Unassociated Document
As filed
with the Securities and Exchange Commission on August 3, 2010
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
S-3
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
NEOPROBE
CORPORATION
(Exact
name of registrant as specified in its charter)
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Delaware
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31-1080091
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(State
or other jurisdiction
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(I.R.S.
Employer
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of
incorporation or organization)
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Identification
Number)
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425 Metro
Place North
Dublin,
Ohio 43017-1367
(614)
793-7500
(Address,
including zip code, and telephone number, including
area
code, of registrant’s principal executive offices)
Brent L.
Larson
Senior
Vice President and Chief Financial Officer
Neoprobe
Corporation
425 Metro
Place North
Dublin,
Ohio 43017-1367
(614)
822-2330
(Name,
address, including zip code, and telephone number,
including
area code, of agent for service)
Copies of
Correspondence to:
William
J. Kelly, Jr., Esq.
Brett P.
Thornton, Esq.
Porter,
Wright, Morris & Arthur LLP
41 South
High Street, Suite 2800
Columbus,
Ohio 43215-6194
(614)
227-2000
(614)
227-2100 (fax)
wjkelly@porterwright.com
Approximate
date of commencement of proposed sale to the public: From time to time after
this Registration Statement becomes effective as permitted by market
conditions.
If the
only securities being registered on this Form are being offered pursuant to
dividend or interest 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, other
than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: x
If this
Form is filed to register additional securities for an offering 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 filed 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. ¨
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” and “accelerated filer” and
“smaller reporting company” in Rule 12b-2 of the Exchange Act.
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Large
accelerated filer ¨
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Accelerated
filer ¨
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Non-accelerated
filer ¨
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Smaller
reporting company x
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(Do
not check if a smaller
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reporting company)
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Calculation
of Registration Fee
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Title
of each class of
securities to be registered
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Amount to be
registered (1)(2)(3)
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Proposed
maximum
offering price
per share(5)
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Proposed maximum
aggregate offering
price (1)(2)(3)(5)
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Amount of
registration fee
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Primary
Offering:
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Common
Stock, $0.001 par value
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Warrants
to Purchase Common Stock
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Units
of the Registrant’s Securities
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$ |
20,000,000 |
(4)
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$ |
1,426.00 |
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Secondary
Offering:
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Common
Stock, $0.001 par value
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15,000,000 |
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$ |
2.06 |
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$ |
30,900,000 |
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$ |
2,203.17 |
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Total
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$ |
3,629.17 |
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(1)
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Not
specified as to each class of securities to be registered in connection
with the primary offering pursuant to General Instruction II.D of Form S-3
under the Securities Act of 1933, as amended. Securities registered in
connection with the primary offering hereby may be sold separately,
together or in units with other securities registered
hereby.
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(2)
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This
registration statement covers: (i) such an indeterminate amount of common
stock (with accompanying warrants, if any), as may be sold, from time to
time, at indeterminate prices, by the registrant; (ii) such an
indeterminate amount of warrants, representing rights to purchase common
stock, as may be sold from time to time at indeterminate prices by the
registrant; (iii) such an indeterminate amount of common stock as may be
issued upon conversion, exercise or exchange of warrants that provide for
such conversion into, exercise for or exchange into shares of common
stock; and (iv) pursuant to Rule 416 under the Securities Act of 1933, as
amended, such an indeterminate number of shares of common stock as may be
issuable with respect to the shares being registered hereunder as a result
of stock splits, stock dividends, or similar
transactions.
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(3)
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The
proposed maximum offering price per class of security will be determined
from time to time by the registrant in connection with, and at the time
of, the issuance by the registrant of the securities registered hereunder
in connection with the primary
offering.
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(4)
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Estimated
solely for the purpose of calculating the registration fee pursuant to
Rule 457(o). The maximum aggregate offering price of the securities to be
registered in connection with the primary offering will not exceed
$20,000,000.
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(5)
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Estimated
solely for the purpose of calculating the amount of the registration fee
pursuant to Rule 457(c) of the Securities Act of 1933. The price per share
and aggregate offering price are based upon the average high and low
prices of the registrant’s common stock on July 30, 2010, as reported on
the OTC Bulletin Board. It is not known how many shares will be purchased
under this Registration Statement or at what price such shares will be
purchased.
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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 Commission, acting pursuant to said Section 8(a),
may determine.
The
information in this prospectus is not complete and may be changed. We 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 an offer to buy these securities in
any state where the offer or sale is not permitted.
Subject
to completion, dated August 3, 2010
PROSPECTUS
NEOPROBE
CORPORATION
$20,000,000
Common
Stock
Common
Stock Warrants
Units
15,000,000
Shares of Common Stock
Offered
by Selling Stockholders
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·
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We
may offer from time to time to sell, separately or together as units: (1)
shares of our common stock; and (2) warrants to purchase our common stock.
The aggregate offering price of shares of common stock and warrants to
purchase common stock sold by us under this prospectus will not exceed
$20,000,000. In addition, this prospectus covers resales of 15,000,000
shares our common stock owned by Platinum-Montaur Life Sciences, LLC and
its transferees, in the circumstances we describe (the “selling stockholder”).
We will not receive any proceeds from the sale, if any, of common stock by
the selling stockholder.
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This
prospectus provides a general description of the securities we or the
selling stockholders may offer. Each time we or the selling stockholders
sell securities, we will provide specific terms of the securities offered
in a supplement to this prospectus. The prospectus supplement may also
add, update or change information contained in this prospectus. You should
read this prospectus and the applicable prospectus supplement carefully
before you invest in any securities. This prospectus may not be used to
consummate a sale of securities unless accompanied by the applicable
prospectus supplement.
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We
or the selling stockholders will sell these securities directly to
purchasers or through agents on our behalf or through underwriters or
dealers as designated from time to time. If any agents or underwriters are
involved in the sale of any of these securities, the applicable prospectus
supplement will provide the names of the agents or underwriters and any
applicable fees, commissions or
discounts.
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The
last reported sale price of our common stock on August 2, 2010 was $2.01
per share.
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Trading
symbol: OTC Bulletin Board – NEOP.
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Investing
in our securities involves a high degree of risk. Before investing in our
securities, we recommend that you carefully read this entire prospectus,
including the “Risk Factors” section beginning on page 4, any applicable
supplements to this prospectus and the documents we file with the Securities and
Exchange Commission from time to time.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved of anyone’s investment in these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
Neoprobe
Corporation
425 Metro
Place North, Suite 300
Dublin,
OH 43017-1367
(614)
793-7500
The date
of this prospectus is August _, 2010
TABLE
OF CONTENTS
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Page
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About
This Prospectus
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2
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About
Neoprobe Corporation
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2
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Risk
Factors
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3
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Special
Note Regarding Forward-Looking Statements
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13
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Capitalization
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14
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Where
You Can Find More Information and Incorporation by
Reference
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15
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Use
of Proceeds
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16
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Description
of Capital Stock
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16
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Description
of Warrants
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17
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Description
of Units
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18
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Anti-Takeover
Charter Provisions and Laws
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18
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Selling
Stockholders
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20
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Plan
of Distribution
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21
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Legal
Matters
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22
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Experts
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22
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ABOUT
THIS PROSPECTUS
This prospectus is a part of a
registration statement that we filed with the Securities and Exchange
Commission, or the Commission, utilizing a “shelf” registration process. Under
this shelf registration process, we may offer to sell the securities described
in this prospectus in one or more offerings up to a total dollar amount of
$20,000,000. This prospectus also relates to the offer and sale from time to
time of up to 15,000,000 shares of our common stock in one or more offerings by
the selling stockholder identified in this prospectus. This prospectus provides
you with a general description of the securities we or the selling stockholders
may offer. We may add to or modify in a prospectus supplement any of the
information contained in this prospectus or in the documents that we have
incorporated into this prospectus by reference. To the extent that any statement
made in a prospectus supplement conflicts with statements made in this
prospectus, the statements made in the prospectus supplement will be deemed to
modify or supersede those made in this prospectus. Each time we sell securities
under this shelf registration, we will provide a prospectus supplement that will
contain specific information about the terms of that offering. You should read
both this prospectus and any prospectus supplement, including all documents
incorporated herein or therein by reference, together with additional
information described under “Where You Can Find More Information and
Incorporation by Reference.”
We have not authorized any dealer,
salesman or other person to give any information or to make any representation
other than those contained or incorporated by reference in this prospectus and
the accompanying prospectus supplement. You must not rely upon any information
or representation not contained or incorporated by reference in this prospectus
or the accompanying prospectus supplement. This prospectus and the accompanying
prospectus supplement do not constitute an offer to sell or the solicitation of
an offer to buy any securities other than the registered securities to which
they relate, nor does this prospectus and the accompanying prospectus supplement
constitute an offer to sell or the solicitation of an offer to buy securities in
any jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. You should not assume that the information
contained in this prospectus and the accompanying prospectus supplement is
accurate on any date subsequent to the date set forth on the front of the
document or that any information we have incorporated by reference is correct on
any date subsequent to the date of the document incorporated by reference, even
though this prospectus and any accompanying prospectus supplement is delivered
or securities are sold on a later date.
In this prospectus, “we,” “us,” “our”
and “Neoprobe” refer to Neoprobe Corporation and its subsidiaries.
ABOUT
NEOPROBE CORPORATION
Neoprobe Corporation is a biomedical
technology company that provides innovative surgical and diagnostic oncology
products that enhance patient care and improve patient outcome. We currently
market a line of medical devices, our neoprobe® GDS
gamma detection systems, that are used in a cancer staging procedure called
intraoperative lymphatic mapping. In addition to our medical device products, we
have two radiopharmaceutical products, Lymphoseek® and
RIGScanTM CR, in
advanced phases of clinical development. We are also exploring the development
of our activated cellular therapy (ACT) technology for patient-specific disease
treatment through our majority-owned subsidiary, Cira Biosciences, Inc. (Cira
Bio).
We were originally incorporated in Ohio
in 1983 and reincorporated in Delaware in 1988. Our executive offices are
located at 425 Metro Place North, Suite 300, Dublin, Ohio 43017. Our telephone
number is (614) 793-7500. Our corporate website is
www.neoprobe.com. This reference to
our website is a textual reference only. We do not incorporate the information
on our website into this prospectus and you should not consider any information
on, or that can be accessed through, our website as part of this
prospectus.
RISK
FACTORS
An investment in our common stock
involves a high degree of risk. You should carefully consider the risks
described below, together with all of the other information included in this
prospectus, before making an investment decision. If any of the following risks
actually occurs, our business, financial condition or results of operations
could suffer. In that case, the trading price of our common stock could decline,
and you may lose all or part of your investment.
We
have suffered significant operating losses for several years in our history and
we may not be able to again achieve profitability.
We had an
accumulated deficit of approximately $195 million and had an overall deficit in
stockholders’ equity as of March 31, 2010. Although we were profitable in 2000
and 2001, we incurred substantial losses in the years prior to that, and again
in subsequent years. The deficit resulted because we expended more money in the
course of researching, developing and enhancing our technology and products and
establishing our marketing and administrative organizations than we generated in
revenues, and because of the significant non-cash losses we have recognized
related to accounting for certain of the complex financial instruments we have
issued in recent years to fund our business. We expect to continue to incur
significant expenses in the foreseeable future, primarily related to the
completion of development and commercialization of Lymphoseek, but also
potentially related to RIGS and our device product lines. As a result, we are
sustaining substantial operating and net losses, and it is possible that we will
never be able to sustain or develop the revenue levels necessary to again attain
profitability.
Our
products and product candidates may not achieve the broad market acceptance they
need in order to be a commercial success.
Widespread
use of our handheld gamma detection devices is currently limited to one surgical
procedure, sentinel lymph node biopsy (SLNB), used in the diagnosis and
treatment of two primary types of cancer: melanoma and breast cancer. While the
adoption of SLNB within the breast and melanoma indications appears to be
widespread, we believe expansion of SLNB to other indications such as head and
neck, colorectal and prostate cancers is likely dependent on a better lymphatic
tissue targeting agent than is currently available. Without expanded indications
in which to apply SLNB, it is likely that gamma detection devices will
eventually reach market saturation. Our efforts and those of our marketing and
distribution partners may not result in significant demand for our products, and
the current demand for our products may decline.
Our
radiopharmaceutical product candidates, Lymphoseek and RIGScan CR, are still in
the process of development, and even if we are successful in commercializing
them, we cannot assure you that they will obtain significant market
acceptance.
We
may have difficulty raising additional capital, which could deprive us of
necessary resources.
We expect
to continue to devote significant capital resources to fund research and
development and to maintain existing and secure new manufacturing capacity. In
order to support the initiatives envisioned in our business plan, we may need to
raise additional funds through the sale of assets, public or private debt or
equity financing, collaborative relationships or other arrangements. Our ability
to raise additional financing depends on many factors beyond our control,
including the state of capital markets, the market price of our common stock and
the development or prospects for development of competitive technology by
others. Because our common stock is not listed on a major stock market, many
investors may not be willing or allowed to purchase it or may demand steep
discounts. Sufficient additional financing may not be available to us or may be
available only on terms that would result in further dilution to the current
owners of our common stock.
We
believe that we have access to sufficient financial resources with which to fund
our operations or those of our subsidiaries for the foreseeable future.
Depending on market conditions and/or changes in our business plans, we may
raise capital in coming quarters under this registration statement or we may
consider other funding vehicles. The continuation of the depressed worldwide
financial conditions and stock market valuations may adversely affect our
ability to raise additional capital, either under facilities in place or from
new sources of capital. If we are unsuccessful in raising additional capital,
closing on financing under already agreed to terms, or the terms of raising such
capital are unacceptable, we may have to modify our business plan and/or
significantly curtail our planned development activities and other
operations.
In
December 2006, we entered into a common stock purchase agreement with Fusion
Capital, an Illinois limited liability company, to sell $6.0 million of our
common stock over a 24-month period which ended on November 21, 2008. Through
November 21, 2008, we sold to Fusion Capital under the agreement 7,568,671
shares for proceeds of $1.9 million. In December 2008, we entered into an
amendment to the agreement which gave us a right to sell an additional $6.0
million of our common stock to Fusion Capital before March 1, 2011, along with
the $4.1 million of the unsold balance of the $6.0 million we originally had the
right to sell to Fusion Capital under the original agreement. In March 2010, we
sold to Fusion Capital under the amended agreement 540,541 shares for proceeds
of $1.0 million. Subsequent to this sale, the remaining aggregate amount of our
common stock we can sell to Fusion Capital is $9.1 million, and we have reserved
a total of 10,113,459 shares of our common stock for sale under the amended
agreement. Our right to make sales under the amended agreement is limited to
$50,000 every two business days, unless our stock price equals or exceeds $0.30
per share, in which case we can sell greater amounts to Fusion Capital as the
price of our common stock increases. Fusion Capital does not have the right or
any obligation to purchase any shares on any business day that the market price
of our common stock is less than $0.20 per share. Assuming all 10,113,459 shares
are sold, the selling price per share would have to average approximately $0.90
for us to receive the full $9.1 million remaining proceeds under the agreement
as amended. Assuming we sell to Fusion Capital all 10,113,459 shares at a sale
price of $2.09 per share (the closing sale price of the common stock on July 30,
2010), we would receive the full remaining $9.1 million under the agreement.
Under the agreement, we have the right but not the obligation to sell more than
the 10,113,459 shares to Fusion Capital. As of the date hereof, we do not
currently have any plans or intent to sell to Fusion Capital any shares beyond
the 10,113,459 shares. However, if we elect to sell more than the 10,113,459
shares, we must first register any additional shares we may elect to sell to
Fusion Capital under the Securities Act before we can sell such additional
shares.
The
extent to which we rely on Fusion Capital as a source of funding will depend on
a number of factors, including the prevailing market price of our common stock
and the extent to which we are able to secure working capital from other
sources, such as through the sale of our products. To the extent that we are
unable to make sales to Fusion Capital to meet our capital needs, or to the
extent that we decide not to make such sales because of excessive dilution or
other reasons, and if we are unable to generate sufficient revenues from sales
of our products, we will need to secure another source of funding in order to
satisfy our working capital needs. Even if we are able to access the full $9.1
million potentially remaining under the agreement with Fusion Capital, we may
still need additional capital to fully implement our business, operating and
development plans. Should the financing we require to sustain our working
capital needs be unavailable or prohibitively expensive when we require it, the
consequences could be a material adverse effect on our business, operating
results, financial condition and prospects.
Clinical
trials for our radiopharmaceutical product candidates will be lengthy and
expensive and their outcome is uncertain.
Before
obtaining regulatory approval for the commercial sale of any product candidates,
we must demonstrate through preclinical testing and clinical trials that our
product candidates are safe and effective for use in humans. Conducting clinical
trials is a time consuming, expensive and uncertain process and may take years
to complete. During 2009, we successfully completed a Phase 3 clinical trial in
patients with breast cancer or melanoma for our most advanced
radiopharmaceutical product candidate, Lymphoseek. We began enrolling clinical
subjects in a second Phase 3 trial for Lymphoseek in patients with head and neck
squamous cell carcinoma in the third quarter of 2009 and in a third Phase 3
trial in subjects with breast cancer and melanoma in the third quarter of 2010.
While neither the second or third trials are required to be completed in order
to file our new drug application (NDA) for Lymphoseek, these trials are intended
to contribute additional data for safety evaluation purposes and to support
expanded post-marketing product labeling for Lymphoseek. In late 2008, we
obtained approval from the European Medicines Agency (EMEA) for a Phase 3
clinical protocol for our next radiopharmaceutical candidate, RIGScan CR, and we
are preparing to approach FDA to obtain similar clearance. Historically, the
results from preclinical testing and early clinical trials have often not been
predictive of results obtained in later clinical trials. Frequently, drugs that
have shown promising results in preclinical or early clinical trials
subsequently fail to establish sufficient safety and efficacy data necessary to
obtain regulatory approval. At any time during the clinical trials, we, the
participating institutions, FDA or EMEA might delay or halt any clinical trials
for our product candidates for various reasons, including:
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ineffectiveness
of the product candidate;
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discovery
of unacceptable toxicities or side
effects;
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development
of disease resistance or other physiological
factors;
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delays
in patient enrollment; or
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other
reasons that are internal to the businesses of our potential collaborative
partners, which reasons they may not share with
us.
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While we
have achieved some level of success in our recent Phase 2 and Phase 3 clinical
trials for Lymphoseek, the results of these clinical trials, as well as pending
and future trials, are subject to review and interpretation by various
regulatory bodies during the regulatory review process and may ultimately fail
to demonstrate the safety or effectiveness of our product candidates to the
extent necessary to obtain regulatory approval or such that commercialization of
our product candidates is worthwhile. Any failure or substantial delay in
successfully completing clinical trials and obtaining regulatory approval for
our product candidates could severely harm our business.
If
we fail to obtain collaborative partners, or those we obtain fail to perform
their obligations or discontinue clinical trials for particular product
candidates, our ability to develop and market potential products could be
severely limited.
Our
strategy for the development and commercialization of our product candidates
depends, in large part, upon the formation of collaborative arrangements.
Collaborations may allow us to:
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generate
cash flow and revenue;
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offset
some of the costs associated with our internal research and development,
preclinical testing, clinical trials and
manufacturing;
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seek
and obtain regulatory approvals faster than we could on our own;
and
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successfully
commercialize existing and future product
candidates.
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We have
an agreement in place with Cardinal Health for the distribution of Lymphoseek in
the United States. We do not currently have collaborative agreements covering
Lymphoseek in other areas of the world or for RIGScan CR or ACT. We cannot
assure you that we will be successful in securing collaborative partners for
other markets or radiopharmaceutical products, or that we will be able to
negotiate acceptable terms for such arrangements. The development, regulatory
approval and commercialization of our product candidates will depend
substantially on the efforts of collaborative partners, and if we fail to secure
or maintain successful collaborative arrangements, or if our partners fail to
perform their obligations, our development, regulatory, manufacturing and
marketing activities may be delayed, scaled back or suspended.
We
rely on third parties for the worldwide marketing and distribution of our gamma
detection devices, who may not be successful in selling our
products.
We
currently distribute our gamma detection devices in most global markets through
partners who are solely responsible for marketing and distributing these
products. The partners assume direct responsibility for business risks related
to credit, currency exchange, foreign tax laws or tariff and trade regulation.
For the past ten years, our primary marketing and distribution partner for our
gamma detection devices has been Ethicon Endo-Surgery, Inc. (EES), a Johnson
& Johnson company. Recently, EES sold its breast care franchise, the group
that is responsible for selling our gamma detection devices, to Devicor Medical
Products, Inc. (Devicor). While we believe that Devicor as our distribution
partner intends to continue to aggressively market our products, we cannot
assure you that the distribution partner will succeed in marketing our products
on a global basis. We may not be able to maintain satisfactory arrangements with
our marketing and distribution partners, who may not devote adequate resources
to selling our products. If this happens, we may not be able to successfully
market our products, which would decrease our revenues.
Our
radiopharmaceutical product candidates are subject to extensive government
regulations and we may not be able to obtain necessary regulatory
approvals.
We may
not receive the regulatory approvals necessary to commercialize our Lymphoseek
and RIGScan product candidates, which could cause our business to be severely
harmed. Our product candidates are subject to extensive and rigorous government
regulation. FDA regulates, among other things, the development, testing,
manufacture, safety, record-keeping, labeling, storage, approval, advertising,
promotion, sale and distribution of pharmaceutical products. If our potential
products are marketed abroad, they will also be subject to extensive regulation
by foreign governments. None of our radiopharmaceutical product candidates have
been approved for sale in the United States or in any foreign market. The
regulatory review and approval process, which includes preclinical studies and
clinical trials of each product candidate, is lengthy, complex, expensive and
uncertain. Securing FDA clearance to market requires the submission of extensive
preclinical and clinical data and supporting information to FDA for each
indication to establish the product candidate's safety and efficacy. Data
obtained from preclinical and clinical trials are susceptible to varying
interpretation, which may delay, limit or prevent regulatory approval. The
approval process may take many years to complete and may involve ongoing
requirements for post-marketing studies. In light of the limited regulatory
history of monoclonal antibody-based therapeutics, regulatory approvals for our
products may not be obtained without lengthy delays, if at all. Any FDA or other
regulatory approvals of our product candidates, once obtained, may be withdrawn.
The effect of government regulation may be to:
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delay
marketing of potential products for a considerable period of
time;
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limit
the indicated uses for which potential products may be
marketed;
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impose
costly requirements on our activities;
and
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provide
competitive advantage to other pharmaceutical and biotechnology
companies.
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We may
encounter delays or rejections in the regulatory approval process because of
additional government regulation from future legislation or administrative
action or changes in FDA policy during the period of product development,
clinical trials and FDA regulatory review. Failure to comply with applicable FDA
or other regulatory requirements may result in criminal prosecution, civil
penalties, recall or seizure of products, total or partial suspension of
production or injunction, as well as other regulatory action against our product
candidates or us. Outside the United States, our ability to market a product is
contingent upon receiving clearances from the appropriate regulatory
authorities. This foreign regulatory approval process includes risks similar to
those associated with FDA approval process.
Our
radiopharmaceutical product candidates will remain subject to ongoing regulatory
review even if they receive marketing approval. If we fail to comply with
continuing regulations, we could lose these approvals and the sale of our
products could be suspended.
Even if
we receive regulatory clearance to market a particular product candidate, the
approval could be conditioned on us conducting additional costly post-approval
studies or could limit the indicated uses included in our labeling. Moreover,
the product may later cause adverse effects that limit or prevent its widespread
use, force us to withdraw it from the market or impede or delay our ability to
obtain regulatory approvals in additional countries. In addition, the
manufacturer of the product and its facilities will continue to be subject to
FDA review and periodic inspections to ensure adherence to applicable
regulations. After receiving marketing clearance, the manufacturing, labeling,
packaging, adverse event reporting, storage, advertising, promotion and
record-keeping related to the product will remain subject to extensive
regulatory requirements. We may be slow to adapt, or we may never adapt, to
changes in existing regulatory requirements or adoption of new regulatory
requirements.
If we
fail to comply with the regulatory requirements of FDA and other applicable U.S.
and foreign regulatory authorities or previously unknown problems with our
products, manufacturers or manufacturing processes are discovered, we could be
subject to administrative or judicially imposed sanctions,
including:
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restrictions
on the products, manufacturers or manufacturing
processes;
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civil
or criminal penalties;
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product
seizures or detentions;
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voluntary
or mandatory product recalls and publicity
requirements;
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suspension
or withdrawal of regulatory
approvals;
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total
or partial suspension of production;
and
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refusal
to approve pending applications for marketing approval of new drugs or
supplements to approved
applications.
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Our
existing products are highly regulated and we could face severe problems if we
do not comply with all regulatory requirements in the global markets in which
these products are sold.
FDA
regulates our gamma detection products in the United States. Foreign countries
also subject these products to varying government regulations. In addition,
these regulatory authorities may impose limitations on the use of our products.
FDA enforcement policy strictly prohibits the marketing of FDA cleared medical
devices for unapproved uses. Within the European Union, our products are
required to display the CE Mark in order to be sold. We have obtained FDA
clearance to market and European certification to display the CE Mark on our
current line of gamma detection systems. We may not be able to obtain clearance
to market any new products in a timely manner, or at all. Failure to comply with
these and other current and emerging regulatory requirements in the global
markets in which our products are sold could result in, among other things,
warning letters, fines, injunctions, civil penalties, recall or seizure of
products, total or partial suspension of production, refusal of the government
to grant pre-market clearance for devices, withdrawal of clearances, and
criminal prosecution.
We
rely on third parties to manufacture our medical device products and our
business will suffer if they do not perform.
We rely
on independent contract manufacturers for the manufacture of our current
neoprobe GDS line of gamma detection systems. Our business will suffer if our
contract manufacturers have production delays or quality problems. Furthermore,
medical device manufacturers are subject to the quality system regulations of
FDA, international quality standards, and other regulatory requirements. If our
contractors do not operate in accordance with regulatory requirements and
quality standards, our business will suffer. We use or rely on components and
services used in our devices that are provided by sole source suppliers. The
qualification of additional or replacement vendors is time consuming and costly.
If a sole source supplier has significant problems supplying our products, our
sales and revenues will be hurt until we find a new source of supply. In
addition, our distribution agreement with Devicor for our gamma detection
devices contains failure to supply provisions, which, if triggered, could have a
significant negative impact on our business.
We
may be unable to establish the pharmaceutical manufacturing capabilities
necessary to develop and commercialize our potential products.
We do not
have our own manufacturing facility for the manufacture of the
radiopharmaceutical compounds necessary for clinical testing or commercial sale.
We intend to rely on third-party contract manufacturers to produce sufficiently
large quantities of drug materials that are and will be needed for clinical
trials and commercialization of our potential products. Third-party
manufacturers may not be able to meet our needs with respect to timing, quantity
or quality of materials. We have completed a supply agreement with Reliable
Biopharmaceuticals covering the manufacturing of the active pharmaceutical
ingredient in Lymphoseek and we are in the process of finalizing supply
contracts with another third-party manufacturer for the lyophoization, vialing
and filling of the finished Lymphoseek product. However, if we are unable to
contract for a sufficient supply of needed materials on acceptable terms, or if
we should encounter delays or difficulties in our relationships with
manufacturers, our clinical trials may be delayed, thereby delaying the
submission of product candidates for regulatory approval and the market
introduction and subsequent commercialization of our potential products. Any
such delays may lower our revenues and potential profitability.
We and
any third-party manufacturers that we may use must continually adhere to current
Good Manufacturing Practices regulations enforced by FDA through its facilities
inspection program. If our facilities or the facilities of third-party
manufacturers cannot pass a pre-approval plant inspection, FDA will not grant
approval to our product candidates. In complying with these regulations and
foreign regulatory requirements, we and any of our third-party manufacturers
will be obligated to expend time, money and effort on production, record-keeping
and quality control to assure that our potential products meet applicable
specifications and other requirements. If we or any third-party manufacturer
with whom we may contract fail to maintain regulatory compliance, we or the
third party may be subject to fines and/or manufacturing operations may be
suspended.
Unfavorable
pricing regulations, third-party reimbursement practices or healthcare reform
initiatives applicable to our radiopharmaceutical products and product
candidates could limit our potential product revenue and adversely affect our
business.
The
regulations governing drug pricing and reimbursement vary widely from country to
country. Some countries require approval of the sale price of a drug before it
can be marketed and, in many of these countries, the pricing review period
begins only after approval is granted. In some countries, prescription
pharmaceutical pricing remains subject to continuing governmental control even
after initial approval is granted. Although we monitor these regulations, our
product candidates are currently in the development stage and we will not be
able to assess the impact of price regulations for at least several years. As a
result, we may obtain regulatory approval for a product in a particular country,
but then be subject to price regulations that may delay the commercial launch of
the product and may negatively impact the revenues we are able to derive from
sales in that country.
The
healthcare industry is undergoing fundamental changes resulting from political,
economic and regulatory influences. In the United States, comprehensive programs
have been proposed that seek to increase access to healthcare for the uninsured,
to control the escalation of healthcare expenditures within the economy and to
use healthcare reimbursement policies to balance the federal budget. On March
23, 2010, health reform legislation was approved by Congress and has been signed
into law. The reform legislation provides that most individuals must have health
insurance, will establish new regulations on health plans, create insurance
pooling mechanisms and other expanded public health care measures, and impose
new taxes on sales of medical devices and pharmaceuticals. Since this
legislation was recently enacted and will require the adoption of implementing
regulations, we cannot predict the effect, if any, that it will have on our
business, but this legislation and similar federal and state initiatives may
have the effect of lowering reimbursements for our products, reducing medical
procedure volumes, increasing our taxes and otherwise adversely affect our
business, possibly materially.
We expect
that Congress and state legislatures will continue to review and assess
healthcare proposals, and public debate of these issues will likely continue. We
cannot predict which, if any, of such reform proposals will be adopted and when
they might be adopted. Other countries also are considering healthcare reform.
Significant changes in healthcare systems could have a substantial impact on the
manner in which we conduct our business and could require us to revise our
strategies.
The sale of our common
stock to Fusion may cause dilution and the sale of common stock acquired by
Fusion could cause the price of our common stock to decline.
In
connection with our agreement with Fusion Capital, we have authorized the sale
of up to 18,222,671 shares of our common stock and the issuance of 1,800,000
shares in commitment fees, and we have filed a registration statement with the
SEC for the sale to the public of 11,500,000 shares issuable to Fusion Capital
pursuant to the agreement. Through July 30, 2010, we have sold Fusion Capital
8,109,212 shares of common stock and issued 1,434,000 shares of stock as
commitment fees to Fusion Capital. The number of shares ultimately offered for
sale to the public will be dependent upon the number of shares purchased by
Fusion Capital under the agreement. It is anticipated that these shares will be
sold over a period of up to 26 months from the date of the December 24, 2008
amendment to the agreement, at prices that will fluctuate based on changes in
the market price of our common stock over that period. Depending upon market
liquidity at the times sales are made, these sales could cause the market price
of our common stock to decline. Consequently, sales to Fusion Capital may result
in substantial dilution to the interests of other holders of our common stock.
The sale of a substantial number of shares of our common stock by Fusion
Capital, or anticipation of such sales, could make it more difficult for us to
sell equity or equity-related securities in the future at a time and at a price
that we might otherwise wish to effect sales. However, we have the right to
control the timing and amount of any sales of our shares to Fusion Capital and
the agreement may be terminated by us at any time at our discretion without any
cost to us.
The
sale of the shares of common stock acquired in private placements could cause
the price of our common stock to decline.
Over the
past few years, we completed various financings in which we issued common stock,
convertible notes, warrants and other securities convertible into common stock
to certain private investors. The terms of these transactions require that we
file registration statements with the Securities and Exchange Commission under
which the investors may resell to the public common stock acquired in these
transactions, as well as common stock acquired on the exercise of the warrants
and convertible securities held by them. Further, some or all of the common
stock sold in these transactions may become eligible for resale without
registration under the provisions of Rule 144, upon satisfaction of the holding
period and other requirements of the Rule.
As
required by our financing arrangements with Fusion Capital, we have filed a
registration statement registering for resale a total of 11,500,000 common
shares, consisting of (i) 10,654,000 shares which we may sell to Fusion Capital
pursuant to the amended common stock purchase agreement, (ii) 360,000 shares
issued to Fusion Capital in consideration for its agreement to the amendment;
and (iii) 486,000 commitment fee shares to be issued pro rata as we sell the
first $4.1 million of common stock under the amended agreement. The number of
shares ultimately sold under the registration statement will be dependent upon
the number of shares purchased by Fusion Capital under the amended agreement. It
is anticipated that these shares will be sold from time to time over a period
ending on March 1, 2011, at prices that will fluctuate based on changes in the
market price of our common stock over that period. We have the right to control
the timing and amount of any sales of our shares to Fusion Capital and the
agreement may be terminated by us at any time at our discretion without any cost
to us.
On
December 26, 2007, we entered into a Securities Purchase Agreement (SPA) with
Platinum-Montaur Life Sciences, LLC (Montaur), pursuant to which we issued
Montaur a 10% Series A Convertible Senior Secured Promissory Note in the
principal amount of $7,000,000, due December 26, 2011 (the Series A Note) and a
five-year Series W Warrant to purchase 6,000,000 shares of our common stock at
an exercise price of $0.32 per share. On April 16, 2008, following receipt by
the Company of clearance by the FDA to commence a Phase 3 clinical trial for
Lymphoseek in patients with breast cancer or melanoma, we amended the SPA and
issued Montaur a 10% Series B Convertible Senior Secured Promissory Note in the
principal amount of $3,000,000, also due December 26, 2011 (the Series B Note,
and hereinafter referred to collectively with the Series A Note as the Montaur
Notes), and a five-year Series X Warrant to purchase 8,333,333 shares of our
common stock at an exercise price of $0.46 per share. On December 5, 2008, after
the Company had obtained 135 vital blue dye lymph nodes from patients who had
completed surgery and the injection of the drug in the Phase 3 clinical trial of
Lymphoseek in patients with breast cancer or melanoma, we issued Montaur 3,000
shares of our 8% Series A Cumulative Convertible Preferred Stock (the Series A
Preferred Stock) and a five-year Series Y Warrant (hereinafter referred to
collectively with the Series W Warrant and Series X Warrant as the Montaur
Warrants) to purchase 6,000,000 shares of our common stock, at an exercise price
of $0.575 per share, also for an aggregate purchase price of $3,000,000. On July
24, 2009, we entered into a Securities Amendment and Exchange Agreement
(Amendment Agreement) with Montaur, pursuant to which Montaur agreed to the
amendment and restatement of the terms of the Montaur Notes, the Montaur
Warrants and the Preferred Stock, to remove price-based anti-dilution adjustment
provisions that had created a significant non-cash derivative liability on the
Company’s balance sheet, and upon the surrender of the Montaur Notes and the
Montaur Warrants we issued Montaur an Amended and Restated 10% Series A
Convertible Senior Secured Promissory Note in the principal amount of
$7,000,000, due December 26, 2011 (the Amended Series A Note), an Amended and
Restated 10% Series B Convertible Senior Secured Promissory Note in the
principal amount of $3,000,000, due December 26, 2011 (the Amended Series B
Note, and together with the Amended Series A Note the Amended Montaur Notes), an
Amended and Restated Series W Warrant (the Amended Series W Warrant), an Amended
and Restated Series X Warrant (the Amended Series X Warrant), an Amended and
Restated Series Y Warrant (the Amended Series Y Warrant), and in consideration
for the agreement of Montaur to enter into the Amendment Agreement, a Series AA
Warrant to purchase 2,400,000 shares of our common stock at an exercise price of
$0.97 per share (the Series AA Warrant, and together with the Amended Series W
Warrant, Amended Series X Warrant and Amended Series Y Warrant, the Amended
Montaur Warrants). On June 22, 2010, we
entered into a Securities Exchange Agreement (the Exchange Agreement) with
Montaur, pursuant to which Montaur delivered to the Company for cancellation and
retirement: (1) the Amended Montaur Notes; and (2) the Series A Preferred Stock,
in exchange for 10,000 shares of our Series B Convertible Preferred Stock
(Series B Preferred Stock). Pursuant to the provisions of the Certificate
of Designations, Voting Powers, Preferences, Limitations, Restrictions, and
Relative Rights of the Series B Convertible Preferred Stock, Montaur may convert
all or any portion of the shares of the Series B Preferred Stock into an
aggregate 32,700,000 shares of our common stock, subject to adjustment as
described in the Certificate of Designations.
Montaur
may sell none, some or all of the shares of common stock acquired from us, as
well as common stock acquired on the exercise of the warrants and convertible
securities held by them. We have no way of knowing whether or when Montaur will
sell these shares. Depending upon market liquidity at the time, a sale of these
shares at any given time could cause the trading price of our common stock to
decline. The sale of a substantial number of shares of our common stock, or
anticipation of such sales, could make it more difficult for us to sell equity
or equity-related securities in the future at a time and at a price that we
might otherwise wish to effect sales.
We
may lose out to larger and better-established competitors.
The
medical device and biotechnology industries are intensely competitive. Some of
our competitors have significantly greater financial, technical, manufacturing,
marketing and distribution resources as well as greater experience in the
medical device industry than we have. The particular medical conditions our
product lines address can also be addressed by other medical devices, procedures
or drugs. Many of these alternatives are widely accepted by physicians and have
a long history of use. Physicians may use our competitors’ products and/or our
products may not be competitive with other technologies. If these things happen,
our sales and revenues will decline. In addition, our current and potential
competitors may establish cooperative relationships with large medical equipment
companies to gain access to greater research and development or marketing
resources. Competition may result in price reductions, reduced gross margins and
loss of market share.
Our
products may be displaced by newer technology.
The
medical device and biotechnology industries are undergoing rapid and significant
technological change. Third parties may succeed in developing or marketing
technologies and products that are more effective than those developed or
marketed by us, or that would make our technology and products obsolete or
non-competitive. Additionally, researchers could develop new surgical procedures
and medications that replace or reduce the importance of the procedures that use
our products. Accordingly, our success will depend, in part, on our ability to
respond quickly to medical and technological changes through the development and
introduction of new products. We may not have the resources to do this. If our
products become obsolete and our efforts to develop new products do not result
in any commercially successful products, our sales and revenues will
decline.
We
may not have sufficient legal protection against infringement or loss of our
intellectual property, and we may lose rights to our licensed intellectual
property if diligence requirements are not met.
Our
success depends, in part, on our ability to secure and maintain patent
protection, to preserve our trade secrets, and to operate without infringing on
the patents of third parties. While we seek to protect our proprietary positions
by filing United States and foreign patent applications for our important
inventions and improvements, domestic and foreign patent offices may not issue
these patents. Third parties may challenge, invalidate, or circumvent our
patents or patent applications in the future. Competitors, many of which have
significantly more resources than we have and have made substantial investments
in competing technologies, may apply for and obtain patents that will prevent,
limit, or interfere with our ability to make, use, or sell our products either
in the United States or abroad.
In the
United States, patent applications are secret until patents are issued, and in
foreign countries, patent applications are secret for a time after filing.
Publications of discoveries tend to significantly lag the actual discoveries and
the filing of related patent applications. Third parties may have already filed
applications for patents for products or processes that will make our products
obsolete or will limit our patents or invalidate our patent
applications.
We
typically require our employees, consultants, advisers and suppliers to execute
confidentiality and assignment of invention agreements in connection with their
employment, consulting, advisory, or supply relationships with us. They may
breach these agreements and we may not obtain an adequate remedy for breach.
Further, third parties may gain access to our trade secrets or independently
develop or acquire the same or equivalent information.
Agencies
of the United States government conducted some of the research activities that
led to the development of antibody technology that some of our proposed
antibody-based surgical cancer detection products use. When the United States
government participates in research activities, it retains rights that include
the right to use the technology for governmental purposes under a royalty-free
license, as well as rights to use and disclose technical data that could
preclude us from asserting trade secret rights in that data and
software.
We
may lose the license rights to certain in-licensed products if we do not
exercise adequate diligence.
Our
license agreements for Lymphoseek, RIGS, and ACT contain provisions that require
that we demonstrate ongoing diligence in the continuing research and development
of these potential products. Cira Bio’s rights to certain applications of the
ACT technology may be affected by its failure to achieve certain capital raising
milestones although no such notices to that effect have been received to date.
We have provided information, as required or requested, to the licensors of our
technology indicating the steps we have taken to demonstrate our diligence and
believe we are adequately doing so to meet the terms and/or intent of our
license agreements. However, it is possible that the licensors may not consider
our actions adequate in demonstrating such diligence. Should we fail to
demonstrate the requisite diligence required by any such agreements or as
interpreted by the respective licensors, we may lose our development and
commercialization rights for the associated product.
We
could be damaged by product liability claims.
Our
products are used or intended to be used in various clinical or surgical
procedures. If one of our products malfunctions or a physician misuses it and
injury results to a patient or operator, the injured party could assert a
product liability claim against our Company. We currently have product liability
insurance with a $10 million per occurrence limit, which we believe is adequate
for our current activities. However, we may not be able to continue to obtain
insurance at a reasonable cost. Furthermore, insurance may not be sufficient to
cover all of the liabilities resulting from a product liability claim, and we
might not have sufficient funds available to pay any claims over the limits of
our insurance. Because personal injury claims based on product liability in a
medical setting may be very large, an underinsured or an uninsured claim could
financially damage our Company.
We
may have difficulty attracting and retaining qualified personnel and our
business may suffer if we do not.
Our
business has experienced a number of successes and faced several challenges in
recent years that have resulted in several significant changes in our strategy
and business plan, including the shifting of resources to support our current
product initiatives. Our management will need to remain flexible to support our
business model over the next few years. However, losing members of the Neoprobe
management team could have an adverse effect on our operations. Our success
depends on our ability to attract and retain technical and management personnel
with expertise and experience in the medical device business. The competition
for qualified personnel in the biotechnology industry is intense and we may not
be successful in hiring or retaining the requisite personnel. If we are unable
to attract and retain qualified technical and management personnel, we will
suffer diminished chances of future success.
Our
common stock is traded over the counter, which may deprive stockholders of the
full value of their shares.
Our
common stock is quoted via the OTC Bulletin Board (OTCBB). As such, our common
stock may have fewer market makers, lower trading volumes and larger spreads
between bid and ask prices than securities listed on an exchange such as the New
York Stock Exchange or the NASDAQ Stock Market. These factors may result in
higher price volatility and less market liquidity for the common
stock.
A
low market price may severely limit the potential market for our common
stock.
Our
common stock is currently trading at a price substantially below $5.00 per
share, subjecting trading in the stock to certain SEC rules requiring additional
disclosures by broker-dealers. These rules generally apply to any non-NASDAQ
equity security that has a market price share of less than $5.00 per share,
subject to certain exceptions (a "penny stock"). Such rules require the
delivery, prior to any penny stock transaction, of a disclosure schedule
explaining the penny stock market and the risks associated therewith and impose
various sales practice requirements on broker-dealers who sell penny stocks to
persons other than established customers and institutional or wealthy investors.
For these types of transactions, the broker-dealer must make a special
suitability determination for the purchaser and have received the purchaser's
written consent to the transaction prior to the sale. The broker-dealer also
must disclose the commissions payable to the broker-dealer, current bid and
offer quotations for the penny stock and, if the broker-dealer is the sole
market maker, the broker-dealer must disclose this fact and the broker-dealer's
presumed control over the market. Such information must be provided to the
customer orally or in writing before or with the written confirmation of trade
sent to the customer. Monthly statements must be sent disclosing recent price
information for the penny stock held in the account and information on the
limited market in penny stocks. The additional burdens imposed upon
broker-dealers by such requirements could discourage broker-dealers from
effecting transactions in our common stock.
The
price of our common stock has been highly volatile due to several factors that
will continue to affect the price of our stock.
Our
common stock traded as low as $0.95 per share and as high as $2.30 per share
during the 12-month period ended July 31, 2010. The market price of our common
stock has been and is expected to continue to be highly volatile. Factors,
including announcements of technological innovations by us or other companies,
regulatory matters, new or existing products or procedures, concerns about our
financial position, operating results, litigation, government regulation,
developments or disputes relating to agreements, patents or proprietary rights,
may have a significant impact on the market price of our stock. In addition,
potential dilutive effects of future sales of shares of common stock by the
Company and by stockholders, and subsequent sale of common stock by the holders
of warrants and options could have an adverse effect on the market price of our
shares.
Some
additional factors which could lead to the volatility of our common stock
include:
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price
and volume fluctuations in the stock market at large which do not relate
to our operating performance;
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financing
arrangements we may enter that require the issuance of a significant
number of shares in relation to the number of shares currently
outstanding;
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public
concern as to the safety of products that we or others develop;
and
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fluctuations
in market demand for and supply of our
products.
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An
investor’s ability to trade our common stock may be limited by trading
volume.
Generally,
the trading volume for our common stock has been relatively limited. A
consistently active trading market for our common stock may not occur on the
OTCBB. The average daily trading volume for our common stock on the OTCBB for
the 12-month period ended July 31, 2010 was approximately 125,000
shares.
Some
provisions of our organizational and governing documents may have the effect of
deterring third parties from making takeover bids for control of our Company or
may be used to hinder or delay a takeover bid.
Our
certificate of incorporation authorizes the creation and issuance of “blank
check” preferred stock. Our Board of Directors may divide this stock into one or
more series and set their rights. The Board of Directors may, without prior
stockholder approval, issue any of the shares of “blank check” preferred stock
with dividend, liquidation, conversion, voting or other rights, which could
adversely affect the relative voting power or other rights of the common stock.
Preferred stock could be used as a method of discouraging, delaying, or
preventing a take-over of our Company. If we issue “blank check” preferred
stock, it could have a dilutive effect upon our common stock. This would
decrease the chance that our stockholders would realize a premium over market
price for their shares of common stock as a result of a takeover
bid.
Because
we will not pay dividends in the foreseeable future, stockholders will only
benefit from owning common stock if it appreciates.
We have
never paid dividends on our common stock and we do not intend to do so in the
foreseeable future. We intend to retain any future earnings to finance our
growth. Accordingly, any potential investor who anticipates the need for current
dividends from his investment should not purchase our common stock.
SPECIAL NOTE REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus and the information
incorporated by reference in this prospectus contain forward-looking statements.
We sometimes use words such as “anticipate,” “believe,” “continue,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,”
“will” and similar expressions, as they relate to us, our management and our
industry, to identify forward-looking statements. Forward-looking statements
relate to our expectations, beliefs, plans, strategies, prospects, future
performance, anticipated trends and other future events. Specifically, this
prospectus and the information incorporated by reference in this prospectus
contain forward-looking statements relating to, among other things:
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our
primary operating costs and
expenses;
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evaluation
of possible acquisitions of, or investments in business, products and
technologies; and
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sufficiency
of existing cash to meet operating
requirements.
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These statements involve known and
unknown risks, uncertainties, and other factors that may cause our or our
industry’s past results, levels of activity, performance, or achievements to be
materially different from any future results, levels of activity, performance,
or achievements expressed or implied by such forward-looking statements. Actual
results may differ materially. Some of the risks, uncertainties and assumptions
that may cause actual results to differ from these forward-looking statements
are described in “Risk Factors” and elsewhere in this prospectus, and may also
be found in an accompanying prospectus supplement and in information
incorporated by reference.
You should read this prospectus, the
documents that we filed as exhibits to the registration statement of which this
prospectus is a part and the documents that we incorporate by reference in this
prospectus completely and with the understanding that our future results may be
materially different from what we expect. We qualify all of our forward-looking
statements by these cautionary statements, and we assume no obligation to update
these forward-looking statements publicly for any reason.
CAPITALIZATION
The
following table sets forth our other long-term assets, debt and capitalization
as of March 31, 2010, as follows:
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on
an actual basis; and
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on
a pro forma basis to give effect to the exchange of the Montaur Notes and
the Series A Preferred Stock for Series B Preferred Stock, and the
exchange of the Amended 10% Convertible Note in the principal amount of
$1,000,000, due December 31, 2011, executed by the Company in favor of
David C. Bupp, our President and CEO, and certain members of his family
(the Bupp Note), for Series C Preferred
Stock.
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The table
does not include the effect of the shares registered in this Registration
Statement as the shares registered are: (1) for a secondary offering by selling
shareholders; and (2) the sale of an undetermined number and amount of primary
shares.
|
|
|
March
31, 2010
Actual (Unaudited)
|
|
|
Adjustments
|
|
|
|
|
|
March 31, 2010
Pro Forma
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
assets
|
|
|
22,534 |
|
|
(13,061 |
) |
|
(1 |
)
|
|
|
9,473 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
3,422,520 |
|
|
- |
|
|
|
|
|
|
3,422,520 |
|
|
Long-term
liabilities
|
|
|
13,882,180 |
|
|
(11,923,791 |
) |
|
(1)(2)(3 |
)
|
|
|
1,958,389 |
|
|
Preferred
stock
|
|
|
3,000,000 |
|
|
(3,000,000 |
) |
|
(2 |
)
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
(deficit) equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred
stock
|
|
|
- |
|
|
11 |
|
|
(1)(2)(3 |
)
|
|
|
11 |
|
|
Common
stock
|
|
|
81,892 |
|
|
|
|
|
|
|
|
|
81,892 |
|
|
Additional
paid-in capital
|
|
|
184,096,762 |
|
|
64,666,789 |
|
|
(1)(2)(3 |
)
|
|
|
248,763,551 |
|
|
Accumulated
deficit
|
|
|
(195,218,800 |
) |
|
(49,756,070 |
) |
|
(1)(2)(3 |
)
|
|
|
(244,974,870 |
) |
|
Total
stockholders’
(deficit)
equity
|
|
|
(11,040,146 |
) |
|
14,910,730 |
|
|
|
|
|
|
3,870,584 |
|
|
Total
capitalization
|
|
$ |
9,264,554 |
|
|
|
|
|
|
|
|
$ |
9,251,493 |
|
|
|
(1)
|
As
a result of exchanging the Montaur Notes for Series B Preferred Stock, the
Company decreased other assets by $13,061 and long-term liabilities by
$10,750,000, and increased preferred stock by $8 and additional paid-in
capital by $47,605,302. The Company also increased accumulated deficit by
recognizing a loss on the extinguishment of the Montaur Notes of
$36,868,371.
|
|
|
(2)
|
As
a result of exchanging the Series A Preferred Stock for Series B Preferred
Stock, the Company decreased mezzanine preferred stock by $3,000,000 and
long-term liabilities by $216,000, and increased preferred stock by $2 and
additional paid-in capital by $11,254,688. The Company also increased
accumulated deficit by recognizing a deemed dividend on the Series A
Preferred Stock of $8,038,690.
|
|
|
(3)
|
As
a result of exchanging the Bupp Note for Series C Preferred Stock, the
Company decreased long-term liabilities by $957,791 and increased
preferred stock by $1 and additional paid-in capital by $5,806,799. The
Company also increased accumulated deficit by recognizing a loss on the
extinguishment of the Bupp Note of
$4,849,009.
|
WHERE
YOU CAN FIND MORE INFORMATION
AND
INCORPORATION BY REFERENCE
We have filed a registration statement
on Form S-3 with the Securities and Exchange Commission. This prospectus does
not contain all of the information in the registration statement. In addition,
we file annual, quarterly and special reports, proxy statements and other
information with the Commission. Our Commission filings are available to the
public over the Internet at the Commission’s web site at http://www.sec.gov. You
may also read and copy any document we file with the Commission at its public
reference facilities at 100 F Street, N.E., Washington, DC 20549. You can also
obtain copies of the documents at prescribed rates by writing to the Public
Reference Section of the Commission at 100 F Street, N.E., Washington, DC 20549.
Please call the Commission at 1-800-SEC-0330 for further information on the
operation of the public reference facilities.
We “incorporate by reference” into this
prospectus the information we file with the Commission (Commission file number
0-26520), which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus. Information that we file with the
Commission after the date of this prospectus will automatically update this
prospectus. We incorporate by reference the documents listed below, and any
filings we make with the Commission under Sections 13(a), 13(c), 14, or 15(d) of
the Securities Exchange Act of 1934 after the initial filing of the registration
statement that contains this prospectus (except for information furnished and
not filed with the Commission in a Current Report on Form 8-K):
|
|
·
|
our
Annual Report on Form 10-K for the year ended December 31, 2009, filed
with the Commission on March 31,
2010;
|
|
|
·
|
our
Quarterly Report on Form 10-Q for the quarterly period ended March 31,
2010, filed with the Commission on May 14,
2010;
|
|
|
·
|
our
Current Reports on Form 8-K, dated January 11, 2010 (filed January 11,
2010), dated January 26, 2010 (filed January 28, 2010), dated February 24,
2010 (filed February 26, 2010), dated March 11, 2010 (filed March 12,
2010), dated May 26, 2010 (filed May 27, 2010), dated June 22, 2010 (filed
June 28, 2010) and dated July 16, 2010 (filed July 20, 2010);
and
|
|
|
·
|
the
description of our common stock which is contained in our Form 8-A filed
with the Commission pursuant to Section 12 of the Securities Exchange Act
of 1934, as amended, as updated in any amendment or report filed for the
purpose of updating such
description.
|
Information furnished by us in Current
Reports on Form 8-K under Items 2.02 and 9.01 is expressly not incorporated by
reference in this prospectus.
We will provide to each person,
including any beneficial owner, to whom a prospectus is delivered, without
charge, upon written or oral request, a copy of any or all of the documents that
are incorporated by reference into this prospectus but not delivered with the
prospectus, including exhibits that are specifically incorporated by reference
into such documents. You may request a copy of these filings at no cost, by
writing to or telephoning us at:
Neoprobe
Corporation
Attn:
Brent L. Larson
425 Metro
Place North
Dublin,
Ohio 43017-1367
(614)
822-2330
USE
OF PROCEEDS
Unless otherwise indicated in the
prospectus supplement, we intend to use the net proceeds from the sale of
securities under this prospectus for general corporate purposes, which may
include additions to working capital, repayment or redemption of existing
indebtedness and financing capital expenditures and acquisitions. The prospectus
supplement relating to a particular offering of securities by us will identify
the use of proceeds for that offering. We will receive no proceeds from the sale
of securities by the selling stockholders.
DESCRIPTION
OF CAPITAL STOCK
The following description of our
capital stock is only a summary and is subject to the provisions of our amended
and restated certificate of incorporation, or certificate of incorporation, and
our amended and restated by-laws, or by-laws, which are included as exhibits to
the registration statement of which this prospectus forms a part, and provisions
of applicable law.
Our articles of incorporation authorize
our board of directors to issue 200,000,000 shares of common stock and 5,000,000
shares of preferred stock. As of July 31, 2010, 82,280,755 shares of common
stock were issued outstanding, and 11,000 shares of preferred stock were issued
and outstanding.
Common
Stock
Dividends
Each
share of common stock is entitled to receive an equal dividend, if one is
declared, which is unlikely. We have never paid dividends on our common stock
and do not intend to do so in the foreseeable future. We intend to retain any
future earnings to finance our growth. See Risk Factors.
Liquidation
If our
company is liquidated, any assets that remain after the creditors are paid, and
the owners of preferred stock receive any liquidation preferences, will be
distributed to the owners of our common stock pro-rata.
Voting
Rights
Each
share of our common stock entitles the owner to one vote. There is no cumulative
voting. A simple majority can elect all of the directors at a given meeting and
the minority would not be able to elect any directors at that
meeting.
Preemptive
Rights
Owners of
our common stock have no preemptive rights. We may sell shares of our common
stock to third parties without first offering it to current
stockholders.
Redemption
Rights
We do not
have the right to buy back shares of our common stock except in extraordinary
transactions such as mergers and court approved bankruptcy reorganizations.
Owners of our common stock do not ordinarily have the right to require us to buy
their common stock. We do not have a sinking fund to provide assets for any buy
back.
Conversion
Rights
Shares of
our common stock can not be converted into any other kind of stock except in
extraordinary transactions, such as mergers and court approved bankruptcy
reorganizations.
Preferred
Stock
Our
certificate of incorporation authorizes our board of directors to issue "blank
check" preferred stock. The board of directors may divide this stock into series
and set their rights. On December 26, 2007, the board of directors designated
3,000 shares of preferred stock as Series A 8% Cumulative Convertible Preferred
Stock. On December 5, 2008, we issued 3,000 shares of Series A 8% Cumulative
Convertible Preferred Stock (Series A Preferred Stock) to Montaur. On June 22,
2010, the board of directors designated 10,000 shares of preferred stock as
Series B Convertible Preferred Stock (Series B Preferred Stock), and 1,000
shares of preferred stock as Series C Convertible Preferred Stock (Series C
Preferred Stock). Also, on June 22, 2010: (1) Montaur surrendered the Amended
Series A Note and all 3,000 shares of Series A Preferred Stock issued to it on
December 5, 2008, in exchange for 10,000 shares of Series B Preferred Stock; and
(2) we issued 1,000 shares of Series C Preferred Stock to David C. Bupp, the
Company’s President and Chief Executive Officer, and Cynthia B. Gochoco, both
individually and as co-executors of the Estate of Walter H. Bupp (the Bupp
Investors). Montaur may convert all or any portion of the shares of
Series B Preferred Stock into an aggregate 32,700,000 shares of our common
stock, and the Bupp Investors may convert all or any portion of the shares of
Series C Preferred Stock into an aggregate 3,226,000 shares of our common
stock.
The board
of directors may, without prior stockholder approval, issue any of the remaining
4,989,000 shares of authorized preferred stock with dividend, liquidation,
conversion, voting or other rights which could adversely affect the relative
voting power or other rights of the common stock. Preferred stock could be used
as a method of discouraging, delaying, or preventing a take-over of our Company.
If we do issue preferred stock in the future, it could have a dilutive effect
upon the common stock. See Risk Factors.
We may
issue warrants for the purchase of common stock in one or more series. We may
issue warrants independently or together with common stock, and the warrants may
traded separate and apart from our common stock. Each series of warrants will be
issued under a warrant agreement, as described in the applicable prospectus
supplement. We urge you to read any applicable warrant agreements, because those
documents, and not these descriptions, define your rights as a holder of
warrants. A copy of the form of warrant agreement reflecting the provisions of
the warrants in a particular offering will be filed as an exhibit to a Current
Report on Form 8-K, to be incorporated into the registration statement of which
this prospectus constitutes a part prior to the issuance of any
warrants.
The
applicable prospectus supplement will describe the terms of the warrants offered
thereby and the warrant agreement relating to such warrants, including but not
limited to the following:
|
|
·
|
the
offering price or prices;
|
|
|
·
|
the
aggregate amount of common stock that may be purchased upon exercise of
such warrants and minimum number of warrants that are
exercisable;
|
|
|
·
|
the
currency or currency units in which the offering price, if any, and the
exercise price are payable;
|
|
|
·
|
the
number of securities, if any, with which such warrants are being offered
and the number of such warrants being offered with each
security;
|
|
|
·
|
the
date on and after which such warrants and the related securities, if any,
will be transferrable separately;
|
|
|
·
|
the
amount of securities purchasable upon exercise of each warrant and the
price at which the securities may be purchased upon such exercise, and
events or conditions under which the amount of securities may be subject
to adjustment;
|
|
|
·
|
the
date on which the right to exercise such warrants shall commence and the
date on which such right shall
expire;
|
|
|
·
|
the
circumstances, if any, which will cause the warrants to be deemed to be
automatically exercised;
|
|
|
·
|
any
material risk factors, if any, relating to such
warrants;
|
|
|
·
|
the
identity of any warrant agent; and
|
|
|
·
|
any
other terms of such warrants (which shall not be inconsistent with the
provisions of the warrant
agreement).
|
The terms
of the warrants that we offer may or may not have the same material terms as our
currently outstanding warrants.
Prior to
the exercise of any warrants, holders of such warrants will not have any rights
of holders of the securities purchasable upon such exercise, including the right
to receive payments of dividends, if any, on the securities purchasable upon
such exercise, statutory appraisal rights or the right to vote such underlying
securities. Prospective purchasers of warrants should be aware that material
U.S. federal income tax, accounting and other considerations may be applicable
to instruments such as warrants.
We may
issue units comprised of one or more of the other securities described in this
prospectus in any combination. Each unit will be issued so that the holder of
the unit is also the holder of each security included in the unit. Thus, the
holder of a unit will have the rights and obligations of a holder of each
included security. A unit agreement under which a unit is issued may provide
that the securities included in the unit may not be held or transferred
separately, at any time or at any time before a specified date.
The
applicable prospectus supplement may describe:
|
|
·
|
the
designation and terms of the units and of the securities comprising the
units, including whether and under what circumstances those securities may
be held or transferred separately;
|
|
|
·
|
any
provisions for the issuance, payment, settlement, transfer or exchange of
the units or of the securities comprising the units;
and
|
|
|
·
|
any
additional terms of the governing unit
agreement.
|
The
applicable prospectus supplement will describe the terms of any units. The
preceding description and any description of units in the applicable prospectus
supplement does not purport to be complete and is subject to and is qualified in
its entirety by reference to the unit agreement and, if applicable, collateral
arrangements and depositary arrangements relating to such units.
ANTI-TAKEOVER
CHARTER PROVISIONS AND LAWS
Some
features of our certificate of incorporation and by-laws and the Delaware
General Corporation Law (DGCL), which are further described below, may have the
effect of deterring third parties from making takeover bids for control of our
company or may be used to hinder or delay a takeover bid. This would decrease
the chance that our stockholders would realize a premium over market price for
their shares of common stock as a result of a takeover bid. See Risk
Factors.
Limitations
on Stockholder Actions
Our
certificate of incorporation provides that stockholder action may only be taken
at a meeting of the stockholders. Thus, an owner of a majority of the voting
power could not take action to replace the board of directors, or any class of
directors, without a meeting of the stockholders, nor could he amend the by-laws
without presenting the amendment to a meeting of the stockholders. Furthermore,
under the provisions of the certificate of incorporation and by-laws, only the
board of directors has the power to call a special meeting of stockholders.
Therefore, a stockholder, even one who owns a majority of the voting power, may
neither replace sitting board of directors members nor amend the by-laws before
the next annual meeting of stockholders.
Advance
Notice Provisions
Our
by-laws establish advance notice procedures for the nomination of candidates for
election as directors by stockholders, as well as for other stockholder
proposals to be considered at annual meetings. Generally, we must receive a
notice of intent to nominate a director or raise any other matter at a
stockholder meeting not less than 120 days before the first anniversary of the
mailing of our proxy statement for the previous year’s annual meeting. The
notice must contain required information concerning the person to be nominated
or the matters to be brought before the meeting and concerning the stockholder
submitting the proposal.
Delaware
Law
We are
incorporated in Delaware, and as such are subject to Section 203 of the DGCL,
which provides that a corporation may not engage in any business combination
with an interested stockholder during the three years after he becomes an
interested stockholder unless:
•
the corporation’s board of
directors approved in advance either the business combination or the transaction
which resulted in the stockholder becoming an interested
stockholder;
• the
interested stockholder owned at least 85 percent of the corporation’s voting
stock at the time the transaction commenced; or
• the
business combination is approved by the corporation’s board of directors and the
affirmative vote of at least two-thirds of the voting stock which is not owned
by the interested stockholder.
An
interested stockholder is anyone who owns 15 percent or more of a corporation’s
voting stock, or who is an affiliate or associate of the corporation and was the
owner of 15 percent or more of the corporation’s voting stock at any time within
the previous three years; and the affiliates and associates of any those
persons. Section 203 of the DGCL makes it more difficult for an interested
stockholder to implement various business combinations with our Company for a
three-year period, although our stockholders may vote to exclude it from the
law’s restrictions.
Classified
Board
Our
certificate of incorporation and by-laws divide our board of directors into
three classes with staggered three year terms. There are currently eight
directors, two in one class and three in each of two additional classes. At each
annual meeting of stockholders, the terms of one class of directors will expire
and the newly nominated directors of that class will be elected for a term of
three years. The board of directors will be able to determine the total number
of directors constituting the full board of directors and the number of
directors in each class, but the total number of directors may not exceed 9 nor
may the number of directors in any class exceed six. Subject to these rules, the
classes of directors need not have equal numbers of members. No reduction in the
total number of directors or in the number of directors in a given class will
have the effect of removing a director from office or reducing the term of any
then sitting director. Stockholders may only remove directors for cause. If the
board of directors increases the number of directors in a class, it will be able
to fill the vacancies created for the full remaining term of a director in that
class even though the term may extend beyond the next annual meeting. The
directors will also be able to fill any other vacancies for the full remaining
term of the director whose death, resignation or removal caused the
vacancy.
A person
who has a majority of the voting power at a given meeting will not in any one
year be able to replace a majority of the directors since only one class of the
directors will stand for election in any one year. As a result, at least two
annual meeting elections will be required to change the majority of the
directors by the requisite vote of stockholders. The purpose of classifying the
board of directors is to provide for a continuing body, even in the face of a
person who accumulates a sufficient amount of voting power, whether by ownership
or proxy or a combination, to have a majority of the voting power at a given
meeting and who may seek to take control of our Company without paying a fair
premium for control to all of the owners of our common stock. This will allow
the board of directors time to negotiate with such a person and to protect the
interests of the other stockholders who may constitute a majority of the shares
not actually owned by that person. However, it may also have the effect of
deterring third parties from making takeover bids for control of our Company or
may be used to hinder or delay a takeover bid.
Transfer
Agent and Registrar
The transfer agent and registrar for
our common stock is Continental Stock Transfer & Trust Company, located in
New York, New York.
SELLING
STOCKHOLDERS
Under this prospectus and any
applicable supplements, the selling stockholder may sell shares of our common
stock. These shares may be acquired by the selling stockholder upon the exercise
of the Montaur Warrants, and/or upon conversion of outstanding shares of our
Series B Preferred Stock, which were issued in June 2010 in exchange for the
Montaur Notes and the Series A Preferred Stock. The selling stockholder may also
sell shares of common stock that were issued to them as interest on the Montaur
Notes prior to the June 2010 exchange, or as preferred dividends on the Series A
Preferred Stock prior to the June 2010 exchange. As used in this prospectus,
“selling stockholder” will refer to the selling stockholder along with any
pledgees, assignees, donees, transferees or successors in interest.
The following table presents
information regarding the selling stockholder and the shares that may be sold by
it pursuant to this prospectus.
|
Selling
Stockholder
|
|
Shares
Owned
Before
Offering (1)
|
|
|
Percentage of
Outstanding
Shares Owned
Before Offering (1)
|
|
|
Shares to be
Sold in the
Offering
|
|
|
Percentage of
Outstanding
Shares Owned
After Offering (1)
|
|
|
Platinum-Montaur
Life Sciences, LLC (2)(3)
|
|
|
7,671,621 |
|
|
|
9.3 |
% |
|
|
15,000,000 |
|
|
|
9.3 |
% |
(1) The
ownership percentages listed in these columns include only shares beneficially
owned by the listed selling stockholder. Beneficial ownership is determined in
accordance with the rules of the Securities and Exchange Commission. In
computing the percentage of shares beneficially owned by a selling stockholder,
shares of common stock subject to warrants or preferred stock convertible into
common stock held by that selling stockholder that were exercisable on or within
60 days after August 2, 2010, were deemed outstanding for the purpose of
computing the percentage ownership of that selling stockholder. The ownership
percentages are calculated assuming that 82,280,755 shares of common stock were
outstanding on August 2, 2010. Of the 7,671,621 shares set forth in the table
above, 7,463,985 are held by Platinum Partners Value Arbitrage Fund, LP, a
Cayman Island exempt partnership (“PPVAF”). PPVAF’s address is 152 West 57th Street,
54th
Floor, New York, NY. None of the shares held by PPVAF are being offered
hereby.
(2) Prior
to giving effect to the offering, Platinum-Montaur Life Sciences, LLC
(“Montaur”), 152 W. 57th Street,
54th
Floor, New York, NY 10019, holds: (a) 10,000 shares of our Series B Preferred
Stock convertible into 32,700,000 shares of our common stock; and (b) warrants
to purchase 16,733,333 shares of our common stock. Each of our shares
of preferred stock and warrants held by Montaur provide that Montaur may not
convert any of the preferred stock, or exercise any of the warrants, to the
extent that such conversion or exercise would result in the holder and its
affiliates together beneficially owning more than 4.99% or 9.99% of the
outstanding shares of our common stock, except on 61 days’ prior written notice
to us that Montaur waives such limitation. Following the offering, assuming the
sale of all shares of our common stock offered hereby, Montaur will still hold
7,671,621 shares of our common stock.
(3) Marc
Nordlicht has the voting and dispositive power over the shares to be sold in the
offering. Mr. Nordlicht disclaims beneficial ownership of such shares except to
the extent of his pecuniary interest in the selling stockholder.
For each sale of common stock by a
selling stockholder, we will file a prospectus supplement setting forth, with
respect to each selling stockholder:
|
|
·
|
the
name of the selling stockholder;
|
|
|
·
|
the
nature of any position, office or other material relationship which the
selling stockholder will have had during the prior three years with us or
any of our predecessors or
affiliates;
|
|
|
·
|
the
number of common shares owned by the selling stockholder prior to the
offering;
|
|
|
·
|
the
number of common shares to be offered for the selling stockholder’s
account; and
|
|
|
·
|
the
number of shares and (if one percent or more) the percentage of our common
shares to be owned by the selling stockholder after completion of the
offering.
|
PLAN
OF DISTRIBUTION
We and the selling stockholders may
sell the securities from time to time pursuant to underwritten public offerings,
negotiated transactions, block trades or a combination of these methods. We and
the selling stockholders may sell the securities separately or
together:
|
|
·
|
through
one or more underwriters or dealers in a public offering and sale by
them;
|
|
|
·
|
directly
to one or more purchasers.
|
The securities may be distributed from
time to time in one or more transactions:
|
|
·
|
at
a fixed price or prices, which may be
changed;
|
|
|
·
|
at
market prices prevailing at the time of
sale;
|
|
|
·
|
at
prices related to such prevailing market prices;
or
|
We or the selling stockholders may
solicit directly offers to purchase the securities being offered by this
prospectus, and may also designate agents to solicit offers to purchase the
securities from time to time. We will name in a prospectus supplement any agent
involved in the offer or sale of the securities.
If we utilize a dealer in the sale of
the securities being offered by this prospectus, we will sell the securities to
the dealer, as principal. The dealer may then resell the securities to the
public at varying prices to be determined by the dealer at the time of
resale.
If we or the selling stockholders
utilize an underwriter in the sale of the securities being offered by this
prospectus, we and/or the selling stockholders will execute an underwriting
agreement with the underwriter at the time of sale and we will provide the name
of any underwriter in the prospectus supplement that the underwriter will use to
make resales of the securities to the public. In connection with the sale of the
securities, we or the purchasers of securities for whom the underwriter may act
as agent may compensate the underwriter in the form of underwriting discounts or
commissions. The underwriter may sell the securities to or through dealers, and
the underwriter may compensate those dealers in the form of discounts,
concessions or commissions.
In
compliance with guidelines of the Financial Industry Regulatory Authority, or
FINRA, the maximum consideration or discount to be received by any FINRA member
or independent broker dealer may not exceed 8.0% of the aggregate amount of the
securities offered pursuant to this prospectus and any applicable prospectus
supplement.
We will provide in the applicable
prospectus supplement any compensation we will pay to underwriters, dealers or
agents in connection with the offering of the securities, and any discounts,
concessions or commissions allowed by underwriters to participating dealers.
Underwriters, dealers and agents participating in the distribution of the
securities may be deemed to be underwriters within the meaning of the Securities
Act of 1933, as amended, and any discounts and commissions received by them and
any profit realized by them on resale of the securities may be deemed to be
underwriting discounts and commissions. We may enter into agreements to
indemnify underwriters, dealers and agents against civil liabilities, including
liabilities under the Securities Act or to contribute to payments they may be
required to make in respect thereof.
The securities may or may not be listed
on a national securities exchange. To facilitate the offering of securities,
certain persons participating in the offering may engage in transactions that
stabilize, maintain or otherwise affect the price of the securities. This may
include over-allotments or short sales of the securities, which involves the
sale by persons participating in the offering of more securities than we sold to
them. In these circumstances, these persons would cover such over-allotments or
short positions by making purchases in the open market or by exercising their
over-allotment option. In addition, these persons may stabilize or maintain the
price of the securities by bidding for or purchasing securities in the open
market or by imposing penalty bids, whereby selling concessions allowed to
dealers participating in the offering may be reclaimed if securities sold by
them are repurchased in connection with stabilization transactions. The effect
of these transactions may be to stabilize or maintain the market price of the
securities at a level above that which might otherwise prevail in the open
market. These transactions may be discontinued at any time.
We may enter into derivative
transactions with third parties, or sell securities not covered by this
prospectus to third parties in privately negotiated transactions. If the
applicable prospectus supplement indicates, in connection with any derivative
transaction, the third parties may sell securities covered by this prospectus
and the applicable prospectus supplement, including in short sale transactions.
If so, the third party may use securities pledged by us or borrowed from us or
others to settle those sales or to close out any related open borrowings of
stock, and may use securities received from us in settlement of those
derivatives to close out any related open borrowings of stock. The third party
in such sale transactions will be an underwriter and, if not identified in this
prospectus, will be identified in the applicable prospectus supplement or a
post-effective amendment to the registration statement of which this prospectus
is a part. In addition, we may otherwise loan or pledge securities to a
financial institution or other third party that in turn may sell the securities
short using this prospectus. Such financial institution or other third party may
transfer its economic short position to investors in our securities or in
connection with a concurrent offering of other securities.
The selling stockholders may also sell
our common stock in one or more privately negotiated transactions exempt from
the registration requirements of the Securities Act pursuant to Rule 144 under
the Securities Act, Section 4(1) of the Securities Act or other applicable
exemptions, regardless of whether the securities are covered by the registration
statement of which this prospectus forms a part. Such sales, if any, will not
form part of the plan of distribution described in this prospectus. The selling
stockholders will act independently of us in making decisions with respect to
the timing, manner and size of each such sale.
The underwriters, dealers and agents
may engage in transactions with us, or perform services for us, in the ordinary
course of business.
LEGAL
MATTERS
The validity of the shares offered
hereby has been passed upon for us by Porter, Wright, Morris & Arthur LLP,
41 South High Street, Columbus, Ohio 43215.
EXPERTS
The financial statements as of December
31, 2009 and 2008 and for each of the years then ended incorporated by reference
in this Prospectus have been so incorporated in reliance on the report of BDO
Seidman, LLP, an independent registered public accounting firm, incorporated
herein by reference, given on the authority of said firm as experts in auditing
and accounting.
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other
Expenses of Issuance and Distribution.
The following table sets forth the
expenses expected to be incurred by our company in connection with the issuance
and distribution of the securities being registered.
|
SEC
registration fee
|
|
$ |
3,565.00 |
|
|
Legal
fees and expenses
|
|
|
** |
|
|
Accounting
fees
|
|
$ |
8,500.00 |
|
|
Printing
expenses
|
|
|
** |
|
|
Miscellaneous
|
|
$ |
2,074.00 |
|
|
|
|
|
|
|
|
Total
|
|
$ |
14,139.00 |
|
** Estimated
expenses are presently not known and cannot be estimated.
Item
15. Indemnification
of Directors and Officers.
Section
145 of the General Corporation Law of the State of Delaware (Section 145)
provides that directors and officers of Delaware corporations may, under certain
circumstances, be indemnified against expenses (including attorneys’ fees) and
other liabilities actually and reasonably incurred by them as a result of any
suit brought against them in their capacity as a director or officer, if they
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, if they had no reasonable cause to believe their
conduct was unlawful. Section 145 also provides that directors and officers may
also be indemnified against expenses (including attorneys’ fees) incurred by
them in connection with a derivative suit if they acted in good faith and in a
manner they reasonably believed to be in or not opposed to the best interests of
the corporation, except that no indemnification may be made without court
approval if such person was adjudged liable to the corporation.
Article V
of the Company’s By-laws contains provisions which require that the Company
indemnify its officers, directors, employees and agents, in substantially the
same language as Section 145.
Article
Nine, section (b), of the Company’s Certificate of Incorporation further
provides that no director will be personally liable to the Company or its
stockholders for monetary damages or for any breach of fiduciary duty except for
breach of the director’s duty of loyalty to the Company or its stockholders, for
acts or omissions not in good faith or involving intentional misconduct or a
knowing violation of law, pursuant to Section 174 of the Delaware General
Corporation Law (which imposes liability in connection with the payment of
certain unlawful dividends, stock purchases or redemptions), or any amendment or
successor provision thereto, or for any transaction from which a director
derived an improper personal benefit.
Item
16. Exhibits.
|
Exhibit
Number
|
|
Footnote
|
|
Exhibit
Description
|
|
|
|
|
|
|
|
4.1
|
|
*
|
|
Amended
and Restated Certificate of Incorporation of Neoprobe Corporation as
corrected February 18, 1994 and amended June 27, 1994, June 3, 1996, March
17, 1999, May 9, 2000, June 13, 2003, July 27, 2004, June 22, 2005 and
November 20, 2006.
|
|
|
|
|
|
|
|
4.2
|
|
(a)
|
|
Amended
and Restated By-Laws dated July 21, 1993, as amended July 18, 1995, May
30, 1996 and July 26, 2007.
|
|
|
|
|
|
|
|
5.1
|
|
*
|
|
Opinion
of Porter, Wright, Morris & Arthur LLP.
|
|
|
|
|
|
|
|
23.1
|
|
*
|
|
Consent
of Porter, Wright, Morris & Arthur LLP (included in Exhibit
5).
|
|
|
|
|
|
|
|
23.2
|
|
*
|
|
Consent
of Independent Registered Public Accounting Firm.
|
|
|
|
|
|
|
|
24.1
|
|
*
|
|
Power
of
Attorney.
|
*
Filed herewith.
|
(a)
|
Incorporated
by reference to Exhibit 3.2 previously filed on August 3, 2007, with
Neoprobe’s Current Report on
Form 8-K.
|
Item
17. Undertakings.
(a) The
undersigned hereby undertakes:
(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
volume of securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the low or
high and of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent 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 (1)(i), (1)(ii) and (1)(iii) above 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
Commission by the registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that
are incorporated by reference in the registration statement, or is
contained in a form of prospectus filed pursuant to Rule 424(b) that is
part of the 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
the purpose of determining liability under the Securities Act of 1933 to any
purchaser:
|
|
(i)
|
If
the registrant is relying on Rule
430B:
|
(A)
Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to
be part of the registration statement as of the date the filed prospectus was
deemed part of and included in the registration statement;
and
(B)
Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as
part of a registration statement in reliance on Rule 430B relating to an
offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose
of providing the information required by section 10(a) of the Securities Act of
1933 shall be deemed to be part of and included in the registration statement as
of the earlier of the date such form of prospectus is first used after
effectiveness or the date of the first contract of sale of securities in the
offering described in the prospectus. As provided in Rule 430B, for
liability purposes of the issuer and any person that is at that date an
underwriter, such date shall be deemed to be a new effective date of the
registration statement relating to the securities in the registration statement
to which that prospectus relates, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof. Provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such effective date,
supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such
document immediately prior to such effective date; or
(ii) If
the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule
424(b) as part of a registration statement relating to an offering, other than
registration statements relying on Rule 430B or other than prospectuses filed in
reliance on Rule 430A, shall be deemed to be part of and included in the
registration statement as of the date it is first used after
effectiveness. Provided, however, that no statement made in a
registration statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the registration statement
will, as to a purchaser with a time of contract of sale prior to such first use,
supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such
document immediately prior to such date of first use.
(5)
That, for
the purpose of determining liability of the registrant under the Securities Act
of 1933 to any purchaser in the initial distribution of the securities, the
undersigned registrant undertakes that in a primary offering of securities of
the undersigned registrant pursuant to this registration statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned registrant will be a seller to the
purchaser and will be considered to offer or sell such securities to such
purchaser:
(iv) Any
other communication that is an offer in the offering made by the undersigned
registrant to the purchaser.
|
|
(b)
|
The
undersigned registrant hereby undertakes 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
Exchange Act (and, where applicable, each filing of an employee benefit
plan’s annual report pursuant to Section 15(d) of the Exchange Act) that
is incorporated by reference in the registration statement 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.
|
|
|
(c)
|
Insofar
as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to the 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 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 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 and will be governed by the final
adjudication of such issue.
|
|
|
(d)
|
The
undersigned hereby undertakes that:
|
(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 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.
Pursuant to the requirements of the
Securities Act of 1933, the Registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Dublin, State of Ohio, on
August 3, 2010.
|
|
NEOPROBE
CORPORATION
|
|
|
|
|
|
|
|
/s/ Brent L. Larson
|
|
|
|
Brent
L. Larson, Senior Vice President, Chief Financial
|
|
|
|
Officer,
Treasurer and Secretary
|
|
Pursuant to the requirements of the
Securities Act of 1933, as amended, this Registration Statement has been signed
by the following persons in the capacities and on the dates
indicated:
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
* David C. Bupp
|
|
President,
Chief Executive Officer
|
|
August
3, 2010
|
|
David
C. Bupp
|
|
and
Director
|
|
|
|
|
|
(principal
executive officer)
|
|
|
|
|
|
|
|
|
|
/s/ Brent L. Larson
|
|
Senior
Vice President, Chief
|
|
August
3, 2010
|
|
Brent
L. Larson
|
|
Financial
Officer, Treasurer and
|
|
|
|
|
|
Secretary
(principal financial officer
|
|
|
|
|
|
and
principal accounting officer)
|
|
|
|
|
|
|
|
|
|
* Carl J. Aschinger, Jr.
|
|
Chairman
of the Board of
|
|
August
3, 2010
|
|
Carl
J. Aschinger, Jr.
|
|
Directors
|
|
|
|
|
|
|
|
|
|
* Gordon A. Troup
|
|
Vice
Chairman of the Board of
|
|
August
3, 2010
|
|
Gordon
A. Troup
|
|
Directors
|
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
|
|
Kirby
I. Bland, M.D.
|
|
|
|
|
|
|
|
|
|
|
|
* Brendan A. Ford
|
|
Director
|
|
August
3, 2010
|
|
Brendan
A. Ford
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
|
|
Owen
E. Johnson, M.D.
|
|
|
|
|
|
|
|
|
|
|
|
* Fred B. Miller
|
|
Director
|
|
August
3, 2010
|
|
Fred
B. Miller
|
|
|
|
|
|
|
|
|
|
|
|
* Eric K. Rowinsky, M.D.
|
|
Director
|
|
August
3, 2010
|
|
Eric
K. Rowinsky, M.D.
|
|
|
|
|
|
* By:
|
/s/ Brent L. Larson
|
|
|
Brent
L. Larson, attorney-in-fact for each of
the persons
indicated
|
Exhibit
Index
|
|
|
Footnote
|
|
Exhibit Description
|
|
4.1
|
|
*
|
|
Amended
and Restated Certificate of Incorporation of Neoprobe Corporation as
corrected February 18, 1994 and amended June 27, 1994, June 3, 1996, March
17, 1999, May 9, 2000, June 13, 2003, July 27, 2004, June 22, 2005 and
November 20, 2006.
|
|
|
|
|
|
|
|
4.2
|
|
(a)
|
|
Amended
and Restated By-Laws dated July 21, 1993, as amended July 18, 1995, May
30, 1996 and July 26, 2007.
|
|
|
|
|
|
|
|
5.1
|
|
*
|
|
Opinion
of Porter, Wright, Morris & Arthur LLP.
|
|
|
|
|
|
|
|
23.1
|
|
*
|
|
Consent
of Porter, Wright, Morris & Arthur LLP (included in Exhibit
5).
|
|
|
|
|
|
|
|
23.2
|
|
*
|
|
Consent
of Independent Registered Public Accounting Firm.
|
|
|
|
|
|
|
|
24.1
|
|
*
|
|
Power
of Attorney.
|
* Filed
herewith.
|
(a)
|
Incorporated
by reference to Exhibit 3.2 previously filed on August 3, 2007, with
Neoprobe’s Current Report on
Form 8-K.
|