UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

 

Washington, D.C. 20549

 

    

FORM 8-K

   

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): December 21, 2017

 

 

BIOSTAGE, INC.

(Exact name of registrant as specified in its charter)

 

Delaware 001-35853 45-5210462
(State or other jurisdiction
of incorporation)  		(Commission File Number)  (IRS Employer Identification No.) 

 

84 October Hill Road, Suite 11, Holliston, MA 01746
(Address of principal executive offices) (Zip Code)

 

Registrant's telephone number, including area code:   (774) 233-7300

 

 

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

 

 

 

 

Item 3.03. Material Modification to Rights of Security Holders.

 

The information set forth in Item 5.03 is incorporated herein by reference.

 

Item 5.03. Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.

 

On December 22, 2017, Biostage, Inc. (the “Company”) effected a reverse stock split of its shares of common stock, par value $0.01 per share (the “Common Stock”) at a ratio of 1-for-20 (the “Reverse Split”). The Common Stock will begin trading on the OTCQB marketplace on a reverse stock split-adjusted basis at the open of the market on December 22, 2017.

 

Upon the commencement of trading on December 22, 2017, the Company's symbol on the OTCQB marketplace will change to “BSTGD” for a period of 20 business days, after which the "D" will be removed from the Company's trading symbol, which will revert to the original symbol of "BSTG". In connection with the Reverse Split, the CUSIP number for the Common Stock has been changed to 09074M202.

 

The Reverse Split was previously authorized at the annual meeting of the Company’s stockholders on April 26, 2017, and the Company’s Board of Directors approved the ratio and timing of the Reverse Split on December 11, 2017. The requisite Certificate of Amendment to the Company’s Amended and Restated Certificate of Incorporation was filed with the Delaware Secretary of State on December 21, 2017, with an effective time of 12:01 a.m. on December 22, 2017.

 

As previously disclosed, the Company entered into a binding Memorandum of Understanding (the “MOU”) with Bin Zhao (including such investor’s designees, the “Investors”), pursuant to which the Company will issue to the Investors in a private placement (the “Private Placement”) 40,000,000 shares of its common stock at a purchase price of $0.10 per share or, to the extent the Investors, following the transaction, would own more than 49.99% of the Company’s common stock, shares of a new class of preferred stock of the Company (the “Preferred Stock”) with a per-share purchase price of $1,000. Consummation of the Reverse Split is a condition to closing the Private Placement, as set forth in the MOU.

 

As a result of the Reverse Split, the Company’s issued and outstanding shares of Common Stock will decrease to approximately 2.0 million post-split shares (prior to effecting the rounding of fractional shares into whole shares as described below) from approximately 39.8 million pre-split shares. As a result of the Reverse Split, the total number of shares of Common Stock held by each stockholder will be converted automatically into the number of whole shares of Common Stock equal to (i) the number of shares of common stock held by the stockholder immediately prior to the Reverse Split, divided by (ii) 20.

 

No fractional shares will be issued. Instead, the Company will pay cash to any stockholder holding fractional shares as a result of the Reverse Split equal to such fraction multiplied by $1.32, which represents the closing price per share of $0.066 for the Common Stock on the OTCQB marketplace as of December 21, 2017, as adjusted to reflect the Reverse Split.

 

The par value and other terms of the Common Stock will not be affected by the Reverse Split. The authorized capital of the Company of 120,000,000 shares of Common Stock and 2,000,000 shares of preferred stock also will not be affected by the Reverse Split.

 

The Company has retained its transfer agent, Computershare, to act as exchange agent for the Reverse Split. Computershare will manage the exchange of pre-split shares for post-split shares. Stockholders of record will receive a letter of transmittal providing instructions for the exchange of their shares. Stockholders who hold their shares in street name will be contacted by their banks or brokers with any instructions. For further information, stockholders and securities brokers should contact Computershare at (800) 522-6645.

 

All options and warrants of the Company outstanding immediately prior to the Reverse Split will be appropriately adjusted. In general, the Reverse Split will effect a reduction in the number of shares of Common Stock subject to such outstanding stock options and warrants proportional to the exchange ratio of the Reverse Split and will effect a proportionate increase in the exercise price of such outstanding options and warrants.

 

 

 

 

Item 8.01. Other Events.

 

On December 22, 2017, the Company issued a press release announcing the Reverse Split. The full text of the press release is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information in this Item 8.01 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the United States Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit
Number 		  Title
3.1   Amendment to Amended and Restated Certificate of Incorporation, filed December 21, 2017.
99.1   Press Release issued by Biostage, Inc. on December 22, 2017.

 

 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

    BIOSTAGE, INC.
    (Registrant)
     
December 22, 2017   /s/   Thomas McNaughton
(Date)   Thomas McNaughton
Chief Financial Officer

 

 

 

INDEX TO EXHIBITS

 

Exhibit

Number  

 

  Description of Exhibit
3.1     Amendment to Amended and Restated Certificate of Incorporation, filed December 21, 2017.
99.1     Press Release issued by Biostage, Inc. on December 22, 2017.

 

 

Exhibit 3.1

 

CERTIFICATE OF AMENDMENT

TO THE AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

 

Pursuant to Section 242 of the General Corporation Law of the State of Delaware

 

 

Biostage, Inc., formerly known as Harvard Apparatus Regenerative Technology, Inc., a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware (the “Corporation”), hereby certifies as follows:

 

FIRST:   The name of the Corporation is Biostage, Inc.

 

SECOND:   The date on which the Certificate of Incorporation of the Corporation was originally filed with the Secretary of State of the State of Delaware is May 3, 2012, and was amended and restated by the Amended and Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on March 28, 2013, as amended by (i) a Certificate of Amendment to the Amended and Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on March 30, 2016 and effective as of March 31, 2016, (ii) a certificate of Amendment to the Amended and Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on May 26, 2016 and effective as of that date and (iii) a certificate of Amendment to the Amended and Restated Certificate of Incorporation filed with the Secretary of State of the State of Delaware on April 26, 2017 and effective as of that date (as amended, the “Certificate”).

 

THIRD:   The Corporation hereby amends the Certificate as follows:

 

The section entitled “COMMON STOCK” in ARTICLE IV.A of the Certificate is hereby amended by adding the following paragraph at the end of such section:

 

“Upon the effectiveness of this Certificate of Amendment to the Amended and Restated Certificate of Incorporation of the Corporation, each twenty (20) shares of Common Stock issued and outstanding at such time shall, automatically and without any further action on the part of the Corporation or the holder thereof, be combined into one (1) validly issued, fully paid and non-assessable share of Common Stock (the “Reverse Stock Split”). The par value of the Common Stock following the Reverse Stock Split shall remain $0.01 per share. No fractional shares shall be issued, and, in lieu thereof, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of a share of Common Stock, as determined by the Board of Directors. Each certificate that immediately prior to the Effective Time represented shares of Common Stock (an “Old Certificate”) shall thereafter represent that number of shares of Common Stock into which the shares of Common Stock represented by the Old Certificate shall have been combined, subject to the elimination of fractional share interests as described above.”

 

FOURTH:   This Certificate of Amendment has been duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.

 

FIFTH: The Certificate of Amendment shall be effective on December 22, 2017 at 12:01 am ET.

 

IN WITNESS WHEREOF, Biostage, Inc. has caused this Certificate of Amendment to be signed by its chief executive officer this 21st day of December, 2017.

 

  BIOSTAGE, INC.
     
  By: /s/ James McGorry
    James McGorry, Chief Executive Officer

 

 

Exhibit 99.1

 

 

 

Biostage Announces Reverse Stock Split Effective December 22, 2017

 

– Required for financing agreement –

 

– Reverse split ratio of 1-for-20 –

 

Holliston, MA, December 22, 2017 – Biostage, Inc. (OTCQB: BSTG), ("Biostage" or the "Company"), a biotechnology company developing bioengineered organ implants to treat cancers and other life-threatening conditions of the esophagus, bronchus and trachea, today announced a reverse stock split of its shares of common stock at a ratio of 1-for-20. The Company's common stock will begin trading on a post-split basis on Friday, December 22, 2017. Upon the commencement of trading on December 22, 2017, the Company's symbol on the OTCQB marketplace will change to “BSTGD” for a period of 20 business days, after which the "D" will be removed from the Company's trading symbol, which will revert to the original symbol of "BSTG". In connection with the reverse stock split, the CUSIP number for the common stock has been changed to 09074M202.

 

The reverse stock split was implemented by the Company in order to satisfy a condition to closing pursuant to the binding Memorandum of Understanding (the “MOU”) entered into between the Company and a private investor on December 11, 2017 for the private placement of shares of the Company’s common stock, or a convertible preferred equivalent, and warrants to purchase shares of the Company’s common stock, or a convertible preferred equivalent, for gross proceeds of approximately $4.0 million.

 

Jim McGorry, CEO of Biostage stated, “The implementation of this reverse stock split is a significant step in moving Biostage closer towards funding and closing the private placement, which we expect will allow us to re-establish normal operations at a more efficient size and structure and fund the promise of our technology.”

The reverse stock split was previously authorized at the annual meeting of the Company’s stockholders on April 26, 2017, and the Company’s Board of Directors approved the ratio and timing of the reverse stock split on December 11, 2017. The reverse stock split became effective at 12:01 a.m. on December 22, 2017.

 

As a result of the reverse stock split, the total number of shares of common stock held by each stockholder will be converted automatically into the number of whole shares of common stock equal to (i) the number of shares of common stock held by the stockholder immediately prior to the reverse stock split, divided by (ii) 20. As a result of the reverse stock split, the Company’s issued and outstanding shares of common stock will decrease to approximately 2.0 million post-split shares (prior to effecting the rounding of fractional shares into whole shares as described below) from approximately 39.8 million pre-split shares.

 

No fractional shares will be issued. Instead, the Company will pay cash to any stockholder holding fractional shares as a result of the reverse stock split equal to such fraction multiplied by $1.32, which represents the closing price per share of $0.066 for the common stock on the OTCQB marketplace as of December 21, 2017, as adjusted to reflect the reverse stock split.

 

The par value and other terms of the common stock will not be affected by the reverse stock split. The authorized capital of the Company of 120,000,000 shares of common stock and 2,000,000 shares of preferred stock also will not be affected by the reverse stock split.

 

The Company has retained its transfer agent, Computershare, to act as exchange agent for the reverse stock split . Computershare will manage the exchange of pre-split shares for post-split shares. Stockholders of record will receive a letter of transmittal providing instructions for the exchange of their shares. Stockholders who hold their shares in street name will be contacted by their banks or brokers with any instructions. For further information, stockholders and securities brokers should contact Computershare at (800) 522-6645.

 

All options and warrants of the Company outstanding immediately prior to the reverse stock split will be appropriately adjusted. In general, the reverse stock split will effect a reduction in the number of shares of common stock subject to such outstanding stock options and warrants proportional to the exchange ratio of the reverse stock split and will effect a proportionate increase in the exercise price of such outstanding options and warrants.

 

 

 

 

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor may there be any sale of any securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

 

About Biostage

 

Biostage is a biotechnology company developing bioengineered organ implants based on the Company's Cellframe ™ technology which combines a proprietary biocompatible scaffold with a patient's own stem cells to create Cellspan organ implants. Cellspan implants are being developed to treat life-threatening conditions of the esophagus, bronchus or trachea with the hope of dramatically improving the treatment paradigm for patients. Based on its preclinical data, Biostage has selected life-threatening conditions of the esophagus as the initial clinical application of its technology.

 

For more information, please visit www.biostage.com and connect with the Company on Twitter and LinkedIn.

 

Forward-Looking Statements:

 

Some of the statements in this press release are "forward-looking" and are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These "forward-looking" statements in this press release include, but are not limited to, statements relating to the reverse stock split, the private placement, including the closing and funding thereof, development expectations and regulatory approval of any of the Company’s products, including those utilizing its Cellframe technology, by the U.S. Food and Drug Administration, the European Medicines Agency or otherwise, which closings, expectations or approvals may not be achieved or obtained on a timely basis or at all; or success with respect to any collaborations, clinical trials and other development and commercialization efforts of the Company’s products, including those utilizing its Cellframe technology, which such success may not be achieved or obtained on a timely basis or at all. These statements involve risks and uncertainties that may cause results to differ materially from the statements set forth in this press release, including, among other things, whether the reverse stock split will be beneficial to the Company and its stockholders, the Company’s ability to obtain the funding necessary for ongoing operations, the Company’s ability to obtain and maintain regulatory approval for its products and the Company’s ability to complete the private placement on a timely basis or at all; plus other factors described under the heading "Item 1A. Risk Factors" in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016 or described in the Company’s other public filings. The Company’s results may also be affected by factors of which the Company is not currently aware. The forward-looking statements in this press release speak only as of the date of this press release. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to such statements to reflect any change in its expectations with regard thereto or any changes in the events, conditions or circumstances on which any such statement is based.

 

Investor Relations Contacts:

 

Tom McNaughton

Chief Financial Officer

774-233-7321

tmcnaughton@biostage.com