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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Date of Report (Date of earliest event reported): December 3, 2004
DOBI MEDICAL INTERNATIONAL, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-32523 98-0222710
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
1200 MacArthur Boulevard 07430
Mahwah, New Jersey (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (201) 760-6464
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 DFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4 (c) under the
Exchange Act (17 CFR 240.13e-4(c))
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SECTION 8 - OTHER EVENTS
ITEM 8.01. OTHER EVENTS.
The purpose of this Current Report on Form 8-K is to amend the
description of our securities contained in Item 8 of our General Form For
Registration of Securities of Small Business Issuers on Form 10-SB, as amended,
which was filed with the U.S. Securities and Exchange Commission (the "SEC") on
October 4, 2001, when our company was known as Lions Gate Investment Limited, a
Nevada corporation.
As previously reported on a Current Report on Form 8-K filed with the
SEC on February 2, 2004, on January 30, 2004, in order to effect a
reincorporation from Nevada to Delaware, Lions Gate Investment Limited was
merged with and into DOBI Medical International, Inc., a Delaware corporation
(all as more fully described in Lions Gate's definitive Information Statement on
Schedule 14C, which was filed with the SEC on January 9, 2004). At the effective
time of the reincorporation, DOBI Medical International became the surviving
entity of the merger as well as the registrant for reporting purposes under the
federal securities laws. The merged entity is governed by the Delaware General
Corporation Law and the certificate of incorporation and by-laws of DOBI Medical
International.
At the effective time of the reincorporation, each outstanding share of
common stock, par value $.0001 per share, of Lions Gate was automatically
converted into one share of common stock, par value $.0001 per share, of DOBI
Medical International.
The foregoing description of the reincorporation is not intended to be
complete and is qualified in its entirety by the complete text of the Current
Report on Form 8-K describing the reincorporation, and the exhibits filed with
such report.
As a result of the reincorporation, our shares of common stock ceased
to be governed by the Nevada General Corporation Law, and are now governed by
the Delaware General Corporation Law. Set forth below is a description of the
material rights of our securities under the Delaware General Corporation Law,
including provisions under our certificate of incorporation and by-laws that
would delay, defer or prevent a change in control of our company.
DESCRIPTION OF SECURITIES
Our authorized capital stock consists of 150,000,000 shares of stock,
of which 140,000,000 shares are designated common stock, par value $.0001 per
share, and 10,000,000 shares are designated preferred stock, par value $.0001
per share, with the right conferred upon the board of directors to set the
dividend, voting, conversion, liquidation and other rights, as well as the
qualifications, limitations and restrictions, with respect to such preferred
stock as the board of directors may determine from time to time. Of the
preferred stock, 520 shares have been designated as series A convertible
preferred stock. As of November 29, 2004, there were issued and outstanding:
o 37,748,292 shares of common stock, and
o 206.45 shares of series A convertible preferred stock.
The following summary of the material provisions of our common stock,
series A convertible preferred stock, certificate of incorporation and by-laws
is qualified by reference to the provisions of our certificate of incorporation
and by-laws, each as amended, which were previously filed with the SEC and are
incorporated as exhibits into this Current Report on Form 8-K.
COMMON STOCK
The holders of our common stock are entitled to one vote per share. The
holders of common stock are entitled to receive ratably such dividends, if any,
as may be declared by our board of directors out of legally available funds.
However, the current policy of our board of directors is to retain earnings, if
any, for the operation and expansion of our business. Upon liquidation,
dissolution or winding-up, the holders of common stock are entitled to share
ratably in all our assets which are legally available for distribution, after
payment of or provision for all liabilities and the liquidation preference of
any outstanding preferred stock. The holders of common stock have no preemptive,
subscription, redemption or conversion rights. All issued and outstanding shares
of common stock are, and the common stock reserved for issuance upon conversion
of the series A convertible preferred stock and exercise of the warrants
described below will be, when issued, fully-paid and non-assessable.
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SERIES A CONVERTIBLE PREFERRED STOCK
CONVERSION. Holders of series A convertible preferred stock will be
entitled at any time to convert their shares of series A convertible preferred
stock into common stock without any further payment therefor. We may also
require holders of series A convertible preferred stock to convert their shares
into common stock at any time upon 30 days written notice, after the closing
market price for a share of common stock on our principal trading market is at
least $6.00 for a period of 20 consecutive trading days, provided the common
stock has traded at or above such price for a period 10 days prior to the date
on which a notice of conversion is sent and, a registration statement covering
the shares of the common stock underlying the series A convertible preferred
stock and associated warrants has been declared and remains effective. Each
share of series A convertible preferred stock is initially convertible into
12,500 shares of common stock, based upon a stated value of $25,000 per share,
plus any accrued and unpaid dividends, at a price per share of common stock
equal to $2.00. The number of shares of common stock issuable upon conversion of
the series A convertible preferred stock is subject to adjustment upon the
occurrence of certain events, such as stock splits or reverse stock splits,
stock dividends, recapitalizations or similar events. Employee stock options,
warrants for commercial banks and equipment lessors, strategic alliances and
acquisitions approved by our board of directors are excluded from this
provision. Upon a merger or consolidation of our company with or into another
company, or any transfer, sale or lease by us of substantially all of our
assets, the series A convertible preferred stock will be treated as common stock
for all purposes, including the determination of any assets, property or stock
to which holders of the series A convertible preferred stock are entitled to
receive, or into which the series A convertible preferred stock is converted, by
reason of the consummation of such merger, consolidation, sale or lease.
ANTI-DILUTION PROVISIONS. In the event of any issuances of shares of
series A convertible preferred stock, common stock or stock options, warrants or
securities convertible or exercisable into common stock within two years after
the final closing of the offering of shares of series A convertible preferred
stock at a price per share of common stock less than the conversion price of the
series A convertible preferred stock, the conversion price of these shares of
series A convertible preferred stock will be adjusted to a lower price per share
computed on the basis of a "weighted average formula." In addition, the
conversion price of all the shares of series A convertible preferred stock
issued will be subject to adjustment in connection with any subdivision, stock
split, combination of shares or recapitalization. Employee stock options,
warrants for commercial banks and equipment lessors, strategic alliances and
acquisitions approved by our board of directors are excluded from this
provision.
LIQUIDATION PREFERENCE. In the event of any voluntary or involuntary
liquidation, dissolution or winding-up of our company, holders of series A
convertible preferred stock will be entitled to receive out of our assets
available for distribution to stockholders, before any distribution is made to
holders of our common stock, liquidating distributions in an amount equal to the
stated value of the series A convertible preferred stock, plus any accrued but
unpaid dividends.
Without the consent of holders of at least 50% of the then outstanding
shares of series A convertible preferred stock, we may not create, authorize or
issue any other series of preferred stock which rank senior to or pari passu
with the series A convertible preferred stock.
DIVIDENDS. Holders of series A convertible preferred stock will be
entitled to receive a quarterly cumulative dividend at the end of each calendar
quarter calculated at a rate of 8% per annum of the issue price of any
outstanding share of series A convertible preferred stock for the first three
years after the closing of the offering of shares of series A convertible
preferred stock, 10% per annum for the following two years and 12% per year for
any additional year in which any share of series A convertible preferred stock
remains outstanding. At our option, this dividend may be paid in either cash or
registered shares of common stock. In the case of payment in stock, this stock
will be valued at 95% of the average of the closing trading price of the common
stock for the 20 trading days ending on the day prior to the day on which such
payment is due.
VOTING RIGHTS. Holders of series A convertible preferred stock are not
entitled to vote, except to the extent they are entitled to do so by Delaware
law.
REDEMPTION. The series A convertible preferred stock may not be
redeemed by us at any time.
RESTRICTIONS ON TRANSFER. The offer and sale of the shares of series A
convertible preferred stock issued in our July 2004 private placement was not
registered under either federal or state securities laws or the laws of any
other country and was made pursuant to claims of exemption therefrom.
Consequently, neither the shares of series A convertible preferred stock nor the
shares of common stock underlying the series A convertible preferred stock may
be sold or otherwise transferred absent compliance with the registration or
qualification requirements of applicable securities laws or the exemptive
provisions thereof.
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ANTI-TAKEOVER, LIMITED LIABILITY AND INDEMNIFICATION PROVISIONS
CERTIFICATE OF INCORPORATION AND BY-LAWS. Pursuant to our certificate
of incorporation, our board of directors may issue additional shares of common
or preferred stock. Any additional issuance of common stock could have the
effect of impeding or discouraging the acquisition of control of us by means of
a merger, tender offer, proxy contest or otherwise, including a transaction in
which our stockholders would receive a premium over the market price for their
shares, and thereby protects the continuity of our management. Specifically, if
in the due exercise of its fiduciary obligations, the board of directors were to
determine that a takeover proposal was not in our best interest, shares could be
issued by our board of directors without stockholder approval in one or more
transactions that might prevent or render more difficult or costly the
completion of the takeover by:
o diluting the voting or other rights of the proposed acquirer or
insurgent stockholder group,
o putting a substantial voting block in institutional or other
hands that might undertake to support the incumbent board of
directors, or
o effecting an acquisition that might complicate or preclude the
takeover.
Our certificate of incorporation also allows our board of directors to
fix the number of directors in the by-laws. Cumulative voting in the election of
directors is specifically denied in our certificate of incorporation. The effect
of these provisions may be to delay or prevent a tender offer or takeover
attempt that a stockholder may determine to be in his or its best interest,
including attempts that might result in a premium over the market price for the
shares held by the stockholders.
DELAWARE ANTI-TAKEOVER LAW. We are subject to the provisions of Section
203 of the Delaware General Corporation Law concerning corporate takeovers. This
section prevents many Delaware corporations from engaging in a business
combination with any interested stockholder, under specified circumstances. For
these purposes, a business combination includes a merger or sale of more than
10% of our assets, and an interested stockholder includes a stockholder who owns
15% or more of our outstanding voting stock, as well as affiliates and
associates of these persons. Under these provisions, this type of business
combination is prohibited for three years following the date that the
stockholder became an interested stockholder unless:
o the transaction in which the stockholder became an interested
stockholder is approved by the board of directors prior to the date
the interested stockholder attained that status,
o upon consummation of the transaction that resulted in the
stockholder's becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction was commenced,
excluding those shares owned by persons who are directors and also
officers, or
o on or subsequent to that date, the business combination is
approved by the board of directors and authorized at an annual or
special meeting of stockholders by the affirmative vote of at least
two-thirds of the outstanding voting stock that is not owned by the
interested stockholder.
This statute could prohibit or delay mergers or other takeover or
change in control attempts and, accordingly, may discourage attempts to acquire
us.
LIMITED LIABILITY AND INDEMNIFICATION. Our certificate of incorporation
eliminates the personal liability of our directors for monetary damages arising
from a breach of their fiduciary duty as directors to the fullest extent
permitted by Delaware law. This limitation does not affect the availability of
equitable remedies, such as injunctive relief or rescission. Our certificate of
incorporation requires us to indemnify our directors and officers to the fullest
extent permitted by Delaware law, including in circumstances in which
indemnification is otherwise discretionary under Delaware law.
Under Delaware law, we may indemnify our directors or officers or other
persons who were, are or are threatened to be made a named defendant or
respondent in a proceeding because the person is or was our director, officer,
employee or agent, if we determine that the person:
o conducted himself or herself in good faith,
o reasonably believed, in the case of conduct in his or her
official capacity as our director or officer, that his or her
conduct was in our best interests, and, in all other cases, that
his or her conduct was at least not opposed to our best interests,
and
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o in the case of any criminal proceeding, had no reasonable cause to
believe that his or her conduct was unlawful.
These persons may be indemnified against expenses, including attorneys
fees, judgments, fines, including excise taxes, and amounts paid in settlement,
actually and reasonably incurred, by the person in connection with the
proceeding. If the person is found liable to the corporation, no indemnification
shall be made unless the court in which the action was brought determines that
the person is fairly and reasonably entitled to indemnity in an amount that the
court will establish. Insofar as indemnification for liabilities under the
Securities Act may be permitted to directors, officers or persons controlling us
pursuant to the above provisions, we have been informed that, in the opinion of
the SEC, such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
EXHIBIT NO. DESCRIPTION OF EXHIBIT
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3.1 Certificate of Incorporation of DOBI Medical
International, Inc.(1)
3.2 By-laws of DOBI Medical International, Inc.(1)
4.2 Certificate of Designation, Preferences and Rights
of Series A Convertible Preferred Stock of
DOBI Medical International, Inc.(2)
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(1) Incorporated by reference from the exhibits filed with the Current Report
on Form 8-K, dated January 30, 2004 (filed with the SEC on
February 2, 2004).
(2) Incorporated by reference from the exhibits filed with the Registration
Statement on Form SB-2 (filed with the SEC on September 14, 2004).
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DOBI MEDICAL INTERNATIONAL, INC.
Date: December 3, 2004 By: /s/ Phillip C. Thomas
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Phillip C. Thomas
Chief Executive Officer
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