SCHEDULE
14A
(Rule
14a-101)
Proxy
Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by
the Registrant x
Filed by
a Party other than the Registrant o
Check the
appropriate box:
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o
Preliminary Proxy Statement
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o
Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
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x
Definitive Proxy Statement
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o
Definitive Additional Materials
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Soliciting Material Pursuant to Rule 14a-11(c) or Rule
14a-12
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IR
BIOSCIENCES HOLDINGS, INC.
(Name
Of Registrant As Specified In Its Charter)
(Name
Of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment
of Filing Fee (Check appropriate box):
x No fee
required.
o 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:
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N/A
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(2)
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Aggregate
number of securities to which transaction
applies:
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N/A
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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 filing fee is
calculated and state how it was
determined):
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(4)
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Proposed
maximum aggregate value of
transaction:
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N/A
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(5)
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Total
fee paid:
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N/A
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o
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Fee
paid previously with preliminary materials:
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o
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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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Amount
Previously Paid:
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_________________________
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| (2) | Form, Schedule or Registration Statement no.: |
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Filing
Party:
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_________________________
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Date
Filed:
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| _________________________ |
IR
BIOSCIENCES HOLDINGS, INC.
NOTICE
OF ANNUAL MEETING OF STOCKHOLDERS
To the
Stockholders of IR BioSciences Holdings, Inc.:
You are
cordially invited to attend the 2008 Annual Meeting of Stockholders (the “Annual
Meeting”) of IR BioSciences Holdings, Inc, a Delaware corporation (“we,” “us,”
“our,” or the “Company”), to be held at the Villagio Inn, located at The Vintage
Estates, 6841 Washington Street, Yountville, California, 94599, on June 25, 2008
at 9:00 a.m., Pacific Daylight Time.
The Annual Meeting of the Company is
being held for the following purposes:
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1.
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To
elect six directors to serve on the Board of Directors until the 2009
Annual Meeting of Stockholders;
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2.
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To
approve an amendment to our Certificate of Incorporation, as amended,
to increase the number of authorized shares of Common Stock from
250,000,000 to 450,000,000;
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3.
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In
the event that number 2 above is approved, to approve an amendment to
our 2003 Stock Option, Deferred Stock and Restricted Stock Plan (the
"Plan") to increase the number of shares of our Common Stock reserved
and available for issuance under the Plan from 20,000,000 to
60,000,000;
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4.
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To
approve an amendment to the IR BioSciences Holdings, Inc.’s Certification
of Incorporation, as amended, (i) to provide for a recapitalization in
which the issued and outstanding shares of our Common Stock will be
reverse split in a ratio of one-for-ten at any time prior to March 31,
2009, if at all, with the timing thereof to be determined by the Board of
Directors in its sole discretion and (ii) to reduce the number of
authorized shares of Common Stock to 100,000,000.;
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| 5. | To ratify the appointment of RBSM LLP as the Company’s independent public accountants for the fiscal year ending December 31, 2008; and, |
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6.
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To
transact such other business as may properly come before the
meeting.
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The
Board of Directors recommends a vote “for” each of the nominees and” for” each
proposal listed above.
The Board
of Directors has fixed the close of business on April 28, 2008 as the record
date (the “Record Date”) for determining those stockholders who will be entitled
to vote at the Annual Meeting.
The
Company’s Annual Report to Stockholders for the year ended December 31, 2007 is
enclosed with this notice. The following proxy statement and enclosed proxy card
is being sent to each stockholder as of the Record Date. You are cordially
invited to attend the Annual Meeting, but if you do not expect to attend, or if
you plan to attend, but desire the proxy holders to vote your shares, please
date and sign your proxy card and return it in the enclosed postage paid
envelope. The giving of this proxy card will not affect your right to vote in
person in the event you find it convenient to attend. Please return the proxy
card promptly to avoid the expense of additional proxy
solicitation.
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By
Order of the Board of Directors,
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/s/
Michael K.
Wilhelm
Michael
K. Wilhelm
President
and Chief Executive Officer
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Scottsdale,
Arizona
Dated: May
9, 2008
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To
be mailed to Stockholders on or about May 13,
2008.
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WHETHER
OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, YOU ARE REQUESTED TO COMPLETE,
SIGN, DATE AND MAIL THE ENCLOSED PROXY, WHICH IS SOLICITED BY AND ON BEHALF OF
THE BOARD OF DIRECTORS, SO THAT YOUR SHARES MAY BE REPRESENTED AT THE MEETING. A
POSTAGE-PAID ENVELOPE IS PROVIDED FOR MAILING IN THE UNITED STATES. THE GIVING
OF SUCH PROXY WILL NOT AFFECT YOUR RIGHTS TO REVOKE SUCH PROXY OR TO VOTE IN
PERSON SHOULD YOU LATER DECIDE TO ATTEND THIS MEETING.
TABLE OF CONTENTS
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IR BIOSCIENCES HOLDINGS, INC.
PROXY
STATEMENT
For
Annual Meeting to be Held
June
25, 2008 at 9:00 a.m. Pacific Daylight Time
This
proxy statement is delivered to you by IR BioSciences Holdings, Inc. (“we,”
“us,” “our,” or the “Company”), a Delaware corporation, in connection with the
Annual Meeting of Stockholders of the Company to be held on June 25, 2008 at
9:00 a.m. Pacific Daylight Time at the Villagio Inn, located at The Vintage
Estates, 6841 Washington Street, Yountville, California, 94599 (the “Annual
Meeting”). The approximate mailing date for this proxy statement and the
enclosed proxy is May 13, 2008.
The
purpose of the Annual Meeting is to seek stockholder approval of five proposals:
(i) electing six directors to the Board of Directors; (ii) to approve an
amendment to our Certificate of Incorporation, as amended, to increase the
number of authorized shares of Common Stock from 250,000,000 to 450,000,000;
(iii) to approve an amendment to our 2003 Stock Option, Deferred Stock and
Restricted Stock Plan (the "Plan") to increase the number of shares of our
Common Stock reserved and available for issuance under the Plan from 20,000,000
to 60,000,000; (iv) to approve an amendment to the Company’s Certificate of
Incorporation, as amended, providing for a recapitalization in which the issued
and outstanding shares of our Common Stock will be reverse split in a ratio of
one-for-ten at any time prior to March 31, 2009, if at all, with the timing
thereof to be determined by the Board of Directors in its sole discretion, and
to decrease the number of authorized shares of Common Stock to 100,000,000; and,
(v) to ratify the appointment of RBSM LLP, as the Company’s independent
registered public accounting firm for the year ending December 31,
2008.
Holders
of common stock of record at the close of business on the Record Date will be
entitled to vote at the Annual Meeting. There were 116,017,539 shares of common
stock outstanding as of the Record Date. Only Stockholders of record at the
close of business on the record date, April 28, 2008, are entitled to receive
notice of the annual meeting and to vote the shares that they held on that date
at the meeting, or any postponement or adjournment of the meeting. Each
outstanding share of Common Stock entitles its holder to cast one vote on each
matter to be voted.
Who can attend the meeting?
All
Stockholders as of the record date, or their duly appointed proxies, may attend
the meeting. Please note that if you hold shares in "street name," that is
through a broker or other nominee, you will need to bring a copy of the
brokerage statement reflecting your stock ownership as of the record
date.
What constitutes a quorum?
The
presence at the meeting, in person or by proxy, of the holders of a majority of
the outstanding shares of our Common Stock on the record date will constitute a
quorum. As of the record date, there were 116,017,539 shares of our Common Stock
issued and outstanding.
If you
hold shares beneficially in street name and do not provide your broker with
voting instructions, your shares may constitute “broker non-votes.” Generally,
broker non-votes occur on a matter when a broker is not permitted to vote on
that matter without instructions from the beneficial owner and instructions are
not given. In tabulating the voting result for any particular proposal, shares
that constitute broker non-votes are not considered entitled to vote on that
proposal. Thus, broker non-votes will not affect the outcome of any matter being
voted on at the meeting, assuming that a quorum is obtained. However, shares
represented by such “broker non-votes” will be counted in determining whether
there is a quorum. A properly executed proxy marked “Abstain” with respect to
any such matter will not be voted, although it will be counted for purposes of
determining whether there is a quorum.
If less
than a majority of the outstanding shares of Common Stock entitled to vote are
represented at the meeting, a majority of the votes present (either in person or
by proxy) at the meeting may adjourn the meeting to another date, time or place,
and notice need not be given of the new date, time or place if the new date,
time or place is announced at the meeting before an adjournment is
taken.
How do I vote?
Registered
Shareholders
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If
you complete and properly sign the accompanying proxy card, and return it
to us, it will be voted as you direct. If no direction is given, the
shares represented by the proxy will be voted (i) for the election of the
nominees for director named herein; (ii) for approving an amendment
to our Certificate of Incorporation, as amended, to increase the number of
authorized shares of Common Stock from 250,000,000 to 450,000,000; (iii)
in the event that (ii) above is approved, for approving an amendment to
our 2003 Stock Option, Deferred Stock and Restricted Stock Plan (the
"Plan") to increase the number of shares of our Common Stock reserved and
available for issuance under the Plan from 20,000,000 to 60,000,000; (iv)
for approving an amendment to the Company’s Certificate of Incorporation,
as amended, providing for a recapitalization in which the issued and
outstanding shares of our Common Stock will be reverse split in a ratio of
one-for-ten at any time prior to March 31, 2009, if at all, with the
timing thereof to be determined by the Board of Directors in its sole
discretion, and decreasing the number of authorized shares of Common Stock
to 100,000,000; and, (v) for ratifying the appointment of RBSM LLP, as the
Company’s independent registered public accounting firm for the year
ending December 31, 2008.
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If
you wish to vote at the meeting, you may deliver your completed proxy card
in person or you may vote by ballot in person at the annual
meeting.
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"Street
Name" Shareholders
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If
you complete and properly sign the accompanying proxy card, and return it
to us, it will be voted as you direct. If no direction is given, the
shares represented by the proxy will be voted (i) for the election of the
nominees for director named herein; (ii) for approving an amendment
to our Certificate of Incorporation, as amended, to increase the number of
authorized shares of Common Stock from 250,000,000 to 450,000,000; (iii)
in the event that (ii) above is approved, for an amendment to our 2003
Stock Option, Deferred Stock and Restricted Stock Plan (the "Plan") to
increase the number of shares of our Common Stock reserved and available
for issuance under the Plan from 20,000,000 to 60,000,000; (iv) for
approving an amendment to the Company’s Certificate of Incorporation, as
amended, providing for a recapitalization in which the issued and
outstanding shares of our Common Stock will be reverse split in a ratio of
one-for-ten at any time prior to March 31, 2009, if at all, with the
timing thereof to be determined by the Board of Directors in its sole
discretion, and decreasing the number of authorized shares of Common Stock
to 100,000,000; and, (v) for ratifying the appointment of RBSM LLP, as the
Company’s independent registered public accounting firm for the year
ending December 31, 2008.
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If
you wish to vote at the meeting, you will need to obtain a proxy from the
institution that holds your shares.
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Can I change my vote after I return my proxy card?
Yes. Any
proxy given may be revoked at any time prior to its exercise by notifying the
Corporate Secretary of the Company in writing of such revocation, by duly
executing and delivering another proxy bearing a later date, or by attending and
voting in person at the Annual Meeting. The powers of the proxy holders will be
suspended with respect to your shares if you attend the meeting in person and so
request, although attendance at the meeting will not by itself revoke a
previously granted proxy. The Company’s principal executive office is located at
8767 E. Via De Ventura, Suite 190, Scottsdale, Arizona 85258.
What are the Board's recommendations?
Unless
you give other instructions on your proxy card, the persons named as proxy
holders on the proxy card will vote in accordance with the recommendations of
the Board of Directors. The Board's recommendations are provided together with a
description of each proposal in this proxy statement. In summary, the Board
recommends a vote:
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for election of the
nominated slate of directors (see page
5);
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for
approving an amendment to our Certificate of Incorporation, as amended, to
increase the number of authorized shares of Common Stock from 250,000,000
to 450,000,000 (see page 22);
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for
an amendment to our 2003 Stock Option, Deferred Stock and Restricted Stock
Plan (the "Plan") to increase the number of shares of our Common Stock
reserved and available for issuance under the Plan from 20,000,000 to
60,000,000 (see page 24);
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for
approval of the amendment to our Certificate of Incorporation, as amended,
to provide for a recapitalization in which the issued and outstanding
shares of our Common Stock will be reverse split in a ratio of one-for-ten
at any time prior to March 31, 2009, if at all, with the timing thereof to
be determined by the Board of Directors in its sole discretion, and to
decrease the number of authorized shares of Common Stock to 100,000,000
(see page 26); and,
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for
ratifying the appointment of RBSM LLP as our independent public
accountants for the year ending December 31, 2008 (see page
33).
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What
vote is required to approve each item?
Election of
Directors. The nominees for election to the Board of Directors, who
receive the greatest number of votes cast for the election of directors by the
shares present at the annual meeting, in person or by proxy, shall be elected
directors. Stockholders do not have the right to cumulate their votes for
directors. In the election of directors, an abstention or broker non-vote will
have no effect on the outcome.
Approval of an
Amendment to Our Certificate of Incorporation, as amended, to Increase the
Number of Authorized Shares of Common Stock. The proposal to
amend our Certificate of Incorporation, as amended, to increase the number of
authorized shares of Common Stock will be approved upon the affirmative vote of
a majority of shares of Common Stock issued and outstanding entitled to vote on
the proposal. Under Delaware law, abstentions and broker non-votes will have the
same effect as a vote against the proposed amendment to the Certificate of
Incorporation, as amended.
Approval of an
Amendment to Our 2003 Stock
Option, Deferred Stock and Restricted Stock Plan to Increase
the Number of Shares
of our Common Stock Reserved and Available for issuance under the
Plan. The
proposal to approve an amendment to our Plan to increase the number of shares of
our Common Stock reserved and available for issuance under the Plan will be
approved upon the affirmative vote of a majority of shares of Common Stock
issued and outstanding, present at the annual meeting, in person or by proxy,
and entitled to vote on the proposal. With the amendment of our Plan, an
abstention or broker non-vote will have the same effect as a vote against the
Plan Amendment. This
proposal is conditioned
upon and may become effective only in the event that the proposal
to amend our Certificate of Incorporation, as amended, to increase the number of
authorized shares of Common Stock, is approved.
Approval of an
Amendment to Our Certificate of Incorporation, as amended, providing for a
recapitalization in which the issued and outstanding shares of our Common Stock
will be reverse split in
a ratio of one-for-ten at any time prior to March 31, 2009, if at all, with the
timing thereof to be determined by the Board of Directors in its sole discretion
and decreasing the number of authorized shares of our Common Stock to
100,000,000. The proposal to approve the amendment to our
Certificate of Incorporation, as amended, to effect a reverse stock split of
Common Stock and decrease the number of authorized shares of our Common Stock,
requires the affirmative vote of a majority of the shares of Common
Stock issued and outstanding entitled to vote on the
proposal. Under Delaware law, abstentions and broker non-votes
will have the same effect as a vote against the proposed amendment to the
Certificate of Incorporation, as amended. This proposal is not conditioned upon
approval of but may be approved independent of the proposal to amend our
Certificate of Incorporation, as amended, to increase the number of authorized
shares of our Common Stock from 250,000,000 to 450,000,000. However,
if the proposal to amend our Certificate of Incorporation, as amended, to
increase the number of authorized shares of our Common Stock from 250,000,000 to
450,000,000 is approved, it will be filed with the Delaware Secretary of State
prior to this proposal to amend our Certificate of Incorporation, as amended, to
reverse split the stock and to decrease the number of authorized shares of our
Common Stock.
Ratifying the
Appointment of RBSM
LLP. The proposal
to ratify the appointment of RBSM LLP as our independent public accountants for
the year ending December 31, 2008 will be adopted upon the affirmative vote of
the majority of shares voting on the proposal. Abstentions and broker non-votes
will have no effect on the outcome.
UNLESS
OTHERWISE DIRECTED IN THE ACCOMPANYING PROXY, THE SHARES REPRESENTED BY YOUR
EXECUTED PROXY WILL BE VOTED “FOR” THE APPROVAL OF THE PROPOSALS SET FORTH IN
THIS PROXY STATEMENT.
Who pays for the preparation of this proxy?
The cost
of this solicitation of proxies will be borne by the Company. Solicitations will
be made by mail. In addition, the officers and other regularly engaged employees
of the Company may, in a limited number of instances, solicit proxies personally
or by telephone. Our representatives will not receive any compensation for
soliciting proxies other than their regular salaries or consulting fees. We may
request banks, brokers and other custodians, nominees and fiduciaries to forward
copies of the proxy material to the beneficial owners of our Common Stock and to
request authority for the execution of proxies, and we may reimburse such
persons for their expenses incurred in connection with these
activities.
Delivery of proxy materials to households
Only one
copy of the Company’s Annual Report for the fiscal year ended December 31, 2007
and Proxy Statement will be delivered to an address where two or more
stockholders reside unless the Company has received contrary instructions from a
stockholder at such address. A separate proxy card will be delivered
to each stockholder at such shared address.
If you
are a stockholder who lives at a shared address and you would like additional
copies of the Company’s Annual Report for the fiscal year ended December 31,
2007, this Proxy Statement, or any future annual reports or proxy statements,
contact the Corporate Secretary, Michelle Laroche, at (480) 922-3926 or 8767 E.
Via De Ventura, Suite 190, Scottsdale, Arizona 85258, and the Company will
promptly mail you copies.
Can
I see a list of the Stockholders entitled to vote?
Any
stockholder may look at the complete list of the Stockholders that are entitled
to vote at the annual meeting so long as it is for a purpose germane to the
annual meeting. The list will be available in these circumstances, during normal
business hours, at our offices located at 8767 E. Via De Ventura, Suite 190,
Scottsdale, AZ 85258, for a period of ten days prior to the annual meeting
and at the annual meeting itself.
What
should I have received to enable me to vote?
Your
package from us should contain this proxy statement and a proxy card. This
package is being mailed on or about May 13, 2008.
Interest of Executive Officers and Directors
None of
the Company’s executive officers or directors have any interest in any of the
matters to be acted upon at the Annual Meeting, except, that, with respect to
each director, to the extent that a director is named as a nominee for election
to the Board of Directors, and in that their ownership in the Company may be
diluted by the issuance of additional shares if the authorized capital is
increased and/or the one-for ten reverse stock split
occurs.
PROPOSALS TO OUR STOCKHOLDERS
PROPOSAL
NO. 1
ELECTION
OF DIRECTORS
The
Company’s Board of Directors is elected for a one-year term and thereafter until
their successors are duly elected and qualified or until their death,
resignation or removal. Directors are elected annually at the Annual Meeting.
The Company’s Bylaws provide for a Board of Directors with a range of between
two and nine members. The Company currently has six members on its Board of
Directors.
The first
proposal for consideration at the annual meeting is the election of a new Board
composed of the six persons set forth below. If elected, each of these directors
will hold office until the 2009 annual meeting of Stockholders or until his
earlier resignation or removal.
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Lance
K. Gordon, Ph.D.
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Robert
J. Hariri, M.D., Ph.D.
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Hal
N. Siegel, Ph.D.
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Theodore
E. Staahl, M.D.
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Michael
K. Wilhelm
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Jerome
B. Zeldis, M.D., Ph.D.
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We expect
that a majority of the Common Stock will be voted in favor of the six nominees
named above. All director nominees are currently serving as directors, and there
are no other directors continuing to serve in office. Each nominee has agreed to
be named in this proxy statement and to serve as a director if elected. For
biographical information regarding the nominees, see "Director Nominees for
Election for a One Year Term Expiring at the 2009 Annual Meeting" on page 6 of
this proxy statement.
Vote
Required and Recommendation
The
nominees for election to the Board of Directors, who receive the greatest number
of votes cast for the election of directors by the shares present, in person or
by proxy, will be elected directors. Stockholders do not have the right to
cumulate their votes for directors. In the election of directors, an abstention
or broker non-vote will have no effect on the outcome
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The
Board of Directors recommends a vote FOR election of each of the director
nominees.
How
are directors compensated?
Our
policy has been to pay no cash compensation to directors who are our employees
or affiliates for their service as directors.
Outside
directors receive for service as a member of the Company’s Board of Directors, a
grant of a non-qualified stock option to purchase shares of common stock under
the Company’s 2003 Stock Option, Deferred Stock and Restricted Stock Plan.
Furthermore, outside directors are eligible to receive monetary and/or equity
compensation, in the event they perform additional functions and achieve
milestones, as agreed. Outside directors are also reimbursed for all
out-of-pocket expenses incurred in the performance of their duties to us,
including attendance at Board meetings.
Are
our employees paid additional compensation for services as
directors?
No. We
do, however, reimburse them for travel and other related expenses.
How
often did the Board meet during 2007?
The Board
met two (2) times during 2007. All of our incumbent Board members attended 100%
of the total meetings of the Board and any Board committees on which they served
during 2007. The Company does not have a policy requiring its directors to
attend the Annual Meeting of Stockholders.
What
committees has the Board established?
The Board
has established an Executive Committee. Currently we have no
Compensation and Audit Committees. We do not maintain a standing nominating
committee or other committee performing similar functions. The function of
determining executive compensation, selecting and engaging our independent
auditors, reviewing our accounting and reporting principles and practices,
reviewing of our financial statements for each interim period and nominating
directors are all carried out by the entire Board of Directors. Our Bylaws,
however, provide a procedure for you to recommend candidates for directors at a
Stockholders meeting. For more information, see page 34 under "Shareholder
Proposals." Michael K. Wilhelm and Theodore E. Staahl, M.D. serve on
the Executive Committee. The Company intends to charter Audit and
Compensation committees in the near future.
Director Nominees for Election for a One Year Term Expiring at
the 2009 Annual Meeting
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Name
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Age
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Year
First
Appointed Director |
Position
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Lance
K. Gordon, Ph.D.
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60
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2007
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Director
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Robert
J. Hariri, M.D., Ph.D.
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48
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2007
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Director
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Hal
N. Siegel, Ph.D.
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53
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2006
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Vice-President
and Chief Scientific Officer and Director
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Theodore
E. Staahl, M.D.
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63
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2003
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Director
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Michael
K. Wilhelm
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41
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2003
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President,
Chief Executive Officer and Director
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Jerome
B. Zeldis, M.D., Ph.D.
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58
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2007
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Director
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The
persons named below will be nominated for election as directors of the Company
at this Annual Meeting to serve until the next Annual Meeting and until their
successors are elected and have qualified. Each of the nominees is
currently a director of the Company. The Board of Directors, as a
whole, identifies director nominees, evaluating candidates based on the
requirements set forth in the Company’s Bylaws and applicable regulatory
requirements.
The
following are biographical summaries for the Company’s nominees for election as
directors:
Lance K. Gordon, Ph.D.,
Director. Dr. Gordon has served on our Board of Directors since May
2007. He currently serves as President and CEO of ImmunoBiologics
Corporation, a formative biotechnology company that he founded in
2007. Prior to his work at ImmunoBiologics Corporation Dr. Gordon served as
President, Chief Executive Officer and as a Director of VaxGen, Inc. from 2001
to 2007. Prior to joining Vaxgen, Dr. Gordon was Executive Director
of North America for Acambis plc. and a member of the Company’s Board of
Directors from 1999 to 2001. Previously, he served as President and
CEO of OraVax, Inc. from 1990 to 1999, prior to its acquisition by Peptide
Therapeutics to form Acambis. Before joining OraVax, he served as the
CEO of North American Vaccine from 1988 to 1990, prior to its acquisition by
Baxter International. Dr. Gordon received his Ph.D. in Biomedical Science,
Immunology from the University of Connecticut and completed his postdoctoral
fellowship as an NIH fellow at the Division of Allergy and Immunology,
Washington University Medical School, St. Louis. He currently serves
on the DHHS National Vaccines Advisory Committee and on the Board of Trustees of
the Sabin Vaccine Institute.
Robert J. Hariri, M.D., Ph.D.,
Director. Dr. Hariri, M.D. has served on our Board of Directors since
April 2007. Dr. Hariri has been CEO of Celgene Cellular Therapeutics, a
division of Celgene, since 2005. Previously, he had been President of the
division from 2002 to 2005. The division focuses on human stem and biomaterial
solutions for a range of clinical indications. From 1998 to 2002, prior to
joining Celgene Cellular Therapeutics, Dr. Hariri was Founder, Chairman and
Chief Scientific Officer for Anthrogenesis Corp./LIFEBANK, Inc., a New
Jersey-based privately held biomedical technology and service corporation
involved in umbilical cord blood banking and its supporting technology platform.
From 1987 to 1994, he was Co-founder, Vice Chairman and Chief Scientific Officer
of Neurodynamics, a privately held medical device and technology corporation.
Dr. Hariri has held academic positions at Cornell University Medical College
Cornell University Graduate School of Medical Sciences. He has also played a
prominent medical role at Cornell University Medical College, The
New York Hospital-Cornell Medical Center and The Jamaica Hospital-Cornell Trauma
Center. While at Cornell, he was the Director of The Center for Trauma Research.
He received his Medical Degree and Ph.D. from Cornell University and was
awarded a Bachelor of Arts Degree from Columbia College.
Hal
N. Siegel, Ph.D., Vice President and Chief Scientific Officer.
Dr.
Siegel has served on the Board of Directors since June 2006. Dr.
Siegel was appointed as Chief Scientific Officer and Vice President in January
2008 after serving as our Senior Director of Product Development and Regulatory
Affairs since June 2006. Prior to joining the company, Dr. Siegel
served as Acting General Manager and Vice President Regulatory and Scientific
Affairs for Zila Biotechnology, Inc. from 2004 to October 2006. In
addition, since 2001, Dr. Siegel has provided consulting services for Siegel
Consultancy LLC, which has been providing strategic and tactical expertise to
life science companies, helping them meet FDA requirements from pre-clinical
studies through the regulatory submission process and into the post-approval
marketplace. Dr. Siegel holds degrees from Rensselaer Polytechnic
Institute and SUNY Buffalo, where he earned his Ph.D., in Biochemical
Pharmacology.
Theodore E. Staahl, M.D.,
Director. Dr. Staahl has served on our Board of Directors since April
2003. Dr. Staahl is employed at the Cosmetic, Plastic and
Reconstructive Surgery Center, a company which he founded in 1978. Dr.
Staahl's professional training was received at the University of Illinois and
the University of Wisconsin and is board certified by the American Board of
Facial, Plastic and Reconstruction Surgeons, the Board of Cosmetic Surgeons and
the American Board of Head and Neck Surgeons. Dr. Staahl has presented papers at
national and international meetings on hair transplant, rhinoplasty and cleft
lip deformities.
Michael K. Wilhelm, President, Chief
Executive Officer And Director. Michael K. Wilhelm has been our President
and Chief Executive Officer and a member of our Board of Directors since July
2003. Mr. Wilhelm has been President and Chief Executive Officer and a member of
the Board of Directors since co-founding ImmuneRegen BioSciences, Inc., our
wholly-owned subsidiary, in December 2002. Mr. Wilhelm has served as
Managing Director of Foresight Capital Corporation since July 1996, a company he
founded to consult and assist early-stage companies in furthering their growth
and development. Mr. Wilhelm retains the title of Managing Director of Foresight
Capital Corporation, but the company has had limited and insignificant business
operations since December 2002.
Jerome B. Zeldis, M.D., Ph.D.,
Director. Dr. Zeldis has served on our Board of Directors
since November 2007. Dr. Zeldis currently serves as Chief Medical Officer of
Celgene Corporation, Warren N.J., a position he has held since
1997. He is also currently, and since 2003, Professor of Clinical
Medicine at the Robert Wood Johnson Medical School in New Brunswick,
N.J. Prior to working at Celgene, Dr. Zeldis worked at Sandoz
Research Institute from 1994 to 1995 and Janssen Research Institute from 1995 to
1997 in both clinical research and medical development. He has been a
Board member of a few start-up biotechnology companies and is currently on the
Board of the Semorex Corporation, the N.J. Chapter of the Arthritis Foundation,
and the Castleman’s Disease Organization.
The
following table sets forth the names and positions of all of our current
directors and executive officers.
|
Name
|
Age
|
Position
|
||
|
Michael
K. Wilhelm
|
41
|
President,
Chief Executive Officer and Director
|
||
|
John
N. Fermanis
|
54
|
Chief
Financial Officer
|
||
|
Hal
N. Siegel, Ph.D.
|
53
|
Vice-President and
Chief Scientific Officer
|
||
|
Lance
K. Gordon, Ph.D.
|
60
|
Director
|
||
|
Robert
J. Hariri, M.D., Ph.D.
|
48
|
Director
|
||
|
Theodore
E. Staahl, M.D.
|
63
|
Director
|
||
|
Jerome
B. Zeldis, M.D., Ph.D.
|
58
|
Director
|
Biographical
information about our directors and officers except Mr. John N. Fermanis are
included under the caption, “Director Nominees for Election for a One Year Term
Expiring at the 2009 Annual Meeting”.
John N. Fermanis, Chief Financial
Officer. Mr. Fermanis has served as our Chief Financial Officer since
December 2004. From May 2001 to October 2004 Mr. Fermanis served as Chief
Financial Officer of AMPS Wireless Data, Inc., a privately held Arizona
corporation which he co-founded in 1998. From 1997 to 2001, Mr. Fermanis held
the position of Treasury Manager for Peter Piper, Inc., a national restaurant
chain headquartered in Scottsdale, Arizona. Mr. Fermanis has over 18 years of
financial management experience with both the American Express Corporation and
Citigroup in New York City. Mr. Fermanis holds a Bachelor of Arts degree from
the S.U.N.Y. at Stony Brook and attended Pace University's Graduate School
of Management in New York City.
There are no family relationships among
the directors and executive officers.
EXECUTIVE COMPENSATION
Summary Compensation Table
The
following table sets forth information concerning the compensation for the two
fiscal years ended December 31, 2007 and 2006, of our principal executive
officer, our two most highly compensated executive officers other than our
principal executive officer whose annual compensation exceeded $100,000, and up
to two additional individuals for whom disclosure would have been made in this
table but for the fact that the individual was not serving as an executive
officer of our company at December 31, 2007, if any (collectively, the “Named
Executive Officers”).
|
Name
and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)(2)
|
All
Other
Compensation
($)(3)
|
Total
($)
|
|||||||||||||||||||||
|
Michael
K. Wilhelm
|
||||||||||||||||||||||||||||
|
President,
CEO and
|
2007
|
$ | 315,414 | $ | 82,239 | — | $ | 883,544 | $ | 15,820 | $ | 1,297,017 | ||||||||||||||||
|
Director
|
2006
|
$ | 286,317 | $ | 41,278 | (1 | ) | — | $ | 735,731 | $ | 5,955 | $ | 1,069,281 | ||||||||||||||
|
John
N. Fermanis
|
2007
|
$ | 112,000 | $ | 5,800 | — | $ | 230,051 | $ | 5,994 | $ | 353,845 | ||||||||||||||||
|
Chief
Financial Officer
|
2006
|
$ | 98,000 | $ | 17,596 | (1 | ) | — | — | — | $ | 115,596 | ||||||||||||||||
|
Hal
N. Siegel
|
||||||||||||||||||||||||||||
|
Vice-President
|
2007
|
$ | 201,884 | — | — | $ | 263,147 | — | $ | 465,031 | ||||||||||||||||||
|
and
Chief Scientific Officer
|
2006
|
$ | 42,308 | — | — | $ | 32,071 | $ | 95,574 | $ | 169,953 | |||||||||||||||||
|
(1)
|
The
amounts shown are the amounts of compensation cost recognized by us in
fiscal year 2006 related to the issuance of cash and common stock purchase
warrants as bonus in fiscal year 2006 and prior fiscal
years.
|
|
Named Executive
Officer
|
Issue
Date
|
Price
|
Underlying
Warrants
|
Compensation
Cost
|
||||||
|
Michael
K. Wilhelm
|
July
14, 2006
|
$
|
0.250
|
300,000
|
$
|
41,278
|
||||
|
John
N. Fermanis
|
July
14, 2006
|
$
|
0.158
|
62,500
|
$
|
9,596
|
||||
|
|
|
|
(2)
|
The
amounts shown are the amounts of compensation cost recognized by us in
fiscal year 2007 related to the grants of stock options in fiscal year
2007 and prior fiscal years, as described in Statement of Financial
Accounting Standards No. 123R. For a discussion of valuation assumptions,
see Note A to our 2007 Consolidated Financial Statements included in our
annual report on Form 10-K for the year ended December 31, 2007; excluding
any assumptions for forfeitures. The table below shows how much of the
overall amount of the compensation cost is attributable to each
award.
|
|
Named Executive
Officer
|
Grant
Date
|
Price
($)
|
Underlying
Options
|
Compensation
Cost
|
||||||
|
Michael
K. Wilhelm
|
August
1, 2007
|
$
|
0.166
|
2,000,000
|
$
|
330,975
|
||||
|
August
1, 2007
|
$
|
0.195
|
500,000
|
$
|
81,112
|
|||||
|
September
13, 2006
|
$
|
0.220
|
3,500,000
|
$
|
469,247
|
|||||
|
July
14, 2006
|
$
|
0.231
|
1,896,970
|
$
|
266,484
|
|||||
|
August
10, 2005
|
$
|
0.330
|
103,030
|
$
|
27,513
|
|||||
|
May
20, 2005
|
$
|
0.440
|
150,000
|
$
|
55,399
|
|||||
|
Hal
N. Siegel
|
August
1, 2007
|
$
|
0.166
|
1,100,000
|
$
|
182,035
|
||||
|
August
1, 2007
|
$
|
0.195
|
500,000
|
$
|
81,112
|
|||||
|
October
23, 2006
|
$
|
0.200
|
200,000
|
$
|
32,071
|
|||||
|
John
N. Fermanis
|
August
1, 2007
|
$
|
0.166
|
900,000
|
$
|
148,939
|
||||
|
August
1, 2007
|
$
|
0.195
|
500,000
|
$
|
81,112
|
|||||
|
(3)
|
The
amounts shown are the amounts of compensation cost recognized by us in
fiscal year 2006 related to the issuance of Common Stock purchase warrants
in fiscal year 2006 and prior fiscal
years.
|
|
Named Executive
Officer
|
Issue
Date
|
Price
($)
|
Underlying
Warrants
|
Compensation
Cost
|
||||||
|
Hal
N. Siegel
|
September
30, 2006
|
$
|
1.000
|
2,500
|
$
|
156
|
||||
|
June
30, 2006
|
$
|
1.000
|
2,500
|
$
|
213
|
|||||
|
March
31, 2006
|
$
|
0.125
|
9,000
|
$
|
2,267
|
|||||
|
December
31, 2005
|
$
|
0.125
|
9,000
|
$
|
2,242
|
|||||
|
September
30, 2005
|
$
|
0.125
|
9,000
|
$
|
3,003
|
|||||
|
June
30, 2005
|
$
|
0.125
|
9,000
|
$
|
2,242
|
|||||
|
March
31, 2005
|
$
|
0.125
|
900
|
$
|
352
|
|||||
|
March
12, 2005
|
$
|
0.125
|
3,000
|
$
|
1,173
|
|||||
Automobile
Leases
In
October 2006, the Company signed a three-year lease agreement for an automobile
for the Company's Chief Executive Officer. The rental cost per month is
approximately $1,318. The total cost recognized by us in fiscal year 2007
related to the automobile lease was $15,820.
In
December 2006, the Company signed a two-year lease agreement for an automobile
for the Company's Chief Financial Officer. The rental cost per month is
approximately $499. The total cost recognized by us in fiscal year 2007 related
to the automobile lease was $5,994.
Option Grants in Fiscal Year 2007
In August
2007, we granted options to purchase 2,500,000 shares of Common Stock to our
Chief Executive Officer, Michael K. Wilhelm. The options vest 100% after thirty
days of continued employment.
In July
2006, we granted options to purchase 1,896,970 shares of Common Stock to our
Chief Executive Officer, Michael K. Wilhelm. The options vest 50% after ninety
days of continued employment and the balance in equal monthly installments for
12 months thereafter.
In
September 2006, we issued options to purchase 3,500,000 shares of Common Stock
to our Chief Executive Officer, Michael K. Wilhelm. The options vest 50% after
thirty days of continued employment with the balance in equal monthly
installments for 12 months thereafter.
In August
2007, we granted options to purchase 1,600,000 shares of Common Stock to our
Vice-President, Chief Scientific Officer and Director, Hal N. Siegel. The
options vest 100% after thirty days of continued employment.
In
October 2006, we issued options to purchase 200,000 shares of Common Stock to
our Senior Director, Product Development and Regulatory Affairs and Director,
Hal N. Siegel.
In August
2007, we granted options to purchase 1,400,000 shares of Common Stock to our
Chief Financial Officer, John N. Fermanis. The options vest 100% after thirty
days of continued employment.
As of
December 31, 2007, total unrecognized stock-based compensation expense related
to stock options was $12,420. During the year ended December 31, 2006 we charged
$264,274 to operations related to recognized stock-based compensation expense
for employee stock options.
President
and Chief Executive Officer:
On August
10, 2005, we entered into a new employment agreement with our President and
Chief Executive Officer, Michael K. Wilhelm. The employment agreement calls for
a salary at the rate of $275,000 per annum. The salary will be subject to
adjustment of at least 10% per year at the end of each year. We also agreed to
defend and indemnify, to the fullest extent permitted by our certificate of
incorporation and bylaws and the Delaware General Corporation Law, Mr. Wilhelm
and hold him harmless against any liability that he incurs within the scope of
his employment under the agreement. The agreement also provides for the
following various bonus incentives:
|
|
i)
A target incentive bonus in cash and/or stock if we consummate a
transaction with any unaffiliated third party such as an equity or debt
financing, acquisition, merger, strategic partnership or other similar
transaction.
|
ii) A one
time grant of an option to purchase 2,000,000 shares of our Common Stock at an
exercise price equal to the fair market value per share on the date option is
granted.
In
connection with Mr. Wilhelm's new employment agreement, we also entered into a
change of control agreement and a severance agreement with him on August 10,
2005. Under the change of control agreement, Mr. Wilhelm shall be
entitled to a continuation of his base salary for a period of 18 months
following an involuntary termination, which means, at any time within that
period which is one-year from the change of control date (including such date),
the termination of the employment of Mr. Wilhelm (i) by us without cause or (ii)
due to constructive termination, as such terms are defined in the change of
control agreement. Further, in the event of an involuntary termination, the
agreement provides that the registrant shall pay Mr. Wilhelm a lump sum amount
in cash, equal to the sum of (i) any unpaid incentive compensation which has
been allocated or awarded to Mr. Wilhelm for a completed fiscal year or other
measuring period preceding the date of involuntary termination under any annual
or long-term incentive plan and which, as of the date of involuntary
termination, is contingent only upon the continued employment of Mr. Wilhelm to
a subsequent date, and (ii) a pro rata portion to the date of involuntary
termination of the aggregate value of all contingent incentive compensation
awards to Mr. Wilhelm for all then uncompleted periods under any such plan.
Further, 100% of the unvested portion of each outstanding stock option granted
to Mr. Wilhelm shall be accelerated so that they become immediately exercisable
upon the date of involuntary termination.
Under the
severance agreement, Mr. Wilhelm shall be entitled to a continuation of his base
salary for a period of 18 months following an involuntary termination, which
means the termination of the employment of Mr. Wilhelm (i) by us without cause
or (ii) due to constructive termination, as such terms are defined in the
severance agreement. Further, in the event of an involuntary termination, the
agreement provides that the registrant shall pay Mr. Wilhelm an amount equal to
the amount of executive incentive pay (bonus) that he would have received for
the year in which the involuntary termination occurred had he met one hundred
percent (100%) of the target for such incentive pay. Also, under this agreement,
100% of the unvested portion of each outstanding stock option granted to Mr.
Wilhelm shall be accelerated so that they become immediately exercisable upon
the date of involuntary termination.
Chief
Financial Officer:
Pursuant
to our employment agreement with John Fermanis, our Chief Financial Officer,
dated February 15, 2005, we paid a salary of $60,000 until we completed a
financing of $500,000 or more. This occurred on March 4, 2005 when we completed
a Tender Offer for warrants totaling $1,190,857 net of fees. From March 4, 2005,
until December 31, 2005, we paid an annual salary of $85,000. Thereafter, we
paid an annual salary of $98,000 for the second year ending December 31, 2006
and an annual salary of $112,000 for the third year ending December 31, 2007.
Mr. Fermanis' salary is payable in regular installments in accordance with our
customary payroll practices. Mr. Fermanis also received 100,000 shares of our
Common Stock, which were earned at the rate of 1/12 or 8,333 per month beginning
January 2005. We charged to operations the market value of these shares as of
the first day of each month. For the twelve months ended December 31, 2006, we
charged $41,416 to operations for the issuance of 100,000 shares to Mr.
Fermanis.
Pursuant
to terms of our employment agreement with Mr. Fermanis, our Chief Financial
Officer, dated January 1, 2008, we pay an annual base salary of $130,000 for the
first year and $140,000 for the second year. Mr. Fermanis will also
be eligible for discretionary bonuses under the Company’s stock option plan
during his employment. The employment agreement has a term of two
years, subject to early termination provisions. The Company may
terminate the employment agreement at any time for cause, as defined in the
employment agreement, and upon 15 days written notice without
cause. Mr. Fermanis may terminate the employment agreement for any
reason with 30 days written notice. Upon termination of Mr. Fermanis’
employment by the Company without cause or constructive termination, as defined
in the employment agreement, the Company agrees to pay to Mr. Fermanis the
remainder of his salary for the year or six months salary, whichever is greater,
and any accrued vacation. Pursuant to the terms of the employment
agreement, Mr. Fermanis may not compete against the Company and he may not
solicit the Company’s customers during the term of the employment agreement and
for a period of three years following the termination of his employment
agreement. Mr. Fermanis also may not disclose any confidential
information during or within three years after his employment.
Vice
President and Chief Scientific Officer:
Pursuant
to our employment agreement with Hal N. Siegel, our Vice President and Chief
Scientific Officer, dated October 23, 2006, we will pay an annual base salary of
$200,000 for the first year and $210,000 for the second year. Mr. Siegel will
also be eligible for discretionary bonuses under our stock option plan during
his employment. In addition, Mr. Siegel received options with a term of five
years to purchase 200,000 shares of our Common Stock. The options are
exercisable at $0.20 per share. The employment agreement has a term of two
years, subject to early termination provisions. Upon termination of Mr. Siegel's
employment by us without cause or constructive termination, as defined in the
agreement, we agree to pay to Mr. Siegel the remainder of his salary for the
year or six months salary, whichever is greater, and any accrued
vacation.
In
addition, we entered into a change of control agreement with Hal
Siegel. Pursuant to the terms of the change of control agreement, we
agree to pay Mr. Siegel his salary for a period of 18 months from the date of an
involuntary termination, payable in accordance with our compensation practice.
Involuntary termination is defined as the termination of Mr. Siegel's employment
by us without cause or due to constructive termination at any time within
one-year of a change of control event, as defined in the agreement.
Outstanding Equity Awards at Fiscal Year-End as of December 31,
2007
As of the
year ended December 31, 2007, the following Named Executive Officers had the
following outstanding equity awards:
|
Option
Awards
|
|||||||||||||||
|
Name
|
Number
of
Securities
Underlying
Unexercised
Options
#
Exercisable
|
Number
of
Securities
Underlying
Unexercised
Options
#
Unexercisable
|
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised
Unearned Options
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
||||||||||
|
Michael
K. Wilhelm
|
1,896,970
|
—
|
—
|
$
|
0.231
|
7/14/2011
|
|||||||||
|
President,
CEO and
|
454,545
|
—
|
—
|
$
|
0.220
|
9/13/2011
|
|||||||||
|
Director
|
3,045,455
|
—
|
—
|
$
|
0.220
|
9/13/2011
|
|||||||||
|
2,000,000
|
—
|
—
|
$ |
0.166
|
7/31/2017
|
||||||||||
|
500,000
|
—
|
—
|
$ |
0.195
|
7/31/2017
|
||||||||||
|
John
N. Fermanis
|
900,000
|
—
|
—
|
$
|
0.166
|
7/31/2017
|
|||||||||
|
Chief
Financial Officer
|
500,000
|
—
|
—
|
$
|
0.195
|
7/31/2017
|
|||||||||
|
Hal
N. Siegel
|
200,000
|
—
|
—
|
$
|
0.200
|
10/23/2011
|
|||||||||
|
Vice-President
|
1,100,000
|
—
|
—
|
$ |
0.166
|
7/31/2017
|
|||||||||
|
and
Chief Scientific Officer
|
500,000
|
—
|
—
|
$ |
0.195
|
7/31/2017
|
|||||||||
Director Compensation
|
Name
|
Fees
Earned
or
Paid in
Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive
Plan
Compensation
($)
|
Nonqualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compensation
($)
|
Total
($)
|
||||||||||
|
Lance
K. Gordon, Ph.D.
|
$
|
—
|
—
|
165,457
|
—
|
—
|
—
|
$
|
165,457
|
||||||||
|
Robert
J. Hariri, M.D., Ph.D.
|
—
|
—
|
330,974
|
—
|
—
|
—
|
330,974
|
||||||||||
|
Theodore
E. Staahl, M.D.
|
—
|
—
|
41,372
|
—
|
—
|
—
|
41,372
|
||||||||||
|
Jerome
B. Zeldis, M.D., Ph.D.
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||
|
Mark
L. Witten, Ph.D. (1)
|
$
|
5,000
|
--
|
--
|
--
|
--
|
--
|
$
|
5,000
|
|
(1)
|
Mark
L. Witten, Ph.D. resigned as a member of the Board of Directors on May 18,
2006. On December 16, 2002 we entered into a consulting agreement with
Mark Witten, our chief research scientist and director. The consulting
agreement was entered into on a month-to-month basis. Under the terms of
this agreement, Dr. Witten agreed to place at our disposal his judgment
and expertise in the area of acute lung injury. In consideration for these
services, we agreed to pay Dr. Witten a non-refundable fee of $5,000 per
month. This contract was terminated effective February 1,
2006.
|
Compensation of
Directors
Standard
Arrangements. Directors currently receive no cash compensation from IR
BioSciences Holdings, Inc. for their services as members of the Board or for
attendance at committee meetings. Members of the Board are reimbursed for some
expenses in connection with attendance at Board and committee
meetings.
Other
Arrangements.
Subject
to approval by our Board of Directors, we may from time to time issue options
and/or warrants to executives and directors for fulfilling certain performance
goals.
LONG TERM INCENTIVES
Executive
officers, together with our other employees, are eligible to receive grants of
awards under our 2003 Stock Option, Deferred Stock and Restricted Stock Plan.
These awards may be in the form of stock options and/or restricted stock grants.
The number of shares underlying options or shares, together with all other terms
of the options and shares, are established by the Board of
Directors.
Stock
Incentive Plans
2003
Stock Option, Deferred Stock and Restricted Stock Plan
Nature of the
Plan. We adopted our 2003 Stock Option, Deferred Stock and
Restricted Stock Plan (the “Plan”) which authorizes the Board of Directors in
accordance with the terms of the Plan, among other things, to grant incentive
stock options as defined by Section 422(b) in the Internal Revenue Code,
nonstatutory stock options and awards of restricted stock and deferred stock and
to sell shares of our Common Stock pursuant to the exercise of such stock
options. On June 28, 2006, our Stockholders voted to approve an amendment to our
2003 Stock Option, Deferred Stock and Restricted Stock Plan to increase the
number of shares of our Common Stock reserved and available for issuance under
the plan from 3,600,000 to 20,000,000. Grants of Awards representing 19,924,972
shares of our Common Stock have been made under the Plan with exercise prices
ranging from $0.066 to $0.44. As of April 25, 2008 we had a balance
of 75,028 shares of our Common Stock reserved and available for issuance under
the Plan.
Purpose.
The primary purpose of the Plan is to attract and retain the best available
personnel in order to promote the success of our business and to facilitate the
ownership of our stock by employees and others who provide services to
us.
Administration.
The Plan is administered by our Board of Directors, as the Board of Directors
may be composed from time to time. Notwithstanding the foregoing, the Board of
Directors may at any time, or from time to time, appoint a committee of at least
two members of the Board of Directors, and delegate to the committee the
authority of the Board of Directors to administer the Plan. Upon such
appointment and delegation, the committee shall have all the powers, privileges
and duties of the Board of Directors, and shall be substituted for the Board of
Directors, in the administration of the Plan, subject to certain
limitations.
Eligibility.
Under the Plan, options to purchase shares and the award of shares of Common
Stock may be granted to employees, officers, directors or consultants of the
Company.
Terms of
Options. The term of each option granted under the Plan shall be
contained in a stock option agreement between the optionee and the Company and
such terms shall be determined by the Board of Directors consistent with the
provisions of the Plan, including the following:
(a) Purchase Price. The purchase
price of the Common Stock subject to each incentive stock option shall not be
less than the fair market value of our Common Stock at the time of the grant (as
set forth in the Plan), or in the case of the grant of an incentive stock option
to a principal stockholder, not less that 110% of fair market value of our
Common Stock at the time such option is granted. The purchase price of the
Common Stock subject to each Non-Qualified stock option shall be determined at
the time such option is granted, but in no case less than 85% of the fair market
value of such Common Stock at the time such option is granted;
(b) Vesting. The dates on which
each option (or portion thereof) shall be exercisable and the conditions
precedent to such exercise, if any, shall be fixed by the Board of Directors, in
its discretion, at the time such option is granted. The Board of Directors may,
in its discretion, declare that the restrictions applicable to any Restricted
Stock or Deferred Stock awards under the Plan shall be deemed fully or partially
vested upon a change of control transaction as described in the
Plan;
(c) Expiration. The expiration of
each option shall be fixed by the Board of Directors, in its discretion, at the
time such option is granted; however, unless otherwise determined by the Board
of Directors at the time such option is granted, an option shall be exercisable
for up to ten years after the date on which it was granted, or five years for
grants to a 10% shareholder;
(d) Transferability. No Stock
Option shall be transferable by the optionee otherwise than by will or by the
laws of descent and distribution. Incentive Stock Options shall be exercisable,
during the optionee’s lifetime, only by the optionee;
(e) Option Adjustments. In the
event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, reverse stock split or other change in corporate
structure affecting our Common Stock, an appropriate substitution or adjustment
shall be made in (i) the aggregate number of shares reserved for issuance under
the Plan, and (ii) the kind, number and option price of shares subject to
outstanding Awards granted under the Plan as may be determined by the
Administrator, in its sole discretion, provided that the number of shares
subject to any Award shall always be a whole number;
(f) Termination, Modification And
Amendment. The Plan (but not options previously granted under the Plan)
shall terminate ten years from the date of its adoption by the Board of
Directors, and no option or shares shall be granted after termination of the
Plan. Subject to certain restrictions, the Plan may at any time be terminated
and from time to time be modified or amended by the affirmative vote of the
holders of a majority of the outstanding shares of the capital stock of the
Company present, or represented, and entitled to vote at a meeting duly held in
accordance with the applicable laws of the State of Delaware.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The
following table sets forth certain information relating to the ownership of
Common Stock by (i) each person known by us be the beneficial owner of more than
five percent of the outstanding shares of our Common Stock, (ii) each of our
directors, (iii) each of our named executive officers, and (iv) all of our
executive officers and directors as a group. Unless otherwise indicated, the
information relates to these persons, beneficial ownership as of April 25, 2008.
Except as may be indicated in the footnotes to the table and subject to
applicable community property laws, each person has the sole voting and
investment power with respect to the shares owned.
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Name
of Beneficial Owner (1)
|
Common
Stock
Beneficially
Owned(2)
|
Percentage
of
Common
Stock (3)
|
||||||||||
|
Michael
K. Wilhelm
|
12,134,671 | (4 | ) | 9.6 | % | |||||||
|
John
N. Fermanis
|
1,580,000 | (5 | ) | 1.3 | % | |||||||
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Hal
N. Siegel, Ph.D.
|
1,956,000 | (6 | ) | 1.7 | % | |||||||
|
Lance
K. Gordon, Ph.D.
|
1,000,000 | (7 | ) | * | % | |||||||
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Robert
J. Hariri, M.D., Ph.D.
|
3,210,545 | (8 | ) | 2.7 | % | |||||||
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Theodore
E. Staahl, M.D.
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3,796,261 | (9 | ) | 3.3 | % | |||||||
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Jerome
B. Zeldis, M.D., Ph.D.
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250,000 | (10 | ) | * | ||||||||
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Mark
Witten, Ph.D.
1501
N. Campbell Avenue
Room
3352
Tucson,
AZ 85724
|
6,660,778 | (11 | ) | 5.7 | % | |||||||
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All
executive officers and directors as a group (6 persons)
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23,677,477 | (12 | ) | 17.8 | % | |||||||
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_____________________
|
|
*
Less than 1 percent.
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(1)
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Except
as otherwise indicated, the address of each beneficial owner is c/o IR
BioSciences Holdings, Inc., 8767 E. Via De Ventura, Suite 190, Scottsdale,
Arizona 85258.
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(2)
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Beneficial
ownership is determined in accordance with the rules of the Securities and
Exchange Commission. In general, a person who has voting power or
investment power with respect to securities is treated as beneficial owner
of those securities. Common shares subject to options and warrants
currently exercisable or exercisable within 60 days of April 25, 2008
count as outstanding for computing the percentage beneficially owned by
the person holding these options or
warrants.
|
|
(3)
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Percentages
are based on 116,017,539 shares of Common Stock outstanding as of April
25, 2008.
|
|
(4)
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Includes
1,870,141 shares of common stock underlying
warrants
|
|
Number of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 448,980 |
0.125
|
3/18/09
|
||||
| 250,000 |
0.250
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4/13/09
|
||||
| 250,000 |
0.250
|
|
4/13/09
|
|||
| 75,000 |
0.250
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5/17/09
|
||||
| 5,000 |
2.000
|
|
7/22/09
|
|||
| 80,000 |
0.050
|
7/22/09
|
||||
| 1,550 |
2.000
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8/18/09
|
||||
| 20,800 |
0.090
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8/18/09
|
||||
| 358,000 |
0.500
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10/29/09
|
||||
| 80,811 |
0.300
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5/20/10
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||||
| 300,000 |
0.250
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7/14/11
|
||||
| 1,870,141 | ||||||
and
8,150,000 shares of common stock underlying options
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 150,000 |
0.440
|
5/19/10
|
||||
| 103,030 |
0.330
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8/9/10
|
||||
| 1,896,970 |
0.231
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7/13/11
|
||||
| 454,545 |
0.220
|
9/12/11
|
||||
| 3,045,455 |
0.220
|
9/12/11
|
||||
| 2,000,000 |
0.166
|
7/31/17
|
||||
| 500,000 |
0.195
|
7/31/17
|
||||
| 8,150,000 | ||||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
Includes
461,602 shares of common stock and 61,000 common stock purchase warrants held by
immediate family members that are currently exercisable or exercisable within 60
days of April 25, 2008.
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 20,000 |
0.25
|
7/30/09
|
||||
| 20,000 |
|
0.125
|
12/31/08
|
|||
| 20,000 |
0.125
|
12/31/08
|
||||
| 1,000 |
1.00
|
12/31/08
|
||||
| 61,000 | ||||||
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(5)
|
Includes
80,000 shares of common stock underlying
warrants
|
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 5,000 |
0.25
|
5/6/09
|
||||
| 12,500 |
0.308
|
5/6/10
|
||||
| 62,500 |
0.158
|
7/14/11
|
||||
| 80,000 | ||||||
and
1,400,000 shares of common stock underlying options
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 900,000 |
0.166
|
7/31/17
|
||||
| 500,000 |
0.195
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7/31/17
|
||||
| 1,400,000 | ||||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
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(6)
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Includes
46,000 shares of common stock underlying
warrants
|
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 5,000 |
0.25
|
5/6/09
|
||||
| 9,000 |
0.125
|
6/30/08
|
||||
| 9,000 |
0.125
|
9/30/08
|
||||
| 9,000 |
0.125
|
12/31/08
|
||||
| 9,000 |
0.125
|
3/31/09
|
||||
| 2,500 |
1.00
|
6/30/09
|
||||
| 2,500 |
1.00
|
9/30/09
|
||||
| 46,000 | ||||||
and
1,800,000 shares of common stock underlying options
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 200,000 |
0.20
|
10/22/11
|
||||
| 1,100,000 |
0.166
|
7/31/17
|
||||
| 500,000 |
0.195
|
7/31/17
|
||||
| 1,800,000 | ||||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
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(7)
|
Includes
1,000,000 shares of common stock underlying
options
|
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 1,000,000 |
0.166
|
7/31/17
|
||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
|
(8)
|
Includes
2,000,000 shares of common stock underlying
options
|
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 1,000,000 |
0.166
|
7/31/17
|
||||
| 1,000,000 |
0.166
|
7/31/17
|
||||
| 2,000,000 | ||||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
Includes
625,000 shares of common stock and 312,500 common stock purchase
warrants
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 312,000 |
0.50
|
12/6/11
|
||||
held by
The Hariri Family Limited Partnership, a partnership that our director is
the administrative manager thereof that are currently exercisable or exercisable
within 60 days of April 25, 2008.
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(9)
|
Includes
160,000 shares of common stock underlying
warrants
|
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 80,000 |
0.038
|
7/1/08
|
||||
| 80,000 |
0.05
|
7/27/09
|
||||
| 160,000 | ||||||
and
250,000 shares of common stock underlying options
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 250,000 |
0.166
|
7/31/17
|
||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
Includes
35,000 common stock purchase warrants issued by third that are currently
exercisable or exercisable within 60 days of April 25, 2008.
|
(10)
|
Includes
250,000 shares of common stock underlying
options
|
|
Number
of Options
|
Strike
Price ($)
|
Expiration
Date
|
||||
| 250,000 |
0.0663
|
3/28/18
|
||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
|
(11)
|
Includes
712,000 shares of common stock underlying
warrants
|
|
Number
of Warrants
|
Exercise
Price ($)
|
Expiration
Date
|
||||
| 50,000 |
0.25
|
4/13/09
|
||||
| 250,000 |
|
0.25
|
4/13/09
|
|||
| 362,000 |
0.50
|
10/29/09
|
||||
| 50,000 |
0.125
|
5/6/10
|
||||
| 712,000 | ||||||
that are
currently exercisable or exercisable within 60 days of April 25,
2008.
|
(12)
|
Includes:
(i) 2,156,141 shares of common stock underlying warrants; (ii) 14,600,000
shares of common stock underlying stock options; (iii) 461,602 shares of
common stock and 61,000 common stock purchase warrants held by immediate
family members; and, (iv) 625,000 shares of common stock and 312,500
common stock purchase warrants held by a partnership that a director is
the administrative manager that are currently exercisable or exercisable
within 60 days of April 25, 2008.
|
The
information as to shares beneficially owned has been individually furnished by
our respective directors, named executive officers and other Stockholders, or
taken from documents filed with the SEC.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
INDEPENDENCE
None of
the Company’s executive officers or directors have any interest in any of the
matters to be acted upon at the Annual Meeting, except, that, with respect to
each director, to the extent that a director is named as a nominee for election
to the Board of Directors, and in that their ownership in the Company may be
diluted by the issuance of additional shares if the authorized capital is
increased and/or the one-for ten reverse stock split occurs.
Review, Approval Or
Ratification Of Transactions With Related Persons
The
Company’s policies and procedures for reviewing, approving, and ratifying
transactions with related persons are overseen by the Board of
Directors.
Transactions With Related
Persons
Based on
information provided by the directors and the executive officers, the Board
determined that there were no related person transactions to be reported in this
proxy statement.
STOCK PERFORMANCE GRAPH(1)
The
following graph compares the cumulative stockholder return through December 31,
2007 on the Company’s common stock with the cumulative total return of a broad
market index, the NASDAQ Composite Index, and an industry index, the NASDAQ
Biotechnology Index. The graph assumes that $100 was invested on
December 31, 2002 and assumes reinvestment of the full amount of all dividends
and are calculated as of as of December 31 of each year. The
comparisons in this table are required by the applicable SEC regulations and are
not intended to forecast or be indicative of possible future performance of IR
BioSciences Holdings, Inc.’s common stock The information presented
in the graph was obtained by the Company from outside sources it considers to be
reliable but has not been independently verified by the Company.
(1)
This Section is not “soliciting material,” is not deemed “filed” with the SEC
and is not to be incorporated by reference in any filing of the Company under
the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934,
as amended, whether made before or after the date hereof and irrespective of any
general incorporation language in any such filing.
PROPOSAL 2
APPROVAL
OF AN AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO
INCREASE
THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK.
Description
of Proposed Amendment
On April
19, 2008, the Board of Directors unanimously approved an amendment to the
Company’s Certificate of Incorporation, as amended, subject to stockholder
approval, to increase the number of authorized shares of Common Stock from
250,000,000 to 450,000,000 to be effected upon the filing with the Secretary of
State of the State of Delaware the appropriate amendment to our Certificate of
Incorporation, as amended (the “Increased Common Stock
Amendment”). The full text of the proposed Increased Common Stock
Amendment is set out in Appendix A to
this Proxy Statement. The text of the proposed Increased Common Stock
Amendment is subject to modification to include such changes as may be required
by the office of the Secretary of State of Delaware or as our Board of Directors
deems necessary and advisable to effect the increase in the number of authorized
shares of Common Stock. The
Increased Common Stock Amendment does not include a change in the number of
authorized shares of Preferred Stock.
The
stockholders are being asked to approve the Amendment.
Required
Vote
The
affirmative vote of a majority of the issued and outstanding shares of Common
Stock entitled to vote at the Annual Meeting of Stockholders is required to
approve the foregoing proposal. As a result, abstentions and broker non-votes
will have the same effect as negative votes. In the absence of instructions to
the contrary, proxies covering the common stock will be voted for the
amendment.
The
Board of Directors recommends a vote FOR the proposal to approve the amendment
to the Company's Certificate of Incorporation, as amended,
to
increase the number of authorized shares of Common Stock from 250,000,000 to
450,000,000.
If the
Stockholders approve this proposal, the Board of Directors will have the
authority without any further action on the part of the Stockholders and will
file the Increased Common Stock Amendment with the Delaware Secretary of State
at any time after the approval of the Increased Common Stock
Amendment. The filing with the Delaware Secretary of State will be
made prior to any filing of the Reverse Split Amendment as discussed in Proposal
No. 4 below. If the proposal is not approved by the stockholders, the
Increased Common Amendment will not be filed and the proposal will not be
implemented.
Reasons
for the Increased Common Stock Amendment
We
currently have 250,000,000 shares of Common Stock authorized for issuance. We
effected a two-for-one forward split of our Common Stock in April
2004. In connection with the increase in the number of authorized
shares of Common Stock, the Board has determined that it is in the best
interests of the Company and its stockholders to increase the number of
authorized shares of Common Stock from 250,000,000 to 450,000,000. The increase
would become effective upon filing the proposed Increased Common Stock Amendment
with the Secretary of State of the State of Delaware or such later date as may
be set forth in the Certificate of Amendment.
The Board
determined to increase the number of authorized shares of Common Stock because
it believes that the current number is insufficient for existing and future
corporate purposes, and the increase is needed to provide flexibility for
issuances of Common Stock to raise additional capital, for strategic business
opportunities that may be presented from time to time and to allow additional
shares of Common Stock to be reserved and available for issuance under our 2003
Stock Option, Deferred Stock and Restricted Stock Plan. The Company
has no plans, agreements, arrangements or understandings to issue any additional
shares of common stock at this time.
Shares
of Common Stock Issued and Outstanding
The
Company is currently authorized to issue a maximum of 250,000,000 shares of
Common Stock. As of the Record Date of April 28, 2008, there were approximately
116,017,539 shares of Common Stock issued and outstanding. As
of that date, an additional 58,739,637 shares of Common Stock were issuable upon
exercise of outstanding stock options and warrants, an additional 75,028 shares
were reserved under our stock option plans for future grants of options,
50,695,000 shares are reserved per outstanding contracts and convertible debt
obligations. The Increased Common Stock Amendment will not change the
number of outstanding shares of Common Stock but will provide the Board with the
ability to issue additional shares of Common Stock as it determines to be for
proper corporate purposes and in the best interests of the Company.
The
holders of our Common Stock are entitled to one vote per share on all matters
submitted to a vote of our stockholders. In addition, such
holders are entitled to receive ratably such dividends, if any, as may be
declared from time to time by our Board of Directors out of funds
legally available therefore. No dividends may be paid on the Common
Stock until all accrued but unpaid dividends on the shares of our preferred
stock have been paid. In the event of the dissolution, liquidation or winding up
of our company, the holders of Common Stock are entitled to share ratably in all
assets remaining after payment of all liabilities of our company and the
preference amount distributable to the holders of the shares of
preferred stock. The holders of Common Stock do not have any
subscription, redemption or conversion rights, nor do they have any preemptive
or other rights to acquire or subscribe for additional, unissued or treasury
shares.
With the
exception of the number of authorized shares of Common Stock, the rights and
preferences of the shares of Common Stock prior and subsequent to the increased
authorized Common Stock will remain the same. After the effectiveness of the
Increased Authorized Common Stock Amendment, it is not anticipated that the
financial condition of the Company, the percentage ownership of management, the
number of the Company's stockholders, or any aspect of the Company's business
would materially change solely as a result of the increased number of authorized
shares of Common Stock.
The
Common Stock is currently registered under Section 12(g) of the Exchange Act,
and as a result, the Company is subject to the periodic reporting and other
requirements of the Exchange Act. The increased authorized Common Stock will not
affect the registration of the Common Stock under the Exchange Act. If the
proposed Increased Common Stock Amendment is implemented, our Common Stock will
continue to be reported on the OTC Bulletin Board under the symbol
“IRBO.”
Effects
of the Increased Common Stock Amendment
As a
result of the increased number of authorized shares of Common Stock, there will
be an increase in the total number of authorized shares of Common Stock that the
Company may issue including the number of shares of Common Stock unissued and
available for future issuance. This will increase the number of
shares of available Common Stock for issuance to raise capital for any proper
corporate purpose approved by the Board of Directors, including future financing
transactions. The issuance in the future of such additional
authorized shares may have the effect of diluting the earnings per share and
book value per share, as well as the stock ownership and voting rights, of the
currently outstanding shares of our common stock. The effective increase in the
number of authorized but unissued shares of our Common Stock may be construed as
having an anti-takeover effect by permitting the issuance of shares to
purchasers who might oppose a hostile takeover bid or oppose any efforts to
amend or repeal certain provisions of the our Certificate of Incorporation or
our Bylaws. The increased authorized Common Stock is not being
proposed in response to any effort of which management of the Company is aware
to accumulate shares of Common Stock or obtain control of the Company, nor is it
part of a similar plan by management.
Holders
of the Common Stock have no preemptive or other subscription
rights.
In
addition, the increased number of authorized shares of Common Stock will allow
additional shares of Common Stock to be reserved and available for issuance
under our Plan if Proposal No. 3 is approved by the stockholders for an
amendment to our Plan to increase the number of shares of our Common Stock
reserved and available for issuance under the Plan from 20,000,000 to
60,000,000.
Appraisal
Rights
No
appraisal rights are available under Delaware law or under the Company's
Certificate of Incorporation, as amended, or By-Laws to any stockholder who
dissents from the proposal to approve the Increased Common Stock Amendment.
There may exist other rights or actions under state law for stockholders who are
aggrieved by an increase in authorized shares generally. Although the nature and
extent of such rights or actions are uncertain and may vary depending upon the
facts or circumstances, stockholder challenges to corporate action in general
are related to the fiduciary responsibilities of corporate officers and
directors and to the fairness of corporate transactions.
Effect
on Legal Ability to Pay Dividends
The Increased Common Stock Amendment
will have no material impact on the legal ability of the Company to pay
dividends.
PROPOSAL NO. 3
APPROVAL
OF AN AMENDMENT TO OUR 2003 STOCK OPTION, DEFERRED STOCK AND RESTRICTED STOCK
PLAN (THE “PLAN”) TO INCREASE THE NUMBER OF SHARES OF OUR COMMON STOCK RESERVED
AND AVAILABLE FOR ISSUANCE UNDER THE PLAN
Note: Proposal No. 3 is conditioned upon and may
become effective only in
the event that the Increased Common Stock Amendment as
set forth in Proposal No. 2 is approved by the Company’s
stockholders. Your vote on Proposal No.
3 is subject to stockholder approval of Proposal No. 2 and your vote will have
no effect unless Proposal No. 2 is approved by the stockholders. In
the event Proposal No. 2 is not approved by the stockholders, then Proposal No.
3 cannot be made effective.
Description
of Proposed Amendment
On April
19, 2008, the Board of Directors, conditioned upon and subject to approval by
the stockholders of the Increased Common Stock Amendment as set forth in
Proposal No. 2, unanimously approved an amendment to our 2003 Stock Option,
Deferred Stock and Restricted Stock Plan, subject to stockholder approval, to
increase the number of shares of Common Stock reserved and available for
issuance under the Plan from 20,000,000 to 60,000,000 be effected upon approval
by the stockholders (the “Plan Amendment”). The full text of the
proposed Plan Amendment is set out in Appendix B to
this Proxy Statement. The text of the proposed Amendment is subject
to modification to include such changes as our Board of Directors deems
necessary and advisable to effect the increase in the number of shares of Common
Stock reserved and available for issuance under the Plan.
The
stockholders are being asked to approve the Plan Amendment.
Vote
Required and Recommendation
The
approval of the Plan Amendment to increase the number of shares of our Common
Stock reserved and available for issuance under the Plan will be made upon the
affirmative vote of the majority of shares voting on the proposal. Abstentions
and brokers non-votes will have no effect on the outcome. The Plan Amendment is conditioned
upon and subject to approval by the stockholders of the Increased Common Stock
Amendment as set forth in Proposal No. 2. In the event that Proposal
No. 2 is not approved by the stockholders, then all votes by the stockholders
in favor of Proposal No. 3 will not approve the
Plan Amendment, and the Plan Amendment will not become effective.
The
Board of Directors recommends a vote FOR the proposal to approve the amendment
to the Company's Plan to increase the number of shares of Common Stock reserved
and available for issuance under the Plan from 20,000,000 to
60,000,000.
If the
proposal is not approved by the stockholders, the Plan Amendment will not be
effective and the proposal will not be implemented.
Reasons
for the Plan Amendment
The
purpose of the Plan is to enable us to obtain and retain competent personnel who
will contribute to the Company’s success by their ability, ingenuity and
industry, and to provide incentives to such personnel and members that are
linked directly to increases in stockholder value, and will therefore, inure to
the benefit of all stockholders of the Company. Eligible recipients
of awards under the Plan include employees, directors, consultants and advisors
of the Company. Currently, awards consisting of deferred stock,
restricted stock and options to purchase shares of Common Stock and issued under
the Plan total 19,924,972 shares of Common Stock and there are only 75,028
shares of Common Stock reserved and available for issuance under the
Plan.
The Board
determined to increase the number of shares of Common Stock reserved and
available for issuance under the Plan because it believes that the current
number is insufficient for the purposes of the Plan as stated above. The market
for quality personnel is competitive, and the ability to obtain and retain
competent personnel is of great importance to our business
operations
Effects
of the Plan Amendment
As a
result of the Plan Amendment, there will be an increase in the total number of
shares of Common Stock reserved for issuance under the Plan. This
provides us with the ability to grant more awards than are currently available
under the Plan to eligible recipients including employees, directors,
consultants and advisors. The issuance in the future of awards under
the Plan consisting of deferred stock, restricted stock and options to purchase
shares of Common Stock may have the effect of diluting the earnings per share
and book value per share, as well as the stock ownership and voting rights, of
the currently outstanding shares of our Common Stock. The effective increase in
the number of authorized but unissued shares of our Common Stock which may be
issued as awards under the Plan may be construed as having an anti-takeover
effect by permitting the issuance of shares to purchasers who might oppose a
hostile takeover bid or oppose any efforts to amend or repeal certain provisions
of the our Certificate of Incorporation or our Bylaws. The increased
number of shares of Common Stock reserved and available under the Plan is not
being proposed in response to any effort of which management of the Company is
aware to accumulate shares of Common Stock or obtain control of the Company, nor
is it part of a similar plan by management.
Holders
of the Common Stock have no preemptive or other subscription
rights.
In
addition, with an increase in the number of shares of Common Stock reserved and
available for issuance under the Plan, our Board will be able to approve the
grant to one of our directors, Jerome B. Zeldis, of a nonstatutory option to
purchase 750,000 shares of Common Stock pursuant to provisions of Dr. Zeldis’
directorship agreement entered into with the Company on November 1,
2007. The exercise price of such options will be equal to 85% of the
fair market value of the Common Stock on the day of the grant with a term of ten
years. If the nonstatutory option to Dr. Zeldis was granted today,
the theoretical value of the option would be $48,066.
Appraisal
Rights
No
appraisal rights are available under Delaware law or under the Company's
Certificate of Incorporation, as amended, or By-Laws to any stockholder who
dissents from the proposal to approve the Plan Amendment. There may exist other
rights or actions under state law for stockholders who are aggrieved by an
increase in authorized shares generally. Although the nature and extent of such
rights or actions are uncertain and may vary depending upon the facts or
circumstances, stockholder challenges to corporate action in general are related
to the fiduciary responsibilities of corporate officers and directors and to the
fairness of corporate transactions.
Effect
on Legal Ability to Pay Dividends
The Plan
Amendment will have no material impact on the legal ability of the Company to
pay dividends.
Effect
of Proposal No. 4
In the
event that the Reverse Split Amendment under Proposal No. 4 is approved,
proportionate adjustments will be made to the per-share exercise price and the
number of shares issuable upon the exercise of all outstanding options,
restricted stock awards and restricted stock units entitling the holders to
purchase shares of Common Stock as set forth under provisions of the Plan, which
will result in approximately the same aggregate price being required to be paid
for such options and restricted stock units upon exercise immediately preceding
the reverse stock split.
PROPOSAL NO. 4
APPROVAL
TO AMEND THE CERTIFICATE OF INCORPORATION, AS AMENDED, TO PROVIDE FOR A
RECAPITALIZATION IN WHICH THE ISSUED AND OUTSTANDING SHARES OF OUR COMMON STOCK
ARE TO BE REVERSE SPLIT AT A RATIO OF ONE-FOR-TEN AT ANY TIME PRIOR TO MARCH 31,
2009, IF AT ALL, WITH THE TIMING THEREOF TO BE DETERMINED BY THE BOARD OF
DIRECTORS IN ITS SOLE DISCRETION AND TO DECREASE THE NUMBER OF AUTHORIZED SHARES
OF OUR COMMON STOCK TO 100,000,000.
Note:
Proposal No. 4 is not conditioned upon and may become effective independent of
the Increased Common Stock Amendment as set forth in Proposal No.
2. However, in the event that Proposal No. 2 is approved by the
stockholders, the Increased Common Stock Amendment will be filed with
the Delaware Secretary of State prior to the filing, if at all, of the Reverse
Split Amendment.
General
The Board
of Directors has approved and is hereby soliciting Stockholder approval of an
amendment to the Company’s Certificate of Incorporation, as amended (the
“Reverse Split Amendment”), to provide for a recapitalization in which the
issued and outstanding shares of our Common Stock are to be reverse split at a
ratio of one-for-ten prior to March 31, 2009, if at all, with the timing thereof
to be determined by our Board of Directors in its sole discretion and to
decrease the number of our authorized shares of Common Stock to 100,000,000. The
full text of the proposed Reverse Split Amendment is set out in Appendix C to
this Proxy Statement. A vote FOR Proposal No. 4 will constitute
approval of the Reverse Split Amendment providing for the conversion of each ten
(10) shares of Common Stock into one (1) share of Common Stock and will grant
the Board of Directors the authority to select the timing (no later than March
31, 2009) of when the Reverse Split Amendment is to become effective, if at
all. This means that the number of shares of our Common Stock that
you hold after the reverse split will be one-tenth (1/10) of the number of
shares held prior to the reverse split. If the Stockholders approve
this proposal, the Board of Directors will have the authority, but not the
obligation, in its sole discretion, and without further action on the part of
the Stockholders, to effect the approved reverse stock split by filing the
Reverse Split Amendment with the Delaware Secretary of State at any time after
the approval of the Reverse Split Amendment and prior to March 31,
2009. Following approval of the Reverse Split Amendment, the
Board of Directors will have the authority to decide, in its sole discretion,
whether or not to file the Reverse Split Amendment with the Delaware Secretary
of State and make it effective. If the Amendment has not been filed
with the Delaware Secretary of State by the close of business on March 31, 2009,
the Board of Directors will abandon the Reverse Split Amendment constituting the
reverse stock split and the decrease in the number of authorized shares of our
Common Stock. The Board of Directors may determine, in its sole discretion, not
to file the Reverse Split Amendment and to abandon the reverse stock split
without further action by our Stockholders.
Upon
approval of the Reverse Split Amendment under Proposal No. 4, the number of
authorized shares of the Company’s Common Stock will be reduced from 250,000,000
to 100,000,000, if Proposal No. 2 is not approved by the stockholders, and from
450,000,000 to 100,000,000 if Proposal No. 2 is approved by the stockholders and
the Increased Common Stock Amendment is filed with the Delaware Secretary of
State, but would not change the par value of a share of the Company’s Common
Stock. Except for any changes as a result of the treatment of fractional shares,
each Stockholder will hold the same percentage of Common Stock outstanding
immediately after the reverse stock split as such Stockholder held immediately
prior to the reverse stock split. The Reverse Split
Amendment does not include a change in the number of authorized shares of
Preferred Stock.
Background
The Board
of Directors believes that the reverse stock split is in the best interests of
the Company by reducing the number of shares of Common Stock available on the
public market, and thereby proportionately increasing the per share price of the
Company’s Common Stock. Theoretically, decreasing the number of
shares of Common Stock outstanding should not, by itself, affect the
marketability of the shares, the type of investor who would be interested in
acquiring them, or our reputation in the financial community. In
practice, many investors and market makers consider low-priced stocks as unduly
speculative in nature and, as a matter of policy, avoid investment and trading
in such stocks. The presence of these negative perceptions may be adversely
affecting, and may continue to adversely affect, not only the pricing of our
Common Stock, but also its trading liquidity. In addition, these perceptions may
affect our ability to raise additional capital through the sale of stock or the
cost of debt we may incur. Upon approval of and filing of the Reverse Split
Amendment with the Delaware Secretary of State, we will have 11,601,754 shares
of our Common Stock outstanding as of the date of this proxy
statement. With the decrease in the number of authorized shares of
our Common Stock to 100,000,000, the reverse split will also make available a
substantial number of additional authorized, but unissued shares of Common Stock
which we believe will provide increased flexibility in structuring possible
future financing, in taking advantage of future business opportunities such as
acquisitions, and in meeting corporate needs as they arise, all without the
delay and expense of calling a meeting of our Stockholders to authorize an
increase in authorized capital. The Company’s Common Stock may then
be more appealing to institutional investors and institutional
funds.
We hope
that the decrease in the number of shares outstanding of our Common Stock
resulting from the reverse split, and the anticipated increase in the price per
share, will encourage greater interest in our Common Stock among members of the
financial community. However, the possibility exists that Stockholder liquidity
may be adversely affected by the reduced number of shares which would be
outstanding if the reverse split is effected, particularly if the price per
share of the Common Stock begins a declining trend after the reverse split is
effected. Such a decrease in the price per share of the Common Stock
will reduce the value of your holdings in the Company as you will have fewer
shares as a result of the reverse split.
The Board
of Directors believes that the share price of our Common Stock is a factor in
whether our Common Stock meets investing guidelines for certain institutional
investors and investment funds. Also, the Board of Directors believes that our
Stockholders will benefit from relatively lower trading costs for a higher
priced stock. The combination of lower transaction costs and increased interest
from institutional investors and investment funds may ultimately improve the
trading liquidity of our Common Stock.
We are
not aware of any present efforts by anyone to accumulate the Common Stock, and
the proposed reverse split is not intended to be an anti-takeover device. The
Board of Directors did not seek authority to implement a reverse stock split in
anticipation of any future transaction or series of transactions, including any
"going private" transaction.
Currently,
our Common Stock is listed on the FINRA OTC Bulletin Board under the symbol
“IRBO”. The OTC Bulletin Board has several continued listing criteria that
companies must satisfy in order to remain listed on the exchange. Currently, the
Company meets all of the OTC Bulletin Board’s continued listing
criteria. The OTC Bulletin Board is viewed by most investors as a
less desirable and less liquid marketplace. A reverse stock split may give the
Company the opportunity to attempt a listing on a higher quality exchange, but
there can be no assurance that the reverse split will help the Company achieve
this desired result.
If the
Stockholders approve Proposal No. 4, the reserve stock split will be effected,
if at all, only upon a determination by the Board that the reverse stock split
is in the Company’s and the Stockholders’ best interests at that time. In
connection with any determination to effect the reverse stock split, the Board,
with the advice of its experts, will set the time for such a reverse split up to
March 31, 2009. If the Board of Directors does not implement the
reverse stock split prior to March 31, 2009 the authority granted to the Board
of Directors to implement the reverse stock split on these terms will
terminate. This determination will be made by the Board with the
intention to create the greatest marketability for the Company’s Common Stock
based upon prevailing market conditions at that time.
There can
be no assurance that the reverse split will achieve any of the desired results.
There also can be no assurance that the price per share of the Common Stock
immediately after the reverse split will increase proportionately with the
reverse split, or that any increase will be sustained for any period of time. A
decrease in the price per share of the Common Stock will reduce the value of
your holdings in the Company as you will have fewer shares as a result of the
reverse split.
The Board
reserves its right to elect not to proceed, and abandon, the reverse stock split
if it determines, in its sole discretion, that this proposal is no longer in the
best interests of the Company’s stockholders.
Purpose
of the Reverse Stock Split
The
purpose of the reverse stock split is to increase the per share trading price of
the Company’s Common Stock. The Board intends to effect the proposed reverse
stock split only if it believes that a decrease in the number of shares
outstanding is likely to improve the trading price for the Company’s Common
Stock, and only if the implementation of a reverse stock split is determined by
the Board to be in the best interest of the Company and its stockholders. The
Board may exercise its discretion not to implement a reverse stock
split.
The
Company believes that a number of institutional investors and investment funds
are reluctant to invest, and in some cases may be prohibited from investing, in
lower-priced stocks and that brokerage firms are reluctant to recommend
lower-priced stocks to their clients. By effecting a reverse stock split, the
Company believes it may be able to raise its Common Stock price to a level where
the Company’s Common Stock could be viewed more favorably by potential
investors.
Other
investors may also be dissuaded from purchasing lower-priced stocks because the
brokerage commissions, as a percentage of the total transaction, tend to be
higher for lower-priced stocks. A higher stock price after a reverse stock split
could alleviate this concern.
The
combination of lower transaction costs and increased interest from institutional
investors and investment funds could have the effect of improving the trading
liquidity of the Company’s Common Stock.
Certain
Risk Factors Associated with the Reverse Stock Split
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While
the Board of Directors believes that a higher stock price may help
generate investor interest, there can be no assurance that the reverse
stock split will result in any particular price for the Company’s Common
Stock or result in a per-share price that will attract institutional
investors or investment funds or that such share price will satisfy the
investing guidelines of institutional investors or investment funds. As a
result, the trading liquidity of the Company’s Common Stock may not
necessarily improve.
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There
can be no assurance that the market price per new share of the Company’s
Common Stock after a reverse stock split will remain unchanged or increase
in proportion to the reduction in the number of shares of the Company’s
Common Stock outstanding before the reverse stock split. For example,
based on the closing price of the Company’s Common Stock on April 25, 2008
of $0.09 per share, if the reverse stock split was implemented and
approved for a reverse stock split ratio of 1-for-10, there can be no
assurance that the post-split market price of the Company’s Common Stock
would be $0.90 or greater. Accordingly, the total market
capitalization of the Company’s Common Stock, and the value of your
holdings of our Common Stock, after the reverse stock split may be lower
than the total market capitalization before the reverse stock split.
Moreover, in the future, the market price of the Company’s Common Stock
following the reverse stock split may not exceed or remain higher than the
market price prior to the reverse stock
split.
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If
the reverse stock split is effected and the market price of the Company’s
Common Stock declines, the percentage decline may be greater than would
occur in the absence of a reverse stock split. The value of your holdings
of our Common Stock would also decline in the same manner. The
market price of the Company’s Common Stock will, however, also be based on
performance and other factors, which are unrelated to the number of shares
outstanding. Furthermore, the liquidity of the Company’s Common Stock
could be adversely affected by the reduced number of shares that would be
outstanding after the reverse stock
split.
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Impact
of the Proposed Reverse Stock Split if Implemented
If
approved and effected, the reverse stock split will be realized simultaneously
and in the same ratio for all of the Company’s Common Stock. The reverse stock
split will affect all issued and outstanding shares of the Company’s Common
Stock and outstanding rights to acquire the Company’s Common Stock uniformly. It
will not affect any Stockholder’s percentage ownership interest in the Company,
except to the extent that the reverse stock split would result in any holder of
the Company’s Common Stock receiving whole shares instead of fractional shares.
As described below, holders of the Company’s Common Stock otherwise entitled to
fractional shares as a result of the reverse stock split will receive whole
shares in lieu of such fractional shares. In addition, the reverse stock split
will not affect any Stockholder’s proportionate voting power (subject to the
treatment of fractional shares). After the reverse stock split, the number of
authorized shares of Common Stock will be 100,000,000 shares and the number of
unissued shares of Common Stock will be approximately 88,398,246 shares.
Although the Company does not have any current plans, proposals or arrangements
(written or otherwise) to issue any additional shares other than pursuant to
equity plans and the potential conversion of secured convertible notes currently
in existence and previously publicly announced transactions, the decrease in the
number of authorized shares of our Common Stock will nevertheless make available
a sufficient number of additional authorized but unissued shares of Common Stock
for structuring possible future financings, in taking advantage of future
business opportunities such as acquisitions and in needing corporate needs as
they arise.
The
principal effects of the reverse stock split will be that:
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Each
10 shares of the Company’s Common Stock owned by a Stockholder will be
combined into one new share of Common
Stock;
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the
number of shares of Common Stock issued and outstanding will be reduced
from approximately 116,017,539 shares to approximately 11,601,754
shares;
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based
upon the reverse stock split, proportionate adjustments will be made to
the per-share exercise price and the number of shares issuable upon the
exercise of all outstanding options, restricted stock awards and
restricted stock units entitling the holders to purchase shares of Common
Stock as set forth under provisions of our 2003 Stock Option, Deferred
Stock and Restricted Stock Plan, which will result in approximately the
same aggregate price being required to be paid for such options and
restricted stock units upon exercise immediately preceding the reverse
stock split;
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the
number of shares reserved for issuance under the Company’s 2003 Stock
Option, Deferred Stock and Restricted Stock Plan will be reduced
proportionately based upon the reverse stock split ratio selected by the
Board of Directors; and,
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based
upon the reverse stock split, proportionate adjustments will be made to
the per-share exercise price and the number of shares issuable upon the
exercise of all outstanding warrants to purchase shares of our Common
Stock, which will result in approximately the same aggregate price being
required to be paid for shares of our Common Stock upon exercise of such
warrants immediately preceding the reverse stock
split.
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In
addition, if approved and implemented, the reverse stock split may result in
some Stockholders owning “odd lots” of less than 100 shares of Common Stock. Odd
lot shares may be more difficult to sell, and 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. The Board
believes, however, that these potential effects are substantially outweighed by
the benefits of the reverse stock split.
The
Company will continue to have 10,000,000 authorized shares of Preferred Stock of
which no shares are issued or outstanding. Authorized but unissued
shares will be available for issuance, and we may issue such shares in the
future. The exercise of stock options and warrants that have been granted or may
be granted in the future will increase the number of issued and outstanding
shares of our Common Stock. In addition, if we were to issue any additional
shares in connection with any future financing, acquisition or other type of
transaction, the ownership interest of holders of our Common Stock will be
diluted.
Effective
Date
The
proposed reverse stock split of the Common Stock would become effective as of
11:59 p.m., Eastern Time, (the “Effective Date”) on the date of filing the
Reverse Split Amendment with the office of the Delaware Secretary of State.
Except as explained below with respect to fractional shares, on the Effective
Date, each ten (10) shares of the Company’s Common Stock issued and outstanding
immediately prior thereto will be converted, automatically and without any
action on the part of the stockholders, into one (1) share of the Company’s
Common Stock.
After the
Effective Date, the Company’s Common Stock will have new committee on uniform
securities identification procedures (“CUSIP”) numbers, which is a number used
to identify the Company’s equity securities, and stock certificates with the
older CUSIP numbers will need to be exchanged for stock certificates with the
new CUSIP numbers by following the procedures described below.
After the
Effective Date, the Company will continue to be subject to periodic reporting
and other requirements of the Securities Exchange Act of 1934, as amended. The
Company’s Common Stock will continue to be reported on the FINRA OTC Bulletin
Board under the symbol “IRBO”, although FINRA will add the letter “D” to the end
of the trading symbol for a period of 20 trading days after the Effective Date
to indicate that the reverse stock split has occurred.
Board
Discretion to Implement the Reverse Stock Split
If the
reverse stock split is approved by the Company’s Stockholders, it will be
effected, if at all, only upon a determination by the Board of Directors that a
reverse stock split is in the best interests of the Company and the
stockholders. The Board’s determination as to whether the reverse stock split
will be effected will be based upon certain factors, including existing and
expected marketability and liquidity of the Company’s Common Stock, prevailing
market conditions and the likely effect on the market price of the Company’s
Common Stock. If the Board determines to effect the reverse stock split, the
Board, along with its experts, will consider various factors in selecting the
ratio including the overall market conditions at the time and the recent trading
history of the Common Stock. The Board of Directors is not required to implement
the reverse stock split. If the Board of Directors does not implement
the reverse stock split prior to March 31, 2009 the authority granted to the
Board of Directors to implement the reverse stock split on these terms will
terminate.
Fractional
Shares
Stockholders
will not receive fractional shares of Common Stock from the conversion of the
one-for-ten ratio following the reverse stock split. Instead, stockholders will
receive a full share of Common Stock for any fractional share interests created
by the reverse split.
Effect
on Registered and Beneficial Holders of Common Stock
Upon the
reverse stock split, the Company intends to treat shares held by stockholders in
“street name,” through a bank, broker or other nominee, in the same manner as
registered stockholders whose shares are registered in their names. Banks,
brokers or other nominees will be instructed to effect the reverse stock split
for their beneficial holders holding the Company’s Common Stock in “street
name”.
Effect
on Registered “Book-Entry” Holders of Common Stock
Certain
of the Company’s registered holders of Common Stock may hold some or all of
their shares electronically in book-entry form with the Company’s transfer
agent. These stockholders do not have stock certificates evidencing their
ownership of the Company’s Common Stock. They are, however, provided with a
statement reflecting the number of shares registered in their
accounts.
If a
Stockholder holds registered shares in book-entry form with the transfer agent,
no action needs to be taken to receive post-reverse stock split
shares. If a stockholder is entitled to post-reverse stock split
shares, a transaction statement will automatically be sent to the stockholder’s
address of record indicating the number of shares of Common Stock held following
the reverse stock split.
Effect
on Certificated Shares
Stockholders
holding shares of the Company’s Common Stock in certificate form will be sent a
transmittal letter by Stalt, Inc., our transfer agent, as soon as practicable
after the Effective Date of the Reverse Split Amendment. The letter
of transmittal will contain instructions on how a stockholder should surrender
his or her certificate(s) representing shares of the Company’s Common Stock
(“Old Certificates”) to the transfer agent in exchange for certificates
representing the appropriate number of whole shares of Common Stock following
the reverse split (“New Certificates”). No New Certificates will be issued to a
stockholder until such stockholder has surrendered all Old Certificates,
together with a properly completed and executed letter of transmittal, to the
transfer agent. No Stockholder will be required to pay a transfer or other fee
to exchange his, her or its certificates.
Stockholders
will then receive a New Certificate(s) representing the number of whole shares
of Common Stock to which they are entitled as a result of the reverse stock
split. Until surrendered, the Company will deem outstanding Old Certificates
held by stockholders to be canceled and only to represented the number of whole
shares of Common Stock to which these Stockholders are entitled following the
reverse stock split.
Any Old
Certificates submitted for exchange, whether because of a sale, transfer or
other disposition of stock, will automatically be exchanged for New
Certificates.
If an Old
Certificate has a restrictive legend on the back of the Old Certificate(s), the
New Certificate will be issued with the same restrictive legends that are on the
back of the Old Certificate(s).
STOCKHOLDERS
SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND SHOULD NOT SUBMIT ANY STOCK
CERTIFICATE(S) UNTIL REQUESTED TO DO SO.
Accounting
Matters
The
reverse stock split will not affect the par value of a share of the Company’s
Common Stock. As a result, as of the Effective Date of the reverse stock split,
the stated capital attributable to Common Stock on the Company’s balance sheet
will be reduced proportionately based on the reverse stock split ratio
(including a retroactive adjustment of prior periods), and the additional
paid-in capital account will be credited with the amount by which the stated
capital is reduced. Reported per-share net income or loss and net book value of
the Company’s Common Stock will be restated because there will be fewer shares
of Common Stock outstanding.
Potential
Anti-Takeover Effect
The
proportion of unissued authorized shares to issued shares could, under certain
circumstances, have an anti-takeover effect. For example, the issuance of a
large block of Common Stock could dilute the stock ownership of a person seeking
to effect a change in the composition of the Board of Directors or contemplating
a tender offer or other transaction for the combination of the Company with
another company. However, the reverse stock split proposal is not being proposed
in response to any effort of which the Company is aware to accumulate shares of
Common stock or obtain control of the Company, nor is it part of a plan by
management to recommend to the Board and stockholders a series of amendments to
the Company’s Certificate of Incorporation, as amended. Other than the proposal
for the Reverse Stock Amendment and the Increased Common Stock Amendment set
forth in Proposal No. 2 above, the Board of Directors does not currently
contemplate recommending the adoption of any other amendments to the Company’s
Certificate of Incorporation, as amended, that could be construed to reduce or
interfere with the ability of third parties to take over or change the control
of the Company.
Reasons
for the Decrease in the Number of Authorized Shares of Our Common
Stock
We
currently have 250,000,000 shares of Common Stock authorized for issuance. In
the event that Proposal No. 2 is approved by the shareholders, the authorized
number of shares of our Common Stock will be increased to
450,000,000. In the event that Proposal No. 4 is approved by the
shareholders effecting a one-for-ten reverse stock split the number of
outstanding shares of our Common Stock will be 11,601,754. As such,
we do not believe that it is in the best interests of the Company to maintain
the authorized number of shares of our Common Stock at 250,000,000 or
450,000,000 and therefore the Reverse Split Amendment includes a decrease in the
number of authorized shares of our Common Stock to 100,000,000. This decrease
would become effective upon filing the proposed Reverse Split Amendment with the
Secretary of State of the State of Delaware.
The Board
has determined that with approval of the reverse split of our Common Stock a
decrease in the number of authorized shares of our Common Stock will be
sufficient for existing and future corporate purposes, and allow flexibility for
issuances of Common Stock to raise additional capital, for strategic business
opportunities that may be presented from time to time and to allow additional
shares of Common Stock to be reserved and available for issuance under our 2003
Stock Option, Deferred Stock and Restricted Stock Plan. The decrease
in the number of authorized shares of our Common Stock from filing of the
Reverse Split Amendment, if approved by the stockholders, will not change the
number of outstanding shares of Common Stock but will provide the Board with the
ability to issue sufficient additional shares of Common Stock as it determines
to be for proper corporate purposes and in the best interests of the
Company.
With the
exception of the number of authorized shares of Common Stock, the rights and
preferences of the shares of Common Stock prior and subsequent to the decrease
in the number of authorized shares of Common Stock will remain the same. After
the effectiveness of the Reverse Split Amendment, it is not anticipated that the
financial condition of the Company, the percentage ownership of management, the
number of the Company's stockholders, or any aspect of the Company's business
would materially change solely as a result of the decreased number of authorized
shares of Common Stock.
The
Common Stock is currently registered under Section 12(g) of the Exchange Act,
and as a result, the Company is subject to the periodic reporting and other
requirements of the Exchange Act. The decreased number of authorized shares of
our Common Stock will not affect the registration of the Common Stock under the
Exchange Act. If the proposed Reverse Split Amendment is implemented, our
Common Stock will continue to be reported on the OTC Bulletin Board under the
symbol “IRBO.”
Effects
of the Decrease in the Number of Authorized Shares of Common Stock
As a
result of the decreased number of authorized shares of Common Stock, there will
be a decrease in the total number of authorized shares of Common Stock that the
Company may issue including the number of shares of Common Stock unissued and
available for future issuance. This will decrease the number of
shares of available Common Stock for issuance to raise capital for any proper
corporate purpose approved by the Board of Directors, including future financing
transactions as compared to what would be available upon approval of Proposal
No. 2 for the Increased Common Stock Amendment. Currently, we have
24,472,796 shares of Common Stock available for issuance prior to approval of
Proposal No. 2 or Proposal No. 4. Because of the reverse split which
will be effected upon approval of the Reverse Split Amendment under Proposal No.
4, there will be additional authorized shares of Common Stock available for
issuance compared to what is currently available even with the decrease in the
number of authorized shares of which may have the effect of diluting the
earnings per share and book value per share, as well as the stock ownership and
voting rights, of the currently outstanding shares of our Common Stock. The
effective of this may be construed as having an anti-takeover effect by
permitting the issuance of shares to purchasers who might oppose a hostile
takeover bid or oppose any efforts to amend or repeal certain provisions of our
Certificate of Incorporation or our Bylaws. The increased authorized
Common Stock is not being proposed in response to any effort of which management
of the Company is aware to accumulate shares of Common Stock or obtain control
of the Company, nor is it part of a similar plan by management.
Holders
of the Common Stock have no preemptive or other subscription
rights.
Shares
of Common Stock Issued and Outstanding
The
Company is currently authorized to issue a maximum of 250,000,000 shares of
Common Stock. As of the Record Date of April 28, 2008, there were approximately
116,017,539 shares of Common Stock issued and outstanding. As of that
date, an additional 58,739,637 shares of Common Stock were issuable upon
exercise of outstanding stock options and warrants, an additional 75,028 shares
were reserved under our stock option plans for future grants of options,
50,695,000 shares are reserved per outstanding contracts and convertible debt
obligations. The Increased Common Stock Amendment will not change the
number of outstanding shares of Common Stock but will provide the Board with the
ability to issue additional shares of Common Stock as it determines to be for
proper corporate purposes and in the best interests of the Company.
The
holders of our Common Stock are entitled to one vote per share on all matters
submitted to a vote of our stockholders. In addition, such
holders are entitled to receive ratably such dividends, if any, as may be
declared from time to time by our Board of Directors out of funds
legally available therefore. No dividends may be paid on the Common
Stock until all accrued but unpaid dividends on the shares of our preferred
stock have been paid. In the event of the dissolution, liquidation or winding up
of our company, the holders of Common Stock are entitled to share ratably in all
assets remaining after payment of all liabilities of our company and the
preference amount distributable to the holders of the shares of
preferred stock. The holders of Common Stock do not have any
subscription, redemption or conversion rights, nor do they have any preemptive
or other rights to acquire or subscribe for additional, unissued or treasury
shares.
With the
exception of the number of authorized shares of Common Stock, the rights and
preferences of the shares of Common Stock prior and subsequent to the increased
authorized Common Stock will remain the same. After the effectiveness of the
Increased Authorized Common Stock Amendment, it is not anticipated that the
financial condition of the Company, the percentage ownership of management, the
number of the Company's stockholders, or any aspect of the Company's business
would materially change solely as a result of the increased number of authorized
shares of Common Stock.
The
Common Stock is currently registered under Section 12(g) of the Exchange Act,
and as a result, the Company is subject to the periodic reporting and other
requirements of the Exchange Act. The increased authorized Common Stock will not
affect the registration of the Common Stock under the Exchange Act. If the
proposed Increased Common Stock Amendment is implemented, our Common Stock will
continue to be reported on the OTC Bulletin Board under the symbol
“IRBO.”
No
Appraisal Rights
The
Company’s stockholders are not entitled to appraisal rights under the Delaware
General Corporation Law, the Company's Certificate of Incorporation, as amended,
or Bylaws with regard to the proposed Reverse Stock Amendment, and the Company
will not independently provide stockholders with any such right. There may exist
other rights or actions under state law for stockholders who are aggrieved by an
increase in authorized shares generally. Although the nature and extent of such
rights or actions are uncertain and may vary depending upon the facts or
circumstances, stockholder challenges to corporate action in general are related
to the fiduciary responsibilities of corporate officers and directors and to the
fairness of corporate transactions.
Effect on Legal Ability to Pay
Dividends
The
Increased Common Stock Amendment will have no material impact on the legal
ability of the Company to pay dividends.
United
States Federal Income Tax Consequences Of The Reverse Stock Split
The
following is summary of certain material United Stated federal income tax
consequences of the reverse stock split and does not purport to be a complete
discussion of all of the possible federal income tax consequences of the reverse
stock split. This summary is included for general information only. Further, it
does not address any state, local or foreign income or other tax consequences.
Also, it does not address the tax consequences to holders that are subject to
special tax rules, such as banks, insurance companies, regulated investment
companies, personal holding companies, foreign entities, nonresident alien
individuals, broker-dealers and tax-exempt entities. The discussion is based on
the provision of the United States federal income tax law as of the date hereof,
which is subject to change retroactively as well as prospectively. This summary
also assumes that the pre-reverse stock split shares were, and the post-reverse
stock split shares will be, held as a “capital asset,” as defined in the
Internal Revenue Code of 1986, as amended (i.e., generally, property held for
investment). The tax treatment of a stockholder may vary depending upon the
particular facts and circumstances of such stockholder. Each stockholder is
urged to consult with such stockholders own tax advisor with respect to the tax
consequences of the Reverse Stock Amendment. As used herein, the term United
States holder means a stockholder that is, for federal income tax purposes: a
citizen or resident of the United States; a corporation or other entity taxed as
a corporation created or organized in or under the laws of the United States,
any state of the United States or the District of Columbia; an estate the income
of which is subject to federal income tax regardless of its source; or a trust
if a U.S. court is able to exercise primary supervision over the administration
of the trust and one or more U.S. persons have the authority to control all
substantial decision of the trust.
Other
than receiving whole shares for fractional shares discussed above, no gain or
loss should be recognized by a stockholder upon such stockholder’s exchange of
pre-reverse stock split shares for post-reverse stock split shares pursuant to
the reverse stock split.
In the
reverse stock split (including any fraction of a post-reverse stock split share
deemed to have been received), the tax basis will be the same as the
stockholder’s aggregate tax basis in the pre-reverse stock split shares
exchanged therefore. The stockholder’s holding period for the
post-reverse stock split shares will include the period during which the
stockholder held the pre-reverse stock split shares surrendered in the reverse
stock split.
The
Company’s view regarding the tax consequences of the reverse stock split is not
binding on the Internal Revenue Service or the courts. Accordingly, each
stockholder should consult with his or her own tax advisor with respect to all
of the potential tax consequences to him or her of the reverse stock
split.
TO
ENSURE COMPLIANCE WITH TREASURY DEPARTMENT CIRCULAR 230, STOCKHOLDERS ARE HEREBY
NOTIFIED THAT: (A) ANY DISCUSSION OF FEDERAL TAX ISSUES IN THIS PROXY STATEMENT
IS NOT INTENDED OR WRITTEN TO BE RELIED UPON, AND CANNOT BE RELIED UPON BY
STOCKHOLDERS FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON
STOCKHOLDERS UNDER THE INTERNAL REVENUE CODE; (B) SUCH DISCUSSION IS INCLUDED
HEREIN BY THE COMPANY IN CONNECTION WITH THE PROMOTION OR MARKETING (WITHIN THE
MEANING OF CIRCULAR 230) BY THE COMPANY OF THE TRANSACTIONS OR MATTERS ADDRESSED
HEREIN; AND (C) STOCKHOLDERS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR
CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.
Canadian
Federal Income Tax Considerations of the Reverse Stock Split
The
following summary describes the principal Canadian federal income tax
considerations under the Income Tax Act (Canada) (the “Tax Act”) generally
applicable to stockholders whose shares are consolidated pursuant to the reverse
stock split and who, for purposes of the Tax Act, are resident in Canada, hold
their shares as capital property and deal at arm’s length and are not affiliated
with the Company.
This
summary is based on the current provisions of the Tax Act, the regulations
thereunder (the “Regulations”), and counsel’s understanding of the current
published administrative and assessing practices of the Canada Revenue Agency
and takes into account all specific proposals to amend the Tax Act and the
Regulations publicly announced by the Minister of Finance (Canada) prior to the
date hereof. This summary does not take into account or anticipate any other
changes in law or administrative practices, whether by judicial, governmental or
legislative action or decision, nor does it take into account provincial,
territorial or foreign income tax legislation or considerations.
This
summary is of a general nature only and is not intended to be, and should not be
construed to be, legal or tax advice to any particular stockholder. Stockholders
should consult their own tax advisors as to the tax consequences in their
particular circumstances.
A
stockholder will not realize a capital gain or a capital loss as a result of
implementation of the Reverse Stock Amendment.
THE
BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE PROPOSAL TO AMEND THE AMENDED
CERTIFICATE OF INCORPORATION, AS AMENDED, TO EFFECT A REVERSE STOCK SPLIT AT A
RATIO OF ONE-FOR-TEN AT ANY TIME PRIOR TO MARCH 31, 2009, IF AT ALL, WITH THE
TIMING THEREOF TO BE DETERMINED BY THE BOARD
OF DIRECTORS, IN ITS SOLE DISCRETION, AND THE DECREASE IN THE NUMBER OF OUR
AUTHORIZED SHARES OF COMMON STOCK.
PROPOSAL NO. 5
RATIFICATION
OF THE APPOINTMENT OF RBSM
LLP
AS
INDEPENDENT OUTSIDE ACCOUNTANT
The
Company's Stockholders are being asked to ratify the appointment of RBSM LLP as
our independent outside accountant.
Required Vote
The
ratification of the appointment of RBSM LLP as our independent outside
accountant will be adopted upon the affirmative vote of the majority of shares
voting on the proposal. Abstentions and brokers non-votes will have no effect on
the outcome.
The
Board of Directors recommends a vote FOR the ratification of the appointment of
RBSM LLP as our independent outside accountants for the year ending
December 31, 2008.
RBSM LLP
was selected by the Board as our principal independent public accounting firm
beginning in April 2004 and has conducted our audit for the years ending
December 31, 2004, 2005, 2006 and 2007. We are asking Stockholders to ratify the
appointment of RBSM LLP to conduct the audit for the year ending December 31,
2008. A representative of RBSM LLP will attend the annual meeting
telephonically, have an opportunity to make a statement and be available to
answer questions.
The
following table sets forth fees billed to us by RBSM during the fiscal years
ended December 31, 2007 and December 31, 2006 for: (i) services rendered for the
audit of our annual financial statements and the review of our quarterly
financial statements, (ii) services by our auditor that are reasonably related
to the performance of the audit or review of our financial statements and that
are not reported as Audit Fees, (iii) services rendered in connection with tax
compliance, tax advice and tax planning, and (iv) all other fees for services
rendered.
|
December
31, 2007
|
December
31,2006
|
||||||||
|
(i)
|
Audit
Fees
|
$
|
68,050
|
$
|
58,856
|
||||
|
(ii)
|
Audit
Related Fees
|
-
|
-
|
||||||
|
(iii)
|
Tax
Fees
|
-
|
-
|
||||||
|
(iv)
|
All
Other Fees
|
3,300
|
4,795
|
||||||
|
Total
Fees
|
$
|
71,350
|
$
|
63,651
|
|||||
AUDIT FEES. Consists of fees
billed for professional services rendered for the audit of the Company's
consolidated financial statements and review of the interim consolidated
financial statements included in quarterly reports and services that are
normally provided by the Company's certifying accountant in connection with
statutory and regulatory filings or engagements.
TAX FEES. Consists of all
services performed by the independent auditor’s tax personnel, except those
related to the audit of financial statements, and include tax compliance, tax
consulting, tax planning and non-recurring projects.
ALL OTHER FEES. Consists of
fees billed for professional services performed by the independent auditors
related to the review of and consent to the Company’s SB-2 registration
statement, and exhibits thereto.
Our Board
has considered whether the provision of these services is compatible with
maintaining RBSM LLP’s independence and has concluded that it is
compatible.
AMENDED AND RESTATED BYLAWS
Since the
completion of the statutory merger in July 2003, our Bylaws have not been
amended. Our Board has determined that it is in the best interest of
the Company to update our Bylaws to current Delaware law, to update who can call
a special meeting of the stockholders, to update provisions regarding the number
and term of office of directors and the process of filling vacancies on the
Board, to update provisions regarding the issuance of shares, share certificates
and matters related to the transfer of shares, and other minor stylistic,
definitional and clarifying drafting alterations.
The Board
of Directors has approved the Amended and Restated Bylaws as permitted under
provisions of the Bylaws and no stockholder approval is needed for amending the
Bylaws. All that is required is that notice of the amended Bylaws is
given in the notice of the meeting of stockholders. Therefore, a copy
of the entire text of the Amended and Restated Bylaws, which sets forth the
amendments discussed above is attached as Appendix D. The above
description of the amendments to the Amended and Restated Bylaws are a summary
only and you should read the Amended and Restated Bylaws that are attached in
their entirety.
The Amended and Restated Bylaws have
been approved by our Board of Directors and no vote of the stockholders is
required for approval.
SECTION
16(a) BENEFICIAL OWNERSHIP
REPORTING
COMPLIANCE
Section
16(a) of the Securities Exchange Act of 1934 requires our executive officers and
directors, and persons who own more than ten percent of a registered class of
our equity securities to file reports of ownership and changes in ownership with
the Securities and Exchange Commission. Executive officers, directors and
greater than 10% Stockholders are required by SEC regulation to furnish us with
copies of all Section 16(a) forms they file. Based solely on its review of the
copies of such forms received by us during the year ended December 31, 2007, we
believe that, during such year none of our executive officers, directors, and
ten percent Stockholders have complied with such filing
requirements.
SHAREHOLDER PROPOSALS
Proposals
to be Included in Proxy Statement
Shareholders
are hereby notified that if they wish a proposal to be included in our proxy
statement and form of proxy relating to the 2009 Annual Meeting of Shareholders,
they must deliver a written copy of their proposal a reasonable time before the
Company begins to print and mail its proxy materials for the meeting. Proposals
must comply with the proxy rules relating to stockholder proposals, in
particular Rule 14a-8 under the Securities Exchange Act of 1934, in order to be
included in our proxy materials.
Proposals
to be Submitted for Annual Meeting
Shareholders
who wish to submit a proposal for consideration at our 2009 annual meeting of
Stockholders, but who do not wish to submit the proposal for inclusion in our
proxy statement pursuant to Rule 14a-8 under the Exchange Act, must, in
accordance with our bylaws, deliver a copy of their proposal no earlier than the
90th day prior to such annual meeting and not later than the close of business
on the later of the 60th day prior to the first anniversary of the preceding
year’s annual meeting; provided, however, that in the event that the date of the
annual meeting is advanced by more than 30 days or delayed by more than 60 days
from such anniversary date or if the Company has not previously held an annual
meeting, notice by the stockholder to be timely must be so delivered not earlier
than the close of business on the 90th day
prior to such annual meeting and not later than the close of business on the
later of the 60th day
prior to such annual meeting or the tenth day following the day on which public
announcement of the date of such meeting is first made. Public
announcement means disclosure in a press release reported by the Dow Jones News
Service, Associated Press or comparable news service or in a document publicly
filed by the company with the SEC pursuant to Section 13, 14 or 15(d) of the
Securities Exchange Act of 1934, as amended. Any shareholder submitting a
proposal must provide a brief description of the business desired to be brought
before the meeting, the reasons for conducting such business at the meeting and
any material interest in such business of such stockholder and the beneficial
holder, if any, on whose behalf the proposal is made. The stockholder and the
beneficial owner, if any, on whose behalf the proposal is made must provide
their name and address as it appears on the books of the Company and the class
and number of shares of the Company which are beneficially owned and of record.
Furthermore, such stockholder must promptly provide any other information
reasonably requested by the Company.
TRANSACTION OF OTHER BUSINESS
At the
date of this Proxy Statement, the only business which our Board of Directors
intends to present or knows that others will present at the meeting is as set
forth above. If any other matter or matters are properly brought before the
meeting, or any adjournment thereo, it is the intention of the persons named in
the accompanying form of proxy to vote the proxy on such matters in accordance
with their best judgment.
Your
cooperation in giving this matter your immediate attention and returning your
proxies will be appreciated.
|
By
Order of the Board of Directors
|
|
|
/s/
Michael K. Wilhelm
|
|
|
President
and Chief Executive Officer
|
Dated:
May 9, 2008
Scottsdale,
Arizona
PROXY
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
IR
BIOSCIENCES HOLDINGS, INC.
The
undersigned hereby appoints Messrs. Michael K. Wilhelm and John N. Fermanis,
each of them as proxy holders with full power of substitution, to represent,
vote and act with respect to all shares of Common Stock of IR BioSciences
Holdings, Inc. which the undersigned would be entitled to vote at the annual
meeting of Stockholders to be held on June 25, 2008, at 9:00 a.m., local time,
at the Villagio Inn, located at The Vintage Estates, 6841 Washington Street,
Yountville, California ,94599, or any adjournments thereof, with all the powers
the undersigned would possess if personally present as
follows:
(Continued,
and to be marked, dated and signed, on the other side)
|
\/
DETACH PROXY CARD HERE
\/
IR
BIOSCIENCES HOLDINGS, INC.
|
The Board of Directors recommends a
vote “FOR” each of the proposals. The Proxy confers authority
to vote and shall be voted in accordance with such recommendation unless a
contrary instruction is indicated, in which case, the shares represented by the
Proxy will be voted in accordance with such instruction. If no instruction is specified with
respect to the matter to be acted upon, the shares represented by the proxy will
be voted “FOR” the proposal and in accordance with the recommendations of
management. If any other business is presented at the meeting, this
Proxy confers authority to and shall be voted in accordance with the
recommendations of management.
|
1. THE ELECTION OF SIX DIRECTORS TO
HOLD OFFICE UNTIL THE 2008 ANNUAL MEETING OF
STOCKHOLDERS
|
3.
In
the event Proposal No. 2 is approved by the stockholders, approval of the
amendment to IR BioSciences Holdings, Inc.’s 2003 Stock Option, Deferred
Stock and Restricted Stock Plan to increase the number of shares of the
Company’s Common Stock reserved and available for issuance under the Plan
from 20,000,000 to 60,000,000
|
|||
|
01
Michael K. Wilhelm
02
Hal N. Siegel, Ph.D.
03
Theodore E. Staahl, M.D.
o Vote For All Nominees (except as
marked)
|
04
Robert J. Hariri, M.D., Ph.D.
05
Lance K. Gordon, Ph.D.
06
Jerome B. Zeldis, M.D., Ph.D.
o Vote WITHHELD From All
Nominees
|
(INSTRUCTIONS:
TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDICATED NOMINEE,
WRITE
THE NUMBER(S) OF THE NOMINEE(S) ON THE LINE BELOW.)
___________________
___________________
___________________
|
o FOR o AGAINST o ABSTAIN
|
|
|
2. Approval of an
amendment to IR BioSciences Holdings, Inc.’s Certificate of Incorporation,
as amended, to increase the number of authorized shares of Common Stock
from 250,000,000 to 450,000,000.
|
4. Approval
of an Amendment to IR BioSciences Holdings, Inc.’s Certificate of
Incorporation, as amended, providing for a recapitalization in which the
issued and outstanding shares of the Company’s Common Stock are to be
reverse split at a ratio of one-for-ten at any time prior to March 31,
2009, with the timing thereof, if at all, to be determined by the Board of
Directors in its sole discretion, and to decrease the number of authorized
shares of Common Stock to 100,000,000.
|
|||
|
o FOR o AGAINST o ABSTAIN
|
o FOR o AGAINST o ABSTAIN
|
|||
|
5. The
ratification of the appointment of Russell Bedford
Stefanou Mirchandani LLP as our independent public accountants
for the year ending December 31, 2008.
|
||||
|
o FOR
o AGAINST o ABSTAIN
|
||||
|
(Please
date this Proxy and sign your name as it appears on your stock
certificates. Executors, administrators, trustees, etc., should
give their full title. If a corporation, please sign in full
corporate name by the president or other authorized officer. If
a partnership, please sign in partnership name by an authorized
person. All joint owners should sign.)
|
6. Transaction
of such other business as may properly come before the meeting and any
adjournments or adjournments thereof.
o FOR o AGAINST o ABSTAIN
(Number
of Shares)
|
|||
|
(Please
Print Your Name)
|
||||
|
(Please
Print Your Name)
|
||||
|
(Date)
|
||||
|
(Signature
of Shareholder)
|
||||
|
(Signature
of Shareholder)
|
||||
|
(Email
Address)
|
||||
|
This
Proxy may be revoked prior to its exercise by filing with our Secretary
duly executed proxy bearing a later date or an instrument revoking this
Proxy, or by attending the meeting and voting in
person.
|
||||
|
Please
Detach Here
^
You Must Detach This
Portion of the Proxy Card ^
Before
Returning it in the Enclosed
Envelope
|
APPENDIX
A
PROPOSED
AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION, AS AMENDED
CERTIFICATE
OF AMENDMENT
TO
CERTIFICATE
OF INCORPORATION
OF
IR
BIOSCIENCES HOLDINGS, INC.,
a
Delaware corporation
Pursuant
to Section 242 of the General Corporation Law of the State of Delaware, the
undersigned, Michael K. Wilhelm, President and Chief Executive Officer of IR
BioSciences Holdings, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY,
FIRST: The
name of the Corporation is IR BioSciences Holdings, Inc. (hereinafter the
“Corporation”).
SECOND: Pursuant
to Section 242 of the Delaware General Corporation Law, the Board of Directors
of the Corporation has duly adopted a resolution proposing and declaring
advisable the amendment to the Certificate of Incorporation of the Corporation,
as amended, set forth in this Certificate of Amendment as follows:
RESOLVED,
that, Article FOURTH of the Certificate of Incorporation of the Corporation, as
amended, is amended by striking out the first paragraph of subsection (a)
consisting of three sentences of the Article thereof numbered “FOURTH” and
changing said Article so that as amended, the first paragraph of subsection (a)
of said Article shall read as follows:
This
Corporation is authorized to issue two classes of stock to be designated as
“Common Stock” and “Preferred Stock”. The total number of shares of
Common Stock which this Corporation is authorized to issue is Four Hundred Fifty
Million (450,000,000) shares, par value $0.001 per share. The total
number of shares of Preferred Stock which this Corporation is authorized to
issue is Ten Million (10,000,000) shares, par value $0.001 per
share.”
THIRD: Pursuant
to Section 242 of the Delaware General Corporation Law, a majority of the
outstanding stock entitled to vote thereon and a majority of the outstanding
stock of each class entitled to vote thereon as a class has duly approved, the
amendment to the Certificate of Incorporation of the Corporation, as amended,
set forth in this Certificate of Amendment.
FOURTH:
That said amendment was duly adopted, in accordance with the provisions of
Section 242 of the General Corporation law of the State of
Delaware.
FIFTH: This
amendment shall be effective on the date this Certificate of Amendment is filed
and accepted by the Secretary of State of the State of Delaware.
IN WITNESS WHEREOF, the undersigned,
being the Chief Executive Officer of the Corporation, for purposes of amending
its Certificate of Incorporation pursuant to the General Corporation Law of the
State of Delaware, acknowledges that it is his act and deed and that the facts
stated herein are true, and has signed this instrument this __ day
of __________, 2008.
|
|
IR
BIOSCIENCES HOLDINGS, INC.
|
|
|
By:
|
|
| Name: Michael K. Wilhelm | ||
| Title: Chief Executive Officer |
APPENDIX
B
AMENDMENT
NO. 3
TO
IR
BIOSCIENCES HOLDINGS, INC.
2003
STOCK OPTION, DEFERRED STOCK AND RESTRICTED STOCK PLAN
Pursuant
to Section 7 of the IR BioSciences Holdings, Inc. 2003 Stock Option, Deferred
Stock and Restricted Stock Plan (the “Plan”) the Board of Directors has duly
adopted a resolution, conditioned upon approval by the Stockholders to increase
the total number of shares of Common Stock reserved and available for issuance
under the Plan as follows:
Section
3(a) of Plan is hereby amended to read in its entirety as follows:
“SECTION 3 STOCK SUBJECT TO
PLAN
|
(a)
|
The
total number of shares of Stock reserved and available for issuance under
the Plan shall be 60,000,000 shares. Such shares shall consist
of authorized and unissued shares.”
|
All other
terms and provisions of the Plan shall remain unchanged and in full force and
effect as written.
Pursuant
to Section 7 of the Plan, a majority in voting interest of the Stockholders
present in person or by proxy and entitled to vote at the meeting of
Stockholders at which this Amendment No. 3 was considered, has duly approved
this Amendment No. 3 to the Plan.
IN
WITNESS WHEREOF, this Amendment No. 3 is made effective this ___ day of
__________, 2008.
IR
BIOSCIENCES HOLDINGS, INC.,
A
Delaware Corporation
________________________________
Name: Michael
K. Wilhelm
Title:
Chief Executive Officer
APPENDIX
C
PROPOSED
AMENDMENT TO THE COMPANY’S CERTIFICATE OF INCORPORATION, AS AMENDED
CERTIFICATE
OF AMENDMENT
TO
CERTIFICATE
OF INCORPORATION
OF
IR
BIOSCIENCES HOLDINGS, INC.,
a
Delaware corporation
Pursuant
to Section 242 of the General Corporation Law of the State of Delaware, the
undersigned, Michael K. Wilhelm, President and Chief Executive Officer of IR
BioSciences Holdings, Inc., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY,
FIRST: The
name of the Corporation is IR BioSciences Holdings, Inc. (hereinafter the
“Corporation”).
SECOND: Pursuant
to Section 242 of the Delaware General Corporation Law, the Board of Directors
of the Corporation has duly adopted a resolution proposing and declaring
advisable the amendment to the Certificate of Incorporation of the Corporation,
as amended, set forth in this Certificate of Amendment as follows:
RESOLVED,
that, Article FOURTH of the Certificate of Incorporation of the Corporation, as
amended, is amended by striking out the first paragraph of subsection (a)
consisting of three sentences of the Article thereof numbered “FOURTH” and
changing said Article so that as amended, the first paragraph of subsection (a)
of said Article shall read as follows:
“This
Corporation is authorized to issue two classes of stock to be designated as
“Common Stock” and “Preferred Stock”. The total number of shares of
Common Stock which this Corporation is authorized to issue is One Hundred
Million (100,000,000) shares, par value $0.001 per share. The total
number of shares of Preferred Stock which this Corporation is authorized to
issue is Ten Million (10,000,000) shares, par value $0.001 per
share.”
RESOLVED,
that Article FOURTH of the Certificate of Incorporation of the Corporation, as
amended, is amended by striking out the first paragraph of subsection (b)
consisting of one sentence of the Article thereof numbered “FOURTH” and changing
said Article so that as amended, subsection (b) of said Article shall read as
follows:
“Upon the
effectiveness of the amendment contained in this Certificate of Amendment (the
“Effective Date”) each ten (10) shares of Common Stock, par value $.001 per
share, of this Corporation’s issued and outstanding Common Stock at the close of
business on the Effective Date shall be converted into one (1) share of fully
paid and nonassessable Common Stock, without change in the aggregate number of
shares of Common Stock this Corporation shall be authorized to issue pursuant to
Article Fourth (a).”
THIRD: Pursuant
to Section 242 of the Delaware General Corporation Law, a majority of the
outstanding stock entitled to vote thereon and a majority of the outstanding
stock of each class entitled to vote thereon as a class has duly approved, the
amendment to the Certificate of Incorporation of the Corporation, as amended,
set forth in this Certificate of Amendment.
FOURTH:
That said amendment was duly adopted, in accordance with the provisions of
Section 242 of the General Corporation law of the State of
Delaware.
FIFTH: This
amendment shall be effective on the date this Certificate of Amendment is filed
and accepted by the Secretary of State of the State of Delaware.
IN
WITNESS WHEREOF, the undersigned, being the Chief Executive Officer of the
Corporation, for purposes of amending its Certificate of Incorporation pursuant
to the General Corporation Law of the State of Delaware, acknowledges that it is
his act and deed and that the facts stated herein are true, and has signed this
instrument this __ day of __________, 2008.
IR
BIOSCIENCES HOLDINGS, INC.,
By:
________________________________
Name: Michael
K. Wilhelm
Title:
Chief Executive Officer
APPENDIX
D
AMENDED
AND RESTATED BYLAWS
OF
IR
BIOSCIENCES HOLDINGS, INC.
A
Delaware Corporation
ARTICLE
I: OFFICES
SECTION 1.1 Registered
Office.
The
registered office of IR BioSciences Holdings, Inc,. ("Corporation")
shall be at and the name of its registered agent at that address is 2711
Centerville Road, Suite 400, Wilmington, Delaware 19808 and the name of its
registered agent at that address is Corporation Service Company.
SECTION 1.2 Principal
Office.
The
principal office for the transaction of the business of the Corporation shall be
8767 E. Via De Ventura, Suite # 190, Scottsdale, Arizona, 85258, or
otherwise as set forth in a resolution adopted by the Board.
SECTION 1.3 Other
Offices.
The
Corporation may also have an office or offices at such other place or places,
either within or without the State of Delaware, as the Board may from time to
time determine or as the business of the Corporation may require.
ARTICLE
II: MEETINGS OF STOCKHOLDERS
SECTION 2.1 Place of
Meetings.
All
annual meetings of stockholders and all other meetings of stockholders shall be
held either at the principal office of the Corporation or at any other place
within or without the State of Delaware that may be designated by the Board
pursuant to authority hereinafter granted to the Board.
SECTION 2.2 Annual
Meetings.
Annual
meetings of stockholders of the Corporation for the purpose of electing
directors and for the transaction of such other business as may properly come
before such meetings may be held at such time and place and on such date as the
Board shall determine by resolution.
SECTION 2.3 Special
Meetings.
A special
meeting of the stockholders for the transaction of any proper business may be
called at any time exclusively by the Board or the Chairman.
SECTION 2.4 Notice of
Meetings.
Except as
otherwise required by law, notice of each meeting of stockholders, whether
annual or special, shall be given not less than ten (10) days nor more than
sixty (60) days before the date of the meeting to each stockholder of record
entitled to vote at such meeting by delivering a typewritten or printed notice
thereof to such stockholder personally, or by depositing such notice in the
United States mail, in a postage prepaid envelope, directed to such stockholder
at such stockholder's post office address furnished by such stockholder to the
Secretary of the Corporation for such purpose, or, if such stockholder shall not
have furnished an address to the Secretary for such purpose, then at such
stockholder's post office address last known to the Secretary, or by
transmitting a notice thereof to such stockholder at such address by telegraph,
cable, wireless or facsimile. Except as otherwise expressly required by law, no
publication of any notice of a meeting of stockholders shall be required. Every
notice of a meeting of stockholders shall state the place, date and hour of the
meeting and, in the case of a special meeting, shall also state the purpose for
which the meeting is called. Notice of any meeting of stockholders shall not be
required to be given to any stockholder to whom notice may be omitted pursuant
to applicable Delaware law or who shall have waived such notice, and such notice
shall be deemed waived by any stockholder who shall attend such meeting in
person or by proxy, except a stockholder who shall attend such meeting for the
express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened. Except as otherwise expressly required by law, notice of any adjourned
meeting of stockholders need not be given if the time and place thereof are
announced at the meeting at which the adjournment is taken.
SECTION 2.5 Fixing Date for
Determination of Stockholders of Record.
In order
that the Corporation may determine the stockholders entitled to notice of or to
vote at any meeting of stockholders or any adjournment thereof, or entitled to
receive payment of any dividend or other distribution or allotment of any
rights, or entitled to exercise any rights in respect of any other change,
conversion or exchange of stock or for the purpose of any other lawful action
other than to consent to corporate action in writing without a meeting, the
Board may fix, in advance, a record date, which shall not be more than sixty
(60) nor less than ten (10) days before the date of such meeting, nor more than
sixty (60) days prior to any such other action. If in any case involving the
determination of stockholders for any purpose other than notice of or voting at
a meeting of stockholders the Board shall not fix such a record date, then the
record date for determining stockholders for such purpose shall be the close of
business on the day on which the Board shall adopt the resolution relating
thereto. A determination of stockholders entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of such meeting;
provided, however, that the Board may fix a new record date for the adjourned
meeting.
SECTION 2.6 Quorum.
Except as
otherwise required by law, the holders of record of a majority in voting
interest of the shares of stock of the Corporation entitled to be voted thereat,
present in person or by proxy, shall constitute a quorum for the transaction of
business at any meeting of stockholders of the Corporation or any adjournment
thereof. Subject to the requirement of a larger percentage vote, if any,
contained in the Certificate of Incorporation, these Bylaws or by statute, the
stockholders present at a duly called or held meeting at which a quorum is
present may continue to do business until adjournment, notwithstanding any
withdrawal of stockholders that may leave less than a quorum remaining, if any
action taken (other than adjournment) is approved by the vote of at least a
majority in voting interest of the shares required to constitute a quorum. In
the absence of a quorum at any meeting or any adjournment thereof, a majority in
voting interest of the stockholders present in person or by proxy and entitled
to vote thereat or, in the absence therefrom of all the stockholders, any
officer entitled to preside at, or to act as secretary of, such meeting may
adjourn such meeting from time to time. At any such adjourned meeting at which a
quorum is present, any business may be transacted that might have been
transacted at the meeting as originally called.
SECTION 2.7 Voting.
(A) Each
stockholder shall, at each meeting of stockholders, be entitled to vote, in the
manner prescribed by the Corporation's Certificate of Incorporation, in person
or by proxy each share of the stock of the Corporation that has voting rights on
the matter in question and that shall have been held by such stockholder and
registered in such stockholder's name on the books of the
Corporation:
(i) on
the date fixed pursuant to Section 2.5 of these Bylaws as the record date for
the determination of stockholders entitled to notice of and to vote at such
meeting; or
(ii) if
no such record date shall have been so fixed, then (a) at the close of business
on the business day next preceding the day upon which notice of the meeting
shall be given or (b) if notice of the meeting shall be waived, at the close of
business on the business day next preceding the day upon which the meeting shall
be held.
(B)
Shares of the Corporation's own stock belonging to the Corporation or to another
corporation, if a majority of the shares entitled to vote in the election of
directors in such other corporation is held, directly or indirectly, by the
Corporation, shall neither be entitled to vote nor be counted for quorum
purposes. Persons holding stock of the Corporation in a fiduciary capacity shall
be entitled to vote such stock. Persons whose stock is pledged shall be entitled
to vote, unless in the transfer by the pledgor on the books of the Corporation
the pledgor shall have expressly empowered the pledgee to vote thereon, in which
case only the pledgee, or the pledgee's proxy, may represent such stock and vote
thereon. Stock having voting power standing of record in the names of two or
more persons, whether fiduciaries, members of a partnership, joint tenants,
tenants in common, tenants by the entirety or otherwise, or with respect to
which two or more persons have the same fiduciary relationship, shall be voted
in accordance with the provisions of the Delaware General Corporation Law, as
the same exists or may hereafter be amended (the "DGCL").
(C)
Subject to the provisions of the Corporation's Certificate of Incorporation, any
such voting rights may be exercised by the stockholder entitled thereto in
person or by such stockholder's proxy appointed by an instrument in writing,
subscribed by such stockholder or by such stockholder's attorney thereunto
authorized and delivered to the secretary of the meeting. The attendance at any
meeting of a stockholder who may theretofore have given a proxy shall not have
the effect of revoking the same unless such stockholder shall in writing so
notify the secretary of the meeting prior to the voting of the proxy. At any
meeting of stockholders at which a quorum is present, all matters, except as
otherwise provided in the Certificate of Incorporation, in these Bylaws or by
law, shall be decided by the vote of a majority in voting interest of the
stockholders present in person or by proxy and entitled to vote thereat and
thereon. The vote at any meeting of stockholders on any question need not be by
ballot, unless so directed by the chairman of the meeting. On a vote by ballot,
each ballot shall be signed by the stockholder voting, or by such stockholder's
proxy, if there be such proxy, and it shall state the number of shares
voted.
SECTION 2.8 Inspectors of
Election.
Prior to
each meeting of stockholders, the Chairman of such meeting shall appoint an
inspector(s) of election to act with respect to any vote. Each inspector of
election so appointed shall first subscribe an oath faithfully to execute the
duties of an inspector of election at such meeting with strict impartiality and
according to the best of such inspector of election's ability. Such inspector(s)
of election shall decide upon the qualification of the voters and shall certify
and report the number of shares represented at the meeting and entitled to vote
on any question, determine the number of votes entitled to be cast by each
share, shall conduct the vote and, when the voting is completed, accept the
votes and ascertain and report the number of shares voted respectively for and
against each question, and determine, and retain for a reasonable period a
record of the disposition of, any challenge made to any determination made by
such inspector(s) of election. Reports of inspector(s) of election shall be in
writing and subscribed and delivered by them to the Secretary of the
Corporation. The inspector(s) of election need not be stockholders of the
Corporation, and any officer of the Corporation may be an inspector(s) of
election on any question other than a vote for or against a proposal in which
such officer shall have a material interest. The inspector(s) of election may
appoint or retain other persons or entities to assist the inspector(s) of
election in the performance of the duties of the inspector(s) of
election.
SECTION 2.9 Advance Notice of
Stockholder Proposals and Stockholder Nominations.
Nominations
of persons for election to the board of directors of the Corporation and the
proposal of business to be considered by the stockholders may be made at any
meeting of stockholders only (a) pursuant to the Corporation's notice of
meeting, (b) by or at the direction of the Board, or (c) by any stockholder of
the Corporation who was a stockholder of record at the time of giving of notice
provided for in these bylaws, who is entitled to vote at the meeting and who
complies with the notice procedures set forth in this Section 2.9.
To be
timely, a stockholder's notice shall be delivered to the secretary at the
principal executive offices of the Corporation not later than the close of
business on the 60th day nor earlier than the close of business on the 90th day
prior to the first anniversary of the preceding year's annual meeting; provided,
however, that in the event that the date of the annual meeting is advanced by
more than 30 days or delayed by more than 60 days from such anniversary date or
if the Corporation has not previously held an annual meeting, notice by the
stockholder to be timely must be so delivered not earlier than the close of
business on the 90th day prior to such annual meeting and not later than the
close of business on the later of the 60th day prior to such annual meeting or
the tenth day following the day on which public announcement of the date of such
meeting is first made by the Corporation. In no event shall the
public announcement of a postponement or adjournment of an annual meeting to a
later date or time commence a new time period for the giving of a stockholder's
notice as described above.
Such
stockholder's notice shall set forth (I) as to each person whom the stockholder
proposes to nominate for election or reelection as a director (a) all
information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors in an election contest, or is
otherwise required, in each case pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (or any successor thereto) (including such
person's written consent to being named in the proxy statement as a nominee and
to serving as a director if elected), (b) the name and address of the
stockholder who intends to make the nomination and of the person or persons to
be nominated, (c) a representation that the stockholder is a holder of record of
stock of the Corporation entitled to vote at such meeting and intends to appear
in person or by proxy at the meeting and nominate the person or persons
specified in the notice; (d) a description of all arrangements or understandings
between the stockholder and each nominee and any other person or persons (naming
such person or persons) pursuant to which the nomination or nominations are to
be made by the stockholder; and (e) such other information regarding each
nominee proposed by such stockholder as would be required to be included in a
proxy statement filed pursuant to the proxy rules of the United States
Securities and Exchange Commission had the nominee been nominated, or intended
to be nominated, by the Board, (II) as to any other business that the
stockholder proposes to bring before the meeting, a brief description of the
business desired to be brought before the meeting, the reasons for conducting
such business at the meeting and any material interest in such business of such
stockholder and the beneficial owner, if any, on whose behalf the proposal is
made; and (III) as to the stockholder giving the notice and the beneficial
owner, if any, on whose behalf the nomination or proposal is made (a) the name
and address of such stockholder, as they appear on the Corporation's books, and
of such beneficial owner, and (b) the class and number of shares of the
corporation which are owned beneficially and of record by such stockholder and
such beneficial owner. In addition, the stockholder making such
proposal shall promptly provide any other information reasonably requested by
the Corporation. Notwithstanding anything in these Bylaws to the contrary, no
business shall be conducted at any meeting of the stockholders except in
accordance with the procedures set forth in this Section 2.9(A). The Chairman of
any such meeting shall direct that any nomination or business not properly
brought before the meeting shall not be considered.
SECTION 2.10 Action Without
Meeting.
Any
action required to be taken at any annual or special meeting of stockholders of
the Corporation, or any action which may be taken at any annual or special
meeting of such stockholders, may, if such action has been earlier approved by
the Board, be taken without a meeting, without prior notice and without a vote,
if a consent in writing, setting forth the action so taken, shall be signed by
the holders of outstanding stock having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting at
which all shares entitled to vote thereon were present and voted. Prompt notice
of the taking of the corporate action without a meeting by less than unanimous
written consent shall be given to those stockholders who have not consented in
writing.
ARTICLE III: BOARD OF
DIRECTORS
SECTION 3.1 General
Powers.
Subject
to any requirements in the Certificate of Incorporation, these Bylaws, or of the
DGCL as to action which must be authorized or approved by the stockholders, any
and all corporate powers shall be exercised by or under the authority of, and
the business and affairs of the Corporation shall be under the direction of, the
Board to the fullest extent permitted by law. Without limiting the generality of
the foregoing, it is hereby expressly declared that the Board shall have the
following powers, to wit:
(A) to
select and remove all the officers, agents and employees of the Corporation,
prescribe such powers and duties for them as may not be inconsistent with law,
the Certificate of Incorporation or these Bylaws, fix their compensation, and
require from them security for faithful service;
(B) to
conduct, manage and control the affairs and business of the Corporation, and to
make such rules and regulations therefor not inconsistent with law, the
Certificate of Incorporation or these Bylaws, as it may deem best;
(C) to
change the location of the registered office of the Corporation in Section 1.1
hereof; to change the principal office and the principal office for the
transaction of the business of the Corporation from one location to another as
provided in Section 1.2 hereof; to fix and locate from time to time one or more
offices of the Corporation within or without the State of Delaware as provided
in Section 1.3 hereof; to designate any place within or without the State of
Delaware for the holding of any meeting or meetings of stockholders; and to
adopt, make and use a corporate seal, and to prescribe the forms of certificates
of stock, and to alter the form of such seal and of such certificates from time
to time, and in its judgment as it may deem best, provided such seal and such
certificate shall at all times comply with the provisions of law;
(D) to
authorize the issuance of shares of stock of the Corporation from time to time,
upon such terms and for such considerations as may be lawful;
(E) to
borrow money and incur indebtedness for the purposes of the Corporation, and to
cause to be executed and delivered therefor, in the corporate name, promissory
notes, bonds, debentures, deeds of trust and securities therefor;
and
(F) by
resolution adopted by a majority of the whole Board to designate an executive
and other committees of the Board, each consisting of one or more directors, to
serve at the pleasure of the Board, and to prescribe the manner in which
proceedings of such committee or committees shall be conducted.
SECTION 3.2 Number and Term
of Office.
(A) Until
this Section 3.2 is amended by a resolution duly adopted by the Board or by the
stockholders of the Corporation, the number of directors constituting the entire
Board shall be not less than two (2) members nor more than nine (9) members.
Directors need not be stockholders. The number of directors constituting the
Board of Directors may be increased or decreased from time to time by resolution
by the Board of Directors; provided, however,
that no such decrease shall have the effect of shortening the term of any
incumbent director. Each of the directors of the Corporation shall
hold office for the full term and until his successor shall have been duly
elected and shall qualify, or until his earlier death or disqualification, or
until he shall resign or shall have been removed in the manner hereinafter
provided. A director need not be a resident of the State of Delaware
or a stockholder of the Corporation.
SECTION 3.3 Chairman of the
Board.
The
Chairman of the Board, when present, shall preside at all meetings of the Board
and all meetings of stockholders. The Chairman of the Board shall perform other
duties commonly incident to his office and shall also perform such other duties
and have such other powers as the Board of Directors shall designate from time
to time.
SECTION 3.4 Election of
Directors.
At each
annual meeting of stockholders, directors shall be elected to serve until the
next annual meeting or until his or her resignation or removal. The directors
shall be elected by the stockholders of the Corporation, and at each election of
directors at which a quorum is present, the persons receiving the greater number
of votes, up to the number of directors then to be elected, of the stockholders
present in person or by proxy and entitled to vote thereon shall be the persons
then elected; provided, however, that for purposes of such vote no stockholder
shall be allowed to cumulate his votes. Election of directors may be conducted
in any manner approved at such meeting.. The election of directors is subject to
any provision contained in the Certificate of Incorporation relating thereto,
including any provision regarding the rights of holders of preferred stock to
elect directors.
SECTION 3.5 Resignations.
Any
director of the Corporation may resign at any time by giving written notice to
the Board or to the Secretary of the Corporation. Any such resignation shall
take effect at the time specified therein, or, if the time is not specified, it
shall take effect immediately upon receipt; and, unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.
SECTION 3.6 Vacancies.
Except as
otherwise provided in the Certificate of Incorporation, as amended, if a vacancy
occurs on the Board from whatever cause, including a vacancy resulting from an
increase in the number of Directors, the Board may fill the vacancy, or, if the
directors in office constitute less than a quorum of the Board, they may fill
the vacancy by the affirmative vote of a majority of the remaining directors
then in office. The stockholders may fill a vacancy only if there are no
Directors in office. A Director elected to fill a vacancy shall serve only until
his successor has been duly elected and qualified. No decrease in the
number of directors constituting the Board of Directors shall shorten the term
of any incumbent director.
SECTION 3.7 Place of
Meeting.
The Board
or any committee thereof may hold any of its meetings at such place or places
within or without the State of Delaware as the Board or such committee may from
time to time by resolution designate or as shall be designated by the person or
persons calling the meeting or in the notice or a waiver of notice of any such
meeting. Directors may participate in any regular or special meeting of the
Board or any committee thereof by means of conference telephone or similar
communications equipment pursuant to which all persons participating in the
meeting of the Board or such committee can hear each other, and such
participation shall constitute presence in person at such meeting.
SECTION 3.8 Regular
Meetings.
Regular
meetings of the Board may be held at such times as the Board shall from time to
time by resolution determine.
SECTION 3.9 Special
Meetings.
Special
meetings of the Board for any purpose or purposes shall be called at any time by
the Chairman of the Board or, if the Chairman of the Board is absent or unable
or refuses to act, by the Chief Executive Officer or the President, and may also
be called by any two members of the Board. Except as otherwise provided by law
or by these Bylaws, written notice of the time and place of special meetings
shall be delivered personally or by facsimile to each director, or sent to each
director by mail or by other form of written communication, charges prepaid,
addressed to such director at such director's address as it is shown upon the
records of the Corporation, or, if it is not so shown on such records and is not
readily ascertainable, at the place in which the meetings of the directors are
regularly held. In case such notice is mailed or telegraphed, it shall be
deposited in the United States mail or delivered to the telegraph company in the
County in which the principal office for the transaction of the business of the
Corporation is located at least 48 hours prior to the time of the holding of the
meeting. In case such notice is delivered personally or by facsimile as above
provided, it shall be delivered at least 24 hours prior to the time of the
holding of the meeting. Such mailing, telegraphing, delivery or facsimile
transmission as above provided shall be due, legal and personal notice to such
director. Except where otherwise required by law or by these Bylaws, notice of
the purpose of a special meeting need not be given. Notice of any meeting of the
Board shall not be required to be given to any director who is present at such
meeting, except a director who shall attend such meeting for the express purpose
of objecting, at the beginning of the meeting, to the transaction of any
business because the meeting is not lawfully called or convened.
SECTION 3.10 Quorum and Manner
of Acting.
Except as
otherwise provided in these Bylaws, the Certificate of Incorporation or by
applicable law, the presence of a majority of the authorized number of directors
shall be required to constitute a quorum for the transaction of business at any
meeting of the Board, and all matters shall be decided at any such meeting, a
quorum being present, by the affirmative votes of a majority of the directors
present. A meeting at which a quorum is initially present may continue to
transact business notwithstanding the withdrawal of directors, provided any
action taken is approved by at least a majority of the required quorum for such
meeting. In the absence of a quorum, a majority of directors present at any
meeting may adjourn the same from time to time until a quorum shall be present.
Notice of any adjourned meeting need not be given. The directors shall act only
as a Board, and the individual directors shall have no power as
such.
SECTION 3.11 Action by
Unanimous Written Consent.
Any
action required or permitted to be taken at any meeting of the Board or of any
committee thereof may be taken without a meeting if consent in writing is given
thereto by all members of the Board or of such committee, as the case may be,
and such consent is filed with the minutes of proceedings of the Board or of
such committee.
SECTION 3.12 Compensation.
Directors,
whether or not employees of the Corporation or any of its subsidiaries, may
receive an annual fee for their services as directors in an amount fixed by
resolution of the Board plus other compensation, including options to acquire
capital stock of the Corporation, in an amount and of a type fixed by resolution
of the Board, and, in addition, a fixed fee, with or without expenses of
attendance, may be allowed by resolution of the Board for attendance at each
meeting, including each meeting of a committee of the Board. Nothing herein
contained shall be construed to preclude any director from serving the
Corporation in any other capacity as an officer, agent, employee, or otherwise,
and receiving compensation therefor.
SECTION 3.13 Committees.
The Board
may, by resolution passed by a majority of the whole Board, designate one or
more committees, each committee to consist of one or more of the directors of
the Corporation. Any such committee, to the extent provided in the resolution of
the Board and subject to any restrictions or limitations on the delegation of
power and authority imposed by applicable law, shall have and may exercise all
the powers and authority of the Board in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it. Any such committee shall keep
written minutes of its meetings and report the same to the Board at the next
regular meeting of the Board. Unless the Board or these Bylaws shall otherwise
prescribe the manner of proceedings of any such committee, meetings of such
committee may be regularly scheduled in advance and may be called at any time by
the chairman of the committee or by any two members thereof; otherwise, the
provisions of these Bylaws with respect to notice and conduct of meetings of the
Board shall govern.
SECTION 3.14 Affiliated
Transactions.
Notwithstanding
any other provision of these Bylaws, each transaction, or, if an individual
transaction constitutes a part of a series of transactions, each series of
transactions, proposed to be entered into between the Corporation, on the one
hand, and any affiliate of the Corporation, on the other hand, must be approved
by the Board. For the purposes of this Section 3.14, (a) "affiliate"
shall mean (i) any person that, directly or indirectly, controls or is
controlled by or is under common control with the Corporation, (ii) any other
person that owns, beneficially, directly or indirectly, twenty percent (20%) or
more of the outstanding capital shares, shares or equity interests of the
Corporation, or (iii) any officer or director of the Corporation; (b) "person"
shall mean and include individuals, corporations, general and limited
partnerships, stock companies or associations, joint ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
entities and governments and agencies and political subdivisions thereof; and
(c) "control" (including the correlative meanings of the terms "controlled by"
and "under common control with"), as used with respect to any person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such person, through the ownership
of voting securities, partnership interests or other equity
interests.
ARTICLE
IV: OFFICERS
SECTION 4.1 Officers.
The
officers of the Corporation shall be a Chief Executive Officer, a President, one
or more Vice Presidents (the number thereof and their respective titles to be
determined by the Board), a Secretary, a Chief Financial Officer, and such other
officers as may be appointed at the discretion of the Board in accordance with
the provisions of Section 4.3 hereof.
SECTION 4.2 Election.
The
officers of the Corporation, except such officers as may be appointed or elected
in accordance with the provisions of Sections 4.3 or 4.5 hereof, shall be chosen
annually by the Board at the first meeting thereof after the annual meeting of
stockholders, and each officer shall hold office until such officer shall resign
or shall be removed or otherwise disqualified to serve, or until such officer's
successor shall be elected and qualified.
SECTION 4.3 Other
Officers.
In
addition to the officers chosen annually by the Board at its first meeting, the
Board also may appoint or elect such other officers as the business of the
Corporation may require, each of whom shall have such authority and perform such
duties as are provided in these Bylaws or as the Board may from time to time
specify, and shall hold office until such officer shall resign or shall be
removed or otherwise disqualified to serve, or until such officer's successor
shall be elected and qualified.
SECTION 4.4 Removal and
Resignation.
Except as
provided by DGCL Section 141(k), any officer may be removed, either with or
without cause, by resolution of the Board, at any regular or special meeting of
the Board, or, except in case of an officer chosen by the Board, by any officer
upon whom such power of removal may be conferred by the Board. Any officer or
assistant may resign at any time by giving written notice of his resignation to
the Board or the Secretary of the Corporation. Any such resignation shall take
effect at the time specified therein, or, if the time is not specified, upon
receipt thereof by the Board or the Secretary, as the case may be; and, unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective.
SECTION 4.5 Vacancies.
A vacancy
in any office because of death, resignation, removal, disqualification or any
other cause may be filled by the vote of the majority of the directors present
at any meeting in which a quorum is present, or pursuant to Section 3.11 of
these Bylaws.
SECTION 4.6 Chief Executive
Officer.
The Chief
Executive Officer shall preside at all meetings of the stockholders and at all
meetings of the Board of Directors, unless the Chairman of the Board has been
appointed and is present. The Chief Executive Officer shall be the chief
executive officer of the Corporation and shall, subject to the control of the
Board of Directors, have general supervision, direction and control of the
business and affairs of the Corporation. The Chief Executive Officer shall also
perform such other duties and have such other powers as the Board of Directors
may designate from time to time.
SECTION 4.7 President.
The
President shall preside at all meetings of the stockholders and at all meetings
of the Board of Directors, unless the Chairman of the Board has been appointed
and is present or, in the absence of the Chairman of the Board, the Chief
Executive Officer has been appointed and is present. Subject to the provisions
of these Bylaws and to the direction of the Board of Directors and Chief
Executive Officer, the President shall have the responsibility for the general
management and control of the business and affairs of the Corporation and shall
perform all duties and have all powers which are commonly incident to the office
of President or which are delegated to him by the Board of Directors. The
President shall have the power to sign all stock certificates, contracts and
other instruments of the Corporation which are authorized and shall have general
supervision and direction of all the other officers, employees and agents of the
corporation.
SECTION 4.8 Vice
President.
Each Vice
President shall have such powers and perform such duties with respect to the
administration of the business and affairs of the Corporation as are commonly
incident to their office or as may from time to time be assigned to such Vice
President by the Chairman of the Board, or the Board, or the Chief Executive
Officer, or the President, or as may be prescribed by these Bylaws. In the
absence or disability of the Chairman of the Board, the Chief Executive Officer
and the President, the Vice Presidents in order of their rank as fixed by the
Board, or if not ranked, the Vice President designated by the Board, shall
perform all of the duties of the Chairman of the Board, and when so acting shall
have all the powers of, and be subject to all the restrictions upon, the
Chairman of the Board.
SECTION 4.9 Secretary.
(A) The
Secretary shall attend all meetings of the stockholders and of the Board of
Directors and shall record all acts and proceedings thereof in the minute book
of the Corporation. The Secretary shall give notice in conformity with these
Bylaws of all meetings of the stockholders and of all meetings of the Board of
Directors and any committee thereof requiring notice. The Secretary shall
perform all other duties given him in these Bylaws and other duties commonly
incident to his office and shall also perform such other duties and have such
other powers as the Board shall designate from time to time.
(B) The
Secretary shall keep, or cause to be kept, at the principal office of the
Corporation or such other place as the Board may order, a book of minutes of all
meetings of directors and stockholders, with the time and place of holding,
whether regular or special, and if special, how authorized and the notice
thereof given, the names of those present at meetings of directors, the number
of shares present or represented at meetings of stockholders, and the
proceedings thereof.
(C) The
Secretary shall keep, or cause to be kept, at the principal office of the
Corporation's transfer agent, a share register, or a duplicate share register,
showing the name of each stockholder, the number of shares of each class held by
such stockholder, the number and date of certificates issued for such shares,
and the number and date of cancellation of every certificate surrendered for
cancellation.
SECTION 4.10 Chief Financial
Officer.
The Chief
Financial Officer shall keep or cause to be kept the books of account of the
corporation in a thorough and proper manner and shall render statements of the
financial affairs of the corporation in such form and as often as required by
the Board of Directors or the Chief Executive Officer. The Chief Financial
Officer, subject to the order of the Board, shall have the custody of all funds
and securities of the Corporation. The Chief Financial Officer shall perform
other duties commonly incident to his office and shall also perform such other
duties and have such other powers as the Board or the Chief Executive Officer
shall designate from time to time.
ARTICLE
V: CORPORATE INSTRUMENTS, CHECKS,
DRAFTS,
BANK ACCOUNTS, ETC.
SECTION 5.1 Execution of
Corporate Instruments.
The Board
of Directors may, in its discretion, determine the method and designate the
signatory officer or officers, or other person or persons, to execute on behalf
of the Corporation the corporate name without limitation, or enter into
contracts on behalf of the Corporation, except where otherwise provided by law
or these Bylaws, and such execution or signature shall be binding upon the
Corporation. Such authority may be general or confined to specific instances,
and unless so authorized by the Board or by these Bylaws, no officer, agent, or
employee shall have any power or authority to bind the Corporation by any
contract or engagement or to pledge its credit or to render it liable for any
purpose or in any amount.
SECTION 5.2 Checks, Drafts,
Etc.
All
checks, drafts or other orders for payment of money, notes or other evidence of
indebtedness, issued in the name of or payable to the Corporation, shall be
signed or endorsed by such person or persons and in such manner as, from time to
time, shall be determined by resolution of the Board. Each such officer,
assistant, agent or attorney shall give such bond, if any, as the Board may
require.
SECTION 5.3 Deposits.
All funds
of the Corporation not otherwise employed shall be deposited from time to time
to the credit of the Corporation in such banks, trust companies or other
depositories as the Board may select, or as may be selected by any officer or
officers, assistant or assistants, agent or agents, or attorney or attorneys of
the Corporation to whom such power shall have been delegated by the Board. For
the purpose of deposit and for the purpose of collection for the account of the
Corporation, the Chairman of the Board, the Chief Executive Officer, the
President, any Vice President (or any other officer or officers, assistant or
assistants, agent or agents, or attorney or attorneys of the Corporation who
shall from time to time be determined by the Board) may endorse, assign and
deliver checks, drafts and other orders for the payment of money which are
payable to the order of the Corporation.
SECTION 5.4 General and
Special Bank Accounts.
The Board
may from time to time authorize the opening and keeping of general and special
bank accounts with such banks, trust companies or other depositories as the
Board may select or as may be selected by any officer or officers, assistant or
assistants, agent or agents, or attorney or attorneys of the Corporation to whom
such power shall have been delegated by the Board. The Board may make such
special rules and regulations with respect to such bank accounts, not
inconsistent with the provisions of these Bylaws, as it may deem
expedient.
ARTICLE VI: SHARES AND THEIR
TRANSFER
SECTION 6.1 Certificates of
Stock.
Shares of
the capital stock of the Corporation may be certificated or uncertificated, as
provided under the General Corporation Law of the State of Delaware. Each
stockholder, upon written request to the transfer agent or registrar of the
Corporation, shall be entitled to a certificate of the capital stock of the
Corporation in such form as may from time to time be prescribed by the Board of
Directors. Such certificate shall be numbered in the order in which they shall
be issued and shall bear the Corporation seal and shall be signed by the
Chairman of the Board of the President or a Vice President and by the Treasurer
or an Assistant Treasurer or the Secretary or an Assistant Secretary. The
Corporation seal and the signatures by corporation officers may be facsimiles if
the certificate manually countersigned by an authorized person on behalf of a
transfer agent or registrar other than the Corporation or its employee. In case
any officer, transfer agent or registrar who has signed or whose facsimile
signature has been placed on such certificate shall have ceased to be such
officer, transfer agent or registrar before such certificate is issued, it may
be issued by the Corporation with the same effect as if such officer, transfer
agent or registrar were such officer, transfer agent or registrar at the time of
its issue. Every certificate for shares of stock which are subject to any
restriction on transfer and every certificate issued when the Corporation is
authorized to issue more than one class or series of stock shall contain such
legend with respect thereto as is required by law. A record shall be kept of the
respective names of the persons, firms or corporations owning the stock
represented by such certificates, the number and class or series of shares
represented by such certificates, respectively, and the respective dates
thereof, and in the case of cancellation, the respective dates of
cancellation.
SECTION 6.2. Transfers.
Subject
to any restrictions on transfer and unless otherwise provided by the Board of
Directors, shares of stock may be transferred only on the books of the
Corporation, if such shares are certificated, by the surrender to the
Corporation or its transfer agent of the certificate therefore properly endorsed
or accompanied by a written assignment or power of attorney properly executed,
with transfer stamps (if necessary) affixed, or upon proper instructions from
the holder of uncertificated shares, in each case with such proof of the
authenticity of signature as the Corporation or its transfer agent may
reasonably require.
SECTION 6. 3. Record
Holders.
Except
as may otherwise be required by law, by the Certificate of Incorporation or by
these By-laws, the Corporation shall be entitled to treat the record holder of
stock as shown on its books as the owner of such stock for all purposes,
including the payment of dividends and the right to vote with respect thereto,
regardless of any transfer, pledge or other disposition of such stock, until the
shares have been transferred on the books of the Corporation in accordance with
the requirements of these Bylaws.
It
shall be the duty of each stockholder to notify the Corporation of his, her or
its post office address and any changes thereto.
SECTION 6.4. Record
Date.
In order
that the Corporation may determine the stockholders entitled to receive notice
of or to vote at any meeting of stockholders or any adjournments thereof, or to
express consent to corporate action in writing without a meeting, or entitled to
receive payment of any dividend or other distribution or allotment of any
rights, or entitled to exercise any rights in respect of any change, conversion
or exchange of stock or for the purpose of any other lawful action, the Board of
Directors may fix, in advance, a record date, which, (i) with respect to any
meeting of stockholders, shall be not more than 60 nor less than 10 days (except
as otherwise required by law) before the date of such meeting, (ii) with respect
to corporate action without a meeting, shall be not more than 10 days after the
date on which the resolution fixing the record date is adopted by the Board of
Directors and (iii) with respect to any other lawful action, shall be not more
than 60 days prior to such action. In such case, only stockholders of record on
such record date shall be so entitled, notwithstanding any transfer of stock on
the books of the Corporation after the record date.
If no
record date is fixed: (i) the record date for determining stockholders entitled
to receive notice of or to vote at a meeting of stockholders shall be at the
close of business on the day next preceding the day on which notice is given,
or, if notice is waived, at the close of business on the day next preceding the
day on which the meeting is held; (ii) the record date for determining
stockholders entitled to express consent to corporate action in writing without
a meeting, when no prior action by the Board of Directors is necessary, shall be
the day on which the first written consent is expressed; and (iii) the record
date for determining stockholders for any other purpose shall be at the close of
business on the day on which the Board of Directors adopts the resolution
relating thereto.
SECTION 6. 5. Replacement of
Certificates.
In case
of the alleged loss, destruction or mutilation of a certificate of stock, a
duplicate certificate may be issued in place thereof, upon such terms as the
Board of Directors may prescribe; provided, however,
that if such shares have ceased to be certificated, a new certificate shall be
issued only upon written request to the transfer agent or registrar of the
Corporation.
SECTION 6.6 Regulations.
The Board
may make such rules and regulations as it may deem expedient, not inconsistent
with these Bylaws, concerning the issue, transfer and registration of
certificates for shares of the stock of the Corporation. It may appoint, or
authorize any officer or officers to appoint, one or more transfer clerks or one
or more transfer agents and one or more registrars, and may require all
certificates for stock to bear the signature or signatures of any of
them.
ARTICLE
VII: INDEMNIFICATION
SECTION 7.1 Indemnification
of Directors and Officers.
To the
fullest extent permitted by the Delaware General Corporation Law, as the same
exists or may hereafter be amended (provided that the effect of any such
amendment shall be prospective only) (the "Delaware Law"), a director of the
Corporation shall not be liable to the Corporation or its stockholders for
monetary damages for breach of his or her fiduciary duty as a director. The
Corporation shall indemnify, in the manner and to the fullest extent permitted
by the Delaware Law (but in the case of any such amendment, only to the extent
that such amendment permits the Corporation to provide broader indemnification
rights than permitted prior thereto), any person (or the estate of any person)
who is or was a party to, or is threatened to be made a party to, any
threatened, pending or completed action, suit or proceeding, whether or not by
or in the right of the Corporation, and whether civil, criminal, administrative,
investigative or otherwise, by reason of the fact that such person is or was a
director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise. The Corporation may, to the fullest
extent permitted by the Delaware Law, purchase and maintain insurance on behalf
of any such person against any liability which may be asserted against such
person. The Corporation may create a trust fund, grant a security interest or
use other means (including without limitation a letter of credit) to ensure the
payment of such sums as may become necessary or desirable to effect the
indemnification as provided herein. To the fullest extent permitted by the
Delaware Law, the indemnification provided herein shall include expenses as
incurred (including attorneys' fees), judgments, fines and amounts paid in
settlement and any such expenses shall be paid by the Corporation in advance of
the final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of the person seeking indemnification to repay such
amounts if it is ultimately determined that he or she is not entitled to be
indemnified. Notwithstanding the foregoing or any other provision of this
Section 7.1, no advance shall be made by the Corporation if a determination is
reasonably and promptly made by the Board by a majority vote of a quorum of
disinterested Directors, or (if such a quorum is not obtainable or, even if
obtainable, a quorum of disinterested Directors so directs) by independent legal
counsel to the Corporation, that, based upon the facts known to the Board or
such counsel at the time such determination is made, (a) the party seeking an
advance acted in bad faith or deliberately breached his or her duty to the
Corporation or its stockholders, and (b) as a result of such actions by the
party seeking an advance, it is more likely than not that it will ultimately be
determined that such party is not entitled to indemnification pursuant to the
provisions of this Section 7.1. The indemnification provided herein shall not be
deemed to limit the right of the Corporation to indemnify any other person for
any such expenses to the fullest extent permitted by the Delaware Law, nor shall
it be deemed exclusive of any other rights to which any person seeking
indemnification from the Corporation may be entitled under any agreement, the
Corporation's Bylaws, vote of stockholders or disinterested directors, or
otherwise, both as to action in such person's official capacity and as to action
in another capacity while holding such office. The Corporation may, but only to
the extent that the Board of Directors may (but shall not be obligated to)
authorize from time to time, grant rights to indemnification and to the
advancement of expenses to any employee or agent of the Corporation to the
fullest extent of the provisions of this Section 7.1 as it applies to the
indemnification and advancement of expenses of directors and officers of the
Corporation.
SECTION 7.2 Indemnification
of Employees and Agents.
Subject
to Section 7.1, the Corporation may, but only to the extent that the Board may
(but shall not be obligated to) authorize from time to time, grant rights to
indemnification and to the advancement of expenses to any employee or agent of
the Corporation to the fullest extent of the provisions of this Article VII as
they apply to the indemnification and advancement of expenses of directors and
officers of the Corporation.
SECTION 7.3 Enforcement of
Indemnification.
The
rights to indemnification and the advancement of expenses conferred above shall
be contract rights. If a claim under this Article VII is not paid in full by the
Corporation within 60 days after written claim has been received by the
Corporation, except in the case of a claim for an advancement of expenses, in
which case the applicable period shall be 20 days, the indemnitee may at any
time thereafter bring suit against the Corporation to recover the unpaid amount
of such claim. If successful in whole or in part in any such suit, or in a suit
brought by the Corporation to recover an advancement of expenses pursuant to the
terms of an undertaking, the indemnitee shall be entitled to be paid also the
expenses of prosecuting or defending such suit. In (i) any suit brought by the
indemnitee to enforce a right to indemnification hereunder (but not in a suit
brought by the indemnitee to enforce a right to an advancement of expenses) it
shall be a defense that, and (ii) any suit by the Corporation to recover an
advancement of expenses pursuant to the terms of an undertaking the Corporation
shall be entitled to recover such expenses upon a final adjudication that, the
indemnitee has not met any applicable standard for indemnification set forth in
the DGCL. Neither the failure of the Corporation (including its Board,
independent legal counsel or stockholders) to have made a determination prior to
the commencement of such suit that indemnification of the indemnitee is proper
in the circumstances because the indemnitee has met the applicable standard of
conduct set forth in the DGCL, nor an actual determination by the Corporation
(including its Board, independent legal counsel or stockholders) that the
indemnitee has not met such applicable standard of conduct, shall either create
a presumption that the indemnitee has not met the applicable standard of conduct
or, in the case of such a suit brought by the indemnitee, be a defense to such
suit. In any suit brought by the indemnitee to enforce a right to
indemnification or to an advancement of expenses hereunder, or by the
Corporation to recover an advancement of expenses pursuant to the terms of an
undertaking, the burden of proving that the indemnitee is not entitled to be
indemnified, or to such advancement of expenses, under this Article VII or
otherwise shall be on the Corporation.
ARTICLE
VIII: MISCELLANEOUS
SECTION 8.1 Seal.
The Board
shall adopt a corporate seal, which shall be in the form set forth in a
resolution approved by the Board.
SECTION 8.2 Waiver of
Notices.
Whenever
notice is required to be given by these Bylaws or the Certificate of
Incorporation or by law, the person entitled to said notice may waive such
notice in writing, either before or after the time stated therein, and such
waiver shall be deemed equivalent to notice.
SECTION 8.3 Amendments.
Except as
otherwise provided herein, by law, or in the Certificate of Incorporation, these
Bylaws or any of them may be altered, amended, repealed or rescinded and new
Bylaws may be adopted by the Board or by the stockholders at any annual or
special meeting of stockholders, provided that notice of such proposed
alteration, amendment, repeal, recession or adoption is given in the notice of
such meeting of stockholders.
CERTIFICATE OF
SECRETARY OF ADOPTION OF BYLAWS
I, the
undersigned, do hereby certify:
That I am
the Secretary of IR BioSciences Holdings,, Inc., a Delaware corporation, that
the foregoing Bylaws, comprising sixteen pages, constitute the Bylaws of said
corporation as duly adopted by the Board of Directors of the corporation on
April 19, 2008.
IN WITNESS WHEREOF, I have hereunto
subscribed my name and affixed the seal of said corporation on this 29th day
of April 2008.
By: /s/ Michelle R.
Laroche