Conversion Price" has the meaning set forth in Section 1.3(d).
"Conversion Shares" has the meaning set forth in Section 1.3(e).
"Escrow Agent" means Granite Trust Company, N.A.
"GAAP" means United States generally accepted accounting principles, consistently applied.
"Governmental Authority" means any federal, state, local, municipal, foreign, or other government or governmental or quasi-governmental body, or any department, commission, board, bureau, agency, authority, or instrumentality thereof, or any court, tribunal, or arbitrator.
"Key Holders" means Dr. Priya Ramaswamy and Dr. Julian Ochoa.
"Knowledge of the Company" or "Company's knowledge" means the actual knowledge of Dr. Priya Ramaswamy and Dr. Julian Ochoa, after reasonable inquiry of their direct reports.
"Lead Investor" means Cobalt Ventures Fund III, LP, a Delaware limited partnership (EIN 85-2093147), with its principal office at 2400 Sand Hill Road, Suite 310, Menlo Park, CA 94025.
"Liens" means any mortgage, pledge, security interest, encumbrance, lien, restriction on transfer, or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof), whether arising by contract, operation of law, or otherwise.
"Major Investor" means any Investor (or any transferee or assignee thereof) that holds at least 1,000,000 shares of Series Seed Preferred Stock (or shares of Common Stock issued upon conversion thereof), in each case as adjusted for any stock splits, stock dividends, combinations, recapitalizations, or similar events.
"Material Adverse Effect" means any event, circumstance, development, change, or effect that, individually or in the aggregate, is or would reasonably be expected to be materially adverse to (a) the business, assets, liabilities, financial condition, results of operations, or prospects of the Company, or (b) the ability of the Company to consummate the transactions contemplated by the Transaction Agreements.
"Notes" has the meaning set forth in Section 1.3(a).
"Noteholders" means the holders of the Notes, as identified in Section 1.3(b).
"Person" means any individual, corporation, limited liability company, partnership, joint venture, association, trust, unincorporated organization, or other entity, including any Governmental Authority.
"Pinewood Side Letter" has the meaning set forth in Section 4.4(f).
"Purchase Price" has the meaning set forth in the Recitals.
"Restated Certificate" means the Amended and Restated Certificate of Incorporation of the Company, in the form attached hereto as Exhibit B, as filed (or to be filed) with the Secretary of State of the State of Delaware.
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
"Series Seed Preferred Stock" means the Series Seed Preferred Stock, par value $0.00001 per share, of the Company, having the rights, preferences, privileges, and restrictions set forth in the Restated Certificate.
"Shares" has the meaning set forth in the Recitals.
"Total Conversion Amount" has the meaning set forth in Section 1.3(c).
"Transaction Agreements" means, collectively, this Agreement, the Investors' Rights Agreement in the form attached hereto as Exhibit C, the Right of First Refusal and Co-Sale Agreement in the form attached hereto as Exhibit D, the Voting Agreement in the form attached hereto as Exhibit E, the Cobalt Side Letter, the Pinewood Side Letter, and each other agreement, certificate, or instrument delivered in connection with the transactions contemplated hereby.
"Transfer Agent" has the meaning set forth in Section 1.2(c).
ARTICLE 2: REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to each Investor as of the date hereof and as of the Closing Date as follows (except where a representation or warranty speaks as of a specific date, in which case such representation or warranty shall be made as of such date). Each representation and warranty set forth in this Article 2 is subject to and qualified by the exceptions and disclosures set forth in the Schedule of Exceptions (Disclosure Schedule) delivered by the Company to the Investors concurrently with the execution of this Agreement, organized by section number corresponding to the sections of this Article 2 (the "Disclosure Schedule"). Disclosure of any item in the Disclosure Schedule with respect to any particular section of this Article 2 shall be deemed to be disclosed with respect to each other section of this Article 2 to the extent that the relevance of such disclosure to such other section is reasonably apparent on the face of such disclosure.
Section 2.1 — Organization; Good Standing; Qualification.
The Company is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware. The Company was incorporated on June 15, 2023, and has been assigned Delaware Corporation File No. 7294531. The Company has the requisite corporate power and authority to own and operate its properties and assets, to carry on its business as presently conducted and as presently proposed to be conducted, and to execute, deliver, and perform its obligations under this Agreement and each of the other Transaction Agreements. The Company is duly qualified to transact business as a foreign corporation and is in good standing in the Commonwealth of Massachusetts, where its principal office is located at 225 Binney Street, Suite 400, Cambridge, MA 02142. The Company is not required to be qualified to transact business in any other jurisdiction, except where the failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 2.2 — Capitalization.
(a) Pre-Financing Capitalization. Immediately prior to the Closing and after giving effect to the option pool increase described in Section 2.2(c) below, the authorized capital stock of the Company consists of the shares as set forth in the Restated Certificate. The issued and outstanding shares of capital stock of the Company are as follows:
(i) Common Stock. 10,000,000 shares of Common Stock are issued and outstanding, held as follows:
The 600,000 shares held by Nadia Chen are subject to a stock restriction agreement providing for four-year vesting with a one-year cliff, monthly vesting thereafter, with a vesting commencement date of August 1, 2024. As of the date hereof, approximately 18 months of vesting have elapsed, and approximately 262,500 of such shares are vested.
(ii) Option Pool. The remaining 400,000 shares (prior to the pool expansion described in Section 2.2(c)) are reserved for issuance under the 2024 Plan, of which 175,000 shares are subject to outstanding option grants to employees and consultants of the Company, and 225,000 shares remain available for future issuance.
(iii) Notes. The Notes described in Section 1.3, in the aggregate original principal amount of $2,100,000.00, are outstanding and will convert into shares of Series Seed Preferred Stock contemporaneously with the Closing.
(iv) No Other Securities. Except as set forth in this Section 2.2(a) and the Notes described in Section 1.3, no other shares of capital stock or other equity securities of the Company are issued, reserved for issuance, or outstanding.
(b) Post-Financing Capitalization. Immediately after the Closing, after giving effect to the issuance of the Shares to the Investors and the issuance of the Conversion Shares to the Noteholders, the capitalization of the Company shall be as follows:
(i) Common Stock Outstanding: 10,000,000 shares.
(ii) Series Seed Preferred Stock Issued for New Investment: 4,479,981 shares, issued to the Investors pursuant to this Agreement.
(iii) Series Seed Preferred Stock Issued upon Conversion of Notes: Approximately 1,098,362 shares, issued to the Noteholders upon conversion of the Notes pursuant to Section 1.3.
(iv) Total Series Seed Preferred Stock Outstanding: Approximately 5,578,343 shares.
(v) Option Pool (2024 Plan): 1,600,000 shares reserved for issuance (after the pool expansion described in Section 2.2(c)), of which 175,000 shares are subject to outstanding option grants and 1,425,000 shares remain available for future issuance.
(vi) Pre-Money Fully-Diluted Capitalization: 11,200,000 shares (consisting of 10,000,000 shares of Common Stock outstanding plus 1,200,000 shares added to the option pool).
(vii) Post-Money Fully-Diluted Capitalization (Excluding Conversion Shares): 15,679,981 shares.
(viii) Total Fully-Diluted Capitalization (Including Conversion Shares): 16,778,343 shares.
(ix) Pre-Money Valuation: $30,000,000.00. Post-Money Valuation: $42,000,000.00.
(c) Option Pool Expansion. Prior to the Closing, the Board of Directors and the stockholders of the Company have duly approved an increase of 1,200,000 shares reserved for issuance under the 2024 Equity Incentive Plan (which was adopted on March 1, 2024), bringing the total number of shares reserved for issuance under the 2024 Plan from 400,000 shares to 1,600,000 shares. Of such 1,600,000 shares, 175,000 shares are subject to outstanding option grants and 1,425,000 shares remain available for future issuance. The terms and conditions of all outstanding option grants are as set forth on the Disclosure Schedule.
(d) No Other Equity Securities. Except as set forth in this Section 2.2 and the Notes described in Section 1.3, there are no outstanding options, warrants, rights (including conversion or preemptive rights and rights of first refusal or similar rights), convertible or exchangeable securities, or other agreements or commitments obligating the Company to issue or sell any shares of capital stock of, or other equity interests in, the Company. Other than the Transaction Agreements and the existing stock restriction agreement applicable to Nadia Chen's shares, there are no agreements, stockholders' agreements, voting trusts, proxies, or other arrangements relating to the voting or transfer of the Company's capital stock.
(e) Accuracy of Capitalization Table. The capitalization table attached hereto as Schedule 2.2 is true, correct, and complete in all material respects as of the date hereof and as of immediately after giving effect to the Closing (including the issuance of the Shares and the Conversion Shares).
Section 2.3 — Authorization.
All corporate action on the part of the Company, its officers, directors, and stockholders necessary for the authorization, execution, delivery, and performance of this Agreement and each of the other Transaction Agreements, the authorization, sale, issuance, and delivery of the Shares and the Conversion Shares, the filing of the Restated Certificate with the Secretary of State of the State of Delaware, and the reservation and subsequent issuance of shares of Common Stock issuable upon conversion of the Shares and the Conversion Shares, has been taken or will be taken prior to the Closing. This Agreement and each of the other Transaction Agreements, when executed and delivered by the Company, shall constitute the valid and legally binding obligation of the Company, enforceable in accordance with their respective terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting the enforcement of creditors' rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies (collectively, the "Enforceability Exceptions"). The Board of Directors of the Company has adopted resolutions (the "Board Consent") approving the Transaction Agreements and the transactions contemplated hereby and thereby, and the stockholders of the Company holding the requisite number of shares have executed a written consent (the "Stockholder Consent") approving the Restated Certificate, the option pool increase described in Section 2.2(c), and the other matters requiring stockholder approval in connection with the transactions contemplated hereby.
Section 2.4 — Valid Issuance of Shares.
The Shares, when issued, sold, and delivered in accordance with the terms and for the consideration set forth in this Agreement, will be duly and validly authorized, fully paid and non-assessable, and free and clear of all Liens and encumbrances, other than restrictions on transfer under (i) this Agreement, (ii) the Investors' Rights Agreement, (iii) the Right of First Refusal and Co-Sale Agreement, (iv) applicable state and federal securities laws, and (v) the Restated Certificate. The Conversion Shares, when issued upon conversion of the Notes in accordance with Section 1.3, will be duly and validly authorized, fully paid and non-assessable, and free and clear of all Liens and encumbrances, other than the restrictions described in the immediately preceding sentence. The shares of Common Stock issuable upon conversion of the Shares and the Conversion Shares have been duly reserved for issuance, and upon issuance in accordance with the terms of the Restated Certificate, will be duly and validly issued, fully paid and non-assessable, and free and clear of all Liens and encumbrances, other than restrictions imposed by applicable securities laws. Assuming the accuracy of the representations of the Investors in Article 3 of this Agreement, the Shares and the Conversion Shares will be issued in compliance with all applicable federal and state securities laws.
Section 2.5 — Governmental Consents and Filings.
No consent, approval, order, or authorization of, or registration, qualification, designation, declaration, or filing with, any Governmental Authority is required on the part of the Company in connection with the consummation of the transactions contemplated by this Agreement, except for:
(a) the filing of the Restated Certificate with the Secretary of State of the State of Delaware, which filing shall be made prior to or contemporaneously with the Closing;
(b) the filing of a notice on Form D with the United States Securities and Exchange Commission (the "SEC") pursuant to Regulation D under the Securities Act, which filing shall be made within fifteen (15) days after the first sale of the Shares (filing deadline: February 24, 2026);
(c) notice filings and blue sky filings required under the securities laws of the states of California, Massachusetts, New York, and Texas, which filings shall be made within the time periods required by applicable law; and
(d) the qualification of the Company as a foreign corporation in applicable jurisdictions, which qualification has already been completed for the Commonwealth of Massachusetts and is not currently required in any other jurisdiction.
Section 2.6 — Litigation.
There is no action, suit, proceeding, claim, arbitration, mediation, or investigation (each, an "Action") pending or, to the Company's knowledge, currently threatened in writing against the Company, any of its officers or directors (in their capacities as such), or any of the Company's properties or assets, before any court, arbitrator, or Governmental Authority. The Company is not a party to or subject to the provisions of any order, writ, judgment, injunction, or decree of any court or Governmental Authority. There is no Action by the Company currently pending or that the Company intends to initiate. To the Company's knowledge, there are no facts or circumstances that would reasonably be expected to give rise to any Action against the Company.
Section 2.7 — Intellectual Property.
(a) The Company owns or possesses sufficient legal rights to all patents, patent applications, trademarks, trademark applications, service marks, trade names, copyrights, trade secrets, licenses, domain names, mask works, know-how, and other intellectual property rights (collectively, "intellectual Property") necessary for its business as presently conducted and as presently proposed to be conducted, without any known conflict with, or infringement of, the rights of others.
(b) The Company's patent portfolio consists of five (5) issued United States utility patents and three (3) pending Patent Cooperation Treaty ("PCT") international applications, all of which relate to the Company's MeridianPulse point-of-care diagnostic platform, including its proprietary 14-marker blood panel technology capable of delivering results in under eight (8) minutes. A complete list of such patents and patent applications, including application numbers, filing dates, and current status, is set forth on the Disclosure Schedule.
(c) To the Company's knowledge, no third party has asserted any claim, and no proceeding is pending or threatened in writing, alleging that the Company's conduct of its business infringes, misappropriates, or otherwise violates any intellectual Property rights of any third party. To the Company's knowledge, no third party is infringing, misappropriating, or otherwise violating any intellectual Property owned by the Company.
(d) All current and former employees, officers, and consultants of the Company who have contributed to the development of any intellectual Property on behalf of the Company have executed proprietary information and inventions assignment agreements in substantially the form attached hereto as Exhibit H or in a form otherwise reasonably acceptable to the Company, and no such person has, to the Company's knowledge, breached any such agreement.
(e) The Company has taken commercially reasonable steps to maintain the confidentiality of its trade secrets and other confidential proprietary information. No trade secrets or other confidential information material to the Company's business have been disclosed to any third party other than pursuant to written non-disclosure agreements.
Section 2.8 — Compliance with Other Instruments.
The Company is not in violation or default of (a) any provision of its Certificate of Incorporation (as amended through the date hereof) or Bylaws, (b) any judgment, order, writ, or decree of any court or Governmental Authority applicable to the Company, or (c) any material note, indenture, mortgage, lease, agreement, contract, purchase order, or other instrument, document, or agreement to which the Company is a party or by which the Company is bound, or to which any of its properties or assets is subject. The execution, delivery, and performance by the Company of this Agreement and the other Transaction Agreements, and the consummation of the transactions contemplated hereby and thereby (including the issuance of the Shares and the Conversion Shares and the filing of the Restated Certificate), will not (i) result in any such violation or default, or constitute an event that, with notice or lapse of time or both, would result in any such violation or default, or (ii) result in the creation of any Lien upon any of the properties or assets of the Company.
Section 2.9 — Material Contracts.
The Company has disclosed or made available to the Investors true, complete, and correct copies of all material contracts, agreements, and instruments to which the Company is a party or by which it is bound, including, without limitation:
(a) the Convertible Note Purchase Agreement dated September 12, 2023, and the Notes issued thereunder to Dr. Margaret Liu and Clearwater Bridge Associates, LLC;
(b) the lease agreement for the Company's principal office at 225 Binney Street, Suite 400, Cambridge, MA 02142;
(c) the 2024 Equity Incentive Plan, including all outstanding option award agreements;
(d) all employment agreements with officers and key employees;
(e) all consulting agreements involving aggregate payments in excess of $25,000 per annum;
(f) all agreements involving the license of intellectual Property to or from the Company; and
(g) all other agreements involving aggregate commitments in excess of $50,000 per annum.
The Company is not in default under any such material contract, and, to the Company's knowledge, no other party to any such material contract is in default thereunder. Each such material contract is in full force and effect and constitutes a legal, valid, and binding obligation of the Company, enforceable in accordance with its terms, subject to the Enforceability Exceptions.
Section 2.10 — Agreements with Officers, Directors, and Key Employees.
All current employees and key consultants of the Company have entered into, or will enter into at or prior to the Closing, proprietary information and inventions assignment agreements ("PIIAs") in a form reasonably acceptable to the Lead Investor. Each of the Key Holders (Dr. Priya Ramaswamy and Dr. Julian Ochoa) will, at the Closing, enter into a Founder Stock Restriction Agreement in the form attached hereto as Exhibit G, providing for four-year reverse vesting with a one-year cliff, vesting commencing as of June 15, 2023. To the Company's knowledge, no officer, director, or key employee of the Company is in violation of any term of any employment contract, proprietary information agreement, non-competition agreement, or any other restrictive covenant relating to the right of any such person to be employed by the Company or to use trade secrets or proprietary information of others.
Section 2.11 — Related-Party Transactions.
No transaction has been entered into between the Company, on the one hand, and any officer, director, or holder of more than five percent (5%) of any class of capital stock of the Company (or any member of the immediate family of any such person, or any entity in which any such person has a beneficial ownership interest of five percent (5%) or more), on the other hand, involving aggregate consideration in excess of One Hundred Thousand Dollars ($100,000.00), other than (a) compensation arrangements entered into in the ordinary course of business and approved by the Board of Directors, and (b) the purchases of the Notes by Dr. Margaret Liu, as disclosed in Section 1.3 and on the Disclosure Schedule. The exceptions set forth in the foregoing sentence are disclosed in the Disclosure Schedule under Section 2.11.
Section 2.12 — Permits.
The Company possesses all franchises, permits, licenses, approvals, consents, and other authorizations (collectively, "Permits") from all Governmental Authorities as are necessary for the Company to own and operate its properties and assets and to carry on its business as presently conducted. The Company is not in default in any material respect under any such Permit. No suspension, revocation, or cancellation of any Permit is pending or, to the Company's knowledge, threatened.
Section 2.13 — Financial Statements.
The Company has delivered or made available to the Investors (a) an unaudited balance sheet of the Company as of December 31, 2025 (the "Balance Sheet Date"), and the related unaudited statements of operations, stockholders' equity, and cash flows for the fiscal year then ended (collectively, the "Financial Statements"). The Financial Statements have been prepared in accordance with GAAP consistently applied throughout the periods indicated, subject to normal year-end audit adjustments and the absence of footnotes. The Financial Statements fairly present in all material respects the financial condition and operating results of the Company as of the dates, and for the periods, indicated therein.
The Company's independent registered public accounting firm is Graystone & Pallister CPAs, LLP (engagement partner: Robert Milligan, CPA), located at 75 Ashbury Asset Advisors, Suite 2200, Boston, MA 02109. As of the date most recently determined prior to the Closing, the Company had approximately One Million Four Hundred Thousand Dollars ($1,400,000.00) in cash and cash equivalents. The Company's current average monthly operating expenditure (the "Burn Rate") is approximately One Hundred Eighty-Five Thousand Dollars ($185,000.00).
Section 2.14 — Changes.
Since the Balance Sheet Date, there has been no Material Adverse Effect, and no event has occurred that, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect. Without limiting the generality of the foregoing, since the Balance Sheet Date:
(a) the Company has not declared or paid any dividends or made any distribution on its capital stock;
(b) the Company has not incurred any indebtedness for money borrowed or any other material liabilities, individually or in the aggregate, other than in the ordinary course of business consistent with past practice;
(c) the Company has not sold, assigned, transferred, or otherwise disposed of any material assets, tangible or intangible, other than in the ordinary course of business;
(d) the Company has not experienced any material damage, destruction, or loss (whether or not covered by insurance) to its property;
(e) the Company has not made any material change in the compensation paid or payable to any officer, director, employee, or consultant;
(f) the Company has not issued, sold, or otherwise disposed of any equity securities, or granted any options, warrants, or other rights to purchase or obtain equity securities, other than the issuance of shares of Common Stock pursuant to the exercise of options granted under the 2024 Plan; and
(g) the Company has not entered into any agreement or commitment to do any of the foregoing.
Section 2.15 — Employee Matters.
(a) As of the date hereof, the Company has eighteen (18) full-time employees. The Company is not a party to or bound by any collective bargaining agreement or other agreement with any labor union, labor organization, or works council. To the Company's knowledge, no union organizing activities are underway or threatened with respect to the employees of the Company.
(b) There are no pending or, to the Company's knowledge, threatened labor disputes, strikes, slowdowns, work stoppages, unfair labor practice charges, grievances, complaints, or other labor-related controversies affecting the Company. The Company is in material compliance with all applicable laws, regulations, and ordinances relating to employment and employment practices, including, without limitation, terms and conditions of employment, wages and hours, child labor, immigration, employment discrimination, disability rights, equal opportunity, plant closures and layoffs (including the WARN Act), worker classification, affirmative action, workers' compensation, labor relations, employee leave issues, and unemployment insurance.
Section 2.16 — Tax Returns and Payments.
The Company has timely filed (or has caused to be timely filed) all federal, state, local, and foreign tax returns required to be filed by it, and all such tax returns are true, correct, and complete in all material respects. The Company has paid (or has caused to be paid) all taxes required to be paid by it, whether or not reflected on such tax returns, except for taxes being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP. The Company has not been notified in writing of any tax deficiency that has been proposed, asserted, or assessed against it, and the Company has no knowledge of any basis for any such deficiency. The Company is classified as a C-corporation for United States federal income tax purposes. The Company's Employer Identification Number is 93-4127856. The Company has not elected to be treated as an S-corporation under Section 1362 of the Internal Revenue Code of 1986, as amended.
Section 2.17 — Insurance.
The Company maintains insurance policies in such amounts, with such deductibles, and against such risks and losses as are reasonable and customary for companies of similar size and stage in the Company's industry. All such insurance policies are in full force and effect, all premiums currently due thereon have been paid, and the Company is in compliance in all material respects with the terms thereof. The Company has not received any notice of cancellation or non-renewal of any such policy. A summary of the Company's material insurance policies has been made available to the Investors.
Section 2.18 — Employee Benefit Plans.
(a) The Company's sole equity compensation plan is the 2024 Equity Incentive Plan, adopted on March 1, 2024. As described in Section 2.2(c), the Board of Directors and stockholders have approved an increase in the total shares reserved for issuance under the 2024 Plan from 400,000 shares to 1,600,000 shares, with 175,000 shares subject to outstanding option grants and 1,425,000 shares remaining available for future issuance.
(b) Other than the 2024 Plan, the Company does not maintain, sponsor, contribute to, or have any obligation or liability (contingent or otherwise) with respect to any "employee benefit plan" (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended) or any other material employee benefit plan, program, policy, arrangement, or agreement (whether written or unwritten) providing benefits to any current or former employee, officer, director, or consultant of the Company.
Section 2.19 — Compliance with Laws.
The Company is in compliance in all material respects with all applicable laws, rules, regulations, orders, judgments, and decrees of all Governmental Authorities, including, without limitation, all applicable laws relating to privacy and data security (including, to the extent applicable, the Health Insurance Portability and Accountability Act of 1996, the California Consumer Privacy Act, and the Massachusetts Data Privacy Law), anti-corruption (including the Foreign Corrupt Practices Act), and export controls and sanctions. The Company has not received any written notice of any alleged violation of, or non-compliance with, any such law, rule, or regulation.
Section 2.20 — Environmental and Safety Laws.
The Company is in compliance in all material respects with all applicable environmental laws, rules, and regulations (including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act, the Resource Conservation and Recovery Act, and all applicable state and local environmental laws and regulations). The Company has not generated, used, transported, treated, stored, released, or disposed of, or has permitted anyone else to generate, use, transport, treat, store, release, or dispose of, any hazardous materials in violation of any applicable environmental laws. The Company has not received any written notice regarding any actual or potential violation of any environmental law, and to the Company's knowledge, there are no facts or circumstances that would reasonably be expected to give rise to any such violation.
Section 2.21 — Real Property.
The Company does not own any real property. The Company leases its principal office at 225 Binney Street, Suite 400, Cambridge, MA 02142. The Company's lease for such office space is in full force and effect, and the Company is not in default thereunder. The Company has delivered or made available to the Lead Investor a true, complete, and correct copy of such lease, including all amendments thereto. The Company does not lease any other real property.
Section 2.22 — Disclosure.
No representation or warranty of the Company contained in this Agreement, and no statement contained in the Disclosure Schedule or any certificate, exhibit, or schedule furnished or to be furnished by the Company to the Investors pursuant to this Agreement, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary in order to make the statements contained herein or therein not misleading in light of the circumstances under which they were or are made. The Company has not intentionally withheld from the Investors any information that is material to the Company's business, assets, liabilities, financial condition, or results of operations.
ARTICLE 3: REPRESENTATIONS AND WARRANTIES OF THE INVESTORS
Each Investor, severally and not jointly, hereby represents and warrants to the Company as of the date hereof and as of the Closing Date as follows:
Section 3.1 — Authorization.
Such Investor has all requisite power and authority to enter into and perform its obligations under this Agreement and each of the other Transaction Agreements to which it is a party. The execution, delivery, and performance of this Agreement and each such other Transaction Agreement and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of such Investor (including, in the case of each entity Investor, all necessary action on the part of its general partner, managing member, board of directors, or other governing body, as applicable). This Agreement and each such other Transaction Agreement, when executed and delivered by such Investor, shall constitute the valid and legally binding obligation of such Investor, enforceable against such Investor in accordance with their respective terms, subject to the Enforceability Exceptions. The following authorized signatories are duly empowered to execute this Agreement and the other Transaction Agreements on behalf of each respective entity Investor:
(i) Cobalt Ventures Fund III, LP: Elaine Cho, Managing Partner of Cobalt Ventures GP III, LLC, its General Partner;
(ii) Pinewood Health Ventures, LLC: Sandra Kessler, Managing Member;
(iii) Thornfield Capital Partners, LP: Brian Lund, Partner of Thornfield Capital GP, LLC, its General Partner; and
(iv) Atlas Point Angel Syndicate, LLC: Victor Dominguez, Syndicate Manager.
Section 3.2 — Purchase Entirely for Own Account.
The Shares to be acquired by such Investor hereunder are being acquired for investment for such Investor's own account, not as nominee or agent for any other Person, and not with a view to the resale or distribution of any part thereof in violation of the Securities Act, and such Investor has no present intention of selling, granting any participation in, or otherwise distributing the same in any transaction that would violate the Securities Act or any applicable state securities laws. Such Investor does not presently have any contract, undertaking, agreement, or arrangement with any Person to sell, transfer, or grant participation to such Person or to any third Person, with respect to any of the Shares. If such Investor is not a natural person, such Investor also represents that it has not been formed for the specific purpose of acquiring the Shares.
Section 3.3 — Disclosure of Information.
Such Investor has received all information it considers necessary or appropriate for evaluating the merits and risks of the prospective investment in the Shares. Such Investor further represents that it has had an opportunity to ask questions of, and receive answers from, the Company and its officers and directors regarding the terms and conditions of the offering of the Shares and the business, properties, financial condition, and prospects of the Company, and to obtain any additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to verify the accuracy of the information furnished to such Investor. Such Investor acknowledges that no representations or warranties, express or implied, have been made to such Investor by or on behalf of the Company, other than those expressly set forth in this Agreement.
Section 3.4 — Restricted Securities.
Such Investor understands that the Shares have not been, and will not be, registered under the Securities Act by reason of a specific exemption from the registration provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of such Investor's representations as expressed herein. Such Investor understands that the Shares are "restricted securities" under applicable United States federal and state securities laws and that, pursuant to these laws, such Investor must hold the Shares indefinitely unless they are registered with the SEC and qualified by state securities authorities, or unless an exemption from such registration and qualification requirements is available. Such Investor acknowledges that the Company has no present obligation to register the Shares, and that, except as set forth in the Investors' Rights Agreement, the Company has no present plans to register the Shares.
Section 3.5 — Accredited Investor.
Such Investor is an "accredited investor" as defined in Rule 501(a) of Regulation D promulgated under the Securities Act. Such Investor, either alone or together with its professional advisors, has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of the prospective investment in the Shares.
Section 3.6 — No General Solicitation.
Such Investor is not purchasing the Shares as a result of any advertisement, article, notice, or other communication regarding the Shares published in any newspaper, magazine, internet website, or similar media or broadcast over television or radio, or presented at any seminar or meeting, or as a result of any other form of "general solicitation" or "general advertising" (as those terms are used in Regulation D under the Securities Act). The offer of the Shares was communicated to such Investor directly by the Company or its authorized representatives in a manner such that such Investor was able to ask questions of, and receive answers from, such representatives concerning the terms of the offering and the Company.
Section 3.7 — Legends.
Such Investor acknowledges and agrees that the stock certificates (or book-entry statements issued by the Transfer Agent) representing the Shares shall bear the following restrictive legends (or substantially equivalent legends):
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH ACT AND/OR APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A SERIES SEED PREFERRED STOCK PURCHASE AGREEMENT, AN INVESTORS' RIGHTS AGREEMENT, A RIGHT OF FIRST REFUSAL AND CO-SALE AGREEMENT, AND A VOTING AGREEMENT, COPIES OF WHICH ARE ON FILE WITH THE SECRETARY OF THE COMPANY."
Such Investor further acknowledges that such legends may include any legend required by the securities laws of any state to the extent applicable.
Section 3.8 — Exculpation Among Investors.
Such Investor acknowledges that it is not relying upon any Person, firm, or corporation (other than the Company and its officers and directors, as applicable), including any other Investor, in making its investment or decision to invest in the Company. Such Investor agrees that no other Investor, nor the respective controlling Persons, officers, directors, partners, members, agents, or employees of any other Investor, shall be liable to such Investor for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the purchase of the Shares.
ARTICLE 4: CONDITIONS TO THE INVESTORS' OBLIGATIONS AT CLOSING
The obligations of each Investor to purchase the Shares at the Closing are subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions, unless waived in writing by the Lead Investor (acting on behalf of all Investors):
Section 4.1 — Representations and Warranties.
The representations and warranties of the Company contained in Article 2 of this Agreement shall be true and correct in all material respects (or, in the case of representations and warranties qualified by materiality or Material Adverse Effect, in all respects) as of the Closing Date with the same effect as though made on and as of the Closing Date (except for representations and warranties that speak as of a specific date, which shall be true and correct as of such date).
Section 4.2 — Performance.
The Company shall have performed and complied with all covenants, agreements, obligations, and conditions contained in this Agreement that are required to be performed or complied with by the Company on or before the Closing Date.
Section 4.3 — Restated Certificate.
The Restated Certificate, in the form attached hereto as Exhibit B, shall have been duly filed with the Secretary of State of the State of Delaware on or before the Closing Date, and the Company shall have delivered to the Lead Investor evidence of such filing (including a file-stamped copy of the Restated Certificate or confirmation of filing from the Delaware Secretary of State's office).
Section 4.4 — Transaction Agreements.
The Company and each Investor (and, where applicable, the Key Holders and other parties thereto) shall have executed and delivered the following Transaction Agreements:
(a) this Agreement;
(b) the Investors' Rights Agreement, in the form attached hereto as Exhibit C, by and among the Company, the Investors, and the Key Holders;
(c) the Right of First Refusal and Co-Sale Agreement, in the form attached hereto as Exhibit D, by and among the Company, the Investors, and the Key Holders;
(d) the Voting Agreement, in the form attached hereto as Exhibit E, by and among the Company, the Investors, and the Key Holders;
(e) the Side Letter between the Company and Cobalt Ventures Fund III, LP, dated as of the Closing Date (the "Cobalt Side Letter"); and
(f) the Side Letter between the Company and Pinewood Health Ventures, LLC, dated as of the Closing Date (the "Pinewood Side Letter").
Section 4.5 — Board of Directors.
The Board of Directors of the Company shall, effective as of the Closing, consist of five (5) members, constituted as follows: