UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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 reported): April 30, 2021

 

Novo Integrated Sciences, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada   001-40089   59-3691650
(State or other jurisdiction   (Commission   (IRS Employer
of Incorporation)   File Number)   Identification Number)

 

11120 NE 2nd Street, Suite 100, Bellevue, WA 98004

(Address of principal executive offices)

 

(206) 617-9797

(Registrant’s telephone number, including area code)

 

N/A

(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 (see General Instruction A.2.)

 

[  ] 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 CF$ 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class   Trading Symbol(s)   Name of Each Exchange on which Registered
Common Stock, $0.001 par value   NVOS   The Nasdaq Stock Market LLC

 

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 [  ]

 

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 8.01. Other Events.

 

Extension of Acenzia Non-Binding Letter of Intent

 

As previously disclosed by Novo Integrated Sciences, Inc. (“Novo”) in its Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on April 6, 2021 (the “April Form 8-K”), on December 18, 2020, Novo and Novo Healthnet Limited, a wholly owned subsidiary of Novo (“NHL” and together with Novo, the “Company”), entered into a non-binding letter of intent (“Acenzia LOI”) with Acenzia Inc. (“Acenzia”) and each of the Acenzia shareholders (collectively, the “Acenzia Shareholders”). Pursuant to the terms of the Acenzia LOI, the parties agreed to proceed reasonably and in good faith toward the negotiation and execution of a share exchange or similar definitive agreement regarding the acquisition of Acenzia by the Company. The parties expect that the definitive agreement will provide for the acquisition of Acenzia in exchange for $25,000,000, subject to Acenzia’s valuation affirmed by a mutually acceptable certified independent third party valuation analyst, in Novo restricted common stock, NHL exchangeable preferred shares, or other equity structure depending on tax considerations.

 

Pursuant to the terms of the Acenzia LOI, if a definitive agreement was not executed by the parties to the Acenzia LOI on or before March 1, 2021, the terms of the Acenzia LOI would terminate, with the exception of certain specified provisions. As previously disclosed in the April Form 8-K, on March 1, 2021, the parties amended the Acenzia LOI to extend the termination date of the Acenzia LOI to May 1, 2021.

 

On April 30, 2021, the parties amended the Acenzia LOI to extend the termination date of the Acenzia LOI to June 1, 2021.

 

Extension of Pouch Works LLC Non-Binding Letter of Intent

 

As previously disclosed by Novo in the April Form 8-K, on December 21, 2020, Acenzia, Pro-Dip LLC (“Pro-Dip”) and Pouch Works LLC, a subsidiary of Pro-Dip (“Pouch Works” and together with Pro-Dip, the “Pro-Dip Parties”), entered into a non-binding letter of intent (the “Pro-Dip LOI”) pursuant to which the parties agreed to proceed reasonably and in good faith toward the negotiation and execution of definitive documentation regarding the acquisition by Acenzia of 100% interest in Pro-Dip (including Pouch Works) in exchange for $800,000 of Acenzia capital stock, subject to the Pro-Dip Parties’ valuation affirmed by a mutually acceptable independent third party valuation analyst, or other share structure depending on tax considerations. Also as previously disclosed in the April Form 8-K, on January 27, 2021, Novo, Acenzia and Pro-Dip executed an Agreement to Assign pursuant to which Acenzia transferred and assigned to Novo all rights and obligations under the Pro-Dip LOI.

 

Pursuant to the terms of the Pro-Dip LOI, if a definitive agreement was not executed by the parties to the Pro-Dip LOI on or before March 1, 2021, the terms of the Pro-Dip LOI would terminate, with the exception of certain specified provisions. On March 1, 2021, Acenzia and the Pro-Dip Parties agreed to amend the Pro-Dip LOI to extend the termination date of the Pro-Dip LOI to May 1, 2021.

 

On April 30, 2021, Novo and Pro-Dip amended the Pro-Dip LOI to extend the termination date of the Pro-Dip LOI to June 1, 2021.

 

Formation of Compensation Committee

 

On May 5, 2021, Novo’s Board of Directors (the “Board”) formed a Compensation Committee and named each of Alex Flesias, Robert Oliva and Michael Gaynor to serve as members thereof. Mr. Oliva will serve as Chair of the Compensation Committee.

 

Upon initially listing with the Nasdaq Capital Market (“Nasdaq”), Novo qualified as a “controlled company” because more than 50% of the voting power for the election of directors was held indirectly by Robert Mattacchione, Novo’s Chief Executive Officer. Subsequent to Novo’s registered direct offering that closed on April 13, 2021, Novo ceased to be a controlled company as Mr. Mattacchione no longer owned 50% or more of Novo’s voting power. The Nasdaq rules provide, among other things, that a company that has ceased to be a controlled company is permitted to phase-in its independent nominating and compensation committees as follows: (1) one member must satisfy the independence requirement at the time the company ceases to be a controlled company; (2) a majority of members must satisfy the independence requirement within 90 days of the company ceasing to be a controlled company; and (3) all members must satisfy the independence requirement within one year of the company ceasing to be a controlled company. Messrs. Flesias and Oliva qualify as independent directors. Mr. Gaynor is not an independent director. In order to comply with Nasdaq rules, Novo expects to replace Mr. Gaynor as a member of the Compensation Committee with an independent director within one year of Novo ceasing to be a controlled company.

 

 
 

 

A copy of the Compensation Committee Charter is filed as Exhibit 99.1 to this Current Report on Form 8-K.

 

Formation of Nominating and Corporate Governance Committee

 

Also on May 5, 2021, the Board formed a Nominating and Corporate Governance Committee and named each of Alex Flesias, Robert Oliva and Christopher David to serve as members thereof. Mr. Flesias will serve as Chair of the Nominating and Corporate Governance Committee.

 

Messrs. Flesias and Oliva qualify as independent directors. Mr. David is not an independent director. In order to comply with Nasdaq rules, Novo expects to replace Mr. David as a member of the Nominating and Corporate Governance Committee with an independent director within one year of Novo ceasing to be a controlled company.

 

A copy of the Nominating and Corporate Governance Committee Charter is filed as Exhibit 99.2 to this Current Report on Form 8-K.

 

Forward-Looking Statements

 

This Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this report are forward-looking statements. In some cases, forward-looking statements can be identified by words such as “believe,” “intend,” “expect,” “anticipate,” “plan,” “potential,” “continue,” “will,” “ would” or similar expressions. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company’s filings with the Securities and Exchange Commission. Investors should not place any undue reliance on forward-looking statements since they involve known and unknown, uncertainties and other factors which are, in some cases, beyond the Company’s control which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects the Company’s current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to operations, results of operations, growth strategy and liquidity. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.   Description
     
99.1   Compensation Committee Charter.
99.2   Nominating and Corporate Governance Committee Charter.

 

 
 

 

SIGNATURE

 

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

 

  Novo Integrated Sciences, Inc.
     
Dated: May 6, 2021 By: /s/ Robert Mattacchione
    Robert Mattacchione
    Chief Executive Officer

 

 

 

 

 

Exhibit 99.1

 

Exhibit A

 

 

CHARTER OF THE COMPENSATION COMMITTEE OF

 

NOVO INTEGRATED SCIENCES, INC.

 

Membership

 

The Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of Novo Integrated Sciences, Inc. (the “Company”) shall consist of three (3) or more directors. Each member of the Committee shall be independent in accordance with the provisions of Rule 10C-1(b)(1) under Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules of the NASDAQ Stock Market or any other securities exchange on which any of the Company’s securities are listed, subject to the phase-in periods permitted under the rules of the NASDAQ Stock Market under which the Committee is required to have only one independent member at the time of ceasing to be a Controlled Company, a majority of independent members within 90 days of ceasing to be a Controlled Company and all independent members within one year of ceasing to be a Controlled Company.

 

The members of the Committee shall be appointed by the Board, based on recommendations from the Nominating and Corporate Governance Committee of the Board (except for the Committee’s first three members). The members of the Committee shall serve for such term or terms as the Board may determine or until earlier resignation or death. The Board may remove any member from the Committee at any time with or without cause.

 

Purpose

 

The purpose of the Committee is to carry out the responsibilities delegated by the Board relating to the review and determination of executive compensation.

 

Duties and Responsibilities

 

The Committee shall have the following authority and responsibilities:

 

To review and approve the compensation of the Chief Executive Officer (“CEO”). In evaluating and determining CEO compensation, the Committee shall consider the results of the most recent stockholder advisory vote on executive compensation (“Say on Pay Vote”) required by Section 14A of the Exchange Act. The CEO cannot be present during any voting or deliberations by the Committee on his or her compensation.

 

To approve the compensation of all other executive officers. In evaluating and determining executive compensation, the Committee shall consider the results of the most recent Say on Pay Vote.

 

To review, and approve and, when appropriate, recommend to the Board for approval, any employment agreements and any severance arrangements or plans, including any benefits to be provided in connection with a change in control, for the CEO and other executive officers, which includes the ability to adopt, amend and terminate such agreements, arrangements or plans.

 

 
 

 

To review the Company’s incentive compensation arrangements to determine whether they encourage excessive risk-taking, to review and discuss at least annually the relationship between risk management policies and practices and compensation, and to evaluate compensation policies and practices that could mitigate any such risk.

 

To review and recommend to the Board for approval the frequency with which the Company will conduct Say on Pay Votes, taking into account the results of the most recent stockholder advisory vote on frequency of Say on Pay Votes required by Section 14A of the Exchange Act, and review and approve the proposals regarding the Say on Pay Vote and the frequency of the Say on Pay Vote to be included in the Company’s proxy statement.

 

To review director compensation for service on the Board and Board committees at least once a year and to recommend any changes to the Board.

 

Structure and Operations

 

The Board shall designate a member of the Committee as the Chairperson. The Committee shall meet at least two (2) times a year at such times and places as it deems necessary to fulfill its responsibilities. The Committee shall report regularly to the Board regarding its actions and make recommendations to the Board as appropriate. The Committee is governed by the same rules regarding meetings (including meetings in person or by telephone or other similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the Board.

 

The Committee may invite such members of management to its meetings as it deems appropriate. However, the Committee shall meet regularly without such members present, and in all cases the CEO and any other such officers shall not be present at meetings at which their compensation or performance is discussed or determined.

 

The Committee shall review this Charter at least annually and recommend any proposed changes to the Board for approval.

 

Delegation of Authority

 

The Committee shall have the authority to delegate any of its responsibilities, along with the authority to take action in relation to such responsibilities, to one or more subcommittees as the Committee may deem appropriate in its sole discretion.

 

ADOPTED: This 5th day of May, 2021

 

 

 

 

 

Exhibit 99.2

 

Exhibit B

 

 

CHARTER OF THE NOMINATING AND

 

CORPORATE GOVERNANCE COMMITTEE OF

 

NOVO INTEGRATED SCIENCES, INC.

Membership

 

The Nominating and Corporate Governance Committee (the “Committee”) of the Board of Directors (the “Board”) of Novo Integrated Sciences, Inc. (the “Company”) shall consist of three (3) or more directors. Each member of the Committee shall be independent in accordance with the provisions of Rule 10C-1(b)(1) under Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules of the NASDAQ Stock Market or any other securities exchange on which any of the Company’s securities are listed, subject to the phase-in periods permitted under the rules of the NASDAQ Stock Market under which the Committee is required to have only one independent member at the time of ceasing to be a Controlled Company, a majority of independent members within 90 days of ceasing to be a Controlled Company and all independent members within one year of ceasing to be a Controlled Company.

 

The members of the Committee shall be appointed by the Board, based on recommendations from the Nominating and Corporate Governance Committee of the Board (except for the Committee’s first three members). The members of the Committee shall serve for such term or terms as the Board may determine or until earlier resignation or death. The Board may remove any member from the Committee at any time with or without cause.

 

Purpose

 

The purpose of the Committee is to carry out the responsibilities delegated by the Board relating to the Company’s director nominations process and procedures, developing and maintaining the Company’s corporate governance policies and any related matters required by federal securities laws.

 

Duties and Responsibilities

 

The Committee shall have the following authority and responsibilities:

 

a. To determine the qualifications, qualities, skills, and other expertise required to be a director and to develop, and recommend to the Board for its approval, criteria to be considered in selecting nominees for director (the “Director Criteria”).

 

b. To identify and screen individuals qualified to become members of the Board, consistent with the Director Criteria. The Committee shall consider any director candidates recommended by the Company’s stockholders pursuant to the procedures described in the Company’s proxy statement. The Committee shall also consider any nominations of director candidates validly made by stockholders in accordance with applicable laws, rules and regulations and the provisions of the Company’s charter documents.

 

 
 

 

c. To select and approve the nominees for director to be submitted to a stockholder vote at the annual meeting of stockholders.

 

d. To review the Board’s committee structure and composition and to appoint directors to serve as members of each committee and committee chairmen.

 

e. If a vacancy on the Board and/or any Board committee occurs, to identify and select and approve candidates to fill such vacancy either by election by stockholders or appointment by the Board.

 

f. To develop and recommend to the Board for approval standards for determining whether a director has a relationship with the Company that would impair its independence.

 

g. To review and discuss with management the disclosure regarding the operations of the Committee and director independence, and to recommend that this disclosure be, included in the Company’s proxy statement or annual report on Form 10-K, as applicable.

 

h. To monitor compliance with the Company’s Code of Ethics and Business Conduct (the “Code”), to investigate any alleged breach or violation of the Code and to enforce the provisions of the Code.

 

Outside Advisors

 

The Committee shall have the authority, in its sole discretion, to select, retain and obtain the advice of a director search firm as necessary to assist with the execution of its duties and responsibilities as set forth in this Charter. The Committee shall set the compensation, and oversee the work, of the director search firm. The Committee shall have the authority, in its sole discretion, to retain and obtain the advice and assistance of outside counsel and such other advisors as it deems necessary to fulfill its duties and responsibilities under this Charter. The Committee shall set the compensation, and oversee the work, of its outside counsel and other advisors. The Committee shall receive appropriate funding from the Company, as determined by the Committee in its capacity as a committee of the Board, for the payment of compensation to its compensation consultants, outside counsel and any other advisors.

 

Structure and Operations

 

The Board shall designate a member of the Committee as the Chairperson. The Committee shall meet at least two (2) times a year at such times and places as it deems necessary to fulfill its responsibilities. The Committee shall report regularly to the Board regarding its actions and make recommendations to the Board as appropriate. The Committee is governed by the same rules regarding meetings (including meetings in person or by telephone or other similar communications equipment), action without meetings, notice, waiver of notice, and quorum and voting requirements as are applicable to the Board.

 

The Committee shall review this Charter at least annually and recommend any proposed changes to the Board for approval.

 

Delegation of Authority

 

The Committee shall have the authority to delegate any of its responsibilities, along with the authority to take action in relation to such responsibilities, to one or more subcommittees as the Committee may deem appropriate in its sole and absolute discretion.

 

ADOPTED: This 5th day of May, 2021