Certain principal shareholders as well
as our executive officers and directors together beneficially own approximately 59.3% of our common shares. Depending on the level
of attendance at our general meetings of shareholders, these shareholders may be in a position to determine the outcome of decisions
taken at any such general meeting. To the extent that the interests of these shareholders may differ from the interests of the
company’s other shareholders, the latter may be disadvantaged by any action that these shareholders may seek to pursue. Among
other consequences, this concentration of ownership may have the effect of delaying or preventing a change in control and might
therefore negatively affect the market price of our common shares.
Future sales, or the possibility of future
sales, of a substantial number of our common shares could adversely affect the price of our common shares.
Future sales of a substantial number of
our common shares, or the perception that such sales will occur, could cause a decline in the market price of our common shares.
If certain of our shareholders sell substantial amounts of common shares in the public market, or the market perceives that such
sales may occur, the market price of our common shares and our ability to raise capital through an issue of equity securities in
the future could be adversely affected. We also entered into a registration rights agreement in connection with the Series E Private
Placement with certain investors in the Series E Private Placement pursuant to which we agreed under certain circumstances to file
a registration statement to register the resale of the common shares held by certain of our existing shareholders, as well as to
cooperate in certain public offerings of such common shares. In August 2018, we filed a registration statement on Form F-3 to register
the resale of one of our shareholder’s common shares pursuant to the requirements of the registration rights agreement. In
addition, we have adopted a new omnibus equity incentive plan under which we have the discretion to grant a broad range of equity-based
awards to eligible participants. These shares were registered pursuant to the registration statement on Form S-8 that we filed
with the SEC and, therefore, can be freely sold in the public market upon issuance, subject to volume limitations applicable to
affiliates. If a large number of our common shares or securities convertible into our common shares are sold in the public market
after they become eligible for sale, the sales could reduce the trading price of our common shares and impede our ability to raise
We have broad discretion in the use of our
cash and cash equivalents and short-term financial assets (liquidity) and may not use them effectively.
Our management will have broad discretion
in the application of our cash and cash equivalents and short-term financial assets. Our or our collaboration partners’ decisions
concerning the allocation of research, development, collaboration, management and financial resources toward particular product
candidates or therapeutic areas may not lead to the development of any viable commercial product and may divert resources away
from better opportunities. If we make incorrect determinations regarding the viability or market potential of any of our programs
or product candidates or misread trends in the biopharmaceutical industry, in particular for neurodegenerative diseases, our business,
financial condition and results of operations could be materially adversely affected. As a result, we may fail to capitalize on
viable commercial products or profitable market opportunities, be required to forego or delay pursuit of opportunities with other
product candidates or other diseases and disease pathways that may later prove to have greater commercial potential than those
we choose to pursue, or relinquish valuable rights to such product candidates through collaboration, licensing or other royalty
arrangements in cases in which it would have been advantageous for us to invest additional resources to retain sole development
and commercialization rights. We regularly review the designation of each program as core or seed, and terminate those programs
which do not meet our development criteria.
We do not expect to pay dividends
in the foreseeable future.
We have not paid any dividends since our
incorporation. Even if future operations lead to significant levels of distributable profits, we currently intend that any earnings
will be reinvested in our business and that dividends will not be paid until we have an established revenue stream to support continuing
dividends. Under our articles of association, the declaration of dividends requires a resolution passed by a simple majority of
the votes cast at a shareholder’s meeting regardless of abstentions and empty or invalid votes. The proposal to pay future
dividends to shareholders will in addition effectively be at the discretion of our board of directors after taking into account
various factors including our business prospects, liquidity requirements, financial performance and new product development. In
addition, payment of future dividends is subject to certain limitation pursuant to Swiss law or by our articles of association.
Accordingly, investors cannot rely on dividend income from our common shares and any returns on an investment in our common shares
will likely depend entirely upon any future appreciation in the price of our common shares.
We are a Swiss corporation. The rights of our
shareholders may be different from the rights of shareholders in companies governed by the laws of U.S. jurisdictions.