Athersys Inc., the Cleveland-based regenerative medicine company, has postponed its annual meeting for more than a month to add a shareholder proposal authorizing the company's board to effect a reverse stock split of its shares.
The reverse split, which would combine a yet-to-be-determined number of the company's shares, would help Athersys meet the minimum share price required for listing by the Nasdaq Stock Market.
On March 18, Athersys received a notice from Nasdaq that its shares had fallen below $1 per share for 30 consecutive business days, according to a company statement. Nasdaq gave Athersys until Sept. 14 to regain compliance with the bid price requirement, Athersys said.
A reverse stock split would solve this noncompliance, at least initially.
"The company believes that being able to effect a reverse stock split is in the best interests of Athersys and its stockholders by allowing the company more flexibility to, among other things, potentially improve the marketability and liquidity of its common stock and avoid the possibility of noncompliance with the listing requirements of the Nasdaq Stock Market LLC, which will allow management to focus on executing its business strategy," Athersys said in its statement.
The company also said it plans to ask shareholders at their annual meeting, which has been rescheduled to July 28, to approve a smaller slate of directors — down to five from nine after one director chose not to stand for reelection.
The board also approved paying directors in Athersys stock options in lieu of cash retainers, beginning in the fourth quarter of 2022, the company said.
Last week, Athersys said it would cut its workforce by as much as 70% — including three of its top executives — in a restructuring aimed at reducing costs and making the company an attractive investment for potential financial or strategic partners.
The restructuring also is intended to slow the company's cash burn and accelerate a shift in its leadership and operations toward the commercialization of its adult stem cell therapy, MultiStem, and away from the product's research and development.
Athersys has been developing MultiStem adult stem cell therapy since 1994 and is in late-stage clinical trials with its Japanese partner, Healios K.K., to commercialize the therapy to treat ischemic stroke patients in Japan.
Athersys shares (Nasdaq: ATHX) were down 10.5% to 34.2 cents in late morning trading on Thursday.
