UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
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FORM
CURRENT REPORT
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Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On June 20, 2024, Brainstorm Cell Therapeutics, Inc. (the “Company”) announced the appointment of Dr. Hartoun Hartounian as its Executive Vice President and Chief Operating Officer, effective as of June 24, 2024 (the “Start Date”).
Dr. Hartounian, age 64, led BioCentriq from inception to its $73 million acquisition by GC Holdings (Korea), acting as its founder and serving as a member of its board of directors, as well as its Chief Executive Officer and President, from May 2022 to December 2023. He also served as BioCentriq’s General Manager from June 2015 to May 2022. Prior to that, he co-founded DiaVacs and served as a member of its board of directors and as its Chief Executive Officer from February 2013 to April 2015. Additionally, he was the founder and Chief Executive Officer of Allied Bioventures from September 2011 to February 2013. From November 2008 to September 2011, he was Chief Executive Officer, President and a member of the board of directors of Vyteris Inc., where he led the company through a successful turnaround, reorganization, merger and business transformation, positioning it for growth and success in the Contract Research Organization industry. Further, Dr. Hartounian has been an affiliated faculty member at the New Jersey Institute of Technology in the Department of Chemistry and Environmental Sciences since April 2020, as well as an adjunct faculty member in the Department of Chemical Engineering at Columbia University from March 2015 to May 2022. Dr. Hartounian holds a Ph.D. in Chemical Engineering and a minor in Biochemistry from the University of Delaware, an M.S. in Chemical Engineering from the University of California and a B.S. in Chemical Engineering from Arya-Mehr (Sharif) University of Technology, where he was first-ranked in his class.
In connection with his appointment, the Company entered into an employment agreement (the “Employment Agreement”) with Dr. Hartounian that governs the terms of his employment with the Company. The Employment Agreement provides for an initial base annual salary of $450,000, an option to purchase 60,000 shares of the Company’s common stock (the “Option”), and a one-time grant of 30,000 shares of the Company’s restricted common stock (“Restricted Stock Grant”). The exercise price of the Option will be equal to the fair market value per share of the Company’s common stock as of the date on which such Option is granted, as determined by the Board. 25% of the shares underlying the Option shall vest and become exercisable on the first anniversary of the Start Date, and the remaining shares underlying the Option shall vest and become exercisable in equal quarterly installments thereafter, until fully vested and exercisable on the fourth anniversary of the grant date, provided that Dr. Hartounian remains continuously employed by the Company from the date of the grant through each of the applicable vesting dates. The Restricted Stock Grant shall vest in full on the first anniversary of the Start Date, provided that Dr. Hartounian remains continuously employed by the Company.
Additionally, pursuant to the Employment Agreement, Dr. Hartounian will be eligible for an annual cash bonus of up to 35% of his base salary, as well as a one-time signing bonus of ten thousand ($10,000) U.S. Dollars, payable within 60 days of his start date. Further, Dr. Hartounian will be eligible to participate in the Company’s employee benefits, including but not limited to a Section 401(k) retirement plan, as well as health, dental and long-term disability plans as are established by the Company and as are from time to time applicable to executives of the Company.
Pursuant to the Employment Agreement, if Dr. Hartounian is terminated “without cause” or resigns for “good reason” (in each case, as defined in the Employment Agreement), Dr. Hartounian will be entitled to, subject to his execution of and compliance with both a separation agreement and general release; his resignation from all positions he holds within the Company and its affiliate at the time of his termination or resignation; and his compliance with the provisions of his restrictive covenant agreement: (i) continuation of his base salary as of the date of termination for the six (6) month period that immediately follows the date of termination or resignation; (ii) a lump-sum payment in an amount equal to Dr. Hartounian’s full target annual bonus for any prior year’s annual bonus, as acknowledged by the Company and not paid as of the date of termination, for a prorated annual bonus calculated at the full target amount through the date of termination (subject to the Company’s acknowledgement that an annual bonus, or part of it, is owed to him); and (iii) if elected, up to six (6) months of the employer portion of the COBRA premium contributions.
The forgoing summary of the material terms of the Employment Agreement is qualified in its entirety by reference to the complete text of the Employment Agreement, a copy of which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the three months ended June 30, 2024.
There are no family relationships between Dr. Hartounian and any other director, executive officer or nominees thereof of the Company. There are no related party transactions between the Company and Dr. Hartounian that would require disclosure under Item 404(a) of Regulation S-K under the Securities Exchange Act of 1934, as amended.
A copy of the Company’s press release, published June 20, 2024 and announcing Dr. Hartounian’s appointment to Executive Vice President and Chief Operating Officer, is attached to this report as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
| Exhibit | Description No. | |
| 99.1 | Press Release issued by Brainstorm Cell Therapeutics Inc., dated June 20, 2024 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BRAINSTORM CELL THERAPEUTICS INC. | ||
| Date: June 20, 2024 | By: | /s/ Chaim Lebovits |
| Chaim Lebovits | ||
| Chief Executive Officer | ||
Exhibit 99.1
BrainStorm Cell Therapeutics Announces Appointment of Haro Hartounian Ph.D. as Chief Operating Officer
Appointment Completes Executive Readiness for Registrational Phase 3b ALS Study Launch
NEW YORK, June 20, 2024 /PRNewswire/ -- BrainStorm Cell Therapeutics Inc. (NASDAQ: BCLI), a leading developer of adult stem cell therapeutics for neurodegenerative diseases, today announced the appointment of Hartoun Hartounian Ph.D. as its new EVP and COO, effective as of June 24, 2024.
Dr. Hartounian brings a distinguished track record with over 32 years of experience in the biopharmaceutical industry, with a focus on cell and gene therapy. His career highlights include founding and leading BioCentriq, a state-of-the-art cell and gene therapy CDMO facility, which was successfully acquired for $73 million in 2022.
Dr. Hartounian founded and managed the growth of four biotechnology companies. He has a track record of achieving aggressive goals at large pharmaceutical, contract development and manufacturing organizations, as well as at start-up biotechnology companies.
In his new role, Dr. Hartounian will oversee all operational aspects of BrainStorm Cell Therapeutics, including CMC and commercialization. He has the right skillset to enhance the company’s operational efficiency and the strategic vision to support the commercial readiness of its therapeutic platforms including NurOwn® for amyotrophic lateral sclerosis (ALS).
Chaim Lebovits, President and CEO of Brainstorm Cell Therapeutics, commented, “We are pleased to welcome Dr. Hartounian to our team. His broad experience and proven track record will be invaluable as we continue to advance NurOwn, our investigational treatment for ALS. Dr. Hartounian brings the relevant expertise at this important time for the company to help us smoothly navigate CMC and commercialization complexities and to streamline logistics.”
Dr. Hartounian stated, “I am eager to join BrainStorm Cell Therapeutics at this exciting juncture and envision a tremendous opportunity to leverage my expertise in advancing the company’s innovative therapies. I am profoundly inspired by the groundbreaking work BrainStorm Cell Therapeutics has accomplished with NurOwn®, and I am impressed by the path forward set for the upcoming registrational Phase 3b study. The potential to transform the treatment landscape for neurodegenerative diseases is immense. I am pleased to join the talented team and to work with a robust technology platform. Together, I am confident in our ability to achieve our strategic objectives and deliver significant value to our patients and stakeholders.”
Dr. Hartounian founded BioCentriq, a full-service, collaborative, revenue generating CDMO company for cell and gene therapy, focusing on all stages of process development and clinical manufacturing. He served initially as the company’s General Manager (2015 to 2022) and then as its President, CEO and a member of the Board of Directors (2022 to 2023). He led BioCentriq from inception to its $73 million acquisition by GC Holdings (Korea). From 2013 to 2015, Dr. Hartounian was CEO, Co-Founder and a member of the Board of Directors at DiaVacs, a company specializing in cell therapy for type 1 diabetes. Prior to that, from 2011 to 2013 he was CEO and Co-Founder of Allied BioVentures. From 2008 to 2011, he was also President, CEO and a member of the Board of Directors of Vyteris Inc., where he led the company through a successful turnaround, reorganization, merger, and business transformation, positioning it for growth and success in the CRO industry.
Dr. Hartounian has also been an affiliated faculty member at the New Jersey Institute of Technology in the Department of Chemistry and Environmental Sciences since 2020, as well as an adjunct faculty member in the Department of Chemical Engineering at Columbia University from 2015 to 2022.
Additionally, Dr. Hartounian holds a Ph.D. in chemical engineering with a minor in biochemistry from the University of Delaware, an M.S. in chemical engineering from the University of California and a B.S. in Chemical Engineering from Arya-Mehr University
About BrainStorm Cell Therapeutics Inc.
BrainStorm Cell Therapeutics is a leading developer of innovative autologous adult stem cell therapeutics for debilitating neurodegenerative diseases. BrainStorm Cell Therapeutics holds the rights to clinical development and commercialization of the NurOwn® technology platform used to produce autologous MSC-NTF cells through an exclusive, worldwide licensing agreement. Autologous MSC-NTF cells have received Orphan Drug designation status from the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA) for the treatment of amyotrophic lateral sclerosis (ALS). BrainStorm Cell Therapeutics has completed a Phase 3 trial in ALS (NCT03280056); this trial investigated the safety and efficacy of repeat-administration of autologous MSC-NTF cells and was supported by a grant from the California Institute for Regenerative Medicine (CIRM CLIN2-0989), and another grant from the ALS Association and I AM ALS. BrainStorm Cell Therapeutics completed under an investigational new drug application a Phase 2 open-label multicenter trial (NCT03799718) of autologous MSC-NTF cells in progressive MS and was supported by a grant from the National MS Society (NMSS).
Notice Regarding Forward-Looking Statements
This press release contains “forward-looking statements” that are subject to substantial risks and uncertainties, including the clinical development of NurOwn as a therapy for the treatment of ALS, the future availability of NurOwn to patients, and the future success of BrainStorm Cell Therapeutics. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “target,” “aim,” “should,” “will” “would,” or the negative of these words or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on BrainStorm Cell Therapeutic’s current expectations and are subject to inherent uncertainties, risks and assumptions that are difficult to predict. These potential risks and uncertainties include, without limitation, management’s ability to successfully achieve its goals, BrainStorm’s ability to raise additional capital, BrainStorm Cell Therapeutic’s ability to continue as a going concern, prospects for future regulatory approval of NurOwn, whether BrainStorm Cell Therapeutic’s future interactions with the FDA will have productive outcomes, and other factors detailed in BrainStorm Cell Therapeutic’s annual report on Form 10-K and quarterly reports on Form 10-Q available at http://www.sec.gov. These factors should be considered carefully, and readers should not place undue reliance on BrainStorm Cell Therapeutic’s forward-looking statements.
The forward-looking statements contained in this press release are based on the beliefs, expectations, and opinions of management as of the date of this press release. We do not assume any obligation to update forward-looking statements to reflect actual results or assumptions if circumstances or management’s beliefs, expectations or opinions should change, unless otherwise required by law. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements.
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SOURCE BrainStorm Cell Therapeutics Inc.