Company: HCWB
Filing Date: 2025-02-11
Form Type: PRE 14A
Source: 0001193125-25-024372
Chunk: 17

Company: HCW Biologics Inc.
Filing Date: 2025-02-11
Form: PRE 14A
Chunk 17
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 Reverse Stock Split may have serious, adverse effects on the Company and its stockholders. Increase the Per Share Price of Common Stock If the Board chooses to effect the Reverse Stock Split, we believe it would increase the per share price of the common stock. In determining to seek authorization for this proposal, the Board considered that, by effectively condensing a number of pre-splitshares into one share of common stock, the market price of a post-split share should generally be greater than the current market price of a pre-splitshare. Maintain the Marketability and Liquidity of the Common Stock The Board believes that the increased market price of the common stock expected as a result of implementing the Reverse Stock Split could improve the marketability and liquidity of the common stock and encourage interest and trading in the common stock. For example, certain practices and policies favor higher-priced securities listed on a national securities exchange, like Nasdaq, over lower-priced securities quoted on the over-the-countermarkets: 9

| • |     | Stock Price Requirements: Many brokerage firms have internal policies and practices that have the                                                                                                                                                       
 effect of discouraging individual brokers from recommending lower-priced securities to their clients. Many institutional investors have policies prohibiting them from holding lower-priced securities in their portfolios, which reduces the number of 
 potential purchasers of the common stock. Investment funds may also be reluctant to invest in lower-priced securities.                                                                                                                                  |

| • |     | Stock Price Volatility: A higher stock price may increase the acceptability of the common stock to                                                                                                                                                        
 a number of long-term investors who may not find the common stock attractive at its current prices due to the trading volatility often associated with securities below certain prices. Moreover, the analysts at many brokerage firms do not monitor the 
 trading activity or otherwise provide coverage of lower-priced securities.                                                                                                                                                                                |

| • |     | Transaction Costs: Investors may be dissuaded from purchasing securities below certain prices                            
 because brokers’ commissions, as a percentage of the total transaction value, can be higher for lower-priced securities. |

| • |     | Access to Capital Markets: If our appeal of the Nasdaq staff determination to delist our common                                                                                                                                                    
 stock is not successful or we are unable to regain compliance with the Minimum Bid Price Rule and our common stock is delisted from Nasdaq, investor demand for additional shares of our common stock would be limited, thereby preventing us from 
 accessing the public equity markets as a strategy to raise additional capital.                                                                                                                                                                     |

We believe that the Reverse Stock Split, if effected, could increase analyst and broker interest in our