Pavmed Inc

The Stock Issuance Proposal asks shareholders to approve, under Nasdaq Listing Rule 5635, the issuance of common stock upon conversion of all Series D Preferred Stock sold in a private placement on February 3, 2026 (including up to 30,000 shares issuable upon exercise of related Warrants) and shares issuable upon conversion of the Amended and Restated Senior Secured Convertible Note (the 2026 Note) issued the same date as part of a Recapitalization. Management seeks approval because Nasdaq rules require shareholder approval for potential issuances that equal 20% or more of outstanding shares or that could effect a change of control; the conversions at the stated prices would exceed the 20% threshold and the conversion of the Series D Preferred Stock could result in an investor owning over 20% of common stock. Management contends the transactions simplify the capital structure by converting instruments with variable conversion terms into fixed-price convertibles, remove certain protective consent provisions upon conversion, provide additional working capital, and were negotiated at arms’ length with attractive terms. The board recommends a FOR vote, noting that approval would allow issuance of the shares and conversion that otherwise would be restricted by beneficial ownership and primary market limits until approval is obtained; the board also notes dilutive effects and potential price volatility as risks, and acknowledges that failure to approve will not undo the issuance of Series D Preferred Stock, Warrants, or the 2026 Note but will limit conversions and may impede capital-raising and allow investors to retain consent and redemption rights. The analysis should weigh the tradeoff between immediate dilution and the operational and capital benefits of simplifying the capital structure and access to capital, the presence of protective provisions and redemption mechanics for Series D, and the likelihood of an investor surpassing 20% ownership with attendant governance implications.

The Charter Amendment Proposal would amend the Certificate of Incorporation to allow stockholders holding a majority of the company’s outstanding voting power to remove any director, with or without cause, without declassifying the board. Management seeks approval as part of arrangements with Series D investors and as a governance compromise: the board retains a classified structure for continuity and independence while adding shareholder removal power to increase accountability. The board argues this balance retains takeover protections and stability of a staggered board while responding to investor demands and improving governance accountability. If approved, the amendment will become effective upon filing with the Delaware Secretary of State; it would not apply to directors elected by holders of any series of preferred stock to the extent provided in the applicable certificate of designation (so the Series D-elected director would not be removable under this amendment except as provided in the Series D Certificate of Designations). The Board recommends a FOR vote, noting it considered investor input and the transaction context in concluding the amendment is appropriate.

The proposal asks shareholders to approve an increase in the 2014 Long-Term Incentive Equity Plan by 1,500,000 shares to support hiring, retention and incentive compensation across employees, officers, directors and consultants. Management argues the increase is necessary to grant equity in connection with new hires, promotions and annual reviews and to align employee incentives without cash expenditures. The board notes that presently 130,119 of 213,517 shares have been granted (net of forfeitures), and that approval would result in plan shares representing about 15.9% of outstanding common stock assuming full conversion of the Series D Preferred Stock. Nasdaq listing rules require shareholder approval for material amendments to equity compensation plans. The board recommends FOR, citing retention, recruitment, conservation of cash, and alignment of interests as rationales, while acknowledging potential dilution.

The Adjournment Proposal requests authority to adjourn the Special Meeting to a later date to permit further solicitation of proxies if there are insufficient votes to approve the Stock Issuance, Charter Amendment, or Equity Plan proposals. Management recommends FOR the Adjournment Proposal because it provides flexibility to obtain additional votes necessary to approve the other proposals, allowing the Company to continue soliciting proxies, potentially reverse vote outcomes, and avoid additional logistical delays. The adjournment mechanism is typical for contested or insufficient-vote scenarios and does not itself change substantive company rights but can materially affect the likelihood that the Company ultimately secures approval for the other proposals.