Questions & Answers Relating to our Extraordinary General Meeting on March 12, 2018
Auris Medical Holding AG’s (“Company” or “Auris Medical”) Extraordinary General Meeting will take place on March 12, 2018 at 8:30 am CET at the Theater Casino Zug, Artherstrasse 2-4, 6300 Zug, Switzerland (“General Meeting”).
General Meeting materials and further information are available on the events page of our website and have been mailed to our holders of record as of February 9, 2018.
On March 1, 2017, the Company announced that it had received written notification from The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it was not in compliance with the minimum bid price requirement set forth in Nasdaq Rules for continued listing on the Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of USD 1.00 per share. Through February 8, 2018, the Company had not regained compliance with such minimum bid price requirement.
In order to regain compliance prior to the deadline on March 26, 2018, the Board of Directors is proposing a restructuring of its share capital that would effectuate a reverse split by way of an intra-group reverse merger (“Merger”) in the event that the Company’s shares do not trade at a level which would ensure compliance with the Nasdaq’s minimum bid price rule in the ten (10) trading days prior to the General Meeting or up to five (5) trading days after the General Meeting.
The Company is incorporated in Switzerland and subject to Swiss law. Current Swiss law requires the approval of every single shareholder to carry out a normal reverse share split which, for public companies, is not realistic. The Company is therefore proposing to its shareholders to approve the Merger, which would have, once consummated, the same result as a reverse share split in order to regain compliance with Nasdaq rules.
The Company and Auris Medical NewCo Holding AG, a newly incorporated, Swiss subsidiary currently wholly owned by the Company (“Auris NewCo”) have entered into a merger agreement dated February 9, 2018. The Board of Directors seeks approval to effect a statutory reverse merger of the Company with and into Auris NewCo, as the surviving company, whereby, upon effectiveness of the Merger, the Company will be merged into and with Auris NewCo, which will be the surviving company and which will have a share capital of CHF 122,347.76, divided into 6,117,388 registered shares with a nominal value of CHF 0.02 each (subject to changes/adjustments). For each 10 shares in the Company with a nominal value of CHF 0.40 each, 1 new share with a nominal value of CHF 0.02 in Auris NewCo will be issued and allocated, effectively resulting in a “reverse share split” at a ratio of 10-for-1 through the Merger.
Yes. The proposal provides that the restructuring would not take place if the closing price of the Company's shares has been at or above $2 in the 10 trading days prior to the General Meeting or up to 5 trading days after the General Meeting. If the closing price during that period has been between $1 and $2, then the Board of Directors may at its sole discretion decide on whether or not the intra-group reverse merger shall take place.
In case of a withdrawal of the proposal by the Board of Directors prior to the General Meeting, the General Meeting will be cancelled and all submitted proxies will be annulled.
For detailed information on the conditions, please consult the official Invitation to the Extraordinary General Meeting.
Each share of the Company’s common shares entitles the holder to one vote on all matters to come before the General Meeting. Two-thirds of the shares represented at the General Meeting, in person or by proxy, is required to approve the Merger.
The Company anticipates that the shares of the surviving company (Auris NewCo, to be renamed “Auris Medical Holding AG” in the course of the Merger) will be listed on the Nasdaq Capital Market following the effectiveness of the Merger under the trading symbol “EARS”. Following the consummation of the Merger, the shares will begin trading on the Nasdaq Capital Market on a split-adjusted basis on or around March 13, 2018.
To consummate the Merger, the Company’s shareholders must approve Agenda Item 1. In addition, the Company is requesting its shareholders to vote on the following items:
1 Conditional Agenda item: Approval of the merger between Auris Medical Holding AG (as transferring entity) and Auris Medical NewCo Holding AG (as surviving entity) according to the terms and conditions set forth by the merger agreement dated 9 February 2018 and based on the interim balance sheet of Auris Medical Holding AG as of 30 September 2017
2* Discharge of liability for the members of the Board of Directors and the persons entrusted with the Company’s management
3* Compensation of the Board of Directors and the Executive Management
3.1 -Approval of the Compensation of the Board of Directors
3.2 -Approval of the Compensation of the members of the Executive Management Committee for the 2019 financial year
4* Elections to the Board of Directors and Re-election of the Chairman
4.1* -Re-election of Thomas Meyer as member and as Chairman of the Board of Directors
4.2* -Re-election of Armando Anido as member of the Board of Directors
4.3* -Re-election of Mats Blom as member of the Board of Directors
4.4* -Re-election of Calvin W. Roberts as member of the Board of Directors
4.5* -Election of Alain Munoz as member of the Board of Directors
in each case for a term of one year ending upon completion of the 2019 Annual General Meeting.
5* Elections to the Compensation Committee
5.1* -Re-election of Armando Anido as member of the Compensation Committee
5.2* -Election of Alain Munoz as member of the Compensation Committee
for a term of one year ending upon completion of the 2019 Annual General Meeting.
6* Re-Election of the Auditors
7* Re-Election of the Independent Proxy
* General Comment: The General Meeting will not take place and, accordingly, no vote on Agenda Items 2–7 will be conducted, in case of a withdrawal of Agenda Item 1 (see “Is the Merger conditional?”). Any decision by the Board of Directors to cancel the General Meeting will be publicly announced immediately prior to March 12, 2018. The Board of Directors would thereafter call an ordinary general meeting. In case of a vote on (and approval of) Agenda Item 1 (Merger), the voting on Agenda Items 2–7 shall be conducted, and the results on Agenda Items 3–7 shall be implemented, subject to the consummation of the Merger, correspondingly at the level of Auris NewCo; as the respective resolutions would be adopted by the separate general meeting of Auris NewCo immediately prior to the registration of the Merger in accordance with the votes received from the General Meeting.
The Company’s Board of Directors recommends that the Company’s shareholders vote in favor (“YES”) of the Merger.
The General Meeting will take place on March 12, 2018 at 8:30 am CET at the Theater Casino Zug, Artherstrasse 2-4, 6300 Zug, Switzerland.
“Street name” holders should follow the instructions provided by their bank, broker or nominee when voting their shares.
Shareholders of record who do not attend the General Meeting in person, may:
(a) grant a proxy to the independent proxy, Sandro Tobler, attorney at law, Schnurrenberger, Tobler, Gnehm & Partner, Alpenstrasse 2, 6300 Zug, Switzerland, in writing or electronically (see instruction on the proxy form); or
(b) grant a proxy in writing to another shareholder or other third party.
Proxies to the independent proxy must be received by the independent proxy or by Vote Processing c/o Broadridge, 51 Mercedes Way, Edgewood NY11717, USA, no later than 4pm EDT on March 7, 2018. Proxies received after such time will not be considered.
To vote electronically, go to proxyvote.com and follow the instructions. You will need a 12-digit control number that is included on your proxy form. Electronic instructions must be received no later than 4pm EDT on March 8, 2018.
Shareholders that have granted a proxy to the independent proxy may not vote their shares at the General Meeting.
Yes. To vote electronically, go to proxyvote.com and follow the instructions. You will need a 12-digit control number that is included on your proxy form. Electronic instructions must be received by no later than 4pm EDT on March 8, 2018.
Shareholders registered in the share ledger maintained by AST at 4pm EST on March 5, 2018 are entitled to participate in and vote at the General Meeting. Shareholders who wish to attend the General Meeting in person will be required to present the proxy form and a valid government issued proof of identification. Shareholders who do not attend the General Meeting in person may grant a proxy to the independent proxy or a third party.
“Street name” holders should follow the instructions provided by their bank, broker or nominee when voting their shares. “Street name” holders who wish to vote in person at the General Meeting must obtain a signed proxy from the organization that holds their shares entitling them to represent and vote the shares at the General Meeting. The record date for “street name” holders is February 9, 2018.
In the United States, the vast majority of shares held by a broker or an agent of that broker are registered under the name of Cede & Co., as nominee for The Depository Trust Company (which acts as depositary and clearing house for many U.S. brokerage firms and custodian banks). If your shares are held in a stock brokerage account or otherwise by a broker, bank, trust or other nominee, then Cede & Co. is considered the record or registered holder and you are considered the beneficial owner of those shares, and your shares are said to be held in “street name.” Street name holders generally cannot vote their shares directly and must instead instruct their broker, bank, trust or other nominee how to vote their shares in connection with shareholder meetings.
If your shares are registered directly in your name in the Company’s records, you are considered the shareholder of record with respect to those shares. Shareholders of record can vote their shares directly.
If your shares are held in “street name” and you wish to become a shareholder of record, you can instruct your broker-dealer to move your security position through the Direct Registration System (“DRS”) to American Stock Transfer & Trust Company, LLC (“AST”), the Company’s transfer agent, for direct registration on the Company’s share register held with AST. The DRS provides for electronic direct registration of securities in an investor's name on the books of a company with its transfer agent, and allows shares to be transferred between a transfer agent and broker electronically. If you later wish to sell your shares through your broker-dealer, you may instruct your broker-dealer to request that your shares be moved back to the broker-dealer through the DRS.
The Independent Proxy will vote the shares in accordance with the instructions provided by shareholders. Absent any instructions, the Independent Proxy will vote “FOR” all proposals submitted by the Board of Directors to the General Meeting for shares for which the Independent Proxy has been granted a proxy.
Whilst currently not foreseen, the Board of Directors may find itself in a position where it wishes to submit new proposals or new agenda items to the General Meeting. You may instruct the Independent Proxy to vote “FOR”, “AGAINST” or “ABSTAIN” from voting on such new proposals or new agenda items by ticking the appropriate box (“General Instructions on new proposals of the Board of Directors/new agenda items”) of your proxy form. Absent any instruction, the Independent Proxy would vote in accordance with the Board of Directors’ proposal on any new proposals or new agenda items proposed to the General Meeting.
Note: In case of any discrepancies between any information in this Q&A and any information in the official Invitation to the Extraordinary General Meeting, the wording of the Invitation prevails.
General Questions & Answers
We started operations in 2003.
Auris Medical Holding AG is incorporated under the laws of Switzerland.
Auris Medical Holding AG
The Company ticker symbol is EARS. Our shares are traded on the NASDAQ Capital Market.
We went public on July 6, 2014 with trading of our shares starting on August 6, 2014. The issue price was USD 6.00 per share.
American Stock Transfer & Trust Company, LLC
6201 15th Avenue Brooklyn
New York, NY 11219
Phone +1(718) 921-8200
You can view our Board of Directors by visiting the Board of Directors section of our website.
You can view our management team by visiting the Management Team section of our website.
Deloitte AG, Zurich, Switzerland
We have never paid or declared any cash dividends on our shares, and we do not anticipate paying any cash dividends on our common shares in the foreseeable future.
Quarterly and annual reports, as well as other SEC filings, can be accessed in the Financial Information section of our website or directly from the SEC at www.sec.gov.
You can contact us via email at: Investors[at]aurismedical.com. In addition, you can reach Investor Relations by calling: +41 41 729 71 94.