Re: Stockholder Action Letter: Request for Vote!

Dear Fellow Stockholders:

 

I am writing to ask for your support on the proposals described in our 2023 Definitive Proxy Statement, filed with the SEC on April 28, 2023. In particular, I am asking you to vote FOR Proposal 4, the reverse split proposal. We believe that if the reverse split proposal is not approved, our ability to prudently raise capital may be compromised, our ability to attract and retain critical talent may be impacted, and our ability to act strategically with regard to the use of our equity in future opportunistic transactions may be constrained, among other things. Implementing a reverse split would provide the flexibility we need to use our common stock for business and/or financial purposes. Our reverse split proposal is a request to support a constructive tool that we believe is essential to achieving our long-term goals.

 

Bionano’s business has been progressing and still requires ongoing innovation and investment.

 

Bionano is focused on transforming traditional cytogenetic workflows into a modern, molecular workflow based on optical genome mapping (OGM). Current cytogenetic workflows are antiquated, slow and fail to provide useful results in roughly 50% of cases. Numerous published studies from laboratories and hospitals around the world have demonstrated that OGM has the potential to replace traditional cytogenetic methods, including fluorescence in situ hybridization (FISH), karyotyping, southern blot and chromosomal microarrays, with the OGM workflow as an alternative that is streamlined, yields useful results in substantially more samples, is less costly, and is simpler and faster. OGM has applications in cancer, genetic disease and cell bioprocessing quality control for drug development.

 

We have made extraordinary progress since the summer of 2020, enabled by the advancements in market development and product development, and accelerated by the capital we raised in early 2021.

 

 

 

We believe the progress made in the preceding three years reflects the early adoption of OGM by clinical researchers seeking to adopt a new and novel method and demonstrate its utility. Going forward, our strategy for 2023 through 2025 is to continue that momentum and, among other things, achieve between a 30% to 50% compound annual growth rate for revenue. Our 2023 to 2025 strategy includes:

 

 

A vote FOR Proposal 4 would enable management to invest prudently in the business and to continue driving progress

 

We believe it is imperative for stockholders to authorize Bionano’s Board of Directors to effect a reverse split, as outlined in Proposal 4, to continue and potentially accelerate the momentum begun in 2020 and to deliver on the strategy outlined above. There are three primary outcomes of a reverse split that management believes are critical to realize:

 

 

In order to ensure that we can respect the voices of those who vote, we issued one share of Series A Preferred Stock to the Chairman of our Board of Directors. The share of Series A Preferred Stock has 3,000,000,000 votes, but those votes must be voted in the same proportion as the votes cast by our common stockholders and can only vote on Proposal 4. The votes of the preferred share would not change the voice of shareholders who vote but would simply mirror their votes so that in the event there are more than a majority of the votes cast in favor of Proposal 4, there should be enough votes to pass the proposal. The Series A Preferred Stock will be redeemed and retired automatically after approval of a reverse stock split proposal pursuant to its terms.

 

 

For other companies, a request for authorization to effect a reverse split may reflect a sign of distress. We believe that the reverse split proposal is not a sign of distress for Bionano. Instead, it is a mechanism to enable management to prudently raise capital in support of our long-term strategy.

 

Please support management by voting FOR all proxy proposals. Most importantly please support management by voting FOR Proposal 4.

 

Sincerely,

This letter contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipate,” “believe,” “continue,” “could,” “expect,” “intend,” “may,” “plan,” “will,” “should” and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) convey uncertainty of future events or outcomes and are intended to identify these forward-looking statements. Forward-looking statements include statements regarding our intentions, beliefs, projections, outlook, analyses or current expectations concerning, among other things: (1) the anticipated benefits of the reverse split, including on the marketability and liquidity of our common stock, our ability to execute on our long-term strategy and our compliance with Nasdaq listing requirements; (2) the utility of OGM for applications cancer, genetic disease and cell bioprocessing quality control, and its ability to complement or replace traditional cytogenomic methods for analysis of structural variations; (3) our anticipated goals and milestones for OGM and Bionano, including improved adoption of OGM, reimbursement of OGM through clinical research and FDA clearance to market OGM for clinical use; (4) our growth prospects and estimates regarding future financial performance and operating results; (5) our future products and features, including the performance of these products and their sample processing capacity; and (6) our anticipated growth strategies and anticipated trends in our business. Each of these forward-looking statements involves risks and uncertainties. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Factors that may cause such a difference include the risks and uncertainties associated with: the impact of geopolitical and macroeconomic developments, such as recent and potential future bank failures, the ongoing Ukraine-Russia conflict, related sanctions and the COVID-19 pandemic, on our business and the global economy; challenges inherent in developing, manufacturing and commercializing products; our ability to further deploy new products and applications and expand the markets for our technology platforms; third parties’ abilities to manufacture our instruments and consumables; our assumptions, expectations and beliefs regarding future growth of the business and the markets in which we operate; the completion and success of our clinical studies; the success of products competitive with our own; changes in our strategic and commercial plans; the application of generally accepted accounting principles, which are highly complex and involve many subjective assumptions; study results that are different from or contradict the results presented in this letter; our assumptions and estimates regarding our future financial performance and results of operations; our ability to obtain sufficient financing to fund our strategic plans and commercialization efforts; and the risks and uncertainties associated with our business and financial condition in general, including the risks and uncertainties described in our filings with the Securities and Exchange Commission, including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2022 and in other filings subsequently made by us with the Securities and Exchange Commission. All forward-looking statements contained in this press release speak only as of the date on which they were made and are based on management’s assumptions and estimates as of such date. We do not undertake any obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events or otherwise, except as required by law.