DEF: Pluri Inc. Schedules Annual Shareholder Meeting for June 2025, Seeks Approval for Director Elections, Equity Plan, and Private Placement Warrants

Pluri Inc. has announced its annual shareholder meeting for June 30, 2025, where key proposals include the election of six directors, ratification of its independent auditor, approval of an amended equity compensation plan, and a crucial vote on the exercise of warrants from a recent $6.5 million private placement.

Summary

• Pluri Inc. will hold its annual shareholder meeting on June 30, 2025, at its offices in Haifa, Israel, to address several key corporate matters.
• Shareholders will vote on the election of six directors, including current Chairman Zami Aberman and newly appointed director Alexandre Weinstein.
• The company seeks ratification of Kesselman & Kesselman (PricewaterhouseCoopers) as its independent registered public accounting firm for Fiscal Year 2025.
• A proposal to approve the Amended and Restated 2016 Equity Compensation Plan will be presented, aiming to attract and retain key talent through equity-based incentives, with annual awards not exceeding 2.75% of fully diluted common shares.
• Shareholders will cast non-binding advisory votes on named executive officer compensation and the frequency of future advisory votes on compensation, with the Board recommending a biennial frequency.
• A significant proposal involves approving the exercise of Common Warrants and Pre-Funded Warrants to purchase up to 1,086,768 common shares, issued in a private placement to an entity owned by Mr. Alexandre Weinstein, to comply with Nasdaq Listing Rule 5635(d).
• The private placement, which closed on February 5, 2025, generated gross proceeds of $6.5 million for working capital and general corporate purposes.
• The company reported a net loss of $21,344,000 for Fiscal Year 2024, a 26% decrease from the $28,887,000 net loss in Fiscal Year 2023, primarily due to reduced R&D and G&A expenses.
• Total Shareholder Return (TSR) for the two-year period ended June 30, 2024, was $(2,590), following $(2,528) for the period ended June 30, 2023.
• Executive compensation for CEO Yaky Yanay decreased from $2,628,215 in FY2023 to $741,479 in FY2024, while CFO Chen Franco-Yehuda's compensation increased from $375,239 to $492,366 over the same period.
• Both the CEO and former CFO experienced a 20% monthly cash salary reduction in late 2023/early 2024 due to the ongoing conflict in Israel.
• Liat Zalts was appointed as the new CFO and Treasurer effective September 30, 2024, replacing Chen Franco-Yehuda who resigned.

Sentiment

Score: 6

Explanation: The document presents a mixed sentiment. Positives include a significant reduction in net loss and a successful capital raise. However, the negative Total Shareholder Return, the need for shareholder approval for warrant exercise (indicating potential dilution), and the impact of the Israel conflict on executive salaries introduce elements of caution. The primary purpose is procedural (proxy statement), so it's not overtly positive or negative, but the financial improvements lean slightly positive.

Positives

• The company's net loss decreased by 26% from $28,887,000 in Fiscal Year 2023 to $21,344,000 in Fiscal Year 2024, driven by reduced research and development and general and administrative expenses, and an increase in financial income.
• The private placement offering successfully raised $6.5 million in gross proceeds, providing working capital and supporting general corporate purposes.
• The Board of Directors maintains a strong corporate governance structure with separate Chairman and CEO roles, and four standing committees (Audit, Compensation, Investment, Nominating) with independent members.
• The proposed Amended and Restated 2016 Equity Compensation Plan aims to enhance the company's ability to attract, motivate, and retain highly qualified employees and directors, which is crucial for long-term success.

Negatives

• The company continues to report a significant net loss of $21,344,000 for Fiscal Year 2024.
• The Total Shareholder Return (TSR) remained negative, showing a cumulative return of $(2,590) for the two-year period ended June 30, 2024.
• Executive cash salaries were reduced by 20% for several months in late 2023 and early 2024 due to the ongoing conflict in Israel, indicating operational challenges.
• The exercise of warrants from the private placement, totaling up to 1,086,768 common shares, requires shareholder approval to comply with Nasdaq rules, and failure to obtain this approval would prevent holders from exercising these warrants, potentially impacting investor confidence and future capital access.

Risks

• Failure to obtain shareholder approval for the exercise of Common Warrants and Pre-Funded Warrants could prevent holders from exercising these securities, potentially impacting the company's capital structure and investor relations.
• The ongoing conflict in Israel has led to salary reductions for executive officers, indicating potential operational and financial impacts on the company's stability.
• The company's ability to attract, motivate, and retain experienced and highly qualified employees and directors is dependent on the approval of the Amended and Restated 2016 Equity Compensation Plan.
• The company's financial stability is challenged by continued net losses, although these have decreased year-over-year.

Future Outlook

The document primarily focuses on corporate governance and shareholder voting matters for the upcoming annual meeting. It indicates the company's intention to continue using equity-based compensation to attract and retain talent and to maintain its current board structure. The successful private placement provides working capital for general corporate purposes, suggesting continued operations and strategic initiatives. The Board recommends holding advisory votes on executive compensation every two years, indicating a consistent approach to shareholder engagement on this matter.

Management Comments

• "We believe that Mr. Aberman’s qualifications to sit on our Board include his unique multidisciplinary innovative approach, years of experience in the financial markets in Israel and globally, as well as his experience in serving as the Chief Executive Officer of publicly traded entities."
• "We believe that Mr. Weinstein’s qualifications to sit on our Board include his years of experience in leading high-growth organizations, his vast skill and expertise in strategic investments and business development, as well as his knowledge and familiarity with the pharmaceutical, biotechnology, and sustainable technology sectors."
• "We believe that Mr. Birger’s qualifications to sit on our Board include his extensive experience in the high-tech sector and life-science industry, his experience serving as Chairman, CEO and a director of public companies, his vast skill and expertise in accounting and economics as well as his knowledge and familiarity with corporate finance."
• "We believe that Ms. Shemesh-Rasmussen’s qualifications to sit on our Board include her experience in marketing for pharmaceutical companies, science, business development and investment banking."
• "We believe that Mr. Levi’s qualifications to sit on our Board include his experience in strategic planning, business development and activities in the government sector."
• "We believe that Mr. Yanay’s qualifications to sit on our Board include his years of experience in the medical technology industry, his vast skill and expertise in accounting and economics, as well as his knowledge and familiarity with corporate finance."
• "We believe that this structure provides an efficient and effective leadership model for the Company to enable us to deliver better results and explore opportunities for the company and its investors."
• "We believe that having different persons serving as Chairman and CEO, together with three independent directors is the optimal Board structure to provide independent oversight and management accountability while ensuring that our strategic plans are pursued to optimize long-term shareholder value."
• "The Board values the opinions expressed by shareholders, and will consider the outcome of the vote when making future compensation decisions for our named executive officers."
• "In December 2023, in light of the ongoing conflict in Israel and challenges in predicting its resolution and the subsequent impact on the Company’s operations, and in order to ensure the Company’s financial stability, the Board approved, at the recommendation of the Company’s management, (i) a 20% monthly cash salary reduction in the amount of 39,600 NIS to Mr. Yanay, our CEO, for the months of January 2024 and February 2024, (ii) a 20% cash salary reduction in the amount of 39,000 NIS to Mrs. Franco-Yehuda, our CFO, for the months of December 2023, January 2024 and February 2024."

Industry Context

Pluri Inc. operates within the biotechnology and life sciences industry, with a focus on cellular therapeutics and cultivated food solutions (via its subsidiary Ever After Foods Ltd.). The company's board composition reflects this, with directors possessing extensive experience in pharmaceuticals, biotechnology, high-tech, and strategic investments. The ongoing conflict in Israel, as noted by management, presents a regional challenge that can impact operations and financial stability for companies based there, potentially affecting industry-specific activities like clinical studies and R&D.

Comparison to Industry Standards

• The company's net loss reduction from $41.37 million in FY2022 to $21.34 million in FY2024, driven by completion/termination of clinical studies, suggests a strategic shift or completion of high-cost phases, which can be a common trajectory for biotech companies as they advance or conclude specific R&D programs. Without specific industry benchmarks for similar-stage biotech companies, a direct comparison of the magnitude of loss reduction is difficult.
• The private placement raising $6.5 million, while providing capital, is a relatively modest amount for a biotech company, especially one engaged in cellular therapeutics, which typically require substantial funding for R&D and clinical trials. Larger, more advanced biotech firms often secure hundreds of millions in funding rounds.
• The negative Total Shareholder Return (TSR) of $(2,590) for FY2024 indicates underperformance relative to a positive return expectation, which is common in early-stage or clinical-stage biotech companies due to inherent risks and long development cycles, but contrasts with the positive returns seen in the broader market or successful biotech peers during periods of growth.
• The company's equity compensation plans (2016 and 2019 Plans) allowing for up to 2.75% and 16% of fully diluted shares respectively, are within typical ranges for biotech companies that rely heavily on equity incentives to attract and retain specialized talent, comparable to practices at companies like Gilead Sciences or Amgen, though the specific percentages vary by company size and stage.

Management Changes

Corporate Governance

Related Party Transactions

• The private placement offering involved a company wholly beneficially owned by Mr. Alexandre Weinstein, who became a director of Pluri Inc. in February 2025. This transaction included the issuance of Common Shares, Pre-Funded Warrants, and Common Warrants, and later an exchange of Common Shares for Additional Pre-Funded Warrants.

Stakeholder Impact

• **Shareholders:** Will vote on key corporate governance matters, including director elections, auditor ratification, equity plan approval, executive compensation, and the crucial approval for warrant exercises from a private placement, which could impact share dilution and capital structure. The decrease in net loss is a positive for shareholder value, while negative TSR is a concern.
• **Employees:** The proposed Amended and Restated 2016 Equity Compensation Plan is designed to attract, motivate, and retain key employees through equity-based incentives. Executive officers experienced temporary salary reductions due to the conflict in Israel.
• **Management:** Executive compensation details are disclosed, and the Board's recommendation for biennial advisory votes on compensation provides clarity on future review cycles. Management changes include a new CFO appointment.
• **Creditors/Investors:** The $6.5 million private placement provides additional working capital, which can improve liquidity and financial stability. The need for shareholder approval for warrant exercise is a critical point for investors holding those warrants.

Next Steps

• Shareholders are invited to attend the annual meeting on June 30, 2025, to vote on the proposed matters.
• Shareholders are requested to vote by internet or telephone, or complete, sign, and return a proxy card without delay.
• The Board will consider the outcome of the non-binding advisory votes on executive compensation and its frequency when making future decisions.
• The Audit Committee will reconsider retaining Kesselman & Kesselman if shareholders fail to ratify their selection as independent auditors.

Key Dates

Recommendation

Keywords

SEC filing, Proxy Statement, Annual Meeting, Corporate Governance, Equity Compensation Plan, Private Placement, Warrants, Nasdaq Listing Rules, Executive Compensation, Financial Performance, Net Loss, Shareholder Vote, Biotechnology, Cellular Therapeutics, Israel