UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a)
of the Securities
Exchange Act of 1934
Filed by the Registrant
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Filed by a Party other than the Registrant
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Check the appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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RegeneRx
Biopharmaceuticals, Inc.
(Name of Registrant as Specified In Its
Charter)
(Name of Person(s) Filing Proxy Statement,
if other than the Registrant)
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Payment of Filing Fee (Check the appropriate box):
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No fee required.
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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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Aggregate number of securities to which transaction applies:
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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 the filing fee is calculated and state how it was determined):
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Proposed maximum aggregate value of transaction:
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Total fee paid:
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Fee paid previously with preliminary materials.
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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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(1)
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Amount Previously Paid:
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Form, Schedule or Registration Statement No.:
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Filing Party:
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Date Filed:
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Allan L. Goldstein, Ph.D.
Chairman and Chief Scientific Officer
August [—], 2019
Dear Fellow Stockholder:
You are cordially
invited to attend the 2019 Annual Meeting (the “Meeting”) of Stockholders of RegeneRx Biopharmaceuticals, Inc. (the
“Company”), to be held at 11:00 a.m., Eastern Time, on Friday, September 27, 2019, at the Company office facility’s
meeting room at 15245 Shady Grove Road, Rockville, Maryland 20850.
An important aspect
of the Meeting is the stockholder vote on corporate business items. I urge you to exercise your rights as a stockholder to vote
and participate in this process. Stockholders are being asked to consider and vote upon: (i) the election of six directors of the
Company, (ii) a non-binding advisory resolution approving named executive officer compensation, (iii) the approval of an amendment
to the Company’s Certificate of Incorporation to increase the authorized capital stock of the Company by 50,000,000 shares,
and (iv) the ratification of the appointment of CohnReznick LLP, as the Company’s independent registered public accounting
firm for the fiscal year ending December 31, 2019.
The Board of Directors
has determined that approval of the matters to be considered at the Meeting is in the best interests of the Company and its stockholders.
For the reasons set forth in the Proxy Statement, the Board unanimously recommends that you vote “FOR” each of the
Board of Directors’ nominees as directors specified under Proposal 1, “FOR” the non-binding advisory resolution
approving named executive officer compensation specified under Proposal 2, “FOR” the amendment to the Certificate to
increase the authorized shares specified under Proposal 3, and “FOR” the ratification of the appointment of the independent
registered public accounting firm specified under Proposal 4.
I encourage you to
attend the Meeting in person. Whether or not you plan to attend,
please vote your shares and sign, date and return the proxy
mailed to you, or vote over the telephone or the Internet as instructed in these materials as promptly as possible
. This will
save the Company additional expense in soliciting proxies and will ensure that your shares are represented at the Meeting.
Your Board of Directors
and management are committed to the success of the Company and the enhancement of the value of your investment. I want to express
my appreciation for your confidence and support.
Very truly yours,
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Allan L. Goldstein, Ph.D.
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Chairman of the Board
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RegeneRx Biopharmaceuticals, Inc. | 15245
Shady Grove Road, Suite 470, Rockville, MD 20850
PHONE 301.208.9191 | FAX 301.208.9194 | WEB www.regenerx.com
REGENERX BIOPHARMACEUTICALS, INC.
15245 Shady Grove Road, Suite 470
Rockville, Maryland 20850
(301) 208-9191
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held On Friday, September 27, 2019
Dear Stockholder:
You are cordially invited to attend the
Annual Meeting of Stockholders (the “Annual Meeting”) of RegeneRx Biopharmaceuticals, Inc., a Delaware corporation
(the “Company”). The Annual Meeting will be held on Friday, September 27, 2019 at 11:00 a.m. local time in the meeting
room of the Company’s office facility at 15245 Shady Grove Road, Rockville, Maryland 20850, for the following purposes:
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To elect the Board’s six nominees for director to
serve until the 2020 Annual Meeting of Stockholders and until their successors are elected and qualified.
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To consider and vote upon a non-binding advisory resolution
regarding named executive officer compensation.
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To consider and vote upon the amendment to the Certificate
of Incorporation to increase the authorized capital stock of the Company by 50,000,000 shares.
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To ratify the selection by the Audit Committee of the Board
of Directors of CohnReznick LLP (“CohnReznick”) as the independent registered public accounting firm of the Company
for its fiscal year ending December 31, 2019.
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To conduct any other business properly brought before the
Annual Meeting.
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These items of business are more fully
described in the Proxy Statement accompanying this Notice.
The record date for the Annual Meeting
is July 29, 2019. Only stockholders of record at the close of business on that date may vote at the meeting or any adjournment
thereof.
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By Order of the Board of Directors
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Allan L. Goldstein, Ph.D.
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Chairman of the Board
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Rockville, Maryland
August [—], 2019
You are cordially invited to attend
the Annual Meeting in person. Whether or not you expect to attend the meeting, please complete, date, sign and return the proxy
that we may mail to you, or vote over the telephone or the Internet as instructed in these materials, as promptly as possible in
order to ensure your representation at the meeting. Even if you have voted by proxy, you may still vote in person if you attend
the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote
at the meeting, you must obtain a proxy issued in your name from that record holder.
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS
FOR THE
ANNUAL MEETING TO BE HELD ON SEPTEMBER 27, 2019:
The Proxy Statement
and Fiscal 2018 Annual Report to Stockholders are
available at:
http://www.proxyvote.com
REGENERX BIOPHARMACEUTICALS, INC.
15245 Shady Grove Road, Suite 470
Rockville, Maryland 20850
(301) 208-9191
PROXY STATEMENT
FOR THE 2019 ANNUAL MEETING OF STOCKHOLDERS
September 27, 2019
QUESTIONS AND ANSWERS ABOUT THESE PROXY
MATERIALS AND VOTING
The Board of Directors of RegeneRx Biopharmaceuticals,
Inc. (the “Company”) is soliciting your proxy to vote at the Annual Meeting of Stockholders (the “Annual Meeting”)
to be held in the basement meeting room of the Company’s office facility at 15245 Shady Grove Road, Rockville, Maryland 20850
on Friday, September 27, 2019 at 11:00 a.m. local time, including at any adjournments or postponements of the Annual Meeting. You
are invited to attend the Annual Meeting to vote on the proposals described in this proxy statement. However, you do not need to
attend the meeting to vote your shares. Instead, you may simply complete, sign and return the enclosed proxy card, if you received
paper copies of the proxy materials, or follow the instructions below to submit your proxy over the telephone or the Internet.
Why did I receive in the mail a Notice of Internet Availability
of Proxy Materials instead of a full set of proxy materials?
We are pleased to take advantage of the
SEC rule that allows companies to furnish their proxy materials over the Internet. Accordingly, we have sent to our beneficial
owners a Notice of Internet Availability of Proxy Materials. Instructions on how to access the proxy materials over the Internet
or to request a paper copy may be found in the Notice. Our stockholders may request to receive proxy materials in printed form
by mail or electronically on an ongoing basis. A stockholder’s election to receive proxy materials by mail or electronically
by email will remain in effect until the stockholder terminates its election.
Why did I receive a full set of proxy materials in the
mail instead of a Notice of Internet Availability of Proxy Materials?
We are providing paper copies of the proxy
materials instead of a Notice to our stockholders of record. If you are a beneficial owner or stockholder of record who received
a paper copy of the proxy materials, and you would like to reduce the environmental impact and the costs incurred by us in mailing
proxy materials, you may elect to receive all future proxy materials electronically via email or the Internet.
You can choose to receive our future proxy
materials electronically by visiting http://www.proxyvote.com. Your choice to receive proxy materials electronically will remain
in effect until you instruct us otherwise by following the instructions contained in your Notice and visiting http://www.proxyvote.com,
sending an electronic mail message to sendmaterial@proxyvote.com, or calling 1-800-579-1639.
The SEC has enacted rules that permit us
to make available to stockholders electronic versions of the proxy materials even if the stockholder has not previously elected
to receive the materials in this manner. We have chosen this option in connection with the Annual Meeting with respect to our beneficial
owners and stockholders of record.
We intend to mail the Notice on or about
August 30, 2019 to all stockholders of record entitled to vote at the Annual Meeting.
How do I attend the Annual Meeting?
The Annual Meeting
will be held on Friday, September 27, 2019 at 11:00 a.m. local time at the Company office facility’s basement meeting room
at 15245 Shady Grove Road, Rockville, Maryland 20850. Directions to the Company’s office facility may be found at: http://www.regenerx.com/wt/page/contact_us.Information
on how to vote in person at the Annual Meeting is discussed below.
Who can vote at the Annual Meeting?
Only stockholders of record at the close of business on July
29, 2019 will be entitled to vote at the Annual Meeting. On this record date, there were 131,506494 shares of common stock outstanding
and entitled to vote.
Stockholder of Record: Shares Registered in Your Name
If, on July 29, 2019, your shares were
registered directly in your name with our transfer agent, American Stock Transfer & Trust, then you are a stockholder of record.
As a stockholder of record, you may vote in person at the meeting or vote by proxy. Whether or not you plan to attend the meeting,
we urge you to fill out and return a proxy card or vote by proxy over the telephone or on the Internet as instructed below to ensure
your vote is counted.
Beneficial Owner: Shares Registered in the Name of a Broker
or Bank
If on July 29, 2019, your shares were held,
not in your name, but rather in an account at a brokerage firm, bank, dealer, or other similar organization, then you are the beneficial
owner of shares held in “street name” and the Notice is being forwarded to you by that organization. The organization
holding your account is considered to be the stockholder of record for purposes of voting at the Annual Meeting. As a beneficial
owner, you have the right to direct your broker or other agent regarding how to vote the shares in your account. You are also invited
to attend the Annual Meeting. However, since you are not the stockholder of record, you may not vote your shares in person at the
meeting unless you request and obtain a valid proxy from your broker, bank or other agent.
What am I voting on?
There are four matters scheduled for a vote:
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Election of six directors;
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To consider and vote upon named executive officer
compensation on a non-binding and advisory basis;
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To consider amending the Company’s Certificate
of Incorporation to increase the Company’s authorized capital stock by 50,000,000 shares; and
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Ratification of the selection of CohnReznick LLP (CohnReznick)
by our Audit Committee as our independent registered public accounting firm for the fiscal year ending December 31, 2019
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What if another matter is properly brought before the meeting?
The Board of Directors knows of no other
matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting,
it is the intention of the persons named in the accompanying proxy to vote on those matters in accordance with their best judgment.
How do I vote?
You may either vote “For” all
the nominees to the Board or you may “Withhold” your vote for any nominee you specify. For each of the other matters
to be voted on, you may vote “For” or “Against” or abstain from voting. The procedures for voting are fairly
simple:
Stockholder of Record: Shares Registered in Your Name
If you are a stockholder of record, you
may vote in person at the Annual Meeting, vote by proxy over the telephone, vote by proxy on the Internet or vote by proxy using
a proxy card that you may request as set forth above or that we may deliver at a later time. Whether or not you plan to attend
the meeting, we urge you to vote by proxy to ensure your vote is counted. You may still attend the meeting and vote in person even
if you have already voted by proxy.
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To vote in person, come to the Annual Meeting and
we will give you a ballot when you arrive.
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To vote using the proxy card, simply complete, sign
and date the proxy card that may be delivered and return it promptly in the envelope provided. If you return your signed proxy
card to us before the Annual Meeting, we will vote your shares as you direct.
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To vote over the telephone, dial the number indicated
on your proxy card using a touch-tone phone and follow the recorded instructions. You will be asked to provide the company number
and control number from the Notice. Your vote must be received by 11:59 p.m. Eastern time on September 26, 2019, to be counted.
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To vote on the Internet, please follow the directions
as instructed on the proxy card you received. You will be asked to provide the company number and control number from the Notice.
Your vote must be received by 11:59 p.m. Eastern time on September 26, 2019 to be counted.
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Beneficial Owner: Shares Registered in the Name of Broker
or Bank
If you are a beneficial owner of shares
registered in the name of your broker, bank, or other agent, you should have received a Notice containing voting instructions from
that organization rather than from us. Simply follow the voting instructions in the Notice to ensure that your vote is counted.
To vote in person at the Annual Meeting, you must obtain a valid proxy from your broker, bank, or other agent. Follow the instructions
from your broker or bank included with these proxy materials, or contact your broker or bank to request a proxy form.
We provide Internet proxy voting to
allow you to vote your shares online, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions.
How many votes do I have?
On each matter to be voted upon, you have one vote for each
share of common stock you owned on July 29, 2019.
What if I return a proxy card or otherwise vote but do
not make specific choices?
If you return a signed and dated proxy
card or otherwise vote without marking voting selections, your shares will be voted, as applicable, “FOR” the election
of all six nominees for director, “FOR” the advisory resolution on named executive officer compensation, “FOR”
the approval of the amendment to the Certificate of Incorporation to increase the Company’s authorized shares by 50,000,000
shares, and “FOR” the ratification of the selection of CohnReznick as our independent registered public accounting
firm for the fiscal year ending December 31, 2019. If any other matter is properly presented at the meeting, your proxyholder (the
individual named on the proxy card) will vote your shares using his best judgment.
Who is paying for this proxy solicitation?
We will pay for the
entire cost of soliciting proxies. In addition to these proxy materials, our directors and employees may also solicit proxies
in person, by telephone, or by other means of communication. Directors and employees will not be paid any additional compensation
for soliciting proxies. We may also reimburse brokerage firms, banks and other agents for the cost of forwarding proxy materials
to beneficial owners.
What does it mean if I receive more than one Notice?
If you receive more than one Notice, your shares may be
registered in more than one name or in different accounts. Please follow the voting instructions on
each
Notice to
ensure that all of your shares are voted.
Can I change my vote after submitting my proxy or revoke
my proxy?
Yes. You can revoke your proxy at any time before the final
vote at the meeting. If you are the record holder of your shares, you may revoke your proxy in any one of the following ways:
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You may submit another properly completed proxy card
with a later date.
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You may grant a subsequent proxy by telephone or on
the Internet.
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You may send a timely written notice that you are
revoking your proxy to the Company’s Secretary at 15245 Shady Grove Road, Suite 470, Rockville, Maryland 20850.
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You may attend the Annual Meeting and vote in person.
Simply attending the meeting will not, by itself, revoke your proxy.
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Your most current proxy card or telephone or Internet proxy
is the one that is counted.
If your shares are held by your broker or bank as a nominee
or agent, you should follow the instructions provided by your broker or bank.
When are stockholder proposals due for next year’s
annual meeting?
To be considered for inclusion in next
year’s proxy materials, your proposal must be submitted in writing by April 1, 2020, to the Company’s Secretary at
15245 Shady Grove Road, Suite 470, Rockville, Maryland 20850. A stockholder proposal will need to comply with the SEC regulations
under Rule 14a-8 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), regarding the inclusion of
stockholder proposals in company-sponsored proxy materials. Although our Board of Directors will consider stockholder proposals,
we reserve the right to omit from our proxy statement, or to vote against, stockholder proposals that we are not required to include
under the Exchange Act, including Rule 14a-8. If you wish to bring a matter before the stockholders at next year’s annual
meeting outside of our proxy materials and you do not notify us before April 1, 2020 for all proxies we receive, the proxyholders
will have discretionary authority to vote on the matter, including discretionary authority to vote in opposition to the matter.
If you wish to nominate a director for election at next year’s annual meeting, any such nomination shall be made by notice,
in writing, to the Company’s Secretary not less than 14 days, nor more than 50 days, prior to the meeting. You are also advised
to review our bylaws, which contain additional requirements about advance notice of director nominations.
How are votes counted?
Votes will be counted by the inspector of election appointed
for the meeting.
What are “broker non-votes”?
Broker non-votes
occur when a beneficial owner of shares held in “street name” does not give instructions to the broker or nominee
holding the shares as to how to vote on matters deemed “non-routine.” Generally, if shares are held in street name,
the beneficial owner of the shares is entitled to give voting instructions to the broker or nominee holding the shares. If the
beneficial owner does not provide voting instructions, the broker or nominee can still vote the shares with respect to matters
that are considered to be “routine,” but not with respect to “non-routine” matters. Proposals No. 1, 2
and 3 are considered to be “non-routine.” Proposal No. 4, the vote to ratify the selection for our independent registered
public accounting firm, is considered to be “routine.”
How many votes are needed to approve each proposal?
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For Proposal 1, the election of directors, the six
nominees receiving the most “FOR” votes will be elected.
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Proposal 2, regarding named executive officer compensation,
is an advisory vote, which means that the vote is not binding on the Company, our Board of Directors, or the Compensation Committee
of the Board of Directors. To the extent there is any significant vote against our named executive officer compensation as disclosed
in this proxy statement, the Compensation Committee will evaluate whether any actions are necessary to address the concerns of
stockholders.
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Proposal 3, the approval of the amendment to the Company’s
Certificate of Incorporation to increase the authorized capital stock by 50,000,000 shares, must receive “FOR” votes
from the holders of a majority of shares present and entitled to vote either in person or by proxy. If you “ABSTAIN”
from voting, it will have the same effect as an “Against” vote. Broker non-votes will have no effect.
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Proposal 4, the ratification of the appointment of
CohnReznick as our independent registered public accounting firm for the year ending December 31, 2019, must receive “FOR”
votes from the holders of a majority of shares present and entitled to vote either in person or by proxy. If you “ABSTAIN”
from voting, it will have the same effect as an “Against” vote.
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What is the quorum requirement?
A quorum of stockholders is necessary to
hold a valid meeting. A quorum will be present if stockholders holding at least a majority of the outstanding shares entitled to
vote are present at the meeting in person or represented by proxy. On the record date, there were 131,506,494 shares outstanding
and entitled to vote. Thus, the holders of 65,753,248 shares must be present in person or represented by proxy at the meeting to
have a quorum.
Your shares will be counted towards the
quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank or other nominee) or if you vote
in person at the meeting. Abstentions and broker non- votes will be counted towards the quorum requirement. If there is no quorum,
the holders of a majority of shares present at the meeting in person or represented by proxy may adjourn the meeting to another
date.
How can I find out the results of the voting at the Annual
Meeting?
Preliminary voting results will be announced
at the Annual Meeting. In addition, final voting results will be published in a Current Report on Form 8-K, which we will file
within four business days after the Annual Meeting.
PROPOSAL 1
ELECTION OF DIRECTORS
The Company’s
Board of Directors currently consists of six directors. Each of the six continuing directors to be elected and qualified will
hold office until the next Annual Meeting of Stockholders and until his successor is elected and qualified, or, if sooner, until
the director’s death, resignation or removal. Each of the nominees listed below is currently a director of the Company who
was previously elected by the stockholders. It is the Company’s policy to encourage nominees for directors to attend the
Annual Meeting.
Directors are
elected by a plurality of the votes of the holders of shares present in person or represented by proxy and entitled to vote
on the election of directors. The six nominees receiving the highest number of affirmative votes will be elected. Shares
represented by executed proxies will be voted, if authority to do so is not withheld, for the election of the five nominees
named below. If any nominee becomes unavailable for election as a result of an unexpected occurrence, your shares may be
voted for the election of a substitute nominee proposed by the Company. Each person nominated for election has agreed to
serve if elected. The Company’s management has no reason to believe that any nominee will be unable to serve.
Nominees
The following is a brief biography of each
nominee for director and a discussion of the specific experience, qualifications, attributes or skills of each nominee that led
the Board to recommend that person as a nominee for director, as of the date of this proxy statement. Ages are as of August 21,
2019.
We seek to assemble a board that, as a
whole, possesses the appropriate balance of professional and industry knowledge, financial expertise and high-level management
experience necessary to oversee and direct our business. To that end, our Board intends to maintain membership of directors who
complement and strengthen the skills of other members and who also exhibit integrity, collegiality, sound business judgment and
other qualities that we view as critical to effective functioning of the Board. The brief biographies below include information,
as of the date of this proxy statement, regarding the specific and particular experience, qualifications, attributes or skills
of each director or nominee that led the Board to believe that the director should serve on the Board.
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Name
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Age
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Principal Occupation/Position Held
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Director
since
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Allan L. Goldstein
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81
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Former Chairman, Department of Biochemistry and Molecular Biology, The George Washington University School of Medicine and Health Sciences; Founder, Chairman of the Board and Chief Scientific Advisor of the Company
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1982
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J.J. Finkelstein
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67
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President and Chief Executive Officer of the Company
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2002
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Joseph C. McNay
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85
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Chairman, Chief Investment Officer and Managing Principal, Essex Investment Management Company
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1987
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Mauro Bove
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64
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Business Development consultant to emerging pharmaceutical companies in Asia, including Lee’s Pharmaceuticals
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2004
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R. Don Elsey
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66
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CFO of Lyra Therapeutics, a private therapeutic company
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2010
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Alessandro Noseda
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61
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CEO of Leadiant Biosciences S.p.A.
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2019
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Dr. Goldstein
has served as the
Chairman of our Board of Directors and our Chief Scientific Officer since he founded our company in 1982. Dr. Goldstein is Emeritus
Professor & former Chairman of the Department of Biochemistry and Molecular Medicine at the George Washington University School
of Medicine and Health Sciences. Dr. Goldstein is a recognized expert in the field of immunology and protein chemistry, having
authored over 435 scientific articles in professional journals. He is also the inventor on over 25 issued and/or pending patents
in biochemistry, immunology, cardiology, cancer and wound healing. Dr. Goldstein discovered several important compounds, including
Tß1, which is marketed worldwide, and Tß4, which is the basis for RegeneRx’s clinical program. Dr. Goldstein
served on the Board of Trustees of the Sabin Vaccine Institute from 2000 to 2012 and on the Board of Directors of the Richard B.
and Lynne V. Cheney Cardiovascular Institute from 2006 to 2012. Dr. Goldstein has also done pioneering work in the area of medical
education, developing distance learning programs for the internet entitled “Frontiers in Medicine,” a medical education
series that Dr. Goldstein developed. The Board believes that Dr. Goldstein’s scientific expertise, industry background and
prior experience as our founder all position him to make an effective contribution to the medical and scientific understanding
of the Board, which the committee believes to be particularly important as we continue our Tß4 development efforts.
Mr. Finkelstein
has served as our
President and Chief Executive Officer and a member of our Board of Directors since 2002. Mr. Finkelstein also served as our Chief
Executive Officer from 1984 to 1989 and as the Vice Chairman of our Board of Directors from 1989 to 1991. Mr. Finkelstein has worked
as an executive officer and consultant in the bioscience industry for the past 36 years, including serving from 1989 to 1996 as
chief executive officer of Cryomedical Sciences, Inc., a publicly-traded medical device company. Mr. Finkelstein has significant
experience in developing early-stage companies. He has been responsible for the regulatory approval and marketing of several medical
devices in the U.S. and abroad. Mr. Finkelstein has previously served on the executive committee of the Board of Directors of the
Technology Council of Maryland and MdBio, Inc. and currently chairs the MdBio Foundation, all of which are non-profit entities
that support bioscience development and education in the State of Maryland. Mr. Finkelstein received a business degree in finance
from the University of Texas. The Board believes that Mr. Finkelstein’s history and long tenure as our Chief Executive Officer
positions him to contribute to the Board his extensive knowledge of our company and to provide Board continuity. In addition, the
Board believes that his experience at prior companies has provided him with operational and industry expertise, as well as leadership
skills that are important to the Board.
Mr. McNay
has served as a member
of our Board of Directors since 2002. He is currently Chairman, Chief Investment Officer and Managing Principal of Essex Investment
Management Company, LLC, positions he has held since 1976 when he founded Essex. He has direct portfolio management responsibilities
for a variety of funds and on behalf of private clients. He is also a member of the firm’s Management Board. Prior to founding
Essex, Mr. McNay was Executive Vice President and Director of Endowment Management & Research Corp. from 1967. Prior to that,
Mr. McNay was Vice President and Senior Portfolio Manager at the Massachusetts Company. Currently he is serving as Trustee of the
Dana Farber Cancer Institute, member of the Children’s Hospital Investment Committee and is on the Board of Brigham &
Women’s Hospital. He received his A.B. degree from Yale University and his M.B.A. degree in finance from the Wharton School
of the University of Pennsylvania. The Board believes that Mr. McNay’s extensive financial experience is valuable to our
business and also positions him to contribute to the audit committee’s understanding of financial matters.
Mr. Bove
has
served as a member of our Board of Directors since 2004 and has more than 30 years of business and management experience
within the pharmaceutical industry. Mr. Bove is currently based in Hong Kong and in Europe, serving as a consultant to
emerging pharmaceutical companies worldwide. Previously, Mr. Bove led for more than 20 years the Corporate & Business
Development of Sigma-Tau Finanziaria S.p.A., formerly the holding company of Sigma-Tau Group, a leading international
pharmaceutical company (Sigma-Tau Finanziaria S.p.A. - now Essetifin S.p.a. - and its affiliates are collectively our largest
stockholder). Mr. Bove, who resigned this role with Sigma-Tau on March 31, 2014, has also held a number of senior positions
in business, licensing and corporate development within Sigma-Tau Group. Mr. Bove obtained his law degree at the University
of Parma, Italy, in 1980. In 1985, he attended the Academy of American and International Laws at the International and
Comparative Law Center, Dallas, Texas. The Board believes that Mr. Bove’s extensive business and management experience
within the pharmaceutical industry allows him to recognize and advise the Board with respect to recent industry
developments.
Mr. Elsey
has served as a member
of our Board of Directors since September 2010. Currently Mr. Elsey serves as CFO of Lyra Therapeutics, a private company pioneering
a new therapeutic approach to treat debilitating ear, nose and throat diseases. Previously Mr. Elsey served as CFO of Senseonics,
Inc., from February 2015 to February 2019, a medical device company focused on continuous glucose monitoring. From May 2014 until
February 2015 Mr. Elsey served as chief financial officer of Regado Biosciences, a public, late-stage clinical development biopharmaceutical
company. From December 2012 to February 2014 Mr. Elsey served as chief financial officer of LifeCell, Inc., a privately held regenerative
medicine company. From June 2005 to December 2012, he served in numerous finance capacities, most recently as senior vice president
and chief financial officer, at Emergent BioSolutions Inc., a publicly held biopharmaceutical company. He served as the director
of finance and administration at IGEN International, Inc., a publicly held biotechnology company, and its successor BioVeris Corporation,
from April 2000 to June 2005. Prior to joining IGEN, Mr. Elsey served as director of finance at Applera, a genomics and sequencing
company, and in several finance positions at International Business Machines, Inc. He received an M.B.A. in finance and a B.A.
in economics from Michigan State University. Mr. Elsey is a certified management accountant. The Board believes that Mr. Elsey’s
experience as chief financial officer of a public company is particularly valuable to our business in that it positions him to
contribute to our board’s and audit committee’s understanding of financial matters.
Dr. Noseda
is the Chief Scientific
Officer (CSO) of Leadiant Biosciences S.p.A. and provides scientific and medical know-how to coordinate and manage the scientific
and development programs at a global level as well as to evaluate new opportunities for the Leadiant Group. Since September 2018
he is also Chief Medical Officer of Leadiant Biosciences, Inc. After graduating as a Medical Doctor in 1984 at the University of
Milan, and following a Post Doctorate at Bowman Gray School of medicine (USA), he joined the pharma industry in 1988 where he held
different managerial positions within the R&D and Marketing organizations of multinational companies. He has acquired a significant
experience in R&D (through the whole development process, from research to interaction with Health Authorities for MA submission
or HTA assessment) and strategic/business operations. He joined sigma-tau in 1998 as Director of Scientific Office and Strategic
Alliances within the Corporate R&D organization. In this position he managed key R&D projects and contributed to the finalization
of important partnerships (e.g. with Novartis, Debiopharm etc.) and to the advancement of product development (from research to
product registration). He has been part of the management Team and Board of Directors of biotech companies of the sigma-tau Group,
as Thule Therapeutics, Metheresis Translational Research and Rostaquo. He has also been Chief Executive Officer of Leadiant Biosciences
SA (formerly sigma-tau Research Switzerland) from 2007 to 2017, a position which he held in parallel with his former positions
in sigma-tau (1988-2014) and later in Leadiant where he acted as Chief Medical Officer (2014-2017) before becoming the CSO. Under
his management this company developed and advanced a proprietary technology and he guided the Company through the process to obtain
the authorization by the Swiss Health Authorities to import and release medicinal products, as well as the Orpha Drug Designations
and registration of new products (e.g. Chenodeoxycholic Acid or CDCA). He worked in several therapeutic (and diagnostic) areas,
but mostly in high unmet medical need specialty areas as cancer, immune-oncology and rare diseases.
VOTE REQUIRED
The Board recommends that you vote “FOR”
each of the nominees to the Board set forth in this Proposal 1. Under our Bylaws, the election of each nominee requires the affirmative
vote of a plurality of the votes cast by the stockholders entitled to vote on the election of directors at the Annual Meeting at
which a quorum is present.
INFORMATION REGARDING THE BOARD OF DIRECTORS AND CORPORATE
GOVERNANCE
Independence of the Board of Directors
Although our common stock is no longer
listed on the NYSE MKT exchange, we have determined the independence of our directors using the NYSE MKT definitions of independence.
Under NYSE MKT listing standards, a majority of the members of a listed company’s board of directors must qualify as “independent,”
as affirmatively determined by the Board. Our Board consults with counsel to ensure that its determinations are consistent with
relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth
in pertinent listing standards of the NYSE MKT, as they may be modified from time to time.
Consistent with these considerations, after
review of all relevant identified transactions or relationships between each director, or any of his family members, and our company,
our senior management and our independent auditors, our Board has determined that the following three directors are independent
directors within the meaning of the applicable NYSE MKT listing standards: Mr. Elsey, Mr. Bove, Dr. Noseda and Mr. McNay. In making
this determination, the Board found that none of these directors had a material or other disqualifying relationship with us. Mr.
Finkelstein, our President and Chief Executive Officer, and Dr. Goldstein our Chief Scientific Advisor, are not independent by
virtue of their employment with us.
In determining the independence of Mr.
Bove, the board of directors took into account the significant ownership of our common stock by Sigma-Tau and its affiliates and
our License Agreement with Lee’s Pharmaceuticals. The board of directors does not believe that any of the transactions with
Lee’s or Sigma-Tau and its affiliates described in this report has interfered or would reasonably be expected to interfere
with Mr. Bove’s exercise of independent judgment in carrying out his responsibilities as a director of our company.
Board Leadership Structure
The Board has a chairman, Dr. Goldstein,
who has authority, among other things, to call and preside over Board meetings, to set meeting agendas and to determine materials
to be distributed to the Board. Accordingly, the Chairman has substantial ability to shape the work of the Board. We believe that
separation of the positions of Chairman and Chief Executive Officer reinforces the independence of the Board in its oversight of
our business and affairs. In addition, we believe that having a separate Chairman creates an environment that is more conducive
to objective evaluation and oversight of management’s performance, increasing management accountability and improving the
ability of the Board to monitor whether management’s actions are in our best interests and those of our stockholders.
Role of the Board in Risk Oversight
One of the Board’s key functions
is informed oversight of our risk management process. The Board does not have a standing risk management committee, but rather
administers this oversight function directly through the Board as a whole, as well as through various Board standing committees
that address risks inherent in their respective areas of oversight. Our audit committee has the responsibility to consider and
discuss our major financial risk exposures and the steps our management has taken to monitor and control these exposures, including
guidelines and policies to govern the process by which risk assessment and management is undertaken. Our compensation committee
assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk- taking.
Meetings of the Board of Directors
The Board met 10 times during our 2018 fiscal year.
Information Regarding Committees of the Board of Directors
During the fiscal year ended December 31,
2018, the Board maintained two standing committees: an Audit Committee and a Compensation Committee. The Board does not have a
standing nominating and corporate governance committee. Rather, the independent members of the full Board perform the functions
of a nominating and corporate governance committee.
The following table provides membership
and meeting information for fiscal 2018 for each of the Board’s standing committees:
|
Name
|
|
Audit
|
|
|
Compensation
|
|
|
R. Don Elsey
|
|
|
X
|
|
|
|
X
|
*
|
|
Joseph McNay
|
|
|
X
|
*
|
|
|
X
|
|
|
Mauro Bove
|
|
|
|
|
|
|
X
|
|
|
Alessandro Noseda
|
|
|
|
|
|
|
X
|
|
|
Total meetings in fiscal 2018
|
|
|
4
|
|
|
|
1
|
|
Below is a description of each committee
of the Board. Each of the committees has authority to engage legal counsel or other experts or consultants as it deems appropriate
to carry out its responsibilities. The Board has determined that each member of each committee meets the applicable NYSE MKT rules
and regulations regarding “independence” and that each member is free of any relationship that would impair his individual
exercise of independent judgment with regard to the Company
Audit Committee
The Audit Committee consists of Mr. McNay
and Mr. Elsey, with Mr. McNay acting as the Chairman of the committee. The Audit Committee meets no less than quarterly with management
and our independent registered public accounting firm, both jointly and separately, has sole authority to engage and terminate
the engagement of our independent registered public accounting firm, and reviews our financial reporting process on behalf of the
Board. The Audit Committee met four times during the 2018 fiscal year. The Audit Committee operates under a formal written charter
available on our website at www.regenerx.com.
Each member of the Audit Committee is an
independent director determined in accordance with Rule 10A-3 of the Exchange Act. Furthermore, the Board has determined that Mr.
McNay and Mr. Elsey qualify as “audit committee financial experts” as defined under SEC rules.
The Audit Committee pre-approves all audit
and non-audit engagement fees, and terms and services. On an ongoing basis, management communicates specific projects and categories
of services for which advance approval of the Audit Committee is required. The Audit Committee reviews these requests and advises
management and the independent auditors if the Audit Committee pre-approves the engagement of the independent auditors for such
projects and services. On a periodic basis, the independent auditors report to the Audit Committee the actual spending for such
projects and services compared to the approved amounts.
Report of the Audit Committee of the Board of Directors
The following report of the Audit Committee
shall not be deemed to be filed with the SEC or incorporated by reference in any previous or future documents filed by the Company
with the SEC under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Company specifically
incorporates the reference in any such document.
The Audit Committee reviews the Company’s
financial reporting process on behalf of the Board. Management has the primary responsibility for the financial statements and
the reporting process. The Company’s independent registered public accountant is responsible for performing an independent
audit of the Company’s financial statements and expressing an opinion on the conformity of the audited financial statements
to generally accepted accounting principles.
The members of the Audit Committee have
reviewed and discussed with management the Company’s audited financial statements as of and for the fiscal year ended December
31, 2018. The members of the Audit Committee have discussed with CohnReznick, the Company’s independent auditor, the matters
required to be discussed by the statement on Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1, AU section
380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T. The members of the Audit Committee have received
and reviewed the written disclosures and the letter required by applicable requirements of the Public Company Accounting Oversight
Board regarding communications with the audit committee concerning independence, and the members of the Audit Committee have discussed
with CohnReznick their independence from management and the Company. The members of the Audit Committee have considered whether
the provision of services by CohnReznick referred to above not related to the audit of the financial statements and the reviews
of the interim financial statements included in the Company’s Forms 10-Q are compatible with maintaining CohnReznick’s
independence, and have determined that they are compatible and do not impact CohnReznick’s independence.
Based on the reviews and discussions referred
to above, the Audit Committee recommended to the Board that the audited financial statements referred to above should be included
in our Annual Report on Form 10-K accompanying this Proxy Statement and filed with the SEC for the fiscal year ended December 31,
2018.
|
Mr. Joseph McNay, Chairman
|
|
|
Mr. R. Don Elsey
|
|
Compensation Committee
The Compensation Committee consists of
Mr. McNay, Mr. Elsey, and Mr. Bove with Mr. Elsey acting as the Chairman of the committee The Compensation Committee met once during
the 2018 fiscal year. The Compensation Committee has adopted a written charter that is available to stockholders on our website
at www.regenerx.com.
The Compensation Committee of the Board
acts on behalf of the Board to review, adopt and oversee our compensation strategy, policies, plans and programs, including:
|
|
•
|
establishment of corporate and individual performance
objectives relevant to the compensation of our chief executive officer, other executive officers and Board members;
|
|
|
•
|
evaluation of performance in light of these stated
objectives;
|
|
|
•
|
review and approval of the compensation and other
terms of employment or service, including severance and change-in-control arrangements, of our Chief Executive Officer and the
other executive officers; and
|
|
|
•
|
administration of our equity compensation plans and
other similar plan and programs.
|
Compensation Committee Processes and Procedures
Typically, the Compensation Committee meets
at least two times annually and with greater frequency if necessary. The agenda for each meeting is usually developed by the Chairman
of the Compensation Committee, in consultation with certain executive officers, including the Chief Financial Officer. The Compensation
Committee meets regularly in executive session. However, from time to time, various members of management and other employees as
well as outside advisors or consultants may be invited by the Compensation Committee to make presentations, to provide financial
or other background information or advice or to otherwise participate in Compensation Committee meetings. The Chief Executive Officer
may not participate in, or be present during, any deliberations or determinations of the Compensation Committee regarding his compensation
or individual performance objectives. The charter of the Compensation Committee grants the Compensation Committee authority to
obtain, at the expense of the Company, advice and assistance from internal and external legal, accounting or other advisors and
consultants and other external resources that the Compensation Committee considers necessary or appropriate in the performance
of its duties. In particular, the Compensation Committee has the authority to retain compensation consultants to assist in its
evaluation of executive and director compensation, including the authority to approve the consultant’s reasonable fees and
other retention terms.
Historically, the Compensation Committee
has made most of the significant adjustments to annual compensation, determined bonus and equity awards and established new performance
objectives at one or more meetings held during the first half of the year. Generally, the Compensation Committee’s process
comprises two related elements: the determination of compensation levels and the establishment of performance objectives for the
current year. For executives other than the Chief Executive Officer, the Compensation Committee solicits and considers evaluations
and recommendations submitted to the Compensation Committee by the Chief Executive Officer. In the case of the Chief Executive
Officer, the evaluation of his performance is conducted by the Compensation Committee, which determines any adjustments to his
compensation as well as awards to be granted. For all executives and directors, as part of its deliberations, the Compensation
Committee may review and consider, as appropriate, materials such as financial reports and projections, operational data, tax and
accounting information, tally sheets that set forth the total compensation that may become payable to executives in various hypothetical
scenarios, executive and director stock ownership information, company stock performance data and analyses of historical executive
compensation levels and current Company-wide compensation levels.
Nominating and Corporate Governance
The Board does not have a standing nominating
and corporate governance committee. Instead, the independent members of the Board, currently consisting of Messrs. Elsey, McNay,
Noseda, and Bove, are responsible for performing key nominating and corporate governance activities on behalf of the Board, including
identifying, reviewing and evaluating candidates to serve as directors of the Company, reviewing and evaluating incumbent directors,
selecting candidates for election to the Board, making recommendations to the Board regarding the membership of the committees
of the Board, assessing the performance of management and developing and maintaining a set of corporate governance principles for
the Company.
In identifying and evaluating nominees
for director, the Board considers whether the candidate has the highest ethical standards and integrity and sufficient education,
experience and skills necessary to understand and wisely act upon the complex issues that arise in managing a publicly held company.
The Board also believes that it is essential that the Board members represent diverse viewpoints. To the extent the Board does
not have sufficient information to evaluate a candidate the Board may send a questionnaire to the candidate for completion with
sufficient time for Board consideration. The Board will annually assess the qualifications, expertise, performance and willingness
to serve of existing directors. If at this time or at any other time during the year the Board determines a need to add a new director
with specific qualifications or to fill a vacancy on the Board, a director designated by the Board will then initiate the search,
seeking input from other directors and senior management, and will also consider any nominees previously submitted by stockholders.
After identifying an initial slate of candidates satisfying the qualifications set forth above, the Board will then prioritize
the candidates and determine if other directors or senior management have relationships with the preferred candidates and can initiate
contacts. To the extent feasible, all of the members of the Board will interview the prospective candidates. Evaluations and recommendations
of the interviewers will be submitted to the whole Board for final evaluation. The Board will meet to consider such information
and to select candidates for appointment to the Board at the Annual Meeting. The independent members of the Board nominated the
six directors set forth in Proposal 1 for election at the 2019 Annual Meeting.
Nominations for Election to the Board
While the Board
will consider nominees recommended by stockholders, the Board has not actively solicited such nominations. The Board does not
intend to alter the manner in which it evaluates candidates based on whether or not the candidate was recommended by a
stockholder. Pursuant to the Company’s bylaws, nominations for election as directors by stockholders at a meeting of
stockholders called for the election of directors must be made in writing and delivered to the Company’s Secretary not
less than fourteen days nor more than fifty days prior to the date of the meeting. If, however, notice of the meeting is
given to stockholders less than twenty-one days prior to the meeting, the nominations must be received by the close of
business on the seventh day following the day on which notice of the meeting was mailed to stockholders. Each such notice
shall set forth, with respect to each nominee, (i) his or her name, age, business address and, if known, residence address,
(ii) his or her principal occupation or employment, and (iii) the number of shares
of stock of the Company beneficially owned by the nominee. As of the date of this proxy statement, the Company has not
received any such nominations from stockholders in connection with the Annual Meeting.
Stockholder Communications with the Board of Directors
The Company has established procedures
for its security holders to communicate directly with the Board on a confidential basis. Security holders who wish to communicate
with the Board or with a particular director may send a letter to the Secretary of the Company at 15245 Shady Grove Road, Suite
470, Rockville, Maryland 20850. The mailing envelope must contain a clear notation indicating that the enclosed letter is a “Security
Holder-Board Communication” or “Security Holder-Director Communication.” All such letters must identify the author
as a security holder and clearly state whether the intended recipients are all members of the Board or specified individual directors.
The Secretary will make copies of all such letters and circulate them to the directors addressed. If a security holder wishes the
communication to be confidential, such security holder must clearly indicate on the envelope that the communication is “confidential.”
The Secretary will then forward such communication, unopened, to the individual indicated.
Code of Ethics
We have adopted a corporate code of conduct
and ethics that applies to all of our employees, officers and directors, as well as a separate code of ethics that applies specifically
to our principal executive officer and principal financial officer. The corporate code of conduct and ethics and the code of ethics
for our principal executive and financial officers are available on our corporate website at www.regenerx.com. If we make any substantive
amendments to the corporate code of conduct and ethics or the code of ethics for our principal executive and financial officers,
or grant any waivers from a provision of these codes to any executive officer or director, we will promptly disclose the nature
of the amendment or waiver on our website.
PROPOSAL 2
APPROVAL, ON AN ADVISORY BASIS, OF NAMED EXECUTIVE OFFICER
COMPENSATION
The Dodd-Frank Wall Street Reform and Consumer
Protection Act and Section 14A of the Exchange Act require that we provide our stockholders with the opportunity to vote to approve,
on a nonbinding, advisory basis, the compensation of our named executive officers as disclosed in this Proxy Statement in accordance
with the compensation disclosure rules of the SEC.
We seek to closely align the interests
of our named executive officers with the interests of our stockholders. We have designed our compensation program to reward our
named executive officers for their individual performance and contributions to our overall business objectives.
The vote on this resolution is not intended
to address any specific element of compensation. Instead, the vote relates to the overall compensation of our named executive officers,
as described in this Proxy Statement in accordance with the compensation disclosure rules of the SEC.
Accordingly, we ask our stockholders to vote on the following
resolution at the Annual Meeting:
“RESOLVED, that the Company’s
stockholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in the Company’s
Proxy Statement for the Annual Meeting of Stockholders pursuant to the compensation disclosure rules of the Securities and Exchange
Commission, including the summary compensation table and the other related tables and disclosure.”
While the Board, and especially the Compensation
Committee, intend to carefully consider the results of the voting on this proposal when making future decisions regarding executive
compensation, the vote is not binding on the Company, the Compensation Committee or the Board and is advisory in nature. To the
extent there is any significant vote against the compensation of our named executive officers in this Proposal 2, the Compensation
Committee will evaluate what actions may be necessary to address our stockholders’ concerns.
VOTE REQUIRED
The Board recommends that you vote “FOR”
the non-binding advisory resolution approving the compensation of our named executive officers, as disclosed in this proxy statement.
Under applicable Delaware law, this proposal requires the affirmative vote of a majority of the shares present and entitled to
vote. This vote is advisory and is not binding on the Company, the Board or the Compensation Committee.
PROPOSAL 3
AMENDMENT TO RESTATED CERTIFICATE OF
INCORPORATION TO EFFECT AUTHORIZED SHARE INCREASE
By a written action in lieu of a meeting
executed on July 28, 2019, our Board of Directors approved a resolution authorizing and recommending that our stockholders approve
an amendment to the Company’s Restated Certificate of Incorporation, as amended to date (the “Certificate of Amendment”)
to (A) increase the number of authorized shares of capital stock from 201,000,000 shares to 251,000,000 shares, adding 50,000,000
authorized shares of Common Stock (being referred to as the “Authorized Share Increase”). The Authorized Shares Increase
will become effective upon filing of the Certificate of Amendment with the Delaware Secretary of State. The form of Certificate
of Amendment is attached as
Annex A
to this Information Statement.
Purpose of Authorized Share Increase
The Board has approved the Authorized Share
Increase, which would have the effect of increasing the number of authorized shares of capital stock from 201,000,000 shares to
251,000,000 shares, adding 50,000,000 authorized shares of Common Stock.
In addition to the 131,506,494 shares outstanding on the date
of this Proxy Statement, we have reserved:
|
|
·
|
9,921,250 shares of Common Stock for the issuance
upon exercise of currently outstanding options granted under our stock option plan;
|
|
|
·
|
3,610,130 shares of Common Stock for issuance upon
exercise of options which may be granted under our stock option plan;
|
|
|
·
|
10,420,594 shares of Common Stock for issuance upon
exercise of outstanding warrants currently held by investors;
|
|
|
·
|
10,833,333 shares of Common Stock for issuance upon
conversion of convertible promissory notes currently held by investors;
|
Therefore, as of the date of this Proxy
Statement, we only have 33,708,199 shares of Common Stock authorized and available for future issuance or reservation.
If the Authorized Share Increase is approved,
we will have 83,708,199 shares of Common Stock authorized and available for issuance or reservation.
Other Plans
Although at present we have no definitive
plans to issue any additional shares of capital stock, we desire to have more shares available to provide additional flexibility
to use our capital stock for business and financial purposes in the future. The additional shares may be used for various purposes
without further stockholder approval. Other purposes of future issuances of capital stock may include raising capital, establishing
strategic relationships or making acquisitions.
Rights of Common Stock
The additional common
stock to be authorized by the Authorized Share Increase would have rights identical to the currently outstanding Common Stock.
The Authorized Share Increase and any issuance of additional Common Stock will not affect the rights of the holders of our Common
Stock, except for the effects incidental to increasing the number of shares of Common Stock outstanding, such as dilution of the
earnings per share and voting rights of the holders of Common Stock. Shares of our Common Stock are not entitled to preemptive
rights.
Interests of our Executive Officers and Directors in the
Authorized Share Increase
No director or executive officer, or any
affiliate thereof, or any other person has any interest, direct, or indirect, by securing holdings or otherwise, in the Proposal
that is not shared by a majority of the stockholders of the Company.
Effective Date of the Authorized Share Increase
The Authorized Share Increase will become
effective immediately upon filing the Certificate of Amendment with the Secretary of State of the State of Delaware. The proposed
Certificate of Amendment is attached as
Annex A
hereto. We will determine when such filing will occur, but we anticipate
filing the Certificate of Amendment on or about October 1, 2019, after the date of the Annual Meeting.
Absence of Appraisal Rights
The approval by the Approving Stockholders
of the Proposal does not provide any stockholder any right to dissent and obtain appraisal of or payment for such Stockholder’s
shares under the Delaware General Corporation Law or our Certificate of Incorporation or Bylaws.
PROPOSAL 4
RATIFICATION OF SELECTION OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Audit Committee of the Board has selected
CohnReznick LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2019,
and has further directed that management submit the selection of the independent registered public accounting firm for ratification
by the stockholders at the Annual Meeting. CohnReznick, as its predecessor Reznick Group, P.C., has audited the Company’s
financial statements since 2000. Representatives of CohnReznick are expected to be present at the Annual Meeting. They will have
an opportunity to make a statement if they so desire and will be available to respond to appropriate questions.
Neither the Company’s Bylaws nor
other governing documents or law require stockholder ratification of the selection of CohnReznick as the Company’s independent
auditors. However, the Audit Committee is submitting the selection of CohnReznick to the stockholders for ratification as a matter
of good corporate practice. If the stockholders fail to ratify the selection, the Audit Committee will reconsider whether or not
to retain that firm. Even if the selection is ratified, the Audit Committee in its discretion may direct the appointment of different
independent auditors at any time during the year if they determine that such a change would be in the best interests of the Company
and its stockholders.
The affirmative vote of the holders of
a majority of the shares present in person or represented by proxy and entitled to vote at the Annual Meeting will be required
to ratify the selection of CohnReznick. Abstentions will be counted toward the tabulation of votes cast on proposals presented
to the stockholders and will have the same effect as negative votes. Broker non-votes are counted towards a quorum but are not
counted for any purpose in determining whether this matter has been approved.
Principal Accountant Fees and Services
The following table represents aggregate
fees billed to us for the fiscal years ended December 31, 2018 and 2017 by CohnReznick LLP, our independent registered public accounting
firm. All such fees described below were approved by the audit committee.
|
|
|
2018
|
|
|
2017
|
|
|
Audit fees
|
|
$
|
73,000
|
|
|
$
|
84,000
|
|
|
Tax fees
(1)
|
|
$
|
23,000
|
|
|
$
|
55,000
|
|
|
Total Fees
|
|
$
|
96,000
|
|
|
$
|
137,000
|
|
|
|
(1)
|
Tax fees include the preparation of our corporate
federal and state income tax returns.
|
Pre-Approval Policies and Procedures
Our audit committee has adopted a policy
and procedures for the pre-approval of audit and non-audit services rendered by our independent registered public accounting firm,
CohnReznick LLP. The policy generally pre-approves specified services in the defined categories of audit services, audit-related
services, and tax services up to specified amounts. Pre-approval may also be given as part of the audit committee’s approval
of the scope of the engagement of the independent registered public accounting firm or on an individual explicit case-by-case basis
before the independent registered public accounting firm is engaged to provide each service. On a periodic basis, the independent
registered public accounting firm reports to the audit committee on the status of actual costs for approved services against the
approved amounts.
The audit committee has determined that
the rendering of the services other than audit services by CohnReznick LLP is compatible with maintaining that firm’s independence.
VOTE REQUIRED
The Board recommends that you vote “FOR”
the ratification of the appointment of CohnReznick LLP as the Company’s independent registered public accounting firm for
the fiscal year ending December 31, 2019. Under applicable Delaware law, this proposal requires the affirmative vote of a majority
of the shares present and entitled to vote.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth certain
information regarding the ownership of our common stock as of July 29, 2019 by (i) each director; (ii) each of the named executive
officers; (iii) all executive officers and directors as a group; and (iv) all those known by us to be beneficial owners of more
than five percent of our common stock. The address for all directors and executive officers is c/o RegeneRx Biopharmaceuticals,
Inc., 15245 Shady Grove Road, Suite 470, Rockville, MD 20850.
|
|
|
Beneficial Ownership
(1)
|
|
|
Beneficial Owner
|
|
Number of Shares
|
|
|
Percent of Total
|
|
|
|
|
|
|
|
|
|
|
5% Stockholders:
|
|
|
|
|
|
|
|
|
Entities affiliated previously affiliated with Essetifin
S.p.A., Via Sudafrica, 20, Rome, Italy 00144
|
|
|
49,572,413
|
(2)
|
|
|
33.9
|
%
|
GtreeBNT Co., Ltd.
22nd FL, Parkview Tower, 248 Jungjail-ro, Bundang- gu, Seongnam-si, Gyeonggi-do 463-863, Republic of Korea
|
|
|
19,583,333
|
(3)
|
|
|
14.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Named Executive Officers and Directors:
|
|
|
|
|
|
|
|
|
|
J.J. Finkelstein
|
|
|
3,602,574
|
(4)
|
|
|
2.7
|
%
|
|
Allan L. Goldstein
|
|
|
3,025,710
|
(5)
|
|
|
2.3
|
%
|
|
Joseph C. McNay
|
|
|
7,564,955
|
(6)
|
|
|
5.7
|
%
|
|
Mauro Bove
|
|
|
839,583
|
(7)
|
|
|
*
|
|
|
R. Don Elsey
|
|
|
853,623
|
(8)
|
|
|
*
|
|
|
Alessandro Noseda
|
|
|
50,000
|
(9)
|
|
|
*
|
|
|
All directors and executive officers as a group (6 persons)
|
|
|
15,936,445
|
(10)
|
|
|
11.6
|
%
|
|
|
(1)
|
This table is based upon
information supplied by officers, directors and principal stockholders. Unless otherwise indicated in the footnotes to this table
and subject to community property laws where applicable, we believe that
each of the stockholders named in this table has
sole voting and investment power with respect to the shares indicated as beneficially owned. Applicable percentages are based
on 131,506,494 shares of common stock outstanding on July 29, 2019, adjusted as required by rules promulgated by the Securities
and Exchange Commission (the “SEC”).
|
|
|
(2)
|
Consists of 34,989,080 shares of common stock held of record
held by Essetifin S.p.A. (f/k/a Sigma-Tau Finanziaria, S.p.A.) (“Essetifin”), 8,333,333 shares of common stock issuable
upon conversion of a convertible promissory note and 6,250,000 upon the exercise of warrants. In each case exercisable within
60 days of July 29, 2019. Paolo Cavazza and members of his family directly and indirectly own 38% of Essetifin. The beneficial
ownership of Essetifin and its affiliates is derived from the Schedule 13D/A filed by Essetifin on March 14, 2018.
|
|
|
(3)
|
Consists of 19,583,333 shares of common stock held of record
by GtreeBNT which were acquired in two equity purchases in March 2014 and August 2014. The beneficial ownership of GtreeBNT is
derived from its Schedule 13D/A filed on April 1, 2015.
|
|
|
(4)
|
Consists of 1,637,991 shares of common stock held of record
by Mr. Finkelstein, 208,333 shares of common stock issuable upon conversion of convertible promissory notes, 156,250 shares of
common stock issuable upon exercise of warrants and 1,600,000 shares of common stock issuable upon exercise of options, in each
case exercisable within 60 days of July 29, 2019.
|
|
|
(5)
|
Consists of 1,712,793 shares of common stock held of record
by Dr. Goldstein, 41,667 shares of common stock issuable upon conversion of convertible promissory notes, 31,250 shares of common
stock issuable upon exercise of warrants and 1,240,000 shares of common stock issuable upon exercise of options, in each case
exercisable within 60 days of July 29, 2019.
|
|
|
(6)
|
Consists of 6,524,122 shares of common stock held of record
by Mr. McNay, 208,333 shares of common stock issuable upon conversion of convertible promissory notes, 156,250 shares of common
stock issuable upon exercise of warrants and 676,250 shares of common stock issuable upon exercise of options, in each case exercisable
within 60 days of July 29, 2019.
|
|
|
(7)
|
Consists of 83,333 shares of common stock issuable upon
conversion of convertible promissory notes, 62,500 shares of common stock issuable upon exercise of warrants and 693,750 shares
of common stock issuable upon exercise of options, in each case exercisable within 60 days of July 29, 2019.
|
|
|
(8)
|
Consists of 104,456 shares of common stock held of record,
41,667 shares of common stock issuable upon conversion of convertible promissory notes, 31,250 shares of common stock issuable
upon exercise of warrants and 676,250 shares of common stock issuable upon exercise of options, in each case exercisable within
60 days of July 29, 2019.
|
|
|
(9)
|
Consists of 50,000 shares of common stock issuable upon
exercise of options within 60 days of July 29, 2019.
|
|
|
(10)
|
Consists of 9,979,362 shares of common stock held of record,
583,333 shares of common stock issuable upon conversion of convertible promissory notes, 427,500 shares of common stock issuable
upon exercise of warrants and 4,936,250 shares of common stock issuable upon exercise of options, in each case exercisable within
60 days of July 29, 2019.
|
SECTION 16(A) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires
the Company’s directors and executive officers, and persons who own more than 10% of a registered class of our equity securities,
to file with the SEC initial reports of their ownership of our equity securities and reports of any subsequent changes in that
ownership. Specific due dates for these reports have been established by the SEC and the Company is required to disclose any late
filings or failures to file. Officers, directors and greater than 10% stockholders are required by SEC regulation to furnish the
Company with copies of all Section 16(a) forms they file. To the knowledge of the Company, based solely on its review of the copies
of such reports furnished to the Company, and written representations that no other reports were required, the Company believes
that during the past fiscal year its officers, directors and greater than ten percent beneficial owners complied with all Section
16(a) filing requirements.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table shows, for the fiscal
years ended December 31, 2018 and 2017, compensation awarded to or paid to, or earned by, our chief executive officer who was our
only named executive officers for fiscal 2018. For purposes of this report, we sometimes refer to our chief executive officer as
our named executive officer.
|
Name and Principal
|
|
|
Salary(1)
|
|
Bonus
|
|
|
Option
Awards(2)
|
|
|
All Other
Compensation(3)
|
|
|
Total
|
|
|
Position
|
|
Year
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
J.J. Finkelstein, President and
|
|
2018
|
|
|
102,399
|
|
|
|
—
|
|
|
|
38,809
|
|
|
|
3,360
|
|
|
|
144,568
|
|
|
Chief Executive Officer
|
|
2017
|
|
|
150,000
|
|
|
|
—
|
|
|
|
30,973
|
|
|
|
3,360
|
|
|
|
184.333
|
|
|
|
(1)
|
Mr. Finkelstein reduced his 2018 salary from $150,000 to
$125,000 in March 2018. Additionally, he forwent his October, November and December 2018 salary due to the limited cash held by
RegeneRx.
|
|
|
(2)
|
The 2018 & 2017 amounts reflect the aggregate total
grant date fair values (computed in accordance with FASB ASC Topic 718 or ASC Topic 505)
|
|
|
(3)
|
The 2018 & 2017 amount reflects payment of life insurance
premiums for Mr. Finkelstein in the amount of $3,360
|
Employment Agreement with Mr. Finkelstein
We entered into an employment agreement
with Mr. Finkelstein on April 16, 2014 for him to serve as our president and chief executive officer. Mr. Finkelstein’s employment
agreement has an initial three-year term, which is automatically renewed for additional one-year periods unless either we or Mr.
Finkelstein elect not to renew it. Mr. Finkelstein’s annual base salary was $125,000, which was increased to $150,000 on
January 1, 2015. Mr. Finkelstein’s salary may not be adjusted downward without his written consent, except in a circumstance
which is part of a general reduction or other concessionary arrangement affecting all employees or affecting senior executive officers.
Mr. Finkelstein is also eligible to receive an annual bonus in an amount established by the Board and is entitled to participate
in and receive all standard employee benefits and to participate in all of our applicable incentive plans, including stock option,
stock, bonus, savings and retirement plans. We also provide him with $1 million in life insurance.
Mr. Finkelstein is eligible to receive
options to purchase common stock under our equity incentive plans. The decision to grant any such options and the terms of such
options are within the discretion of our Board or the compensation committee thereof. All vested options are exercisable for a
period of time following any termination of Mr. Finkelstein’s employment as may be set forth in the applicable benefit plan
or in any option agreement between Mr. Finkelstein and us.
In the event that
Mr. Finkelstein’s employment is terminated by us without “cause” or by Mr. Finkelstein for “good reason,”
each as defined in his employment agreement, subject to Mr. Finkelstein’s entering into and not revoking a release of claims
in a form acceptable to us, Mr. Finkelstein will be entitled to receive (i) a lump sum payment in an amount equal to one-half
of his then annual base salary if within the first anniversary date of this Agreement; or (ii) a lump sum payment in an amount
equal to three-fourths of his then annual base salary if within the first anniversary date and second anniversary date of this
Agreement; or (iii) a lump sum payment in an amount equal to his then annual base salary if any time after the second anniversary
date of this Agreement, less all federal and state withholdings. In the event of a “change in control,” as defined
in his employment agreement and Mr. Finkelstein is involuntarily terminated within 12 months after a change in control event or
within 12 months after a change in control event he resigns his employment for “good reason”, then the Company shall
(i) pay Mr. Finkelstein, in a lump sum cash payment, an amount equal to his annual base salary in effect on the date of his termination
from employment, less any applicable federal and state taxes and withholdings. In addition, in each instance Mr. Finkelstein would
also be eligible to receive (i) any earned bonus and accrued vacation pay, and (ii) to the extent that he is eligible for and
participates in a Company sponsored health insurance plan the Company shall pay or reimburse Executive for the amount of any insurance
premiums for a twelve-month period, but these payments shall be limited to the amount of the premiums being paid by the Company
for Executive’s coverage or the amount being reimbursed for insurance premiums immediately prior to the date of his termination
from employment.
In addition, if Mr.
Finkelstein’s employment is terminated without “cause,” or if there is a “change in control” event,
in each case as defined in either the applicable benefit plan or in Mr. Finkelstein’s employment agreement, then the unvested
portion of Mr. Finkelstein’s outstanding options would accelerate in full.
Outstanding Equity Awards at December 31, 2018
The following table shows certain information
regarding outstanding equity awards at December 31, 2018 for the named executive officer, all of which were stock options granted
under our Amended and Restated 2000 Stock Option and Incentive Plan, our 2010 Equity Incentive Plan or our 2018 Equity Incentive
Plan.
|
|
|
Number of Shares
Underlying
Unexercised Options
(#)
|
|
|
Number of Shares
Underlying Unexercised
Options (#)
|
|
|
Option Exercise
Price
|
|
|
Option
|
|
|
|
|
Name
|
|
Exercisable
|
|
|
Unexercisable
|
|
|
($)
|
|
|
Expiration Date
|
|
Note
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mr. Finkelstein
|
|
|
114,748
|
|
|
|
—
|
|
|
|
0.57
|
|
|
4/10/2019
|
|
|
|
|
|
|
|
|
150,000
|
|
|
|
50,000
|
|
|
|
0.64
|
|
|
3/17/2023
|
|
|
(1
|
)
|
|
|
|
|
62,500
|
|
|
|
187,500
|
|
|
|
0.21
|
|
|
7/16/2028
|
|
|
(2
|
)
|
|
|
|
|
500,000
|
|
|
|
—
|
|
|
|
0.14
|
|
|
1/24/2019
|
|
|
|
|
|
|
|
|
35,000
|
|
|
|
—
|
|
|
|
0.16
|
|
|
4/4/2019
|
|
|
|
|
|
|
|
|
500,000
|
|
|
|
—
|
|
|
|
0.21
|
|
|
3/25/2021
|
|
|
|
|
|
|
|
|
500,000
|
|
|
|
—
|
|
|
|
0.36
|
|
|
6/30/2022
|
|
|
|
|
|
|
|
|
75,000
|
|
|
|
75,000
|
|
|
|
0.28
|
|
|
9/1/2027
|
|
|
(2
|
)
|
|
|
(1)
|
These options vest in equal installments upon grant and
on the first three anniversaries of the grant date. In each case these options were granted seven years prior to the listed expiration
dates.
|
|
|
(2)
|
These options vest in equal installments upon grant and
on the first three anniversaries of the grant date. In each case these options were granted ten years prior to the listed expiration
dates.
|
Post-Employment Compensation
We do not maintain any plans providing
for payment or other benefits at, following, or in connection with retirement other than a 401(k) plan which was available to all
employees through 2011. The Company did not make any plan contributions in 2017 or 2018. In addition, we do not maintain any non-qualified
deferred compensation plans.
Equity Compensation Plan Information
The following table provides information
as of December 31, 2018 about the securities authorized for issuance to our employees, directors and other eligible participants
under our equity compensation plans, consisting of the Amended and Restated 2000 Stock Option and Incentive Plan, the 2010 Equity
Incentive Plan and the 2018 Equity Incentive Plan.
|
Plan Category
|
|
Number of
Securities to be
issued upon exercise
of outstanding
options, warrants
and rights
(a)
|
|
|
Weighted-average
exercise equity
price of
outstanding
options, warrants
and rights
(b)
|
|
|
Number of securities
remaining available
for future issuance
under compensation
plans (excluding
securities reflected in
column (a))
(c)
|
|
|
Equity compensation plans approved by security holders
|
|
|
9,044,825
|
|
|
|
0.28
|
|
|
|
3,395,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans not approved by security holders
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
9,044,825
|
|
|
|
0.28
|
|
|
|
3,395,000
|
|
Director Compensation
The following table sets forth certain
information for the fiscal year ended December 31, 2018 with respect to the compensation of our directors. Mr. Finkelstein’s
compensation is disclosed in the Summary Compensation Table above, and he does not receive any additional compensation for his
service as a director. Dr. Goldstein is an employee of our company and his compensation as an employee is set forth in the table
below. He does not receive any additional compensation for his service as a director.
The Company had in effect a non-employee
director compensation policy which was suspended in November 2011 by our Board of Directors elected to help the company preserve
capital and consistent with this, certain fees accrued in 2011 were forfeited and no retainer or meeting fees were paid to non-employee
directors in 2018 or 2017.
In 2018, each independent director was
granted options to purchase 200,000 shares of common stock at an exercise price of $0.21 per share, which vests in four segments
pursuant to each director’s continued service. In 2017, each independent director was granted options to purchase 125,000
shares of common stock with an exercise price per share of $0.28. These option grants vests in four segments pursuant to each director’s
continued service. These option grants were the only compensation received by non-employee directors in 2018 and 2017.
We also reimburse directors for expenses
incurred in attending meetings of the board and other events attended on our behalf and at our request.
Director Compensation for Fiscal 2018
|
|
|
Fees Earned
|
|
|
|
|
|
|
|
|
|
|
|
|
|
or Paid
|
|
|
Option
|
|
|
All Other
|
|
|
|
|
|
|
|
in Cash
|
|
|
Awards
|
|
|
Compensation
|
|
|
Total
|
|
|
Name
|
|
($)(1)
|
|
|
($)
|
|
|
($)
|
|
|
($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allan Goldstein, Ph.D.
|
|
|
—
|
|
|
|
38,809
|
|
|
|
90,000
|
(2)
|
|
|
128,809
|
|
|
R. Don Elsey
|
|
|
—
|
|
|
|
31,047
|
|
|
|
—
|
|
|
|
31,047
|
|
|
Joseph McNay
|
|
|
—
|
|
|
|
31,047
|
|
|
|
—
|
|
|
|
31,047
|
|
|
Mauro Bove
|
|
|
—
|
|
|
|
31,047
|
|
|
|
—
|
|
|
|
31,047
|
|
|
|
(1)
|
Options held by each Board member as of December 31, 2018,
are as follows:
|
|
Allan Goldstein, Ph.D.
|
|
|
1,706,942
|
|
|
R. Don Elsey
|
|
|
795,000
|
|
|
Joseph McNay
|
|
|
803,024
|
|
|
Mauro Bove
|
|
|
832,155
|
|
|
|
(2)
|
In addition to being Chairman of our Board of Directors,
Dr. Goldstein also serves as our Chief Science Officer. In this capacity, Dr. Goldstein received cash compensation of $90,000
in 2018. In 2018 Dr. Goldstein was also granted options to purchase 250,000 shares of common stock.
|
We entered into an employment agreement
with Dr. Goldstein on April 16, 2014 for him to serve as our Chief Science Officer. Dr. Goldstein’s employment agreement
had an initial one-year term, which has been and will be automatically renewed for additional one-year periods unless either we
or Mr. Goldstein elect not to renew it. Dr. Goldstein’s annual base salary was $75,000 and was increased to $90,000 on January
1, 2015. Dr. Goldstein’s salary may not be adjusted downward without his written consent, except in a circumstance which
is part of a general reduction or other concessionary arrangement affecting all employees or affecting senior executive officers.
Dr. Goldstein is also eligible to receive an annual bonus in an amount established by the Board and is entitled to participate
in and receive all standard employee benefits and to participate in all of our applicable incentive plans, including stock option,
stock, bonus, savings and retirement plans.
Dr. Goldstein is eligible to receive options
to purchase common stock under our equity incentive plans. The decision to grant any such options and the terms of such options
are within the discretion of our Board or the compensation committee thereof. All vested options are exercisable for a period of
time following any termination of Dr. Goldstein’s employment as may be set forth in the applicable benefit plan or in any
option agreement between Dr. Goldstein and us.
We also reimburse directors for expenses incurred in attending
meetings of the board and other events attended on our behalf and at our request.
Rule 10b5-1 Trading Plans
Our directors and executive officers may
adopt written plans, known as Rule 10b5-1 plans, in which they will contract with a broker to buy or sell shares of our common
stock on a periodic basis. Under a Rule 10b5-1 plan, a broker executes trades pursuant to parameters established by the director
or officer when entering into the plan, without further direction from the director or officer. The director or officer may amend
or terminate the plan in some circumstances. Our directors and executive officers may also buy or sell additional shares outside
of a Rule 10b5-1 plan when they are not in possession of material, nonpublic information.
CERTAIN RELATIONSHIPS AND RELATED PARTY
TRANSACTIONS
Related Party Transactions
Described below are transactions and series
of similar transactions that have occurred during fiscal 2018 to which we were a party or are a party in which:
|
|
•
|
the amounts involved exceeded or will exceed $120,000;
and
|
|
|
•
|
a director, executive officer, beneficial owner of more
than five percent of any class of our voting securities or any member of their immediate family had or will have a direct or indirect
material interest.
|
GtreeBNT
In August 2017, the Company and GtreeBNT
reached an agreement to expand the territorial definition of the RGN-137 License Agreement in Japan in exchange for a series of
payments, two of which were received in 2017 with the remaining two were received in 2018. Under the amendment the Territory was
expanded to include Europe, Canada, South Korea, Australia and Japan.
U.S. Joint Venture
On January 28, 2015, we announced that
we had entered into a Joint Venture Agreement with GtreeBNT a shareholder of the Company. ReGenTree, LLC was created under the
Agreement and is jointly owned by us and GtreeBNT. ReGenTree intends to commercialize RGN-259 for treatment of dry eye and neurotrophic
keratopathy, an orphan indication in the United States. GtreeBNT will be responsible for funding all product development and commercialization
efforts and holds a majority interest in ReGenTree that varies depending on development milestones achieved and eventual commercialization
path, if successful. In conjunction with the Joint Venture Agreement, we also entered into a royalty-bearing license with ReGenTree
pursuant to which we granted to ReGenTree the right to develop and exclusively commercialize RGN-259 in the United States. We received
a total of $1 million in two tranches under the terms of the License Agreement. The first tranche of $500,000 was received in March
2015 and a second in the amount of $500,000, was received in September 2015. On April 6, 2016, we received $250,000 from ReGenTree
and executed an amendment to the license agreement on April 28, 2016. Under the amendment, the territorial rights were expanded
to include Canada.
Our initial ownership interest in ReGenTree
was 49% and has been reduced to 38.5% after filing of the final clinical study report with the FDA for the Phase 3 trial for Dry
Eye Syndrome completed in 2017. Based on when, and if, ReGenTree achieves certain additional development milestones in the U.S.
with RGN-259, our equity ownership may be incrementally reduced to between 38.5% and 25%, with 25% being the final equity ownership
upon FDA approval of an NDA for Dry Eye Syndrome in the U.S. In addition to our equity ownership, RegeneRx retains a royalty on
net sales that varies between single and low double digits, depending on whether commercial sales are made by ReGenTree or a licensee.
In the event ReGenTree is acquired, or a change of control occurs following achievement of an NDA, RegeneRx shall be entitled to
a minimum of 40% of all proceeds paid or payable and will forgo any future royalties.
In September 2015, ReGenTree began a Phase
2/3 clinical trial in patients with dry eye syndrome (“DES”) and a Phase 3 clinical trial in patients with neurotrophic
keratopathy (“NK”), both in the U.S. In May 2016, we reported the results of the 317-patient Phase 2/3 trial (ARISE-1).
The FDA approved ReGenTree’s Phase 3 protocol for DES in late summer 2016 and we initiated a second Phase 3 trial (ARISE-2)
that was completed in approximately 600 patients, the results of which have been reported elsewhere in this document.
The NK trial (SEER-1),
a smaller study in an orphan population, has enrolled seventeen patients thus far, and has several additional patients being screened,
with a goal of forty-six. In 2018, ReGenTree disclosed that 7 of 17 patients enrolled SEER-1 have completely healed. While these
preliminary observations are encouraging, it should be noted that the patients and treating physicians remain masked while the
trial is on-going, so it is not known whether the healed patients are in the RGN-259 group, placebo group, or distributed among
both. It is not known when this study will be completed.
HOUSEHOLDING OF PROXY MATERIALS
The SEC has adopted rules that permit companies
and intermediaries (e.g., brokers) to satisfy the delivery requirements for Notices of Internet Availability of Proxy Materials
or other Annual Meeting materials with respect to two or more stockholders sharing the same address by delivering a single Notice
of Internet Availability or other Annual Meeting materials addressed to those stockholders. This process, which is commonly referred
to as “householding,” potentially means extra convenience for stockholders and cost savings for companies.
This year, a number of brokers with account
holders who are stockholders of the Company will be “householding” the Company’s proxy materials. A single Notice
of Internet Availability of Proxy Materials will be delivered to multiple stockholders sharing an address unless contrary instructions
have been received from the affected stockholders. Once you have received notice from your broker that they will be “householding”
communications to your address, “householding” will continue until you are notified otherwise or until you revoke your
consent. If, at any time, you no longer wish to participate in “householding” and would prefer to receive a separate
Notice of Internet Availability of Proxy Materials, please notify your broker. Direct your written request to the Company’s
Secretary at 15245 Shady Grove Road, Suite 470, Rockville, Maryland 20850. Stockholders who currently receive multiple copies of
the Notices of Internet Availability of Proxy Materials at their addresses and would like to request “householding”
of their communications should contact their brokers.
FORM 10-K INFORMATION
A COPY OF THE COMPANY’S ANNUAL REPORT
ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2018 (WITHOUT EXHIBITS), ACCOMPANIES THIS NOTICE OF MEETING AND PROXY STATEMENT.
NO PART OF THE ANNUAL REPORT IS INCORPORATED HEREIN AND NO PART THEREOF IS TO BE CONSIDERED PROXY SOLICITING MATERIAL. THE COMPANY
WILL FURNISH WITHOUT CHARGE TO EACH PERSON WHOSE PROXY IS BEING SOLICITED, UPON WRITTEN REQUEST OF ANY SUCH PERSON, ANY EXHIBIT
DESCRIBED IN THE LIST ACCOMPANYING THE FORM 10-K, UPON THE PAYMENT, IN ADVANCE, OF REASONABLE FEES RELATED TO THE COMPANY’S
FURNISHING SUCH EXHIBIT(S). REQUESTS FOR COPIES OF SUCH EXHIBIT(S) SHOULD BE DIRECTED TO THE COMPANY’S SECRETARY AT 15245
SHADY GROVE ROAD, SUITE 470, ROCKVILLE, MARYLAND 20850.
OTHER MATTERS
The Board knows of no other matters that
will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, it is
the intention of the persons named in the accompanying proxy to vote on such matters in accordance with their best judgment.
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By Order of the Board of Directors
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Allan L. Goldstein, Ph.D.
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Chairman of the Board
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Rockville, Maryland
August [—], 2019
REGENERX
BIOPHARMACEUTICALS, INC. 15245 SHADY GROVE ROAD, SUITE 470 ROCKVILLE, MD 20850 Investor Address Line 11 OF 2 1 1 Investor Address
Line 2 Investor Address Line 3 Investor Address Line 4 Investor Address Line 5 1234 ANYWHERE STREET ANY CITY, ON A1A 1A1 VOTE
BY INTERNET - www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information.
Vote by 11:59 P.M. ET on 09/26/2019. Have your proxy card in hand when you access the web site and follow the instructions to
obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you
would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy
statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please
follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy
materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting
instructions. Vote by 11:59 P.M. ET on 09/26/2019. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote
Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.NAME THE COMPANY NAME INC. - COMMON THE COMPANY NAME INC. - CLASS
A THE COMPANY NAME INC. - CLASS B THE COMPANY NAME INC. - CLASS C THE COMPANY NAME INC. - CLASS D THE COMPANY NAME INC. - CLASS
E THE COMPANY NAME INC. - CLASS F THE COMPANY NAME INC. - 401 K CONTROL # 0000000000000000SHARES 123,456,789,012.12345 123,456,789,012.12345
123,456,789,012.12345 123,456,789,012.12345 123,456,789,012.12345 123,456,789,012.12345 123,456,789,012.12345 123,456,789,012.12345
PAGE1 OF 2TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:KEEP THIS PORTION FOR YOUR RECORDSDETACH AND RETURN THIS
PORTION ONLYTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. The Board of Directors recommends you vote FOR the following:1.
Election of Directors Nominees 01 Allan L. Goldstein 02 J.J. Finkelstein 03 Joseph C. McNay 04 Mauro Bove06 Alessandro Noseda
For Withhold For All All All Except To withhold authority to vote for any individual nominee(s), mark “For All Except”
and write the number(s) of the nominee(s) on the line below.05 R. Don Elsey The Board of Directors recommends you vote FOR proposals
2, 3 and 4.2 To approve, on a non-binding basis, named executive officer compensation. 3 To approve amendment to certificate to
increase authorized shares by 50,000,000. 4 Proposal to ratify the appointment of Cohn Reznick LLP as the independent registered
public accounting firm of the Company for fiscal year 2019. NOTE: Such other business as may properly come before the meeting
or any adjournment thereof. For Against Abstain Please sign exactly as your name(s) appear(s) hereon. When signing as attorney,
executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders
must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. For address
change/comments, mark here. (see reverse for instructions)Please indicate if you plan to attend this meeting HOUSEHOLDING ELECTION
- Please indicate if you consent to receive certain future investor communications in a single package per household Yes No0000428089
1 R1.0.1.18Investor Address Line 1Investor Address Line 2Investor Address Line 3 Investor Address Line 4Investor Address Line
5John Sample1234 ANYWHERE STREETANY CITY, ON A1A 1A1Signature [PLEASE SIGN WITHIN BOX] Date JOB #Signature (Joint Owners) Date
SHARES CUSIP # SEQUENCE #
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement and Form 10-K are
available at www.proxyvote.comREGENERX BIOPHARMACEUTICALS, INC. Annual Meeting of Shareholders September 27, 2019 11:00 AM This
proxy is solicited by the Board of Directors The shareholder(s) hereby appoint(s) J.J. Finkelstein, as proxy, with the power to
appoint his substitute, and hereby authorizes them to represent and to vote, as designated on the reverse side of this ballot,
all of the shares of Common stock of REGENERX BIOPHARMACEUTICALS, INC. that the shareholder(s) is/are entitled to vote at the
Annual Meeting of shareholder(s) to be held at 11:00 AM, EDT on September 27, 2019 at the 15245 Shady Grove Road Rockville, MD
20850, and any adjournment or postponement thereof. This proxy, when properly executed, will be voted in the manner directed herein.
If no such direction is made, this proxy will be voted in accordance with the Board of Directors’ recommendations. Address
change/comments:0000428089_2 R1.0.1.18(If you noted any Address Changes and/or Comments above, please mark corresponding box on
the reverse side.) Continued and to be signed on reverse side
Annex A
CERTIFICATE OF AMENDMENT OF RESTATED
CERTIFICATE OF INCORPORATION OF
REGENERX BIOPHARMACEUTICALS, INC.
RegeneRx Biopharmaceuticals, Inc.
, a corporation organized
and existing under and by virtue of the General Corporation Law of the State of Delaware (the “Corporation”), hereby
certifies that:
FIRST:
The name of the Corporation is RegeneRx Biopharmaceuticals,
Inc.
SECOND:
The original name of the Corporation is Alpha
1 Biomedicals, Inc. and the date of filing the original Certificate of Incorporation of the Corporation with the Secretary of State
of the State of Delaware was May 13, 1982.
THIRD:
The Board of Directors of the Corporation, acting
in accordance with the provisions of Sections 141 and 242 of the General Corporation Law of the State of Delaware, adopted resolutions
amending its Restated Certificate of Incorporation as follows:
Article 4 shall be amended and restated to read in its entirety
as follows:
“4.
Authorized Capital Stock
. The total number
of shares of capital stock which the Corporation shall have the authority to issue is Two Hundred and Fifty One Million (251,000,000)
shares divided into two classes of which One Million (1,000,000) shares of the par value of $.001 per share shall be designated
Preferred Stock and Two Hundred and Fifty Million (250,000,000) shares of the par value of $.001 per share shall be designated
Common Stock.”
FOURTH:
That thereafter, pursuant to a resolution of
the Board of Directors, at the annual meeting of the stockholders of the Corporation that was duly called and held upon notice
in accordance with Section 222 of the General Corporation Law of Delaware of the Company, by the holders of outstanding stock of
the Corporation having not less than the minimum number of votes that would be necessary to approve this Certificate of Amendment
at a meeting at which all shares entitled to vote thereon were present and voting.
FIFTH:
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.
IN WITNESS WHEREOF
, RegeneRx Biopharmaceuticals, Inc.
has caused this Certificate of Amendment to be signed by its President and attested to by its Secretary this
day of
October, 2019.
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RegeneRx Biopharmaceuticals, Inc.
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By:
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J.J. Finkelstein, President
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