Company: PGEN
Filing Date: 2025-05-06
Form Type: PRE 14A
Source: 0001140361-25-017535
Chunk: 39

Company: PRECIGEN, INC.
Filing Date: 2025-05-06
Form: PRE 14A
Chunk 39
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 Board, except that for the first two years following the issue date of the Series A Preferred Stock, such dividends will be paid in kind (the “PIK Dividends”) in the form of an increase to the stated value and the liquidation preference of the Series A Preferred Stock by the amount of such dividends, together with Warrants to acquire a number of additional shares of Common Stock equal to 50% of the amount of such dividends divided by the Exercise Price. The Proposal We are asking our shareholders to consider and approve the issuance of shares of Common Stock as payment of the PIK Dividends to Randal J. Kirk, in order for Mr. Kirk to receive PIK Dividends on the Series A Preferred Stock on the same terms as the other investors. Nasdaq Listing Rule 5635(c) (“Nasdaq Rule 5635(c)”) requires shareholder approval “prior to the issuance of securities when a stock option or purchase plan is to be established or materially amended or other equity compensation arrangement made or materially amended, pursuant to which stock may be acquired by officers, directors, employees or consultants”, subject to certain exceptions set forth therein. For this purpose, the Nasdaq staff has said that common stock, or securities convertible into or exercisable for common stock, issued to a company’s officers, directors, employees or consultants at a discount to the market value of such common stock is a form of “equity compensation” requiring shareholder approval under Nasdaq Rule 5635(c), unless the issuance is part of a public offering. “Market value” for this purpose means the consolidated closing bid price (as reflected on Nasdaq) immediately preceding the time that the company enters into a binding agreement with such officer, director, employee or consultant to issue the equity compensation. The PIK Dividends may be considered equivalent to issuances of additional shares of Series A Preferred Stock and additional Warrants to Mr. Kirk and may therefore be considered “equity compensation” under Nasdaq Rule 5635(c). In addition, it is possible that on the PIK Dividend payment dates, the Initial Conversion Price of the Series A Preferred Stock and/or the Exercise Price of the Warrants will be below the market value of our Common Stock. Even though all investors who participated in the Private Placement received the same Preferred Stock and Warrants and are entitled to PIK Dividends as well, because Mr. Kirk is a director of our Board, the PIK Dividends to him may be subject to Nasdaq Rule