Filed Pursuant to Rule 424(b)(3)
Registration No. 333-188139
PROSPECTUS SUPPLEMENT
Number 3
to
Prospectus dated June 27, 2013
of
ELITE PHARMACEUTICALS, INC.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
This Prospectus Supplement No. 3 supplements the information provided in our Prospectus dated June 27, 2013 as supplemented by Supplement No. 2 dated August 14, 2013 and Supplement No. 1 dated August 5, 2013. This Prospectus Supplement should be read in conjunction with that Prospectus and Supplements No. 1 and 2, which are to be delivered with this Prospectus Supplement.
This Prospectus Supplement includes our Quarterly Report on Form 10-Q for the period ended September 30, 2013, filed with the Securities and Exchange Commission on November 14, 2013, and our Registration Statement on Form 8-A, filed with the Securities and Exchange Commission on November 15, 2013.
The date of this Prospectus Supplement is November 15, 2013.
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended | September 30, 2013 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number: 001-15697 |
ELITE PHARMACEUTICALS, INC. |
(Exact name of registrant as specified in its charter) |
Nevada | 22-3542636 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
165 Ludlow Avenue, Northvale, New Jersey | 07647 | |
(Address of principal executive offices) | (Zip Code) |
(201) 750-2646 |
(Registrant's telephone number, including area code) |
Large Accelerated filer ¨ | Accelerated Filer ¨ | Non-Accelerated Filer ¨ | Smaller Reporting Company x |
Page No. | ||
PART I – FINANCIAL INFORMATION | ||
Item 1. | Financial Statements | |
Condensed Consolidated Balance Sheets as of September 30, 2013 (unaudited) and March 31, 2013 (audited) | F-1 | |
Condensed Consolidated Statements of Operations for the three and six months ended September 30, 2013 (unaudited) and September 30, 2012 (unaudited) | F-3 | |
Condensed Consolidated Statement of Changes in Stockholders’ Deficit for the six months ended September 30, 2013 (unaudited) | F-4 | |
Condensed Consolidated Statements of Cash Flows for the three months ended September 30, 2013 (unaudited) and September 30, 2012 (unaudited) | F-5 | |
Notes to Condensed Consolidated Financial Statements | F-6 | |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 1 |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 17 |
Item 4. | Controls and Procedures | 17 |
PART II – OTHER INFORMATION | ||
Item 1. | Legal Proceedings | 17 |
Item 1A. | Risk Factors | 17 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 18 |
Item 3. | Defaults upon Senior Securities | 18 |
Item 4. | Mine Safety Disclosures | 18 |
Item 5. | Other Information | 18 |
Item 6. | Exhibits | 18 |
SIGNATURES | 24 |
September 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | (Audited) | ||||||
ASSETS | |||||||
CURRENT ASSETS | |||||||
Cash and cash equivalents | $ | 766,201 | $ | 369,023 | |||
Accounts receivable (net of allowance for doubtful accounts of -0-) | 635,959 | 665,154 | |||||
Inventories (net of reserve of -0- and $93,338, respectively) | 1,719,673 | 1,358,146 | |||||
Prepaid expenses and other current assets | 156,916 | 151,051 | |||||
Total Current Assets | 3,278,749 | 2,543,374 | |||||
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $5,283,619 and $5,068,522, respectively | 3,940,211 | 4,028,943 | |||||
INTANGIBLE ASSETS – net of accumulated amortization of $-0- | 6,314,004 | 694,426 | |||||
OTHER ASSETS | |||||||
Investment in Novel Laboratories, Inc. | 3,329,322 | 3,329,322 | |||||
Security deposits | 14,314 | 14,314 | |||||
Restricted cash – debt service for EDA bonds | 295,462 | 267,820 | |||||
EDA bond offering costs, net of accumulated amortization of $114,608 and $107,519, respectively | 239,845 | 246,934 | |||||
Total Other Assets | 3,878,943 | 3,858,390 | |||||
TOTAL ASSETS | $ | 17,411,907 | $ | 11,125,133 |
F-1 | ||
September 30, | March 31, | ||||||
2013 | 2013 | ||||||
(Unaudited) | (Audited) | ||||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | |||||||
CURRENT LIABILITIES | |||||||
EDA bonds payable | $ | 3,385,000 | $ | 3,385,000 | |||
Short term loans and current portion of long-term debt | 2,916 | 6,296 | |||||
Convertible Note Payable (net of debt discount of $4,219,292 and -0-, respectively) | 5,780,708 | -0- | |||||
Related Party Line of Credit | 600,000 | 600,000 | |||||
Accounts payable and accrued expenses | 1,925,375 | 1,325,126 | |||||
Deferred revenues | 13,333 | 13,333 | |||||
Preferred share derivative interest payable | 16,365 | 27,500 | |||||
Total Current Liabilities | 11,723,697 | 5,357,255 | |||||
LONG TERM LIABILITIES | |||||||
Deferred revenues | 145,556 | 152,223 | |||||
Other long term liabilities | 96,078 | 91,571 | |||||
Derivative liability – preferred shares | 203,008 | 6,334,621 | |||||
Derivative liability – warrants | 11,095,970 | 7,862,848 | |||||
Total Long Term Liabilities | 11,540,612 | 14,441,263 | |||||
TOTAL LIABILITIES | 23,264,309 | 19,798,518 | |||||
STOCKHOLDERS’ DEFICIT | |||||||
Common stock – par value $0.001, Authorized 690,000,000 shares. Issued 494,811,263 shares and 374,493,959 shares, respectively. Outstanding 494,711,263 shares and 374,393,959 shares, respectively | 494,812 | 374,495 | |||||
Additional paid-in-capital | 131,106,847 | 119,690,336 | |||||
Accumulated deficit | (137,147,220) | (128,431,375) | |||||
Treasury stock at cost (100,000 common shares) | (306,841) | (306,841) | |||||
TOTAL STOCKHOLDERS’ DEFICIT | (5,852,402) | (8,673,385) | |||||
TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | 17,411,907 | $ | 11,125,133 |
F-2 | ||
THREE MONTHS ENDED | SIX MONTHS ENDED | ||||||||||||
September 30, | September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
REVENUES | |||||||||||||
Manufacturing Fees | $ | 921,347 | $ | 466,020 | $ | 1,464,780 | $ | 845,716 | |||||
Royalties & Profit Splits | 231,578 | 154,168 | 404,833 | 282,663 | |||||||||
Lab Fee Revenues | 5,972 | 14,329 | 10,972 | 84,693 | |||||||||
Total Revenues | 1,158,897 | 634,517 | 1,880,585 | 1,213,072 | |||||||||
COSTS OF REVENUES | 616,635 | 479,631 | 1,195,647 | 933,995 | |||||||||
Gross Profit | 542,262 | 154,886 | 684,938 | 279,077 | |||||||||
OPERATING EXPENSES | |||||||||||||
Research and Development | 854,777 | 228,475 | 1,424,268 | 425,357 | |||||||||
General and Administrative | 272,561 | 401,174 | 649,018 | 766,135 | |||||||||
Non-cash compensation through issuance of stock options | 18,937 | 15,133 | 28,424 | 21,246 | |||||||||
Depreciation and Amortization | 82,567 | 25,372 | 245,399 | 67,370 | |||||||||
Total Operating Expenses | 1,228,842 | 670,154 | 2,347,109 | 1,280,108 | |||||||||
(LOSS) FROM OPERATIONS | (686,580) | (515,268) | (1,662,171) | (1,001,031) | |||||||||
OTHER INCOME / (EXPENSES) | |||||||||||||
Interest expense, net | (255,945) | (61,247) | (330,723) | (119,784) | |||||||||
Change in fair value of warrant derivatives | (6,129,579) | 2,093,653 | (3,233,122) | (2,995,081) | |||||||||
Change in fair value of preferred share derivatives | (2,565,495) | (187,383) | (3,466,332) | (4,830,866) | |||||||||
Interest expense attributable to preferred share derivatives | (17,476) | (28,823) | (41,060) | (83,901) | |||||||||
Discount in Series E issuance attributable to beneficial conversion features | — | (250,000) | — | (437,500) | |||||||||
Other Income | 19,831 | — | 19,831 | — | |||||||||
Total Other Income / (Expense) | (8,948,664) | 1,566,200 | (7,051,406) | (8,467,132) | |||||||||
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES | (9,635,244) | 1,050,932 | (8,713,577) | (9,468,163) | |||||||||
PROVISION FOR INCOME TAXES | (2,269) | (1,023) | (2,269) | (4,023) | |||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS | $ | (9,637,513) | $ | 1,049,909 | $ | (8,715,846) | $ | (9,472,186) | |||||
NET (LOSS) PER SHARE | |||||||||||||
Basic | $ | (0.02) | $ | 0.00 | $ | (0.02) | $ | (0.03) | |||||
Diluted | $ | (0.02) | $ | 0.00 | $ | (0.02) | $ | (0.03) | |||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | |||||||||||||
Basic | 421,991,654 | 348,298,807 | 405,073,773 | 342,712,859 | |||||||||
Diluted | 421,991,654 | 505,759,554 | 405,073,773 | 342,712,859 |
F-3 | ||
Common Stock | Treasury Stock | |||||||||||||||||||||
Additional | ||||||||||||||||||||||
Paid-In | Accumulated | Stockholders’ | ||||||||||||||||||||
Shares | Amount | Capital | Shares | Amount | Deficit | Deficit | ||||||||||||||||
Balance at March 31, 2013 | 374,493,959 | $ | 374,495 | $ | 119,690,336 | 100,000 | $ | (306,841) | $ | (128,431,375) | $ | (8,673,385) | ||||||||||
Net Loss | (8,715,845) | (8,715,845) | ||||||||||||||||||||
Common shares sold pursuant to the Lincoln Park Capital purchase agreement | 25,856,021 | 25,856 | 1,874,144 | 1,900,000 | ||||||||||||||||||
Common shares issued in lieu of cash in payment of preferred share derivative interest expense | 724,714 | 725 | 51,471 | 52,196 | ||||||||||||||||||
Conversion of Series C, Series E and Series G Preferred Shares into Common Shares | 90,150,920 | 90,150 | 9,507,795 | 9,597,945 | ||||||||||||||||||
Non-cash compensation through the issuance of stock options | 28,424 | 28,424 | ||||||||||||||||||||
Costs associated with raising capital | (47,987) | (47,987) | ||||||||||||||||||||
Common shares issued as commitment shares pursuant to the Lincoln Park Capital purchase agreement | 3,485,649 | 3,486 | (3,486) | — | ||||||||||||||||||
Common shares issued pursuant to the exercise of cash warrants | 100,000 | 100 | 6,150 | 6,250 | ||||||||||||||||||
Balance at September 30, 2013 | 494,811,263 | $ | 494,812 | $ | 131,106,847 | 100,000 | $ | (306,841) | $ | (137,147,220) | $ | (5,857,402) |
F-4 | ||
SIX MONTHS ENDED SEPTEMBER 30 | |||||||
2013 | 2012 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net Loss | $ | (8,715,845) | $ | (9,472,186) | |||
Adjustments to reconcile net loss to cash used in operating activities: | |||||||
Depreciation and amortization | 222,299 | 236,143 | |||||
Change in fair value of warrant derivative liability | 3,233,122 | 2,995,081 | |||||
Change in fair value of preferred share derivative liability | 3,466,332 | 4,830,866 | |||||
Discount in Series E issuance attributable to embedded beneficial conversion feature | — | 437,500 | |||||
Preferred share derivative interest satisfied by the issuance of common stock | 52,196 | 126,106 | |||||
Non-cash compensation accrued | 154,750 | 95,000 | |||||
Non-Cash Interest Expense | 183,391 | ||||||
Non-cash compensation satisfied by the issuance of common stock and options | 28,424 | 21,246 | |||||
Non-cash rent expense | 3,799 | 4,809 | |||||
Non-cash lease accretion | 708 | 667 | |||||
Changes in Assets and Liabilities | |||||||
Accounts receivable | 29,195 | (166,096) | |||||
Inventories | (361,527) | (175,853) | |||||
Prepaid and other current assets | (5,865) | 15,592 | |||||
Accounts payable, accrued expenses and other current liabilities | 442,119 | (39,828) | |||||
Deferred revenues and Customer deposits | (6,667) | (6,669) | |||||
Derivative interest payable | (11,135) | (42,206) | |||||
NET CASH USED IN OPERATING ACTIVITIES | (1,284,704) | (1,139,828) | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Purchases of property and equipment | (120,396) | (96,156) | |||||
Cost of leasehold improvements | (6,082) | (20,082) | |||||
Costs incurred for intellectual property assets | (22,261) | (23,315) | |||||
Deposits to / (withdrawals from) restricted cash, net | (27,642) | 6,554 | |||||
NET CASH USED IN INVESTING ACTIVITIES | (176,381) | (132,999) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Proceeds from issuance of Series E Convertible Preferred Stock | — | 437,500 | |||||
Proceeds from sale of common shares to Lincoln Park Capital | 1,900,000 | — | |||||
Proceeds from exercise of cash warrants | 6,250 | 187,500 | |||||
Proceeds from draws against Treppel credit line | 200,000 | ||||||
Other loan payments | — | (3,381) | |||||
Costs associated with raising capital | (47,987) | (9,856) | |||||
NET CASH PROVIDED BY FINANCING ACTIVITIES | 1,858,263 | 811,763 | |||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | 397,178 | (461,064) | |||||
CASH AND CASH EQUIVALENTS – beginning of period | 369,023 | 668,407 | |||||
CASH AND CASH EQUIVALENTS – end of period | $ | 766,201 | $ | 207,343 | |||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid for interest | $ | 146,624 | $ | 115,826 | |||
Cash paid for taxes | — | 4,023 | |||||
Non-Cash Financing Transactions | |||||||
Commitment shares issued to Lincoln Park Capital | 260,538 | ||||||
Conversion of Preferred Shares to Common Shares | 9,597,945 | ||||||
Acquisition of intellectual property | 5,597,317 | ||||||
Convertible Note Payable | 5,597,317 |
F-5 | ||
Common Shares Issued |
148,804 |
Payment Date | Amount | |||
September 1, 2010 | 225,000 | |||
September 1, 2011 | 470,000 | |||
September 1, 2012 | 730,000 | |||
September 1, 2013 | 915,000 |
F-6 | ||
Payment Date | Amount | |||
March 1, 2009 | $ | 120,775 | ||
September 1, 2009 | 120,775 | |||
March 1, 2010 | 113,075 | |||
September 1, 2010 | 113,075 | |||
March 1, 2011 | 113,075 | |||
September 1, 2011 | 113,075 | |||
March 1, 2012 | 113,075 | |||
September 1, 2012 | 113,075 | |||
March 1, 2013 | 113,075 | |||
September 1, 2013 | 113,075 |
Payment Date | Amount | |||
September 1, 2009 | 210,000 |
F-7 | ||
Cash reserves (“Cash Reserves”) | $ | 0.8 million | ||
Working capital deficit (“Working Capital Deficit”) | $ | 8.4 million | ||
Losses from operations for the Current Quarter | $ | 0.7 million | ||
Other loss for the Current Quarter | $ | 8.9 million | ||
Net loss for the Current Quarter | $ | 9.6 million | ||
NJEDA Bonds Payable (“Current Bond Liability”) | $ | 3.4 million |
F-8 | ||
F-9 | ||
Three Months Ended | Six Months Ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Initial commitment shares issued | — | — | 2,929,115 | — | |||||||||
Additional commitment shares issued | 439,369 | — | 556,534 | — | |||||||||
Purchased shares issued | 19,982,403 | — | 25,856,021 | — | |||||||||
Proceeds from purchased shares | $ | 1,500,000 | — | $ | 1,900,000 | $ | — |
September 30, 2013 | March 31, 2013 | ||||||
Raw Materials | $ | 910,187 | $ | 774,758 | |||
Work-in-Process | 809,486 | 676,726 | |||||
Finished Goods | — | — | |||||
Less: Inventory Reserve | — | (93,338) | |||||
Total Inventory | $ | 1,719,673 | $ | 1,358,146 |
F-10 | ||
Patent | Total | |||||||||
Application | ANDA | Intangible | ||||||||
Costs | Acquisitions | Assets | ||||||||
Intangible Assets as of March 31, 2013 | $ | 244,424 | $ | 450,000 | $ | 694,424 | ||||
Costs Capitalized During Current Fiscal Year | ||||||||||
Three months ended June 30, 2013 | 18,498 | — | 18,498 | |||||||
Three months ended September 30, 2013 | 3,765 | 5,597,317 | 5,601,082 | |||||||
Total Costs Capitalized-six months ended September 30, 2013 | 22,263 | 5,597,317 | 5,619,580 | |||||||
Amortization of Intangible Assets During Current Fiscal Year | ||||||||||
Three months ended June 30, 2013 | — | — | — | |||||||
Three months ended September 30, 2013 | — | — | — | |||||||
Total Amortization – three months ended September 30, 2013 | — | — | — | |||||||
Intangible Assets as of September 30, 2013 | $ | 266,687 | $ | 6,047,317 | $ | 6,314,004 |
Principal | ||||||||
Amount | ||||||||
On | Interest | |||||||
Description | Issue Date | Rate | Maturity | |||||
Series A Note | 3,660,000 | 6.50 | % | September 1, 2030 | ||||
Series B Note | 495,000 | 9.0 | % | September 1, 2012 |
F-11 | ||
Description | Amount | |||
Series A Note Proceeds | $ | 366,000 | ||
Series B Note Proceeds | 49,500 | |||
Total | $ | 415,500 |
Balances | ||||||||||
As of | ||||||||||
Balances | Amortization | Current | ||||||||
As of | Expense | Balance Sheet | ||||||||
Description | March 31, 2013 | Current YTD | Date | |||||||
Bond Issue Costs | $ | 354,453 | $ | 354,453 | ||||||
Accumulated Amortization | (107,519) | (7,089) | (114,608) | |||||||
Unamortized Balance | $ | 246,934 | $ | 239,845 |
Payment Date | Amount | |||
March 1, 2009 | $ | 120,775 | ||
September 1, 2009 | 120,775 | |||
March 1, 2010 | 113,075 | |||
September 1, 2010 | 113,075 | |||
March 1, 2011 | 113,075 | |||
September 1, 2011 | 113,075 | |||
March 1, 2012 | 113,075 | |||
September 1, 2012 | 113,075 | |||
March 1, 2013 | 113,075 | |||
September 1, 2013 | 113,075 |
Payment Date | Amount | |||
September 1, 2009 | $ | 210,000 |
F-12 | ||
Payment Date | Amount | |||
September 1, 2010 | $ | 225,000 (1) | ||
September 1, 2011 | 470,000 (2) | |||
September 1, 2012 | 730,000 (3) | |||
September 1, 2013 | 915,000(4) |
F-13 | ||
Preferred Stock Derivative Liability as of Current Balance Sheet Date | |||||||||||||
Series C | Series E | Series G | Total | ||||||||||
Preferred Shares Authorized | 3,200 | 4,000 | 1,375 | 8,575 | |||||||||
Preferred shares Outstanding | 24 | — | 158 | 182 | |||||||||
Underlying common shares into which Preferred may convert | 160,000 | — | 1,478,479 | 1,638,479 | |||||||||
Closing price on valuation date | $ | 0.12 | $ | 0.12 | $ | 0.12 | $ | 0.12 | |||||
Preferred stock derivative liability at Current Balance Sheet Date | $ | 19,824 | — | $ | 183,184 | $ | 203,008 | ||||||
Preferred stock derivative liability at March 31, 2013 | $ | 697,584 | $ | 5,637,037 | — | $ | 6,334,621 |
CHANGE IN VALUE OF PREFERRED STOCK DERIVATIVE LIABILITY | |||||||||||||
Three months ended | Six months ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Change in Preferred Stock Derivative Liability | $ | (2,565,495) | $ | (187,383) | $ | (3,466,332) | $ | (4,830,866) |
FAIR VALUE OF WARRANT DERIVATIVE LIABILITY | |||||||||||||
March 31 | June 30 | September 30 | |||||||||||
2013 | 2013 | 2013 | |||||||||||
Risk-Free interest rate | 0.04% - 0.77% | 0.02% - 1.41% | 0.03% - 1.39% | ||||||||||
Expected volatility | 106% - 168% | 35% - 97% | 62% - 117% | ||||||||||
Expected life (in years) | 0.5 – 5.1 | 0.2 – 4.8 | 0.8 – 4.6 | ||||||||||
Expected dividend yield | — | — | — | ||||||||||
Number of warrants | 139,344,939 | 139,344,939 | 120,491,539 | ||||||||||
Fair Value of | |||||||||||||
Warrant Derivative Liability | $ | 7,862,848 | $ | 4,966,391 | $ | 11,095,970 |
CHANGE IN VALUE OF WARRANT DERIVATIVE LIABILITY | |||||||||||||
Three months ended | Six months ended | ||||||||||||
September 30 | September 30 | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Change in Warrant Derivative Liability | $ | (6,129,579) | $ | 2,093,653 | $ | (3,233,122) | $ | (2,995,081) |
F-14 | ||
Fiscal year ended March 31, 2014 | 83,259 | |||
Fiscal year ended March 31, 2015 | 85,344 | |||
Fiscal year ended March 31, 2016 | 87,363 | |||
Fiscal year ended March 31, 2017 | 89,112 | |||
Fiscal year ended March 31, 2018 | 90,894 | |||
Total Minimum 5 year lease payments | $ | 435,972 |
RENT EXPENSE | |||||||||||||
Three months ended | Six months ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Rent Expense | $ | 22,584 | $ | 22,584 | $ | 45,169 | $ | 45,169 | |||||
Change in deferred rent liability | $ | 1,899 | $ | 2,403 | $ | 3,799 | $ | 4,807 |
F-15 | ||
DEFERRED RENT LIABILITY (LONG-TERM LIABILITY) | ||||||||||
March 31 | June 30 | September 30 | ||||||||
2013 | 2013 | 2013 | ||||||||
Balance of Deferred Rent Liability | $ | 68,260 | $ | 70,160 | $ | 72,062 |
Advance payment received | $ | 200,000 | ||
Total revenue recognized as of March 31, 2013 | (34,444) | |||
Revenue recognized six months ended June 30, 2013 | (6,667) | |||
Total Deferred Revenues as of Current Balance Sheet Date | $ | 158,889 | ||
Current Portion of Deferred Revenues as of Current Balance Sheet Date | $ | 13,333 | ||
Non-Current Portion of Deferred Revenues as of Current Balance Sheet Date | $ | 145,556 |
Shares | ||||
Of | ||||
Description | Common Stock | |||
Common Shares issued in lieu of cash in payment of Preferred Share Derivative Interest | 724,714 | |||
Common Shares issued pursuant to the conversion of Series C, Series E and Series G Preferred Share derivatives | 90,150,920 | |||
Common shares sold pursuant to the LPC Purchase Agreement | 25,856,021 | |||
Common shares issued as commitment shares pursuant to the LPC Purchase Agreement | 3,485,649 | |||
Common shares issued pursuant to the exercise of cash warrants | 100,000 | |||
Total Common Shares issued during the Current YTD | 120,317,304 |
F-16 | ||
Number of Options | Range of Exercise Prices | ||||
Vested Options | 2,552,332 | $0.06 to $2.80 | |||
Non-Vested Options | 4,156,668 | $0.07 to $2.25 |
For the Three Months | For the Six Months | ||||||||||||
Ended September 30, | Ended September 30 | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Numerator | |||||||||||||
Net Income (loss) attributable to common shareholders - Basic | $ | (9,637,513) | $ | 1,049,909 | $ | (8,715,846) | $ | (9,472,186) | |||||
Net Income attributable to common shareholders - Diluted | n/a | 1,078,733 | n/a | n/a | |||||||||
Denominator | |||||||||||||
Weighted-average shares of common stock outstanding | 421,991,654 | 348,298,807 | 405,073,773 | 342,712,859 | |||||||||
Dilutive effect of stock options, warrants and convertible securities | n/a | 157,460,747 | n/a | n/a | |||||||||
Net (loss) income per share | |||||||||||||
Basic | $ | (0.02) | $ | (0.00) | $ | (0.02) | $ | (0.03) | |||||
Diluted | $ | (0.02) | $ | (0.00) | $ | (0.02) | $ | (0.03) |
F-17 | ||
F-18 | ||
Face value of Note | $ | 10,000,000 | ||
Net present value of Note at date of issuance | 5,597,317 | |||
Aggregate cost of ANDA’s acquired | 5,597,317 | |||
Debt discount at date of Note issuance | 4,140,018 |
For the Three Months | For the Six Months | ||||||||||||
Ended September 30, | Ended September 30 | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Interest expense on note payable to Mikah Pharma LLC | $ | 183,391 | — | $ | 183,391 | — |
F-19 | ||
F-20 | ||
F-21 | ||
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Exhibit Number | Description | |
2.1 | Agreement and Plan of Merger between Elite Pharmaceuticals, Inc., a Delaware corporation (“Elite-Delaware”) and Elite Pharmaceuticals, Inc., a Nevada corporation (“Elite-Nevada”), incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed with the SEC on January 9, 2012. | |
3.1(a) | Articles of Incorporation of Elite-Nevada, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on January 9, 2012. | |
3.1(b) | Certificate of Incorporation of Elite-Delaware, together with all other amendments thereto, as filed with the Secretary of State of the State of Delaware, incorporated by reference to (a) Exhibit 4.1 to the Registration Statement on Form S-4 (Reg. No. 333-101686), filed with the SEC on December 6, 2002 (the “Form S-4”), (b) Exhibit 3.1 to the Company’s Current Report on Form 8-K dated July 28, 2004 and filed with the SEC on July 29, 2004, (c) Exhibit 3.1 to the Company’s Current Report on Form 8-K dated June 26, 2008 and filed with the SEC on July 2, 2008, and (d) Exhibit 3.1 to the Company’s Current Report on Form 8-K dated December 19, 2008 and filed with the SEC on December 23, 2008.* | |
3.1(c) | Certificate of Designations, Preferences and Rights of Series A Preferred Stock, as filed with the Secretary of the State of Delaware, incorporated by reference to Exhibit 4.5 to the Current Report on Form 8-K dated October 6, 2004, and filed with the SEC on October 12, 2004.* |
18 | ||
3.1(d) | Certificate of Retirement with the Secretary of the State of the Delaware to retire 516,558 shares of the Series A Preferred Stock, as filed with the Secretary of State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated March 10, 2006, and filed with the SEC on March 14, 2006.* | |
3.1(e) | Certificate of Designations, Preferences and Rights of Series B 8% Convertible Preferred Stock, as filed with the Secretary of the State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated March 15, 2006, and filed with the SEC on March 16, 2006.* | |
3.1(f) | Amended Certificate of Designations of Preferences, Rights and Limitations of Series B 8% Convertible Preferred Stock, as filed with the Secretary of State of the State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated April 24, 2007, and filed with the SEC on April 25, 2007.* | |
3.1(g) | Certificate of Designations, Preferences and Rights of Series C 8% Convertible Preferred Stock, as filed with the Secretary of the State of Delaware, incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K dated April 24, 2007, and filed with the SEC on April 25, 2007.* | |
3.1(h) | Amended Certificate of Designations, Preferences and Rights of Series C 8% Convertible Preferred Stock, as filed with the Secretary of the State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated April 24, 2007, and filed with the SEC on April 25, 2007.* | |
3.1(i) | Amended Certificate of Designations of Preferences, Rights and Limitations of Series B 8% Convertible Preferred Stock, as filed with the Secretary of State of the State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated September 15, 2008, and filed with the SEC on September 16, 2008.* | |
3.1(j) | Amended Certificate of Designations, Preferences and Rights of Series C 8% Convertible Preferred Stock, as filed with the Secretary of the State of Delaware, incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K dated September 15, 2008, and filed with the SEC on September 16, 2008.* | |
3.1(k) | Amended Certificate of Designations of Preferences, Rights and Limitations of Series D 8% Convertible Preferred Stock, as filed with the Secretary of State of the State of Delaware, incorporated by reference to Exhibit 3.3 to the Current Report on Form 8-K dated September 15, 2008, and filed with the SEC on September 16, 2008.* | |
3.1(l) | Certificate of Designation of Preferences, Rights and Limitations of Series E Convertible Preferred Stock, as filed with the Secretary of State of the State of Delaware, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K dated June 1, 2009, and filed with the SEC on June 5, 2009.* | |
3.1(m) | Amended Certificate of Designations of the Series D 8% Convertible Preferred Stock as filed with the Secretary of State of the State of Delaware on June 29, 2010, incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K, dated July 1, 2010 and filed with the SEC on July 1, 2010* | |
3.1(n) | Amended Certificate of Designations of the Series E Convertible Preferred Stock as filed with the Secretary of State of the State of Delaware on June 29, 2010, incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K, dated July 1, 2010 and filed with the SEC on July 1, 2010.* | |
3.1 (o) | Certificate of Designations of the Series G Convertible Preferred Stock as filed with the Secretary of State of the State of Nevada on April 18, 2013, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated April 18, 2013 and filed with the SEC on April 22, 2013.* |
19 | ||
3.2(a) | By-Laws of Elite-Nevada, incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed with the SEC on January 9, 2012. | |
3.2(b) | By-Laws of Elite-Delaware, as amended, incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form SB-2 (Reg. No. 333-90633) made effective on February 28, 2000 (the “Form SB-2”).* | |
4.1 | Socius Warrant to Purchase Common Stock, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed with the SEC on January 5, 2012. | |
4.2 | Form of specimen certificate for Common Stock of the Company, incorporated by reference to Exhibit 4.1 to the Form SB-2. | |
4.3 | Form of specimen certificate for Series B 8% Convertible Preferred Stock of the Company, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated March 15, 2006 and filed with the SEC on March 16, 2006.* | |
4.4 | Form of specimen certificate for Series C 8% Convertible Preferred Stock of the Company, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated April 24, 2007 and filed with the SEC on April 25, 2007.* | |
4.5 | Form of specimen certificate for Series G 8% Convertible Preferred Stock of the Company, incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated April 18, 2013 and filed with the SEC on April 22, 2013. | |
4.4 | Warrant to purchase 100,000 shares of Common Stock issued to DH Blair Investment Banking Corp., incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the period ended September 30, 2004.* | |
4.7 | Warrant to purchase 50,000 shares of Common Stock issued to Jason Lyons incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q for the period ended June 30, 2004.* | |
4.8 | Form of Warrant to purchase shares of Common Stock issued to designees of lender with respect to financing of an equipment loan incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the period ended June 30, 2004.* | |
4.9 | Form of Short Term Warrant to purchase shares of Common Stock issued to purchasers in the private placement which initially closed on October 6, 2004 (the “Series A Financing”), incorporated by reference to Exhibit 4.6 to the Current Report on Form 8-K, dated October 6, 2004, and filed with the SEC on October 12, 2004.* | |
4.10 | Form of Long Term Warrant to purchase shares of Common Stock issued to purchasers in the Series A Financing, incorporated by reference to Exhibit 4.7 to the Current Report on Form 8-K, dated October 6, 2004, and filed with the SEC on October 12, 2004.* | |
4.11 | Form of Warrant to purchase shares of Common Stock issued to the Placement Agent, in connection with the Series A Financing, incorporated by reference to Exhibit 4.8 to the Current Report on Form 8-K, dated October 6, 2004, and filed with the SEC on October 12, 2004.* | |
4.12 | Form of Replacement Warrant to purchase shares of Common Stock in connection with the offer to holders of Warrants in the Series A Financing (the “Warrant Exchange”), incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated December 14, 2005, and filed with the SEC on December 20, 2005.* |
20 | ||
4.13 | Form of Warrant to purchase shares of Common Stock to the Placement Agent, in connection with the Warrant Exchange, incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated December 14, 2005, and filed with the SEC on December 20, 2005.* | |
4.14 | Form of Warrant to purchase shares of Common Stock issued to purchasers in the private placement which closed on March 15, 2006 (the “Series B Financing”), incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated March 15, 2006 and filed with the SEC on March 16, 2006.* | |
4.15 | Form of Warrant to purchase shares of Common Stock issued to purchasers in the Series B Financing, incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K, dated March 15, 2006 and filed with the SEC on March 16, 2006.* | |
4.16 | Form of Warrant to purchase shares of Common Stock issued to the Placement Agent, in connection with the Series B Financing, incorporated by reference to Exhibit 4.4 to the Current Report on Form 8-K, dated March 15, 2006 and filed with the SEC on March 16, 2006.* | |
4.17 | Form of Warrant to purchase 600,000 shares of Common Stock issued to Indigo Ventures, LLC, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated July 12, 2006 and filed with the SEC on July 18, 2006.* | |
4.18 | Form of Warrant to purchase up to 478,698 shares of Common Stock issued to VGS PHARMA, LLC, incorporated by reference to Exhibit 3(a) to the Current Report on Form 8-K, dated December 6, 2006 and filed with the SEC on December 12, 2006.* | |
4.19 | Form of Non-Qualified Stock Option Agreement for 1,750,000 shares of Common Stock granted to Veerappan Subramanian, incorporated by reference to Exhibit 3(b) to the Current Report on Form 8-K, dated December 6, 2006 and filed with the SEC on December 12, 2006.* | |
4.20 | Form of Warrant to purchase shares of Common Stock issued to purchasers in the private placement which closed on April 24, 2007 (the “Series C Financing”), incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated April 24, 2007 and filed with the SEC on April 25, 2007.* | |
4.21 | Form of Warrant to purchase shares of Common Stock issued to the placement agent in the Series C Financing, incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K, dated April 24, 2007 and filed with the SEC on April 25, 2007.* | |
4.22 | Form of specimen certificate for Series D 8% Convertible Preferred Stock of the Company, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated September 15, 2008 and filed with the SEC on September 16, 2008.* | |
4.23 | Form of Warrant to purchase shares of Common Stock issued to purchasers in the private placement which closed on September 15, 2008 (the “Series D Financing”), incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated September 15, 2008 and filed with the SEC on September 16, 2008.* | |
4.24 | Form of Warrant to purchase shares of Common Stock issued to the placement agent in the Series D Financing, incorporated by reference to Exhibit 4.3 to the Current Report on Form 8-K, dated September 15, 2008 and filed with the SEC on September 16, 2008.* |
21 | ||
4.25 | Form of specimen certificate for Series E Convertible Preferred Stock of the Company, incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K, dated June 1, 2009, and filed with the SEC on June 5, 2009.* | |
4.26 | Warrant to purchase shares of Common Stock issued to Epic Investments, LLC in the initial closing of the Strategic Alliance Agreement, dated as of March 18, 2009, by and among the Company, Epic Pharma, LLC and Epic Investments, LLC, incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K, dated June 1, 2009, and filed with the SEC on June 5, 2009.* | |
10.1 | Amendment, dated as of November 1, 2011, to the Master Development and License Agreement, dated as of August 27, 2010, by and amount Mikah Pharma LLC and the Company. (Confidential Treatment granted with respect to portions of the Agreement). | |
10.2 | Securities Purchase Agreement with Socius dated December 30, 2011, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on January 5, 2012. | |
10.3 | Form of Lock-Up Agreement (included as Exhibit D to the Securities Purchase Agreement with Socius mentioned in 10.2 above), incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed with the SEC on January 5, 2012. | |
10.4 | Treppel Bridge Loan Agreement dated June 12, 2012, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on June 13, 2012. | |
10.5 | December 5, 2012 amendment to the Treppel Bridge Loan Agreement incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the SEC on December 10, 2012. | |
10.6 | Development And License Agreement between the Company and a Hong Kong-based client dated March 16, 2012 incorporated by reference to Exhibit 10.77 to the Annual Report on Form 10-K filed with the SEC on June 29, 2012. (Confidential Treatment granted with respect to portions of the Agreement). | |
10.7 | Letter Agreement between the Company and ThePharmaNetwork LLC, dated September 21, 2012, incorporated by reference to Exhibit 10.6 to the Quarterly Report on Form 10-Q filed with the SEC on November 14, 2012. (Confidential Treatment granted with respect to portions of the Agreement) | |
10.8 | Purchase Agreement between the Company and Lincoln Park Capital LLC dated April 19, 2013 , incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, dated April 18, 2013 and filed with the SEC on April 22, 2013. | |
10.9 | Registration Rights Agreement between the Company and Lincoln Park Capital LLC dated April 19, 2013 , incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, dated April 18, 2013 and filed with the SEC on April 22, 2013. | |
10.10 | August 1, 2013 Employment Agreement with Nasrat Hakim, incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K, dated August 1, 2013 and filed with the SEC on August 5, 2013. | |
10.11 | August 1, 2013 Mikah LLC Asset Purchase Agreement, incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, dated August 1, 2013 and filed with the SEC on August 5, 2013. (Confidential Treatment granted with respect to portions of the Agreement). |
22 | ||
10.12 | Revised Schedule 1 to the August 1, 2013 Mikah LLC Asset Purchase Agreement (revised to remove confidential treatment with regard to one item set forth thereon) | |
10.13 | August 1, 2013 Secured Convertible Note from the Company to Mikah Pharma LLC., incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, dated August 1, 2013 and filed with the SEC on August 5, 2013. | |
10.14 | August 1, 2013 Security Agreement from the Company to Mikah Pharma LLC., incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K, dated August 1, 2013 and filed with the SEC on August 5, 2013. | |
10.15 | Termination of June 2011, Manufacturing and Supply Agreement between Mikah Pharma LLC and the Company. | |
10.16 | October 15, 2013 Hakim Credit Line Agreement. ** | |
10.17 | October 2, 2013 Manufacturing and Licensing Agreement with Epic Pharma LLC. Confidential portions of this exhibit have been redacted and filed separately with the Commission pursuant to a confidential treatment request in accordance with Rule 24b-2 of the Securities Exchange Act of 1934, as amended. ** | |
10.18 | August 19, 2013, Master Services Agreement with Camargo Pharmaceutical Services, LLC.** | |
31.1 | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
31.2 | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | |
32.1 | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
32.2 | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 | |
101 | The following materials from Elite Pharmaceuticals’ Quarterly Report on Form 10-Q for the period ended September 30, 2013, formatted in eXtensible Business Reporting Language (“XBRL”): (i) the Condensed Consolidated Statements of Income; (ii) the Condensed Consolidated Balance Sheets; (iii) the Condensed Consolidated Statements of Cash Flows; and (iv) Notes to Condensed Consolidated Financial Statements. |
23 | ||
SIGNATURES
ELITE PHARMACEUTICALS, INC. | |||
Date: | November 14, 2013 | /s/ Nasrat Hakim | |
Nasrat Hakim | |||
Chief Executive Officer | |||
(Principal Executive Officer) | |||
Date: | November 14, 2013 | /s/ Carter J. Ward | |
Carter J. Ward | |||
Chief Financial Officer | |||
(Principal Financial and Accounting Officer) |
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United States
Securities and Exchange Commission
Washington, DC 20549
Form 8-A
For Registration of Certain Classes of Securities
Pursuant to Section 12(b) or 12(g) of The
Securities Exchange Act of 1934
ELITE PHARMACEUTICALS, INC.
(Exact Name of Registrant as Specified in Charter)
Nevada (State or Other Jurisdiction | 22-3542636 (IRS Employer |
165 Ludlow Avenue, Northvale NJ | 07647 | |
(Address of principal executive offices) | (Zip code) |
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class | Name of each exchange on which | |
to be so registered | each class is to be registered |
If this form relates to the registration of a class of securities pursuant to Section 12(b) of the Exchange Act and is effective pursuant to General Instruction A.(c), check the following box.¨
If this form relates to the registration of a class of securities pursuant to Section 12(g) of the Exchange Act and is effective pursuant to General Instruction A.(d), check the following box.x
Securities Act registration statement file number to which this form relates:Not Applicable
Securities to be registered pursuant to Section 12(g) of the Act:
Rights to Purchase Series H Junior Participating Preferred Stock, par value $0.01 per share
(Title of Class)
ITEM 1. Description of Registrant's Securities to be Registered.
On November 15, 2013, the board of directors of Elite Pharmaceuticals, Inc. (the “Company”) declared a dividend distribution of one right for each outstanding share of our common stock and one right for each share of Common Stock into which any of our outstanding Preferred Stock is convertible, to stockholders of record at the close of business on November 15, 2013. Each Right entitles the registered holder to purchase from the Company one “Unit” consisting of one one-millionth (1/1,000,000) of a share of Series H Junior Participating preferred stock, par value $0.01 per share (the “H Preferred Stock”), at a purchase price of $2.10 per Unit, subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement (“Rights Agreement”) between the Company and American Stock Transfer & Trust Company, LLC, as Rights Agent.
Initially, the Rights will be attached to all Common Stock and convertible H Preferred Stock certificates representing shares then outstanding, and no separate Rights certificates will be distributed. The Rights will separate from the Common Stock and convertible Preferred Stock, and a distribution date (the “Distribution Date”) will occur upon the date that is the earlier of
· | ten days following a public announcement that a person or group of affiliated or associated persons (an “Acquiring Person”) has (subject to certain exceptions) acquired, or obtained the right to acquire, beneficial ownership of 15% or more of the outstanding shares of our Common Stock (the “Share Acquisition Date”), other than as a result of repurchases of stock by the Company and |
· | ten days (or such later date as our board of directors shall determine) following the commencement of a tender offer or exchange offer that would result in a person or group beneficially owning 15% or more of such outstanding shares of our Common Stock. |
Until the Distribution Date,
· | the Rights will be evidenced by the certificates of our Common Stock and convertible Preferred Stock and will be transferred with and only with such Common Stock certificates convertible Preferred Stock certificates, |
· | new Common Stock and convertible Preferred Stock certificates issued after the record date will contain a notation incorporating the Rights Agreement by reference and |
· | the surrender for transfer of any certificates for Common Stock or convertible Preferred Stock outstanding will also constitute the surrender for transfer of the Rights associated with the Common Stock or convertible Preferred Stock represented by such certificates. |
The Rights are not exercisable until the Distribution Date and will expire at the close of business on November 15, 2023, unless earlier redeemed by the Company as described below.
2 |
As soon as practicable after the occurrence of the Distribution Date, Rights certificates will be mailed to holders of record of our Common Stock and convertible Preferred Stock as of the close of business on the Distribution Date and, thereafter, the separate Rights certificates alone will represent the Rights. Except as otherwise determined by our board of directors, only shares of our Common Stock and convertible Preferred Stock issued prior to the occurrence of the Distribution Date will be issued with Rights.
Generally, in the event that:
· | any person becomes an Acquiring Person; |
· | an Acquiring Person (i) consummates with the Company or any of its subsidiaries (a) certain mergers, or (b) securities transactions or asset transactions that are valued at more than $10 million or are not on arm’s length terms and conditions, or (ii) receives any (a) compensation not related to full time employment by the Company or any of its subsidiaries or (b) loan, guarantee or tax benefit; or |
· | the securities of the Company are reclassified, the Company is recapitalized or undergoes a merger with one of its subsidiaries while an Acquiring Person exists; |
each holder of a Right will thereafter have the right to receive, upon exercise, H Preferred Stock (or, in certain circumstances, cash, property or other securities of the Company) having a value equal to two times the exercise price of the Right. Notwithstanding any of the foregoing, following the occurrence of any of the events set forth in the bullets in this paragraph, all Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by any Acquiring Person will be null and void.
For example, at an exercise price of $2.10 per Unit, each Right not owned by an Acquiring Person (or by certain related parties) following an event set forth in the preceding paragraph would entitle its holder to purchase $4.20 worth of Units (or other consideration, as noted above), which is based on the then-current per share market price of our Common Stock, for $2.10. Assuming that one share of our Common Stock had a per share value of $0.50 at such time, the holder of each valid Right would be entitled to purchase 8.4 Units of H Preferred Stock, equivalent to 8.4 shares of Common stock, for $2.10.
In the event that, at any time following the occurrence of a Share Acquisition Date, (i) we are acquired in a merger or other business combination transaction in which we are not the surviving corporation (other than a merger that follows an offer for all outstanding shares of Common Stock and convertible Preferred Stock that our board of directors determines to be fair and otherwise in the best interests of the Company and its stockholders), or (ii) 50% or more of our assets, cash flow or earning power is sold or transferred, each holder of a Right (except Rights that previously have been exercised or voided) shall have the right to receive, upon exercise, common stock of the acquiring company having a value equal to two times the exercise price of the Right.
3 |
At any time after a person or group becomes an Acquiring Person and prior to the acquisition by such person or group of 50% or more of the outstanding Common Stock, our board of directors may exchange the Rights (other than Rights that are owned by the person or group and have become void), in whole or in part, at an exchange ratio of one share of common stock, or one one-millionth of a share of H Preferred Stock (or of a share of a class or series of our preferred stock having equivalent rights, preferences and privileges), per Right (subject to adjustment).
At any time until the occurrence of a Distribution Date, our board of directors may order the Company to redeem the Rights in whole, but not in part, at a price of $0.000001 per Right (payable in cash, common stock or other consideration deemed appropriate by the board). Immediately upon the action of the board ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the $0.000001 redemption price.
Until a Right is exercised, the holder of a Right will have, by virtue of ownership of the Right, no rights as a stockholder of the Company, including, without limitation, any right to vote or to receive dividends. While the distribution of the Rights will not be taxable to stockholders or to the Company, stockholders may, depending upon the circumstances, recognize taxable income in the event that the Rights become exercisable for H Preferred Stock (or other consideration) of the Company or for common stock of the acquiring company.
Any of the provisions of the Rights Agreement may be amended by action of our board of directors prior to the Distribution Date. After the Distribution Date, the provisions of the Rights Agreement may be amended by our board of directors in order to cure any ambiguity, to make changes that do not adversely affect the interests of holders of Rights, or to shorten or lengthen any time period under the Rights Agreement.
A copy of the Rights Agreement has been filed with the Securities and Exchange Commission as an exhibit to this Registration Statement on Form 8-A. A copy of the Rights Agreement is available free of charge from the Company. This summary description of the Rights does not purport to be complete and is qualified in its entirety by reference to the actual terms and provisions of the Rights Agreement, which is incorporated herein by reference.
4 |
On November 15, 2013, in conjunction with the Rights Agreement and the Rights dividend, the Company filed a Certificate of Designations establishing the H Preferred Stock. Each share of H Preferred Stock entitles the holders thereof to 1,000,000 votes on all matters submitted to a vote of the stockholders of the Company. The H Preferred Stock shall rank junior to the outstanding shares of Company Preferred Stock but shall have a priority on dividends over shares of Common Stock. Each share of H Preferred Stock shall be entitled to a dividend 1,000,000 times the aggregate per share amount of all cash dividends, and 1,000,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common Stock. Upon any liquidation, dissolution or winding up of the Company, no distribution shall be made to the holders of shares of any stock junior to the H Preferred Stock unless, prior thereto, the holders of shares of H Preferred Stock shall have received the greater of (x) $1,000,000 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon to the date of such payment (the “H Liquidation Preference”) and (y) an aggregate amount per share, subject to the provision for adjustment set forth in the Certificate of Designations, equal to 1,000,000 times the aggregate amount to be distributed per share to holders of shares of Common Stock, except distributions made ratably on the H Preferred Stock and all such parity stock in proportion to the total amounts to which the holders of all such shares are entitled upon such liquidation, dissolution or winding up. In addition, in the event that the Company enters into any consolidation, merger, combination or other transaction in which the shares its Common Stock are exchanged for or converted or changed into other securities, cash and/or any other property, then in any such case each share of H Preferred Stock shall at the same time be similarly exchanged, converted or changed into an amount per share equal to 1,000,000 times the aggregate amount of securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is converted, changed or exchanged. In the event the Company declares or pays any dividend on the Common Stock payable in shares of Common Stock, or effects a subdivision or combination or consolidation of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of H Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
A copy of the Certificate of Designations has been filed with the Securities and Exchange Commission as an exhibit to this Registration Statement on Form 8-A. A copy of the Certificate of Designations is available free of charge from the Company. This summary description of the Certificate of Designations does not purport to be complete and is qualified in its entirety by reference to the actual terms and provisions of the Certificate of Designations, which is incorporated herein by reference.
ITEM 2. Exhibits.
1. | Rights Agreement, dated as of November 15, 2013, between Elite Pharmaceuticals, Inc. and American Stock Transfer & Trust Company, LLC (the “Rights Agreement”). The Rights Agreement includes the Certificate of Designation of the Series H Junior Participating Preferred Stock, the Form of Rights Certificate and the Summary of the Right to Purchase Preferred Stock. |
2. | Certificate of Designation of the Series H Junior Participating Preferred Stock (included as an Exhibit to the Rights Agreement filed as Exhibit 1 hereto). |
5 |
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereto duly authorized.
Elite Pharmaceuticals, Inc. | ||
By: | /s/ Nasrat Hakim | |
Nasrat Hakim, | ||
President and Chief Executive Officer |
Dated as of: November 15, 2013
6 |