Blueprint
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
(Amendment No. )
Filed
by
Registrant
☑
|
|
Filed
by Party other than Registrant
☐
|
|
|
|
Check
the appropriate box:
|
|
|
|
☑
Preliminary Proxy Statement
|
☐ Confidential,
for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
|
☐
Definitive Proxy Statement
|
☐ Definitive
Additional Materials
|
☐
Soliciting Materials Pursuant to §240.14a-12
|
|
CORD BLOOD AMERICA, INC.
|
(Name
of Registrant as Specified In Its Charter)
|
Payment
of Filing Fee (Check the appropriate box):
|
|
|
|
☑
|
No fee
required.
|
|
☐
|
Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
|
|
(1)
|
Title
of each class of securities to which transaction
applies:
|
(2)
|
Aggregate
number of securities to which transaction applies:
|
(3)
|
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):
$_____
per share as determined under Rule 0-11 under the Exchange
Act.
|
(4)
|
Proposed
maximum aggregate value of transaction:
|
(5)
|
Total
fee paid:
|
☐
|
Fee
paid previously with preliminary materials.
|
☐
|
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.
|
(1)
|
Amount
previously paid:
|
(2)
|
Form,
Schedule or Registration Statement No.:
|
(3)
|
Filing
Party:
|
(4)
|
Date
Filed:
|
CORD BLOOD AMERICA, INC.
_____________
NOTICE OF 2017 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JULY 19, 2017
______________
To our shareholders:
NOTICE
IS HEREBY GIVEN that the 2017 Annual Meeting of Shareholders of
Cord Blood America, Inc., a Florida corporation (the
“Company”), will be held on Wednesday, July 19, 2017,
at 10:00 a.m., Eastern time, at
_______________________________________, for the following
purposes:
1.
To elect one
director nominated by the board of directors named in the attached
proxy statement to serve until the 2020 annual meeting of
shareholders;
2.
To ratify the
appointment of RBSM LLP as the Company’s independent
registered certified public accounting firm for the fiscal year
ending December 31, 2017;
3.
To consider and act
upon a proposal to approve an amendment to the Amended and Restated
Articles of Incorporation; and
4.
To transact such
other business as may properly come before the annual meeting,
including any adjournment thereof.
The Company’s board of directors has fixed May 22, 2017, at
the close of business, as the record date for the determination of
shareholders entitled to notice of and to vote at the annual
meeting and at any adjournment or adjournments of the
meeting.
All
shareholders are invited to attend the annual meeting in person.
Your vote is important regardless of the number of shares you own.
Please vote your shares by proxy over the Internet by following the
instructions provided in the Notice of Internet Availability of
Proxy Materials, or, if you request printed copies of the proxy
materials by mail, you can also vote by mail, by telephone or by
facsimile.
|
|
By Order of the
Board of Directors |
|
|
|
|
|
|
|
/s/ David Sandberg |
|
Las Vegas,
Nevada
|
|
David
Sandberg
|
|
May __,
2017 |
|
Chairman
|
|
Important Notice Regarding the
Availability of Proxy Materials for the Annual Meeting to be Held
on July 19, 2017: This proxy statement, along with our
Annual Report on Form 10-K for the year ended December 31, 2016,
are available free of charge at
www.iproxydirect.com/cbai.
CORD BLOOD AMERICA, INC.
PROXY STATEMENT 2017 ANNUAL MEETING
TABLE OF CONTENTS
|
|
Information Concerning Solicitation and
Voting
|
1
|
Principal Shareholders
|
3
|
Compliance
with Section 16(a) of the Exchange Act
|
4
|
Corporate Governance and Board of Directors
Matters
|
4
|
Role
of the Board of Directors’ Committees
|
5
|
Audit
Committee Report
|
6
|
Board
Diversity
|
7
|
Selection
of Nominees for the Board of Directors
|
7
|
Board
Leadership
|
7
|
Risk
Oversight
|
7
|
Determinations
of Director Independence
|
8
|
Board
of Directors Meetings during Fiscal 2016
|
8
|
Policy
Regarding Attendance at Annual Meeting of Shareholders
|
8
|
Communication
with the Board of Directors
|
8
|
Code
of Business Conduct and Ethics and Senior Code
|
8
|
Certain
Relationships and Related Transactions
|
8
|
Executive
Compensation
|
9
|
2016
Grants of Plan-Based Awards
|
12
|
Proposal 1 Election of Directors
|
12
|
Proposal 2 Ratification of Appointment of Independent Registered
Certified Public Accounting Firm
|
12
|
Proposal 3 Approval of an Amendment to the Company’s Amended
and Restated Articles of Incorporation
|
13
|
APPENDIX
A Articles of Amendment to Amended and Restated Articles
of Incorporation of Cord Blood American, Inc. |
|
FORWARD-LOOKING STATEMENTS
This proxy statement contains “forward-looking
statements.” These statements are based on our current
expectations and involve risks and uncertainties which may cause
results to differ materially from those set forth in the
statements. The forward-looking statements may include statements
regarding actions to be taken in the future. We undertake no
obligation to publicly update any forward-looking statement,
whether as a result of new information, future events or otherwise.
Forward-looking statements should be evaluated together with the
many uncertainties that affect our business, particularly those set
forth in the section on forward-looking statements and in the risk
factors in Item 1.A of our Annual Report on Form 10-K for the
fiscal year ended December 31, 2016 as filed with the Securities
and Exchange Commission (the "Commission") on March 28, 2017 (the
“2016
10-K”).
IMPORTANT: WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING,
PLEASE COMPLETE, SIGN, DATE AND RETURN THE ACCOMPANYING PROXY CARD
OR VOTING INSTRUCTION CARD OR VOTE ELECTRONICALLY VIA THE INTERNET
OR BY TELEPHONE.
CORD BLOOD AMERICA, INC.
____________
PROXY STATEMENT
FOR ANNUAL MEETING OF SHAREHOLDERS
JULY 19, 2017
____________
Information Concerning Solicitation and Voting
The
accompanying proxy is solicited by the board of directors of Cord
Blood America, Inc. for use at our 2017 annual meeting of
shareholders to be held on Wednesday, July 19, 2017, or any
adjournment or postponement thereof, for the purposes set forth in
the accompanying Notice of 2017 Annual Meeting of Shareholders. The
date of this proxy statement is May __, 2017, the approximate date
on which this proxy statement and the enclosed proxy were first
sent or made available to our shareholders.
This
proxy statement and the accompanying proxy card are being mailed to
owners of our common shares in connection with the solicitation of
proxies by the board of directors for the 2017 annual meeting of
shareholders. This proxy procedure is necessary to permit all
common shareholders, many of whom live throughout the United States
and are unable to attend the 2017 annual meeting in person, to
vote. We will pay the entire cost of preparing, assembling,
printing, mailing and distributing these proxy materials and
soliciting votes.
Electronic access.
To access our proxy statement and 2016 10-K electronically, please
visit our corporate website at www.iproxydirect.com/cbai.
Voting securities.
Only our shareholders of record as of the close of business on May
22, 2017, the record date for the 2017 annual meeting, will be
entitled to vote at the meeting and any adjournment thereof. As of
that date, there were 1,272,066,146 shares of our common stock issued
and outstanding, all of which are entitled to vote with respect to
all matters to be acted upon at the 2017 annual meeting. Each
holder of record as of that date is entitled to one vote for each
share held. In accordance with our by-laws, the presence of at
least a majority of the voting power, regardless of whether the
proxy has authority to vote on all matters, constitutes a quorum
which is required in order to hold 2017 annual meeting and conduct
business. Presence may be in person or by proxy. You will be
considered part of the quorum if you voted on the Internet, by
telephone, by facsimile or by properly submitting a proxy card or
voting instruction form by mail, or if you are present and vote at
the 2017 annual meeting. Votes for and against, abstentions and
“broker non-votes” will each be counted as present for
purposes of determining the presence of a quorum.
Broker non-votes. If
you are a beneficial owner whose shares are held of record by a
broker, bank or other nominee, you must instruct the broker, bank
or other nominee how to vote your shares. If you do not provide
voting instructions, your shares will not be voted on any proposal
on which the broker, bank or other nominee does not have
discretionary authority to vote. This is called a “broker
non-vote.” In these cases, the broker, bank or other nominee
can register your shares as being present at the 2017 annual
meeting for purposes of determining the presence of a quorum, but
will not be able to vote on those matters for which specific
authorization is required. Your broker, bank or other nominee does
not have discretionary authority to vote on the election of the
directors (proposal 1) or for proposal 3 without instructions from
you, in which case a broker non-vote will occur and your shares
will not be voted on these matters. Your broker, bank or other
nominee does have discretionary voting authority to vote your
shares on the ratification of the independent registered public
accounting firm (proposal 2), even if the broker, bank or other
nominee does not receive voting instructions from you. In any event, it is particularly important that
you instruct your broker as to how you wish to vote your
shares.
Voting of proxies.
All valid proxies received prior to the meeting will be exercised.
All shares represented by a proxy will be voted, and where a proxy
specifies a shareholder’s choice with respect to any matter
to be acted upon, the shares will be voted in accordance with that
specification. If no choice is indicated on the proxy, the shares
will be voted by the individuals named on the proxy card as
recommended by the board of directors. A shareholder giving a proxy
has the power to revoke his or her proxy, at any time prior to the
time it is exercised, by delivering to our corporate secretary a
written instrument revoking the proxy or a duly executed proxy with
a later date, or by attending the meeting and voting in person. A
shareholder wanting to vote in person at the 2017 annual meeting
and holding shares of our common stock in street name must obtain a
proxy card from his or her broker and bring that proxy card to the
2017 annual meeting, together with a copy of a brokerage statement
reflecting such share ownership as of the record date.
Vote required. The one nominee receiving the greatest
numbers of votes at the meeting, assuming a quorum is present, will
be elected as a director to serve until the 2020 annual meeting of
shareholders. Because directors are elected by plurality,
abstentions from voting and broker non-votes will be entirely
excluded from the vote and will have no effect on its outcome.
Assuming a quorum is present, proposal 2 must be approved by the
affirmative vote of a majority of the shares of common stock
present in person or by proxy at the annual meeting and entitled to
vote. Proposals 3 requires an
affirmative vote of the shareholders of not less than two-thirds of
the voting power of all of the shares entitled to vote for the
election of directors. Abstentions will be counted in
tabulations of the votes cast on each such proposal and will have
the same effect as a vote against the proposal, whereas broker
non-votes will be excluded from the vote and will have no effect on
the outcome.
Board of directors recommendations. The board of directors recommends a
vote FOR proposals 1, 2 and 3.
Attendance at the meeting. You are invited to attend the
annual meeting only if you were a Cord Blood America shareholder or
joint holder as of the close of business on May 22, 2017, the
record date, or if you hold a valid proxy for the 2017 annual
meeting. In addition, if you are a shareholder of record (owning
shares in your own name), your name will be verified against the
list of registered shareholders on the record date prior to your
being admitted to the annual meeting. If you are not a shareholder
of record but hold shares through a broker or nominee (in street
name), you should provide proof of beneficial ownership on the
record date, such as a recent account statement or a copy of the
voting instruction card provided by your broker or nominee. The
meeting will begin at ____ _.m. local time. Check-in will begin at
____ _.m. local time.
Communications with our board of directors. You may contact
any of our directors by writing to them c/o Cord Blood America,
Inc., 1857 Helm Drive, Las Vegas, NV 89119. Each communication
should specify the applicable director or directors to be contacted
as well as the general topic of the communication. We may initially
receive and process communications before forwarding them to the
applicable director. We generally will not forward to the directors
a shareholder communication that is determined to be primarily
commercial in nature, that relates to an improper or irrelevant
topic, or that requests general information about Cord Blood
America. Concerns about accounting or auditing matters or
communications intended for non-management directors should be sent
to the attention of the Chairman of the Audit Committee at the
address above. Our directors may at any time review a log of all
correspondence received by Cord Blood America that is addressed to
the independent members of the board and request copies of any such
correspondence.
Who can help answer your questions? If you have additional
questions after reading this proxy statement, you may seek answers
to your questions by writing, calling or emailing:
Stephen
Morgan
General
Counsel
Cord
Blood America, Inc.
1857
Helm Drive
Las
Vegas, NV 89119
Telephone:
(702) 914-7250
email:
smorgan@cordblood-america.com
Principal Shareholders
The following table sets forth information as of May 22, 2017,
except as otherwise noted, with respect to the beneficial ownership
of our common stock:
|
•
|
each
person who is known by us to be the beneficial owner of more than
5% of our outstanding common stock;
|
|
•
|
each
director and nominee;
|
|
•
|
each
named executive officer; and
|
|
•
|
all
named executive officers and directors as a group.
|
Except
as noted below, the address for the above identified officers and
directors of the Company is c/o Cord Blood America, Inc., 1857 Helm
Drive, Las Vegas, NV 89119. Beneficial ownership is determined in
accordance with the rules of the Commission and generally includes
voting or investment power with respect to securities. Shares of
common stock subject to options, warrants or convertible debt
currently exercisable or convertible, or exercisable or convertible
within 60 days of May 22, 2017 are deemed outstanding for computing
the percentage of the person holding such option or warrant.
Percentages are based on a total of 1,272,066,146 shares of common
stock outstanding on May 22, 2017 and shares issuable upon exercise
of options, warrants exercisable, and debt convertible on or within
60 days of May 22, 2017 as described above. The inclusion in the
aforementioned table of those shares, however, does not constitute
an admission that the named shareholder is a direct or indirect
beneficial owner of those shares. Unless otherwise indicated, to
our knowledge, based upon information produced by the persons and
entities named in the table, each person or entity named in the
table has sole voting power and investment power of shares voting
and/or investment power with his or her spouse, with respect to all
shares of capital stock listed as owned by that person or
entity.
Name
And Address Of Beneficial Owner
|
Amount And
Nature
Of
Beneficial
Ownership
|
Approximate
Percent
of
Class
(%)
|
Cryo-Cell
International, Inc. (1)
700 Brooker Creek
Boulevard, Suite 1800
Oldsmar, Florida
34677
|
110,749,924
|
8.7%
|
|
|
|
Red Oak Partners,
LLC (2)
150 E Palmetto Park
Road, Suite 800
Boca Raton, Florida
33432
|
381,052,632
|
30.0%
|
|
|
|
Stephen
Morgan
|
100,000
|
*%
|
Timothy G.
McGrath
|
90,669
|
*%
|
David Sandberg
(2)
|
381,052,632
|
30.0%
|
Anthony
Snow
|
0
|
*%
|
Adrian
Pertierra
|
0
|
*%
|
All above executive
officers and directors as a group (five persons)(2)
|
381,243,301
|
30.1%
|
———————
*
|
Less
than 1% of the outstanding common stock.
|
(1)
|
The
amount shown and the following information is derived from an
Amendment No. 2 to Schedule 13D filed by Cryo-Cell International,
Inc., reporting beneficial ownership as of April 11,
2016.
|
(2)
|
Red Oak
Partners, LLC has shared voting power and shared dispositive power
over the 381,052,632 shares. Red Oak Partners, LLC is affiliated
with the following entities and individual that hold voting power
and dispositive power over certain shares: (i) The Red Oak Fund,
LP; (ii) the Red Oak Long Fund, LP; (iii) Pinnacle Opportunities
Fund, LP; (iv) Pinnacle Capital Partners, LLC; and (v) David
Sandberg. Each of them disclaims beneficial ownership with respect
to any shares other than shares owned directly by
them.
|
Compliance with Section 16(a) of the Exchange Act
Section
16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") requires that our executive officers and directors,
and persons who own more than 10% of a registered class of our
equity securities, file reports of ownership and changes in
ownership with the Commission. Officers, directors and persons
owning more than 10% of such securities required by Commission
regulations to file with the Commission and furnish the Company
with copies of all reports required under Section 16(a) of the
Exchange Act. To the Company’s knowledge, based solely upon
our review of the copies of such reports furnished to us, during
the fiscal year ended December 31, 2016, all Section 16(a)
filing requirements applicable to its executive officers, directors
and 10% or greater shareholders were complied with.
Corporate Governance and Board of Directors Matters
The
following table sets forth the names and positions of the
Company’s executive officers and directors.
Name
|
|
Age
|
|
Position with
the Company
|
Director Term
Expiring
|
|
|
|
|
|
|
Stephen
Morgan
|
|
40
|
|
Interim
President, General Counsel, and Secretary
|
-
|
Timothy
McGrath
|
|
53
|
|
Director
|
2017
annual meeting
|
David
Sandberg
|
|
45
|
|
Chairman
of the Board of Directors
|
2019
annual meeting
|
Anthony
Snow
|
|
42
|
|
Director
|
2018
annual meeting
|
Adrian
Pertierra
|
|
45
|
|
Director
|
2018
annual meeting
|
Stephen Morgan currently serves as Interim President,
General Counsel, and Corporate Secretary. He has been General
Counsel of the Company since August 2010. Prior to his employment
with the Company, Mr. Morgan worked for law firms in Los Angeles,
California, representing clients in a broad range of transactional
and litigation matters. Mr. Morgan earned his Bachelor of Science
degree from the University of Minnesota and his Juris Doctor from
Loyola Law School in Los Angeles, California.
Timothy McGrath has been a director of the Company
since March 2006. Mr. McGrath has served in an executive capacity
for the past 13 years. Since September 2011, Mr. McGrath has served
as Controller for Logic Information Systems, Inc., a technology
services company. From January 2006 to February 2008 Mr. McGrath
served as the Vice President of Finance and Accounting at BioE,
Inc. From October 1999 through September 2005 Mr. McGrath served as
Vice President and Chief Financial Officer of Orphan Medical, Inc.
The Nominating and Corporate Governance Committee of our board of
directors considered Mr. McGrath's finance and accounting
professional background in selecting him as a director of the
Company.
David Sandberg has been the Chairman of the Board of the
Company since April 2015. He is the managing member and founder of
Red Oak Partners, LLC, a Florida-based, SEC-registered investment
company founded in 2003 and which manages several public and
private funds. Previously, Mr. Sandberg co-managed JH Whitney &
Co’s Green River Fund from 1998 to 2002. Mr. Sandberg
presently serves as the Chairman of the Board of Asure Software,
Inc., and as a director of SMTC Corp. Mr. Sandberg has previously
served as a director of public companies Planar Systems, Inc., RF
Industries Ltd., Issuer Direct Corp., and EDCI Holdings Inc. Mr.
Sandberg’s public board experience includes serving as the
Chairman of each of Audit, Compensation, Governance, and Strategic
committees. Mr. Sandberg received a BA in Economics and a BS in
Industrial Management from Carnegie Mellon University. The
Nominating and Corporate Governance Committee of our board of
directors considered Mr. Sandberg's financial and investment
experience as well as his service on other public company boards of
directors in selecting him as a director of the
Company.
Anthony Snow has been a director of the Company since April
2015. Since 2012, he
has served as a Managing Director at Red Oak Partners. LLC. Prior
to joining Red Oak Partners, LLC, Mr. Snow worked at Soros Fund
Management where he was part of a two person team that managed a
$250 million global long/short equity portfolio. Prior to Soros
Fund Management, Mr. Snow focused on investments in global equities
at both Ardea Capital Management, as part of the founding team, and
Wyper Capital Management. Previously, Mr. Snow was employed at
Lindsay Goldberg, a private equity firm, where he focused on
leveraged buyouts. Mr. Snow began his career at Merrill Lynch &
Co. as an Analyst in the Mergers & Acquisitions group. He
received a B.B.A. with high distinction from the University of
Michigan, concentrating in finance and accounting, and an M.B.A.
from Harvard Business School. Mr. Snow is currently a Director and
Chairman of the Finance Committee of StreetWise Partners, a New
York City non-profit, and also serves on the Executive Committee.
The Nominating and Corporate Governance Committee of our board of
directors considered Mr. Snow's financial and investment experience
in selecting him as a director of the Company.
Adrian Pertierra has been a
director of the Company since April 2015. Since 2008, he has served
as the Chief Financial Officer and Head of Trading at Red Oak
Partners, LLC, a Florida-based, SEC-registered investment company.
Prior to joining Red Oak Partners, LLC in 2007, Mr. Pertierra
worked at Tradition Asiel Securities, Inc. from 2006 to 2007,
specializing in risk arbitrage. Previously, Mr. Pertierra served as
the Vice President of Institutional Equity Sales and Trading at BGC
Partners, LP, from 2002 to 2006. Mr. Pertierra is currently the
Chairman of the Nominating and Governance committee and serves as a
Director on the Board of Asure Software, Inc., a publicly traded
company. Mr. Pertierra received a BA in Economics from the College
of Holy Cross. The Nominating and Corporate Governance Committee of
our board of directors considered Mr. Pertierra's service on other
public company boards of directors in selecting him as a director
of the Company.
Presently,
our directors are divided into three classes. Directors are elected
for a full term of three years. Our directors are elected for terms
which expires at the third succeeding annual meeting of
shareholders after their election. If any director resigns, dies or
is otherwise unable to serve out his or her term, or if the board
increases the number of directors, the board may fill any vacancy
by a vote of a majority of the directors then in office, although
less than a quorum exists. Directors may be removed from office at
any time, with or without case, by the affirmative vote of the
holders of not less than two-thirds of the voting power of all of
the shares of our company entitled to vote for the election of
directors.
Upon,
however, the approval of Proposal 3, the term of office of each
person elected as a director will continue until the next annual
meeting of shareholders and until a successor has been elected and
qualified, or until his or her earlier death, resignation or
removal.
Role of the Board of Directors’ Committees
Director
|
|
Nominating and
Governance Committee
|
|
Timothy
McGrath
|
√
|
√
|
√(1)
|
David
Sandberg
|
√
|
√
|
√
|
Anthony
Snow
|
√(1)
|
√
|
√
|
Adrian
Pertierra
|
√
|
√(1)
|
√
|
(1)
denotes committee
Chairman.
Audit Committee. The Audit
Committee provides assistance to the Board of the Company in
fulfilling its oversight responsibility to shareholders, potential
shareholders and the investment community relating to (a) the
accounting and reporting practices of the Company, (b) the
effectiveness of the Company’s internal control over
financial reporting, (c) the Company’s compliance with legal
and regulatory requirements related to financial reporting, (d) the
qualifications and independence of the Company’s independent
auditor, (e) the performance of the Company’s independent
auditor and (f) the quality and integrity of the financial reports
of the Company. Mr. McGrath, Mr. Sandberg,
Mr. Snow and Mr. Pertierra are the current members of the Audit
Committee. The Board has determined that the Company has two Audit
Committee financial experts, Mr. Snow and Mr. McGrath. In April
2017, the Board adopted its written Audit Committee charter and it
can be found on the Company’s website at
http://www.cordblood-america.com/investors/charters/. The Audit
Committee met four times during the 2016 fiscal year.
Nominating and Governance Committee.
The
Nominating and Governance Committee identifies individuals
qualified to become members of the Board, recommends director
nominees for election at the next annual meeting of shareholders,
subject to approval by the Board, develops and recommends to the
Board a set of corporate governance principles applicable to the
Company and oversees the evaluation of the Board and its dealings
with management and appropriate committees of the Board. Mr.
McGrath, Mr. Sandberg, Mr. Snow and Mr. Pertierra are the current
members of the Nominating and Governance Committee. The Nominating
and Governance Committee has a charter and it can be found on the
Company’s website at
http://www.cordblood-america.com/investors/charters/. The
Nominating and Governance Committee did not meet during the 2016
fiscal year. The Committee shall be comprised of directors such
that the Committee complies with all independence requirements
under the “NASDAQ Rules for
Determining Whether a Member of the Board of Directors is
Independent”.
Compensation Committee.
Mr.
McGrath, Mr. Sandberg, Mr. Snow and Mr. Pertierra are the current
members of the Compensation Committee. The Compensation Committee
does not have a charter. A compensation consultant has not been
hired by the Compensation Committee. The Compensation Committee met
once during the 2016 fiscal year.
The
Committee is responsible for setting the Company's compensation
principles to guide the design of its executive compensation
framework. The Committee is also responsible for determining the
annual compensation of the President and the other executive
officers.
The
Committee makes every effort to maintain its independence and
objectivity. While the Committee receives input from the President
and discusses compensation with them, the ultimate determination
regarding the annual compensation of the President and other
executive officers is in the Committee’s sole and absolute
discretion.
Audit Committee Report
The primary function of the Audit Committee is to assist the board
of directors in its oversight of our financial reporting processes.
Management is responsible for the preparation, presentation and
integrity of the financial statements, including establishing
accounting and financial reporting principles and designing systems
of internal control over financial reporting. Our independent
auditors are responsible for expressing an opinion as to the
conformity of our consolidated financial statements with generally
accepted accounting principles and auditing management’s
assessment of the effectiveness of internal control over financial
reporting.
In this
context, the Audit Committee reports as follows:
(1)
The Audit Committee
has reviewed and discussed the audited financial statements with
the Company’s management and RBSM LLP.
(2)
The Audit Committee
has discussed with RBSM LLP the matters required to be discussed
under Public Company Accounting Oversight Board Auditing Standard
16.
(3)
The Audit Committee
has received and reviewed the written disclosures and the letter
from RBSM LLP required by the applicable requirements of the Public
Company Accounting Oversight Board Rule regarding the independent
accountant’s communications with the Audit Committee
concerning independence and has discussed with RBSM LLP its
independence from the Company.
(4)
Based on the review
and discussion referred to in paragraphs (1) through (3) above, the
Audit Committee recommended to the Company’s Board, and the
Board approved, that the audited financial statements be included
in the Company’s Annual Report on Form 10-K for the fiscal
year ended December 31, 2016, for filing with the
SEC.
(5)
The Audit Committee
has appointed RBSM LLP as the Company’s independent
registered certified public accounting firm for the fiscal year
ending December 31, 2017.
Dated
May __, 2017
|
|
Audit
Committee of the Board of Directors of Cord Blood America,
Inc.
|
|
|
|
|
|
/s/ Anthony Snow
|
|
|
/s/ Timothy McGrath
|
|
|
/s/ David Sandberg
|
|
|
/s/ Adrian Pertierra
|
Board Diversity
The
Board of Directors and the Nominating
and Governance Committee consider diversity in the selection
of nominees, utilizing a broad meaning to include a nominee's
background, experience, skills, accomplishments, financial
expertise, professional interests, personal qualities and other
traits desirable in achieving an appropriate group of qualified
individuals. The Committee will
consider and assess the Board’s diversity in connection with
the annual director nomination process to assure it includes an
effective mix of people to further our long-term business
interests.
Selection of Nominees for the Board of Directors
One of
the tasks of the Nominating and Governance Committee is to identify
and recruit candidates to serve on the board of directors. The
Committee is responsible for providing a list of nominees to the
Board for nomination at each annual meeting of shareholders. This
Committee will consider nominees for board membership suggested by
its members and other Board members, as well as management and
shareholders. The Committee may at its discretion retain a
third-party executive search firm to identify potential nominees.
The Committee will take into account many factors in evaluating a
prospective nominee, including, among other things, having
integrity and being accountable, being able to exercise informed
judgment, being financially literate, having high performance
standards, and adding to the Board’s diversity of
backgrounds, experiences, skills, accomplishments, financial
expertise, professional interests, personal qualities and other
traits.
All
shareholder nominating recommendations must be in writing,
addressed to the Nominating and Governance Committee in care of the
Company’s General Counsel, Cord Blood America, Inc., 1857
Helm Drive, Las Vegas, NV, 89119. Submissions must be made by mail,
courier or personal delivery. E-mailed submissions will not be
considered. If a recommendation is submitted by a group of two or
more shareholders, the information regarding recommending
shareholders must be submitted with respect to each shareholder in
the group. Acceptance of a recommendation for consideration does
not imply that the Nominating and Governance Committee will
nominate the recommended candidate. In addition to proposing
nominees for consideration to the Nominating and Governance
Committee, shareholders may also directly propose nominees for
consideration at an annual meeting of shareholders.
Board Leadership
The
board of directors does not currently have a policy on whether the
same person should serve as both the Chief Executive Officer and
Chairman of the Board or, if the roles are separate, whether the
Chairman should be selected from the non-employee directors or
should be an employee. The Board believes that it should have the
flexibility to make these determinations at any given point in time
in the way that it believes best to provide appropriate leadership
for the Company at that time. Our current Chairman, David Sandberg,
is not an officer. Mr. Sandberg has served as our Chairman since
April 2015.
Risk Oversight
Risk is
inherent in every business. As is the case in virtually all
businesses, the Company faces a number of risks, including
operational, economic, financial, legal, regulatory, and
competitive risks. The Company's management is responsible for the
day-to-day management of the risks we face. The Board, as a whole
and through its committees, has responsibility for the oversight of
risk management.
In its
oversight role, the Board's involvement in the Company's business
strategy and strategic plans plays a key role in its oversight of
risk management, its assessment of management’s risk
appetite, and its determination of the appropriate level of
enterprise risk. The Board receives updates periodically from
senior management and outside advisors regarding the various risks
the Company faces, including operational, economic, financial,
legal, regulatory, and competitive risks. The Board also reviews
various risks relating to various specific developments, such as
acquisitions, stock repurchases, debt and equity placements, and
product introductions.
The
Board committees assist the Board in fulfilling its oversight role
in certain areas of risks. The Audit Committee oversees the
financial and reporting processes of the Company and the audit of
the financial statements of our company and provides assistance to
our Board of Directors with respect to the oversight and integrity
of the financial statements of the Company, its compliance with
legal and regulatory matters, the independent auditor’s
qualification and independence, and the performance of our
independent auditor. The Compensation Committee considers the risks
that the Company's compensation policies and practices may have in
attracting, retaining, and motivating valued employees and
endeavors to assure that it is not reasonably likely that the
Company's compensation plans and policies would have a material
adverse effect on our company. Our Nominating and Governance
Committee oversees governance related risks, such as board
independence, conflicts of interests, and management succession
planning.
Determinations of Director Independence
Mr.
McGrath, Mr. Sandberg, Mr. Snow and Mr. Pertierra are independent
as that term is defined under the NASDAQ Marketplace
Rules.
Board of Directors Meetings during Fiscal 2016
The
board of directors held one meeting and took action by unanimous
consent four times during 2016. All individuals who were directors
in 2016 attended 75% or more of the aggregate number of Board and
committee meetings on which he served. The Chairman of the Board
presides over all meetings of the Board.
Policy Regarding Attendance at Annual Meeting of
Shareholders
All
directors are invited to attend the annual meeting of
shareholders.
Communication with the Board of Directors
Shareholders
may communicate with the full Board or individual directors by
submitting such communications in writing to Cord Blood America,
Inc., 1857 Helm Drive, Las Vegas, NV, 89119, Attention: General
Counsel. Such communications will be delivered directly to the
Company’s Board.
Code of Business Conduct and Ethics and Senior Code
The
Company adopted a Code of Ethics on April 13, 2005 that applies to
all of its directors, officers and employees, including principal
executive officer, principal financial officer and principal
accounting officer. The Code of Ethics was attached as Exhibit 14.1
to our registration statement filed on Form SB-2 on May 2,
2005.
Certain Relationships and Related Transactions
In
March of 2010 the Company acquired pursuant to a License Agreement,
a 10% non dilutable interest in what became, in December 2010,
China Stem Cells, Ltd., a Cayman Islands company (hereinafter
"Cayman"), which indirectly holds a 100% capital interest in AXM
Shenyang, a company organized to conduct a stem cell storage
business in China. In exchange for issuance of an equity interest
in Cayman, under the terms of the Transfer of Technology Agreement
the Company agreed to provide technology transfer, knowhow and
training in the setup, marketing and operation of the China stem
cell storage business. In connection with the License Agreement,
the Company is to receive royalties equal to 8.5% of "Net Revenues"
realized from the China stem cell storage business, over the 15
year term of the agreement, with certain minimum annual
royalties’ payable beginning in 2011. The Company has not
been paid any royalty balance due to date, and it remains
doubtful that any such royalties will be collected.
In
December of 2010 the Company also acquired the option to provide up
to $750,000 of additional capital funding to Cayman through the
purchase of Cayman secured convertible promissory notes and
attached Cayman warrants to acquire its common stock. Other Cayman
shareholders were granted similar options, with the intent of
raising the aggregate up to $1.5 million in additional capital for
Cayman and its subsidiaries. The Company has exercised this option
in part, provided a total of $400,000 in additional capital to
Cayman, and is to receive Cayman secured convertible promissory
notes for this sum along with 80 Cayman (TBD) warrants. The secured
convertible promissory notes are convertible into Cayman stock at a
conversion price of $1,500 per share, subject to certain
adjustments. The warrants have a five year term and are exercisable
at an option exercise price of $0.05 per share per share, subject
to certain adjustments. The Company has recorded a reserve for the
entire carrying amount of the receivable, including interest.
The Company’s former President, Joseph Vicente was appointed
as a Director of Cayman in July 2012.
Compensation of Directors
In April 17, 2015, the Board established compensation for
non-management directors of $5,000 per year, plus $1,000 per year
for the Chairman of the Nominating and Governance Committee, $2,000
per year for the Chairman of the Compensation Committee, $3,000 per
year for the Chairman of the Audit Committee and $4,000 per year
for the Chairman of the Board. The following table sets
forth with respect to the named director, compensation information
inclusive of equity awards and payments made in the year ended
December 31, 2016.
Name
|
Fees
Earned
or Paid
in
Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($)
|
Non-Equity
Incentive
Plan
Compensation
($)
|
Nonqualified
Deferred
Compensation
Earnings
($)
|
All
Other
Compensation
($)
|
Total
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
|
|
|
|
|
|
|
|
Joseph
R. Vicente (1)
|
$0
|
$0
|
0
|
0
|
0
|
0
|
$0
|
Timothy
McGrath
|
$7,000
|
$0
|
0
|
0
|
0
|
0
|
$7,000
|
David
Sandberg
|
$9,000
|
$0
|
0
|
0
|
0
|
0
|
$9,000
|
Anthony
Snow
|
$8,000
|
$0
|
0
|
0
|
0
|
0
|
$8,000
|
Adrian
Pertierra
|
$6,000
|
$0
|
0
|
0
|
0
|
0
|
$6,000
|
(1)
Mr. Vicente served
as a member of the board of directors from May 2012 until February
2016.
Executive Compensation
Compensation Program Objectives and Philosophy
The primary goals of the Company policy of executive compensation
are to attract and retain the most talented and dedicated
executives possible, to assure that its executives are compensated
effectively in a manner consistent with Company strategy and
competitive practice, and to align executive’s compensation
with the achievement of the Company’s short and long term
business objectives.
The board of directors considers a variety of factors in
determining compensation of executives, including their particular
background and circumstances, such as their training and prior
relevant work experience, their success in attracting and retaining
savvy and technically proficient managers and employees, increasing
its revenues, broadening the Company product line offerings,
managing costs and otherwise helping to lead the Company through a
period of profitable growth.
The Company’s board of directors has formed a compensation
committee charged with the oversight of executive compensation
plans, policies and programs of the Company and with the full
authority to determine and approve the compensation of the
Company’s Interim President and also makes recommendations
with respect to the compensation of other executive
officers.
Elements of Compensation
The Company’s compensation program for the named executive
officers consists primarily of base salary. There is no retirement
plan, long-term incentive plan or other such plans, although Mr.
Morgan’s agreement has a bonus plan. The base salary provided
is intended to equitably compensate the named executive officers
based upon their level of responsibility, complexity and importance
of role, leadership and growth potential, and
experience.
Base Salary
The Company’s named executive officers receive base salaries
commensurate with their roles and responsibilities, while
considering the financial condition of the Company. Base salaries
and subsequent adjustments, if any, are to be reviewed and approved
by the Company’s board of directors, with the advice of the
Compensation Committee, annually, based on an informal review of
relevant market data and each executive’s performance for the
prior year, as well as each executive’s experience, expertise
and position. The base salaries paid to the Company’s named
executive officers in 2016 are reflected in the Summary
Compensation Table below.
Stock-Based Awards under the Equity Incentive Plan
The Company previously provided equity awards as a component of
compensation. No such awards were provided in 2016.
Perquisites
The Company did not provide its named executive officers with any
perquisites and other personal benefits. The Company does not view
perquisites as a significant element of its compensation structure,
but does believe that perquisites can be useful in attracting,
motivating and retaining the executive talent for which it
competes. It is expected that the current practice regarding
perquisites will continue and will be subject to periodic review by
its Compensation Committee and board of directors.
The following table sets forth the compensation paid to the
Company’s President (former) and Interim President for each
of its last two completed fiscal years. No other officer received
compensation greater than $100,000 for either fiscal
year.
Summary Compensation Table
Name and
Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Option
Awards
($)
|
All
Other
Compensation ($)
|
Total
($)
|
|
|
|
|
|
|
|
Joseph
Vicente
|
2016
|
16,875
|
11,407
|
0
|
0
|
28,282
|
President
and Principal Financial and Accounting Officer (former)
(1)
|
2015
|
133,000
|
28,350
|
0
|
0
|
161,350
|
|
|
|
|
|
|
Stephen
Morgan
|
2016
|
132,875
|
7,500
|
0
|
0
|
140,375
|
Interim
President, Corporate Secretary, and General Counsel
|
2015
|
127,550
|
11,375
|
0
|
0
|
138,925
|
(1)
Mr. Vincente served
as our President until February 2016.
Employment Agreements
Employment Agreements with Mr. Morgan
On March 31, 2015, the Company entered into an Executive Employment
Agreement with Stephen Morgan, the Company’s Vice President,
General Counsel and Corporate Secretary, which was effective as of
April 1, 2015 and terminated as of March 31, 2017, unless earlier
terminated by the Company or Mr. Morgan in accordance with the
agreement (the “Morgan Employment Agreement”). The
Morgan Employment Agreement provides for a base salary equal to
$130,000, as well as an annual bonus opportunity, payable at the
discretion of the board of directors, equal to 25% of Mr.
Morgan’s base salary for that calendar year, provided that
Mr. Morgan had the option to receive any portion of his salary and
bonus in stock of the Company, in lieu of cash, at a value
determined by the board of directors in their reasonable discretion
and otherwise in accordance with the Employment
Agreement.
Effective April 9, 2015, the Company entered into an Amendment to
Executive Employment Agreement with Mr. Morgan amending his
employment agreement, such that Mr. Morgan no longer has the
option, in his sole discretion, to receive his salary and bonus
amounts in the form of Company stock, rather than
cash.
Effective February 12, 2016, the Company entered into a Second
Amendment to Executive Employment Agreement with Mr. Morgan (the
“Second Amendment”), amending his original, April 1,
2015 employment agreement. Concurrent with the Second Amendment,
Mr. Morgan commenced serving as Interim President of the Company.
Mr. Morgan no longer serves as Vice President of the Company, but
remains in his positions as Corporate Secretary and General
Counsel. The Second Amendment reflects a $5,000 increase in Mr.
Morgan’s annual salary during the period Mr. Morgan serves as
Interim President, which period commenced on February 12, 2016 and
shall end at any time on three (3) days’ notice by the
Company (the “Interim Term”). The Second Amendment
further provides that the increase in Mr. Morgan’s salary
shall not be included in any severance calculations, including the
severance calculations set forth in Sections 5(e) and 5(f) of his
original agreement, and that upon termination of the Interim Term
for any reason, Mr. Morgan’s employment, duties and salary
shall revert back to what they were prior to the Second
Amendment.
Finally,
effective March 31, 2017, the Company entered
into a Third Amendment to Executive Employment Agreement (the
“Third Amendment”) with Mr. Morgan. The Third Amendment
provides that the last day of
the term of Mr. Morgan's employment is extended from March 31,
2017, to March 31, 2018, subject to the other terms and conditions
of Section 2 of the original agreement; provided,
however, that (i) the Company
may change Mr. Morgan's status from full-time to part-time employee
at any time, (ii) concurrently with any such change in status, the
Company may modify his base compensation amount and structure, and
his prospective bonus, if any, and (iii) notwithstanding any such
change in status, Mr. Morgan shall remain eligible to receive the
amount and other benefits set forth in Section 5(f) in accordance
with the terms and conditions thereof.
Vicente Agreements
On
December 18, 2014, the Company entered into an Executive Employment
Agreement with Joseph R. Vicente, the Company’s former
President and Chairman of the Board, which was effective as of
January 1, 2015 and was to terminate as of December 31, 2017,
unless earlier terminated by the Company or Mr. Vicente in
accordance with the agreement (the “Vicente Employment
Agreement”). The Vicente Employment Agreement provided for a
base salary equal to
$135,000, as well as an annual bonus opportunity, payable at the
discretion of the board of directors, equal to 30% of Mr.
Vicente’s base salary for that calendar year. Mr. Vicente had
the option to receive any portion of his salary and bonus in stock
of the Company, which was amended effective April 9, 2015 pursuant
to an
Amendment to Executive Employment Agreement whereby Mr. Vicente no
longer had the option in his sole discretion to receive his salary
and bonus amounts in stock. The Vicente Employment Agreement
includes two-year restrictions on competition and solicitation of
customers following termination of the agreement.
Effective February 12, 2016 (the “Separation Date”),
the Company entered a Mutual Separation Agreement with Mr. Vicente
(the “Separation Agreement”). Pursuant to the
Separation Agreement, Mr. Vicente stepped down from his positions
as President and as a member of the Board. Under the Separation
Agreement, Mr. Vicente is entitled to receive a severance, payable
in equal monthly installments over the 24 month period post
separation, in an amount equal to all compensation paid by the
Company to Mr. Vicente for the 24 months preceding the termination,
including salary and bonus received by Mr. Vicente. In 2016, the
Company paid Mr. Vicente $118,937 in connection with the
severance, and the remaining amount payable as of December 31, 2016
is $166,511. Additionally, the Company
will pay for the value of his health insurance premiums, in monthly
installments, until the earlier of 24 months after the Separation
Date or until Mr. Vicente or his dependents become eligible for
group health insurance coverage through a new employer. In 2016,
the Company paid Mr. Vicente $16,496 in connection with these
payments, and as of December 31, 2016 has a remaining amount
payable of $20,849. Mr. Vicente is also entitled to payment of his
salary through the Separation Date, payment for unused vacation
days, payment for any unreimbursed expenses, and a bonus payment
for work performed in calendar year 2015, payable within 60 days of
the Company completing its fiscal 2015 audit. Mr. Vicente remains
subject to the restrictive covenants contained in the Vicente
Employment Agreement, including a covenant not to compete and a
non-solicitation provision, and is subject to additional
restrictive covenants in the Separation
Agreement.
Outstanding Equity Awards at Fiscal Year End.
The
following table sets forth information with respect to the
outstanding equity awards of the Company’s principal
executive officers during 2016, and each person who served as an
executive officer of our company as of December 31, 2016 (No
grants were made during 2016):
2016 Grants of Plan-Based Awards
Name
|
Grant
Date
|
All
Other
Option
Awards
(# of
Cord
Shares)
|
Exercise Price
of
Option
Awards
($/Share)
|
Grant
Date
Fair Value
of
Option
Awards
($)
|
|
|
|
|
|
Joseph
Vicente
|
|
|
|
|
Chairman
and President (former)
|
-
|
-
|
$ -
|
$ -
|
|
|
|
|
|
Stephen
Morgan
|
|
|
|
|
Interim
President and General Counsel
|
-
|
-
|
$ -
|
$ -
|
Proposal 1
Election of
Directors
The
Board, upon recommendation by the Nominating and Corporate
Governance Committee, has nominated Mr. Timothy McGrath for
re-election as a director, to hold office until the 2020 annual
meeting of shareholders or until his successor has been duly
elected and qualified. In the event Mr. McGrath is unable or
unwilling to serve as a director, the individual named as proxy on
the proxy card will vote the shares that he represents for election
of such other person as the board of directors may recommend. The
board has no reason to believe that Mr. McGrath will be unable or
unwilling to serve. Biographical information for Mr. McGrath
appears earlier in this proxy statement.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
“FOR” THE REELECTION OF MR. MCGRATH TO THE BOARD OF
DIRECTORS.
Proposal 2
Ratification
of Appointment of Independent Registered Certified
Public Accounting
Firm
The
Audit Committee has appointed RBSM LLP as our independent
registered public accounting firm to audit our consolidated
financial statements for the fiscal year ending December 31, 2017.
Representatives of RBSM LLP will be present at the 2017 annual
meeting and will have an opportunity to make a statement or to
respond to appropriate questions from shareholders. Although shareholder ratification
of the appointment of our independent auditor is not required by
our bylaws or otherwise, we are submitting the selection of RBSM
LLP to our shareholders for ratification to permit shareholders to
participate in this important corporate decision. If not ratified,
the Audit Committee will reconsider the selection, although the
Audit Committee will not be required to select a different
independent auditor for our company. Even if the appointment is
ratified, the Audit Committee, in its discretion, may direct the
appointment of a different independent registered public accounting
firm at any time during the year if the Audit Committee determines
that such a change would be in our best interests.
Principal Accounting Fees and Services
The
following table sets forth the fees billed by our principal
independent accountants, RBSM, LLP and De Joya Griffith, LLC
(“De Joya”), for each of our last two fiscal years for
the categories of services indicated:
|
|
|
|
|
|
|
Audit
Fees
|
$25,970
|
$57,276
|
$108,248
|
Audit Related
Fees
|
-
|
-
|
-
|
Tax
Fees
|
-
|
16,000
|
16,000
|
All Other
Fees
|
-
|
-
|
-
|
|
$25,970
|
$73,276
|
$124,248
|
Audit fees. Consists of fees billed for the audit of the
Company’s annual financial statements, review of our Form
10-K, review of the Company’s interim financial statements
included in the Company’s Form 10-Q and services that are
normally provided by the accountant in connection with year-end
statutory and regulatory filings or engagements.
Audit-related fees. Consists of fees billed
for assurance and related services that are reasonably related
to the performance of the audit or review of our financial
statements and are not reported under “Audit Fees”,
review of our Forms 8-K filings and services that are normally
provided by the accountant in connection with non-year-end
statutory and regulatory filings or engagements.
Tax fees. Consists of professional services rendered by a
company aligned with the Company’s principal accountant for
tax compliance, tax advice and tax planning.
Other fees. The services provided by the Company’s
accountants within this category consisted of advice and other
services relating to SEC matters, registration statement review,
accounting issues and client conferences.
The
Audit Committee pre-approves all audit and non-audit services
performed by the Company’s auditors and the fees to be paid
in connection with such services in order to assure that the
provision of such services does not impair the auditor’s
independence.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
“FOR” THIS PROPOSAL.
Proposal 3
Approval of an
Amendment to the Company’s Amended and Restated Articles of
Incorporation
The
Company’s Amended and Restated Articles of Incorporation, as
amended, provides for a classified board of directors and requires
any amendments to Article III (Board of Directors), Article IV
(Indemnification) and Articles V (Amendment) must be approved by
the affirmative vote of the holders of not less than two-thirds of
the voting power of all of the shares of our stock entitled to vote
for the election of directors. The board of directors reviews the
Company’s corporate governance practices on a continuing
basis. In light of
evolving practices and shareholder input, by resolution of the
Board on April 28, 2017, the Board determined that it is in the
best interests of the Company and our shareholders to amend our
Amended and Restated Articles of Incorporation to declassify the
Board and provide for an annual election of all directors beginning
at the 2018 annual meeting of shareholders and to change the
supermajority shareholder vote requirement for amendments to the
aforedescribed Articles to a majority vote requirement (the
"Amendment"). The board of directors believes that the declassified
Board and the majority voting requirement will give shareholders
enhanced flexibility to change the Company’s board of
directors and governing documents, while ensuring that fundamental
changes made by shareholders will be acceptable to the holders of a
majority of shares. The form of Amendment is attached to this proxy
statement as Appendix A.
The
proposed Amendment may, if adopted, make it easier for one or more
shareholders to change the Company’s corporate governance
and, therefore, make it more difficult for the board of directors
to protect shareholders’ interests, e.g., if they are
presented with an acquisition proposal that potentially undervalues
the Company. Nevertheless, there are other actions that the board
of directors can take to protect shareholders’ interests on
such occasions.
The
board of directors is proposing these amendments for the reasons
described above. The board of directors recommends that the
shareholders approve the Amendment. If this proposal is approved,
beginning with the 2018 annual meeting of shareholders, the board
of directors will be declassified and the entire Board will be
elected on an annual basis. The Board does not otherwise have any
current plans to amend any provisions of the Amended and Restated
Articles of Incorporation described above that currently require a
supermajority vote, or to take or propose any action contemplated
by such provisions, except for those proposed in this
proxy.
If the
Amendment is approved, the Board intends to cause the Amendment to
be filed with the Secretary of State of the State of Florida
following the annual meeting. If the Amendment is not approved, our
Board will remain classified and any amendment to Articles III, IV
and/or V of our Amended and Restated Articles of Incorporation will
require the affirmative vote of the holders of not less than
two-thirds of the voting power of all of our shares entitled to
vote for the election of directors.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
“FOR” THIS PROPOSAL.
OTHER MATTERS
As of
the date hereof, there are no other matters that we intend to
present, or have reason to believe others will present, at the 2017
annual meeting. If, however, other matters properly come before the
2017 annual meeting, the accompanying proxy authorizes the person
named as proxy or his substitute to vote on such matters as he
determines appropriate.
DISSENTER'S RIGHTS
Under
Florida law there are no dissenter's rights available to our
shareholders in connection with any matter submitted to a vote of
our shareholders at the 2017 annual meeting.
SHAREHOLDER PROPOSALS TO BE PRESENTED AT THE NEXT ANNUAL
MEETING
As of
the date of this proxy statement, we had not received notice of any
shareholder proposals for the 2017 annual meeting described herein
and proposals received subsequent to the date of this proxy
statement will be considered untimely. For a shareholder proposal
to be considered for inclusion in our proxy statement for the 2018
annual meeting, the corporate secretary must receive the written
proposal at our principal executive offices no later than the
deadline stated below. Such proposals must comply with SEC
regulations under Rule 14a-8 regarding the inclusion of shareholder
proposals in company-sponsored proxy materials. Proposals should be
addressed to:
Cord
Blood America, Inc.
Attention:
Corporate Secretary
1857
Helm Drive
Las
Vegas, NV 89119
Facsimile:
(702) 914-7251
Under
Rule 14a-8, to be timely, a shareholder’s notice must be
received at our principal executive offices not less than 120
calendar days before the date of our proxy statement release to
shareholders in connection with the previous year’s annual
meeting. However, if we did not hold an annual meeting in the
previous year or if the date of this year’s annual meeting
has been changed by more than 30 days from the date of the previous
year’s annual meeting, then the deadline is a reasonable time
before we begin to print and send our proxy materials. Therefore,
shareholder proposals intended to be presented at the 2018 annual
meeting must be received by us at our principal executive office no
later than December 13, 2017 in order to be eligible for inclusion
in our 2018 proxy statement and proxy relating to that meeting.
Upon receipt of any proposal, we will determine whether to include
such proposal in accordance with regulations governing the
solicitation of proxies.
You may
propose director candidates for consideration by the board’s
Nominating and Corporate Governance Committee. Any such
recommendations should include the nominee’s name and
qualifications for board membership, information regarding the
candidate as would be required to be included in a proxy statement
filed pursuant to SEC regulations, and a written indication by the
recommended candidate of her or his willingness to serve, and
should be directed to the Corporate Secretary of Cord Blood
America, Inc. at our principal executive offices at 1857 Helm
Drive, Las Vegas, NV 89119 within the time period described above
for proposals other than matters brought under SEC Rule
14a-8.
AVAILABILITY OF ANNUAL REPORT ON FORM 10-K
As
required, we have filed our 2016 10-K with the SEC. Shareholders
may obtain, free of charge, a copy of the 2016 10-K by writing to
us at 1857 Helm Drive, Las Vegas, NV 89119, Attention: Corporate
Secretary.
SHAREHOLDERS SHARING THE SAME LAST NAME AND ADDRESS
The SEC
has adopted rules that permit companies and intermediaries such as
brokers to satisfy delivery requirements for proxy statements with
respect to two or more shareholders sharing the same address by
delivering a single proxy statement addressed to those
shareholders. This process, which is commonly referred to as
“householding,” potentially provides extra convenience
for shareholders and cost savings for companies. We and some
brokers household proxy materials, delivering a single proxy
statement to multiple shareholders sharing an address unless
contrary instructions have been received from the affected
shareholders. Once you have received notice from your broker or us
that they are or we will be householding materials 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 proxy statement, or if you currently receive multiple
proxy statements and would prefer to participate in householding,
please notify your broker if your shares are held in a brokerage
account or us if you hold registered shares. You can notify us by
sending a written request to Cord Blood America, Inc., Attention:
Corporate Secretary, 1857 Helm Drive, Las Vegas, NV
89119.
WHERE YOU CAN FIND MORE INFORMATION
This
proxy statement refers to certain documents that are not presented
herein or delivered herewith. Such documents are available to any
person, including any beneficial owner of our shares, to whom this
proxy statement is delivered upon oral or written request, without
charge. Requests for such documents should be directed to Corporate
Secretary, Cord Blood America, Inc., 1857 Helm Drive, Las Vegas, NV
89119.
We file
annual and special reports and other information with the SEC.
Certain of our SEC filings are available over the Internet at the
SEC's web site at http://www.sec.gov. You may also read and copy
any document we file with the SEC at its public reference
facilities:
Public
Reference Room Office
100 F
Street, N.E.
Room
1580
Washington,
D.C. 20549
You may
also obtain copies of the documents at prescribed rates by writing
to the Public Reference Section of the SEC at 100 F Street, N.E.,
Room 1580, Washington, D.C. 20549. Callers in the United States can
also call 1-202-551-8090 for further information on the operations
of the public reference facilities.
BY
ORDER OF THE BOARD OF DIRECTORS
/s/ David Sandberg
David
Sandberg,
Chairman
Las
Vegas, NV
May __,
2017
APPENDIX A
ARTICLES OF AMENDMENT TO
AMENDED AND
RESTATED ARTICLES OF INCORPORATION
OF
CORD BLOOD AMERICA, INC.
Pursuant to
Sections 607.1006 of the Florida Business Corporation Act
(“FBCA”),
the undersigned Interim President of Cord Blood America, Inc. (the
“Corporation”),
a corporation organized and existing
under and by virtue of the laws of the State of Florida and bearing
Document Number P99000089885,
does hereby certify:
FIRST:
The
Board of Directors approved the following amendment to the
Corporation’s Amended and Restated Articles of Incorporation
by a unanimous written consent on April 28, 2017 pursuant to
Section 607.0821 of the FBCA, and recommended that the
Corporation’s shareholders approve such
amendment.
SECOND:
The
holders of at least two-thirds of the voting power of the
Corporation's shares entitled to vote for the election of directors
approved the following amendment to the Corporation’s Amended
and Restated Articles of Incorporation at a meeting of shareholders
held on July 19, 2017 in accordance with the provisions of the
Corporation's Amended and Restated Articles of Incorporation and
pursuant to Section 607.0704 of the FBCA. The number of votes cast
by the super-majority shareholders was sufficient for
approval.
THIRD:
Article III of the Corporation's Amended and
Restated Articles of Incorporation is hereby deleted in its
entirety and substituted with the following:
ARTICLE
III
BOARD OF DIRECTORS
The
business and affairs of the corporation shall be managed by or
under the direction of a Board of Directors consisting of not less
than one nor more than fifteen persons. The exact number of
Directors within the minimum and maximum limitations specified in
the preceding sentence shall be fixed from time to time by the
Board of Directors pursuant to a resolution adopted by a majority
of the entire Board of Directors. Directors shall hold office until
his or her successor is elected and qualified. No decrease in the
number of Directors constituting the Board of Directors shall
shorten the term of any incumbent Director.
FOURTH:
Article V of the Corporation's Amended and
Restated Articles of Incorporation is hereby deleted in its
entirety and substituted with the following:
ARTICLE V
AMENDMENT
The
corporation reserves the right to amend, alter, change or repeal
any provision contained in these Articles of Incorporation in the
manner now or hereafter prescribed by statute, and all rights
conferred on the shareholders of the corporation hereunder are
granted subject to this reservation.
FURTHER RESOLVED: That the effective
date of these Articles of Amendment shall be [●],
2017.
IN WITNESS WHEREOF, the undersigned,
being the Interim President of this Corporation, has executed these
Articles of Amendment to the Corporation’s Amended and
Restated Articles of Incorporation as of [●],
2017.
|
Cord
Blood America, Inc.
|
|
|
|
|
By:
|
|
|
|
Stephen
Morgan, Interim President
|
CORD BLOOD AMERICA, INC.
(the "Company")
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS
2017 ANNUAL MEETING OF SHAREHOLDERS - JULY 19, 2017 AT 10 AM
EST
|
|
|
|
|
|
CONTROL ID:
|
|
|
|
|
|
|
|
REQUEST ID:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The undersigned, revoking all prior proxies, hereby appoints
Stephen Morgan with full power of substitution in each, as proxies
for the undersigned, to represent the undersigned and to vote all
the shares of Common Stock of the Company which the undersigned
would be entitled to vote, as fully as the undersigned could vote
and act if personally present, at the 2017 Annual Meeting of
Shareholders (the "Annual Meeting") to be held on July 19,
2017 at 10:00 a.m., Eastern Standard Time, at _________, and
at any adjournments or postponements thereof and in their
discretion upon all other matters that may properly come before
said 2017 Annual Meeting and any adjournment thereof.
Should the undersigned be present and elect to vote at the Annual
Meeting or at any adjournments or postponements thereof, and after
notification to the Secretary of the Company at the Annual Meeting
of the undersigned’s decision to terminate this proxy, then
the power of such attorneys or proxies shall be deemed terminated
and of no further force and effect. This proxy may also be revoked
by filing a written notice of revocation with the Secretary of the
Company or by duly executing a proxy bearing a later
date.
|
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VOTING INSTRUCTIONS
|
|
|
|
|
|
|
If you vote by phone, fax or internet, please DO NOT mail your
proxy card.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MAIL:
|
Please mark, sign, date, and return this Proxy Card promptly using
the enclosed envelope.
|
|
|
|
|
|
|
INTERNET:
|
https://www.iproxydirect.com/CBAI
|
|
|
|
|
|
|
PHONE:
|
1-866-752-VOTE (8683)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 ANNUAL MEETING OF THE SHAREHOLDERS OFCORD BLOOD AMERICA,
INC.
|
PLEASE COMPLETE, DATE, SIGN AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN
HERE: ☒
|
PROXY
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
|
|
Proposal 1
|
|
|
FOR
|
|
AGAINST
|
|
|
|
|
|
|
Election of Directors:
Timothy
McGrath
|
|
☐
|
|
☐
|
|
|
|
CONTROL ID:
REQUEST ID:
|
|
Proposal 2
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
Ratification of the appointment of RBSM LLP as the Company’s
independent registered certified public accounting firm for the
fiscal year ending December 31, 2017.
|
|
☐
|
|
☐
|
|
☐
|
|
|
|
Proposal 3
|
|
|
FOR
|
|
AGAINST
|
|
ABSTAIN
|
|
|
|
|
Approval of an amendment to the Amended and Restated Articles of
Incorporation.
|
|
☐
|
|
☐
|
|
☐
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MARK “X” HERE IF YOU PLAN
TO ATTEND THE MEETING: ☐
|
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE
“FOR” THE REELECTION OF MR. MCGRATH TO THE BOARD OF
DIRECTORS AND “FOR” FOR PROPOSALS 2 AND 3.
THIS PROXY WILL BE VOTED AS DIRECTED. IF NO CONTRARY INSTRUCTION IS
INDICATED, THE VOTE OF THE UNDERSIGNED WILL BE CAST
“FOR” THE REELECTION OF MR. MCGRATH TO THE BOARD OF
DIRECTORS AND PROPOSALS 2 AND 3. IF ANY OTHER BUSINESS IS PRESENTED
AT THE ANNUAL MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN
THIS PROXY IN THEIR BEST JUDGMENT. AT THE PRESENT TIME, THE BOARD
OF DIRECTORS KNOWS OF NO OTHER BUSINESS TO BE PRESENTED AT THE
ANNUAL MEETING.
|
|
|
|
MARK HERE FOR ADDRESS CHANGE ☐ New Address (if applicable):
_____________________________________________
IMPORTANT: Please sign exactly
as your name or names appear on this Proxy. When shares are held
jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian, please give full
title as such. If the signer is a corporation, please sign full
corporate name by duly authorized officer, giving full title as
such. If signer is a partnership, please sign in partnership name
by authorized person.
Dated: ________________________, 2017
|
|
|
(Print Name of Shareholder and/or Joint Tenant)
|
|
(Signature of Shareholder)
|
|
(Second Signature if held jointly)
|