Minneapolis biotechnology company under SEC investigation

Foxo Technologies Inc. is under investigation by the U.S. Securities and Exchange Commission.

Minneapolis-based Foxo said late Monday the regulatory agency is seeking documents related to Jon Sabes’ termination as CEO and his resignation from the company’s board of directors, according to an SEC filing.

The agency also is looking at Steven Sabes’ termination as chief operating officer.

The SEC contacted Foxo on March 3, the company said in the filing.

Foxo’s board of directors terminated Jon Sabes, who had founded the company, in November. At the same time it dismissed his brother Steven Sabes as COO.

The move came just two months after Foxo went public through a merger with a special purpose acquisition company. Foxo was the only newly public company in Minnesota in 2022.

After firing Jon Sabes as the company’s top executive, the board allowed him to remain as a director. Jon Sabes then resigned the board in late January with a one-sentence email.

Foxo’s filing indicated that the company is “voluntarily responding to the SEC’s request.”

Foxo has been developing a saliva test designed to harvest epigenetic information that could be sold to life insurance companies for use with policy underwriting.

In a January SEC filing, the company provided more detail about its decision to part ways with Jon Sabes: “The board determined to terminate Jon Sabes as chief executive officer and chairman of the board because it had lost confidence in his ability to act in an executive officer capacity of the company following the company’s business combination with Delwinds Insurance Acquisition Corp., and its increased obligations as a public company.”

Foxo remains a startup company with nominal sales. In November, the company reported revenue of $93,000 for the first nine months of 2022 and net losses of $76.9 million.

The company has not reported fourth quarter and full-year results for 2022.

The day before Foxo went public the stock for Texas-based Delwinds Insurance Acquisition Corp., the SPAC acquiring the company, closed at $8.40 per share.

Foxo’s stock closed at 32 cents per share on Monday, down more than 96% from the last closing price for the SPAC.

Foxo’s Monday filing noted that the investigation itself is not evidence of any wrongdoing.

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