Item 2.01.
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Completion of Acquisition or Disposition of Assets.
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THE MERGER AND RELATED TRANSACTIONS
The disclosure set
forth under “Introductory Note” above is incorporated in this Item 2.01 by reference. The material terms and conditions
of the Merger Agreement and its related agreements are described on pages 102 to 105 of CHAC’s Definitive Proxy Statement
in the section entitled “The Merger Agreement,” which is incorporated herein by reference.
BUSINESS
The business of
the Company after the Business Combination is described in Definitive Proxy Statement in the section entitled “BiomX Ltd.’s
Business” beginning on page 136, including in the section entitled “BiomX Ltd.’s Business—Facilities”
beginning on page 172, and in the section entitled “Government Regulation” beginning on page 173, and that information
is incorporated herein by reference.
RISK FACTORS
The risks associated
with the Company’s business are described in the Definitive Proxy Statement in the section entitled “Risk Factors”
beginning on page 15 and are incorporated herein by reference.
SELECTED FINANCIAL DATA
The disclosure contained
in the Definitive Proxy Statement in the section entitled “Selected Historical Consolidated Financial and Operating Data
of BiomX Ltd.” beginning on page 115 is incorporated herein by reference.
MANAGEMENT’S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The disclosure contained
in the Definitive Proxy Statement in the section entitled “Management’s Discussion And Analysis of Financial Condition
And Results of Operations of BiomX” beginning on page 117 is incorporated herein by reference.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table
sets forth information regarding the beneficial ownership of our Common Stock as of the Closing (taking in account of the redemption
in connection with the Business Combination and automatic exchange of rights into Common Stock at the Closing), based on information
obtained from the persons named below, with respect to the beneficial ownership of our Common Stock, by:
|
●
|
each person known by us to be the beneficial owner of more than 5% of our outstanding Common Stock;
|
|
●
|
each of our executive officers and directors that beneficially owns our Common Stock; and
|
|
●
|
all our executive officers and directors as a group.
|
Unless otherwise
indicated, we believe that all persons named in the table have sole voting and investment power with respect to all Common Stock
beneficially owned by them. As of the Closing, we had 22,835,153 shares of Common Stock issued and outstanding.
Name and Address of Beneficial Owner(1)
|
|
Amount and Nature of Beneficial
Ownership
|
|
|
Percent of
Class
|
|
Chardan Investments, LLC(2)
|
|
|
4,607,500
|
|
|
|
17.9
|
%
|
Takeda Pharmaceutical Company Limited
Takeda Ventures, Inc.(3)
|
|
|
2,470,935
|
|
|
|
10.8
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%
|
OrbiMed Advisors Israel Limited
OrbiMed Israel GP Ltd.
OrbiMed Israel Partners, Limited Partnership(4)
|
|
|
2,290,490
|
|
|
|
10.0
|
%
|
Johnson & Johnson Innovation – JJDC, Inc.(5)
|
|
|
2,133,402
|
|
|
|
9.3
|
%
|
Jonathan Solomon(6)
|
|
|
326,440
|
|
|
|
1.4
|
%
|
Assaf Oron(7)
|
|
|
137,809
|
|
|
|
*
|
|
Sailaja Puttagunta(8)
|
|
|
45,985
|
|
|
|
*
|
|
Merav Bassan
|
|
|
0
|
|
|
|
0
|
|
Inbar Gahali-Sass(9)
|
|
|
20,692
|
|
|
|
*
|
|
Myriam Golembo(10)
|
|
|
26,610
|
|
|
|
*
|
|
Uri Ben-Or
|
|
|
0
|
|
|
|
0
|
|
Russell Greig
|
|
|
0
|
|
|
|
0
|
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Gbola Amusa(11)
|
|
|
527,862
|
|
|
|
2.3
|
%
|
Yaron Breski
|
|
|
0
|
|
|
|
0
|
|
Erez Chimovits
|
|
|
0
|
|
|
|
0
|
|
Jonas Grossman(12)
|
|
|
4,607,500
|
|
|
|
17.9
|
|
Robbie Woodman
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
All directors and officers as a group (Post-Business Combination)
(13 persons)
|
|
|
5,692,898
|
|
|
|
20.0
|
%
|
(1)
|
|
Unless otherwise
indicated, the business address of each of the individuals is c/o BiomX Ltd., 7 Pinhas Sapir St., Floor 2, Ness Ziona 7414002,
Israel.
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(2)
|
|
Represents 1,707,500 shares of Common Stock held by Chardan Investments,
LLC and warrants to purchase 2,900,000 shares of Common Stock held by Mount Wood, LLC, which owns approximately 67.96% of
Chardan Investments, LLC. Jonas Grossman, a member of our Board of Directors is the managing member of each of Chardan
Investments, LLC and Mountain Wood, LLC, and thereby has sole voting and dispositive power over such shares. The business
address of each of the foregoing is c/o Chardan Healthcare Acquisition Corp., 17 State Street, 21st Floor, New York, NY
10004.
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(3)
|
|
The business
address of Takeda Ventures, Inc. (“Takeda Ventures”) is 435 Tasso Street, Suite 300, Palo Alto, CA 94301 USA. Takeda
Ventures is a wholly-owned direct subsidiary of Takeda Pharmaceuticals U.S.A., Inc. (“Takeda USA”). Takeda Pharmaceuticals
International AG and Takeda Pharmaceutical Company Limited together own 100% of Takeda USA. Takeda Pharmaceuticals International
AG is a wholly-owned direct subsidiary of Takeda Pharmaceutical Company Limited. As a result, Takeda Pharmaceutical Company Limited
may be deemed to have voting and investment power over all of the shares of Common Stock held by Takeda Ventures, and Takeda Pharmaceutical
Company Limited may be deemed to be the indirect beneficial owner of the shares held by Takeda Ventures.
|
(4)
|
|
Represents
1,649,151 shares of Common Stock held directly by OrbiMed Israel Partners, Limited Partnership (“OIP LP”) and 641,339
shares of Common Stock held directly by OrbiMed Israel Incubator L.P. (“OII LP”). 89 Medinat Hayehudim St., Building
E, Herzliya 4614001 Israel. OrbiMed Israel BioFund GP Limited Partnership (“BioFund GP LP”) is the general partner
of each of OIP LP and OII LP, and OrbiMed Israel GP Ltd. (“Israel GP”) is the general partner of BioFund GP LP. OrbiMed
Advisors Israel Limited (“Advisors Israel Ltd”) is the majority shareholder of Israel GP. As a result, Advisors Israel
Ltd and Israel GP may be deemed to have shared voting and investment power over all of the shares of Common Stock held by each
of OIP LP and OII LP, and both Advisors Israel Ltd and Israel GP may be deemed to directly or indirectly, including by reason
of their mutual affiliation, to be the beneficial owners of the shares held by each of OIP LP and OII LP. Advisors Israel Ltd
exercises this investment power through an investment committee comprised of Carl L. Gordon, Jonathan T. Silverstein, Nissim Darvish,
Anat Naschitz, and Erez Chimovits, each of whom disclaims beneficial ownership of the shares held by OIP LP and OII LP.
|
(5)
|
|
The address
for Johnson & Johnson Innovation-JJDC, Inc. (“JJDC”) is 410 George Street, New Brunswick, New Jersey 08901. JJDC
has voting and dispositive power over 2,133,402 shares of common stock.
|
(6)
|
|
Amount represents
326,440 options that will be exercisable within 60 days of the Closing Date.
|
(7)
|
|
Amount represents
137,809 options that will be exercisable within 60 days of the Closing Date.
|
(8)
|
|
Amount represents
45,985 options that will be exercisable within 60 days of the Closing Date.
|
(9)
|
|
Amount represents
20,692 options that will be exercisable within 60 days of the Closing Date.
|
(10)
|
|
Amount represents
26,610 options that will be exercisable within 60 days of the Closing Date.
|
(11)
|
|
Represents 251,672 shares of Common Stock and warrants to purchase 276,190 shares of Common Stock. Mr. Amusa’s business
address is c/o Chardan Healthcare Acquisition Corp., 17 State Street, 21st Floor, New York, NY 10004.
|
(12)
|
|
See note (2) above
regarding shares beneficially owned by Jonas Grosssman.
|
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS
AND CONTROL PERSONS
Following the Closing, the Board of Directors
of the combined company was reconstituted and is now comprised of seven members, classified into three classes, each comprising
as nearly as possible one-third of the directors to serve three-year terms. As Class I directors, each of Yaron Breski, Erez Chimovits
and Robbie Woodman will serve until the 2020 annual meeting; as Class II directors, each of Gbola Amusa and Jonas Grossman will
serve until the 2021 annual meeting; and as Class III directors, each of Russell Greig and Jonathan Solomon will serve until the
2022 annual meeting, or in each case until their respective successors are duly elected and qualified, or until their earlier resignation,
removal or death.
The Company’s directors and executive
officers are:
Name
|
|
Age
|
|
Position
|
Jonathan Solomon
|
|
42
|
|
Chief Executive Officer and Director
|
Assaf Oron
|
|
44
|
|
Chief Business Officer
|
Sailaja Puttagunta
|
|
51
|
|
Chief Medical Officer
|
Merav Bassan
|
|
54
|
|
Chief Development Officer
|
Inbar Gahali-Sass
|
|
46
|
|
Vice President of Platform Research & Development
|
Myriam Golembo
|
|
54
|
|
Vice President of Development
|
Uri Ben-Or(1)
|
|
49
|
|
Interim Chief Financial Officer
|
Russell Greig
|
|
67
|
|
Director and Chairman of the Board
|
Gbola Amusa
|
|
45
|
|
Director
|
Yaron Breski
|
|
41
|
|
Director
|
Erez Chimovits
|
|
55
|
|
Director
|
Jonas Grossman
|
|
45
|
|
Director
|
Robbie Woodman
|
|
41
|
|
Director
|
(1)
|
Sigal Fattal, Chief
Financial Officer of BiomX, resigned from her role as the Chief Financial Officer, effective upon the consummation of the
Business Combination, and remains employed by BiomX as a consultant to the Chief Executive Officer. The Board of Directors
appointed Mr. Uri Ben-Or to join the Company as its Interim Chief Financial Officer, effective October 30,
2019.
|
Jonathan Solomon
has served as the Chief Executive Officer and as a director of the Company since October 2019. Mr. Solomon served as Chief Executive
Officer and director of BiomX from May 2017 to October 2019, and from February 2016 to May 2017, he served as a director of BiomX.
From July 2007 to December 2015, Mr. Solomon was a co-founder, President, and Chief Executive Officer of ProClara Biosciences Inc.
(formerly NeuroPhage Pharmaceuticals Inc.), a biotechnology company pioneering an approach to treating neurodegenerative diseases.
Prior to joining ProClara, he served for ten years in a classified military unit of the Israeli Defense Forces. Mr. Solomon holds
a B.Sc. magna cum laude in Physics and Mathematics from the Hebrew University, an M.Sc. summa cum laude in Electrical Engineering
from Tel Aviv University, and an M.B.A. with honors from the Harvard Business School.
Assaf Oron
has served as the Chief Business Officer of the Company since October 2019. Mr. Oron served as Chief Business Officer of BiomX
from January 2017 to October 2019. Prior to this position, he served in various roles at Evogene Ltd., an agriculture biotechnology
company, which utilizes a proprietary integrated technology infrastructure to enhance seed traits underlying crop productivity,
from March 2006 to December 2016, including Executive Vice President of Strategy and Business Development and Executive Vice President
of Corporate Development. Prior to joining Evogene, Mr. Oron served as Chief Executive Officer of ChondroSite Ltd., a biotechnology
company that develops engineered tissue products in the field of orthopedics and as a senior project manager and strategic consultant
at Israeli management consulting company POC Ltd. Mr. Oron holds an M.Sc. in Biology (bioinformatics) and a B.Sc. in Chemistry
and Economics, both from Tel Aviv University.
Dr. Sailaja Puttagunta
M.D. has served as the Chief Medical Officer of the Company since October 2019. Dr. Puttagunta served as the Chief Medical
Officer of BiomX from December 2018 to October 2019. Prior to joining BiomX, Dr. Puttagunta served as Vice President, Development
at Iterum Therapeutics plc, a clinical stage pharmaceutical company developing antibiotics against multi-drug resistant pathogens,
from January 2016 to December 2018. Prior to Iterum, Dr. Puttagunta served as VP, Medical Affairs for Anti-infectives at pharmaceutical
company Allergan plc from January 2015 to January 2016 and was the Vice President of Development and Medical Affairs from August
2014 to December 2014 and the Executive Director of Clinical and Medical Affairs from June 2012 through July 2014 at pharmaceutical
company Durata Therapeutics, Inc., an innovative pharmaceutical company focused on the development and commercialization of novel
therapeutics for patients with infectious diseases and acute illnesses, prior to its acquisition by Actavis plc. Prior to joining
Durata, Dr. Puttagunta led teams within clinical development and medical affairs on various antibiotic compounds at pharmaceutical
company Pfizer Inc. Dr. Puttagunta graduated from Gandhi Medical College in Hyderabad, India and completed her residency in Internal
Medicine and a fellowship in Infectious Diseases at Yale University School of Medicine. She also holds an M.S. in Biochemistry
from the New York University School of Medicine.
Dr. Merav Bassan
has served as the Chief Development Officer of the Company since October 2019. Dr. Bassan joined as Chief Development Officer of
BiomX in October 2019. Prior to this position, she served in various development roles at Teva Pharmaceutical Industries Limited
since 2005, including Vice President, Head of Translational Sciences, Specialty Clinical Development R&D since 2017, Vice President,
Pain and Global Internal Medicine, Project Leadership, Innovative Product Development, Global IR&D from 2015 to 2017, and Project
Champion, Senior Director, Innovative Product Development, Global IR&D from 2009 to 2015. Dr. Bassan holds a B.Sc. in Biology,
a M.Sc. in Human Genetics and a Ph.D. in Neurobiology from Tel Aviv University, and she completed a Post-Doctoral Fellowship in
Neuroscience at Harvard Medical School at Harvard University.
Dr. Inbar Gahali-Sass
has served as the Vice President of Platform Research & Development of the Company since October 2019. Dr. Gahali-Sass served
as Vice President of Platform Research & Development of BiomX from December 2018 to October 2019. Prior to joining BiomX, Dr.
Gahali-Sass served as Research & Development Manager at Omrix Biopharmaceuticals, Inc., a biotechnology company focused on
developing protein-based biosurgery and passive immunotherapy products and a subsidiary of Ethicon, Inc. and Johnson& Johnson,
from May 2012 through November 2018 and as a senior scientist from August 2006 to May 2012. Dr. Gahali-Sass holds a B.Sc. in Biology,
an M.Sc. in Microbiology, a Ph.D and a post-Doctoral degree in Microbiology from The Hebrew University, and an M.B.A. from the
College of Management Academic Studies.
Dr. Myriam Golembo
has served as the Vice President of Development of the Company since October 2019. Dr. Golembo served as the Vice President
of Development of BiomX from July 2017 to October 2019. Prior to this position, Dr. Golembo served as the Vice President of Regulatory
and Clinical Operations at Efranat Ltd., a biotechnology company focused on the development of cancer therapies, from May 2016
to June 2017. From May 2015 to May 2016, Dr. Golembo served as the Vice President of Development for Otic Pharma Ltd., a pharmaceutical
company focusing on the development of ear, nose, and throat products (now Novus Therapeutics, Inc.). Before joining Otic Pharma,
Dr. Golembo served as Director of Product Development at Protalix BioTherapeutics, Inc., a biopharmaceutical company manufacturing
a plant-based enzyme for the treatment of Gaucher disease, from May 2012 to May 2015 and as Associate Director of Products Development
from May 2009 to May 2012. Dr. Golembo holds a B.Sc. in Biology and an M.Sc. in Molecular Biology from The Hebrew University and
a Ph.D. in Molecular Genetics from Weizmann Institute of Science.
Uri
Ben-Or has served as the Interim Chief Financial Officer, effective October 30, 2019. In January 2007, Mr. Ben-Or founded
CFO Direct Ltd., in which he has served as the Chief Executive Officer and through which he provides his services to our
company. Mr. Ben-Or is currently the Chief Financial Officer of BiondVax Pharmaceuticals Ltd. (Nasdaq: BVXV), Together Pharma
Ltd. (TASE), Cannabics Pharmaceuticals Inc. (OTC: CNBX), Opectra Ltd. (TASE), Geffen Biomed Investments Ltd. (TASE), and
Medivie Therapeutic Ltd., and is the Chief Executive Officer and Chief Financial Officer of Maayan Ventures Ltd. (TASE). Mr.
Ben-Or was also the Chief Financial Officer of My Size Inc. (Nasdaq: MYSZ; TASE) from September 2010 to May 2016, Intercure
Ltd. (TASE) from February 2011 to January 2016, D. Medical Industries Ltd. (TASE) from February 2013 to April 2015, Therapix
Biosciences Ltd. from October 2014 to March 2015 (Nasdaq: TRPX), Procognia Ltd. (TASE) from September 2012 to December 2014,
Glycominds Ltd. (TASE) from October 2001 to April 2014, and WideMed Ltd. (TASE) from November 2007 to November 2010. Prior to
that, Mr. Ben-Or was an auditor at PriceWaterhouseCoopers from May 1997 to July 1999. Mr. Ben-Or holds a B.A. in Accounting
from The College of Management Academic Studies, and an M.B.A. from Bar-Ilan University and is a certified public accountant
in Israel.
Dr. Russell Greig
has served as a director and chairman of the Board of Directors of the Company since October 2019. Dr. Greig has more than 35 years’
experience in the pharmaceutical industry, with knowledge and expertise in research and development, business development and commercial
operations. He spent the majority of his career at GlaxoSmithKline (“GSK”), where he held a number of positions including
GSK’s President of Pharmaceuticals International from 2003 to 2008 and Senior Vice President Worldwide Business Development.
From 2008 to 2010, Dr. Greig was also President of SR One, GSK’s Corporate Venture Group. He is currently Chairman of AM
Pharma and Mint Solutions in The Netherlands, and Bionor in Norway. In addition, Dr. Greig serves as a board member of Onxeo S.A.
in France, and previously served on the boards of Tigenix N.V. (acquired by Takeda Pharmaceutical Company Limited), and Ablynx
N.V. (acquired by Sanofi, France). He is also a Venture Partner at Kurma Life Sciences (France). He was previously Chairman of
Syntaxin Ltd (UK) (sold to Ipsen), Novagali Pharma S.A. (France) (acquired by Santen Pharmaceutical Co., Ltd.), and Isconova AB
(Sweden) (acquired by Novavax, Inc. (Nasdaq:NVAX)). He served as acting Chief Executive Officer at Genocea Biosciences (Nasdaq:
GNCA) and Isconova AB for an interim period. He was also a member of the Scottish Scientific Advisory Committee, reporting to the
First Minister of Scotland.
Dr. Gbola Amusa
has served as a director of the Company since March 2018, and served as the Executive Chairman of CHAC from March 2018 to October
2019. Dr. Amusa has served as Partner, Director of Research, and Head of Healthcare Equity Research at Chardan Capital Markets
LLC since December 2014. At Chardan, he has established the healthcare vision by focusing on disruptive healthcare segments, such
as gene therapy/genetic medicines, that have the highest potential for significant investment returns. Dr. Amusa was previously
Managing Director, Head of European Pharma Research, and Global Pharma& Biotech Coordinator at UBS (from 2007 to 2013), where
he oversaw 25 analysts. Prior to UBS, Dr. Amusa was a Senior Research Analyst and Head of European Pharma research at Sanford Bernstein.
He started his career in finance at Goldman Sachs as an Associate in the Healthcare Investment Banking Group, where he worked on
large transactions including the Amgen/Immunex merger. Additionally, Dr. Amusa was previously a Healthcare Finance & Strategy
Consultant working with governments, companies, leading foundations and think tanks. He holds an M.D. from Washington University
Medical School, an M.B.A. with High Honors from the University of Chicago Booth School of Business, and a B.S.E. with Honors from
Duke University.
Yaron Breski
has served as a director of the Company since October 2019, and served on the Board of Directors of BiomX from November 2018 to
October 2019. Mr. Breski is a Partner at RMGP Bio-Pharma Investment Fund, L.P., which he co-founded in May 2017, and has served
as Managing Director at RM Global Partners LLC since October 2014. Previously, Mr. Breski served as Executive Director of Business
Development at biotechnology company Rosetta Genomics. Mr. Breski holds a B.Sc. in Biology, Magna Cum Laude, research track for
honors students from the Tel Aviv University; and an M.B.A from The Wharton School, University of Pennsylvania.
Erez Chimovits
has served as a director of the Company since October 2019, and served on the Board of Directors of BiomX from January 2016 to
October 2019. Mr. Chimovits has served as Senior Managing Director at healthcare investment firm OrbiMed Advisors LLC since 2010.
Prior to joining OrbiMed, Mr. Chimovits was the Chief Executive Officer of pharmaceutical company NasVax Ltd. (now Therapix Biosciences
Ltd.) and spent more than seven years with predictive drug discovery and development company Compugen Ltd., serving as President
of Compugen USA Inc. and as Executive Vice President of Commercial Operations. Mr. Chimovits earned his M.B.A., M.Sc. in Microbiology,
and B.Sc. from Tel Aviv University.
Jonas Grossman
has served as a director of the Company since October 2019, and served on the Board of Directors of CHAC from its formation in
November 2017 to October 2019. Mr. Grossman has served as Partner and Head of Capital Markets for Chardan Capital Markets LLC,
a New York headquartered broker/dealer, since December 2003. Mr. Grossman has served as President of Chardan Capital Markets LLC
since September 2015. Since 2003, Mr. Grossman has overseen the firm’s deal origination, syndication, secondary market sales
and trading and corporate access initiatives. He has extensive transactional experience having led or managed over 400 transactions
during his tenure at Chardan. Since December 2006, Mr. Grossman has served as a founding partner for Cornix Advisors, LLC, a New
York based hedge fund. From 2001 until 2003, Mr. Grossman worked at Ramius Capital Group, LLC, a global multi-strategy hedge fund
where he served as Vice President and Head Trader. Mr. Grossman has served as a director for China Broadband (NASDAQ: SSC) from
January 2008 until November 2010. He holds a B.A. in Economics from Cornell University and an M.B.A. from NYU’s Stern School
of Business.
Dr. Robbie Woodman
has served as a director of the Company since October 2019, and served on the Board of Directors of BiomX from June 2018 to October
2019. Dr. Woodman joined Takeda Ventures, Inc. (“TVI”) in March 2018 as Senior Partner. Prior to joining TVI, Dr. Woodman
served as Director of Healthcare Investments at venture capital and private equity firm Touchstone Innovations Plc (formerly Imperial
Innovations) from December 2012 to January 2017 and as Director of Healthcare Ventures from September 2012 through December 2016.
Dr. Woodman previously served as Principal in the life science team at venture capital firm Sofinnova Partners. Dr. Woodman holds
an M.Sc. in Biochemistry from the University of Oxford and a Ph.D. in Oncology from the University of Cambridge.
Director Independence
The
NYSE American Stock Exchange requires that a majority of our Board of Directors be composed of “independent directors,”
which is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual
having a relationship, which, in the opinion of the company’s Board of Directors would interfere with the director’s
exercise of independent judgment in carrying out the responsibilities of a director.
Messrs.
Gbola Amusa, Yaron Breski, Erez Chimovits, Dr. Russell Greig, Jonas Grossman and Dr. Robbie Woodman are our independent directors.
Our independent directors have regularly scheduled meetings at which only independent directors are present.
Committees of the Board of Directors
Audit Committee
The Audit Committee,
which is established in accordance with Section 3(a)(58)(A) of the Exchange Act, engages Company’s independent accountants,
reviewing their independence and performance; reviews the Company’s accounting and financial reporting processes and the
integrity of its financial statements; the audits of the Company’s financial statements and the appointment, compensation,
qualifications, independence and performance of the Company’s independent auditors; the Company’s compliance with legal
and regulatory requirements; and the performance of the Company’s internal audit function and internal control over financial
reporting. The Audit Committee has held three meetings during 2019.
The members of the
Audit Committee are Gbola Amusa, Yaron Breski and Erez Chimovits, each of whom is an independent director under NYSE American Stock
Exchange’s listing standards and satisfies the additional independence requirements of Rule 10A-3 of the Exchange Act. Gbola
Amusa is the Chairperson of the Audit Committee. The Board of Directors has determined that Gbola Amusa qualifies as an “audit
committee financial expert,” as defined under the rules and regulations of the SEC.
Compensation Committee
The
Compensation Committee reviews annually the Company’s corporate goals and objectives relevant to the officers’ compensation,
evaluates the officers’ performance in light of such goals and objectives, determines and approves the officers’ compensation
level based on this evaluation; makes recommendations to the Board of Directors regarding approval, disapproval, modification,
or termination of existing or proposed employee benefit plans, makes recommendations to the Board of Directors with respect to
the compensation of our executive officers, other than the Chief Executive Officer, and administers the Company’s incentive-compensation
plans and equity-based plans. The Compensation Committee has the authority to delegate any of its responsibilities to subcommittees
as it may deem appropriate in its sole discretion. The Chief Executive Officer of the Company may not be present during voting
or deliberations of the Compensation Committee with respect to his compensation. The Company’s executive officers do not
play a role in suggesting their own salaries. Neither the Company nor the Compensation Committee has engaged any compensation consultant
who has a role in determining or recommending the amount or form of executive or director compensation. The Compensation Committee
has not held any meetings during 2019.
The members of the
Compensation Committee are Erez Chimovits, Jonas Grossman and Russell Greig, each of whom is an independent director under NYSE
American Stock Exchange’s listing standards. Erez Chimovits is the Chairperson of the Compensation Committee.
Nominating Committee
The Nominating Committee
is responsible for overseeing the selection of persons to be nominated to serve on our Board of Directors. Specifically, the Nominating
Committee makes recommendations to the Board of Directors regarding the size and composition of the Board of Directors, establishes
procedures for the director nomination process and screens and recommends candidates for election to the Board of Directors. On
an annual basis, the Nominating Committee recommends for approval by the Board of Directors certain desired qualifications and
characteristics for Board of Directors membership. Additionally, the Nominating Committee establishes and oversees the annual assessment
of the performance of the Board of Directors as a whole and its individual members. The Nominating Committee will consider a number
of qualifications relating to management and leadership experience, background and integrity and professionalism in evaluating
a person’s candidacy for membership on the Board of Directors. The Nominating Committee may require certain skills or attributes,
such as financial or accounting experience, to meet specific needs of the Board of Directors that arise from time to time and will
also consider the overall experience and makeup of its members to obtain a broad and diverse mix of Board of Directors members.
The Nominating Committee does not distinguish among nominees recommended by stockholders and other persons. The Nominating Committee
has not held any meetings during 2019.
The members of the
Nominating Committee are Russell Greig, Jonas Grossman and Robbie Woodman, each of whom is an independent director under NYSE American
Stock Exchange’s listing standards. Russell Greig is the Chairperson of the Nominating Committee.
DIRECTOR COMPENSATION
In connection with
the Closing of the Merger Agreement, the Board of Directors intends to approve and implement a compensation program that will consist
of annual retainer fees and long-term equity awards for our non-employee directors.
EXECUTIVE COMPENSATION
The disclosure contained
in the Definitive Proxy Statement in the section entitled “Compensation of Directors and Executive Officers of BiomX”
beginning on page 204 is incorporated herein by reference.
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS
Certain transactions
of CHAC and BiomX are described in the Definitive Proxy Statement in the section entitled “Certain Transactions”
beginning on page 209 and are incorporated herein by reference.
In connection with
the Closing, the Company adopted a new related party transactions approval policy that sets forth the policies and procedures for
the review and approval or ratification of related person transactions.
As discussed above
in Item 1.01, on October 28, 2019, CHAC entered into a purchase agreement with Cornix, an affiliate of CHAC. For further discussion,
see Item 1.01.
DESCRIPTION OF SECURITIES
The disclosure contained
in the Definitive Proxy Statement in the section entitled “Description of CHAC’s Securities” beginning
on page 211 is incorporated herein by reference.
LEGAL PROCEEDINGS
From time to time,
the Company may be involved in various claims and legal proceedings arising in the ordinary course of business. Neither the Company
nor BiomX is currently a party to any such claims or proceedings which, if decided adversely to the Company or BiomX, would either,
individually or in the aggregate, have a material adverse effect on the Company’s business, financial condition, results
of operations or cash flows.
INDEMNIFICATION OF DIRECTORS AND
OFFICERS
The information
contained in Item 14 of CHAC’s Registration Statement on Form S-1 (File No. 333-228533), as originally filed with the Securities
and Exchange Commission (“SEC”) on November 26, 2018, as amended, is incorporated herein by reference.
In addition, upon
the Closing, the Company has entered into indemnification agreements with each of its directors and executive officers. These agreements
require the Company to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that
may arise by reason of their service to the Company, and to advance expenses incurred as a result of any proceeding against them
as to which they could be indemnified.
The Form of the
Indemnification Agreement is filed with this Form 8-K as Exhibit 10.4 and is incorporated herein by reference. The foregoing description
of the Form of the Indemnification Agreement does not purport to be complete and is subject to, and is qualified in its entirety
by, the full text of the Form of the Indemnification Agreement.