ACTUATE THERAPEUTICS INC

This section discusses the material components of the executive compensation program for our executive officers who are named in the “Summary Compensation Table” below. In 2024, our “named executive officers,” which consist of our principal executive officer and our two next most highly compensated executive officers during 2024, and their positions were as follows:

Summary Compensation Table

The following table sets forth information concerning the compensation of the named executive officers for the years ended December 31, 2024 and 2023.

Narrative to Summary Compensation Table

For the years ended December 31, 2024 and 2023, the compensation program for our named executive officers consisted of base salary and incentive compensation delivered in the form of cash bonuses and equity awards. Base salary was set at a level that was commensurate with the executive’s duties and authorities, contributions, prior experience and sustained performance. Cash bonuses and equity awards were also set at a level that was commensurate with the executive’s duties and authorities, contributions, prior experience and sustained performance, in accordance with the employment or similar agreement with the executive. Following our IPO, we grant all equity awards under the terms of our 2024 Plan. Equity awards, including stock options, are not granted in anticipation of the release of material non-public information, and the release of material non-public information is not timed on the basis of stock option or equity grant dates. All stock options are granted with an exercise price per share that is no less than the fair market value of our common stock on the date of grant of such award.

We also provide benefits to our named executive officers on the same basis as we provide benefits to all of our employees, including health, dental and vision insurance.

Employment Agreements

Chief Executive Officer

On April 15, 2015, we entered into an employment agreement with Mr. Schmitt, which was amended on each of February 5, 2016, September 28, 2017, September 23, 2018, January 29, 2019, September 3, 2019, August 1, 2022, January 27, 2023, December 12, 2023, May 9, 2024 and March 11, 2025 (the “CEO Employment Agreement”), that provides a base salary equal to $400,000 per year, and the ability to earn an annual bonus of up to 50% of his base salary, 70% of which shall be payable upon achievement of certain milestones mutually agreed to between the Company and Mr. Schmitt and 30% of which shall be payable at the discretion of the Board. On March 10, 2025, the Board approved an increase to Mr. Schmitt’s annual base salary to $570,000 and bonus up to 55% of his base salary, contingent upon the Company raising at least $25 million in additional equity financing.

In addition, Mr. Schmitt will receive, with a grant date of April 1, 2025 and at an exercise price equal to the closing price of our common stock as of such date, stock option grants consisting of (1) a one-time grant of 4,285 stock options to reflect a catch-up of salary that would have been paid if his salary increase had taken effect on August 14, 2024, representing the IPO closing date (a “Base Pay True Up Grant”); (2) a one-time grant of 200,000 stock options to reflect a catch-up grant since no annual grants were made in 2024 (an “Equity True Up Grant,” and together with the Base Pay True Up Grant, the “Special Option Grant”); and (3) an annual grant of 66,503 stock options (an “Annual Option Grant”). The Special Option Grant will vest as to 25% on August 14, 2025 with the remaining 75% vesting in equal monthly installments during the 36 months thereafter and the Annual Grant will vest as to 25% on the first anniversary of the grant date with the remaining 75% vesting in equal monthly installments during the 36 months following the first anniversary of the grant date.

In the event the Company is sold on or before December 31, 2026 for cash in a transaction valued at or above $29.56 per share, immediately prior to the consummation of such transaction, Mr. Schmitt will also be (i) granted shares of common stock under the stock incentive plan of the Company that is then in effect equal to that number of shares that would bring his total ownership (including the shares he owned prior to calculation of the shares to be granted in the sale transaction) to 8.0% of the issued and outstanding shares of common stock immediately prior to the closing of such transaction on a fully diluted basis, and (ii) entitled to receive a cash bonus equal to 100% of his base salary. Further, in the event on or before December 31, 2026 the Company receives between $10,000,000 – $100,000,000 or more in gross revenue pursuant to certain licensing arrangements between the Company and any third party or another non- dilutive capital transaction, Mr. Schmitt will be (i) granted shares of common stock under the stock incentive plan of the Company that is then in effect equal to that number of shares that would bring his total ownership (including the shares he owned prior to calculation of the shares to be granted in the transaction) to 5.0 – 6.0% (depending on the geographic location from which such gross revenue is derived) of the issued and outstanding shares of common stock on a fully diluted basis, and (ii) entitled to receive a cash bonus equal to 25 – 50% of his base salary (depending on the geographic location from which such gross revenue is derived). These potential stock awards are subject to limits under the stock plan on the number of shares available for grant.

The CEO Employment Agreement also provided that if the Company closed a transaction or series of related transactions occurring on or before December 31, 2026 pursuant to which the Company issues and sells shares of its common or preferred equity securities in exchange for aggregate gross proceeds of more than $10,000,000, excluding any gross proceeds attributable to sales to Bios Partners L.P. or its affiliates, (a Qualified Financing), Mr. Schmitt would be granted restricted stock units entitling him, upon vesting, to shares of common stock equal to that number of shares that would bring his total ownership (including the shares he owned prior to calculation of the shares to be granted in the transaction) to 4.25 – 5.0% of the issued and outstanding shares of common stock on a fully diluted basis at the time of the transaction, depending on the per share price of the shares sold in such Qualified Financing. Upon the closing of our IPO on August 14, 2024, which was considered a Qualified Financing, Mr. Schmitt was granted an award of 544,111 restricted stock units, which vest as follows: (i) 50% will vest on the first anniversary of the IPO closing, and (ii) 50% will vest on the second anniversary of the IPO closing. In addition, such shares will vest immediately upon: (i) a change in control, (ii) termination of Mr. Schmitt’s employment by us without “cause,” (iii) termination of employment by Mr. Schmitt for “good reason,” or (iv) death or disability.

The severance amount payable to Mr. Schmitt upon his termination by the Company for any reason (other than Mr. Schmitt’s death, disability or for “cause”), or termination by Mr. Schmitt for “good reason,” is equal to one times his then current base salary (the CEO Standard Severance Benefits). Upon termination upon a change in control, and if Mr. Schmitt’s employment is terminated by the Company for any reason other than Mr. Schmitt’s death, disability or for “cause,” or termination by Mr. Schmitt for “good reason,” in any such case within the six months immediately preceding or the twelve months immediately following such change in control, Mr. Schmitt is entitled to a payment equal to one and one-half times his then current base salary reduced by the CEO Standard Severance Benefits to which he would be entitled.

Chief Operating Officer

Dr. Mazar assumed the role of Chief Operating Officer on April 1, 2022 pursuant to a consulting agreement, dated March 25, 2022 (the “COO Consulting Agreement”), which entitled him to compensation equal to $35,000 per month for serving in that role. On June 1, 2022, the COO Consulting Agreement was superseded by an employment agreement, which was amended on March 11, 2025 (the “COO Employment Agreement”) that provides for a base salary equal to $450,000 per year, the ability to earn an annual bonus of up to 50% of his base salary upon achievement of certain milestones mutually agreed to between the Company and Dr. Mazar, and a signing bonus equal to $200,000. Upon execution of the COO Employment Agreement, the Company granted to Dr. Mazar 40,395 shares of restricted common stock, 25% of which vested on the first anniversary of the grant date and the remaining 75% of which vest in equal monthly installments during the 36 months following the first anniversary of the grant date.

In addition, Dr. Mazar will receive, with a grant date of April 1, 2025 and at an exercise price equal to the closing price of our common stock as of such date, stock option grants consisting of (1) a one-time grant of 110,346 stock options as an Equity True Up Grant; and (2) an Annual Option Grant of 51,046 stock options. The Equity True Up Grant will vest as to 25% on August 14, 2025 with the remaining 75% vesting in equal monthly installments during the 36 months thereafter and the Annual Grant will vest as to 25% on the first anniversary of the grant date with the remaining 75% vesting in equal monthly installments during the 36 months following the first anniversary of the grant date.

In the event the Company is sold on or before December 31, 2026 for cash in a transaction valued at or above $29.56 per share, immediately prior to the consummation of such transaction, Dr. Mazar will also be granted shares of common stock under the stock incentive plan of the Company that is then in effect equal to that number of shares that would bring his total ownership (including the shares he owned prior to calculation of the shares to be granted in the sale transaction) to 2.0% of the issued and outstanding shares of common stock on the day immediately prior to the closing of such transaction on a fully diluted basis (subject to limits under the stock plan on the number of shares available for grant). The shares issued to Dr. Mazar in such transaction will be fully vested as of the date of grant. The severance amount payable to Dr. Mazar upon termination by the Company for any reason (other than Dr. Mazar’s death, disability or for “cause”), or termination by Dr. Mazar for “good reason,” is equal to 100% of his then current base salary plus reimbursement of the cost associated with his premiums for elected COBRA coverage up to $25,000 (the “COO Standard Severance Benefits”). Upon termination upon a change in control, and if Dr. Mazar’s employment is terminated by the Company for any reason (other than Dr. Mazar’s death, disability or for “cause”), or termination by Dr. Mazar for “good reason,” in any such case within the six months immediately preceding or the twelve months immediately following such change in control, Dr. Mazar is entitled to a payment equal to one times his then current base salary reduced by the COO Standard Severance Benefits to which he would be entitled.

Chief Financial Officer

On February 17, 2024, we entered into a consulting agreement with Mr. Lytle (the Interim CFO Agreement), that provided for a consulting fee equal to $20,000 per month for services of at least 20 hours per week. The Interim CFO Agreement was superseded by an employment agreement effective June 1, 2024, as amended on March 11, 2025 (the “CFO Employment Agreement”) that provides for a base salary equal to $360,000 per year, and the ability for Mr. Lytle to earn an annual bonus of up to 40% of his base salary upon achievement of certain milestones mutually agreed to between the Company and Mr. Lytle. On March 10, 2025, the Board approved an increase to Mr. Lytle’s annual base salary to $435,363, contingent upon the Company raising at least $25 million in additional equity financing.

In addition, Mr. Lytle will receive, with a grant date of April 1, 2025 and at an exercise price equal to the closing price of our common stock as of such date, stock option grants consisting of (1) a one-time grant of 1,900 stock options as a Base Pay True Up Grant; (2) a one-time grant of 39,999 stock options as an Equity True Up Grant; and (3) an Annual Option Grant of 49,394 stock options. The Special Option Grant will vest as to 25% on August 14, 2025 with the remaining 75% vesting in equal monthly installments during the 36 months thereafter and the Annual Grant will vest as to 25% on the first anniversary of the grant date with the remaining 75% vesting in equal monthly installments during the 36 months following the first anniversary of the grant date.

In the event the Company is sold on or before December 31, 2026 for cash in a transaction valued at or above $29.56 per share, immediately prior to the consummation of such transaction, Mr. Lytle will also be granted shares of common stock under the stock incentive plan of the Company that is then in effect equal to that number of shares that would bring his total ownership (including the shares he owned prior to calculation of the shares to be granted in the sale transaction) to 2.0% of the issued and outstanding shares of common stock on the day immediately prior to the closing of such transaction on a fully diluted basis (subject to limits under the stock plan on the number of shares available for grant). The shares issued to Mr. Lytle in such transaction will be fully vested as of the date of grant.

Upon the closing of our initial public offering, the Company granted Mr. Lytle options to purchase that number of shares of common stock equal to 1.0% of the Company’s issued and outstanding capital stock on a fully diluted basis as of such date, or 234,971 shares, 25% of which vest on June 1, 2025 and the remaining 75% of which vest in equal monthly installments during the 36 months following June 1, 2025.

The CFO Employment Agreement may be terminated by the Company or Mr. Lytle at any time, upon 30 days’ prior written notice thereof to the other party. The severance amount payable to Mr. Lytle upon termination by the Company for any reason (other than Mr. Lytle’s death, disability or for “cause”), or termination by Mr. Lytle for “good reason,” is equal to 50% of his then current base salary (the “CFO Standard Severance Benefits”). Upon termination upon a change in control, and if Mr. Lytle’s employment is terminated by the Company for any reason (other than Mr. Lytle’s death, disability or for “cause”), or termination by Mr. Lytle for “good reason,” in any such case within the six months immediately preceding or the twelve months immediately following such change in control, Mr. Lytle is entitled to a payment equal to 50% of his then current base salary reduced by the CFO Standard Severance Benefits to which he would be entitled.

Outstanding Equity Awards at Year End

The following table presents information regarding the outstanding stock options and restricted common stock awards held by the Company’s named executive officers at December 31, 2024.

Potential Payments upon Termination or Change in Control

Our named executive officers each have employment agreements with us, pursuant to which they are entitled to receive certain benefits upon qualifying termination. See the section “Employment Agreements” above for additional information regarding these benefits.

Clawback Policy

We have adopted a compensation recovery policy that is compliant with the Nasdaq Listing Rules, as required by the Dodd-Frank Act.

Director Compensation

The following table sets forth compensation earned during the year ended December 31, 2024 by each director who is not a named executive officer and served during the year ended December 31, 2024.

Director Compensation Program

In connection with our initial public offering, the Board established, based upon the recommendation of the compensation committee, a compensation program for the non-employee members of the Board. The compensation program is designed to align the directors’ compensation with our business objectives and the creation of stockholder value. The compensation committee and the Board expect to review non-employee director compensation periodically to ensure that such compensation remains competitive and enables us to recruit and retain qualified directors.

Under the non-employee directors’ compensation program, beginning upon the effectiveness of the registration statement for this offering, each non-employee director will receive an annual cash retainer and will receive cash fees for serving as chair or as a member of the audit, compensation or nominating and corporate governance committees, as follows:

In addition, each non-employee director, upon their initial appointment or election, and on an annual basis thereafter, will receive a grant of stock options under our 2024 Plan exercisable for 30,000 and 15,000 shares, respectively, with the initial grant vesting in three equal installments on the first, second, and third anniversary of the grant date, and with the annual grants vesting in full on the first anniversary of the grant date.