05/02/2022 | Press release | Distributed by Public on 05/02/2022 15:21
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Preliminary Proxy Statement
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Confidential, For Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to Rule 14a-11(c) or rule 14a-12
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ABEONA THERAPEUTICS INC.
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(Name of Registrant as Specified In Its Charter)
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Amount previously paid:
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1.
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To approve an amendment to the Restated Certificate of Incorporation of the company to effect a reverse stock split of our common stock at a ratio to be determined by the Board within a range of one-for-10 to one-for-80 (or any number in between), without reducing the authorized number of shares of our common stock, to be effected in the sole discretion of the Board at any time within one year of the date of the Special Meeting without further approval or authorization of our stockholders; and
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2.
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To consider and vote upon an adjournment of the Special Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal No. 1.
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BY ORDER OF THE BOARD OF DIRECTORS,
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Vishwas Seshadri
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President and Chief Executive Officer
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD AT 10:00 A.M. ET ON JUNE 14, 2022
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1
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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING
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2
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
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6
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PROPOSALS TO BE ACTED UPON AT THE SPECIAL MEETING
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8
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PROPOSAL NO. 1 - APPROVAL OF THE AMENDMENT TO RESTATED CERTIFICATE OF INCORPORATION OF THE COMPANY TO EFFECT THE REVERSE STOCK SPLIT
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8
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PROPOSAL NO. 2 - APPROVAL OF POSSIBLE ADJOURNMENT OF THE SPECIAL MEETING
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15
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OTHER MATTERS
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16
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STOCKHOLDERS SHARING AN ADDRESS OR HOUSEHOLD
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16
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SUBMISSION OF NOMINATIONS AND PROPOSALS FOR THE 2022 ANNUAL MEETING
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16
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WHERE YOU CAN FIND ADDITIONAL INFORMATION
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16
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Q:
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What is the purpose of the Special Meeting?
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A:
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The purpose of the Special Meeting is to hold a stockholder vote on the following matters:
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1.
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To approve an amendment to the Restated Certificate of Incorporation of the Company (the "Charter") to effect a reverse stock split of our Common Stock at a ratio to be determined by the Board within a range of one-for-10 to one-for-80 (or any number in between), without reducing the authorized number of shares of our Common Stock, to be effected in the sole discretion of the Board at any time within one year of the date of the Special Meeting without further approval or authorization of our stockholders (the "Reverse Stock Split"); and
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2.
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To consider and vote upon an adjournment of the Special Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal No. 1.
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Q:
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Who may attend and vote at the Special Meeting?
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A:
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Only stockholders who own our Common Stock, Series A Preferred Stock, or Series B Preferred Stock, as of the close of business on May 3, 2022, the record date for the Special Meeting (the "Record Date"), will be entitled to attend and vote at the Special Meeting. At the discretion of management, we may also permit certain individuals to attend the Special Meeting, including professional service providers and our employees.
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Q:
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How many shares may be voted at the Special Meeting?
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A:
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Each share of our Common Stock outstanding on the Record Date entitles the holder thereof to one vote on each matter submitted to the stockholders at the Special Meeting. As of the Record Date, there were [147,019,899] shares of our Common Stock issued and outstanding. Holders of Common Stock, Series A Preferred Stock and Series B Preferred Stock will vote on the Reverse Stock Split Proposal as a single class. Only the holders of Common Stock and Series A Preferred Stock are entitled to vote on the Adjournment Proposal.
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Number of
Shares
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Number of
Votes per share
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Aggregate
Number of Votes
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Percentage of
Total Voting
Power
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Common Stock
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[147,019,899]
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1
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[147,019,899]
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76.8%
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Series A Preferred Stock
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1,000,006
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44,444
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44,444,710
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23.2%
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Series B Preferred Stock(1)
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250,005
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15,000
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3,750,075,000
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-
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(1)
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Shares of Series B Preferred Stock will be voted in a manner that "mirrors" the proportions of the votes of the shares of Common Stock (excluding any shares of Common Stock that are not voted) and Series A Preferred Stock.
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Q:
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How do I vote?
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A:
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If you were a holder of our Common Stock or Preferred Stock as of the Record Date, you may vote in person at the Special Meeting, vote by proxy through the internet or vote by proxy using the enclosed proxy card. To vote through the internet, go to www.virtualshareholdermeeting.com/ABEO2022SM and complete an electronic proxy card. You will be asked for a Control Number, which has been provided with the Notice of Internet Availability.
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How will my shares be voted at the Special Meeting?
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If you vote by proxy, the individuals named on the proxy, or their substitutes, will vote your shares in the manner you indicate. If a beneficial owner who holds shares in street name does not provide specific voting instructions to their brokerage firm, bank, broker dealer or other nominee, under the rules of certain securities exchanges, the brokerage firm, bank, broker dealer or other nominee holding those shares may generally vote as the nominee determines in its discretion on behalf of the beneficial owner on routine matters but cannot vote on non-routine matters, the latter of which results in "broker non-votes." The Proposals involve matters considered routine under the applicable rules. Accordingly, if you do not give instructions to your broker, the broker may vote your shares in its discretion on the Proposals and therefore no broker non-votes are expected in connection with the Proposals.
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Proposal No. 1. "FOR" an amendment to the Restated Certificate of Incorporation to effect a reverse stock split of our Common Stock at a ratio to be determined by the Board of Directors within a range
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Proposal No. 2. "FOR" an adjournment of the Special Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal No. 1.
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Q:
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What is the difference between holding shares as a stockholder of record and as a beneficial owner?
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A:
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Most stockholders hold their shares through a bank, broker or other financial intermediary rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and shares held beneficially.
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Q:
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What are the recommendations of the Board?
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A:
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The Board recommends that you vote:
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1.
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"FOR" the proposed amendment to the Restated Certificate of Incorporation to effect a reverse stock split of our Common Stock at a ratio to be determined by the Board within a range of one-for-10 to one-for-80 (or any number in between), without reducing the authorized number of shares of our Common Stock, to be effected in the sole discretion of the Board at any time within one year of the date of the Special Meeting without further approval or authorization of our stockholders.
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2.
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"FOR" an adjournment of the Special Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal No. 1.
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Q:
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What constitutes a quorum at the Special Meeting?
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A:
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A quorum is necessary to hold a valid meeting. The presence, via the live webcast or by proxy, of holders of our capital stock entitled to cast one-third of all the votes entitled to be cast at the Special Meeting constitutes a quorum for the transaction of business. Abstentions will be counted as present for purposes of establishing a quorum. As described above, no broker non-votes are expected in connection with the Proposals. A "broker non-vote" occurs when a broker, bank or other holder of record holding shares for a beneficial owner properly executes and returns a proxy without voting on a particular proposal because such holder of record does not have discretionary voting power for that particular item and has not received instructions from the beneficial owner. For purposes of the Special Meeting, a quorum requires 67,525,314 votes, or one-third of the aggregate number of our outstanding Common Stock and Preferred Stock (on an as-converted basis). The Series A Preferred Stock is convertible into 44,444,710 shares of Common Stock in the aggregate, and the Series B Preferred Stock is convertible into 11,111,333 shares of Common Stock in the aggregate.
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What vote is required to approve each proposal?
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A:
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The proposals to be voted upon at the Special Meeting have the following vote requirement:
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Q:
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May I change my vote?
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A:
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Yes. You may change your proxy instructions or revoke your proxy at any time prior to the vote at the Special Meeting. For shares held directly in your name, you may accomplish this by: (a) delivering a written notice of revocation to the Secretary of the Company or the Secretary's designated agent bearing a later date than the proxy being revoked, (b) signing and delivering a later dated written proxy relating to the same shares, or (c) attending the Special Meeting and voting in person (although attendance at the Special Meeting will not in and of itself constitute a revocation of a proxy). For shares held in street name, you may change your vote by submitting new voting instructions to your broker, trustee or nominee.
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Q:
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Who is paying for this proxy solicitation?
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A:
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We will pay the cost of soliciting proxies. Proxies may be solicited on behalf of the Company by directors, officers or employees of Abeona in person or by telephone, email or other electronic means. As required by the Securities and Exchange Commission (the "SEC"), we also will reimburse brokerage firms and other custodians, nominees and fiduciaries for their expenses incurred in sending proxies and proxy materials. We will pay Kingsdale Advisors an estimated fee of approximately $20,000 plus costs and expenses. In addition, Kingsdale Advisors and certain related persons will be indemnified against certain liabilities arising out of or in connection with the engagement.
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Q:
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Am I entitled to dissenters' rights?
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A:
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No dissenters' rights are available under the Delaware General Corporation Law, our Charter, or our Bylaws to any stockholder with respect to any of the matters proposed to be voted on at the Special Meeting.
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How can I find out the results of the voting at the Special Meeting?
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A:
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Preliminary voting results will be announced at the Special Meeting. In addition, final voting results will be published in a Current Report on Form 8-K that we expect to file within four business days after the completion of the Special Meeting.
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Name and Address of Beneficial Owner
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Amount and Nature of
Beneficial Ownership
Common Stock(1)
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Percent of
Common Stock(2)
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Directors and Named Executive Officers:
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Leila Alland, M.D.(3)
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175,349
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*
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Mark J. Alvino(4)
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180,349
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Michael Amoroso(5)
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1,045,277
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Faith L. Charles(3)
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175,349
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Paul Mann(6)
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87,674
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*
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Christine Silverstein(7)
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573,120
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Todd Wider, M.D.(6)
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87,674
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Donald A. Wuchterl(3)
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175,349
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Vishwas Seshadri(8)
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450,000
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*
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Edward Carr(9)
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183,183
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*
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Brendan O'Malley(10)
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305,402
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Joseph Vazzano(11)
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200,000
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*
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All Directors and Named Executive Officers as a group
(consisting of 12 persons)
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3,638,726
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2.5%
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5% Beneficial Owners:
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Steven H. Rouhandeh(12)
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14,052,364
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9.6%
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Adage Capital Partners, L.P.(13)
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8,007,272
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5.4%
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*
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Less than 1%
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(1)
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Includes outstanding shares of Common Stock held plus all shares of Common Stock issuable upon exercise of options, warrants and other rights exercisable within 60 days after April 27, 2022.
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(2)
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Based upon 147,019,899 shares of Common Stock issued and outstanding as of April 27, 2022.
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(3)
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Dr. Alland, Ms. Charles and Mr. Wuchterl are each known to beneficially own an aggregate of 77,181 shares of our Common Stock and presently exercisable options for the purchase of 98,168 shares pursuant to the 2015 Equity Incentive Plan.
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(4)
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Mr. Alvino is known to beneficially own an aggregate of 82,181 shares of our Common Stock and presently exercisable options for the purchase of 98,168 shares pursuant to the 2015 Equity Incentive Plan.
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(5)
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Mr. Amoroso is known to beneficially own an aggregate of 604,637 shares of our Common Stock and presently exercisable options for the purchase of 440,640 shares of our Common Stock pursuant to the 2015 Equity Incentive Plan.
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(6)
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Mr. Mann and Dr. Wider are each known to beneficially own an aggregate of 38,590 shares of our Common Stock and presently exercisable options for the purchase of 49,084 shares pursuant to the 2015 Equity Incentive Plan.
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(7)
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Ms. Silverstein is known to beneficially own an aggregate of 118,590 shares of our Common Stock and presently exercisable options for the purchase of 454,530 shares of our Common Stock pursuant to the 2015 Equity Incentive Plan.
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(8)
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Dr. Seshadri is known to beneficially own an aggregate of 350,000 shares of our Common Stock, and has options to purchase 100,000 shares of our Common Stock that vest within 60 days from April 27, 2022.
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(9)
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Mr. Carr is known to beneficially own an aggregate of 104,669 shares of our Common Stock and presently exercisable options for the purchase of 78,514 shares of our Common Stock pursuant to the 2015 Equity Incentive Plan.
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(10)
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Dr. O'Malley is known to beneficially own an aggregate of 204,750 shares of our Common Stock and presently exercisable options for the purchase of 100,652 shares of our Common Stock pursuant to the 2015 Equity Incentive Plan.
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(11)
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Mr. Vazzano is known to beneficially own an aggregate of 200,000 shares of our Common Stock.
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(12)
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Beneficial ownership for Mr. Rouhandeh includes (i) 503,590 shares held directly by Mr. Rouhandeh, (ii) presently exercisable options for the purchase of 1,024,114 shares pursuant to the 2015 Equity Incentive Plan, (iii) presently exercisable options for the purchase of
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(13)
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Based on information set forth in a Schedule 13G/A filed with the SEC on February 10, 2022 by Adage Capital Partners, L.P. and related entities. Adage Capital Partners L.P.'s address is 200 Clarendon Street, 52nd Floor, Boston, MA 02116.
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[147,019,899] shares of Common Stock; and
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1,250,011 shares of Preferred Stock.
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the Board believes effecting the reverse stock split will result in an increase in the minimum bid price of our Common Stock and allow the Company to have its Common Stock remain listed on The Nasdaq Capital Market;
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the Board believes that the increase in the number of available shares of Common Stock following the Reverse Stock Split will provide the Company with the ability to support its future anticipated growth and would provide greater flexibility to consider and respond to future business opportunities and needs as they arise, including equity financings and stock-based acquisitions of new technology and product development candidates;
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the Board believes a higher stock price may help generate investor interest in the Company and help the Company attract and retain employees.
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the market price per share of our Common Stock after the reverse stock split will rise in proportion to the reduction in the number of shares of our Common Stock outstanding before the reverse stock split;
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the reverse stock split will result in a per share price that will attract brokers and investors who do not trade in lower-priced stocks;
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the reverse stock split will result in a per share price that will increase the ability of the Company to attract and retain employees; or
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the market price per share will achieve the $1.00 minimum bid price requirement for a sufficient period for our Common Stock to regain compliance for continued listing on Nasdaq.
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persons who do not hold our Common Stock as a "capital asset" within the meaning of Section 1221 of the Code;
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brokers, dealers or traders in securities;
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banks, insurance companies, or other financial institutions;
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real estate investment trusts or regulated investment companies;
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tax-exempt entities, organizations or arrangements;
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governments or any agencies, instrumentalities or controlled entities thereof;
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treated as partnerships, S corporations, grantor trusts, disregarded entities or other pass-through entities or arrangements (or investors or holders of beneficial interests therein);
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liable for the alternative minimum tax under the Code;
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persons who hold their shares as part of a hedge, straddle, wash sale, synthetic security, conversion transaction or other integrated transaction;
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persons that have a functional currency other than the U.S. dollar;
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persons who hold shares of our Common Stock that may constitute "qualified small business stock" under Section 1202 of the Code or "Section 1244 stock" for purposes of Section 1244 of the Code;
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persons who acquired their shares of Common Stock in a transaction subject to the gain rollover provisions of Section 1045 of the Code;
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persons subject to special tax accounting rules as a result of any item of gross income being taken into account in an "applicable financial statement" (as defined in the Code);
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persons deemed to sell our Common Stock under the constructive sale provisions of the Code;
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persons who hold our Common Stock in a tax-deferred account (such as an individual retirement account or a plan qualifying under Section 401(k) of the Code);
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persons who acquired their shares of our Common Stock pursuant to the exercise of options or otherwise as compensation or through a retirement plan or through the exercise of a warrant or conversion rights under convertible instruments; and
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United States expatriates or former citizens or long-term residents of the United States.
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an individual who is a citizen or resident of the United States;
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a corporation or any other entity treated as a corporation created or organized in or under the laws of the United States, any state thereof, or the District of Columbia;
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an estate, the income of which is subject to U.S. federal income tax regardless of its source; or
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a trust if either (i) a court within the United States is able to exercise primary supervision over the administration of such trust, and one or more United States persons (within the meaning of Section 7701(a)(30) of the Code) is authorized or has the authority to control all substantial decisions of such trust, or (ii) the trust has a valid election in effect under applicable Treasury Regulations to be treated as a United States person for U.S. federal income tax purposes.
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May [ ], 2022
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BY ORDER OF THE BOARD OF DIRECTORS
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Vishwas Seshadri
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President and Chief Executive Officer
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1.
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The name of the Corporation is Abeona Therapeutics Inc.
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2.
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The Restated Certificate of Incorporation of the Corporation is hereby amended by adding at the end of Article V the following new paragraph:
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3.
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The foregoing amendment has been duly adopted by the board of directors of the Corporation and the holders of a majority of the issued and outstanding shares of capital stock of the Corporation entitled to vote thereon at the special meeting of stockholders of the Corporation held on _____, 2022 pursuant to Sections 141 and 242 of the DGCL.
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4.
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This Certificate of Amendment shall be effective on ______, 2022 at Eastern Time.
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Vishwas Seshadri President
and Chief Executive Officer
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