SCHEDULE: Indaptus Insider Boosts Stake, Agrees to Board Support

Michael J. Newman, a key insider at Indaptus Therapeutics, Inc., increased his beneficial ownership to 5.4% and entered into a voting agreement supporting board proposals.

Summary

• Michael J. Newman, the reporting person, beneficially owns 115,552 shares of Indaptus Therapeutics, Inc. common stock, representing 5.4% of the outstanding shares.
• This Schedule 13D Amendment No. 2 updates previous filings from August 13, 2021, and October 26, 2021.
• On December 22, 2025, Indaptus Therapeutics entered into a Securities Purchase Agreement with David E. Lazar for the sale of 300,000 shares of Series AA Convertible Preferred Stock and 700,000 shares of Series AAA Convertible Preferred Stock at $6.00 per share, totaling $6.0 million in gross proceeds.
• In connection with this, Dr. Newman entered into an employment modification agreement, receiving an equity settlement payment of 216,617 shares of Common Stock.
• On December 23, 2025, Newman was issued 52,204 shares of common stock in connection with the Modification Agreement.
• Dr. Newman also entered into a Voting Agreement, committing to vote his shares in favor of all board-recommended proposals at a special stockholders' meeting related to the Purchase Agreement.
• The Voting Agreement includes a one-year standstill provision, preventing Dr. Newman from acquiring more securities, soliciting proxies, or influencing management/board from the Proxy Effective Date.

Sentiment

Score: 7

Explanation: The filing indicates a successful capital raise providing $6.0 million in funding, which is positive for the company's operations. However, the use of convertible preferred stock and the standstill agreement for a key insider introduce potential future dilution and governance limitations, balancing the overall sentiment.

Positives

• Michael J. Newman, an insider, increased his beneficial ownership through an equity settlement, potentially signaling confidence in the company.
• The company secured $6.0 million in gross proceeds from the sale of preferred stock to David E. Lazar, providing capital for operations.
• A Voting Agreement ensures stockholder support from a significant insider for board proposals related to the capital raise, potentially streamlining corporate actions.

Negatives

• The standstill agreement restricts Michael J. Newman's ability to influence management or acquire more shares for one year, potentially limiting activist shareholder actions.
• The capital raise involves convertible preferred stock, which could lead to dilution for common stockholders upon conversion.

Risks

• Potential dilution for existing common stockholders if the Series AA and Series AAA Convertible Preferred Stock are converted.
• The standstill agreement limits the ability of a significant shareholder (Michael J. Newman) to challenge or influence management decisions for a year.
• The need for a capital raise through preferred stock might indicate ongoing funding requirements or challenges in securing non-dilutive financing.

Future Outlook

The company plans to call a special meeting of stockholders to secure approvals related to the Securities Purchase Agreement. A one-year standstill period for Michael J. Newman will commence from the Proxy Effective Date.

Management Comments

• "Reporting Person agreed, in his capacity as stockholder of the Company, following the Proxy Effective Date, to vote all of his shares of Common Stock in favor of all proposals recommended by the board of directors at a special meeting of stockholders to be called for the purpose of securing certain stockholder approvals in connection with the Purchase Agreement."
• "Reporting Person agreed that, for a period one (1) year from the Proxy Effective Date, Reporting Person, nor any of his representatives acting on his behalf, will in any manner, directly or indirectly... seek to control or influence the management, board of directors or policies of the Company."

Industry Context

This filing reflects a common practice in biotechnology or early-stage companies where capital raises are crucial for funding research and development. The issuance of preferred stock and the associated voting/standstill agreements are mechanisms to secure funding while managing shareholder influence, typical for companies in the clinical or pre-revenue stages.

Comparison to Industry Standards

• The capital raise through convertible preferred stock is a standard financing mechanism for growth-stage biotech companies, similar to how many pre-revenue or clinical-stage biotechs secure funding from institutional investors or strategic partners.
• The inclusion of a voting agreement and standstill provision is also common in such financing rounds, particularly when a significant investor or insider is involved, to ensure stability and alignment with the board's strategic direction, comparable to agreements seen in private equity investments or strategic partnerships in the pharmaceutical sector.
• The 5.4% beneficial ownership by an insider is a notable stake, though not uncommon for founders or key executives in smaller public companies.

Corporate Governance

Stakeholder Impact

• Shareholders: Potential dilution from convertible preferred stock. Voting agreement ensures stability for board-backed initiatives. Standstill agreement limits insider influence for a year.
• Company (Indaptus Therapeutics): Receives $6.0 million in capital to fund operations. Secures shareholder support for key transactions.
• Management/Board: Gains stability and support for strategic decisions related to the capital raise.

Next Steps

• A special meeting of stockholders will be called to secure certain stockholder approvals in connection with the Purchase Agreement.
• The Voting Agreement and standstill provisions will become effective upon the 'Proxy Effective Date' and last for one year from that date.

Key Dates

Recommendation

The capital raise provides necessary funding, which is a positive. However, the dilution risk from convertible preferred stock and the standstill agreement limiting a significant insider's influence create a balanced outlook. Without further details on the company's operational progress or the terms of the preferred stock conversion, a 'hold' recommendation is appropriate, suggesting investors maintain their current position while monitoring future developments.

Keywords

Indaptus Therapeutics, Michael J. Newman, Schedule 13D, Beneficial Ownership, Equity Settlement, Voting Agreement, Standstill Agreement, Preferred Stock, Capital Raise, SEC Filing, Corporate Governance, Shareholder Agreement