UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities Exchange Act
of 1934 (Amendment No. )
Check the appropriate box:
[x] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule 14c-5
(d)(2))
[ ] Definitive Information Statement
ORTHODONTIX, INC.
(Name of Registrant As Specified in Charter)
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filing fee is calculated and state how it was determined):
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ORTHODONTIX, INC.
1428 Brickell Avenue, Suite 105
Miami, FL 33131
Dear Shareholders:
We are writing to advise you that we intend to amend our Articles of
Incorporation to change our name to Protalix BioTherapeutics, Inc. and that
we are terminating our 1998 Stock Option Plan and adopting the 2006 Stock
Incentive Plan. These actions were approved on December 14, 2006 by our
Board of Directors. In addition, the holders of a majority of our issued and
outstanding voting securities also approved these actions on December 14,
2006, by written consent in lieu of a special meeting in accordance with the
relevant sections of the Florida Business Corporation Act. We will file the
Articles of Amendment to our Articles of Incorporation, a copy of which is
attached hereto as Exhibit A, to change our name with the Secretary of State
of Florida on or about January 15, 2007.
As described hereafter, these actions are required by the terms of our
merger agreement (the "Merger Agreement") with Protalix Ltd., an Israeli
biotechnology company, and Protalix Acquisition Co., Ltd., an Israeli company
that is our wholly-owned subsidiary and was formed to complete the merger
(the "Merger"). If the Merger is not completed for any reason, we will not
take the actions described in this information statement.
WE ARE NOT ASKING YOU FOR A PROXY, AND YOU ARE REQUESTED NOT TO SEND US
A PROXY.
No action is required by you. The accompanying Information Statement is
furnished only to inform our shareholders of the actions described above
before they take place in accordance with Rule 14c-2 of the Securities
Exchange Act of 1934. This Information Statement is first mailed to you on
or about December 26, 2006.
Please feel free to call us at (305) 371-4112 should you have any
questions on the enclosed Information Statement. We thank you for your
continued interest in Orthodontix.
For the Board of Directors of
Orthodontix, Inc.
By:/s/Glenn L. Halpryn
---------------------------------------
Glenn L. Halpryn,
Chairman and President
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ORTHODONTIX, INC.
1428 Brickell Avenue, Suite 105
Miami, Florida 33131
Telephone (305) 371-4112
INFORMATION STATEMENT REGARDING
ACTION TO BE TAKEN BY WRITTEN CONSENT OF
MAJORITY SHAREHOLDERS
IN LIEU OF A SPECIAL MEETING
WE ARE NOT ASKING YOU FOR A PROXY,
AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
GENERAL
This Information Statement is being furnished to the shareholders of
Orthodontix, Inc., a Florida corporation (the "Company") in connection with
the adoption of an Amendment to our Articles of Incorporation by written
consent of our Board of Directors and the holders of a majority of our issued
and outstanding voting securities in lieu of a special meeting. On December
14, 2006 our Board of Directors approved an amendment to our Articles of
Incorporation to change our name to Protalix BioTherapeutics, Inc. (the
"Amendment"). This action will become effective on the date of filing the
Amendment with the Florida Secretary of State (the "Effective Date of the
Amendment") in accordance with the written consent of our directors and the
holders of a majority of our issued and outstanding common stock and in
accordance with the relevant sections of the Florida Business Corporation
Act.
On December 14, 2006, our Board of Directors also terminated our 1998
Stock Option Plan and adopted the 2006 Stock Incentive Plan. This action was
also approved by written consent on the same date by the holders of a
majority of our issued and outstanding voting securities. The terms of the
2006 Stock Incentive Plan are similar to the terms of the stock option plan
of Protalix Ltd., and we are obligated to assume the obligations of Protalix
Ltd. under its plan following the Merger. There are no stock options
outstanding under our 1998 Stock Option Plan, and we concluded that it would
be preferable to adopt a new incentive plan rather than to amend our 1998
Stock Option Plan.
As of December 11, 2006 there are 5,830,856 shares of our common stock
issued and outstanding. The following shareholders who collectively own
approximately 57% of our outstanding common stock, which is in excess of the
required majority of outstanding voting securities necessary for the adoption
of this action, have executed a written consent approving the Amendment:
Shareholder No. of Shares Owned
Frost Gamma Investments Trust 2,965,428
Glenn L. Halpryn 380,100
TOTAL ----------
3,345,528
==========
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As described hereafter, these actions are required by the terms of the
Merger Agreement.
The elimination of the need for a meeting of shareholders to approve
this action is made possible by Section 607.0704 of the Florida Business
Corporation Act, which provides that the written consent of the holders of
outstanding shares of voting stock, having not less than the minimum number
of votes that would be necessary to authorize or take such action at a
meeting at which all shares entitled to vote thereon were present and voted,
may be substituted for such a meeting. In order to eliminate the costs
involved in holding a special meeting, our Board of Directors voted to
utilize the written consent of the holders of a majority in interest of our
voting securities.
Pursuant to Section 607.0704 of the Florida Business Corporation Act, we
are required to provide prompt notice of the taking of the corporate action
without a meeting of shareholders to all shareholders who did not consent in
writing to such action. This Information Statement serves as this notice.
This Information Statement is first being mailed on or about December 26,
2006 to shareholders of record, and is being delivered to inform you of the
corporate actions described herein before they take effect in accordance with
Rule 14c-2 of the Securities Exchange Act of 1934.
The entire cost of furnishing this Information Statement will be borne
by the Company. We will request brokerage houses, nominees, custodians,
fiduciaries and other like parties to forward this Information Statement to
the beneficial owners of our voting securities held of record by them, and we
will reimburse such persons for out-of-pocket expenses incurred in forwarding
such material.
No Dissenter's Rights
No dissenter's rights are afforded to our shareholders under Florida law
as a result of the adoption of the Amendment.
OUR PRINCIPAL SHAREHOLDERS
Our voting securities are comprised of our common stock. The holders of
our common stock are entitled to one vote for each outstanding share on all
matters submitted to our shareholders. The following table contains
information regarding record ownership of our common stock as of December 11,
2006 held by:
* persons who own beneficially more than 5% of our outstanding
voting securities,
* our directors,
* named executive officers, and
* all of our directors and officers as a group.
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Name and Address Shares of Common Stock Percent
of Beneficial Owner Beneficially Owned(1) Owned
------------------------------------------------------------------
Phillip Frost, M.D. 2,965,428(2) 51.0 %
4400 Biscayne Blvd.
Miami, FL 33137
Stephen Grussmark 450,000(3) 7.7 %
7400 North Kendall Drive Suite 704
Miami, FL 33156
Glenn L. Halpryn 380,100 6.5 %
1428 Brickell Avenue, Suite 105
Miami, FL 33131
Alan Jay Weisberg 4,201 0.07%
1428 Brickell Avenue, Suite 105
Miami, FL 33131
Noah Silver 0 0.0 %
1428 Brickell Avenue, Suite 105
Miami, FL 33131
Curtis Locksin 0 0.0 %
1428 Brickell Avenue, Suite 105
Miami, FL 33131
All Officers and 384,301 6.6 %
Directors as a Group(2)
Total Shares Outstanding
as of December 11, 2006 5,830,856
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission. In computing the number of shares
beneficially owned by a person and the percentage ownership of that person,
shares of common stock subject to options or warrants held by that person
that are currently exercisable or will become exercisable within 60 days
after December 11, 2006 are deemed outstanding, while such shares are not
deemed outstanding for purposes of computing percentage ownership of any
other person. Unless otherwise indicated in the footnotes below, the persons
and entities named in the table have sole voting and investment power with
respect to all shares beneficially owned, subject to community property laws
where applicable.
(2) Represents shares of Common Stock held by Frost Gamma Investments Trust,
of which Frost Gamma Limited Partnership is the sole and exclusive
beneficiary. Dr. Frost is the sole limited partner of Frost Gamma, L.P. The
general partner of Frost Gamma, L.P. is Frost Gamma, Inc. and the sole
shareholder of Frost Gamma, Inc. is Frost-Nevada Corporation. Dr. Frost is
also the sole shareholder of Frost-Nevada Corporation.
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(3) Represents shares of Common Stock held in various trusts for which
either Dr. Grussmark or his wife is the sole trustee and the beneficiaries of
which are Dr. Grussmark, his wife or his children.
Dr. Phillip Frost, a shareholder in Orthodontix, and Glenn L. Halpryn,
Chairman of our Board of Directors and a shareholder of Orthodontix,
purchased stock in Protalix Ltd. in September 2006, along with other
investors, to facilitate the Merger.
THE AMENDMENT
On December 11, 2006, we had 5,830,856 shares of our common stock
outstanding. Currently, there are 1,500,000,000 shares of common stock
authorized. There are also 100,000,000 shares of preferred stock authorized,
none of which have ever been issued.
We originally incorporated as Embassy Acquisition Corp. in 1995 and
changed our name to Orthodontix, Inc. in April 1998 when we entered the
orthodontic practice management business. In connection with the Merger, we
agreed to change our name to Protalix BioTherapeutics, Inc., which we believe
will more accurately describe our business following the Merger and will
preserve the identity of the operating company Protalix, Ltd.
EMPLOYEE BENEFIT AND STOCK PLANS
In connection with the Merger, we intend to reduce the number of our
authorized shares and the number of our issued and outstanding shares by
effecting a one-for-ten reverse stock split. The reverse stock split will
become effective upon the filing of articles of amendment to our articles of
incorporation with the Secretary of State of Florida immediately prior to the
Merger. All references to our common stock in the "Employee Benefit and
Stock Plans" section of this Information Statement have been adjusted for the
reverse split.
Immediately prior to the closing of the Merger, Protalix Ltd. had
outstanding options to purchase 88,624 ordinary shares under its employee
stock option plan. Pursuant to the terms of the Merger Agreement, we assumed
all of the outstanding obligations under such plan and, accordingly, we
anticipate issuing 5,413,249 shares of our common stock upon the exercise of
such options in lieu of shares of Protalix Ltd.
Our Board of Directors and a majority of our stockholders approved our
2006 Stock Incentive Plan on December 14, 2006. We have reserved 9,741,655
shares of our common stock for issuance, in the aggregate, under the 2006
Stock Incentive Plan, subject to adjustment for a stock split, or any future
stock dividend or other similar change in our common stock or our capital
structure. No options to purchase shares of common stock have been granted
under the 2006 Stock Incentive Plan; however, we anticipate issuing options
to purchase 5,413,249 shares of our common stock under such plan upon the
closing of the Merger.
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2006 Stock Incentive Plan
Our 2006 Stock Incentive Plan provides for the grant of stock options,
restricted stock, restricted stock units, stock appreciation rights and
dividend equivalent rights, collectively referred to as "awards." Stock
options granted under the 2006 Stock Incentive Plan may be either incentive
stock options under the provisions of Section 422 of the Internal Revenue
Code, or non-qualified stock options. Incentive stock options may be granted
only to employees. Awards other than incentive stock options may be granted
to employees, directors and consultants. The 2006 Stock Incentive Plan is
also in compliance with the provisions of the Israeli Income Tax Ordinance
[New Version], 1961 (including as amended pursuant to Amendment 132 thereto)
and is intended to enable us to grant awards to grantees who are Israeli
residents as follows: (i) awards to employees pursuant to Section 102 of the
Tax Ordinance (definition refers only to employees, office holders and
directors of our Company or a related entity excluding those who are
considered "Controlling Shareholders" pursuant to the Tax Ordinance); and
(ii) awards to non-employees pursuant to Section 3(I) of the Tax Ordinance.
In accordance with the terms and conditions imposed by the Tax Ordinance,
grantees who receive awards under the 2006 Stock Incentive Plan may be
afforded certain tax benefits in Israel as described below.
Our Board of Directors or the compensation committee, referred to as the
"plan administrator," will administer our 2006 Stock Incentive Plan,
including selecting the grantees, determining the number of shares to be
subject to each award, determining the exercise or purchase price of each
award, and determining the vesting and exercise periods of each award.
The exercise price of stock options granted under the 2006 Stock
Incentive Plan must be equal to at least 100% of the fair market value of our
common stock on the date of grant; however, in certain circumstances, grants
may be made at a lower price to Israeli grantees who are residents of the
State of Israel. If, however, incentive stock options are granted to an
employee who owns stock possessing more than 10% of the voting power of all
classes of our stock or the stock of any parent or subsidiary of our Company,
the exercise price of any incentive stock option granted must equal at least
110% of the fair market value on the grant date and the maximum term of these
incentive stock options must not exceed five years. The maximum term of all
other awards must not exceed 10 years. The plan administrator will determine
the exercise or purchase price (if any) of all other awards granted under the
2006 Stock Incentive Plan.
Under the 2006 Stock Incentive Plan, incentive stock options and options
to Israeli grantees may not be sold, pledged, assigned, hypothecated,
transferred or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised during the lifetime of the
participant only by the participant. Other awards shall be transferable by
will or by the laws of descent or distribution and to the extent and in the
manner authorized by the plan administrator by gift or pursuant to a domestic
relations order to members of the participant's immediate family. The 2006
Stock Incentive Plan permits the designation of beneficiaries by holders of
awards, including incentive stock options.
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In the event the service of a participant in the 2006 Stock Incentive
Plan is terminated for any reason other than cause, disability or death, the
participant may exercise awards that were vested as of the termination date
for a period ending upon the earlier of 12 months or the expiration date of
the awards unless otherwise determined by the plan administrator.
In the event of a corporate transaction or a change of control, all
awards will terminate unless assumed by the successor corporation. Unless
otherwise provided in a participant's award agreement, in the event of a
corporate transaction for the portion of each award that is assumed or
replaced, then such award will automatically become fully vested and
exercisable immediately upon termination of a participant's service if the
participant is terminated by the successor company or us without cause within
twelve months after the corporate transaction. For the portion of each award
that is not assumed or replaced, such portion of the award will automatically
become fully vested and exercisable immediately prior to the effective date
of the corporate transaction so long as the participant's service has not
been terminated prior to such date.
In the event of a change in control, except as otherwise provided in a
participant's award agreement, following a change in control (other than a
change in control that also is a corporate transaction) and upon the
termination of a participant's service without cause within twelve months
after a change in control, each award of such participant that is outstanding
at such time will automatically become fully vested and exercisable
immediately upon the participant's termination.
Under our 2006 Stock Incentive Plan, a corporate transaction is
generally defined as:
* a merger or consolidation in which we are not the surviving entity,
except for the principal purpose of changing our company's state of
incorporation;
* the sale, transfer or other disposition of all or substantially all of
our assets;
* the complete liquidation or dissolution of our Company;
* any reverse merger in which we are the surviving entity but our shares
of common stock outstanding immediately prior to such merger are converted or
exchanged by virtue of the merger into other property, whether in the form of
securities, cash or otherwise, or in which securities possessing more than
forty percent (40%) of the total combined voting power of our outstanding
securities are transferred to a person or persons different from those who
held such securities immediately prior to such merger; or
* acquisition in a single or series of related transactions by any
person or related group of persons of beneficial ownership of securities
possessing more than fifty percent (50%) of the total combined voting power
of our outstanding securities but excluding any such transaction or series of
related transactions that the plan administrator determines not to be a
corporate transaction (provided, however, that the administrator shall have
no discretion in connection with a corporate transaction for the purchase of
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all or substantially all of our shares unless the principal purpose of such
transaction is changing our Company's state of incorporation).
Under our 2006 Stock Incentive Plan, a change of control is defined as:
* the direct or indirect acquisition by any person or related group of
persons of beneficial ownership of securities possessing more than fifty
percent (50%) of the total combined voting power of our outstanding
securities pursuant to a tender or exchange offer made directly to our
stockholders and which a majority of the members of our board (who have
generally been on our board for at least 12 months) who are not affiliates or
associates of the offeror do not recommend stockholders accept the offer, or
* a change in the composition of our board over a period of twelve
months or less, such that a majority of our board members ceases, by reason
of one or more contested elections for board membership, to be comprised of
individuals who were previously directors of our Company.
Unless terminated sooner, the 2006 Stock Incentive Plan will
automatically terminate in 2016. Our Board of Directors has authority to
amend, suspend or terminate our 2006 Stock Incentive Plan. No amendment,
suspension or termination of the 2006 Stock Incentive Plan shall adversely
affect any rights under awards already granted to a participant. To the
extent necessary to comply with applicable provisions of federal securities
laws, state corporate and securities laws, the Internal Revenue Code, the
rules of any applicable stock exchange or national market system, and the
rules of any non-U.S. jurisdiction applicable to awards granted to residents
therein (including the Tax Ordinance), we shall obtain shareholder approval
of any such amendment to the 2006 Stock Incentive Plan in such a manner and
to such a degree as required.
Impact of Israeli Tax Law
The awards granted to employees pursuant to Section 102 of the Tax
Ordinance under the 2006 Stock Incentive Plan may be designated by us as
approved options under the capital gains alternative, or as approved options
under the ordinary income tax alternative.
To qualify for these benefits, certain requirements must be met,
including registration of the options in the name of a trustee. Each option,
and any shares of common stock acquired upon the exercise of the option, must
be held by the trustee for a period commencing on the date of grant and
deposit into trust with the trustee and ending 24 months thereafter.
Under the terms of the capital gains alternative, we may not deduct
expenses pertaining to the options for tax purposes.
Under the 2006 Stock Incentive Plan, we may also grant to employees
options pursuant to Section 102(c) of the Tax Ordinance that are not required
to be held in trust by a trustee. This alternative, while facilitating
immediate exercise of vested options and sale of the underlying shares, will
subject the optionee to the marginal income tax rate of up to 50% as well as
payments to the National Insurance Institute and health tax on the date of
the sale of the shares or options. Under the 2006 Stock Incentive Plan, we
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may also grant to non-employees options pursuant to Section 3(I) of the Tax
Ordinance. Under that section, the income tax on the benefit arising to the
optionee upon the exercise of options and the issuance of common stock is
generally due at the time of exercise of the options.
Such options shall be further subject to the terms of the tax ruling
that has been obtained by Protalix Ltd. from the Israeli tax authorities in
connection with the Merger. Under the tax ruling, the options issued by us
in connection with the assumption of 102 options previously issued by
Protalix Ltd. under the capital gains alternative shall be issued to a
trustee, shall be designated under the capital gains alternative and the
issuance date of the original options shall be deemed the issuance date for
the assumed options for the calculation of the respective holding period.
WHERE YOU CAN OBTAIN ADDITIONAL INFORMATION
We are required to file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms at 100 F Street, N.E,
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. Please call the SEC at 1-
800-SEC-0330 for more information on the operation of the public reference
rooms. Copies of our SEC filings are also available to the public from the
SEC's web site at www.sec.gov.
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EXHIBIT A
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
ORTHODONTIX, INC.
Document Number P95000091803
1. The name of the corporation filing these Articles of Amendment is
Orthodontix, Inc. (the "Corporation").
2. Article I of the Articles of Incorporation of the Corporation is
amended as follows to change the Corporation's name:
Article I-Name
The name of the corporation is Protalix BioTherapeutics, Inc. (the
"Corporation").
3. The foregoing amendment was duly adopted by unanimous written consent
of the directors and a majority of the shareholders of the Corporation on
December 14, 2006.
IN WITNESS WHEREOF, the undersigned President and Secretary of
Orthodontix, Inc. have executed these Articles of Amendment on behalf of the
Corporation on this __ day of January, 2007.
ORTHODONTIX, INC.
By:___________________________
Glenn L. Halpryn, President
By____________________________
Alan Jay Weisberg, Secretary
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