SCHEDULE: Terrestrial Energy CTO LeBlanc Discloses 9.7% Stake

Terrestrial Energy Inc.'s Chief Technology Officer, David LeBlanc, has disclosed a 9.7% beneficial ownership stake in the company following a recent business combination.

Summary

• David LeBlanc, Chief Technology Officer and Director of Terrestrial Energy Inc., beneficially owns 11,400,410 shares of Common Stock, representing 9.7% of the class.
• The shares were acquired through a Business Combination Agreement that closed on October 28, 2025, involving the merger of HCM II Acquisition Corp. (now Terrestrial Energy Inc.) and Legacy Terrestrial.
• LeBlanc's ownership includes 11,175,778 ExchangeCo Shares, 145,464 shares from vested or vesting stock options, 17,882 shares from exercisable warrants, and shares held by an entity owned by his wife.
• He has sole voting power over 8,386,018 shares and shared voting power over 3,014,391 shares due to a Voting Co-ordination Agreement with CEO Simon Irish.
• The stated purpose of the acquisition is for investment and as an incentive for his employment.
• LeBlanc is subject to a Lock-Up Agreement restricting share transfers for up to one year, with partial and full releases tied to the stock's volume-weighted average price (VWAP) reaching $15.00 and $20.00, respectively, after 180 days.

Sentiment

Score: 7

Explanation: The filing indicates strong alignment of a key executive's interests with the company through a significant ownership stake and an investment-oriented purpose. The lock-up agreement provides stability, though the voting agreement centralizes some control. Overall, it suggests confidence from a core insider.

Positives

• A significant ownership stake (9.7%) by a key executive (CTO and Director) aligns management's interests with shareholders.
• The acquisition is for investment purposes and to incentivize employment, indicating confidence in the company's future.
• The Lock-Up Agreement provides stability by preventing immediate large-scale selling by a key insider post-merger, aligning long-term interests.

Negatives

• The Voting Co-ordination Agreement grants the CEO, Simon Irish, control over a portion of LeBlanc's voting power (3,014,391 shares), potentially centralizing voting influence.
• The Lock-Up Agreement restricts LeBlanc's ability to sell shares for up to one year, which could limit liquidity for the reporting person.

Risks

• The Lock-Up Agreement's share release conditions are tied to the stock's VWAP reaching $15.00 and $20.00, meaning the shares may remain locked up if these price targets are not met.
• The concentration of voting power between the CTO and CEO, as per the Voting Co-ordination Agreement, could reduce the influence of other shareholders on certain matters.

Future Outlook

The filing indicates LeBlanc's intention to hold his shares for investment purposes and as an incentive for his employment. He reserves the right to buy or sell additional securities or formulate future plans, subject to existing agreements and company policies.

Management Comments

• "The Reporting Person acquired the shares reported herein for investment purposes and to incentivize him in connection with his employment with the Issuer."
• "The Reporting Person serves as Chief Technology Officer of the Issuer and as a member of the Issuer's Board of Directors and, in such capacities, may have influence over the corporate activities of the Issuer."
• "The Reporting Person reserves the right to formulate in the future plans or proposals that may relate to or result in the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D."

Industry Context

This filing reflects a common outcome of a business combination (likely a SPAC merger, as HCM II Acquisition Corp. was formerly a SPAC) where founders/executives of the acquired company receive shares in the new public entity. The lock-up agreement and voting agreement are typical mechanisms to ensure stability and align interests post-merger, particularly for key management. Terrestrial Energy is involved in nuclear energy, specifically molten salt reactors, an industry with significant long-term potential but also high capital requirements and regulatory hurdles.

Comparison to Industry Standards

• The 9.7% beneficial ownership by a CTO is a substantial stake, often seen as a positive indicator of management commitment, comparable to founder-led companies in high-growth or capital-intensive sectors.
• Lock-up agreements for key holders post-merger (especially SPACs) are standard practice, typically ranging from 6 months to 1 year, with price-based release triggers also common to incentivize performance. The 1-year lock-up with $15 and $20 VWAP triggers is within industry norms for post-SPAC transactions.
• Voting co-ordination agreements among key executives, while less common than lock-ups, can be found in companies where founders or early investors seek to maintain a unified voting bloc, similar to dual-class share structures or shareholder agreements in private companies transitioning to public. This is particularly relevant in industries requiring long-term strategic vision and stability, like nuclear energy development.

Corporate Governance

Related Party Transactions

• Shares held by M. Denis-LeBlanc Medecine Societe Professionelle (MSP), an entity owned by the Reporting Person's wife, are included in the beneficial ownership calculation.
• The Voting Co-ordination Agreement is between David LeBlanc and Simon Irish, both key executives of the Issuer.

Stakeholder Impact

• Shareholders: The significant insider ownership and lock-up agreement may be viewed positively as aligning management's interests with long-term shareholder value. However, the voting agreement centralizes some voting power, potentially reducing the influence of other shareholders.
• Management/Employees: The shares serve as an incentive for LeBlanc's employment, potentially boosting morale and commitment among key personnel.

Next Steps

• LeBlanc may, from time to time, purchase additional securities of the Issuer or dispose of existing investments, subject to the Lock-Up Agreement and Insider Trading Policy.
• The Lock-Up Agreement will expire or allow for partial/full release of shares based on time (180 days, 1 year) and stock price performance ($15.00 and $20.00 VWAP).
• The Voting Co-ordination Agreement will continue until either LeBlanc or Irish beneficially owns less than 450,000 shares or by mutual written agreement.

Key Dates

Recommendation

This Schedule 13D filing primarily discloses the beneficial ownership of a key executive, David LeBlanc, following a business combination, along with associated lock-up and voting agreements. His substantial 9.7% stake, acquired for investment and incentive purposes, signals strong insider confidence and aligns his interests with long-term shareholder value. The lock-up agreement provides stability by restricting immediate share sales. However, the voting agreement centralizes some control with the CEO. Without new operational or financial performance data, the filing reinforces a stable insider position but does not present new catalysts for a strong buy or sell. Therefore, a 'hold' recommendation is appropriate, awaiting further operational updates.

Keywords

Terrestrial Energy Inc., David LeBlanc, Schedule 13D, Beneficial Ownership, Common Stock, Business Combination, Merger, Voting Agreement, Lock-Up Agreement, CTO, Director, Investment, Shareholder, Corporate Governance