AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON August 16, 2007
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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ELITE PHARMACEUTICALS, INC.
(Exact name of Registrant as specified in its charter)
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DELAWARE 2834 22-3542636
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdiction of Classification Code Number) Identification
incorporation or Number)
organization)
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BERNARD BERK, CHIEF EXECUTIVE OFFICER
ELITE PHARMACEUTICALS, INC.
165 LUDLOW AVENUE
NORTHVALE, NEW JERSEY 07647
(201) 750-2646
(Name, address, including zip
code, and telephone number, including area code,
of registrant's principal executive offices
and agent for service)
With copies to:
SCOTT H. ROSENBLATT, ESQ.
GARY M. EMMANUEL, ESQ.
REITLER BROWN & ROSENBLATT, LLC
800 THIRD AVENUE, 21ST FLOOR
NEW YORK, NEW YORK 10022-4611
(212) 209-3050
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or reinvestment plans, please check the following box. |_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, check the following box. |X|
If this Form is filed to register additional securities pursuant to
Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act Registration Statement number of the earlier effective
Registration Statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act Registration Statement number of the earlier effective Registration
Statement for the same offering. |_|
If this form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the
Securities Act, check the following box. |_|
If this form is a post-effective amendment to a registration statement
pursuant to General Instruction I.D. filed to register additional securities or
additional classes of securities pursuant to Rule 413(b) under the Securities
Act, check the following box. |_|
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Shares of maximum maximum
common stock offering aggregate
Title of each class of to be price per offering Amount of
securities to be registered registered(1) share(2) price registration fee
--------------------------- --------------- -------- ----- ----------------
Common Stock, par value $.01 per share 4,220,122(3) $2.18 $9,199,866 $282.44
(1) In accordance with Rule 416 under the Securities Act of 1933, as
amended, this registration statement also registers the resale by the
selling stockholders of any additional shares of our common stock which
become issuable in connection with such shares because of any stock
dividend, stock split, recapitalization or other similar transaction
effected without the receipt of consideration which results in an
increase in the number of outstanding shares of our common stock.
(2) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933, as
amended, and based on the average of the high and low sale price per
share of shares of the common stock on the American Stock Exchange on
August 10, 2007.
(3) Consists of (i) 3,508,923 shares of our common stock issuable upon
conversion of outstanding shares of our Series C Preferred Stock issued
in a private placement that closed on July 17, 2007 and shares of
common stock issuable in satisfaction of certain Series C Preferred
Stock dividend obligations; and (ii) 711,199 shares of our common stock
issuable upon exercise of warrants issued in the private placement.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SECTION 8(a), MAY DETERMINE.
================================================================================
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES, AND IT IS NOT SOLICITING
OFFERS TO BUY THESE SECURITIES, IN ANY STATE WHERE THE OFFER OR SALE OF THESE
SECURITIES IS NOT PERMITTED.
PROSPECTUS
SUBJECT TO COMPLETION, DATED AUGUST 16, 2007
ELITE PHARMACEUTICALS INC.
COMMON STOCK
----------------------
This is an offering (the "OFFERING") of the following shares of common
stock, par value $.01 per share, of Elite Pharmaceuticals, Inc. (the "COMPANY",
"ELITE", "WE", "US" or "OUR"), by the selling stockholders named in this
prospectus or by pledgees, donees, transferees or other successors in interest
to the selling stockholders (the "SELLING STOCKHOLDERS"):
(i) 3,508,923 shares of common stock issuable upon conversion of
outstanding shares of our Series C Preferred Stock, par value $.01 per
share issued in a private placement that closed on July 17, 2007 and
shares of common stock issuable in satisfaction of certain Series C
Preferred Stock dividend obligations;
(ii) 711,199 shares of common stock issuable upon exercise of warrants
issued in the private placement;
The common stock is listed on the American Stock Exchange under the
symbol "ELI." On August 10, 2007, the closing sales price of our common stock on
the American Stock Exchange was $2.16 per share.
SEE "RISK FACTORS" BEGINNING ON PAGE 3 FOR A DISCUSSION OF FACTORS THAT
YOU SHOULD CONSIDER BEFORE BUYING SHARES OF OUR COMMON STOCK.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
Other than receipt of the cash exercise price upon exercise of the
warrants issued in the private placement, we will receive no proceeds from the
sale of the shares of common stock sold by the Selling Stockholders.
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The date of this prospectus is August___, 2007.
TABLE OF CONTENTS
Page
WHERE YOU CAN FIND MORE INFORMATION ABOUT US...................................1
PROSPECTUS SUMMARY.............................................................1
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION.....................2
RISK FACTORS...................................................................3
USE OF PROCEEDS...............................................................11
SELLING STOCKHOLDERS..........................................................12
PLAN OF DISTRIBUTION..........................................................16
LEGAL MATTERS.................................................................17
EXPERTS.......................................................................17
INCORPORATION BY REFERENCE....................................................18
INFORMATION NOT REQUIRED IN PROSPECTUS......................................II-1
SIGNATURES..................................................................II-4
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WHERE YOU CAN FIND MORE INFORMATION ABOUT US
We file reports, proxy statements, information statements and other
information with the Securities and Exchange Commission (the "SEC"). You may
read and copy this information, for a copying fee, at the SEC's Public Reference
Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330 for more information in its public reference rooms. Our SEC
filings are also available to the public from commercial document retrieval
services, from the American Stock Exchange and at the web site maintained by the
SEC at http://www.sec.gov.
We have not authorized anyone to give any information or make any
representation about the offering that differs from, or adds to, the information
in this prospectus or in our documents that are publicly filed with the SEC and
that are incorporated in this prospectus. Therefore, if anyone does give you
different or additional information, you should not rely on it. The delivery of
this prospectus does not mean that there have not been any changes in our
condition since the date of this prospectus. If you are in a jurisdiction where
it is unlawful to offer the securities offered by this prospectus, or if you are
a person to whom it is unlawful to direct such activities, then the offer
presented by this prospectus does not extend to you. This prospectus speaks only
as of its date except where it indicates that another date applies. Documents
that are incorporated by reference in this prospectus speak only as of their
date, except where they specify that other dates apply.
THIS PROSPECTUS IS NOT AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY NOR SHALL THERE BE ANY SALE OF SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR
QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS SUMMARY
THE FOLLOWING SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM, OR
INCORPORATED BY REFERENCE INTO, THIS PROSPECTUS AND MAY NOT CONTAIN ALL THE
INFORMATION THAT IS IMPORTANT TO YOU. TO UNDERSTAND OUR BUSINESS AND THIS
OFFERING FULLY, YOU SHOULD READ THIS ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE
CONSOLIDATED FINANCIAL STATEMENTS AND THE RELATED NOTES AND THE DOCUMENTS
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS. REFERENCES IN THIS PROSPECTUS TO
THE "COMPANY," "ELITE," "ELITE PHARMACEUTICALS," "WE," "OUR," AND "US" REFER TO
ELITE PHARMACEUTICALS, INC., A DELAWARE CORPORATION, TOGETHER WITH OUR
SUBSIDIARIES. PLEASE SEE "INCORPORATION BY REFERENCE" FOR A DESCRIPTION OF
PUBLIC FILINGS DEEMED INCORPORATED BY REFERENCE INTO THIS PROSPECTUS.
THE COMPANY
OVERVIEW
We are a specialty pharmaceutical company principally engaged in the
development and manufacture of oral, controlled release products. We develop
oral, controlled release products using proprietary technology and license these
products. Our strategy includes improving off-patent drug products for life
cycle management and developing generic versions of controlled release drug
products with high barriers to entry. Our technology is applicable to develop
delayed, sustained or targeted release pellets, capsules, tablets, granules and
powders.
We have two products, Lodrane 24(R) and Lodrane 24D(R), currently being
sold commercially, and a pipeline of seven drug candidates under development in
the therapeutic areas that include pain management, allergy and infection. Of
the products under development, ELI-216, an abuse deterrent oxycodone product
and ELI-154, a once daily oxycodone product are in clinical trials and we have
two generic product candidates that are undergoing pivotal studies. The
addressable market for our pipeline of products exceeds $6 billion. Our facility
in Northvale, New Jersey also is a Good Manufacturing Practice (GMP) and DEA
registered facility for research, development and manufacturing.
At the end of 2006, we formed, together with VGS Pharma, LLC, Novel
Laboratories, Inc. ("NOVEL"), a Delaware corporation as a separate specialty
pharmaceutical company for the research, development, manufacturing, licensing
and acquisition of specialty generic pharmaceuticals.
We believe that our business strategy enables us to reduce our risk by
having a
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diverse product portfolio that includes both branded and generic products in
various therapeutic categories and build collaborations and establish licensing
agreements with companies with greater resources thereby allowing us to share
costs of development and to improve cash-flow.
CORPORATE INFORMATION
Elite Pharmaceuticals, Inc. was incorporated on October 1,1997 under
the laws of Delaware, and our wholly-owned subsidiaries, Elite Laboratories,
Inc. ("ELITE LABS") and Elite Research, Inc. ("ELITE RESEARCH") were
incorporated on August 23, 1990 and December 20, 2002, respectively, under the
laws of Delaware.
On October 24, 1997, Elite Pharmaceuticals merged with and into our
predecessor company, Prologica International, Inc. ("PROLOGICA"), an inactive
publicly held corporation formed under the laws of Pennsylvania. At the same
time, Elite Labs merged with a wholly-owned subsidiary of Prologica. Following
these mergers, Elite Pharmaceuticals survived as the parent of its wholly-owned
subsidiary, Elite Labs.
On September 30, 2002, we acquired from Elan Corporation, plc and Elan
International Services, Ltd. (together "ELAN") Elan's 19.9% interest in Elite
Research, Ltd., a Bermuda corporation ("ERL"), a joint venture formed between
Elite and Elan in which our initial interest was 100% of the outstanding common
stock which represented 80.1% of the outstanding capital stock. As a result of
the termination of the joint venture, we owned 100% of ERL's capital stock. On
December 31, 2002, ERL was merged into Elite Research, our wholly-owned
subsidiary.
Our common stock is traded on the American Stock Exchange under the
symbol "ELI". The market for our stock has historically been characterized
generally by low volume and broad range of prices and volume volatility. We
cannot give any assurance that a stable trading market will develop for our
stock.
Our executive offices are located at 165 Ludlow Avenue, Northvale, New
Jersey 07647, Phone No.: (201) 750-2646; Facsimile No.: (201) 750-2755.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION
Certain information contained in or incorporated by reference into this
prospectus includes forward-looking statements (as defined in Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934)
that reflect our current views with respect to future events and financial
performance. Certain factors, such as unanticipated technological difficulties,
the volatile and competitive environment for drug delivery products and the
development of generic drug products, changes in domestic and foreign economic,
market and regulatory conditions, the inherent uncertainty of financial
estimates and projections, the degree of success, if any, in concluding business
partnerships or licenses with viable pharmaceutical companies, instabilities
arising from terrorist actions and responses thereto, and other considerations
described as "RISK FACTORS" in this prospectus could cause actual results to
differ materially from those in the forward-looking statements. When used in
this registration statement, statements that are not statements of current or
historical fact may be deemed to be forward-looking statements. Without limiting
the foregoing, the words "plan", "intend", "may," "will," "expect," "believe",
"could," "anticipate," "estimate," or "continue" or similar expressions or other
variations or comparable terminology are intended to identify such
forward-looking statements. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date hereof. Except
as required by law, we undertake no obligation to update any forward-looking
statements, whether as a result of new information, future events or otherwise.
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RISK FACTORS
IN ADDITION TO THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS,
INCLUDING THE OTHER DOCUMENTS INCORPORATED HEREIN BY REFERENCE AND REFERRED
BELOW, THE FOLLOWING RISK FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING
AN INVESTMENT IN US AND IN ANALYZING OUR FORWARD-LOOKING STATEMENTS.
RISKS RELATED TO OUR BUSINESS
WE HAVE A RELATIVELY LIMITED OPERATING HISTORY, WHICH MAKES IT DIFFICULT TO
EVALUATE OUR FUTURE PROSPECTS.
Although we have been in operation since 1990, we have a relatively
short operating history and limited financial data upon which you may evaluate
our business and prospects. In addition, our business model is likely to
continue to evolve as we attempt to expand our product offerings and our
presence in the generic pharmaceutical market. As a result, our potential for
future profitability must be considered in light of the risks, uncertainties,
expenses and difficulties frequently encountered by companies that are
attempting to move into new markets and continuing to innovate with new and
unproven technologies. Some of these risks relate to our potential inability to:
o develop new products;
o obtain regulatory approval of our products;
o manage our growth, control expenditures and align costs with
revenues;
o attract, retain and motivate qualified personnel; and
o respond to competitive developments.
If we do not effectively address the risks we face, our business model
may become unworkable and we may not achieve or sustain profitability or
successfully develop any products.
WE HAVE NOT BEEN PROFITABLE AND EXPECT FUTURE LOSSES.
To date, we have not been profitable, and since our inception in 1990,
we have not generated any significant revenues. We may never be profitable or,
if we become profitable, we may be unable to sustain profitability. We have
sustained losses in each year since our incorporation in 1990. We incurred net
losses of $11,803,512, $6,883,914, $5,906,890, $6,514,217 and $4,061,422, for
the years ended March 31, 2007, 2006, 2005, 2004 and 2003, respectively. We
expect to realize significant losses for the current year of operation and to
continue to incur losses until we are able to generate sufficient revenues to
support our operations and offset operating costs.
IF WE ARE UNABLE TO OBTAIN ADDITIONAL FINANCING NEEDED FOR THE EXPENDITURES FOR
THE DEVELOPMENT AND COMMERCIALIZATION OF OUR DRUG PRODUCTS, IT WOULD IMPAIR OUR
ABILITY TO CONTINUE TO MEET OUR BUSINESS OBJECTIVES.
We continue to require additional financing to ensure that we will be
able to meet our expenditures to develop and commercialize our products. In
particular, in order to maintain our investment in our joint venture in Novel,
we are required to make a substantial investment of up to an additional
$20,000,000. If we fail to meet this financing requirement, VGS, our co-venturer
in Novel, may exercise a purchase right that would result in significant
dilution of our interest in Novel.
We do not have committed external sources of funding and may not be
able to obtain any additional funding, especially if volatile market conditions
persist for biotechnology companies. We believe our existing cash resources,
including the gross proceeds of $20 million raised in the private placement of
our Series C Preferred Stock that closed on April 24, 2007 and July 17, 2007, is
sufficient to meet our cash requirements for the next six months.
Other possible sources of the required financing are income from
product sales or sales of market rights, distributions from Novel, income from
co-development or partnering arrangements and the cash exercise of warrants and
options that are currently outstanding. No
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representation can be made that we will be able to obtain such revenue or
additional financing or if obtained it will be on favorable terms, or at all. No
assurance can be given that any offering if undertaken will be successfully
concluded or that if concluded the proceeds will be material. Our inability to
obtain additional financing when needed would impair our ability to continue our
business.
If any future financing involves the further sale of our securities,
our then-existing stockholders' equity could be substantially diluted. On the
other hand, if we incurred debt, we would be subject to risks associated with
indebtedness, including the risk that interest rates might fluctuate and cash
flow would be insufficient to pay principal and interest on such indebtedness.
SUBSTANTIALLY ALL OF OUR PRODUCT CANDIDATES ARE AT AN EARLY STAGE OF DEVELOPMENT
AND ONLY A PORTION OF THESE ARE IN CLINICAL DEVELOPMENT.
Other than ELI-154 which is in Phase I clinical development and ELI-216
which is in Phase II clinical development, our five other product candidates are
still at an early stage of development. We do not have any products that are
commercially available other than Lodrane 24(R) and Lodrane 24D(R). We will need
to perform additional development work for all of our product candidates in our
pipeline before we can seek the regulatory approvals necessary to begin
commercial sales.
IF WE ARE UNABLE TO SATISFY REGULATORY REQUIREMENTS, WE MAY NOT BE ABLE TO
COMMERCIALIZE OUR PRODUCT CANDIDATES.
We need FDA approval prior to marketing our product candidates in the
United States of America. If we fail to obtain FDA approval to market our
product candidates, we will be unable to sell our product candidates in the
United States of America and we will not generate revenue from the sale of such
products.
This regulatory review and approval process, which includes evaluation
of preclinical studies and clinical trials of our product candidates is lengthy,
expensive and uncertain. To receive approval, we must, among other things,
demonstrate with substantial evidence from well-controlled clinical trials that
our product candidates are both safe and effective for each indication where
approval is sought. Satisfaction of these requirements typically takes several
years and the time needed to satisfy them may vary substantially, based on the
type, complexity and novelty of the pharmaceutical product. We cannot predict if
or when we might submit for regulatory approval any of our product candidates
currently under development. Any approvals we may obtain may not cover all of
the clinical indications for which we are seeking approval. Also, an approval
might contain significant limitations in the form of narrow indications,
warnings, precautions, or contra-indications with respect to conditions of use.
The FDA has substantial discretion in the approval process and may
either refuse to file our application for substantive review or may form the
opinion after review of our data that our application is insufficient to allow
approval of our product candidates. If the FDA does not file or approve our
application, it may require that we conduct additional clinical, preclinical or
manufacturing validation studies and submit that data before it will reconsider
our application. Depending on the extent of these or any other studies, approval
of any applications that we submit may be delayed by several years, or may
require us to expend more resources than we have available. It is also possible
that additional studies, if performed and completed, may not be considered
sufficient by the FDA to make our applications approvable. If any of these
outcomes occur, we may be forced to abandon our applications for approval, which
might cause us to cease operations.
We will also be subject to a wide variety of foreign regulations
governing the development, manufacture and marketing of our products. Whether or
not FDA approval has been obtained, approval of a product by the comparable
regulatory authorities of foreign countries must still be obtained prior to
manufacturing or marketing the product in those countries. The approval process
varies from country to country and the time needed to secure approval may be
longer or shorter than that required for FDA approval. We cannot assure you that
clinical trials conducted in one country will be accepted by other countries or
that approval in one country will result in approval in any other country.
BEFORE WE CAN OBTAIN REGULATORY APPROVAL, WE NEED TO SUCCESSFULLY COMPLETE
CLINICAL TRIALS, OUTCOMES OF WHICH ARE UNCERTAIN.
In order to obtain FDA approval to market a new drug product, we must
demonstrate proof of safety and effectiveness in humans. To meet these
requirements, we must conduct extensive preclinical testing and "adequate and
well-controlled" clinical trials. Conducting
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clinical trials is a lengthy, time consuming, and expensive process. Completion
of necessary clinical trials may take several years or more. Delays associated
with products for which we are directly conducting preclinical or clinical
trials may cause us to incur additional operating expenses. The commencement and
rate of completion of clinical trials may be delayed by many factors, including,
for example:
o ineffectiveness of our product candidate or perceptions by
physicians that the product candidate is not safe or effective
for a particular indication;
o inability to manufacture sufficient quantities of the product
candidate for use in clinical trials;
o delay or failure in obtaining approval of our clinical trial
protocols from the FDA or institutional review boards;
o slower than expected rate of patient recruitment and
enrollment;
o inability to adequately follow and monitor patients after
treatment;
o difficulty in managing multiple clinical sites;
o unforeseen safety issues;
o government or regulatory delays; and
o clinical trial costs that are greater than we currently
anticipate.
Even if we achieve positive interim results in clinical trials, these
results do not necessarily predict final results, and positive results in early
trials may not be indicative of success in later trials. A number of companies
in the pharmaceutical industry have suffered significant setbacks in advanced
clinical trials, even after promising results in earlier trials. Negative or
inconclusive results or adverse medical events during a clinical trial could
cause us to repeat or terminate a clinical trial or require us to conduct
additional trials. We do not know whether our existing or any future clinical
trials will demonstrate safety and efficacy sufficiently to result in marketable
products. Our clinical trials may be suspended at any time for a variety of
reasons, including if the FDA or we believe the patients participating in our
trials are exposed to unacceptable health risks or if the FDA finds deficiencies
in the conduct of these trials.
Failures or perceived failures in our clinical trials will directly
delay our product development and regulatory approval process, damage our
business prospects, make it difficult for us to establish collaboration and
partnership relationships, and negatively affect our reputation and competitive
position in the pharmaceutical community.
Because of these risks, our research and development efforts may not
result in any commercially viable products. Any delay in, or termination of, our
preclinical or clinical trials will delay the filing of our drug applications
with the FDA and, ultimately, our ability to commercialize our product
candidates and generate product revenues. If a significant portion of these
development efforts are not successfully completed, required regulatory
approvals are not obtained or any approved products are not commercially
successful, our business, financial condition, and results of operations may
be materially harmed.
IF OUR COLLABORATION OR LICENSE ARRANGEMENTS ARE UNSUCCESSFUL, OUR REVENUES AND
PRODUCT DEVELOPMENT MAY BE LIMITED.
We have entered into several collaboration and licensing arrangements
for the development of generic products. However, there can be no assurance that
any of these agreements will result in FDA approvals, or that we will be able to
market any such finished products at a profit. Collaboration and licensing
arrangements pose the following risks:
o collaborations and licensee arrangements may be terminated, in
which case we will experience increased operating expenses and
capital requirements if we elect to pursue further development
of the product candidate;
o collaborators and licensees may delay clinical trials and
prolong clinical development, under-fund a clinical trial
program, stop a clinical trial or abandon a product candidate;
5
o expected revenue might not be generated because milestones may
not be achieved and product candidates may not be developed;
o collaborators and licensees could independently develop, or
develop with third parties, products that could compete with
our future products;
o the terms of our contracts with current or future
collaborators and licensees may not be favorable to us in the
future;
o a collaborator or licensee with marketing and distribution
rights to one or more of our products may not commit enough
resources to the marketing and distribution of our products,
limiting our potential revenues from the commercialization of
a product;
o disputes may arise delaying or terminating the research,
development or commercialization of our product candidates, or
result in significant and costly litigation or arbitration;
and
o one or more third party developers could obtain approval for a
similar product prior to the collaborator or licensee
resulting in unforeseen price competition in connection with
the development product.
IF WE ARE UNABLE TO PROTECT OUR INTELLECTUAL PROPERTY RIGHTS AND AVOID CLAIMS
THAT WE INFRINGED ON THE INTELLECTUAL PROPERTY RIGHTS OF OTHERS, OUR ABILITY TO
CONDUCT BUSINESS MAY BE IMPAIRED.
Our success depends on our ability to protect our current and future
products and to defend our intellectual property rights. If we fail to protect
our intellectual property adequately, competitors may manufacture and market
products similar to ours.
We currently hold five patents, have two patents pending and we intend
to file further patent applications in the future. With respect to our pending
patents, we cannot be certain that these applications will result in the
issuance of patents. If patents are issued, third parties may sue us to
challenge such patent protection, and although we know of no reason why they
should prevail, it is possible that they could. It is likewise possible that our
patent rights may not prevent or limit our present and future competitors from
developing, using or commercializing products that are similar or functionally
equivalent to our products.
In addition, we may be required to obtain licenses to patents, or other
proprietary rights of third parties, in connection with the development and use
of our products and technologies as they relate to other persons' technologies.
At such time as we discover a need to obtain any such license, we will need to
establish whether we will be able to obtain such a license on favorable terms.
The failure to obtain the necessary licenses or other rights could preclude the
sale, manufacture or distribution of our products.
We rely particularly on trade secrets, unpatented proprietary expertise
and continuing innovation that we seek to protect, in part, by entering into
confidentiality agreements with licensees, suppliers, employees and consultants.
We cannot provide assurance that these agreements will not be breached or
circumvented. We also cannot be certain that there will be adequate remedies in
the event of a breach. Disputes may arise concerning the ownership of
intellectual property or the applicability of confidentiality agreements. We
cannot be sure that our trade secrets and proprietary technology will not
otherwise become known or be independently developed by our competitors or, if
patents are not issued with respect to products arising from research, that we
will be able to maintain the confidentiality of information relating to these
products. In addition, efforts to ensure our intellectual property rights can be
costly, time-consuming and/or ultimately unsuccessful.
LITIGATION IS COMMON IN OUR INDUSTRY, PARTICULARLY THE GENERIC PHARMACEUTICAL
INDUSTRY, AND CAN BE PROTRACTED AND EXPENSIVE AND COULD DELAY AND/OR PREVENT
ENTRY OF OUR PRODUCTS INTO THE MARKET, WHICH, IN TURN, COULD HAVE A MATERIAL
ADVERSE EFFECT ON OUR BUSINESS.
Litigation concerning patents and proprietary rights can be protracted
and expensive. Companies that produce brand pharmaceutical products routinely
bring litigation against applicants that seek FDA approval to manufacture and
market generic forms of their branded products. These companies allege patent
infringement or other violations of intellectual property rights as the basis
for filing suit against an applicant. Likewise, other patent holders may bring
patent infringement suits against us alleging that our products, product
candidates and technologies infringe upon intellectual property rights.
Litigation often
6
involves significant expense and can delay or prevent introduction or sale of
our products.
There may also be situations where we use our business judgment and
decide to market and sell products, notwithstanding the fact that allegations of
patent infringement(s) have not been finally resolved by the courts. The risk
involved in doing so can be substantial because the remedies available to the
owner of a patent for infringement include, among other things, damages measured
by the profits lost by the patent owner and not by the profits earned by the
infringer. In the case of a willful infringement, the definition of which is
subjective, such damages may be trebled. Moreover, because of the discount
pricing typically involved with bioequivalent products, patented brand products
generally realize a substantially higher profit margin than bioequivalent
products. An adverse decision in a case such as this or in other similar
litigation could have a material adverse effect on our business, financial
position and results of operations and could cause the market value of our
common stock to decline.
THE PHARMACEUTICAL INDUSTRY IS HIGHLY COMPETITIVE AND SUBJECT TO RAPID AND
SIGNIFICANT TECHNOLOGICAL CHANGE, WHICH COULD IMPAIR OUR ABILITY TO IMPLEMENT
OUR BUSINESS MODEL.
The pharmaceutical industry is highly competitive, and we may be unable
to compete effectively. In addition, it is undergoing rapid and significant
technological change, and we expect competition to intensify as technical
advances in each field are made and become more widely known. An increasing
number of pharmaceutical companies have been or are becoming interested in the
development and commercialization of products incorporating advanced or novel
drug delivery systems. We expect that competition in the field of drug delivery
will increase in the future as other specialized research and development
companies begin to concentrate on this aspect of the business. Some of the major
pharmaceutical companies have invested and are continuing to invest significant
resources in the development of their own drug delivery systems and technologies
and some have invested funds in such specialized drug delivery companies. Many
of our competitors have longer operating histories and greater financial,
research and development, marketing and other resources than we do. Such
companies may develop new formulations and products, or may improve existing
ones, more efficiently than we can. Our success, if any, will depend in part on
our ability to keep pace with the changing technology in the fields in which we
operate.
As we expand our presence in the generic pharmaceuticals market through
our joint venture, Novel, its product candidates may face intense competition
from brand-name companies that have taken aggressive steps to thwart competition
from generic companies. In particular, brand-name companies continue to sell or
license their products directly or through licensing arrangements or strategic
alliances with generic pharmaceutical companies (so-called "authorized
generics"). No significant regulatory approvals are required for a brand-name
company to sell directly or through a third party to the generic market, and
brand-name companies do not face any other significant barriers to entry into
such market. In addition, such companies continually seek to delay generic
introductions and to decrease the impact of generic competition, using tactics
which include:
o obtaining new patents on drugs whose original patent
protection is about to expire;
o filing patent applications that are more complex and costly to
challenge;
o filing suits for patent infringement that automatically delay
approval of the FDA;
o filing citizens' petitions with the FDA contesting approval of
the generic versions of products due to alleged health and
safety issues;
o developing controlled-release or other "next-generation"
products, which often reduce demand for the generic version of
the existing product for which we may be seeking approval;
o changing product claims and product labeling;
o developing and marketing as over-the-counter products those
branded products which are about to face generic competition;
and
o making arrangements with managed care companies and insurers
to reduce the economic incentives to purchase generic
pharmaceuticals.
These strategies may increase the costs and risks associated with our
efforts to introduce our generic products under development and may delay or
prevent such introduction
7
altogether.
IF OUR PRODUCT CANDIDATES DO NOT ACHIEVE MARKET ACCEPTANCE AMONG PHYSICIANS,
PATIENTS, HEALTH CARE PAYORS AND THE MEDICAL COMMUNITY, THEY WILL NOT BE
COMMERCIALLY SUCCESSFUL AND OUR BUSINESS WILL BE ADVERSELY AFFECTED.
The degree of market acceptance of any of our approved product
candidates among physicians, patients, health care payors and the medical
community will depend on a number of factors, including:
o acceptable evidence of safety and efficacy;
o relative convenience and ease of administration;
o the prevalence and severity of any adverse side effects;
o availability of alternative treatments;
o pricing and cost effectiveness;
o effectiveness of sales and marketing strategies; and
o ability to obtain sufficient third-party coverage or
reimbursement.
If we are unable to achieve market acceptance for our product
candidates, then such product candidates will not be commercially successful and
our business will be adversely affected.
WE ARE DEPENDENT ON A SMALL NUMBER OF SUPPLIERS FOR OUR RAW MATERIALS, AND ANY
DELAY OR UNAVAILABILITY OF RAW MATERIALS CAN MATERIALLY ADVERSELY AFFECT OUR
ABILITY TO PRODUCE PRODUCTS.
The FDA requires identification of raw material suppliers in
applications for approval of drug products. If raw materials were unavailable
from a specified supplier, FDA approval of a new supplier could delay the
manufacture of the drug involved. In addition, some materials used in our
products are currently available from only one supplier or a limited number of
suppliers.
Further, a significant portion of our raw materials may be available
only from foreign sources. Foreign sources can be subject to the special risks
of doing business abroad, including:
o greater possibility for disruption due to transportation or
communication problems;
o the relative instability of some foreign governments and
economies;
o interim price volatility based on labor unrest, materials or
equipment shortages, export duties, restrictions on the
transfer of funds, or fluctuations in currency exchange rates;
and
o uncertainty regarding recourse to a dependable legal system
for the enforcement of contracts and other rights.
In addition, recent changes in patent laws in certain foreign
jurisdictions (primarily in Europe) may make it increasingly difficult to obtain
raw materials for research and development prior to expiration of applicable
United States or foreign patents. Any delay or inability to obtain raw materials
on a timely basis, or any significant price increases that cannot be passed on
to customers, can materially adversely affect our ability to produce products.
This can materially adversely affect our business and operations.
EVEN AFTER REGULATORY APPROVAL, WE WILL BE SUBJECT TO ONGOING SIGNIFICANT
REGULATORY OBLIGATIONS AND OVERSIGHT.
Even if regulatory approval is obtained for a particular product
candidate, the FDA and foreign regulatory authorities may, nevertheless, impose
significant restrictions on the indicated uses or marketing of such products, or
impose ongoing requirements for post-approval studies. Following any regulatory
approval of our product candidates, we will be subject to continuing regulatory
obligations, such as safety reporting requirements, and additional
post-marketing obligations, including regulatory oversight of the promotion and
8
marketing of our products. If we become aware of previously unknown problems
with any of our product candidates here or overseas or our contract
manufacturers' facilities, a regulatory agency may impose restrictions on our
products, our contract manufacturers or on us, including requiring us to
reformulate our products, conduct additional clinical trials, make changes in
the labeling of our products, implement changes to or obtain re-approvals of our
contract manufacturers' facilities or withdraw the product from the market. In
addition, we may experience a significant drop in the sales of the affected
products, our reputation in the marketplace may suffer and we may become the
target of lawsuits, including class action suits. Moreover, if we fail to comply
with applicable regulatory requirements, we may be subject to fines, suspension
or withdrawal of regulatory approvals, product recalls, seizure of products,
operating restrictions and criminal prosecution. Any of these events could harm
or prevent sales of the affected products or could substantially increase the
costs and expenses of commercializing and marketing these products.
IF KEY PERSONNEL WERE TO LEAVE US OR IF WE ARE UNSUCCESSFUL IN ATTRACTING
QUALIFIED PERSONNEL, OUR ABILITY TO DEVELOP PRODUCTS COULD BE MATERIALLY HARMED.
Our success depends in large part on our ability to attract and retain
highly qualified scientific, technical and business personnel experienced in the
development, manufacture and marketing of oral, controlled release drug delivery
systems and generic products. Our business and financial results could be
materially harmed by the inability to attract or retain qualified personnel.
IF WE WERE SUED ON A PRODUCT LIABILITY CLAIM, AN AWARD COULD EXCEED OUR
INSURANCE COVERAGE AND COST US SIGNIFICANTLY.
The design, development and manufacture of our products involve an
inherent risk of product liability claims. We have procured product liability
insurance; however, a successful claim against us in excess of the policy limits
could be very expensive to us, damaging our financial position. The amount of
our insurance coverage, which has been limited due to our limited financial
resources, may be materially below the coverage maintained by many of the other
companies engaged in similar activities. To the best of our knowledge, no
product liability claim has been made against us as of June 30, 2007.
RISKS RELATED TO OUR COMMON STOCK
FUTURE SALES OF OUR COMMON STOCK COULD LOWER THE MARKET PRICE OF OUR COMMON
STOCK.
Sales of substantial amounts of our shares in the public market could
harm the market price of our common stock, even if our business is doing well. A
significant number of shares of our common stock are eligible for sale in the
public market under SEC Rule 144 subject in some cases to volume and other
limitations. In addition, we have recently filed a registration statement for
the resale of 6,465,504 shares of common stock issuable upon conversion of
outstanding shares of our Series C Preferred Stock issued in the private
placement that closed on April 24, 2007, 4,187,643 shares of common stock
issuable in satisfaction of certain Series C Preferred Stock dividend
obligations and 2,133,606 shares of common stock issuable upon exercise of
warrants issued in the private placement and a registration statement for the
resale of 957,396 shares of common stock and 478,698 shares of common stock
issuable upon the exercise of warrants issued to VGS Pharma, LLC, an affiliate
of Veerappan Subramanian, one of our directors and acting Chief Scientific
Officer and 1,750,000 shares of common stock issuable upon the exercise of
options granted to Dr. Subramanian.
In addition, pursuant hereto, we are registering the resale of:
o 3,508,923 shares of common stock issuable upon conversion of
outstanding shares of our Series C Preferred Stock issued in
the private placement that closed on July 17, 2007 and shares
of common stock issuable in satisfaction of certain Series C
Preferred Stock dividend obligations; and
o 711,199 shares of common stock issuable upon exercise of
warrants issued in the private placement.
Due to the foregoing factors, sales of a substantial number of shares
of our common stock in the public market could occur at any time. These sales,
or the perception in the market that the holders of a large number of shares
intend to sell shares, could reduce the market price of our common stock.
OUR STOCK PRICE HAS BEEN VOLATILE AND MAY FLUCTUATE IN THE FUTURE.
9
There has been significant volatility in the market prices for publicly
traded shares of pharmaceutical companies, including ours. For the twelve months
ended August 10, 2007, the closing sale price on the American Stock Exchange of
our common stock fluctuated from a high of $2.77 per share to a low of $1.80 per
share. The per share price of our common stock may not remain at or exceed
current levels. The market price for our common stock, and for the stock of
pharmaceutical companies generally, has been highly volatile. The market price
of our common stock may be affected by:
o Results of our clinical trials;
o Approval or disapproval of abbreviated new drug applications
or new drug applications;
o Announcements of innovations, new products or new patents by
us or by our competitors;
o Governmental regulation;
o Patent or proprietary rights developments;
o Proxy contests or litigation;
o News regarding the efficacy of, safety of or demand for drugs
or drug technologies;
o Economic and market conditions, generally and related to the
pharmaceutical industry;
o Healthcare legislation;
o Changes in third-party reimbursement policies for drugs; and
o Fluctuations in our operating results.
THE FAILURE TO MAINTAIN THE AMERICAN STOCK EXCHANGE LISTING OF THE COMMON STOCK
WOULD HAVE A MATERIAL ADVERSE EFFECT ON THE MARKET FOR OUR COMMON STOCK AND OUR
MARKET PRICE.
On January 4, 2006, we received a letter from the American Stock
Exchange ("AMEX") notifying us that, based on our unaudited financial statements
as of September 30, 2005, we were not in compliance with the continued listing
standards set forth in the AMEX Company Guide in that under one listing standard
our shareholders' equity is less than $4,000,000 and we had losses from
continuing operations and/or net losses in three of our four most recent fiscal
years and under another listing standard our shareholders' equity is less than
$6,000,000 and we had losses from continuing operations and/or net losses in our
five most recent fiscal years. At the request of AMEX, we submitted a plan on
February 3, 2006 advising AMEX of action, we had taken, and will take, to bring
ourselves in compliance with the continued listing standards within a maximum of
18 months from January 4, 2006. On March 15, 2006, we completed a private
placement of our Series B Preferred Stock and warrants to purchase common stock.
We received $10,000,000 in gross proceeds from the private placement. On March
21, 2006, we submitted an update to the plan we had previously submitted on
February 6, 2006. Upon notice of the March 2006 private placement and the
acceptance of the updated plan. AMEX allowed us to maintain our AMEX listing,
subject to periodic review of the our progress by the AMEX staff. If we are not
in compliance with the continued listing standards, AMEX may then initiate
delisting proceedings. The failure to maintain listing of our common stock on
AMEX will have an adverse effect on the market and the market price for our
common stock.
THE ISSUANCE OF ADDITIONAL SHARES OF OUR COMMON STOCK OR OUR PREFERRED STOCK
COULD MAKE A CHANGE OF CONTROL MORE DIFFICULT TO ACHIEVE.
The issuance of additional shares of our common stock or the issuance
of shares of an additional series of preferred stock could be used to make a
change of control of us more difficult and expensive. Under certain
circumstances, such shares could be used to create impediments to or frustrate
persons seeking to cause a takeover or to gain control of us. Such shares could
be sold to purchasers who might side with the Board in opposing a takeover bid
that the Board determines not to be in the best interests of our stockholders.
It might also have the effect of discouraging an attempt by another person or
entity through the acquisition of a substantial number of shares of our common
stock to acquire control of us with a view to consummating a merger, sale of all
or part of our assets, or a similar
10
transaction, since the issuance of new shares could be used to dilute the stock
ownership of such person or entity.
IF PENNY STOCK REGULATIONS BECOME APPLICABLE TO OUR COMMON STOCK THEY WILL
IMPOSE RESTRICTIONS ON THE MARKETABILITY OF OUR COMMON STOCK AND THE ABILITY OF
OUR STOCKHOLDERS TO SELL SHARES OF OUR STOCK COULD BE IMPAIRED.
The SEC has adopted regulations that generally define a "penny stock"
to be an equity security that has a market price of less than $5.00 per share or
an exercise price of less than $5.00 per share subject to certain exceptions.
Exceptions include equity securities issued by an issuer that has (i) net
tangible assets of at least $2,000,000, if such issuer has been in continuous
operation for more than three years, or (ii) net tangible assets of at least
$5,000,000, if such issuer has been in continuous operation for less than three
years, or (iii) average revenue of at least $6,000,000 for the preceding three
years. Unless an exception is available, the regulations require that prior to
any transaction involving a penny stock, a risk of disclosure schedule must be
delivered to the buyer explaining the penny stock market and its risks. Our
common stock is currently trading at under $5.00 per share. Although we
currently fall under one of the exceptions, if at a later time we fail to meet
one of the exceptions, our common stock will be considered a penny stock. As
such the market liquidity for our common stock will be limited to the ability of
broker-dealers to sell it in compliance with the above-mentioned disclosure
requirements.
You should be aware that, according to the SEC, the market for penny
stocks has suffered in recent years from patterns of fraud and abuse. Such
patterns include:
o Control of the market for the security by one or a few
broker-dealers;
o "Boiler room" practices involving high-pressure sales tactics;
o Manipulation of prices through prearranged matching of
purchases and sales;
o The release of misleading information;
o Excessive and undisclosed bid-ask differentials and markups by
selling broker- dealers; and
o Dumping of securities by broker-dealers after prices have been
manipulated to a desired level, which hurts the price of the
stock and causes investors to suffer loss.
We are aware of the abuses that have occurred in the penny stock
market. Although we do not expect to be in a position to dictate the behavior of
the market or of broker-dealers who participate in the market, we will strive
within the confines of practical limitations to prevent such abuses with respect
to our common stock.
SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW MAY DETER A THIRD PARTY FROM
ACQUIRING US.
Section 203 of the Delaware General Corporation Law prohibits a merger
with a 15% shareholder within three years of the date such shareholder acquired
15%, unless the merger meets one of several exceptions. The exceptions include,
for example, approval by the holders of two-thirds of the outstanding shares
(not counting the 15% shareholder), or approval by the Board prior to the 15%
shareholder acquiring its 15% ownership. This provision makes it difficult for a
potential acquirer to force a merger with or takeover of us, and could thus
limit the price that certain investors might be willing to pay in the future for
shares of our common stock.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of shares by the
Selling Stockholders pursuant to this prospectus.
A portion of the shares covered by this prospectus are issuable upon
exercise of warrants to purchase our common stock. Upon any exercise of the
warrants for cash, the Selling Stockholders would pay us the exercise price of
the warrants, as applicable. Under certain conditions set forth in the warrants,
the warrants are exercisable on a cashless basis. If the warrants are exercised
on a cashless basis, we would not receive any cash payment from the Selling
Stockholder upon any exercise of the warrants. Any proceeds from the exercise of
the warrants will be used for working capital.
11
SELLING STOCKHOLDERS
On July 17, 2007 we issued 5,000 shares of Series C Preferred Stock
convertible into 2,155,167 shares of our common stock and warrants to purchase
711,199 shares of our common stock in a private placement. Pursuant to the
registration rights agreement related to such private placement, we agreed to
file, at our expense, a registration statement, of which this prospectus is a
part, with the SEC to register for resale, from time to time, the 2,155,167
shares of our common stock issuable upon conversion of the shares of Series C
Preferred Stock, 1,353,756 shares of our common stock issuable in satisfaction
of certain Series C Preferred Stock dividend obligations, and 711,199 shares of
our common stock issuable upon exercise of the warrants issued in the private
placement.
We are registering the shares to permit the Selling Stockholders to
offer these shares for resale from time to time. The Selling Stockholders may
sell all, some or none of the shares covered by this prospectus. For more
information, see the section of this prospectus entitled "PLAN OF DISTRIBUTION."
The table below presents information as of July 17, 2007, regarding the
Selling Stockholders and the shares of our common stock that they may offer and
sell from time to time under this prospectus. The information is based on
information provided by or on behalf of the Selling Stockholders. Except as
noted in the footnotes, no Selling Stockholder has had, within the past three
years, any position, office, or material relationship with us or any of our
predecessors or affiliates. The table has been prepared on the assumption that
all shares offered under this prospectus will be sold to parties unaffiliated
with the Selling Stockholders. Except as indicated below the Selling
Stockholders have sole voting and investment power with their respective shares.
SHARES BENEFICIALLY OWNED
AFTER OFFERING
NAME OF SELLING NUMBER OF NUMBER OF NUMBER OF PERCENTAGE
STOCKHOLDER(1) SHARES SHARES OFFERED SHARES(2) OF CLASS(3)
BENEFICIALLY
OWNED PRIOR TO
OFFERING
M.H. Davidson &
Co.** 24,307(4) 5,816(5) 18,491 *
Davidson Kempner
Healthcare Fund
LP** 1,477,605(6) 323,295(7) 1,154,310 5.1%
Davidson Kempner
Healthcare
International
Ltd.** 2,172,148(8) 472,063(9) 1,700,085 7.4%
Serena Limited** 13,696(10) 2,490(11) 11,206 *
Davidson Kempner
International,
Ltd.** 599,300(12) 147,103(13) 452,197 2.1%
Davidson Kempner
Institutional
Partners, L.P.** 340,864(14) 83,107(15) 257,757 1.2%
Davidson Kempner
Partners** 188,305(16) 46,539(17) 141,766 *
Capital Ventures
International+ 1,308,331(18) 747,987(19) 560,344 2.6%
12
CAMHZN Master LDC 332,436(20) 332,436(20) 0 0
CAMOFI Master LDC 975,892(21) 415,548(22) 560,344 2.6%
Consonance Capital
Master Account LP 724,717(23) 724,717(23) 0 0
Midsummer
Investment LTD 2,640,431(24) 831,098(25) 1,809,333 7.8%
Sphera Global
Healthcare Master
Fund 251,593(26) 23,268(27) 228,325 1.1%
Oppenheimer & Co.,
Inc. 232,729(28) 48,491(29) 184,238 *
Ledgemont Capital
Group LLC+ 588,457(30) 16,164(29) 572,293 2.6%
* Less than 1%
** Messrs Thomas L. Kempner, Jr., Marvin H. Davidson, Stephen M. Dowicz,
Scott E. Davidson, Michael J. Leffell, Timothy I. Levart, Robert H.
Brivio, Jr., Anthony A. Yoseloff, Eric P. Epstein and Avram Z Friedman
(collectively, the "PRINCIPALS"), are the general partners of M. H.
Davidson & Co. and MHD Management Co. ("MHD"), the general partner of
Davidson Kempner Partners, the sole managing members of Davidson
Kempner International Advisors, L.L.C. ("DKIA"), the investment manager
of each of Davidson Kempner International, Ltd. and Serena Limited, the
sole stockholders of Davidson Kempner Advisers Inc. ("DKAI"), the
general partner of Davidson Kempner Institutional Partners, L.P., the
managing members of DK Group LLC ("DKG"), the general partner of
Davidson Kempner Healthcare Fund LP, and the limited partners of DK
Management Partners LP ("DKMP"), the investment manager of Davidson
Kempner Healthcare International Ltd. Each of the Principals, MHD,
DKIA, DKAI, DKG and DKMP disclaim all beneficial ownership as
affiliates of a registered investment adviser, and, in any case
disclaim all beneficial ownership except as to the extent of their
pecuniary interest in the shares.
+ The Selling Stockholder has identified itself as an affiliate of a
registered broker-dealer. The Selling Stockholder has represented to us
that it purchased the shares in the ordinary course of its business
and, at the time of purchase, had no agreements or understandings,
directly or indirectly, with any person to distribute the shares.
(1) Selling Stockholders means the persons listed in the table above, as
well as the pledgees, assignees or other successors in interest to the
selling stockholders.
(2) Assumes that the Selling Stockholders dispose of all the shares of
common stock covered by this prospectus and do not acquire or dispose
of any additional shares of common stock. The Selling Stockholders are
not representing, however, that any of the shares covered by this
prospectus will be offered for sale, and the Selling Stockholders
reserve the right to accept or reject, in whole or in part, any
proposed sale of shares.
(3) The percentage of common stock beneficially owned is based on
21,299,667 shares of common stock (excluding 100,000 treasury shares)
outstanding on July 17, 2007. Notwithstanding the inclusion of the
warrants and Series B and Series C Preferred Stock beneficially owned
by the referenced investors in the beneficial ownership calculation,
the warrants and Series B and Series C Preferred Stock provide that the
holder of the warrants and Series B and Series C Preferred Stock, as
applicable, shall not have the right to exercise any portion of the
warrants and Series B and Series C Preferred Stock, respectively, and
we shall not effect any exercise of such warrants and Series B and
Series C Preferred Stock, as applicable, to the extent that after
giving effect to such issuance after exercise such holder of the
warrants and Series B and Series C Preferred Stock, as applicable,
together with his, her or its affiliates, would beneficially own in
excess of 4.99% of the number of shares of common stock outstanding
immediately after giving effect to such issuance. Such 4.99% limitation
may be waived by each holder upon not less than 61 days prior notice to
change such limitation to 9.99% of the number of shares of common stock
outstanding immediately after giving effect to such issuance.
(4) Consists of 17,241 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 1,894 dividend shares and 5,172
shares of common stock issuable upon exercise of warrants. Does not
include any shares of common stock issuable in satisfaction of certain
Series C Preferred Stock dividend obligations from the April 24, 2007
private placement.
(5) Consists of 3,017 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 1,894 dividend shares and 905
shares of common stock issuable upon exercise of warrants.
13
(6) Consists of 1,055,603 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 105,322 dividend shares and
316,680 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement.
(7) Consists of 167,672 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 105,322 dividend shares and
50,301 shares of common stock issuable upon exercise of warrants.
(8) Consists of 1,552,585 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 153,788 dividend shares and
465,775 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement.
(9) Consists of 244,827 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 153,788 dividend shares and
73,448 shares of common stock issuable upon exercise of warrants.
(10) Consists of 9,913 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 810 dividend shares and 2,973
shares of common stock issuable upon exercise of warrants. Does not
include any shares of common stock issuable in satisfaction of certain
Series C Preferred Stock dividend obligations from the April 24, 2007
private placement.
(11) Consists of 1,293 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 810 dividend shares and 387
shares of common stock issuable upon exercise of warrants.
(12) Consists of 424,137 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 47,923 dividend shares and
127,240 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement.
(13) Consists of 76,293 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 47,923 dividend shares and
22,887 shares of common stock issuable upon exercise of warrants.
(14) Consists of 241,378 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 27,074 dividend shares and
72,412 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement.
(15) Consists of 43,103 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 27,074 dividend shares and
12,930 shares of common stock issuable upon exercise of warrants.
(16) Consists of 133,188 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 15,161 dividend shares and
39,956 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement.
(17) Consists of 24,137 shares of common stock issuable upon conversion of
shares of Series C Preferred Stock, 15,161 dividend shares and 7,241
shares of common stock issuable upon exercise of warrants.
(18) Consists of 818,965 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 243,677 dividend shares and
245,689 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement. Heights Capital Management, Inc., the
authorized agent of Capital Ventures International ("CVI"), has
discretionary authority to vote and dispose of the shares held by CVI
and may be deemed to be the beneficial owner of these shares. Martin
Kobinger, Investment Manager of Heights Capital Management, Inc. may
also be deemed to have investment discretion and voting power over the
shares held
14
by CVI. Mr. Kobinger disclaims any beneficial ownership of such shares
and warrants, except to the extent of any pecuniary interest therein.
(19) Consists of 387,931 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 243,677 dividend shares and
116,379 shares of common stock issuable upon exercise of warrants.
(20) Consists of 172,413 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 108,300 dividend shares and
51,723 shares of common stock issuable upon exercise of warrants. Mr.
Richard Smithine has the power to vote or dispose of the shares.
(21) Consists of 646,551 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 135,376 dividend shares and
193,965 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series C Preferred Stock dividend obligations from the April
24, 2007 private placement. Mr. Richard Smithine has the power to vote
or dispose of the shares.
(22) Consists of 215,517 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 135,376 dividend shares and
64,655 shares of common stock issuable upon exercise of warrants.
(23) Consists of 375,862 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 236,097 dividend shares and
112,758 shares of common stock issuable upon exercise of warrants. Mr.
Mitchell J. Blutt has the power to vote or dispose of the shares.
(24) Consists of 1,612,367 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 270,754 dividend shares and
757,310 shares of common stock issuable upon exercise of warrants. Does
not include any shares of common stock issuable in satisfaction of
certain Series B Preferred Stock dividend obligations from the March
15, 2006 private placement. Midsummer Capital, LLC is the investment
manager to Midsummer Investment Ltd. By virtue of such relationship,
Midsummer Capital, LLC may be deemed to have dispositive power over the
shares owned by Midsummer Investment Ltd. Midsummer Capital, LLC
disclaims beneficial ownership of such shares. Mr. Michel Amsalem and
Mr. Scott Kaufman have delegated authority from the members of
Midsummer Capital, LLC with respect to the shares of common stock owned
by Midsummer Investment Ltd. Messrs Amsalem and Kaufman may be deemed
to share dispositive power over the shares of our common stock owned by
Midsummer Investment Ltd. Messrs. Amsalem and Kaufman disclaim
beneficial ownership of such shares of our common stock and neither
person has any legal right to maintain such delegated authority.
(25) Consists of 431,034 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 270,754 dividend shares and
129,310 shares of common stock issuable upon exercise of warrants.
(26) Consists of 32,205 shares of common stock, 162,930 shares of common
stock issuable upon conversion of shares of Series C Preferred Stock,
7,580 dividend shares and 48,878 shares of common stock issuable upon
exercise of warrants. Does not include any shares of common stock
issuable in satisfaction of certain Series C Preferred Stock dividend
obligations from the April 24, 2007 private placement. Mr. Doron Breen
has the power to vote or dispose of the shares.
(27) Consists of 12,068 shares of common stock issuable upon conversion
of shares of Series C Preferred Stock, 7,580 dividend shares and 3,620
shares of common stock issuable upon exercise of warrants.
(28) Consists of 50,240 shares of common stock and 182,489 shares of common
stock issuable upon exercise of warrants. Oppenheimer & Co. Inc. is a
broker-dealer who acquired warrants to purchase 48,491 shares of our
common stock as compensation for serving as our placement agent in the
private placement.
(29) Consists of shares of common stock issuable upon exercise of warrants.
(30) Consists of shares of common stock issuable upon exercise of warrants.
Ledgemont Capital Group LLC ("Ledgemont") was assigned these shares by
Indigo Securities LLC ("Indigo"). Indigo acquired warrants to purchase
16,164 shares of our common stock for serving as a selected dealer to
our placement agent in the private placement. Mr. Edward Neugeboren, a
former member of our Board of Directors is a consultant of Indigo
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and managing director of Ledgemont.
PLAN OF DISTRIBUTION
OFFER AND SALE OF SHARES
Each Selling Stockholder has or its pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of common stock on the American Stock Exchange or any other stock exchange,
market or trading facility on which the shares are traded or in private
transactions. These sales may be at fixed or negotiated prices. A Selling
Stockholder may use any one or more of the following methods when selling
shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell
the shares as agent but may position and resell a portion of
the block as principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o broker-dealers may agree with the Selling Stockholders to sell
a specified number of such shares at a stipulated price per
share;
o through the writing or settlement of options or other hedging
transactions, whether through an options exchange or
otherwise;
o a combination of any such methods of sale; or
o any other method permitted pursuant to applicable law.
The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), if available, rather
than under this prospectus.
In connection with sales of the shares of common stock or otherwise,
the Selling Stockholders may enter into hedging transactions with
broker-dealers, which may in turn engage in short sales of the shares of common
stock in the course of hedging in positions they assume. The Selling
Stockholders may also sell shares of common stock short and deliver shares of
common stock covered by this prospectus to close out short positions and to
return borrowed shares in connection with such short sales. The Selling
Stockholders may also loan or pledge shares of common stock to broker-dealers
that in turn may sell such shares.
The Selling Stockholders may pledge or grant a security interest in
some or all of the warrants or shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock from time to time pursuant
to this prospectus or any amendment to this prospectus under Rule 424(b)(3) or
other applicable provision of the Securities Act of 1933, as amended, amending,
if necessary, the list of selling stockholders to include the pledgee,
transferee or other successors in interest as selling stockholders under this
prospectus. The Selling Stockholders also may transfer and donate the shares of
common stock in other
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circumstances in which case the transferees, donees, pledgees or other
successors in interest will be the selling beneficial owners.
Broker-dealers engaged by the Selling Stockholders may arrange for
other brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Stockholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NASDR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.
The Selling Stockholders and any broker-dealers or agents involved in
selling the shares may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed us
that it does not have any written or oral agreement or understanding, directly
or indirectly, with any person to distribute the common stock. In no event shall
any broker-dealer receive fees, commissions and markups which, in the aggregate,
would exceed eight percent (8%).
We are required to pay certain fees and expenses incurred by us
incident to the registration of the shares. We have agreed to indemnify the
Selling Stockholders against certain losses, claims, damages and liabilities,
including liabilities under the Securities Act.
Because Selling Stockholders may be deemed to be "underwriters" within
the meaning of the Securities Act, they will be subject to the prospectus
delivery requirements of the Securities Act including Rule 172 thereunder. In
addition, any securities covered by this prospectus which qualify for sale
pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather
than under this prospectus. There is no underwriter or coordinating broker
acting in connection with the proposed sale of the resale shares by the Selling
Stockholders.
We agreed to keep this prospectus effective until the earlier of (i)
the date on which the shares may be sold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(k) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to this prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The shares will be sold only
through registered or licensed brokers or dealers if required under applicable
state securities laws. In addition, in certain states, the shares may not be
sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is
available and is complied with.
Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the shares may not simultaneously engage
in market making activities with respect to the common stock for the applicable
restricted period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale (including by
compliance with Rule 172 under the Securities Act).
LEGAL MATTERS
Reitler Brown & Rosenblatt LLC, New York, New York, as our counsel will
pass upon whether the shares of common stock which are being registered under
the Securities Act of 1933, as amended, by the registration statement of which
this prospectus is a part are fully paid, nonassessable and validly issued.
EXPERTS
Miller, Ellin & Company, LLP, independent certified public accountants,
has audited our consolidated financial statements included in our Annual Report
on Form 10-K for the year ended March 31, 2007 as set forth in their reports,
which are incorporated by reference in this prospectus and elsewhere in the
registration statement. Our financial statements are
17
incorporated by reference in reliance on Miller Ellin's report, given on their
authority as experts in accounting and auditing.
INCORPORATION BY REFERENCE
The Securities and Exchange Commission (the "COMMISSION") allows us to
incorporate by reference the information that we file with it, which means that
we can disclose important information to you by referring you to those
documents. The information incorporated by reference into this registration
statement is considered to be part of this registration statement, and
information that we file later with the Commission will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future filings (including those filed by us prior to the
termination of the offering) we make with the Commission under Sections 13(a),
13(c), 14, or 15(d) of the Exchange Act:
a. our annual report on Form 10-K for the year ended March 31,
2007, filed with the Commission on June 28, 2007;
b. our quarterly report on Form 10-Q for the quarter ended June
30, 2007, filed with the Commission on August 10, 2007;
c. our current report on Form 8-K dated July 23, 2007, filed
with the Commission on July 23, 2007;
d. the description of our capital stock which is contained in our
registration statement on Form 8-A filed on February 16, 2000
including any subsequent amendments and reports filed for the
purpose of updating that description.
You may request a copy of these filings, at no cost, by written or oral
request to us at the following address:
Mark I. Gittelman
Corporate Secretary
Elite Pharmaceuticals, Inc.
165 Ludlow Avenue
Northvale, New Jersey 07647
(201) 750-2646
No person has been authorized to give any information or to make any
representation other than those contained in this prospectus in connection with
the offering of the shares of our common stock by the Selling Stockholders. If
information or representations other than those contained in this prospectus are
given or made, you must not rely on it as if we authorized it. Neither the
delivery of this prospectus nor any sale made hereunder shall, under any
circumstances, create an implication that the information contained or
incorporated by reference herein is correct as of any time subsequent to its
date or that there has been no change in our affairs since such date. This
prospectus does not constitute an offer to sell or a solicitation of an offer to
buy any securities offered hereby in any jurisdiction in which such offer or
solicitation is not permitted, or to anyone whom it is unlawful to make such
offer or solicitation. The information in this prospectus is not complete and
may be changed.
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4,220,122 SHARES
ELITE PHARMACEUTICALS, INC.
COMMON STOCK
----------------------------
PROSPECTUS
[____________], 2007
----------------------------
Until [__________], 2007, all dealers that buy, sell, or trade the common
stock, may be required to deliver a prospectus, regardless of whether they are
participating in this offering. This is in addition to the dealers' obligation
to deliver a prospectus when acting as underwriters and with respect to their
unsold allotments or subscriptions.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is a statement of the estimated expenses incurred by us
in connection with the distribution of the securities registered under this
registration statement:
AMOUNT
TO BE PAID *
----------
SEC Registration Fee ........... $ 282.44
Legal Fees and Expenses ........ $10,000.00*
Accounting Fees and Expenses ... $ 1,000.00*
Printing Expenses .............. $ 2,000.00*
Miscellaneous .................. $ 2,000.00*
----------
Total .......................... $15,282.44*
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to authority conferred by Section 102 of the Delaware General
Corporation Law (the "DGCL"), our Certificate of Incorporation, as amended,
contains a provision providing that the personal liability of a director is
eliminated to the fullest extent provided by the DGCL. The effect of this
provision is that none of our directors is personally liable to us or our
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability for (i) any breach of the director's duty of loyalty to us
or our stockholders, (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) unlawful payment of
dividends as provided in Section 174 of the DGCL and (iv) any transaction from
which the director derived an improper personal benefit. This provision is
intended to eliminate the risk that a director might incur personal liability to
us or our stockholders for breach of duty of care. The Certificate of
Incorporation, as amended, also provides that if the Delaware Law is amended to
eliminate or limit further the liability of directors, then the liability of our
directors shall be eliminated or limited, without further stockholder action.
Section 145 of the DGCL contains provisions permitting and, in some
situations, requiring Delaware corporations, such as Elite, to provide
indemnification to their officers and directors for losses and litigation
expenses incurred in connection with their service to the corporation in those
capacities. Our Certificate of Incorporation, as amended, and by-laws contain
such a provision requiring that we indemnify our directors and officers to the
fullest extent permitted by law, as the law may be amended from time to time.
In our registration rights agreement with each of the Selling
Stockholders, we have agreed to indemnify the purchaser against damages or
losses and expenses arising from any losses or expenses incurred in connection
with a loss or alleged loss arising from a material misstatement in or a
material omission from the registration statement or any violation of the
Securities Act except for a material misstatement or omission based on written
information provided to us by the purchaser.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions or otherwise, it has been advised that, in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable.
ITEM 16. EXHIBITS
4.1 Form of Common Stock certificate, incorporated by reference to Exhibit
4.1 to the Registration Statement on Form SB-2, Registration No.
333-90633, made effective on February 28, 2000.
5.1 Opinion of Reitler Brown & Rosenblatt LLC.
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10.1 Form of Securities Purchase Agreement between the Registrant and
purchasers listed as signatories thereto, incorporated by reference to
Exhibit 10.1 to the Current Report on Form 8-K dated July 23, 2007 and
filed with the Commission on July 23, 2007.
10.2 Form of Registration Rights Agreement between the Registrant and
purchasers listed as signatories thereto, incorporated by reference to
Exhibit 10.2 to the Current Report on Form 8-K dated July 23, 2007 and
filed with the Commission on July 23, 2007.
10.3 Placement Agent Agreement between Oppenheimer & Co., Inc. and the
Registrant, incorporated by reference to Exhibit 10.3 to the Current
Report on Form 8-K dated April 25, 2007 and filed with the Commission
on April 25, 2007.
10.4 Form of Common Stock Purchase Warrant, incorporated by reference to
Exhibit 4.2 to Elite's Current Report on Form 8-K dated April 25, 2007
and filed with the Commission on April 25, 2007.
10.5 Form of Common Stock Purchase Warrant issued to the Placement Agent,
incorporated by reference to Exhibit 4.3 to the Current Report on Form
8-K dated April 25, 2007 and filed with the Commission on April 25,
2007.
23.1 Consent of Miller, Ellin & Company LLP.
23.2 Consent of Reitler Brown & Rosenblatt LLC (included in Exhibit 5.1
above).
24.1 Power of Attorney (included on Signature page).
---------------
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement;
notwithstanding the foregoing, any increase or decrease in amount of securities
offered (if the total dollar value of the securities offered would not exceed
that which was registered) may be reflected in the form of prospectus filed with
the Securities and Exchange Commission pursuant to Rule 424(b) if the change in
volume represents no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement; provided,
however, that paragraphs (a)(1)(i), (ii) and (iii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Securities and Exchange Commission by the Registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such
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securities at that time shall be deemed to be the initial bona fide offering
thereof.
(b) INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE
SECURITIES ACT OF 1933 MAY BE PERMITTED TO DIRECTORS, OFFICERS AND CONTROLLING
PERSONS OF THE REGISTRANT PURSUANT TO THE FOREGOING PROVISIONS, OR OTHERWISE,
THE REGISTRANT HAS BEEN ADVISED THAT IN THE OPINION OF THE SECURITIES AND
EXCHANGE COMMISSION SUCH INDEMNIFICATION IS AGAINST PUBLIC POLICY AS EXPRESSED
IN THE SECURITIES ACT OF 1933 AND IS, THEREFORE, UNENFORCEABLE. IN THE EVENT
THAT A CLAIM FOR INDEMNIFICATION AGAINST SUCH LIABILITIES (OTHER THAN THE
PAYMENT BY THE REGISTRANT OF EXPENSES INCURRED OR PAID BY A DIRECTOR, OFFICER OR
CONTROLLING PERSON OF THE REGISTRANT IN THE SUCCESSFUL DEFENSE OF ANY ACTION,
SUIT OR PROCEEDING) IS ASSERTED AGAINST THE REGISTRANT BY SUCH DIRECTOR, OFFICER
OR CONTROLLING PERSON IN CONNECTION WITH THE SECURITIES BEING REGISTERED, THE
REGISTRANT WILL, UNLESS IN THE OPINION OF ITS COUNSEL THE MATTER HAS BEEN
SETTLED BY CONTROLLING PRECEDENT, SUBMIT TO A COURT OF APPROPRIATE JURISDICTION
THE QUESTION WHETHER SUCH INDEMNIFICATION BY IT IS AGAINST PUBLIC POLICY AS
EXPRESSED IN THE SECURITIES ACT OF 1933 AND WILL BE GOVERNED BY THE FINAL
ADJUDICATION OF SUCH ISSUE.
(c)(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act of 1933 shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the Borough of
Northvale, State of New Jersey, on August 16, 2007.
ELITE PHARMACEUTICALS, INC.
/s/ Bernard Berk
--------------------------------------------
Bernard Berk
President and Chief Executive Officer
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KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Bernard Berk and Mark I. Gittelman as his
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place, and stead, in any and all capacities, to sign
and file Registration Statement(s) and any and all pre- or post-effective
amendments to such Registration Statement(s), with all exhibits thereto and
hereto, and other documents with the Securities and Exchange Commission,
granting unto said attorney-in-fact and agent, and each of them, full power and
authority to do and perform each and every act and thing requisite or necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Dated: August 16, 2007 /s/ Bernard Berk
--------------------------------------------
Bernard Berk
Chief Executive Officer and
Chairman of the Board of Directors
Dated: August 16, 2007 /s/ Mark I. Gittelman
--------------------------------------------
Mark I. Gittelman
Chief Financial Officer
(Principal Financial and Accounting Officer)
Dated: August 16, 2007 /s/ Barry Dash
--------------------------------------------
Barry Dash
Director
Dated: August 16, 2007 /s/ Veerappan Subramanian
--------------------------------------------
Veerappan Subramanian
Director
Dated: August 16, 2007 /s/ Robert J. Levenson
--------------------------------------------
Robert J. Levenson
Director
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