If elected, respectively, these nominees will serve until our 2024 Annual Meeting of Stockholders or until successors have been duly elected and qualified. Our board of directors believes that all of our current directors, including the seven nominees for election, possess personal and professional integrity, good judgment, a stockholderhigh level of record or beneficially in street name, you may vote without attending the Special Meeting. You may vote by granting a proxy or, for shares held in street name, by submitting voting instructions to your broker or nominee. To vote by proxy, please follow the instructions on the enclosed proxy card.ability and business acumen.

If you votea quorum is present, the Company Nominees will be elected by proxy, your sharesa plurality of the votes cast at the Annual Meeting. Abstentions and broker non-votes have no effect on the vote. The seven Company Nominees receiving the highest number of affirmative votes will be elected directors of the Company. Shares of voting stock represented by executed proxies will be voted, if authority to do so is not withheld, for the election of the seven nominees named below. Should any Company Nominee become unable or unwilling to accept nomination or election, the proxy holders may vote the proxies for the election, in his or her stead, of any other person the Board may nominate or designate. Each Company Nominee has agreed to serve, if elected, and the Board has no reason to believe that any Company Nominee will be unable to serve.

The Board and the Nominating and Corporate Governance Committee continue to frequently evaluate the optimal size and composition of the Board to allow it to operate nimbly and efficiently, while maintaining new ideas, expertise, experience and diversity among its membership. As of April 28, 2023, a female comprises approximately 14% of our Board and black or African American male comprises approximately 14% of our Board.

The biographies of the Company Nominees are as follows:

Yaacov (Kobe) Nagar. Mr. Nagar is a co-founder of 374Water and patent inventor of the supercritical water oxidation AirSCWO™ system. He has been the Chief Executive Officer of 374Water from inception in July 2018 and the Chairperson of the Board since the Merger. Mr. Nagar holds degrees in chemical engineering from Ben Gurion University (2001) and material engineering from Tel-Aviv University (2007) and thereafter held positions in the defense industry and renewable energy sectors in Israel, where he worked on developing fuel cell, CO2 sequestration and low energy chemicals technologies. He joined the Bill and Melinda Gates Foundation project at Duke University in 2017 to scale up and commercialize the SCWO technology.

Richard H. Davis. Mr. Davis joined our board in February 2008, and served as the Chief Executive Officer from August 2011 to April 2021. He received a B.S degree in economics from Florida State University in 1982. He joined First Equity Corporation (“First Equity”) in Miami that same year. First Equity operated as a regional full-service brokerage and investment bank. Mr. Davis’ duties included equity deal structure and brokerage-related activities. After First Equity was acquired in 2001, Mr. Davis joined the corporate finance department of William R. Hough & Company (“Hough”), where he continued structuring equity finance and private acquisitions. Hough was acquired in 2004 by RBC Dain Rauscher (“Dain”), a global investment banking firm. Dain consolidated Hough’s corporate finance activities into its New York offices. Mr. Davis elected to remain in Miami and joined Martinez-Ayme Securities (“MAS”), assuming the newly-created position of managing director of corporate finance. In 2005, Mr. Davis resigned from MAS and ceased working as an investment banker.

Terry Merrell. Mr. Merrell is a co-founder of Merrell Bros., Inc. (“Merrell”), Kokomo, Indiana, where he has served as the Chief Financial Officer since inception in 1982. He also is the founder of Cross America, Inc. which is a non-profit organization where he has served as President since 2018. He also serves as Elder at Upper Deer Creek Church. He has developed several technologies related to the biosolids management and disposal industry and currently has a patent pending status on some of these technologies.

Deanna Rene Estes.  Since September 2016, Ms. Estes has served as the Finance Manager of 10 Branch Management LLC, a private entity which governs the Jay and Renee Haladay Family Office, where she has established the mission, governance, policy, procedures, systems and reporting for the family offices which handles the investment and other affairs of five families.  For more than fifteen years, Ms. Estes has partnered with investors, entrepreneurs, financiers, developers, and operators to achieve economic success for ventures in multiple industries and, at times, extreme market conditions.  Ms. Estes received her BA in Business Administration with a Major in Finance from Washington State University. 

Buddie Joe (BJ) Penn.  Since January 2013, Mr. Penn has served as the Chief Executive Officer of Genesis IV, an executive consulting firm and Penn Construction Group, both headquartered in the Washington D.C. Metro area.  Mr. Penn was Acting Secretary of the US Navy from March to May 2009, having previously been Assistant Secretary of the US Navy (Installations and Environment) since 2005. He began his career as a Naval Aviator and was named EA-6B Pilot of the Year in 1972. Throughout his distinguished career, significant leadership assignments included: Executive Officer/Commanding Officer VAQ 33, Battalion Officer at the US Naval Academy, Air Officer in USS America, Special MeetingAssistant to the Chief of Naval Operations, Commanding Officer of NAS North Island, CA, and Deputy Director of the Navy Office of Technology Transfer & Security Assistance. Mr. Penn left the Navy in 1995, joining Loral Corporation as Director of International Business. In 1996, Loral sold its defense electronics and system integration businesses to Lockheed Martin and Mr. Penn was assigned to Lockheed Martin’s Corporate Staff. Mr. Penn returned to the manner you indicate. If you vote by mailUS Navy in 2001 as Director of Industrial Base Assessments.

Mr. Penn received his BS in Industrial Technology from Purdue University and return a signed proxy card with no specific instructions, your shares will be votedhis MS in Human Resource Management & Personnel Administration from The George Washington University. Mr. Penn serves on the Secretary of Defense Policy Board, as Trustee Emeritus at The George Washington University and the Boards of the National Trust for the Humanities, Naval Aviation Museum and Naval Historical Foundation. Mr. Penn also serves as the Chairman of the Board of Directors recommends.Spectra System Corporation, a London Stock Exchange listed company (SPSY) and on the Board of Directors of Healthcare Trust Inc., a Nasdaq listed company (HTIA).

Can I change my vote after I submit my proxy?Yizhaq (Itzik) Polad. Since March 2023, Mr. Polad has served as the Vice President of Data of LSports data Ltd, a private company headquartered in Ashkelon, Israel focused on the sports data industry and creating unique technologies in order to provide business advantages to its partners, where he oversees the data engineering, data analytics, insights and value to business and customers. From August 2019 to March 2023, Mr. Polad served as the Vice President of BI and Business Applications at Papaya Global, a private SaaS company headquartered in New York, New York, where he led its business intelligence and data analytics products and the scaling of its data infrastructure. Mr. Polad previously held a number of positions in Hewlett Packard from September 2006 until January 2019 and assisted its Indigo division in its rapid growth by implementing information systems, business applications, data analytics and business intelligence. Mr. Polad holds a B.Sc degree in Industrial Engineering, Information Systems & Management as well as an MBA degree, both from Ben-Gurion University located in Israel.

Yes. You can change or revoke your proxy at any time before it is voted by submitting another proxyJames M. Vanderhider. Since December 2018, Mr. Vanderhider has served as President of Aspen View GP, LLC. Previously, Mr. Vanderhider served as a Principal, Executive Vice President and Chief Financial Officer of EnerVest, Ltd. from 1996 until 2018. He was responsible for building EnerVest's private equity business and for the oversight of the institutional investments. During such tenure, he led initiatives for raising over $8 billion of private equity and over $12 billion of total institutional capital, securing over 150 institutional investors. Such investors included a diversified group of pension funds, endowments, foundations, family offices, insurance companies, fund of funds, international investors and other financial institutions.

Mr. Vanderhider currently serves as President of the Foundation of Goodwill Industries of Houston, along with serving on the Audit Committee of Goodwill Industries of Houston. During 2019, he joined the Advisory Board of Midway Companies, a privately owned, multi-billion dollar fully integrated real estate development and investment firm based in Houston, Texas. During January, 2022 he joined the Board of Directors of Scranton Holding Company, a private start-up venture in Hibbing, Minnesota, with a later date. You may also sendmission to become the only dedicated US producer of merchant pig iron and conducting operations leading to clean steel production through a written noticecarbon neutral, ESG-focused process. Mr. Vanderhider holds a BA of revocation to Vyrex Corporation, 2159 Avenida de la Playa, La Jolla, California 92037, Attention: Mr. G. Dale Garlow, President.Business Administration degree in Accounting from Texas A&M University and is a Certified Public Accountant.

Family Relationships

1

Can I vote in person at the Special Meeting instead of voting by proxy?Family Relationships

Yes. However, we encourageThere are no family relationships among any of 374Water’s directors or executive officers.

Required Vote and Board Recommendation

If a quorum is present and voting, the seven Company Nominees receiving the highest number of votes will be elected as directors. If you hold your shares in your own name and abstain from voting on the election of directors, your abstention will have no effect on the vote. If you hold your shares through a broker and you do not instruct the broker on how to vote for the seven Company Nominees, your broker will not have the authority to vote your shares at your earliest convenience to ensure that your shares are representedshares. Abstentions and voted. If you vote your shares by proxy and later decide you would like to attend the meeting and vote your shares in person, youbroker non-votes will need to provide a written notice of revocation to the secretary of the meeting before your proxy is voted.

How are votes counted?

Except as noted, all proxies received willeach be counted inas present for purposes of determining whether a quorum exists and whether we have obtained the necessary numberpresence of votes on each proposal. An abstention from voting will be used for the purpose of establishing a quorum, and will be considered a vote “against” a proposal. A broker non-vote will also be used for the purpose of establishing a quorum but will not otherwise be counted in the voting process. Thus, broker non-votes will not affecthave any effect on the outcome of the vote.

CORPORATE GOVERNANCE

374Water, with the oversight of the Board and its committees, operates within a comprehensive plan of corporate governance for the purpose of defining independence, assigning responsibilities, setting high standards of professional and personal conduct and assuring compliance with such responsibilities and standards. We regularly monitor developments in the area of corporate governance.

Code of Business Conduct and Ethics

We have adopted a Code of Business Conduct and Ethics that applies to our officers, directors and employees, including our principal financial officer and principal accounting officer. The Code of Business Conduct and Ethics addresses, among other things, conflicts of interest, protection and proper use of Company assets, government relations, compliance with laws, rules and regulations and the process for reporting violations of the Code of Business Conduct and Ethics, improper conflicts of interest or other violations. Our Code of Business Conduct and Ethics is available on our website at www.374water.com in the “Governance Documents” section found under the “Investors” tab. We intend to disclose any future amendments to certain provisions of the Code of Business Conduct and Ethics, or waivers of such provisions granted to executive officers and directors, on this website within four business days following the date of any such amendment or waiver.

Board Composition

Our Certificate of Incorporation, as amended, and our Bylaws (“Bylaws”) provide that our Board will consist of one or more members, such number of directors to be determined from time to time pursuant to a resolution adopted by a majority of the total number of authorized directors. Vacancies or newly created directorships resulting from an increase in the authorized number of directors elected by all of the stockholders having the right to vote as a single class may be filled by a majority of the directors then in office, although less than a quorum, or by a sole remaining director.

We have no formal policy regarding Board diversity. Our Board believes that each director should have a basic understanding of the principal operational and financial objectives and plans and strategies of the Company, our results of operations and financial condition and relative standing in relation to our competitors. We take into consideration the overall composition and diversity of the Board and areas of expertise that director nominees may be able to offer, including business experience, knowledge, abilities and customer relationships. Generally, we will strive to assemble a Board that brings to us a variety of perspectives and skills derived from business and professional experience as we may deem are in our and our stockholders’ best interests. In doing so, we will also consider candidates with appropriate non-business backgrounds.

Director Independence

Our common stock currently trades on The Nasdaq Capital Market under the symbol “SCWO”.  Under the rules of Nasdaq, independent directors must comprise a majority of a listed company’s board of directors, subject to certain phase-in periods available to companies that do not yet have a class of common stock registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition, Nasdaq rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation and corporate governance and nominating committees be independent.

Our board of directors has undertaken a review of the composition of our board of directors, our committees and the independence of each director. Based upon information requested from and provided by each director concerning their background, employment and affiliations, including family relationships, the board of directors has determined that Messrs. Penn, Polad and Vanderhider and Ms. Estes are “independent” as that term is defined under applicable Nasdaq rules.

In making these determinations, the board of directors considered the current and prior relationships that Messrs. Penn, Polad and Vanderhider and Ms. Estes has with us and all other facts and circumstances the board of directors deemed relevant in determining his independence, including the beneficial ownership of capital stock by that Messrs. Penn, Polad and Vanderhider and Ms. Estes.

Board Committees, Meetings and Attendance

During 2022, the Board held thirteen meetings. We expect our directors to attend Board meetings, meetings of any committees and subcommittees on which they serve and each annual meeting of stockholders. During 2022, we had no incumbent director who attended fewer than 75% of the total number of meetings held by the Board and Board committees of which such director was a member.

We encourage our Board members to attend the annual meeting. This will be our first ever annual meeting.

The Board delegates various responsibilities and authority to different Board committees. Committees regularly report on their activities and actions to the full Board. Currently, the Board has established an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. Committee assignments are re-evaluated annually. Each of these committees operates under a charter that has been approved by our Board.

As of April 28, 2023, the following table sets forth the membership of each of the Board committees listed above.

Audit Committee

Our audit committee is currently comprised of Messrs. Penn, Polad and Vanderhider, each of whom our board has determined is financially literate and qualifies as an independent director under Section 5605(a)(2) and Section 5605(c)(2) of the Nasdaq rules. Mr. Vanderhider is the Chairperson of our audit committee and Mr. Vanderhider qualifies as an audit committee financial expert, as defined in Item 407(d)(5)(ii) of Regulation S-K.

Our audit committee has adopted a written audit committee charter, viewable at https://374water.com/investor-relations/corporate governance/, that provides that the functions of our audit committee include, among other things:

Compensation Committee

Our compensation committee is currently comprised of Messrs. Penn and Polad. Our board has determined that each of Messrs. Penn and Polad qualifies as an independent director under Section 5605(a)(2) of the Nasdaq rules and a “non-employee director” for purposes of Section 16b-3 under the Exchange Act and does not have a material relationship with us that would affect his ability to be independent from management in connection with the duties of a compensation committee member, as described in Section 5605(d)(2) of the Nasdaq rules. Mr. Polad is the Chairperson of our compensation committee.

Our compensation committee has adopted a written compensation committee charter, viewable at https://374water.com/investor-relations/corporate governance/, that provides that the functions of our compensation committee include, among other things:

Nominating and Corporate Governance Committee

Our nominating and corporate governance committee is currently comprised of Messrs. Penn and Polad. Our board has determined that each of Messrs. Penn and Polad qualifies as an independent director under Section 5605(a)(2) of the Nasdaq rules. Mr. Penn is the Chairperson of our nominating and corporate governance committee.

Our nominating and corporate governance committee has adopted a written nominating and corporate governance committee charter, viewable at https://374water.com/investor-relations/corporate governance/, that provides that the functions of our nominating and corporate governance committee include, among other things:

Director Nominations

Our Nominating and Corporate Governance Committee considers all qualified candidates identified by members of the Board, by senior management and by stockholders. The Nominating and Corporate Governance Committee follows the same process and uses the same criteria for evaluating candidates proposed by stockholders, members of the Board and members of senior management. We did not pay fees to any third party to assist in the process of identifying or evaluating director candidates during 2022 nor during 2023 thus far.

To recommend a nominee for election to the Board, a stockholder must submit his or her recommendation to our Secretary at our corporate offices at 3710 Shannon Rd., Suite 51877, Durham, North Carolina 27717. Such nomination must be received by us prior to the date set forth under “Stockholder Proposals” below. A stockholder’s recommendation must be accompanied by certain information with respect to stockholder nominees as specified, including among other things, the name, age, address and occupation of the recommended person, the proposing stockholder’s name and address, the ownership interests of the proposing stockholder and any beneficial owner on whose behalf the nomination is being made (including the number of shares beneficially owned, any hedging, derivative, short or other economic interests and any rights to vote any shares) and any material monetary or other relationships between the recommended person and the proposing stockholder and/or the beneficial owners, if any, on whose behalf the nomination is being made.

In evaluating director nominees, the Nominating and Corporate Governance Committee considers the following factors:

Our Board believes that each director should have a basic understanding of our principal operational and financial objectives and plans and strategies, our results of operations and financial condition and our relative standing in relation to our competitors.

In identifying director nominees, the Board will first evaluate the current members of the Board willing to continue in service. Current members of the Board with skills and experience that are relevant to our business and who are willing to continue in service will be considered for re-nomination.

If any member of the Board does not wish to continue in service or if the Board decides not to re-nominate a member for re-election, the Board will identify another nominee with the desired skills and experience described above. The Board takes into consideration the overall composition and diversity of the Board and areas of expertise that director nominees may be able to offer, including business experience, knowledge, abilities and customer relationships. Generally, the Board will strive to assemble a Board that brings to us a variety of perspectives and skills derived from business and professional experience as it may deem are in our and our stockholders’ best interests. In doing so, the Board will also consider candidates with appropriate non-business backgrounds.

Communications with Directors

The Board welcomes communication from our stockholders. Stockholders and other interested parties who wish to communicate with a member or members of our Board or a committee thereof may do so by addressing correspondence to the Board member, members or committee, c/o Secretary, 374Water Inc. 3710 Shannon Rd., Suite 51877, Durham, North Carolina 27717. Our Secretary will review and forward correspondence to the appropriate person or persons.

All communications received as set forth in the preceding paragraph will be opened by our Secretary for the sole purpose of determining whether the contents represent a message to our directors. Any contents that are not in the nature of advertising, promotions of a product or service or patently offensive material will be forwarded promptly to the addressee(s). In the case of communications to the Board or any group or committee of directors, our Secretary will make sufficient copies of the contents to send to each director who is a member of the group or committee to whom the communication is addressed. If the amount of correspondence received through the foregoing process becomes excessive, our Board may consider approving a process for review, organization and screening of the correspondence by our Secretary or another appropriate person.

Involvement in Certain Legal Proceedings

There have been no material legal proceedings that would require disclosure under the federal securities laws that are material to an evaluation of the ability or integrity of our directors or executive officers, or in which any director, officer, nominee or principal stockholder, or any affiliate thereof, is a party adverse to us or has a material interest adverse to us.

DIRECTOR COMPENSATION

During the period of December 31, 2022, non-employee members of our board of directors were compensated as follows:

⁽¹⁾Represents an option to purchase up to 20,000 shares of common stock to purchase which was granted on June 13, 2022 and vests in four equal quarterly share installments at the end of each quarter beginning on September 30, 2022 with a per share exercise price of $3.00. Each must be a member of the Board of Directors of the Issuer as of each vesting date. These options expire on June 12, 2032

Equity Compensation

For fiscal 2023, we have not yet determined the compensation level for our non-employee members of the Board of Directors.

Indemnification of Directors and Officers

Our Certificate of Incorporation allows us to indemnify our present and former officers and directors and other personnel against liabilities and expenses arising from their service to the full extent permitted by Delaware law. The persons indemnified include our (i) present or former directors or officers, (ii) any person who while serving in any of the matters being voted oncapacities referred to in clause (i) who served at our request as a director, officer, partner, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, and (iii) any person nominated or designated by (or pursuant to authority granted by) our Board of Directors or any committee thereof to serve in any of the Special Meeting. Generally, broker non-votes occur when shares heldcapacities referred to in clauses (i) or (ii).

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information about beneficial ownership of our common stock as of April 17, 2023, (unless otherwise noted) by (i) each stockholder that has indicated in public filings that the stockholder beneficially owns more than five percent of the common stock, (ii) each of the Company’s directors and named officers and (iii) all directors and officers as a broker for a beneficial owner are not votedgroup. Except as otherwise noted, each person listed below, either alone or together with members of the person’s family sharing the same household, had, to our knowledge, sole voting and investment power with respect to a particular proposal because (i) the broker has not received voting instructions fromshares listed next to the beneficial owner and (ii) the broker lacks discretionary voting power to vote suchperson’s name.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

How manyIn addition to the compensation arrangements with our directors and executive officers, including those discussed in the sections titled “Management” and “Executive Compensation,” the following is a description of each transaction since January 1, 2019 and each currently proposed transaction in which:

Agreement with Merrell Bros.

On July 7, 2021, 374Water Systems Inc. (“374Water”), a subsidiary of 374Water Inc. (the “Company”) entered into a Manufacturing and Service Agreement (the “Manufacturing and Service Agreement”) with Merrell Bros. Fabrication, LLC (“Merrell Bros.”) pursuant to which Merrell Bros. will manufacture, supply and service AirSCWO supercritical water oxidation products for 374Water. Subject to certain termination rights, the Manufacturing and Service Agreement is for an initial period of three years and will renew for successive one-year periods thereafter. Under the Manufacturing and Service Agreement, Merrell Bros. will be 374Water’s exclusive supplier and service provider with respect to the products in the United States and Canada.

As of December 31, 2022, we have incurred $1,318,117 in expenses relating to the Manufacturing and Service Agreement and  there is an accounts payable of $559,481 relating to the Manufacturing and Service Agreement.

Terry Merrell, one of the Merrell Bros, is a member of our Board. 

Related-Party Transaction Policy

Our audit committee charter that gives our audit committee the primary responsibility for reviewing and approving or disapproving “related-party transactions,” which are generally transactions between us and related persons in which the aggregate amount involved exceeds or may be expected to exceed $120,000 and in which a related person has or will have a direct or indirect material interest. The written charter of our audit committee provides that our audit committee shall review and approve in advance any related-party transaction.

In approving or rejecting any related party transactions, our audit committee considers the relevant facts and circumstances available and deemed relevant to our audit committee, including whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related person’s interest in the transaction.

Prior to the formation of our audit committee, our entire board of directors has been responsible for approving related-party transactions. The transactions described above were approved by our board of directors.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and officers, and persons who own more than ten percent of our common stock, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock. To our knowledge, based solely on a review of the copies of such reports furnished to us, during the fiscal year ended December 31, 2022, we believe that all filing requirements applicable to our officers, directors and greater than ten percent stockholders were complied with for the fiscal year ended December 31, 2022.

EXECUTIVE COMPENSATION

Compensation Philosophy and Practices

We believe that the performance of our executive officers significantly impacts our ability to achieve our corporate goals. We, therefore, place considerable importance on the design and administration of our executive officer compensation program. This program is intended to enhance stockholder value by attracting, motivating and retaining qualified individuals to perform at the highest levels and to contribute to our growth and success. Our executive officer compensation program is designed to provide compensation opportunities that are tied to individual and corporate performance.

Our compensation packages are also designed to be competitive in our industry. The Compensation Committee from time-to-time consults with other advisors in designing our compensation program, including in evaluating the competitiveness of individual compensation packages and in relation to our corporate goals.

Our overall compensation philosophy has been to pay our executive officers an annual base salary and to provide opportunities, through cash and equity incentives, to provide higher compensation if certain key performance goals are satisfied.

The main principles of our fiscal year 2022 compensation strategy included the following:

Executive Officers

The following table sets forth the names, ages and positions of our executive officers and certain significant employees as of , December 31, 2022 and currently:

The affirmative vote of the holders of a majority of the shares of our voting securities represented in person or by proxy at the Annual Meeting entitled to vote on such proposal that vote for or against such proposal is required to approve each proposal?the advisory vote on executive compensation. This is a non-binding advisory vote.

PROPOSAL 3: ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES ON EXECUTIVE COMPENSATION

The Dodd-Frank Act also provides that stockholders must be given the opportunity to vote, on a non-binding, advisory basis, for their preference as to how frequently we should seek future advisory votes on the compensation of our named executive officers as disclosed in accordance with the compensation disclosure rules of the SEC, which we refer to as an advisory vote on executive compensation. By voting with respect to this proposal, stockholders may indicate whether they would prefer that we conduct future advisory votes on executive compensation once every one, two, or three years. Stockholders also may, if they wish, abstain from casting a vote on this proposal.

The board of directors believes that a frequency of “every three years” for the advisory vote on executive compensation is the optimal interval for conducting and responding to a “say on pay” vote. In determining to recommend that stockholders vote for a frequency of once every three years, the board considered how an advisory vote at this frequency will provide our stockholders with sufficient time to evaluate the effectiveness of our overall compensation philosophy, policies and practices in the context of our long-term business results for the corresponding period, while avoiding over-emphasis on short-term variations in compensation and business results. An advisory vote occurring once every three years will also permit our stockholders to observe and evaluate the impact of any changes to our executive compensation policies and practices that have occurred since the last advisory vote on executive compensation, including changes made in response to the outcome of a prior advisory vote on executive compensation. We will continue to engage with our stockholders regarding our executive compensation program during the period between advisory votes on executive compensation. Stockholders who have concerns about executive compensation during the interval between “say on pay” votes are welcome to bring their specific concerns to the attention of the board of directors. Please refer to “Corporate Governance—Communications with the Board of Directors” in this Proxy Statement for information about communicating with the board.

Although this advisory vote on the frequency of the “say on pay” vote is non-binding, the board of directors and the compensation committee will take into account the outcome of the vote when considering the frequency of future advisory votes on executive compensation.

Vote Required

For the advisory vote on how frequently our stockholders should vote on the compensation of our named executive officers, the number of years (1, 2 or 3) that receives the highest number of votes will be deemed to be preferred by our stockholders. This is a non-binding advisory vote.

PROPOSAL 4: RATIFICATION OF THE APPOINTMENT OF CHERRY BEKAERT LLP AS OUR

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE 2023 FISCAL YEAR

The Audit Committee of the Board has selected Cherry Bekaert LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023, and the Board has directed that management submit the selection of independent registered public accountants for ratification by the stockholders at the Annual Meeting.

Stockholder ratification of the selection of Cherry Bekaert LLP as our independent registered public accounting firm is not required by our Bylaws or otherwise. However, the Board is submitting the selection of Cherry Bekaert LLP to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not to retain Cherry Bekaert LLP Even if the selection is ratified, the Audit Committee, at its discretion, may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the Company and its stockholders.

Required Vote and Board Recommendation

The affirmative vote of a majority of the shares present in personcast for or represented by proxy and entitled to vote atagainst the Special Meetingproposal is required to approve eachratify the appointment of Cherry Bekaert LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2023. If your shares are held by a broker and you do not give the broker specific instructions on how to vote your shares, your broker may vote your shares at its discretion. Abstentions will have no effect on the outcome of the proposals.

As of September 2, 2005, our executive officers and directors held of record or beneficially approximately 2,006,570 shares, or 23.6%, of our issued and outstanding common stock. Our executive officers and directors have indicated their intention to vote “for” each of the proposals described inon this proxy statement.

Who pays for this proxy solicitation?

We will pay the cost of soliciting proxies for the Special Meeting, including the costs of preparing, assembling and mailing the proxy materials. We will provide copies of proxy materials to fiduciaries, custodians and brokerage houses to forward to the beneficial owners of shares held in their name. We may reimburse such fiduciaries, custodians and brokers for their costs in forwarding the proxy materials.

In addition to the solicitation of proxies by mail, certain of our officers and other employees may also solicit proxies personally or by telephone, facsimile, telegram or other means. No additional compensation will be paid to these individuals for any such services. We have also retained Mellon Investor Services LLC to help us solicit proxies for an estimated fee of approximately $4,500.

2

STOCK HOLDINGS OF CERTAIN OWNERS AND MANAGEMENT

The following table sets forth information on the beneficial ownership of our common stock by executive officers and directors, as well as stockholders who are known by us to own beneficially more than 5% of our common stock, as of September 7, 2005.proposal.

From time to time, the number of our shares held in the “street name” accounts of various securities dealers for the benefit of their clients or in centralized securities depositories may exceed 5% of the total shares of our common stock outstanding.

3

PROPOSAL 1

APPROVAL OF AN AGREEMENT AND PLAN OF MERGER TO CHANGE THE COMPANY’S STATE OF INCORPORATION FROM NEVADA TO DELAWARE

Introduction

For the reasons set forth below, our Board of Directors (“Board”) has determined that it would be in the best interests of the Company and its stockholders to change the state of incorporation of the Company from Nevada to Delaware. Accordingly, the Board has approved the incorporation of a wholly-owned subsidiary of the Company in the state of Delaware and the subsequent merger of the Company with and into the subsidiary, in which the subsidiary will acquire all of the assets and assume all of the liabilities of the Company and shall be the surviving corporation (“Proposed Reincorporation”). Throughout this section of the proxy statement, the Company as currently incorporated in Nevada will be referred to as “Vyrex-Nevada” and the Company as reincorporated in Delaware (which reincorporation is subject to approval of the Proposed Reincorporation by the stockholders at the Special Meeting) will be referred to as “Vyrex-Delaware.” The Board caused the formation of Vyrex-Delaware as a wholly-owned subsidiary of the Company for the sole purpose of the Proposed Reincorporation. The only activities in which Vyrex-Delaware will engage before the Proposed Reincorporation will be those related to formation and organizational matters.

You are urged to read carefully this section of the proxy statement in its entirety, including the related exhibits referenced below and attached to this proxy statement, before voting on the Proposed Reincorporation.

Method of Reincorporation

The Proposed Reincorporation will be effected by merging Vyrex-Nevada into a newly formed Delaware corporation that is a wholly-owned subsidiary of Vyrex-Nevada (“Merger”) pursuant to an Agreement and Plan of Merger in the form attached hereto as Exhibit A (“Merger Agreement”). Upon completion of the Merger, Vyrex-Nevada, as a corporate entity, will cease to exist and Vyrex-Delaware will succeed to the assets and liabilities of Vyrex-Nevada and will continue the business of the Company under its current name, “Vyrex Corporation.”

No Change in Business, Management, Board Members, Assets, Liabilities or Location of Principal Facilities

The Proposed Reincorporation will effect a change in the legal domicile of the Company and other changes of a legal nature, certain of which are described in this proxy statement. The Proposed Reincorporation will not result in any change in the business, management, board of directors, fiscal year, assets, liabilities or location of the principal facilities of the Company. The directors elected at the stockholders’ meeting to serve on the Board of Vyrex-Nevada will become the directors of Vyrex-Delaware. Any employee benefit or stock option plans of Vyrex-Nevada will become Vyrex-Delaware plans. Stockholders should note that approval of the Proposed Reincorporation will also constitute approval of these plans continuing as Vyrex-Delaware plans. Other employee benefit arrangements of Vyrex-Nevada also will be continued by Vyrex-Delaware upon the terms and subject to the conditions currently in effect.

Effective Date of Merger

The Proposed Reincorporation has been approved by the members of the Board. If approved by the stockholders, as promptly as practicable thereafter, duly authorized officers of Vyrex-Nevada and Vyrex-Delaware will make and execute Articles of Merger and a Certificate of Merger and will cause such documents to be filed with the Secretary of State of Nevada and the Secretary of State of Delaware, respectively. The effective date of the Merger will be the date on which the Merger becomes effective under the laws of Nevada or the date on which the Merger becomes effective under the laws of Delaware, whichever occurs later (“Effective Date”). As described in the Merger Agreement, if before the Effective Date the Board determines that

4

circumstances have arisen that make it inadvisable to proceed with the Proposed Reincorporation under the original terms of the Merger Agreement, the Merger (and thus the Proposed Reincorporation) may be abandoned or the Merger Agreement may be amended by the Board either before or after stockholder approval has been obtained (except that the principal terms may not be amended without obtaining further stockholder approval). In addition, as further discussed under Proposal 2 below, if you approve this Proposal 1 but do not approve Proposal 2, we would not be able to complete the Merger and the Merger would be abandoned.

Change in Capital Structure Resulting From Proposed Reincorporation

Our authorized capital stock currently consists of 50,000,000 shares of common stock and 10,000,000 shares of preferred stock, both with a par value of $0.001 per share. As of September 2, 2005, we had 8,492,867 shares of common stock outstanding. There were no shares of preferred stock outstanding. In addition, as of September 2, 2005, we had outstanding warrants to acquire 105,000 shares of Vyrex-Nevada’s common stock and options to acquire 2,787,259 shares of Vyrex-Nevada’s common stock.

The authorized stock of Vyrex-Delaware consists of 200,000,000 shares of common stock and 50,000,000 shares of preferred stock, both with a par value of $0.0001 per share. There is one share of common stock outstanding held by Vyrex-Nevada and no shares of preferred stock outstanding. There are no outstanding options or warrants. Please see Proposal 2 below pursuant to which we are seeking stockholder approval of the increase in our authorized stock that would result if the Merger is completed.

As provided in the Merger Agreement, each then outstanding share of Vyrex-Nevada common stock, $0.001 par value per share, will be automatically converted into 0.12 of a share of Vyrex-Delaware common stock, $0.0001 par value per share, on the Effective Date of the Merger, resulting in approximately 1,019,144 shares of common stock outstanding after the Merger. Any fractional share of Vyrex-Delaware’s common stock resulting from the foregoing conversion will be rounded up to the next whole number. Any outstanding option or warrant issued by Vyrex-Nevada also will automatically be converted into an equivalent option or warrant to purchase or acquire, upon the same terms and conditions, the number of shares of common stock of Vyrex-Delaware equal to the number of shares of Vyrex-Delaware the holder would have received on the Effective Date of the Merger if the holder had exercised any such option or warrant in full immediately prior to the Effective Date of the Merger, and the exercise price per share under each such option or warrant shall be equal to the exercise price per share thereunder immediately prior to the Effective Date of the Merger divided by 0.12, unless otherwise provided in the instrument granting the option or warrant

Exchange of the Stock

Please do not send in any of your stock certificates representing shares of the Company’s common stock, as it will not be necessary for you to exchange your existing Vyrex-Nevada stock certificates for Vyrex-Delaware stock certificates. You may, however, upon approval of the Proposed Reincorporation by stockholders, request that your certificates be exchanged if you so choose. Delivery of Vyrex-Nevada common stock certificates will constitute delivery for transactions in shares of Vyrex-Delaware common stock after the Effective Date. Following the Merger, each stock certificate representing issued and outstanding shares of common stock of Vyrex-Nevada will represent a number of shares of common stock of Vyrex-Delaware equal to 0.12 multiplied by the number of shares such certificate currently represents, rounded up to the nearest whole share.

Transferability of Shares

Vyrex-Nevada common stock is traded on the over-the-counter market with quotations published on the NASD OTC Bulletin Board under the symbol “VYRX.” After the Merger, Vyrex-Delaware common stock will continue to be traded on the over-the-counter market with quotations published on the NASD OTC Bulletin Board under the same symbol as the shares of Vyrex-Nevada common stock are currently traded, and the shares of Vyrex-Delaware common stock will continue to be represented by the same CUSIP number as that is currently used for Vyrex-Nevada common stock. There will be no interruption in the trading of the Company’s common stock as a result of the Proposed Reincorporation.

5

Stockholders whose shares of our common stock are freely tradable before the Proposed Reincorporation will own shares of Vyrex-Delaware common stock that are freely tradable after the Proposed Reincorporation. Similarly, any stockholders holding securities with transfer restrictions before the Proposed Reincorporation will hold securities of Vyrex-Delaware that have the same transfer restrictions after the Proposed Reincorporation. For purposes of computing the holding period under Rule 144 of the Securities Act of 1933, as amended, those who hold Vyrex-Delaware stock certificates will be deemed to have acquired their shares on the date they originally acquired their Vyrex-Nevada shares.

Charter and Bylaws

The Proposed Reincorporation necessarily includes the ratification and approval of the certificate of incorporation and bylaws for Vyrex-Delaware (the “Delaware Charter” and “Delaware Bylaws,” respectively), which will replace the current articles of incorporation and bylaws of Vyrex-Nevada (the “Nevada Charter” and “Nevada Bylaws,” respectively). As a Delaware corporation, Vyrex-Delaware is subject to the Delaware General Corporation Law (“Delaware corporate law). Vyrex-Nevada is subject to the corporation laws of Nevada set out in the Nevada Revised Statutes (“Nevada corporate law”). Copies of the Delaware Charter and Delaware Bylaws are attached to this proxy statement as Exhibits B and C, respectively. Copies of the Nevada Charter and Nevada Bylaws are included as exhibits to our filings with the United States Securities and Exchange Commission and also are available for inspection during regular business hours at our Corporate Offices. Copies will also be sent to stockholders, without charge, upon request. Please see “Significant Changes Caused by the Proposed Reincorporation” below for a summary of the changes resulting from the Proposed Reincorporation and some similarities and important differences in the rights of our stockholders before and after the Proposed Reincorporation. Please also see Proposal 2 below pursuant to which we are seeking stockholder approval of the increase in our authorized stock that would result if the Merger is completed and the Nevada Charter is replaced with the Delaware Charter.

Accounting Treatment

In accordance with generally accepted accounting principles, we expect that the Proposed Reincorporation will be accounted for as a reorganization of entities under common control and recorded at historical cost.

The discussion below is qualified in its entirety by reference to the Merger Agreement, the Delaware Charter and the Delaware Bylaws, and by the applicable provisions of Nevada corporate law and Delaware corporate law.

Principal Reasons For the Proposed Reincorporation

For many years, Delaware has followed a policy of encouraging incorporation in that state and, in furtherance of that policy, has been a leader in adopting, construing, and implementing comprehensive and flexible corporate laws that are responsive to the legal and business needs of corporations organized under its laws. Many corporations have initially chosen Delaware, or have chosen to reincorporate in Delaware, in a manner similar to that proposed by the Company. While as explained herein there are not significant differences between Delaware corporate law and Nevada corporate law, because of Delaware’s prominence as the state of incorporation for many major corporations, there is greater certainty in application and interpretation of Delaware corporate law because the Delaware courts have developed considerable expertise in dealing with corporate issues, and a substantial body of case law has developed construing Delaware law and establishing public policies with respect to corporate legal affairs. The Board believes this relative certainty could provide us with greater predictability with respect to corporate legal matters and potentially improve our ability to attract and retain qualified directors and officers and facilitate investor recognition.

In addition to what the Board believes to be the benefits of Delaware corporate law, the Board also believes the Proposed Reincorporation and the corresponding change in the Company’s capitalization will make the Company more attractive to potential financing partners and/or to other third parties as a potential merger candidate. We have had discussions with certain entities about the possibility of a merger with the Company. In at least one instance, further negotiations were conditioned by the other party on our moving forward with

6

a reincorporation in Delaware and a revision of our capital structure. While we do not have a financing or merger agreement with anyone at this time nor do we have a commitment from anyone to consummate a merger or other transaction if we were to reincorporate in Delaware and revise our capital structure, the Board believes the Proposed Reincorporation would better position the Company to pursue such opportunities.

Significant Changes Caused by the Proposed Reincorporation

In general, the Company’s corporate affairs are presently governed by Nevada corporate law, the Nevada Charter and the Nevada Bylaws. Following the Merger, issues of corporate governance and control would be controlled by Delaware, rather than Nevada, corporate law. The Nevada Charter and Nevada Bylaws will, in effect, be replaced by the Delaware Charter and the Delaware Bylaws.

The following briefly summarizes some of the changes resulting from the Proposed Reincorporation and certain significant differences between Nevada corporate law and Delaware corporate law and does not purport to be a complete statement of such laws.

Charter and Capital Structure

In general, the Nevada Charter and the Delaware Charter are substantially similar. They differ primarily with respect to the authorized stock. Please refer to “Change in Capital Structure Resulting From Proposed Reincorporation” above and Proposal 2 below pursuant to which we are seeking stockholder approval of the increase in our authorized stock that would result if the Merger is completed and the Nevada Charter is replaced with the Delaware Charter.

Fiduciary Duties of Directors

Both Delaware and Nevada law provide that the board of directors has the ultimate responsibility for managing the business and affairs of a corporation. In discharging this function, directors of Nevada and Delaware corporations owe fiduciary duties of care and loyalty to the corporations they serve, as well as their stockholders.

With respect to fiduciary duties, Nevada corporate law may provide broader discretion, and increased protection from liability, to directors in exercising their fiduciary duties, particularly in the context of a change in control. Delaware courts have held that the directors of a Delaware corporation are required to exercise an informed business judgment in performing their duties. An informed business judgment means that the directors have informed themselves of all material information reasonably available to them. Delaware courts have also imposed a heightened standard of conduct on directors in matters involving a contest for control of the corporation. A director of a Nevada business corporation must perform his or her duties as a director in good faith and with a view to the interests of the corporation.

Delaware corporate law does not contain any statutory provision permitting the board of directors, committees of the board and individual directors, when discharging their duties, to consider the interests of any constituencies other than the corporation or its stockholders. Nevada corporate law, on the other hand, provides that in discharging their duties, the board of directors, committees of the board and individual directors may, in exercising their respective powers with a view to the interests of the corporation, choose, to the extent they deem appropriate, to subordinate the interests of stockholders to the interests of employees, suppliers, customers or creditors of the corporation or to the interests of the communities served by the corporation. Furthermore, the officers and directors may consider the long-term and short-term interests of the corporation and its stockholders.

Under Delaware corporate law, directors of a Delaware corporation are presumed to have acted on an informed basis, in good faith and in the honest belief that their actions were in the best interest of the corporation. This presumption may be overcome, however, if a preponderance of the evidence shows that the directors’ decision involved a breach of fiduciary duty such as fraud, overreaching, lack of good faith, failure of the board

7

to inform itself properly or actions by the board to entrench itself in office. Delaware courts have imposed a heightened standard of conduct upon directors of a Delaware corporation who take any action designed to defeat a threatened change in control of the corporation. The heightened standard has two elements: the board must demonstrate some basis for concluding that a proper corporate purpose is served by implementation of any defensive measure and that measure must be reasonable in relation to the perceived threat posed by the change in control. Under Nevada corporate law, unless there is a breach of fiduciary duty or a lack of good faith, any act of the board of directors, any committee of the board or any individual director is presumed to be in the corporation’s best interest. No higher burden of proof or greater obligation to justify applies to any act relating to or affecting an acquisition or a potential or proposed acquisition of control of the corporation than to any other action. Nevada corporate law imposes a heightened standard of conduct upon directors who take action to resist a change or potential change in control of a corporation, if such action impedes the exercise of the stockholders’ right to vote for or remove directors.

Anti-Takeover Laws

Section 203 of the Delaware General Corporation Law contains certain “anti-takeover” provisions that apply to a Delaware corporation, unless the corporation elects not to be governed by such provisions in its certificate of incorporation or bylaws. Vyrex-Delaware has not elected to opt out of the provisions of Section 203. Section 203 precludes a corporation from engaging in any “business combination” with any person that owns 15% or more of its outstanding voting stock for a period of three years following the time that such stockholder obtained ownership of more than 15% of the outstanding voting stock of the corporation. A business combination includes any merger, consolidation, or sale of substantially all of a corporation’s assets. The three-year waiting period does not apply, however, if any of the following conditions are met:

In addition, Section 203 does not apply to any person who became the owner of more than 15% of a corporation’s stock if it was as a result of action taken solely by the corporation.

Nevada corporate law also contains certain “anti-takeover” provisions that apply to a Nevada corporation, unless the corporation elects not to be governed by such provisions in its articles of incorporation or bylaws. Vyrex-Nevada did not elect to opt out of any of these provisions. Nevada corporate law precludes a corporation from engaging in any “business combination” with any person that owns 10% or more of its outstanding voting stock for a period of three years following the time that such stockholder obtained ownership of more than 10% of the outstanding voting stock of the corporation. A business combination includes any merger, consolidation, or sale of substantially all of a corporation’s assets. The three-year waiting period does not apply, however, if the board of directors of the corporation approved either the business combination or the transaction which resulted in such stockholder owning more than 10% of such stock before the stockholder obtained such ownership.

Dividend Rights and Repurchase of Shares

Under Delaware corporate law, a corporation may declare and pay dividends out of surplus or, if no surplus exists, out of net profits, for the fiscal year in which the dividends are declared and/or for its preceding fiscal year. Dividends may not be paid out of net profits if the capital of the corporation is less than the aggregate

8

amount of capital represented by the outstanding stock of all classes having a preference upon the distribution of assets. Surplus is defined as net assets minus stated capital. Delaware corporate law applies different tests to the payment of dividends and the repurchase of shares. Delaware corporate law generally provides that a corporation may redeem or repurchase its shares only if such redemption or repurchase would not impair the capital of the corporation.

Under Nevada corporate law, a corporation is prohibited from making a distribution (including dividends on, or redemption or repurchase of, shares of capital stock) to its stockholders if, after giving effect to the distribution:

The board of directors of a Nevada corporation may base the above determination on: financial statements prepared on the basis of accounting principals, fair valuation, including without limitation unrealized appreciation or depreciation, or any other method that is reasonable under the circumstances.

Liability of Directors and Officers

Delaware corporate law permits a corporation to include in its certificate of incorporation a provision limiting or eliminating the personal liability of its directors to the corporation or its stockholders for monetary damages arising from a breach of fiduciary duty, except for:

Nevada corporate law permits a corporation to adopt any provision in its articles of incorporation that are not contrary to the laws of the state of Nevada, and there is no restriction on a corporation’s ability to limit the personal liability of a director or officer to the corporation. Under Nevada corporate law, a director or officer is not individually liable to a corporation or its stockholders for any damages as a result of any act or failure to act in his capacity as a director or officer unless it is proven that:

Indemnification of Directors and Officers

Both Delaware and Nevada, in a substantially similar matter, permit a corporation to indemnify officers, directors, employees and agents for actions taken in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interests of the corporation and, with respect to any criminal action, which they had no reasonable cause to believe were unlawful. Both Vyrex-Nevada and Vyrex-Delaware provide for such indemnifications under their respective charters and bylaws.

9

Annual Meetings

Under Delaware corporate law, if the annual meeting for the election of directors is not held on the designated date, or action by written consent to elect directors in lieu of an annual meeting has not been taken, the directors are required to cause that meeting to be held as soon as is convenient. If there is a failure to hold the annual meeting or to take action by written consent to elect directors in lieu of an annual meeting for a period of 30 days after the designated date for the annual meeting, or if no date has been designated for a period of 13 months after the latest to occur of the organization of the corporation, its last annual meeting or the last action by written consent to elect directors in lieu of an annual meeting, the Court of Chancery may summarily order a meeting to be held upon the application of any stockholder or director.

Under Nevada corporate law, if the annual meeting is not held within 18 months after the last election of directors, the district court has jurisdiction to order the election of directors, upon application of any one or more stockholders holding at least 15% of the voting power.

Adjournment of Stockholder Meetings

Under Delaware corporate law, if a meeting of stockholders is adjourned due to lack of a quorum and the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting must be given to each stockholder of record entitled to vote at the meeting. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting.

Under Nevada corporate law, a corporation is not required to give any notice of an adjourned meeting or of the business to be transacted at an adjourned meeting, other than by announcement at the meeting at which the adjournment is taken, unless the board fixes a new record date for the adjourned meeting.

Amendments to Bylaws

Under Delaware corporate law, bylaws may be adopted, amended or repealed by the stockholders entitled to vote thereon. A corporation may, in its certificate of incorporation, confer this power upon the directors, although the power vested in the stockholders shall not be divested or limited where the board of directors also has such power.

Nevada corporate law provides that the board of directors of a corporation may make the bylaws, but that such bylaws are subject to those adopted by the stockholders, if any. Further, although not part of Nevada corporate law, an opinion of the Nevada Attorney General also provides that directors may adopt bylaws for a corporation if the stockholders do not. Stockholders nevertheless retain the right to adopt bylaws superseding those adopted by the board of directors.

Interested Director Transactions

Under Delaware corporate law, contracts or transactions in which one or more of a corporation’s directors has an interest are not void or voidable because of such interest, if certain conditions are met. To meet these conditions, either (i) the stockholders or the disinterested directors must approve any such contract or transaction after the full disclosure of material facts, or (ii) the contract or transaction must have been fair as to the corporation at the time it was approved. Under Delaware corporate law, if board approval is sought, the contract or transactions must be approved by a majority of the disinterested directors (even though less than a quorum).

10

Nevada corporate law does not automatically void contracts or transactions between a corporation and one of the corporation’s directors. Under Nevada corporate law, a contract or transaction may not be voided solely because:

Instead, under Nevada corporate law, contracts or transactions such as those described above are permissible if:

Removal of Directors

Under Delaware corporate law, any director or the entire board of directors may be removed, with or without cause, by the majority vote of the stockholders then entitled to vote at an election of directors. However, if the corporation has a classified board, such as Vyrex-Delaware, directors may only be removed without cause if the certificate of incorporation so provides.

A director of a Nevada corporation or the entire board of directors may be removed with or without cause during their term of office only by a vote of two-thirds of the voting power of the then outstanding shares entitled to vote in an election of directors.

Stockholders’ Rights to Examine Books and Records

Delaware corporate law provides that any stockholder of record may, in a written demand made under oath, demand to examine a corporation’s books and records for a proper purpose reasonably related to such person’s interest as a stockholder. If management of the corporation refuses, the stockholder can compel an examination by court order.

Nevada corporate law permits any person who has been a stockholder of record for at least six months, or any person holding at least 5% of all outstanding shares, to inspect and copy the stockholders’ list, articles of incorporation or bylaws, if the stockholder gives at least five business days’ prior written notice. The corporation may deny inspection if the stockholder refuses to furnish an affidavit that the inspection is not desired for a purpose or object other than the business of the corporation and that he or she has not at any time offered for sale or sold any stockholders’ lists of any corporation or aided and abetted any person in procuring a list for that purpose. In addition, a Nevada corporation must allow stockholders who own or represent at least 15% of the corporation’s outstanding shares the right, upon at least five days’ written demand, to inspect the books of account and financial records of the corporation, to make copies from them and to conduct an audit of those records, except that any corporation listed and traded on any recognized stock exchange or any corporation that furnishes to its stockholders a detailed, annual financial statement is exempt from this requirement.

11

Duration of Proxies

Under Delaware corporate law, a proxy executed by a stockholder will remain valid for a period of three years, unless the proxy provides for a longer period. Under Nevada corporate law, a proxy is effective only for a period of six months, unless it is coupled with an interest or unless otherwise provided in the proxy, which duration may not exceed seven years.

Differences in Franchise Taxes

Nevada does not have a corporate franchise tax. After the Merger is accomplished, the Company will pay annual franchise taxes to Delaware. The Delaware franchise tax is based on a formula involving the number of authorized shares or the asset value of the corporation, whichever would impose a lesser tax.

Certain Federal Income Tax Consequences of the Proposed ReincorporationOTHER BUSINESS

The following is a discussionBoard knows of certain federal income tax consequencesno other business to holders of Vyrex-Nevada common stock who receive shares of Vyrex-Delaware common stockbe brought before the Annual Meeting. If, however, any other business should properly come before the Annual Meeting, the persons named in exchange forthe accompanying proxy will vote the proxy in accordance with applicable law and as they may deem appropriate in their Vyrex-Nevada stock as a result ofdiscretion, unless directed by the Proposed Reincorporation. It is based on the Internal Revenue Code of 1986, as amended (“Code”), laws, regulations, rulings and decisions in effect as of the date of this proxy statement, all of which are subject to change, possibly with retroactive effect, and to differing interpretations. No state, local or foreign tax consequences are addressed herein.do otherwise.

This discussion is for general information only and does not purport to be a complete discussion or analysis of all potential tax consequences that may apply to a stockholder. In view of the varying nature of such tax consequences, stockholders are urged to consult their own tax advisors as to the specific tax consequences to them of the Proposed Reincorporation, including the applicability of federal, state, local or foreign tax laws.

Subject to the limitations, qualifications and exceptions described in this section, it is expected that, for federal income tax purposes, the Proposed Reincorporation will constitute a tax-free reorganization under Section 368(a) of the Code. Assuming the Proposed Reincorporation qualifies as a tax-free reorganization, no gain or loss will be recognized by the holders of shares of Vyrex-Nevada common stock (other than those who seek their statutory appraisal rights) as a result of the consummation of the Proposed Reincorporation. Each former holder of shares of Vyrex-Nevada common stock will have the same aggregate tax basis in the shares of Vyrex-Delaware common stock received by such person in the Proposed Reincorporation as such holder had in the shares of Vyrex-Nevada common stock held by such person at the time of consummation of the Proposed Reincorporation and each such stockholder’s holding period with respect to such shares of Vyrex-Delaware common stock will include the period during which such holder held the corresponding shares of Vyrex-Nevada common stock, provided the latter were held by such person as capital assets at the time of the consummation of the Proposed Reincorporation.

The Company has not requested a ruling from the Internal Revenue Service (“IRS”) or an opinion of counsel with respect to the federal income tax consequences of the Proposed Reincorporation under the Code. A successful IRS challenge to the tax-free status of the Proposed Reincorporation would result in a stockholder recognizing gain or loss with respect to each share of Vyrex-Nevada common stock exchanged in the Proposed Reincorporation equal to the difference between the stockholder’s basis in such share and the fair market value, as of the time of the Proposed Reincorporation, of the shares of Vyrex-Delaware common stock received in exchange therefor. In such event, a stockholder’s aggregate basis in the shares of Vyrex-Delaware common stock received in the exchange would equal their fair market value on such date, and the stockholder’s holding period for such shares would not include the period during which the stockholder held shares of Vyrex-Nevada common stock.

State, local, or foreign income tax consequences to stockholders may vary from the federal tax consequences described above. You should consult your own tax advisors as to the effect of the Proposed Reincorporation under applicable federal, state, local, or foreign income tax laws.

12

The Company should not recognize gain or loss for federal income tax purposes as a result of the Proposed Reincorporation, and Vyrex-Delaware should succeed without adjustment to the federal income tax attributes of Vyrex-Nevada.

Appraisal Rights and Procedures

Under Sections 92A.300 to 92A. 500, inclusive, of the Nevada Revised Statutes, any holder of our common stock who does not wish to become a stockholder of Vyrex-Delaware may seek to receive the appraised value (exclusive of any element of value arising from the accomplishment or expectation of the Proposed Reincorporation) for his or her shares of our common stock, judicially determined, in cash, together with a fair rate of interest, if any, provided that the stockholder fully complies with the provisions of Sections 92A.300 to 92A.500, inclusive, of the Nevada Revised Statutes. If, however, holders of more than 2% or our outstanding common stock exercise their appraisal rights, we have the right to terminate the Proposed Reincorporation.

Ensuring the perfection of your appraisal rights can be complicated. The procedural rules are specific and must be followed precisely. Failure to comply with such rules may cause a termination or waiver of your appraisal rights. The information herein is only a brief summary of the material provisions of the statutory procedures you must follow in order to perfect your appraisal rights. Please review Sections 92A.300 to 92A.500, inclusive, of the Nevada Revised Statutes for the complete procedures. We will not give you any notice other than as described in this proxy statement and as required by the Nevada Revised Statutes. A copy of Sections 92A.300 to 92A.500, inclusive, of the Nevada Revised Statutes is attached hereto as Exhibit D.

Any stockholder wanting to exercise dissenters’ rights must deliver written notice to the Company, before the date of the Special Meeting, or at the Special Meeting before the Merger Agreement is voted upon, stating that the stockholder intends to demand payment for his, her or its shares of Company common stock if the Proposed Reincorporation is approved (Section 92A.420.1(a) of the Nevada corporate law). In addition, the stockholder must not vote his, her or its shares in favor of the Proposed Reincorporation (Section 92A.420.1(b) of the Nevada corporate law). Notices transmitted before the meeting should be addressed to Vyrex Corporation, 2159 Avenida de la Playa, La Jolla, California 92037, Attention: Mr. G. Dale Garlow, President. At the Special Meeting, notices may be handed to Mr. Garlow. Stockholders who vote in favor of the Proposed Reincorporation will be deemed to have waived their dissenters’ rights.

A stockholder whose shares of Company common stock are held in “street name” or in the name of anyone other than the stockholder must obtain written consent from the person or firm in whose name the shares are registered, allowing the stockholder to file the notice demanding payment for the shares in question, and must deliver the consent to the Company no later than the time that dissenters’ rights are asserted (Section 92A.400.2(a) of the Nevada corporate law). Also, the dissent must be asserted as to all shares of Company common stock that the stockholder beneficially owns or has power to vote at the Special Meeting (Section 92A.400.2(b) of the Nevada corporate law).

Any stockholder who does not complete the requirements of Sections 92A.400 and 92A.420.1(a) and (b) of the Nevada corporate law as described above is not entitled to payment for his, her or its shares of Company common stock (Section 92A.420.2 of the Nevada corporate law).

If you fail to comply strictly with the procedures described above, you will lose your appraisal rights. Consequently, if you wish to exercise your appraisal rights, we strongly urge you to consult a legal advisor before attempting to exercise your appraisal rights.

13

What Your Approval of this Proposal Means

If you vote “For” this Proposal 1, you will be approving the following:

Please note that while a vote “For” this Proposal 1 would also necessarily mean the approval of the Delaware Charter, we are seeking separate approval, as set forth in Proposal 2 below, of the increase in the authorized capital stock of the Company that would result if this Proposal 1 is approved and the Merger is completed. Vyrex-Delaware has been formed as a Delaware corporation and is governed by the Delaware Charter, which has the authorized capital described in this proxy statement. As a result, if you approve this Proposal 1 but do not approve Proposal 2, the Merger could not be completed and would be abandoned.

You should be aware that if a merger or other opportunity arises as discussed under “Principal Reasons for the Proposed Reincorporation,” depending on the nature and structure of any such opportunity, you may or may not have the opportunity to vote on whether the Company should consummate any such transaction. For example, if an opportunity arises that the Board determines to be in the best interest of the Company and its stockholders, the transaction could be structured so as not to require stockholder approval, such as by forming a wholly-owned subsidiary of Vyrex-Delaware and merging into such subsidiary a third party entity. As the sole stockholder of such subsidiary would be Vyrex-Delaware, the Board’s approval of the transaction would be the sole approval required to consummate the transaction. Thus, to the extent the Proposed Reincorporation does in fact make the Company more attractive to potential financing partners and/or to other third parties as a potential merger candidate, your approval of the Proposed Reincorporation and Merger could also indirectly result in the consummation by the Company of such a financing or merger transaction.

Our Board of Directors unanimously recommends that you vote “FOR” Proposal 1.

14

PROPOSAL 2

APPROVALSUBMISSION OF AN INCREASE OF OUR AUTHORIZED CAPITAL STOCK FROM 60,000,000

(50,000,000 OF COMMON STOCK AND 10,000,000 OF PREFERRED STOCK) TO 250,000,000

(200,000,000 OF COMMON STOCK AND 50,000,000 OF PREFERRED STOCK)

As discussed under Proposal 1 above, we are seeking approval of the Proposed Reincorporation. As part of the Proposed Reincorporation, if approved, the Nevada Charter would be replaced by the Delaware Charter. This would result in an increase in the authorized capital stock of the Company from 60,000,000 (50,000,000 of common stock and 10,000,000 of preferred stock) to 250,000,000 (200,000,000 of common stock and 50,000,000 of preferred stock). As discussed above under “Principal Reasons for the Proposed Reincorporation,” the Board believes such an increase in our authorized capital stock would make the Company more attractive to potential financing partners and/or to other third parties as a potential merger candidate and would provide the Company with additional flexibility in structuring any such opportunities that may arise.

You should keep in mind that if this Proposal 2 is approved, it would mean that we would have more shares of common stock available for issuance. The future issuance of these additional shares will result in dilution to our stockholders. While we do not currently have any agreements or understandings to issue any of the additional shares of capital stock, to the extent the Proposed Reincorporation, including the increase in authorized capital stock, makes the Company more attractive to potential financing partners and/or to other third parties as a potential merger candidate, your approval of the Proposed Reincorporation and this Proposal 2 could indirectly result in the consummation by the Company of such a financing or merger transaction, which likely would result in the issuance of additional shares of capital stock.

Because Vyrex-Delaware already has been formed and is governed by the Delaware Charter, which contains the increase in authorized capital described in this proxy statement, if you approve Proposal 1 but do not approve this Proposal 2, the Merger can not be completed and would be abandoned. Similarly, if you approve this Proposal 2 but do not approve Proposal 1, the capital stock of the Company will not be increased and the Company will continue to be governed by the Nevada Charter and will have the authorized capital set forth therein.

Our Board of Directors unanimously recommends that you vote “FOR” Proposal 2.

FUTURE STOCKHOLDER PROPOSALS

Stockholders who wish to submit a proposal for inclusion in our proxy materialsproposals to be distributed in connection with next year’s annual meeting must submit their proposal so that we receive it no later thanconsidered or to nominate persons for election to the closeBoard of business on February 13, 2006. Any such proposalDirectors at the 2024 Annual Meeting must be in accordance with the requirements of Rule 14a-8 under the Securities Exchange Act of 1934, as amended. Pursuant to such rule, simply submitting a proposal does not guarantee that it will be included in our proxy materials.

In accordance with our Restated Articles of Incorporation, to be properly brought before a regularly scheduled meeting, a stockholder of record, both when they give us notice and at the 2024 Annual Meeting, must deliver timelybe entitled to vote at the 2024 Annual Meeting. A stockholder’s notice of any matter the stockholder wishesmust be delivered to present. To be timely, we must receive the notice our Secretary at c/o 374Water Inc. 3710 Shannon Rd., Suite 51877, Durham, North Carolina 27717not less than 6045 nor more than 75 days before the original scheduled meeting date. If we provide less than 70 days’ notice or prior public disclosureanniversary date of the meeting date, to be timely we must receiveimmediately preceding Annual Meeting. For our 2024 Annual Meeting, the notice must be delivered between March 31, 2024 and April 30, 2024. However, if our 2024 Annual Meeting is not within 30 days prior to or 60 days after August 30, 2024, the notice must be delivered no later than the close of business on the 10th day following the earlier of the day on which we mailed noticethe first public announcement of the date of the 2024 Annual Meeting or 120 days prior to such meeting datebut not later than 90 days prior to such meeting. The public announcement of an adjournment or postponement of the day on which we publicly disclosed2024 Annual Meeting will not trigger a new time period (or extend any time period) for the meeting date. To begiving of a stockholder notice as described in proper form, the notice must be in writing and include the specified information set forth in Article Thirteenthis proxy statement.

A copy of our Restated Articles2022 Annual Report on Form 10-K, as amended, is available without charge (except for exhibits, which are available upon payment of Incorporation.

15

All proposals and notices should be sent by certified mail, return receipt requested,a reasonable fee) upon written request to Vyrex Corporation, 2159 Avenida de la Playa, La Jolla, California 92037, Attn: Dr. Sheldon Hendler, Secretary. We reserve the right to reject, rule out of order, or take other appropriate action with respect to any proposal or matter that does not comply with these and other applicable requirements.

OTHER MATTERS

The Board of Directors does not know of any other matters that will be presented for consideration at the Special Meeting. If any other matters are properly brought before the Special Meeting or any adjournment thereof, the proxy holders named in the accompanying proxy card will have discretionary authority to vote all proxies in accordance with their best judgment with respect to any such matters.

ADDITIONAL INFORMATION

Documents filed by us with the United States Securities and Exchange Commission may be reviewed and/or obtained through the Securities and Exchange Commission’s Electronic Data Gathering Analysis and Retrieval System, which is publicly available through the Securities and Exchange Commission’s website at http://www.sec.gov.374Water Inc. Attention: Secretary, 3710 Shannon Rd., Suite 51877, Durham, North Carolina 27717.

16

EXHIBIT A

AGREEMENT AND PLAN OF MERGER

(as proposed to be adopted)

THIS AGREEMENT AND PLAN OF MERGER (hereinafter referred to as this “Agreement”) dated as of September, 2005, is made and entered into by and between Vyrex Corporation, a Nevada corporation (the “Parent”) and Vyrex (Delaware) Corporation, a Delaware corporation (the “Subsidiary”).

RECITALS

A.    The Parent is a corporation organized and existing under the laws of the State of Nevada.

B.    The Subsidiary is a corporation organized and existing under the laws of the State of Delaware and is a wholly-owned subsidiary of the Parent.

C.    The Parent and the Subsidiary and their respective Boards of Directors deem it advisable and to the advantage, welfare, and best interests of the corporations and their respective stockholders to merge Parent with and into Subsidiary pursuant to the provisions of Nevada Revised Statutes (the “NRS”) and the Delaware General Corporation Law (the “DGCL”) upon the terms and conditions hereinafter set forth.

NOW THEREFORE, in consideration of the premises, the mutual covenants herein contained and other good and valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Parent shall be merged into the Subsidiary (the “Merger”) upon the terms and conditions hereinafter set forth.

ARTICLE I

PRINCIPAL TERMS OF THE MERGER

1.1    Merger. On the Effective Date (as defined in Section 4.1 hereof), the Parent shall be merged into the Subsidiary, the separate existence of the Parent shall cease and the Subsidiary (following the Merger referred to as the “Surviving Corporation”) shall operate under the name “Vyrex Corporation” by virtue of, and shall be governed by, the laws of the State of Delaware. The address of the registered office of the Surviving Corporation in the State of Delaware will be 2711 Centerville Road, Suite 400, City of Wilmington, County of Newcastle, and the registered agent in charge thereof shall be Corporation Service Company.

1.2    Certificate of Incorporation of the Surviving Corporation. The Certificate of Incorporation of the Surviving Corporation shall be the Certificate of Incorporation of the Subsidiary as in effect on the date hereof without change unless and until amended in accordance with applicable law.

1.3    Bylaws of the Surviving Corporation. The Bylaws of the Surviving Corporation shall be the Bylaws of the Subsidiary as in effect on the date hereof without change unless and until amended or repealed in accordance with applicable law.

1.4    Directors and Officers. At the Effective Date of the Merger, the directors and officers of the Subsidiary in office at the Effective Date of the Merger shall become the directors and officers, respectively, of the Surviving Corporation, each of such directors and officers to hold office, subject to the applicable provisions of the Certificate of Incorporation and Bylaws of the Surviving Corporation and the DGCL, until his or her successor is duly elected or appointed and qualified.

A-1

ARTICLE II

CONVERSION, CERTIFICATES AND PLANS

2.1    Conversion of Shares. At the Effective Date of the Merger, each of the following transactions shall be deemed to occur simultaneously:

(a)Common Stock. Each share of the Parent’s common stock, $0.001 par value per share (the “Parent’s Common Stock”), issued and outstanding immediately prior to the Effective Date of the Merger (except for those shares of the Parent’s Common Stock with respect to which the holders thereof duly exercise their dissenters’ rights under the NRS), by virtue of the Merger and without any action on the part of the holder thereof, shall be converted into and become one validly issued, fully paid and nonassessable share of the Surviving Corporation’s common stock, $0.0001 par value per share (the “Surviving Corporation’s Common Stock”) multiplied by the Conversion Ratio (as defined below). Any holder’s fractional share of the Surviving Corporation’s Common Stock resulting from the foregoing conversion shall be rounded up to the next whole number. The “Conversion Ratio” shall be a fraction the numerator of which is 12 and the denominator of which is 100.

(b)Options. Each option to acquire shares of the Parent’s Common Sock outstanding immediately prior to the Effective Date of the Merger shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become an equivalent option to acquire, upon the same terms and conditions, the number of shares of the Surviving Corporation’s Common Stock, which is equal to the number of shares of the Parent’s Common Stock that the optionee would have received had the optionee exercised such option in full immediately prior to the Effective Date of the Merger (whether or not such option was then exercisable) multiplied by the Conversion Ratio and the exercise price per share under each of said options shall be equal to the exercise price per share thereunder immediately prior to the Effective Date of the Merger divided by the Conversion Ratio, unless otherwise provided in the instrument granting such option.

(c)Warrants. Each warrant to acquire shares of the Parent’s Common Stock outstanding immediately prior to the Effective Date of the Merger shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become a warrant to acquire, upon the same terms and conditions, the number of shares of the Surviving Corporation’s Common Stock which is equal to the number of shares of the Parent’s Common Stock that the warrant holder would have received had the warrant holder exercised such warrant in full immediately prior to the Effective Date of the Merger (whether or not such warrant was then exercisable) multiplied by the Conversion Ratio and the exercise price per share under each of said warrants shall be equal to the exercise price per share thereunder immediately prior to the Effective Date of the Merger divided by the Conversion Ratio, unless otherwise provided in the instrument granting such warrant.

(d)Other Rights. Any other right, by contract or otherwise, to acquire shares of the Parent’s Common Stock outstanding immediately prior to the Effective Date of the Merger shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become a right to acquire, upon the same terms and conditions, the number of shares of the Surviving Corporation’s Common Stock which is equal to the number of shares of the Parent’s Common Stock that the right holder would have received had the right holder exercised such right in full immediately prior to the Effective Date of the Merger (whether or not such right was then exercisable) multiplied by the Conversion Ratio and the exercise price per share under each of said rights shall be equal to the exercise price per share thereunder immediately prior to the Effective Date of the Merger divided by the Conversion Ratio, unless otherwise provided in the agreement granting such right.

(e) Each share of the Subsidiary’s Common Stock issued and outstanding immediately prior to the Effective Date of the Merger and held by the Parent shall be canceled without any consideration being issued or paid therefor.

A-2

2.2    Stock Certificates. After the Effective Date of the Merger, each certificate theretofore representing issued and outstanding shares of the Parent’s Common Stock will thereafter be deemed to represent the number of shares of the Surviving Corporation’s Common Stock equal to the number of shares shown on the face of such certificate multiplied by the Conversion Ratio. The holders of outstanding certificates theretofore representing the Parent’s Common Stock will not be required to surrender such certificates to the Parent.

2.3    Employee Benefit and Compensation Plans. At the Effective Date of the Merger, each employee benefit plan, incentive compensation plan and other similar plans to which the Parent is then a party shall be assumed by, and continue to be the plan of, the Surviving Corporation. To the extent any employee benefit plan, incentive compensation plan or other similar plan of the Parent provides for the issuance or purchase of, or otherwise relates to, the Parent’s Common Stock, after the Effective Date of the Merger such plan shall be deemed to provide for the issuance or purchase of, or otherwise relate to, the Surviving Corporation’s Common Stock (with all share amounts and purchase or exercise prices being appropriately adjusted by the Conversion Ratio).

ARTICLE III

TRANSFER AND CONVEYANCE OF ASSETS AND ASSUMPTION OF LIABILITIES

3.1    Effects of the Merger. At the Effective Date of the Merger, the Merger shall have the effects specified in the NRS, the DGCL and this Agreement. Without limiting the generality of the foregoing, and subject thereto, at the Effective Date of the Merger, the Surviving Corporation shall possess all the rights, privileges, powers and franchises, of a public as well as a private nature, and shall be subject to all the restrictions, disabilities and duties of each of the parties to this Agreement; the rights, privileges, powers and franchises of the Parent and the Subsidiary, and all property, real, personal and mixed, and all debts due to each of them on whatever account, shall be vested in the Surviving Corporation; and all property, rights, privileges, powers and franchises, and all and every other interest shall be thereafter the property of the Surviving Corporation, as they were of the respective constituent entities, and the title to any real estate whether by deed or otherwise vested in the Parent and the Subsidiary or either of them, shall not revert to be in any way impaired by reason of the Merger; but all rights of creditors and all liens upon any property of the parties hereto, shall be preserved unimpaired, and all debts, liabilities and duties of the respective constituent entities shall thenceforth attach to the Surviving Corporation, and may be enforced against it to the same extent as if said debts, liabilities and duties had been incurred or contracted by it.

3.2    Additional Actions. If, at any time after the Effective Date of the Merger, the Surviving Corporation shall consider or be advised that any further assignments or assurances in law or any other acts are necessary or desirable (a) to vest, perfect or confirm, of record or otherwise, in the Surviving Corporation, title to and possession of any property or right of the Parent acquired or to be acquired by reason of, or as a result of, the Merger, or (b) otherwise to carry out the purposes of this Agreement, the Parent and its proper officers and directors shall be deemed to have granted to the Surviving Corporation an irrevocable power of attorney to execute and deliver all such proper deeds, assignments and assurances in law and to do all acts necessary or proper to vest, perfect or confirm title to and possession of such property or rights in the Surviving Corporation and otherwise to carry out the purposes of this Agreement. The proper officers and directors of the Surviving Corporation are fully authorized in the name of the Parent or otherwise to take any and all such action.

ARTICLE IV

APPROVAL BY STOCKHOLDERS; AMENDMENT; EFFECTIVE DATE

4.1    Approval. This Agreement and the Merger contemplated hereby are subject to approval by the requisite vote of stockholders in accordance with the NRS and the DGCL. As promptly as practicable after approval of this Agreement by stockholders in accordance with applicable law, duly authorized officers of the

A-3

respective parties shall make and execute Articles of Merger and a Certificate of Merger and shall cause such documents to be filed with the Secretary of State of Nevada and the Secretary of State of Delaware, respectively, in accordance with the laws of the States of Nevada and Delaware. The effective date (the “Effective Date”) of the Merger shall be the date on which the Merger becomes effective under the laws of Nevada or the date on which the Merger becomes effective under the laws of Delaware, whichever occurs later.

4.2    Amendments. The Board of Directors of the Parent may amend this Agreement at any time prior to the Effective Date, provided that an amendment made subsequent to the approval of the Merger by the stockholders of the Parent shall not (a) alter or change the amount or kind of shares to be received in exchange for or on conversion of all or any of the shares of the Parent’s Common Stock, (b) alter or change any term of the Certificate of Incorporation of the Subsidiary, or (c) alter or change any of the terms and conditions of this Agreement if such alteration or change would adversely affect the holders of the Parent’s Common Stock.

ARTICLE V

MISCELLANEOUS

5.1    Termination. This Agreement maybe terminated and the Merger abandoned at any time prior to the filing of this Agreement with the Secretary of State of Nevada and the Secretary of State of Delaware, whether before or after stockholder approval of this Agreement, by the consent of the Boards of Directors of the Parent and the Subsidiary.

5.2    Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be considered to be an original instrument.

5.3    Descriptive Headings. The descriptive headings are for convenience of reference only and shall not control or affect the meaning or construction of any provision of this Agreement.

5.4    Governing Law. This Agreement shall be construed in accordance with the laws of the State of Delaware, except to the extent the laws of the State of Nevada shall apply to the Merger where mandated by the NRS.

IN WITNESS WHEREOF, the undersigned officers of each of the parties to this Agreement, pursuant to authority duly given by their respective Boards of Directors, have caused this Agreement to be duly executed on the date set forth above.

A-4

EXHIBIT B

DELAWARE CHARTER

CERTIFICATE OF INCORPORATION

OF

VYREX (DELAWARE) CORPORATION

ONE:The name of this corporation is Vyrex (Delaware) Corporation.

TWO:The address of the registered agent for service of process for the corporation is Corporation Service Company, 2711 Centerville Road, Suite 400, City of Wilmington, County of New Castle, State of Delaware 19808.

THREE: The nature of the business and the purpose for which the corporation is formed are to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware.

FOUR: The corporation is to have perpetual existence.

FIVE: In furtherance and not in limitation of the powers confined by statute, the Board of Directors is expressly authorized to make, alter or repeal the bylaws of the corporation.

SIX: The total number of shares of stock this corporation shall have authority to issue is Two Hundred Fifty Million (250,000,000) shares, divided into two classes of stock designated respectively “Common Stock” and “Preferred Stock”, both of which shall have a par value of $.0001 per share. The number of shares of Common Stock which this corporation shall have authority to issue is Two Hundred Million (200,000,000) shares. The number of shares of Preferred Stock which this corporation shall have authority to issue is Fifty Million (50,000,000) shares.

The Board of Directors of this corporation is authorized, subject to limitations prescribed by law and the provisions of this Certificate of Incorporation, to provide for the issuance of the shares of Preferred Stock in one or more series, and by filing a certificate pursuant to the applicable law of the State of Delaware, to establish from time to time the number of shares to be included in each such series, and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereon including, but not limited to, the determination of dividend, voting, liquidation, redemption and conversion rights, preferences and limitations and any other preferences and relative, participating, optional or other special rights. The Board of Directors is also authorized to increase or decrease the number of shares of any series before or after the issue of that series, but not above the total number of authorized and unissued shares of the series or below the number of shares of such series then outstanding.

SEVEN: The Board shall be divided as nearly equal in number as possible into three classes, designated Class I, Class II and Class III. The term of office of Directors of one class shall expire at each meeting of Stockholders at which Directors are elected, and in all cases as to each Director until his or her successor shall be elected and shall qualify or until his or her earlier resignation, removal from office, death or incapacity. Additional directorships resulting from an increase in number of Directors shall be apportioned among the classes as equally as possible. The initial term of office of Directors of Class I shall expire at the first regularly scheduled meeting of Stockholders held after October 1, 2005, at which Directors are elected; that of Class II shall expire at the first regularly scheduled meeting of Stockholders occurring after October 1, 2006, at which Directors are elected; and that of Class III shall expire at the first regularly scheduled meeting of Stockholders occurring after October 1, 2007, at which Directors are elected; and in all cases as to each Director until his or her successor shall be elected and shall qualify, or until his or her earlier resignation, removal from office, death or incapacity. At each meeting of Stockholders at which Directors are elected, the number of Directors equal to

B-1

the number of Directors of the class whose term expires at the time of such meeting (or, if less, the number of Directors properly nominated and qualified for election) shall be elected to hold office until the third succeeding annual meeting of Stockholders after their election.

EIGHT: Any action required or permitted to be taken at any meeting of Stockholders may be taken only upon the vote of Stockholders at an annual or special meeting duly called and may not be taken by written consent of the Stockholders.