pre14a.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
SCHEDULE
14A
(Rule
14a-101)
INFORMATION
REQUIRED IN PROXY STATEMENT
SCHEDULE
14A INFORMATION
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
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Filed
by the Registrant
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[X]
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Filed
by a Party other than the Registrant
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[ ]
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Check
the appropriate box:
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[X]
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Preliminary
Proxy Statement
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[ ]
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Confidential,
For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
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[ ]
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Definitive
Proxy Statement
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Definitive
Additional Materials
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Soliciting
Material Pursuant to Section
240.14a-12
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BIORESTORATIVE
THERAPIES, INC.
(Name
of Registrant as Specified in its Charter)
(Name of
Person(s) Filing Proxy Statement, if Other Than the Registrant)
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Payment
of Filing Fee (Check the appropriate box):
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[X]
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No
fee required
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[ ]
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Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
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1)
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Title
of each class of securities to which transaction applies:
not
applicable
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2)
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Aggregate
number of securities to which transaction applies:
not
applicable
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3)
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Per
unit price or
other underlying value
of transaction computed pursuant to
Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
not
applicable
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4)
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Proposed
maximum aggregate value of transaction:
not
applicable
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5)
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Total
fee paid:
not
applicable
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[ ]
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Fee
paid previously with preliminary materials:
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[ ]
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Check
box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which
the offsetting fee was paid
previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its
filing.
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1)
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Amount
previously paid:
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2)
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Form,
Schedule or Registration Statement No.:
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3)
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Filing
Party:
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4)
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Date
Filed:
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BIORESTORATIVE
THERAPIES, INC.
555
Heritage Drive
Jupiter,
Florida 33458
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
TO
BE HELD ON FEBRUARY 10, 2012
To the
Shareholders of BioRestorative Therapies, Inc.:
NOTICE IS HEREBY GIVEN that
the Annual Meeting of Shareholders of BioRestorative Therapies, Inc., a Nevada
corporation (the “Company”), will be held on February 10, 2012 at 90 Merrick
Avenue, 9th
Floor, East Meadow, New York, at 4:00 p.m., local time, for the following
purposes:
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1.
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To
elect three directors for the coming
year.
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2.
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To
approve an amendment to the Company’s Articles of Incorporation to
increase the number of shares of common stock authorized to be issued by
the Company from 800,000,000 to
1,500,000,000.
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3.
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To
authorize the Board of Directors of the Company to effect a reverse stock
split of the Company’s common stock by a ratio of not less than 1-for-10
and not more than 1-for-150, with the Board of Directors of the Company
having the discretion as to whether or not the reverse split is to be
effected, and with the exact ratio of any reverse split to be set at a
whole number within the above range as determined by the Company’s Board
of Directors in its discretion.
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4.
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To
transact such other business as may properly come before the
meeting.
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Only
shareholders of record at the close of business on December 16, 2011 are
entitled to notice of and to vote at the meeting or at any adjournment
thereof.
Important notice regarding the
availability of Proxy Materials: The proxy statement, the Company’s
General Form for Registration of Securities on Form 10, as amended, and the
Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2011
are available electronically to the Company’s shareholders of record as of the
close of business on December 16, 2011 at www.proxyvote.com.
Mark
Weinreb
Chief
Executive Officer
Jupiter,
Florida
December ,
2011
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WHETHER
OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SUBMIT YOUR PROXY OR VOTING
INSTRUCTIONS AS SOON AS POSSIBLE. FOR SPECIFIC INSTRUCTIONS ON
HOW TO VOTE YOUR SHARES, PLEASE REFER TO THE INSTRUCTIONS ON THE NOTICE
REGARDING THE AVAILABLITY OF PROXY MATERIALS YOU RECEIVED IN THE MAIL OR,
IF YOU REQUESTED TO RECEIVE PRINTED PROXY MATERIALS, YOUR ENCLOSED PROXY
CARD. ANY SHAREHOLDER MAY REVOKE A SUBMITTED PROXY AT ANY TIME
BEFORE THE MEETING BY WRITTEN NOTICE TO SUCH EFFECT, BY SUBMITTING A
SUBSEQUENTLY DATED PROXY OR BY ATTENDING THE MEETING AND VOTING IN
PERSON. THOSE VOTING BY INTERNET OR BY TELEPHONE MAY ALSO
REVOKE THEIR PROXY BY VOTING IN PERSON AT THE MEETING OR BY VOTING AND
SUBMITTING THEIR PROXY AT A LATER TIME BY INTERNET OR BY
TELEPHONE.
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BIORESTORATIVE
THERAPIES, INC.
555
Heritage Drive
Jupiter,
Florida 33458
____________________________
PROXY
STATEMENT
____________________________
SOLICITING,
VOTING AND REVOCABILITY OF PROXY
This
proxy statement is being mailed or made available to all shareholders of record
at the close of business on December 16, 2011 in connection with the
solicitation by our Board of Directors of proxies to be voted at the Annual
Meeting of Shareholders to be held on February 10, 2012 at 4:00 p.m., local
time, or any adjournment thereof. Proxy materials for the Annual
Meeting of Shareholders were mailed or made available to shareholders on or
about December __, 2011.
All
shares represented by proxies duly executed and received will be voted on the
matters presented at the meeting in accordance with the instructions specified
in such proxies. Proxies so received without specified instructions
will be voted as follows:
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(i)
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FOR the nominees named
in the proxy to our Board of
Directors.
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(ii)
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FOR the proposal to
amend our Articles of Incorporation to increase the number of shares of
common stock authorized to be issued from 800,000,000 to
1,500,000,000.
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(iii)
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FOR the proposal to
authorize our Board of Directors to effect a reverse stock split of our
common stock by a ratio of not less than 1-for-10 and not more than
1-for-150, with our Board of Directors having the discretion as to whether
or not the reverse split is to be effected, and with the exact ratio of
any reverse split to be set at a whole number within the above range as
determined by our Board in its
discretion.
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If you
are a beneficial owner of shares held in street name and you do not provide
specific voting instructions to the organization that holds your shares, the
organization will be prohibited under the current rules of the New York Stock
Exchange from voting your shares on "non-routine" matters. This is commonly
referred to as a "broker non-vote". The election of directors and the proposals
to amend the Plan and to effect a reverse split are considered "non-routine"
matters and therefore may not be voted on by your bank or broker absent specific
instructions from you. The proposal to amend our Articles of Incorporation to
increase the number of authorized shares is considered "routine" and therefore
may be voted on by your bank or broker without instructions from
you. Please instruct your bank or broker so your vote can be
counted.
Our Board
does not know of any other matters that may be brought before the meeting nor
does it foresee or have reason to believe that the proxy holder will have to
vote for substitute or alternate nominees to the Board. In the event
that any other matter should come before the meeting or any nominee is not
available for election, the person named in the enclosed proxy will have
discretionary authority to vote all proxies not marked to the contrary with
respect to such matters in accordance with his best judgment.
The total
number of shares of common stock outstanding and entitled to vote as of the
close of business on December 16, 2011 was 603,683,811. The shares of
common stock are the only class of securities entitled to vote on matters
presented to our shareholders, each share being entitled to one
vote.
The
holders of one-third of the shares of common stock outstanding as of the close
of business on December 16, 2011, or 201,227,937 shares of common stock, must be
present at the meeting in person or by proxy in order to constitute a quorum for
the transaction of business. Proxies received but marked as
abstentions will be included in the calculation of votes considered being
present at the meeting.
With
regard to the election of directors, votes may be cast in favor or
withheld. The directors shall be elected by a plurality of the votes
cast in favor. Accordingly, based upon there being three nominees,
each person who receives one or more votes will be elected as a
director. Shares of common stock as to which a shareholder withholds
voting authority in the election of directors and broker non-votes will not be
counted as voting thereon and therefore will not affect the election of the
nominees receiving a plurality of the votes cast.
Shareholders
may expressly abstain from voting on Proposals 2 and 3 by so indicating on the
proxy. Abstentions are counted as present in the tabulation of votes
on Proposals 2 and 3. Since Proposals 2 and 3 require the affirmative
approval of a majority of the shares of common stock outstanding and entitled to
vote (assuming a quorum is present at the meeting), abstentions, as well as
broker non-votes, will have the effect of a negative vote.
Any
person giving a proxy in the form accompanying this proxy statement has the
power to revoke it at any time before its exercise. The proxy may be
revoked by filing with us written notice of revocation or a fully executed proxy
bearing a later date. The proxy may also be revoked by affirmatively
electing to vote in person while in attendance at the
meeting. However, a shareholder who attends the meeting need not
revoke a proxy given and vote in person unless the shareholder wishes to do
so. Written revocations or amended proxies should be sent to us at
555 Heritage Drive, Suite 130, Jupiter, Florida 33458, Attention: Corporate
Secretary. Those voting by Internet or by telephone may also revoke
their proxy by voting in person at the meeting or by voting and submitting their
proxy at a later time by Internet or by telephone.
The proxy
is being solicited by our Board of Directors. We will bear the cost
of the solicitation of proxies, including the charges and expenses of brokerage
firms and other custodians, nominees and fiduciaries for forwarding proxy
materials to beneficial owners of our shares. Solicitations will be
made primarily by Internet availability of proxy materials and by mail, but
certain of our directors, officers or employees may solicit proxies in person or
by telephone, telecopier or email without special compensation.
EXECUTIVE
COMPENSATION
The
following Summary Compensation Table sets forth all compensation earned in all
capacities during the fiscal years ended December 31, 2010 and 2009 by our (i)
principal executive officer, (ii) our former principal executive officer and
(iii) all other executive officers, other than our principal executive officer,
whose salaries for the 2010 fiscal year, as determined by Regulation S-K, Item
402, exceeded $100,000 (the individuals falling within categories (i), (ii) and
(iii) are collectively referred to as the “Named Executive
Officers”):
Summary
Compensation Table
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Name
and Principal Position
|
Year
|
Salary
|
Bonus
|
Stock
Awards
|
Option
Awards
|
Nonequity
Incentive
Plan
Compensation
|
Nonqualified
Deferred Compensation Earnings
|
All
Other
Compensation
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Total
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|
Mark
Weinreb, Chief
Executive
Officer(1)
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2010
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$90,000
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$45,000(3)
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-
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$437,234(4)(6)
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-
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-
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-
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$572,234
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2009
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-
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-
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-
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-
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-
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-
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-
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-
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Gloria
McConnell,
President(2)
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2010
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$26,667
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-
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$103,884(4)(5)
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-
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-
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-
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$120,000(5)
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$250,551
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2009
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-
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-
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-
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-
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-
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-
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-
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-
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____________________
(1) Mr.
Weinreb became our Chief Executive Officer in October
2010.
(2) Ms.
McConnell served as our President from January 2009 to December
2010.
(3)
Pursuant to Mr. Weinreb’s employment agreement with us, he is entitled to
receive a bonus equal to 50% of his annual salary. See “Employment
Agreement” below.
(4) The
amounts reported in these columns represent the grant date fair value of the
option and stock awards granted during the year ended December 31, 2010,
calculated in accordance with FASB ASC Topic 718. For a detailed
discussion of the assumptions used in estimating fair values, see Item 2 of our
General Form for Registration of Securities on Form 10, as amended (“Financial
Information - Stock-Based Compensation”), incorporated herein by
reference.
(5)
Represents amounts payable to Ms. McConnell pursuant to a termination
agreement. As discussed in “Termination Agreement” and “Certain
Relationships and Related Transactions” below, pursuant to the termination
agreement, Ms. McConnell was entitled to receive $120,000, as severance, payable
over a two year period and to be reissued 12,576,811 shares of common stock she
had previously contributed to capital as an accommodation to us. The
shares reissued to Ms. McConnell had previously been owned by
her. She had contributed them to our capital as an accommodation to
us since we did not then have a sufficient number of authorized shares to issue
shares to third parties. When our authorized capitalization was
increased, Ms. McConnell was reissued her shares. See “Certain
Relationships and Related Transactions” below. Pursuant to a
settlement agreement entered into between Ms. McConnell and us in November 2011,
the severance amount was reduced to $55,000 and she was paid the balance due to
her.
(6) Includes
$404,751 related to a purported grant to Mr. Weinreb of an option for the
purchase of 50,000,000 shares of common stock. Such grant was
determined to be null and void.
Outstanding
Equity Awards at Fiscal Year-End
The
following table provides information on outstanding equity awards as of December
31, 2010 to the Named Executive Officers:
|
|
Option
Awards
|
Stock
Awards
|
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Name
|
Number
of Securities Underlying Unexercised Options Exercisable
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Number
of Securities Underlying Unexercised Options Unexercisable
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised
Unearned Options
|
Option
Exercise Price
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Option
Expiration Date
|
Number
of Shares or Units of Stock That Have Not Vested
|
Market
Value of Shares or Units of Stock That Have Not Vested
|
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights
That Have Not Vested
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Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or
Other Rights That Have Not Vested
|
|
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4,000,000
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-
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-
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$0.01
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12/14/20
|
-
|
-
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-
|
-
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Gloria
McConnell
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-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
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Employment
Agreement
On
October 4, 2010, we entered into a three-year employment agreement with Mark
Weinreb, our Chief Executive Officer. Pursuant to the employment
agreement, Mr. Weinreb is entitled to receive a salary of $360,000, $480,000 and
$600,000 per annum during the three-year term and an annual bonus equal to 50%
of his annual salary. In addition, pursuant to the employment
agreement, in the event that Mr. Weinreb’s employment is terminated by us
without cause, or Mr. Weinreb terminates his employment for “good reason” or
following a change in control, Mr. Weinreb would be entitled to receive a lump
sum payment equal to the greater of (a) his base annual salary and bonus for the
remainder of the term or (b) two times his then annual base salary and
bonus. In addition, pursuant to the employment agreement, as amended,
in January 2011 and May 2011, we granted to Mr. Weinreb 15,000,000 and
35,000,000 shares of common stock, respectively. In connection with
the stock grants, we agreed to pay all taxes payable by Mr. Weinreb as a result
of the grants as well as all taxes incurred as a result of the tax payments made
on his behalf. We and Mr. Weinreb initially agreed that the
35,000,000 share grant would not vest until we received equity and/or debt
financing in an aggregate amount equal to three times the tax payable in
connection with the grant. On November 4, 2011, we and Mr. Weinreb
agreed that the 35,000,000 share grant will not vest until we receive equity
and/or debt financing after such date of at least $2,000,000.
Termination
Agreement
In
December 2010, we entered into a termination agreement with Gloria McConnell,
our former President. See the discussion of this agreement in
“Certain Relationships and Related Transactions” below.
DIRECTOR
COMPENSATION
The
following table sets forth certain information concerning the compensation of
our non-employee directors for the fiscal year ended December 31,
2010:
|
Director
Compensation
|
|
Name
|
Fees
Earned or Paid in Cash
|
Stock
Awards(1)
|
Option
Awards(1)
|
Non-Equity
Incentive Plan Compensation
|
Nonqualified
Deferred Compensation Earnings
|
All
Other Compensation
|
Total
|
|
Dr.
Kurt J. Wagner(2)
|
-
|
$61,775
|
$32,365
|
-
|
-
|
-
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$94,140
|
|
Dr.
Joseph J. Ross(2)
|
-
|
$13,800
|
$32,365
|
-
|
-
|
-
|
$46,165
|
______________________
(1) The
amounts reported in this column represent the grant date fair value of the stock
and option awards granted during the year ended December 31, 2010, calculated in
accordance with FASB ASC Topic 718. For a detailed discussion of the
assumptions used in estimating fair values, see Item 2 of our General Form for
Registration of Securities on Form 10, as amended (“Financial Information -
Stock-Based Compensation”), incorporated herein by reference.
(2) Resigned
as a director in April 2011.
Upon
their appointment in April 2011, Messrs. Radov and San Antonio, our non-employee
directors, each became entitled to receive compensation for his services as a
director as follows:
|
·
|
$20,000 per annum, payable quarterly (subject to our cash
needs)
|
|
·
|
5,000,000 shares of common stock which vest to the extent of 50% upon
grant and 50% after one year
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS
AND MANAGEMENT
The
following table sets forth certain information regarding the beneficial
ownership of our common stock, as of December 16, 2011, known by us, through
transfer agent records, to be held by: (i) each person who beneficially owns 5%
or more of the shares of common stock then outstanding; (ii) each of our
directors; (iii) each of our Named Executive Officers (as defined above); and
(iv) all of our directors and executive officers as a group.
The
information in this table reflects “beneficial ownership” as defined in Rule
13d-3 of the Exchange Act. To our knowledge, and unless otherwise
indicated, each shareholder has sole voting power and investment power over the
shares listed as beneficially owned by such shareholder, subject to community
property laws where applicable. Percentage ownership is based on
603,683,811 shares of common stock outstanding as of December 16,
2011.
|
Name
and Address
of Beneficial Owner
|
|
Number
of Shares Beneficially
Owned
|
|
|
Approximate
Percent of Class
|
|
|
Mark
Weinreb
555
Heritage Drive
Jupiter,
Florida
|
|
|
165,642,991 |
(1) |
|
|
27.3 |
% |
| |
|
|
|
|
|
|
|
|
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Gloria
McConnell
1260
NW 16th
Street
Boca
Raton, Florida
|
|
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46,120,382 |
(2) |
|
|
7.6 |
% |
| |
|
|
|
|
|
|
|
|
|
Westbury
(Bermuda) Ltd.
Victoria
Hall
11
Victoria Street
Hamilton,
Bermuda
|
|
|
35,750,000 |
|
|
|
5.9 |
% |
| |
|
|
|
|
|
|
|
|
|
A.
Jeffrey Radov
8
Walworth Avenue
Scarsdale,
New York
|
|
|
12,500,000 |
(3) |
|
|
* |
|
| |
|
|
|
|
|
|
|
|
|
Joel
San Antonio
2200
Highway 121
Bedford,
Texas
|
|
|
12,500,000 |
(3) |
|
|
* |
|
| |
|
|
|
|
|
|
|
|
|
All
directors and executive officers as a group (5 persons)
|
|
|
199,142,991 |
(1)(3)(4) |
|
|
32.4 |
% |
_____________________
(1) Includes
(a) 4,000,000 shares of common stock issuable upon the exercise of currently
exercisable options, (b) 35,000,000 shares of common stock issued subject to the
receipt of additional financing, as described in “Executive Compensation -
Employment Agreement” above; (c) 41,034,483 shares of common stock held of
record by Gloria McConnell over which Mr. Weinreb has voting power pursuant to a
Shareholder Agreement and Irrevocable Proxy, dated January 20, 2011 (the
“McConnell Shareholder Agreement”), as described in footnote (2) below, (d)
5,085,899 shares of common stock held of record by Stem Cell Research Company,
LLC (“Stem Cell Research”) over which Mr. Weinreb has voting power pursuant to a
Shareholder Agreement and Irrevocable Proxy, dated January 21, 2011 (the
“Research Shareholder Agreement”), as described in footnote (2) below, (e)
21,522,609 shares of common stock held of record by Richard Proodian over which
Mr. Weinreb has voting power pursuant to a Shareholder Agreement and Irrevocable
Proxy, dated June 15, 2011, (f) 9,000,000 shares of common stock held of record
by John Krowiak over which Mr. Weinreb has voting power pursuant to two
Shareholder Agreement and Irrevocable Proxy documents, dated June 6, 2011 and
June 13, 2011 and (g) 35,000,000 shares of common stock which are pledged as
security for the payment of a promissory note.
(2) Includes
5,085,899 shares of common stock held of record by Stem Cell Research of which,
we have been advised, Ms. McConnell is the President and sole
member. Pursuant to the McConnell Shareholder Agreement, for a period
of three years ending January 20, 2014, Ms. McConnell has agreed to vote her
shares of common stock as directed by Mr. Weinreb and has granted to Mr. Weinreb
an irrevocable proxy in connection therewith. Pursuant to the
Research Shareholder Agreement, for a period of three years ending January 21,
2014, Stem Cell Research has agreed to vote its shares as directed by Mr.
Weinreb and has granted to Mr. Weinreb an irrevocable proxy in connection
therewith.
(3) Includes
2,500,000 shares of common stock issued subject to continued service as a
director until April 21, 2012.
(4) Includes
7,250,000 shares of common stock issuable upon the exercise of currently
exercisable options.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
In
September 2009, certain of our then executive officers, directors, and 5% or
greater shareholders contributed to our capital a total of 71,379,312 of the
301,999,999 shares of common stock received by them in connection with our April
2009 acquisition of Stem Cell Assurance, LLC. Such capital
contribution was made in order to allow us to have sufficient authorized and
unissued shares of common stock to use in connection with our capital-raising
efforts and without additional consideration to the executive officers,
directors or shareholders. The number of shares contributed is as
follows:
|
Name
|
|
Total Number of Shares
Contributed
|
|
|
|
|
|
|
|
Dr.
Richard Ferrans
|
|
|
5,172,414 |
|
|
Gloria
J. McConnell
|
|
|
10,344,818 |
(1) |
|
Richard
M. Proodian
|
|
|
10,344,818 |
|
|
George
Edward Dubec
|
|
|
5,172,414 |
|
|
Stem
Cell Research Company, LLC
|
|
|
40,344,828 |
|
____________________
|
(1)
|
Includes
shares indirectly owned by Ms.
McConnell.
|
In
October 2010, certain of our then executive officers, directors, 5% or greater
shareholders and consultants contributed to our capital an additional 60,332,799
shares. Such additional capital contribution was made in order to
enable us to have sufficient authorized and unissued shares of common stock in
connection with our capital-raising efforts and for other corporate purposes and
without additional consideration to the executive officers, directors,
shareholders or consultants. The number of additional shares
contributed is as follows:
|
Name
|
|
Total Number of Shares
Contributed
|
|
|
|
|
|
|
|
Gloria
J. McConnell
|
|
|
12,576,811 |
|
|
Richard
M. Proodian
|
|
|
9,511,874 |
|
|
Stem
Cell Research Company, LLC
|
|
|
32,082,535 |
|
|
Todd
Adler
|
|
|
6,161,579 |
|
On
December 15, 2010, we entered into a termination agreement with Gloria
McConnell, our former President (the “McConnell Termination Agreement”),
pursuant to which Ms. McConnell was entitled to receive $120,000,
as severance, payable over a two year period. In addition, pursuant
to the McConnell Termination Agreement, we agreed to reissue to Ms. McConnell
12,576,811 shares of our common stock. These shares had previously
been contributed to capital by Ms. McConnell in October 2010 in order to enable
us to fulfill our obligation to issue shares to third
parties. Further, pursuant to the McConnell Termination Agreement,
Ms. McConnell has agreed to certain restrictive covenants, including
non-competition and non-solicitation restrictions, and limitations on the number
of shares that she can sell to 250,000 shares on any particular day and
5,000,000 shares during any three calendar month period. In November
2011, we entered into an agreement with Ms. McConnell pursuant to which we paid
her $22,500 in full settlement of our outstanding $87,500 obligation to
her.
On
January 20, 2011, Ms. McConnell and Mr. Weinreb entered into a Shareholder
Agreement and Irrevocable Proxy, pursuant to which Ms. McConnell has agreed
that, for a period of three years, she would vote her shares of common stock as
determined by Mr. Weinreb.
Effective
January 29, 2011, we terminated our relationship with Tommy Berger, a founder of
the Company. Pursuant and subject to the terms and conditions of a
termination agreement between the parties (the “Berger Termination Agreement”),
Mr. Berger waived any rights he may have had pursuant to a certain employment
agreement entered into with us in August 2010 (to which Stem Cell Research
Company, LLC (“Stem Cell Research”) was also a party) (the “Berger Employment
Agreement”) and we agreed to pay to Stem Cell Research $180,000 over a 12 month
period. In addition, pursuant to the Berger Termination Agreement,
each of Mr. Berger and Stem Cell Research has agreed to certain restrictive
covenants, including non-competition and non-solicitation restrictions,
restrictions on actions that would cause a change of control and limitations on
the number of shares that they can sell to 250,000 shares on any particular day
and 5,000,000 shares during any three calendar month period. Further,
concurrently with the execution of the Berger Termination Agreement, in
connection with our agreement to pay to Stem Cell Research the $180,000 payment
discussed above, Stem Cell Research executed a shareholder agreement and
irrevocable proxy pursuant to which it has agreed that, for a three year period,
it would vote its shares of common stock as directed by Mr.
Weinreb. We are aware that, in the Berger Employment Agreement, Stem
Cell Research was referred to as Mr. Berger’s “company”; however, we have no
knowledge as to any control that Mr. Berger may currently exercise with respect
to Stem Cell Research and, as previously indicated, we have been advised that
Ms. McConnell is the President and sole member of Stem Cell
Research. In November 2011, we entered into an agreement with Stem
Cell Research and Mr. Berger pursuant to which we paid Stem Cell Research
$50,000 in full settlement of our outstanding $100,000 obligation to
it.
On June 17, 2011, Richard Proodian, our
former Chief Financial Officer, executed a termination agreement with us (the
“Proodian Termination Agreement”) pursuant to which Mr. Proodian is entitled to
receive, as severance, $50,000 (less amounts paid as salary for the period after
June 15, 2011), payable over the balance of 2011. In addition,
pursuant to the Proodian Termination Agreement, Mr. Proodian has agreed to
certain restrictive covenants, including non-competition and non-solicitation
restrictions, and limitations on the number of shares that he can sell to
250,000 shares on any particular day and 5,000,000 shares during any three
calendar month period. Further, in connection with the execution of
the Proodian Termination Agreement, Messrs. Proodian and Weinreb entered into a
Shareholder Agreement and Irrevocable Proxy pursuant to which Mr. Proodian has
agreed that, for a period of three years, he would vote his shares of common
stock as determined by Mr. Weinreb.
PROPOSAL
1: ELECTION OF DIRECTORS
Three
directors are to be elected at the meeting to serve until the next annual
meeting of shareholders and until their respective successors shall have been
elected and have qualified.
Nominees
for Directors
All three
nominees are currently members of our Board of Directors. The
following table sets forth each nominee’s age as of December 8, 2011, the
positions and offices presently held with us, and the year in which he became a
director.
|
Name
|
Age
|
Positions
Held
|
Director
Since
|
|
Mark
Weinreb
|
58
|
Chief
Executive Officer, Chairman of the Board
and
Director
|
2010
|
|
A.
Jeffrey Radov
|
59
|
Director
|
2011
|
|
Joel
San Antonio
|
59
|
Director
|
2011
|
Mark
Weinreb
Mark
Weinreb has served as our Chief Executive Officer since October 2010 and as our
Chairman of the Board since April 2011. From February 2003 to October
2009, Mr. Weinreb served as President of NeoStem, Inc., a public international
biopharmaceutical company engaged in, among other things, adult stem
cell-related operations. From October 2009 to October 2010, he was
subject to a non-competition agreement with NeoStem and was not engaged in
business. Mr. Weinreb also served as Chief Executive Officer and
Chairman of the Board of Directors of NeoStem from February 2003 to June
2006. In 1976, Mr. Weinreb joined Bio Health Laboratories, Inc., a
state-of-the-art medical diagnostic laboratory providing clinical testing
services for physicians, hospitals, and other medical
laboratories. He became the laboratory administrator in 1978 and then
an owner and the laboratory’s Chief Operating Officer in 1982. In
such capacity, he oversaw all technical and business facets, including finance
and laboratory science technology. Mr. Weinreb left Bio Health Labs
in 1989 when the business was sold. In 1992, Mr. Weinreb founded Big
City Bagels, Inc., a national chain of franchised upscale bagel bakeries and
became Chairman and Chief Executive Officer of such entity. Big City
Bagels went public in 1995, and in 1999 Mr. Weinreb redirected the company and
completed a merger with an Internet service provider. From 2000 to
2002, Mr. Weinreb served as Chief Executive Officer of Jestertek, Inc., a
software development company pioneering gesture recognition and control using
advanced interactive proprietary video technology. Mr. Weinreb
received a Bachelor of Arts degree in 1975 from Northwestern University and a
Master of Science degree in 1982 in Medical Biology from C.W. Post, Long Island
University. We believe that Mr. Weinreb’s executive-level management
experience, his extensive experience in the adult stem cell sector and his
service on our Board since October 2010 give him the qualifications and skills
to serve as one of our directors.
A. Jeffrey
Radov
A.
Jeffrey Radov became a member of our Board in April 2011. Mr. Radov
is an entrepreneur and businessman with 35 years of experience in media,
communications and financial endeavors. Since 2002, he has served as
the Managing Partner of Walworth Group, which provides consulting and advisory
services to a variety of businesses, including hedge funds, media, entertainment
and Internet companies, financial services firms and early stage
ventures. Mr. Radov is also an advisor to GeekVentures, LLC, an
incubator for technology startups in Israel. From 2008 to 2010, Mr.
Radov was a Principal and Chief Operating Officer at Aldebaran Investments, LLC,
a registered investment advisor. From 2005 to 2008, Mr. Radov was
Chief Operating Officer at EagleRock Capital Management, a group of hedge
funds. Prior to joining EagleRock, Mr. Radov was a founding investor
in and Board member of Edusoft, Inc., an educational software
company. From 2001 to 2002, Mr. Radov was a Founder-in-Residence at
SAS Investors, an early-stage venture fund. From 1999 to 2001, Mr.
Radov was CEO and Co-Founder of VocaLoca, Inc., an innovator in
consumer-generated audio content on the Internet. Mr. Radov was a
founding executive of About.Com, Inc., an online information source, and was its
EVP of Business Development and Chief Financial Officer from its
inception. In 1996, prior to founding About.Com, Mr. Radov was a
Director at Prodigy Systems Company, a joint venture of IBM and
Sears. Mr. Radov was also a principal in the management of a series
of public limited partnerships that invested in the production and distribution
of more than 130 major motion pictures. From 1982 to 1984, Mr. Radov
was the Director of Finance at Rainbow Programming Enterprises, a joint venture
among Cablevision Systems Corporation, Cox Broadcasting and Daniels &
Associates. From 1977 to 1981, Mr. Radov was Director of Marketing at
Winklevoss & Associates. Mr. Radov earned a Masters of Business
Administration from The Wharton School of the University of Pennsylvania and
holds a Bachelor of Arts degree from Cornell University. We believe
that Mr. Radov’s executive-level management experience and his extensive
experience in the finance industry give him the qualifications and skills to
serve as one of our directors.
Joel
San Antonio
Joel San
Antonio became a member of our Board in April 2011. Since August
2010, Mr. San Antonio has served as Chairman of Warrantech/AMT Warranty, an
operating subsidiary of Amtrust Financial Services Inc. From February
1988 through August 2010, he was Chairman and Chief Executive Officer of
Warrantech Corporation, a leading provider of third party administration for
insurance products. Warrantech was acquired by Amtrust Financial
Services in 2010. Prior to founding Warrantech, Mr. San Antonio
founded Little Lorraine Ltd., a company engaged in the manufacture of various
brands of women’s apparel. Mr. San Antonio has served as Chairman of
the Board of American Doctors Network, a technology company engaged in the
development of electronic medical records. He is a former Board
member of SearchHelp Inc., a company committed to online child protection and
family safety, MedStrong International Corporation, a company engaged in the
storage of emergency medical information, and Marc Pharmaceuticals, Inc., a
company that, in conjunction with the Weil Medical Center at Cornell University,
was engaged in the development and commercialization of cancer treatment
products. Mr. San Antonio is engaged in a variety of philanthropic
and charitable activities. Mr. San Antonio graduated from Ithaca
College with a Bachelor of Science in Business Administration. We
believe that Mr. Antonio’s executive-level management experience gives him the
qualifications and skills to serve as one of our directors.
Family
Relationships
There are
no family relationships among any of our executive officers and
directors.
Term
of Office
Each
director will hold office until the next annual meeting of shareholders and
until his successor is elected and qualified or until his earlier resignation
and removal.
Committees
Audit
Committee
The Audit
Committee of the Board of Directors is responsible for overseeing our accounting
and financial reporting processes and the audits of our financial statements.
The responsibilities and duties of the Audit Committee include the
following:
|
·
|
assist
the Board of Directors in fulfilling its responsibilities by reviewing the
financial reports provided by us to the Securities and Exchange
Commission, our shareholders or to the general public, and our internal
financial and accounting controls,
|
|
·
|
oversee
the appointment, compensation, retention and oversight of the work
performed by any independent public accountants engaged by
us,
|
|
·
|
recommend,
establish and monitor procedures designed to improve the quality and
reliability of the disclosure of our financial condition and results of
operations,
|
|
·
|
recommend,
establish and monitor procedures designed to
facilitate
|
|
·
|
the
receipt, retention and treatment of complaints relating to accounting,
internal accounting controls or auditing matters
and
|
|
·
|
the
receipt of confidential, anonymous submissions by employees of concerns
regarding questionable accounting or auditing
matters.
|
The
members of our Board’s Audit Committee currently are Messrs. Radov and San
Antonio. Our Board has adopted a written charter for the Audit Committee. A copy
of the charter is available on our website, www.biorestorative.com.
Nominating
Committee
The
Nominating Committee of the Board of Directors is responsible for assisting the
Board in identifying and recruiting qualified individuals to become Board
members and selecting director nominees to be presented for Board and/or
shareholder approval. The members of the Nominating Committee currently are
Messrs. Radov and San Antonio. Our Board has adopted a written charter for the
Nominating Committee. A copy of the charter is available on our website, www.biorestorative.com.
While the Nominating Committee does not have a formal policy on diversity for
members of the Board of Directors, the Nominating Committee considers diversity
of background, experience and qualifications in evaluating prospective Board
members. The Nominating Committee will consider qualified director candidates
recommended by shareholders if such recommendations are provided in accordance
with the procedures set forth in the section entitled “Shareholder Proposals -
Shareholder Nominees” below. At this time, the Nominating Committee has not
adopted minimum criteria for consideration of a proposed candidate for
nomination.
Compensation
Committee
The
Compensation Committee of the Board of Directors is responsible for the
management of our business and affairs with respect to the compensation of our
employees, including the determination of the compensation for our Chief
Executive Officer and our other executive officers, the approval of one or more
stock option plans and other compensation plans covering our employees, and the
grant of stock options and other awards pursuant to stock option plans and other
compensation plans. The members of the Compensation Committee currently are
Messrs. Radov and San Antonio. Our Board has adopted a written
charter for the Compensation Committee. A copy of the charter is available on
our website, www.biorestorative.com.
The
Compensation Committee may form and delegate authority to subcommittees and may
delegate authority to one or more designated members of the Compensation
Committee. Our Chief Executive Officer assists the Compensation Committee from
time to time by advising on a variety of compensation matters, such as assisting
the Compensation Committee in determining appropriate salaries and bonuses for
our executive officers. The Compensation Committee has the authority to consult
with management and to engage the services of outside advisors, experts and
others to assist it in its efforts.
Board
Leadership Structure and Role in Risk Oversight
Our Board
of Directors as a whole is responsible for our risk oversight. Our executive
officers address and discuss with our Board of Directors our risks and the
manner in which we manage or mitigate such risks. While our Board of Directors
has the ultimate responsibility for our risk oversight, our Board of Directors
works in conjunction with its committees on certain aspects of its risk
oversight responsibilities. In particular, our Audit Committee focuses on
financial reporting risks and related controls and procedures and our
Compensation Committee strives to create compensation practices that do not
encourage excessive levels of risk taking that would be inconsistent with our
strategies and objectives.
Since
October 2010, Mark Weinreb has served as our Chief Executive
Officer. Since April 2011, he has also served as our Chairman of the
Board. We do not currently have a lead independent director. At this time, our
Board believes that Mr. Weinreb’s combined role as Chief Executive Officer and
Chairman of our Board enables us to benefit from Mr. Weinreb’s significant
institutional and industry knowledge and experience, while at the same time
promoting unified leadership and direction for our Board and executive
management without duplication of effort and cost. Given our history, position,
Board composition and the relatively small size of our company and management
team, at this time, our Board believes that we and our shareholders are best
served by our current leadership structure.
Report
of the Audit Committee
In
overseeing the preparation of the financial statements of BioRestorative
Therapies, Inc. (the “Company”) as of December 31, 2010 and 2009, for the years
then ended and for the period from December 30, 2008 (inception) to December 31,
2010, the Audit Committee met with management to review and discuss all
financial statements prior to their issuance and to discuss significant
accounting issues. Management advised the Committee that all financial
statements were prepared in accordance with generally accepted accounting
principles, and the Committee discussed the statements with management. The
Committee also discussed with Marcum LLP, the Company’s independent registered
accounting firm (“Marcum”), the matters required to be discussed by Statement on
Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol.
1 AU section 380), as adopted by the Public Company Accounting Oversight Board
in Rule 3200T.
The
Committee received the written disclosures and the letter from Marcum required
by applicable requirements of the Public Company Accounting Oversight Board
regarding Marcum’s communications with the Committee concerning independence and
the Committee discussed Marcum’s independence with Marcum.
On the
basis of these reviews and discussions, the Committee recommended to the Board
of Directors that the audited financial statements be included in the Company’s
General Form for Registration of Securities on Form 10, for filing with the
Securities and Exchange Commission.
Members
of the Audit Committee
A.
Jeffrey Radov
Joel San
Antonio
Meetings
Our Board
of Directors held five meetings during the fiscal year ended December 31,
2010.
The Audit
Committee of the Board of Directors did not meet during the fiscal year ended
December 31, 2010 since it was established in April 2011.
The
Nominating Committee of the Board of Directors did not meet during the fiscal
year ended December 31, 2010 since it was established in April
2011.
The
Compensation Committee of the Board of Directors did not meet during the fiscal
year ended December 31, 2010 since it was established in April
2011.
During
2010, Mr. Weinreb, our only incumbent director who served as such during such
year, attended all of the meetings of the Board that occurred during his term of
office.
We do not
have a formal policy regarding director attendance at our annual meeting of
shareholders. However, all directors are encouraged to attend.
Communications
with Board of Directors
Any
security holder who wishes to communicate with our Board of Directors or a
particular director should send the correspondence to the Board of Directors,
BioRestorative Therapies, Inc., 555 Heritage Drive, Suite 130, Jupiter, Florida
33458, Attention: Corporate Secretary. Any such communication so addressed will
be forwarded by the Corporate Secretary to the members or a particular member of
the Board.
Audit
Committee Financial Expert
Our Board
of Directors has determined that Mr. Radov is an “audit committee financial
expert,” as that is defined in Item 407(d)(5) of Regulation S-K. Mr. Radov is an
“independent director” based on the definition of independence in Listing Rule
5605(a)(2) of The Nasdaq Stock Market.
Section
16(a) Beneficial Ownership Reporting Compliance
Section
16 of the Exchange Act requires that reports of beneficial ownership of shares
of common stock and changes in such ownership be filed with the Securities and
Exchange Commission by Section 16 “reporting persons,” including directors,
certain officers, holders of more than 10% of the outstanding shares of common
stock and certain trusts of which reporting persons are trustees. We are
required to disclose in this proxy statement each reporting person whom we know
to have failed to file any required reports under Section 16 on a timely basis
during the fiscal year ended December 31, 2010. During such fiscal year, we were
not subject to the reporting requirements of Section 16.
Director
Independence
Board
of Directors
Our Board
of Directors is currently comprised of Mark Weinreb, A. Jeffrey Radov and Joel
San Antonio. Each of Messrs. Radov and San Antonio is currently an
“independent director” based on the definition of independence in Listing Rule
5605(a)(2) of The Nasdaq Stock Market.
Audit
Committee
The
members of our Board’s Audit Committee currently are Messrs. Radov and San
Antonio, each of whom is an “independent director” based on the definition of
independence in Listing Rule 5605(a)(2) of The Nasdaq Stock Market and Rule
10A-3(b)(1) under the Securities Exchange Act of 1934.
Nominating
Committee
The
members of our Board’s Nominating Committee currently are Messrs. Radov and San
Antonio, each of whom is an “independent director” based on the definition of
independence in Listing Rule 5605(a)(2) of The Nasdaq Stock Market.
Compensation
Committee
The
members of our Board’s Compensation Committee currently are Messrs. Radov and
San Antonio, each of whom is an “independent director” based on the definition
of independence in Listing Rule 5605(a)(2) of The Nasdaq Stock
Market.
Recommendation
The
Board of Directors recommends a vote FOR all nominees.
PROPOSAL
2: AMENDMENT TO ARTICLES OF INCORPORATION
TO
INCREASE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK
Our Board
of Directors has adopted resolutions approving and submitting to a vote of the
shareholders an amendment to Article II of our Articles of Incorporation
(“Articles”) to increase the number of authorized shares of common stock from
800,000,000 to 1,500,000,000.
Our Board
of Directors believes that the availability of additional authorized shares will
provide us with the flexibility in the future to issue shares of our common
stock for general corporate purposes, including raising additional capital,
settling outstanding obligations, and in connection with present and future
employee benefit programs, and acquisitions of companies or
assets.
Our Board
of Directors will determine whether, when and on what terms the issuance of our
shares of our common stock may be warranted in connection with any future
actions. No further action or authorization by our shareholders will be
necessary before the issuance of the additional shares of our common stock
authorized under our Articles, except as may be required for a particular
transaction by applicable law or regulatory agencies or by the rules of any
stock market or exchange on which our common stock may then be listed.
Our
Articles authorize the issuance of 800,000,000 shares of common stock, par value
$.001 per share, and 1,000,000 shares of preferred stock, par value $.01 per
share. As of December 16, 2011, there were 603,683,811 shares of
common stock issued and outstanding, and no shares of preferred stock
outstanding. In addition, as of such date, 26,150,000 shares of
common stock were issuable upon the exercise of outstanding options and
warrants.
Although
our Board has no current plans to utilize the additional authorized shares to
entrench present management, it may, in the future, be able to use the
additional common stock as a defensive tactic against hostile takeover
attempts. The authorization of such additional common stock will have
no current anti-takeover effect. No hostile take-over attempts are,
to our management’s knowledge, currently threatened. There are no
provisions in our Articles or By-Laws or other material agreements to which we
are a party that would, in our management’s judgment, have an anti-takeover
effect; however, as described under “Shareholder Proposals”, our By-Laws contain
certain advance notification requirements for nominations of persons for
election to our Board and proposals by shareholders at annual meeting of
shareholders.
The
relative rights and limitations of the common stock would remain unchanged under
the amendment. Our shareholders do not currently possess, nor upon
the approval of the proposed authorized share increase will they acquire,
preemptive rights, that would entitle such persons, as a matter of right, to
subscribe for the purchase of any shares, rights, warrants or other securities
or obligations convertible into, or exchangeable for, our
securities. Therefore, the proposed increase in authorized shares
could result in the dilution of the ownership interest of existing
shareholders.
Recommendation
The
Board of Directors recommends a vote FOR approval of the proposed amendment to
the Articles of Incorporation increase the number of authorized shares of common
stock from 800,000,000 to 1,500,000,000.
PROPOSAL
3: AMENDMENT TO OUR ARTICLES OF INCORPORATION TO EFFECT A REVERSE
STOCK SPLIT
Our Board
of Directors has approved and recommended a proposal to authorize the Board to
effect a reverse stock split of all of our outstanding common stock at a ratio
of not less than 1-for-10 and not more than 1-for-150, with our Board having the
discretion as to whether or not the reverse split is to be effected, and with
the exact ratio of any reverse split to be set at a whole number within the
above range as determined by our Board in its sole discretion. The
proposal provides that our Board will have sole discretion pursuant to Section
78.390(5) of the Nevada Revised Statutes to elect, at any time before the first
anniversary date of this meeting, as it determines to be in our best interest,
whether or not to effect the reverse split, and, if so, the number of our shares
of common stock between and including 1-for-10 and 1-for-150 which will be
combined into one share of our common stock. Our Board believes that
the availability of alternative reverse split ratios will provide it with the
flexibility to implement the reverse stock split in a manner designed to
maximize the anticipated benefits for us and our shareholders. In
determining whether to implement the reverse split following the receipt of
shareholder approval, our Board of Directors may consider, among other things,
factors such as:
|
-
|
the
historical trading price and trading volume of our common
stock;
|
|
-
|
the
then prevailing trading price and trading volume of our common stock and
the anticipated impact of the reverse split on the trading market for our
common stock;
|
|
-
|
our
ability to have our shares of common stock listed on a stock exchange such
as The Nasdaq Stock Market;
|
|
-
|
the
anticipated impact of the reverse split on our ability to raise additional
financing;
|
|
-
|
which
alternative split ratio would result in the greatest overall reduction in
our administrative costs; and
|
|
-
|
prevailing
general market and economic
conditions.
|
If our
Board determines that effecting the reverse split is in our best interest, the
reverse split will become effective upon filing of an amendment to our Articles
of Incorporation with the Secretary of State of the State of
Nevada. The amendment filed thereby will set forth the number of
shares to be combined into one share of our common stock within the limits set
forth in this proposal. Except for adjustments that may result from the
treatment of fractional shares as described below, each shareholder will hold
the same percentage of our outstanding common stock immediately following the
reverse split as such shareholder holds immediately prior to the reverse
split.
Reasons
for the Reverse Stock Split
The Board
believes that a reverse stock split is desirable for a two
reasons. First, the Board believes that a reverse stock split could
improve the marketability and liquidity of our common stock. Second, the Board
believes that a reverse stock split may facilitate the listing of our common
stock on a stock exchange such as The Nasdaq Stock Market.
Marketability
Our Board
of Directors believes that the increased market price of our common stock
expected as a result of implementing a reverse split could improve the
marketability and liquidity of our stock and will encourage interest and trading
in our stock. Theoretically, the number of shares outstanding and the
per share price should not, by themselves, affect the marketability of our
common stock, the type of investor who acquires them, or our reputation in the
financial community. However, in practice, this is not necessarily
the case, as many investors look upon low-priced stocks as unduly speculative in
nature and, as a matter of policy, avoid investment in such
securities. Our Board is aware of the reluctance of many leading
brokerage firms to recommend low-priced stocks to their
clients. Further, a variety of brokerage house policies and practices
tend to discourage individual brokers within those firms from dealing in
low-priced stocks. Institutional investors typically are restricted
from investing in companies whose stocks trade at less than five dollars per
share. Stockbrokers are also subject to restrictions on their ability
to recommend stocks trading at less than five dollars per share because of the
general presumption that such securities may be highly
speculative. In addition, the structure of trading commissions tends
to have an adverse impact upon holders of low-priced stocks because the
brokerage commission on a sale of such securities generally represents a higher
percentage of the sales price than the commission on a relatively higher-priced
issue.
The
reverse split is intended, in part, to result in a price level for our common
stock that will increase investor interest and eliminate the resistance of
brokerage firms. On December 9, 2011, the closing bid price for our common
stock, as reported by the OTCQB Market, was $.016 per share. No
assurances can be given that the market price for our common stock will increase
in the same proportion as the reverse split or,
if increased, that such price will be
maintained. In addition, no assurances can be given that the reverse
split will increase the price of our common stock to a level in excess of the
five dollar threshold discussed above or otherwise to a level that is attractive
to brokerage houses and institutional investors.
Stock
Exchange Requirements
Our
common stock is currently traded on the OTCQB Market. Such trading
market is considered to be less efficient than that provided by a stock exchange
such as The Nasdaq Stock Market. Our Board of Directors is currently
considering whether to seek to have our common stock listed on a stock exchange
such as The Nasdaq Stock Market. In order for us to list our common
stock on The Nasdaq Stock Market, we must fulfill certain listing
requirements. Set forth below are certain salient minimum
quantitative listing requirements that we must meet, together with a comparison
of how we currently stand with regard to the requirements.
|
Category
|
Nasdaq
Requirement
|
BioRestorative
Therapies, Inc.
|
|
Stockholders’
equity (deficiency)
|
$5,000,000
|
($3,343,969)
(as
of September 30, 2011)
|
|
Minimum
bid price
|
$4
|
$.013
(as
of December 9, 2011)
|
|
Publicly-held
shares (1)
|
1,000,000
|
447,563,429
(as
of December 9, 2011)
|
|
Market
value of publicly-held shares (1)
|
$15,000,000
|
$7,161,015
(as
of December 9, 2011)
|
|
Shareholders
(round lot holders) (2)
|
300
|
156
(as
of December 9, 2011)
|
_______________
|
(1)
|
“Publicly-held
shares” is defined as total shares outstanding less any shares held by
officers, directors and beneficial owners of 10% or more of our
outstanding shares.
|
|
(2)
|
Round
lot holders are holders of 100 shares or
more.
|
The
Nasdaq Stock Market also requires that an applicant have at least three market
makers and comply with certain corporate governance requirements, including
having at least two Audit Committee members (a majority of whom must be
independent) and that a majority of our Board members be
independent. Currently, we satisfy the Audit Committee and Board
requirements.
No
assurance can be given that, even if we satisfy the above listing requirements,
we will apply to have our common stock listed on The Nasdaq Stock Market, or
that, if we do so apply, that our application will be approved, or that, if our
common stock is listed on The Nasdaq Stock Market, we will be able to satisfy
the maintenance requirements for continued listing.
Effects
of the Reverse Split
If the
reverse stock split is approved and implemented, the principal effect will be to
proportionately decrease the number of outstanding shares of our common stock
based on the reverse stock split ratio selected by our Board of Directors. We
have registered our common stock under Section 12(g) of the Securities Exchange
Act of 1934 (the “Exchange Act”), and we are subject to the periodic reporting
and other requirements of the Exchange Act. Our shares of common
stock currently trade on the OTCQB Market. The reverse stock split
will not affect the registration of our common stock under the Exchange Act or
the listing of our common stock on the OTCQB Market. Following the reverse stock
split, our common stock will continue to be listed on the OTCQB Market under the
symbol "BRTX," although it will be considered a new listing with a new CUSIP
number.
Proportionate
voting rights and other rights and preferences of the holders of our common
stock will not be affected by the proposed reverse stock split (other than as a
result of the payment of cash in lieu of fractional shares). For
example, a holder of 2% of the voting power of the outstanding shares of our
common stock immediately prior to the effectiveness of the reverse stock split
will generally continue to hold 2% of the voting power of the outstanding shares
of our common stock immediately after the reverse stock
split. Moreover, the number of shareholders of record will not be
affected by the reverse stock split (except to the extent any shareholders are
cashed out as a result of holding fractional shares).
Board
Discretion to Implement or Abandon Reverse Split
The
reverse split will be effected, if at all, only upon a determination by our
Board that the reverse split (with an exchange ratio determined by our Board as
described above) is in our best interest. Such determination shall be based upon
certain factors, including, but not limited to, our ability to meet stock
exchange listing requirements, existing and expected marketability and liquidity
of our common stock and the expense of effecting the reverse split.
Notwithstanding approval of the reverse split by our shareholders, our Board
may, in its sole discretion, abandon the proposal and determine, prior to the
effectiveness of any filing with the Secretary of State of the State of Nevada,
not to effect the reverse split. If our Board fails to implement the
reverse split on or prior to the one year anniversary of this meeting,
shareholder approval again would be required prior to implementing any reverse
stock split.
Reduction
in Authorized Common Stock
Shareholder
approval of this proposal shall constitute authorization for us to reduce the
number of our authorized shares of common stock as provided for
below. The Board may reduce the number of our authorized shares to a
number which results in a ratio of authorized shares of common stock to issued
and outstanding shares of common stock that most closely approximates the ratio
of our authorized common stock to issued and outstanding common stock
immediately prior to the reverse split. Accordingly, assuming that our Board
determines to implement a 1-for-10 reverse split, our Board would have the
authority to reduce our authorized common stock in the same proportion. This
would result in our authorized common stock being reduced from 1,500,000,000
(assuming that Proposal 2 is approved) to 150,000,000. However, our Board will
have the sole discretion to determine whether or not to implement such a
reduction in authorized common stock in connection with the reverse split.
Alternatively, our Board will have the sole discretion to implement a reduction
in authorized common stock to a lesser degree such that, following the reverse
split, the ratio of authorized common stock to issued and outstanding common
stock would be higher than that in effect prior to the reverse split. Therefore,
in the event that our Board determines to implement a reverse split but not to
implement a proportionate reduction in authorized common stock, we would, in
effect, have authority to issue a greater number of shares of common stock than
prior to the reverse split. There are no written or oral plans, arrangements or
understandings with respect to the issuance of any such additional common
stock.
Effective
Date
If
implemented by our Board, the reverse split would become effective upon the
filing of an amendment to our Articles of Incorporation with the Secretary of
State of the State of Nevada. Except as explained below with respect
to fractional shares, on the effective date, shares of common stock issued and
outstanding immediately prior thereto will be combined and converted,
automatically and without any action on the part of the shareholders, into new
shares of common stock in accordance with reverse split ratio determined by the
Board within the limits set forth in this proposal.
Fractional
Shares
No
fractional shares of common stock will be issued as a result of the reverse
split. Instead, shareholders who otherwise would be entitled to receive
fractional shares will be entitled to receive cash in an amount equal to the
product obtained by multiplying (i) the closing price of our shares of common
stock on the day immediately preceding the effective date of the reverse split,
as reported on the OTCQB Market (or, if the closing price of our common stock is
not then reported on the OTCQB Market, then the fair market value of our shares
of common stock as determined by the Board) by (ii) the number of shares of our
common stock held by such shareholder that would otherwise have been exchanged
for such fractional share interest.
Other
Effect
If
approved, the reverse split will result in some shareholders owning "odd-lots"
of fewer than 100 shares of common stock. Brokerage commissions and other costs
of transactions in odd-lots are generally somewhat higher than the costs of
transactions in "round-lots" of even multiples of 100 shares.
Exchange
of Stock Certificates
As soon
as practicable after the effective date, shareholders will be notified that the
reverse split has been effected. Our transfer agent will act as
exchange agent for purposes of implementing the exchange of stock
certificates. We refer to such person as the “exchange
agent.” Holders of pre-reverse split shares (“Old Shares”) will be
asked to surrender to the exchange agent certificates representing pre-reverse
split shares in exchange for certificates representing post-reverse split shares
(“New Shares”) in accordance with the procedures to be set forth in a letter of
transmittal to be sent by us. No new certificates will be
issued to a shareholder until such shareholder has surrendered such
shareholder’s outstanding certificate(s) together with the properly completed
and executed letter of transmittal to the exchange agent. Shareholders should not destroy any
stock certificate and should not submit any certificates until requested to do
so.
No
Appraisal Rights
Under the
Nevada Revised Statutes, our shareholders are not entitled to appraisal rights
with respect to the proposed amendment to our Articles of Incorporation to
effect the reverse split.
Tax
Consequences
The
proposed reverse split is being presented for approval based upon the
expectation that, among other things, no gain or loss will be recognized by the
holders of our common stock (except to the extent of cash, if any, received in
lieu of fractional shares) or by BioRestorative Therapies, Inc. A
holder who receives cash will generally recognize gain or loss equal to the
difference between the portion of the tax basis of the Old Shares allocated to
the fractional share interest and the cash received.
Each
shareholder will have a basis in the New Shares equal to the basis of the Old
Shares (except to the extent the basis is allocated to fractional
shares). For purposes of determining whether gain or loss on a
subsequent disposition is long-term or short-term, the holding period of the New
Shares will include the period during which the corresponding Old Shares were
held, provided such corresponding Old Shares were held as a capital asset on the
date of filing of the amendment to our Articles of Incorporation.
No ruling
has been requested from the Internal Revenue Service with respect to the
foregoing tax matters. Shareholders should consult their own
tax advisors as to the effect of the reverse split under applicable tax
laws.
Recommendation
The
Board of Directors recommends a vote FOR the approval of the proposal to
authorize our Board to effect the reverse split.
INDEPENDENT
PUBLIC ACCOUNTANTS
In
February 2011, we engaged Marcum LLP as our independent registered public
accountants to audit our financial statements as of December 31, 2010 and 2009,
for the years then ended and for the period from December 30, 2008 (inception)
to December 31, 2010; prior to that date, we did not have independent
auditors. Marcum LLP has been selected as our independent registered
public accountants for the year ending December 31, 2011. It is not expected
that representatives of Marcum LLP will attend the meeting.
The
following is a summary of the fees billed to us by Marcum LLP, our independent
registered public accountants, for professional services rendered with respect
to the fiscal years ended December 31, 2010 and 2009:
|
Fee
Category
|
|
Fiscal
2010 Fees
|
|
|
Fiscal
2009 Fees
|
|
|
Audit
Fees(1)
|
|
$ |
100,845 |
|
|
$ |
45,564 |
|
|
Audit-Related
Fees(2)
|
|
|
- |
|
|
|
- |
|
|
Tax
Fees(3)
|
|
$ |
8,595 |
|
|
|
- |
|
|
All
Other Fees(4)
|
|
|
- |
|
|
|
- |
|
_________
|
(1)
|
Audit
Fees consist of fees billed for services rendered for the audit of our
consolidated financial statements for the fiscal years ended December 31,
2010 and 2009.
|
|
(2)
|
Audit-Related
Fees consist of fees billed for assurance and related services that are
reasonably related to the performance of the audit of our financial
statements and are not reported under “Audit
Fees.”
|
|
(3)
|
Tax
Fees consist of fees billed for professional services related to
preparation of our U.S. federal and state income tax returns and tax
advice.
|
|
(4)
|
All
Other Fees consist of fees billed for products and services provided by
our independent registered public accountants, other than those disclosed
above.
|
The Audit
Committee is responsible for the appointment, compensation and oversight of the
work of the independent registered public accountants, and approves in advance
any services to be performed by the independent registered public accountants,
whether audit-related or not. The Audit Committee reviews each proposed
engagement to determine whether the provision of services is compatible with
maintaining the independence of the independent registered public accountants.
Substantially all of the fees shown above were pre-approved by our Board as the
Audit Committee was not established until April 2011.
SHAREHOLDER
PROPOSALS
Shareholder
proposals intended to be presented at our next annual meeting of shareholders
pursuant to the provisions of Rule 14a-8 of the Securities and Exchange
Commission, promulgated under the Securities Exchange Act of 1934, as amended,
must be received at our offices in Jupiter, Florida by ____________, 2012 for
inclusion in our proxy statement and form of proxy relating to such
meeting. We intend, however, to hold our next annual meeting earlier
next year than we did this year. Accordingly, we suggest that
shareholder proposals intended to be presented at the next annual meeting be
submitted well in advance of June 15, 2012, the earliest date upon which we
anticipate the proxy statement and form of proxy relating to such meeting will
be made available to shareholders.
The
following requirements with respect to shareholder proposals and shareholder
nominees to our Board of Directors are included in our By-Laws.
Shareholder
Proposals
In order
for a shareholder to make a proposal at an annual meeting of shareholders, under
our By-Laws, timely notice must be received by us in advance of the
meeting. To be timely, a shareholder's notice must be delivered to or
mailed and received by our Secretary at our principal executive offices not less
than 60 days prior to the scheduled date of the meeting (regardless of any
postponements, deferrals or adjournments of the meeting to a later date);
provided, however, if no notice is given and no public announcement is made to
the shareholders regarding the date of the meeting at least 75 days prior to the
meeting, the shareholder's notice shall be valid if delivered to or mailed and
received by our Secretary at our principal executive offices not less than 15
days following the day on which the notice or public announcement of the date of
the meeting was given or made.
A
shareholder’s notice must set forth as to each matter the shareholder proposes
to bring before the annual meeting certain information regarding the proposal,
including the following:
|
·
|
a
brief description of the business desired to be brought before the
meeting, the reasons for conducting such business at the meeting and, in
the event that such business includes a proposal to amend either our
Articles of Incorporation or By-Laws, the language of the proposed
amendment;
|
|
·
|
the
name and address, as they appear on our books, of the shareholder
proposing such business;
|
|
·
|
the
class and number of shares of our capital stock that are beneficially
owned by such shareholder; and
|
|
·
|
any
material interest (financial or other) of such shareholder in such
business.
|
Shareholder
Nominees
In order
for a shareholder to nominate a candidate for director, under our By-Laws,
timely notice of the nomination must be received by us in advance of the
meeting. To be timely, a shareholder's notice must be delivered
to or mailed and received by our Secretary at our principal executive offices
not less than 60 days prior to the scheduled date of the meeting (regardless of
any postponements, deferrals or adjournments of the meeting to a later date);
provided, however, if no notice is given and no public announcement is made to
the shareholders regarding the date of the meeting at least 75 days prior to the
meeting, the shareholder's notice shall be valid if delivered to or mailed and
received by our Secretary at our principal executive offices not less than 15
days following the day on which the notice or public announcement of the date of
the meeting was given or made
The
shareholder sending the notice of nomination must describe various matters,
including the following:
|
·
|
the
name, age, business and residential addresses, and occupation or
employment of the nominee;
|
|
·
|
the
number of shares of our capital stock beneficially owned by the
nominee;
|
|
·
|
the
written consent by the nominee, agreeing to serve as a director if
elected;
|
|
·
|
a
description of all arrangements or understandings between the nominee and
any other person or persons (naming such persons) regarding the
nomination;
|
|
·
|
any
other information relating to such nominee required to be disclosed in a
proxy statement;
|
|
·
|
such
other information as we may reasonably request to determine the
eligibility of the proposed nominee to serve as one of our
directors;
|
|
·
|
the
name, business address and residential address of the
shareholder;
|
|
·
|
the
number of shares of our capital stock beneficially owned by the
shareholder;
|
|
·
|
a
description of all arrangements or understandings between the shareholder
and the nominee regarding the nomination;
and
|
|
·
|
a
description of all arrangements or understandings between the shareholder
and any other person or persons (naming such persons) regarding the
nomination.
|
These
requirements are separate from and in addition to the requirements a shareholder
must meet to have a proposal included in our proxy statement.
Any
notice given pursuant to the foregoing requirements must be sent to our
Secretary at 555 Heritage Drive, Suite 130, Jupiter, Florida
33458. The foregoing
is only a summary of the provisions of our By-Laws that relate to shareholder
proposals and shareholder nominations for director. Any shareholder
desiring a copy of our By-Laws will be furnished one without charge upon receipt
of a written request therefor.
OTHER
BUSINESS
While the
accompanying Notice of Annual Meeting of Shareholders provides for the
transaction of such other business as may properly come before the meeting, we
have no knowledge of any matters to be presented at the meeting other than those
listed as Proposals 1, 2 and 3 in the notice. However, the enclosed
proxy gives discretionary authority in the event that any other matters should
be presented.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
This
proxy statement is accompanied by a copy of our General Form for Registration of
Securities on Form 10, as amended (the “Form 10”), and our Quarterly Report on
Form 10-Q for the period ended September 30, 2011 (the "September 2011 Form
10-Q").
The
following information from our Form 10 with respect to the fiscal years ended
December 31, 2010 and 2009 and for the period from December 30, 2008 (inception)
to December 31, 2010, as filed with the SEC pursuant to Section 13 or 15(d) of
the Exchange Act, is hereby incorporated by
reference into this proxy statement:
|
·
|
“Management’s
Discussion and Analysis of Financial Condition and Results of Operations,”
included in Item 2 thereof;
|
|
·
|
our
consolidated financial statements as of December 31, 2010 and 2009, for
the years then ended and for the period from December 30, 2008 (inception)
to December 31, 2010, included in Item 13 thereof (found following Item 15
thereof);
|
|
·
|
“Changes
in and Disagreements with Accountants on Accounting and Financial
Disclosure,” included in Item 14
thereof.
|
The
following information from our September 2011 Form 10-Q, as filed with the
SEC pursuant to Section 13 or 15(d) of the Exchange Act, is hereby
incorporated by reference into this proxy statement:
|
·
|
our
consolidated financial statements as of September 30, 2011 and
for the three and nine months ended September 30, 2011 and 2010, included
in Part I, Item 1 thereof; and
|
|
·
|
“Management’s
Discussion and Analysis of Financial Condition and Results of Operations,”
included in Part I, Item 2 thereof.
|
Any statement contained in
a document incorporated herein by reference shall
be deemed to
be modified or superseded for purposes of
this proxy statement to the extent that a statement contained herein
modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed,
except as
so modified or superseded, to constitute a
part of this proxy statement.
Mark
Weinreb
Chief
Executive Officer
Jupiter,
Florida
December
__, 2011
|
BioRestorative Therapies,
Inc.
555
Heritage Drive
Jupiter,
Florida 33458
|
VOTE
BY INTERNET - www.proxyvote.com
Use
the Internet to transmit your voting instructions and for electronic
delivery of information up until 11:59 P.M. Eastern Time the day before
the cut-off date or meeting date. Have your proxy card in hand
when you access the web site and follow the instructions to obtain your
records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE
PROXY MATERIALS
If
you would like to reduce the costs incurred by our company in mailing
proxy materials, you can consent to receiving all future proxy statements,
proxy cards and annual reports electronically via e-mail or the Internet.
To sign up for electronic delivery, please follow the instructions above
to vote using the Internet and, when prompted, indicate that you agree to
receive or access proxy materials electronically in future
years.
VOTE
BY PHONE – 1-800-690-6903
Use
any touch-tone telephone to transmit your voting instructions up until
11:59 P.M. Eastern Time the day before the cut-off date or meeting date.
Have your proxy card in hand when you call and then follow the
instructions.
VOTE
BY MAIL
Mark,
sign and date your proxy card and return it in the postage-paid envelope
we have provided or return it to Vote
Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY
11717.
|
TO VOTE,
MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
M37471-P15157 KEEP
THIS PORTION FOR YOUR RECORDS
THIS PROXY CARD IS VALID
ONLY WHEN SIGNED AND DATED. DETACH AND RETURN THIS
PORTION ONLY
|
BIORESTORATIVE
THERAPIES, INC.
1. Election
of Directors.
Nominees:
01) Mark
Weinreb
02) A.
Jeffrey Radov
03) Joel
San Antonio
|
For
All
0
|
Withhold
All
0
|
For
All
Except
0
|
To
withhold authority to
vote for any
individual
Nominee(s), mark “For All Except”
and
write the number(s) on the line below.
______________________________________
|
|
|
|
|
|
|
2.
Proposal to approve an amendment to the Company’s Articles of
Incorporation to increase the number of shares of common stock authorized
to be issued from 800,000,000 to 1,500,000,000.
|
For
0
|
Against
0
|
Abstain
0
|
|
|
|
|
|
|
3.
Proposal to authorize our Board of Directors to effect a reverse
split of our common stock by a ratio of not less than 1-for-10 and not
more than 1-for-150, with our Board having the discretion as to whether or
not the reverse split is to be effected, and with the exact ratio of any
reverse split to be set at a whole number within the above range to be
determined by our Board in its discretion.
|
For
0
|
Against
0
|
Abstain
0
|
|
|
|
|
|
|
4.
In his discretion, the proxy is authorized to vote upon such other
business as may property come
before
the meeting.
|
|
|
|
|
The
Board of Directors recommends a vote FOR all of the named nominees and FOR
Proposals 2 and 3.
THIS
PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION
IS GIVEN, WILL BE VOTED FOR THE ELECTION OF THE NOMINEES AND FOR PROPOSALS
2 AND 3. THE PROXYHOLDER WILL HAVE DISCRETIONARY AUTHORITY TO
VOTE ON ANY OTHER MATTER THAT PROPERLY COMES BEFORE THE
MEETING.
|
|
|
|
|
|
|
|
Signature
[Please Sign Within Box]
|
Date
|
|
Signature
(Joint Owners)
|
Date
|
ANNUAL
MEETING OF SHAREHOLDERS OF
BIORESTORATIVE
THERAPIES, INC.
FEBRUARY
10, 2012
Please
date, sign and mail
your
proxy card in the
envelope
provided
as
soon as possible.
Important
Notice Regarding the Availability of Proxy Materials for the Annual
Meeting:
The
Notice and Proxy Statement, Form 10 and Form 10-Q for the period
ended
September
30, 2011 are available at www.proxyvote.com.
Please
detach along perforated line and mail in the envelope provided.
-----------------------------------------------------------------------------------------------------------------------------------------------
BIORESTORATIVE
THERAPIES, INC.
This
Proxy is Solicited on Behalf of the Board of Directors
The
undersigned hereby appoints Mark Weinreb as proxy, with the power to appoint his
substitute, and hereby authorizes him to represent and vote, as designated on
the reverse side, all the shares of common stock of BioRestorative Therapies,
Inc. held of record by the undersigned at the close of business on December 16,
2011 at the Annual Meeting of Shareholders to be held on February 10, 2012 or
any adjournment thereof.
IF
YOU VOTE BY TELEPHONE OR BY INTERNET, DO NOT MAIL THE PROXY
CARD. YOUR TELEPHONE OR INTERNET VOTE AUTHORIZES THE NAMED PROXY TO VOTE IN THE
SAME MANNER AS YOU VOTED YOUR PROXY CARD. THE TELEPHONE AND INTERNET VOTING
FACILITIES WILL CLOSE AT 11:59 P.M. ON ______________.
(Continued
and to be signed on the reverse side)