Nevada
|
2834
|
87-0449967
|
(State
or other jurisdiction of
|
(Primary
Standard Industrial
|
(I.R.S.
Employer
|
incorporation
or organization)
|
Classification
Code Number)
|
Identification
No.)
|
Ryan
Murr, Esq.
|
Kyle
Guse, Esq.
|
Goodwin
Procter LLP
|
McDermott
Will & Emery LLP
|
Three
Embarcadero Center, 24th
Floor
|
275
Middlefield Road
|
San Francisco,
California 94111-4003
|
Menlo
Park, California 94025
|
(415) 733-6000
(phone)
|
(650)
815-7400 (phone)
|
(415)
677-9041 (facsimile)
|
(650)
815-7401 (facsimile)
|
Large
accelerated filer £
|
Accelerated
filer £
|
Non-accelerated
filer £
|
Smaller reporting company R
|
(Do not check if a smaller
reporting company)
|
CALCULATION
OF REGISTRATION FEE
|
||||||||
Title of Each Class of Securities to be Registered
|
Proposed maximum aggregate
offering price (1)(2)
|
Amount of registration fee
|
||||||
Units,
each unit consisting of one share of common stock, $0.001 par value per
share, and warrants to purchase common stock (3)
|
$ | 6,500,000 | $ | 463.45 |
Per Unit
|
Total
|
|||||||
Offering
price per unit
|
$ | $ | ||||||
Placement
agent’s fees
|
$ | $ | ||||||
Offering
proceeds, before expenses, to NexMed, Inc.
|
$ | $ |
Page
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4
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8
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15
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16
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17
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17
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18
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19
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25
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34
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37
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42
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43
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44
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47
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47
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47
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|
48
|
|
F-1
|
-
Transdermal
|
-
Rectal
|
|
-
Oral
|
-
Buccal (absorbed in the mouth)
|
|
-
Subcutaneous
|
Therapeutic Area
|
Drug Candidate
|
Indication
|
Delivery
Method
|
Development Stage
|
||||
Sexual
Dysfunction
|
Vitaros
|
Erectile
Dysfunction
|
Topical
|
Approval
decision pending (Canada)
|
||||
Dermatology
|
MycoVaTM
|
Onychomycosis
|
Topical
|
Phase
III
|
||||
Sexual
Dysfunction
|
Femprox
|
Female
Sexual Arousal Disorder
|
Topical
|
Phase
II
|
||||
Oncology
|
PrevOncoTM
(lansoprazole)
|
HCC
(Liver Cancer)
|
Oral
|
Investigational
new drug application (“IND”) accepted (Phase 2/3)
|
||||
Cardiovascular
|
RayVaTM
|
Raynaud’s
Syndrome
|
Topical
|
IND
to be filed (Phase 2/3)
|
||||
Oncology
|
Paclitaxel
(Taxol®)
|
Squamous
Carcinoma Mouth Cancers
|
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Filgrastim
(Neupogen®)
|
Post-chemotherapy
Recovery of Neutrophil Counts
|
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Rituxan® | Non-Hodgkin’s Lymphoma |
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Fluorouracil
|
Actinic
Keratosis
(skin
lesions)
|
Topical
|
Pre-clinical
animal studies
|
||||
Dermatology
|
PsoriaVaTM
|
Psoriasis
|
Topical
|
Pre-clinical
animal studies
|
||||
Anti-Inflammatory
|
Lidocaine
|
Pain
|
Topical
|
Pre-clinical
animal studies
|
||||
Dermatology
|
DDAIP
|
Anti-Aging
(Cosmetic)
|
Topical
|
Pre-clinical
animal
studies
|
Securities
offered
|
Up
to
units. Each unit will consist of one share of common stock and one
warrant. Each warrant entitles its holder to purchase
shares of our common
stock. The units will immediately separate upon
issuance.
|
|
Offering
price
|
$ per
unit, which is the midpoint of the price range on the cover page of this
prospectus.
|
|
Description
of warrants
|
The
warrants will be exercisable at any time until the fifth anniversary of
the closing date at an exercise price of
$
per share.
|
|
Common
stock outstanding before this offering
|
shares.
|
|
Common
stock to be outstanding after this offering
|
shares, which does not include
shares of common stock issuable upon exercise of the warrants included in
the offered units.
|
|
Use
of proceeds
|
We
plan to use the net proceeds of this offering to further develop our
product candidates and for general working capital purposes. For a
more complete description of our intended use of proceeds from this
offering, see “Use of Proceeds.”
|
|
Risk
factors
|
You
should read the “Risk Factors” section of, and all of the other
information set forth in, this prospectus for a discussion of factors to
consider carefully before deciding to invest in our
securities.
|
|
NASDAQ
Capital Market symbol
|
|
“NEXM”
|
|
·
|
156,771 shares
of common stock issuable upon exercise of stock options outstanding and
having a weighted-average exercise price of $16.07 per
share;
|
|
·
|
262,103
shares of common stock issuable upon the vesting of restricted stock
awards;
|
|
·
|
627,986 shares
of common stock reserved for future issuance under our equity compensation
plans; and
|
|
·
|
717,095 shares
of common stock issuable upon the exercise of warrants and convertible
notes outstanding (see “Risk Factors – We may issue additional shares of
our capital stock that could dilute the value of your shares of common
stock”).
|
|
•
|
our
expectations related to the use of proceeds from this
offering;
|
|
•
|
the
progress of, timing of and amount of expenses associated with our
research, development and commercialization
activities;
|
|
•
|
the
timing, conduct and success of our clinical studies for our product
candidates in development;
|
|
•
|
our
ability to obtain U.S. and foreign regulatory approval for our
product candidates in development and the ability of our product
candidates in development to meet existing or future regulatory
standards;
|
|
•
|
our
expectations regarding federal, state and foreign regulatory
requirements;
|
|
•
|
the
therapeutic benefits and effectiveness of our product candidates in
development;
|
|
•
|
the
accuracy of our estimates of the size and characteristics of the markets
that may be addressed by our product candidates in
development;
|
|
•
|
our
ability to manufacture sufficient amounts of our product candidates in
development for clinical studies and products for commercialization
activities;
|
|
•
|
our
intention to seek to establish strategic collaborations or partnerships
for the development or sale of our product
candidates;
|
|
•
|
our
expectations as to future financial performance, revenues, expense levels
and liquidity sources;
|
|
•
|
the
timing of potential commercialization of our product
candidates;
|
|
•
|
our
ability to compete with other companies that are or may be developing or
selling products that are competitive with our product candidates in
development;
|
|
•
|
anticipated
trends and challenges in our potential
markets;
|
|
•
|
our
ability to attract and retain key
personnel; and
|
|
•
|
other
factors discussed elsewhere in this
prospectus.
|
|
·
|
in
the event 25% of the securities offered hereby are sold, we estimate that
we will receive net proceeds of approximately
$ ,
and we will allocate such proceeds to general working capital of the
Company;
|
|
·
|
in
the event 50% of the securities offered hereby are sold, we estimate that
we will receive net proceeds of approximately
$ ,
and we will use the additional
$
in net proceeds for the following:
|
|
○
|
Seeking
approval of DDAIP as a GRAS ingredient (generally recognized as safe
(“GRAS”) is an FDA designation that a chemical or substance added to food
is considered safe by experts, and so is exempted from the usual Federal
Food, Drug, and Cosmetic Act food additive tolerance requirements);
and
|
|
○
|
Initiating
Taxol and Neupogen human proof-of-concept clinical
trials;
|
|
·
|
in
the event 75% of the securities offered hereby are sold, we estimate that
we will receive net proceeds of approximately
$ ,
and we will use the additional
$
in net proceeds for the following:
|
|
○
|
Initiating
Rituxan human proof-of-concept clinical trials;
and
|
|
○
|
Initiating
clinical logistics in preparation of PrevOnco’s phase 3 clinical
trials;
|
|
·
|
in
the event all of the securities offered hereby are sold, we estimate that
we will receive net proceeds of approximately
$ ,
and we will use the net proceeds for the
following:
|
|
○
|
the
further development of our pre-clinical programs, including PsoriaVa™ and
our formulations for the delivery if Insulin, Fluorouracil, and
Lidocaine;
|
|
○
|
Pre-clinical
validation for DDAIP for uses other than pharmaceutical such as
preservative and cosmeceutical uses;
and
|
|
○
|
RayVa
human clinical trials.
|
High
|
Low
|
|||||||
First
Quarter 2008
|
$ | 26.25 | $ | 16.80 | ||||
Second
Quarter 2008
|
$ | 22.05 | $ | 15.15 | ||||
Third
Quarter 2008
|
$ | 23.70 | $ | 1.59 | ||||
Fourth
Quarter 2008
|
$ | 5.25 | $ | 0.68 | ||||
First
Quarter 2009
|
$ | 4.20 | $ | 1.20 | ||||
Second
Quarter 2009
|
$ | 8.10 | $ | 1.80 | ||||
Third
Quarter 2009
|
$ | 6.82 | $ | 2.25 | ||||
Fourth
Quarter 2009
|
$ | 7.63 | $ | 1.80 | ||||
First
Quarter 2010
|
$ | 12.58 | $ | 3.94 | ||||
Second
Quarter 2010
|
$ | 9.30 | $ | 2.10 |
Assumed
offering price per share
|
$ | |||||||
Pro
forma net tangible book value per share as of June 30,
2010
|
$ | |||||||
Increase
per unit attributable to investors participating in this
offering
|
$ | |||||||
Pro
forma net tangible book value per share after this
offering
|
$ | |||||||
Dilution
per unit to investors participating in this offering
|
$ |
|
·
|
156,771
shares of common stock issuable upon exercise of stock options outstanding
and having a weighted-average exercise price of $16.07 per
share;
|
|
·
|
262,103
shares of common stock issuable upon the vesting of restricted stock
awards;
|
|
·
|
627,986
shares of common stock reserved for future issuance under our equity
compensation plans; and
|
|
·
|
717,095
shares of common stock issuable upon the exercise of warrants and
convertible notes outstanding (see “Risk Factors – We may issue additional
shares of our capital stock that could dilute the value of your shares of
common stock”).
|
-
Transdermal
-
Oral
-
Subcutaneous
|
-
Rectal
-
Buccal (absorbed in the
mouth)
|
Therapeutic Area
|
Drug Candidate
|
Indication
|
Delivery
Method
|
Development Stage
|
||||
Sexual
Dysfunction
|
Vitaros
|
Erectile
Dysfunction
|
Topical
|
Approval
decision pending (Canada)
|
||||
Dermatology
|
MycoVaTM
|
Onychomycosis
|
Topical
|
Phase
III
|
||||
Sexual
Dysfunction
|
Femprox
|
Female
Sexual Arousal Disorder
|
Topical
|
Phase
II
|
||||
Oncology
|
PrevOncoTM
(lansoprazole)
|
HCC
(Liver Cancer)
|
Oral
|
Investigational
new drug application (“IND”) accepted (Phase 2/3)
|
||||
Cardiovascular
|
RayVaTM
|
Raynaud’s
Syndrome
|
Topical
|
IND
to be filed (Phase 2/3)
|
||||
Oncology
|
Paclitaxel
(Taxol®)
|
Squamous
Carcinoma Mouth Cancers
|
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Filgrastim
(Neupogen®)
|
Post-chemotherapy
Recovery of Neutrophil Counts
|
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Rituxan® | Non-Hodgkin’s Lymphoma |
Topical
|
Pre-clinical
animal studies
|
||||
Oncology
|
Fluorouracil
|
Actinic
Keratosis
(skin
lesions)
|
Topical
|
Pre-clinical
animal studies
|
||||
Dermatology
|
PsoriaVaTM
|
Psoriasis
|
Topical
|
Pre-clinical
animal studies
|
||||
Anti-Inflammatory
|
Lidocaine
|
Pain
|
Topical
|
Pre-clinical
animal studies
|
||||
Dermatology
|
DDAIP
|
Anti-Aging
(Cosmetic)
|
Topical
|
Pre-clinical
animal
studies
|
-
Transdermal
|
-
Rectal
|
-
Oral
|
-
Buccal (absorbed in the mouth)
|
-
Subcutaneous
|
Patent Name
|
Expiration Date
|
|
Compositions
and Methods for Amelioration of Human Female Sexual
Dysfunction
|
2017
|
|
Topical
Compositions for PGE1 Delivery
|
2017
|
|
Topical
Compositions for Non-Steroidal Anti-Inflammatory Drug
Delivery
|
2017
|
|
Medicament
Dispenser
|
2019
|
|
Crystalline
Salts of dodecyl 2-(N, N-Dimethylamino)-propionate*
|
2019
|
|
Topical
Compositions Containing Prostaglandin E1
|
2019
|
|
CIP:
Topical Compositions Containing Prostaglandin E1
|
2019
|
|
Topical
Stabilized Prostaglandin E Compound Dosage Forms
|
2023
|
|
Antifungal
Nail Coat Method of Use
|
2026
|
|
Stabilized
Prostaglandin E Composition
|
2026
|
Name
|
Age
|
Position
|
||
Bassam
B. Damaj, Ph.D.
|
41
|
President
and Chief Executive Officer and Director
|
||
Vivian
H. Liu
|
48
|
Executive
Vice President, Director and Chairman of the Board
|
||
Henry
J. Esber, Ph.D.
|
72
|
Executive
Vice President (Bio-Quant, Inc.) and Director
|
||
Mark
Westgate
|
40
|
Vice
President, Chief Financial Officer and Treasurer
|
||
Edward
M. Cox
|
29
|
Vice
President, Investor Relations and Corporate Development
|
||
Linda
Smibert
|
56
|
Vice
President of Business Development (NexMed (U.S.A.),
Inc.)
|
||
Mark
S. Wilson
|
50
|
Vice
President of Technology Development (NexMed (U.S.A.),
Inc.)
|
||
Terry
Ladd
|
60
|
Vice
President of Business Development (Bio-Quant, Inc.)
|
||
Richard
Martin, Ph.D.
|
44
|
Vice
President of Chemistry (NexMed (U.S.A.), Inc.)
|
||
Mohamed
Hachicha, Ph.D.
|
46
|
Vice
President, Research and Development (NexMed (U.S.A.),
Inc.)
|
||
Roberto
Crea, Ph.D. (1)(3)
|
62
|
Director
|
||
Deirdre
Y. Gillespie, M.D. (1)(2)
|
54
|
Director
|
||
Leonard
A. Oppenheim (2)(3)
|
63
|
Director
|
||
Rusty
Ray (1)(2)(3)
|
39
|
Director
|
(1)
|
Member
of Corporate Governance/Nominating
Committee.
|
(2)
|
Member
of Audit Committee.
|
(3)
|
Member
of Executive Compensation
Committee.
|
Name
and Position
|
Year
|
Salary
|
Bonus
|
Stock
Awards
(4)
|
Option
Awards
|
All
Other Compensation
(5)
|
Total
|
|||||||||||||||||||
Vivian
H. Liu (1)
|
2009
|
$ | 285,114 | — | — | — | $ | 5,285 | $ | 290,399 | ||||||||||||||||
Executive
Vice President and Chairman of the Board
|
2008
|
$ | 300,000 | — | $ | 147,000 | — | $ | 4,835 | $ | 451,835 | |||||||||||||||
Bassam
B. Damaj (2)
|
2009
|
$ | 12,500 | — | — | — | — | $ | 12,500 | |||||||||||||||||
President
and Chief Executive Officer
|
2008
|
— | — | — | — | — | — | |||||||||||||||||||
Mark
Westgate
|
2009
|
$ | 223,248 | — | — | — | $ | 3,564 | $ | 226,812 | ||||||||||||||||
Vice
President and Chief Financial Officer
|
2008
|
$ | 235,000 | — | $ | 222,000 | — | $ | 3,542 | $ | 460,542 | |||||||||||||||
Hemanshu
Pandya (3)
|
2009
|
$ | 222,229 | — | — | — | $ | 2,536 | $ | 225,793 | ||||||||||||||||
Chief
Operating Officer
|
2008
|
$ | 225,000 | — | $ | 222,000 | — | $ | 2,631 | $ | 449,631 |
(1)
|
Ms.
Liu was appointed Executive Vice President and Chairman of the Board in
December 2009. Prior to that, she served as our President and
Chief Executive Officer.
|
(2)
|
Dr.
Damaj was appointed our President and Chief Executive Officer in December
2009.
|
(3)
|
Mr.
Pandya’s employment as our Chief Operating Officer ended in June
2009.
|
(4)
|
Market
value of stock awards were determined by multiplying the number of shares
granted by the closing market price of our stock on the grant
date. Values are presented as the grant-date fair value
computed in accordance with FASB ASC Topic 718 and not the amount expensed
in a given year per FAS 123(R).
|
(5)
|
Other
Compensation includes amounts for the Company’s matching and profit
sharing contribution to the 401k plan and life insurance premiums paid on
behalf of the Named Executives as part of the employee benefit plan for
all employees, whereby each employee has a Company paid life insurance
policy in the amount of each employee’s annual
salary.
|
Option Awards
|
Stock Awards
|
|||||||||||||||||||||||||||||||
Name
|
Number of
Securities
Underlying
Unexercised
Options
Exercisable
|
Number of
Securities
Underlying
Unexercised
Unearned
Options
Unexercisable
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
|
Number of
Shares or
Units of
Stock That
Have Not
Vested
|
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)
|
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested ($)
|
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested ($)
|
||||||||||||||||||||||||
Vivian
H. Liu
|
12,000 | (4) | — | $ | 13.80 |
12/15/15
|
||||||||||||||||||||||||||
7,000 | (5) | — | $ | 10.50 |
12/16/12
|
|||||||||||||||||||||||||||
7,619 | (6) | — | $ | 8.25 |
12/3/12
|
|||||||||||||||||||||||||||
6,667 | (8) | — | $ | 12.15 |
8/3/16
|
|||||||||||||||||||||||||||
6,000 | (7) | — | $ | 60.00 |
1/9/10
|
|||||||||||||||||||||||||||
16,667 | (13) | $ | 382,500 | (3) | ||||||||||||||||||||||||||||
6,667 | (9) | $ | 147,000 | (3) | ||||||||||||||||||||||||||||
Bassam
B. Damaj (1)
|
— | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Mark
Westgate
|
5,000 | (4) | — | $ | 13.80 |
12/15/15
|
||||||||||||||||||||||||||
334 | (10) | — | $ | 19.80 |
1/18/15
|
|||||||||||||||||||||||||||
1819 | (6) | — | $ | 8.25 |
12/3/12
|
|||||||||||||||||||||||||||
1,000 | (11) | — | $ | 48.75 |
3/11/12
|
|||||||||||||||||||||||||||
5,334 | (8) | — | $ | 12.15 |
8/3/16
|
|||||||||||||||||||||||||||
16,667 | (12) | $ | 25,000 | (3) | ||||||||||||||||||||||||||||
6,667 | (9) | $ | 147,000 | (3) | ||||||||||||||||||||||||||||
Hemanshu
Pandya (2)
|
— | — | — | — | — | — | — |
(1)
|
Dr.
Damaj was appointed our President and Chief Executive Officer in December
2009.
|
(2)
|
Mr.
Pandya’s employment as our Chief Operating Officer ended in June 2009, at
which time all unvested awards were
forfeited.
|
(3)
|
Market
values were determined by multiplying the number of shares granted by the
closing market price of our common stock on the grant
date.
|
(4)
|
Options
vested in three equal installments on December 31, 2006, 2007 and
2008.
|
(5)
|
Options
vested in three equal installments on December 31, 2003, 2004 and
2005.
|
(6)
|
Options
vested on July 1, 2003.
|
(7)
|
Options
vested in three equal installments on January 19, 2001, 2002 and
2003.
|
(8)
|
Options
vested in two equal installments on the filing of the NDA for Vitaros in
September 2007 and the acceptance of the NDA for review by the FDA in
November 2007.
|
(9)
|
The
stock vests in two equal installments upon the re-submission of the NDA
for Vitaros and upon the FDA’s approval of the
NDA.
|
(10)
|
Options
vested on the grant date of January 18,
2005.
|
(11)
|
Options
vested in three equal installments on March 11, 2003, 2004 and
2005.
|
(12)
|
The
award vested on June 30, 2010.
|
(13)
|
The
award vested on June 18, 2010.
|
Name
|
Fees earned or
Paid in cash($)
|
Stock Awards ($)
(3)
|
Option Awards ($)
|
Total
($)
|
||||||||||||
Richard
J. Berman (1)
|
$ | 6,000 | $ | 120,776 | — | $ | 126,776 | |||||||||
Arthur
D. Emil, Esq. (2)
|
$ | 7,300 | $ | 62,963 | — | $ | 70,263 | |||||||||
Leonard
A. Oppenheim
|
$ | 7,900 | $ | 62,963 | — | $ | 70,863 | |||||||||
David
S. Tierney, M.D. (2)
|
$ | 4,900 | $ | 62,963 | — | $ | 67,863 | |||||||||
Martin
R. Wade, III (2)
|
$ | 7,200 | $ | 62,963 | — | $ | 70,163 | |||||||||
Roberto
Crea (3)
|
$ | 500 | — | — | $ | 500 | ||||||||||
Rusty
Ray (3)
|
$ | 500 | — | — | $ | 500 | ||||||||||
Deirdre
Y. Gillespie, M.D.(4)
|
— | — | — | — |
(1)
|
Mr.
Berman resigned from our Board in June
2010.
|
(2)
|
Messrs.
Emil, Tierney and Wade resigned from our Board in December
2009.
|
(3)
|
Messrs.
Crea and Ray were appointed to our Board in December
2009.
|
(4)
|
Dr.
Gillespie joined our Board in June
2010.
|
(5)
|
Market
values for stock awards granted for the annual retainer fees were
calculated based on the average of the closing price of our common stock
over five consecutive trading days, commencing on January 2,
2008.
|
Name
|
Title
|
Shares Issued upon
Completion of our
Merger with Bio-
Quant
|
Principal Amount of
Notes
|
Shares Issued upon
Repayment of Notes
(Principal plus Accrued
Interest)
|
||||||||||
Bassam
B. Damaj, Ph.D.
|
President
and Chief Executive Officer and Director
|
87,320 | $ | 3,974,635 | 1,015,656 | |||||||||
Henry
J. Esber, Ph.D.
|
Executive
Vice President and Director
|
44,966 | $ | 2,043,885 | 522,678 | |||||||||
Edward
M. Cox
|
Vice
President, Investor Relations and Corporate Development
|
6,683 | $ | 303,985 | 57,466 | |||||||||
Roberto
Crea, Ph.D.
|
Director
|
1,295 | $ | 58,892 | 11,133 |
|
•
|
each
beneficial owner of more than 5% of our outstanding common
stock;
|
|
•
|
each
of our named executive officers and
directors; and
|
|
•
|
all
of our executive officers and directors as a
group.
|
Name of Beneficial Owner
|
Shares
Beneficially
Owned
Before
Offering
|
Percentage of
Common
Stock
Beneficially
Owned
Before
Offering
|
Shares
Beneficially
Owned
After
Offering
|
Percentage of
Common
Stock
Beneficially
Owned
After
Offering
|
||||||||||||
Named
Executive Officers and Directors (1):
|
||||||||||||||||
Bassam
B. Damaj, Ph.D. (2)
|
1,102,976 | 8.6 | % | |||||||||||||
Henry
J. Esber, Ph.D. (3)
|
567,614 | 4.4 | % | |||||||||||||
Vivian
H. Liu (4)
|
182,686 | 1.4 | % | |||||||||||||
Leonard
A. Oppenheim (5)
|
49,655 | * | ||||||||||||||
Mark
Westgate (6)
|
55,440 | * | ||||||||||||||
Edward
M. Cox
|
113,079 | * | ||||||||||||||
Roberto
Crea, Ph.D.
|
23,628 | * | ||||||||||||||
Rusty
Ray
|
4,358 | * | ||||||||||||||
Deirdre
Y. Gillespie, M.D
|
654 | * | ||||||||||||||
All
named executive officers and directors as a group
(9 persons)
|
2,100,090 | 16.3 | % |
*
|
Less
than one percent (1%).
|
(1)
|
The
address for each of our executive officers and directors is 6330 Nancy
Ridge Drive, Suite 103, San Diego, California,
92121.
|
(2)
|
Includes
327,100 shares held by Dr. Damaj’s spouse. Dr. Damaj disclaims
beneficial ownership of these
shares.
|
(3)
|
Includes
192,412 shares held by Dr. Esber’s spouse. Dr. Esber disclaims beneficial
ownership of these shares.
|
(4)
|
Includes
33,286 shares issuable upon exercise of stock options exercisable within
60 days of July 31, 2010.
|
(5)
|
Includes
33,333 shares issuable upon exercise of stock options exercisable within
60 days of July 31, 2010.
|
(6)
|
Includes
13,485 shares issuable upon exercise of stock options exercisable within
60 days of July 31, 2010.
|
|
·
|
1,000,000
shares of our preferred stock as Series A Junior Participating Preferred
Stock, none of which have been
issued;
|
|
·
|
800
shares of our preferred stock as Series B 8% Cumulative Convertible
Preferred Stock, all previously outstanding shares of which have been
previously converted into shares of our common stock and may not be
reissued; and
|
|
·
|
600
shares of our preferred stock as Series C 6% Cumulative Convertible
Preferred Stock, all previously outstanding shares of which have been
previously converted into shares of our common stock and may not be
reissued.
|
|
·
|
acquisition
of us by means of a tender offer;
|
|
·
|
acquisition
of us by means of a proxy contest or otherwise;
or
|
|
·
|
removal
of our incumbent officers and
directors.
|
Page
|
||
Unaudited
Consolidated Financial Statements:
|
||
F-2
|
||
F-3
|
||
F-4
|
||
F-5
|
||
F-6
|
||
Audited
Consolidated Financial Statements:
|
||
F-18
|
||
F-19
|
||
F-20
|
||
F-21
|
||
F-22
|
||
|
F-23
|
|
June 30,
|
December 31,
|
||||||
2010
|
2009
|
|||||||
(Unaudited)
|
||||||||
Assets
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$
|
4,215,095
|
$
|
479,888
|
||||
Accounts
receivable
|
641,716
|
708,898
|
||||||
Other
receivable
|
-
|
437,794
|
||||||
Prepaid
expenses and other assets
|
257,581
|
140,521
|
||||||
Total
current assets
|
5,114,392
|
1,767,101
|
||||||
Fixed
assets, net
|
5,620,741
|
5,616,811
|
||||||
Goodwill
|
9,084,476
|
9,084,476
|
||||||
Restricted
cash
|
603,000
|
-
|
||||||
Intangible
assets, net of accumulated amortization
|
3,965,082
|
4,145,006
|
||||||
Due
from related party
|
-
|
204,896
|
||||||
Debt
issuance cost, net of accumulated amortization of $10,718 and
$169,304
|
92,972
|
115,047
|
||||||
Total
assets
|
$
|
24,480,663
|
$
|
20,933,337
|
||||
Liabilities and stockholders’
equity
|
||||||||
Current
liabilities:
|
||||||||
Notes
payable - former Bio-Quant shareholders
|
$
|
-
|
$
|
12,129,010
|
||||
Accounts
payable and accrued expenses
|
1,333,499
|
1,453,621
|
||||||
Payroll
related liabilities
|
418,083
|
279,960
|
||||||
Short-term
borrowing from banks
|
401,000
|
-
|
||||||
Deferred
revenue - current portion
|
107,108
|
118,115
|
||||||
Capital
lease payable - current portion
|
25,811
|
24,530
|
||||||
Due
to related parties
|
-
|
99,682
|
||||||
Deferred
compensation - current portion
|
68,596
|
70,000
|
||||||
Total
current liabilities
|
2,354,097
|
14,174,918
|
||||||
Long
term liabilities:
|
||||||||
Convertible
notes payable
|
4,000,000
|
2,990,000
|
||||||
Deferred
revenue
|
77,350
|
82,450
|
||||||
Capital
lease payable
|
101,374
|
114,965
|
||||||
Deferred
compensation
|
839,510
|
865,602
|
||||||
Total
liabilities
|
7,372,331
|
18,227,935
|
||||||
Commitments
and contingencies (Note 15)
|
||||||||
Stockholders’
equity:
|
||||||||
Common
stock, $.001 par value, 18,000,000 and 8,000,000
|
||||||||
shares
authorized, 12,626,541 and 6,988,105
|
||||||||
and
outstanding, respectively
|
12,626
|
6,988
|
||||||
Additional
paid-in capital
|
202,343,672
|
174,430,276
|
||||||
Accumulated
deficit
|
(185,247,966
|
)
|
(171,731,862
|
)
|
||||
Total
stockholders’ equity
|
17,108,332
|
2,705,402
|
||||||
Total
liabilities and stockholders’ equity
|
$
|
24,480,663
|
$
|
20,933,337
|
|
FOR THE THREE MONTHS
|
FOR THE SIX MONTHS ENDED
|
||||||||||||||
|
ENDED JUNE 30,
|
JUNE 30,
|
||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
License
fee revenue
|
$
|
32,550
|
$
|
102,613
|
$
|
35,100
|
$
|
2,569,283
|
||||||||
Contract
service revenue
|
1,438,377
|
-
|
2,881,579
|
-
|
||||||||||||
Total
revenue
|
1,470,927
|
102,613
|
2,916,679
|
2,569,283
|
||||||||||||
Cost
of services
|
1,021,951
|
-
|
2,059,183
|
-
|
||||||||||||
Gross
profit
|
448,976
|
102,613
|
857,496
|
2,569,283
|
||||||||||||
Costs
and expenses
|
||||||||||||||||
Research
and development
|
477,566
|
716,453
|
903,959
|
1,318,819
|
||||||||||||
General
and administrative
|
2,640,400
|
694,749
|
4,879,936
|
1,785,796
|
||||||||||||
Total
costs and expenses
|
3,117,966
|
1,411,202
|
5,783,895
|
3,104,615
|
||||||||||||
Loss
from operations
|
(2,668,990
|
)
|
(1,308,589
|
)
|
(4,926,399
|
)
|
(535,332
|
)
|
||||||||
Interest
expense, net
|
(1,609,657
|
)
|
(117,569
|
)
|
(8,589,704
|
)
|
(206,054
|
)
|
||||||||
Net
loss
|
$
|
(4,278,648
|
)
|
$
|
(1,426,158
|
)
|
$
|
(13,516,104
|
)
|
$
|
(741,386
|
)
|
||||
Basic
and diluted loss per common share
|
$
|
(0.47
|
)
|
$
|
(0.25
|
)
|
$
|
(1.64
|
)
|
$
|
(0.13
|
)
|
||||
Weighted
average common shares outstanding
|
||||||||||||||||
used
for basic and diluted loss per share
|
9,140,451
|
5,625,895
|
8,264,515
|
5,641,166
|
Common
|
Common
|
Additional
|
Total
|
|||||||||||||||||
Stock
|
Stock
|
Paid-In
|
Accumulated
|
Stockholders’
|
||||||||||||||||
(Shares)
|
(Amount)
|
Capital
|
Deficit
|
Equity
|
||||||||||||||||
Balance
at December 31, 2009
|
6,988,105
|
$
|
6,988
|
$
|
174,430,276
|
$
|
(171,731,862
|
)
|
$
|
2,705,402
|
||||||||||
Issuance
of compensatory stock to employees
|
-
|
-
|
1,114,936
|
-
|
1,114,936
|
|||||||||||||||
Issuance
of compensatory stock to the board of directors
|
8,715
|
9
|
79,991
|
-
|
80,000
|
|||||||||||||||
Issuance
of common stock, net of offering costs
|
518,264
|
518
|
3,298,522
|
-
|
3,299,040
|
|||||||||||||||
Issuance
of common stock in payment of convertible notes payable
|
468,837
|
469
|
4,578,362
|
-
|
4,578,831
|
|||||||||||||||
Issuance
of common stock in payment of notes payable to the former Bio-Quant
shareholders
|
4,642,620
|
4,642
|
18,841,585
|
-
|
18,846,227
|
|||||||||||||||
Net
loss
|
-
|
-
|
-
|
(13,516,104
|
)
|
(13,516,104
|
)
|
|||||||||||||
Balance
at June 30, 2010
|
12,626,541
|
$
|
12,626
|
$
|
202,343,672
|
$
|
(185,247,966
|
)
|
$
|
17,108,332
|
FOR THE SIX MONTHS ENDED
|
||||||||
|
JUNE 30,
|
|||||||
2010
|
2009
|
|||||||
Cash
flows from operating activities
|
||||||||
Net
loss
|
$
|
(13,516,104
|
)
|
$
|
(741,386
|
)
|
||
Adjustments
to reconcile net loss to net cash used in operating
activities
|
||||||||
Depreciation
and amortization
|
471,398
|
201,767
|
||||||
Non-cash
interest, amortization of beneficial conversion feature and deferred
financing costs
|
|
|
8,716,575
|
|
|
|
51,762
|
|
Non-cash
compensation expense
|
1,194,927
|
573,234
|
||||||
(Gain)
loss on disposal of fixed assets
|
312
|
(42,869
|
)
|
|||||
Increase
in prepaid expenses and other assets
|
(117,060
|
)
|
(65,797
|
)
|
||||
Decrease
in accounts receivable
|
67,182
|
-
|
||||||
Decrease
in other receivable
|
437,794
|
-
|
||||||
Decrease
in due from related party
|
204,896
|
|||||||
Decrease
in accounts payable and accrued expenses
|
(120,122
|
)
|
(198,583
|
)
|
||||
Increase
(decrease) in payroll related liabilities
|
138,124
|
(232,722
|
)
|
|||||
Decrease
in due to related party
|
(99,682
|
)
|
-
|
|||||
Decrease
in deferred compensation
|
(27,496
|
)
|
(41,873
|
)
|
||||
(Decrease)
increase in deferred revenue
|
(16,107
|
)
|
147,750
|
|||||
Net
cash used in operating activities
|
(2,665,363
|
)
|
(348,717
|
)
|
||||
Cash
flows from investing activities
|
||||||||
Proceeds
from sale of fixed assets
|
1,142
|
350,000
|
||||||
Capital
expenditures
|
(296,856
|
)
|
(2,928
|
)
|
||||
Net
cash (used in) provided by investing activities
|
(295,714
|
)
|
347,072
|
|||||
Cash
flows from financing activities
|
||||||||
Proceeds
from issuance of notes payable
|
2,300,000
|
-
|
||||||
Proceeds
from issuance of convertible notes payable, net of debt issue
costs
|
3,896,310
|
-
|
||||||
Issuance
of common stock, net of offering costs
|
3,306,296
|
-
|
||||||
Proceeds
from short-term borrowing
|
401,000
|
-
|
||||||
Repayment
of convertible notes payable
|
(2,592,012
|
)
|
(50,000
|
)
|
||||
Repayment
of capital lease obligations
|
(12,310
|
)
|
-
|
|||||
Net
cash provided by (used in) financing activities
|
7,299,284
|
(50,000
|
)
|
|||||
Net
change in cash and cash equivalents
|
4,338,207
|
(51,645
|
)
|
|||||
Cash
and cash equivalents, beginning of period
|
$
|
479,888
|
$
|
2,862,960
|
||||
Cash
and cash equivalents, end of period
|
$
|
4,818,095
|
$
|
2,811,315
|
||||
Supplemental
Information:
|
||||||||
Issuance
of common stock in payment of convertible notes payable
|
$
|
397,888
|
$
|
300,000
|
||||
Issuance
of common stock in payment of notes payable to
|
||||||||
former
Bio-Quant shareholders
|
$
|
12,129,010
|
$
|
-
|
||||
Cash
paid for interest
|
$
|
67,762
|
$
|
-
|
1.
|
BASIS
OF PRESENTATION
|
2.
|
ACQUISITION
|
Fair
value of 266,667 shares of common stock issued for Bio-Quant common stock
(1)
|
$
|
1,600
|
||
Fair
value of promissory notes issued for Bio-Quant common
stock
|
12,129
|
|||
Total
consideration
|
$
|
13,729
|
Cash & cash equivalents
|
$
|
151
|
||
Accounts receivable
|
576
|
|||
Prepaids and other current assets
|
105
|
|||
Other assets
|
27
|
|||
Property and equipment
|
783
|
|||
Due
from related party
|
205
|
|||
Accounts payable and accrued expenses
|
(1,041
|
)
|
||
Related party payable
|
(85
|
)
|
||
Deferred revenue
|
(45
|
)
|
||
Other
current liabilities
|
(68
|
)
|
||
Other long term liabilities
|
(122
|
)
|
||
Amortizable
intangible assets:
|
||||
Know-How
|
3,037
|
|||
Trade Name
|
1,123
|
|||
Indefinite
lived intangible assets:
|
||||
Goodwill
|
9,083
|
|||
Total net assets acquired
|
$
|
13,729
|
Six Months Ended
June 30, 2009
|
||||||||
|
As Presented
|
Pro Forma
|
||||||
Revenues
|
$
|
2,569,283
|
$
|
5,645,154
|
||||
Net
(loss) income
|
(741,386
|
)
|
531,408
|
|||||
Net
(loss) income per basic and diluted shares
|
$
|
(0.13
|
)
|
$
|
0.09
|
3.
|
ACCOUNTING
FOR STOCK BASED COMPENSATION
|
|
Options Outstanding
|
|||||||||||||
|
Weighted Average
|
Aggregate
|
||||||||||||
Range of
|
Number
|
Remaining
|
Weighted Average
|
Intrinsic
|
||||||||||
Exercise Prices
|
Outstanding
|
Contractual Life
|
Exercise Price
|
Value
|
||||||||||
$
|
8.25
- 21.00
|
145,104
|
5.24
years
|
$
|
11.99
|
$
|
-
|
|||||||
48.75
- 52.50
|
3,667
|
2.08
years
|
51.47
|
-
|
||||||||||
73.50
- 74.10
|
8,000
|
3.45
years
|
73.70
|
-
|
||||||||||
156,771
|
5.06
years
|
$
|
16.07
|
$
|
-
|
Weighted
|
Weighted
|
Total
|
|||||||||||
Average
|
Average Remaining
|
Aggregate
|
|||||||||||
Number
of
|
Exercise
|
Contractual
|
Intrinsic
|
||||||||||
Shares
|
Price
|
Term
|
Value
|
||||||||||
Outstanding
at December 31, 2009
|
196,713
|
$
|
21.00
|
-
|
|||||||||
Granted
|
-
|
-
|
|||||||||||
Exercised
|
-
|
-
|
-
|
||||||||||
Forfeited
|
(39,943
|
)
|
40.05
|
-
|
|||||||||
Outstanding
at June 30, 2010
|
156,771
|
16.07
|
5.06
years
|
-
|
|||||||||
Vested
or expected to vest at June 30, 2010
|
156,771
|
1.07
|
5.06
years
|
-
|
|||||||||
Exercisable
at June 30, 2010
|
156,771
|
$
|
1.07
|
5.06
years
|
-
|
FOR THE THREE MONTHS
|
FOR THE SIX MONTHS
|
|||||||||||||||
|
ENDED JUNE 30,
|
ENDED JUNE 30,
|
||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Research
and development
|
$
|
10,284
|
$
|
47,515
|
$
|
10,284
|
$
|
61,576
|
||||||||
General
and administrative
|
1,040,090
|
284,731
|
1,184,643
|
511,658
|
||||||||||||
Stock-based
compensation expense
|
$
|
1,050,374
|
$
|
332,246
|
$
|
1,194,927
|
$
|
573,234
|
4.
|
WARRANTS
|
|
Common Shares
|
Average
|
Average
|
||||||
|
Issuable upon
|
Exercise
|
Contractual
|
||||||
|
Exercise
|
Price
|
Life
|
||||||
Outstanding
at December 31, 2009
|
465,275
|
$
|
15.45
|
1.03
years
|
|||||
Issued
|
-
|
||||||||
Exercised
|
-
|
||||||||
Expired
|
(214,380
|
)
|
$
|
16.65
|
|||||
Outstanding
at June 30, 2010
|
250,895
|
$
|
12.76
|
1.37
years
|
|||||
Exercisable
at June 30, 2010
|
250,895
|
$
|
12.76
|
1.37
years
|
5.
|
LOSS
PER SHARE
|
FOR THE THREE MONTHS
|
FOR THE SIX MONTHS ENDED
|
|||||||||||||||
|
ENDED JUNE 30,
|
JUNE 30,
|
||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||
Net
loss
|
$
|
(4,278,648
|
)
|
$
|
(1,426,158
|
)
|
$
|
(13,516,104
|
)
|
$
|
(741,386
|
)
|
||||
Weighted
average common shares outstanding used for basic and diluted loss per
share
|
9,140,451
|
5,625,895
|
8,264,515
|
5,641,166
|
||||||||||||
Basic
and diluted loss per common share
|
$
|
(0.47
|
)
|
$
|
(0.25
|
)
|
$
|
(1.64
|
)
|
$
|
(0.13
|
)
|
6.
|
INTANGIBLE
ASSETS
|
|
June 30,
2010
|
December
31, 2009
|
||||||
Bio-Quant
Know-How
|
$
|
3,037,000
|
3,037,000
|
|||||
Bio-Quant
Trade Name
|
1,123,000
|
1,123,000
|
||||||
Accumulated
amortization
|
(194,918
|
)
|
(14,994
|
)
|
||||
Intangible
assets, net
|
$
|
3,965,082
|
4,145,006
|
2011
|
$
|
359,860
|
||
2012
|
359,860
|
|||
2013
|
359,860
|
|||
2014
|
359,860
|
|||
2015
|
359,860
|
|||
Thereafter
|
2,165,782
|
|||
|
||||
Total
future amortization expense
|
$
|
3,965,082
|
7.
|
CONVERTIBLE
NOTES PAYABLE
|
8.
|
NOTES
PAYABLE
|
9.
|
LINES
OF CREDIT
|
10.
|
DEFERRED
COMPENSATION
|
11.
|
COMMON
STOCK
|
12.
|
RELATED
PARTY TRANSACTIONS
|
13.
|
INCOME
TAXES
|
14.
|
LICENSING
AND RESEARCH AND DEVELOPMENT
AGREEMENTS
|
15.
|
COMMITMENTS
AND CONTINGENCIES
|
16.
|
SEGMENT
INFORMATION
|
NexACT Drug
Delivery
|
Bio-Quant CRO
|
Other Corporate
Not Allocated to
Segments
|
Consolidated
Total
|
|||||||||||||
Revenue
|
$ | 35,100 | $ | 2,812,679 | $ | 68,900 | $ | 2,916,679 | ||||||||
Cost
of Services
|
- | 2,046,399 | - | 2,046,399 | ||||||||||||
Gross
Profit
|
$ | 2,550 | $ | 766,280 | $ | - | $ | 870,280 | ||||||||
Costs
and expenses
|
||||||||||||||||
Research
and development
|
916,743 | - | - | 916,743 | ||||||||||||
General
and administrative
|
- | 1,593,627 | 3,286,309 | 4,879,936 | ||||||||||||
Loss
from operations
|
$ | (914,193 | ) | $ | (827,347 | ) | $ | (3,286,309 | ) | $ | (4,926,399 | ) | ||||
Total
assets
|
$ | - | $ | 15,045,423 | $ | 9,435,240 | $ | 24,480,663 | ||||||||
Capital
expenditures
|
$ | - | $ | 295,052 | $ | 1,804 | $ | 296,856 |
/s/
Amper, Politziner & Mattia, LLP
|
|
March
31, 2010
|
|
Edison,
New Jersey
|
December
31,
|
||||||||
2009
|
2008
|
|||||||
Assets
|
||||||||
Current
assets
|
||||||||
Cash
and cash equivalents
|
$ | 479,888 | $ | 2,862,960 | ||||
Accounts
receivable
|
708,898 | - | ||||||
Other
receivable
|
437,794 | - | ||||||
Prepaid
expenses and other current assets
|
140,521 | 83,761 | ||||||
Total
current assets
|
1,767,101 | 2,946,721 | ||||||
Fixed
assets, net
|
5,616,811 | 5,519,652 | ||||||
Goodwill
|
9,084,476 | - | ||||||
Intangible
assets, net of accumulated amortization
|
4,145,006 | - | ||||||
Due
from related party
|
204,896 | - | ||||||
Debt
issuance cost, net of accumulated amortization of $169,304 and
$129,980
|
115,047 | 91,139 | ||||||
Total
assets
|
$ | 20,933,337 | $ | 8,557,512 | ||||
Liabilities
and Stockholders’ Equity
|
||||||||
Current
liabilities
|
||||||||
Notes
payable - former Bio-Quant shareholders
|
$ | 12,129,010 | $ | - | ||||
Accounts
payable and accrued expenses
|
1,453,621 | 1,029,486 | ||||||
Payroll
related liabilities
|
279,960 | 296,135 | ||||||
Deferred
revenue
|
118,115 | - | ||||||
Capital
lease payable - current portion
|
24,530 | - | ||||||
Due
to related parties
|
99,682 | - | ||||||
Deferred
compensation - current portion
|
70,000 | 74,245 | ||||||
Total
current liabilities
|
14,174,918 | 1,399,866 | ||||||
Long
term liabilities
|
||||||||
Convertible
notes payable
|
2,990,000 | 4,690,000 | ||||||
Deferred
revenue
|
82,450 | - | ||||||
Capital
lease payable
|
114,965 | - | ||||||
Deferred
compensation
|
865,602 | 935,517 | ||||||
Total
liabilities
|
18,227,935 | 7,025,383 | ||||||
Commitments
and contingencies (Note 16)
|
||||||||
Stockholders’
equity:
|
||||||||
Common
stock, $.001 par value, 8,000,000 shares authorized, 6,988,105 and
5,623,357 shares issued and outstanding, respectively
|
6,988 | 5,623 | ||||||
Additional
paid-in capital
|
174,430,276 | 141,215,806 | ||||||
Accumulated
deficit
|
(171,731,862 | ) | (139,689,300 | ) | ||||
Total
stockholders’ equity
|
2,705,402 | 1,532,129 | ||||||
Total
liabilities and stockholders’ equity
|
$ | 20,933,337 | $ | 8,557,512 |
For
the Year Ended
|
||||||||||||
December
31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
License
fee revenue
|
$ | 2,681,271 | $ | 5,957,491 | $ | 1,270,367 | ||||||
Contract
service revenue
|
292,437 | - | - | |||||||||
Total
Revenue
|
2,973,708 | 5,957,491 | 1,270,367 | |||||||||
Cost
of Services
|
128,355 | - | - | |||||||||
Gross
Profit
|
2,845,353 | 5,957,491 | 1,270,367 | |||||||||
Costs
and expenses
|
||||||||||||
Research
and development
|
1,883,458 | 5,410,513 | 5,022,671 | |||||||||
General
and administrative
|
4,196,359 | 5,720,832 | 5,634,479 | |||||||||
Acquisition
costs
|
585,378 | - | - | |||||||||
Total
costs and expenses
|
6,665,195 | 11,131,345 | 10,657,150 | |||||||||
Loss
from operations
|
(3,819,842 | ) | (5,173,854 | ) | (9,386,783 | ) | ||||||
Other
income (expense)
|
||||||||||||
Interest
income
|
25,291 | 71,793 | 275,508 | |||||||||
Other
income
|
10,201 | - | - | |||||||||
Interest
expense
|
(28,696,006 | ) | (1,006,794 | ) | (481,862 | ) | ||||||
Total
other income (expense)
|
(28,660,514 | ) | (935,001 | ) | (206,354 | ) | ||||||
Loss
before benefit from income taxes
|
(32,480,356 | ) | (6,108,855 | ) | (9,593,137 | ) | ||||||
Benefit
from income taxes
|
437,794 | 937,657 | 805,909 | |||||||||
Net
loss
|
$ | (32,042,562 | ) | $ | (5,171,198 | ) | $ | (8,787,228 | ) | |||
Basic
and diluted loss per share
|
$ | (5.43 | ) | $ | (.93 | ) | $ | (1.61 | ) | |||
Weighted
average common shares outstanding used for basic and diluted loss per
share
|
5,906,455 | 5,578,987 | 5,467,727 |
Accumulated
|
||||||||||||||||||||||||
Common
|
Common
|
Additional
|
Other
|
Total
|
||||||||||||||||||||
Stock
|
Stock
|
Paid-In
|
Accumulated
|
Comprehensive
|
Stockholders’
|
|||||||||||||||||||
(Shares)
|
(Amount)
|
Capital
|
Deficit
|
Income
|
Equity
|
|||||||||||||||||||
Balance
at January 1, 2007
|
5,352,394 | $ | 5,352 | $ | 137,239,593 | $ | (125,730,874 | ) | $ | (9,596 | ) | $ | 11,504,475 | |||||||||||
Issuance
of common stock upon exercise of stock options and warrants,
net
|
114,530 | 115 | 220,778 | - | - | 220,893 | ||||||||||||||||||
Issuance
of compensatory options to employees and consultants
|
- | - | 776,835 | - | - | 776,835 | ||||||||||||||||||
Issuance
of compensatory stock to employees and consultants
|
40,600 | 41 | 89,959 | - | - | 90,000 | ||||||||||||||||||
Issuance
of common stock in payment of interest on notes
|
9,708 | 10 | 190,738 | - | - | 190,748 | ||||||||||||||||||
Issuance
of compensatory stock to the board of directors
|
20,303 | 20 | 288,978 | - | - | 288,998 | ||||||||||||||||||
Net
offering costs from issuance of common stock
|
- | - | (2,110 | ) | - | - | (2,110 | ) | ||||||||||||||||
Discount
on Note payable for issuance of warrants
|
- | - | 512,550 | - | - | 512,550 | ||||||||||||||||||
Realized
gain on foreign currency exchange
|
9,596 | 9,596 | ||||||||||||||||||||||
Net
loss
|
- | - | - | (8,787,228 | ) | - | (8,787,228 | ) | ||||||||||||||||
Balance
at December 31, 2007
|
5,537,535 | $ | 5,538 | $ | 139,317,321 | $ | (134,518,102 | ) | - | $ | 4,804,757 | |||||||||||||
Issuance
of common stock upon exercise of stock options and
warrants
|
35,125 | 35 | 459,713 | - | - | 459,748 | ||||||||||||||||||
Issuance
of compensatory options to employees and consultants
|
- | - | 138,511 | - | - | 138,511 | ||||||||||||||||||
Issuance
of compensatory stock to employees and consultants
|
25,500 | 25 | 704,707 | - | - | 704,732 | ||||||||||||||||||
Issuance
of compensatory stock to the board of directors
|
25,197 | 25 | 480,804 | - | - | 480,829 | ||||||||||||||||||
Discount
on Note payable for issuance of warrants
|
- | - | 114,750 | - | - | 114,750 | ||||||||||||||||||
Net
loss
|
- | - | - | (5,171,198 | ) | - | (5,171,198 | ) | ||||||||||||||||
Balance
at December 31, 2008
|
5,623,357 | $ | 5,623 | $ | 141,215,806 | $ | (139,689,300 | ) | - | $ | 1,532,129 | |||||||||||||
Issuance
of compensatory stock to employees and consultants
|
54,025 | 54 | 691,189 | - | - | 691,243 | ||||||||||||||||||
Issuance
of compensatory stock to the board of directors
|
16,899 | 17 | 211,411 | - | - | 211,428 | ||||||||||||||||||
Issuance
of common stock to the Bio-Quant shareholders as consideration for the
acquisition
|
266,667 | 267 | 1,599,733 | - | - | 1,600,000 | ||||||||||||||||||
Issuance
of common stock in payment of convertible notes payable
|
1,023,824 | 1,024 | 30,712,140 | - | - | 30,713,164 | ||||||||||||||||||
Issuance
of common stock to warrant holders for early forfeiture
|
3,333 | 3 | (3 | ) | - | - | 0 | |||||||||||||||||
Net
loss
|
- | - | - | (32,042,562 | ) | - | (32,042,562 | ) | ||||||||||||||||
Balance
at December 31, 2009
|
6,988,105 | $ | 6,988 | $ | 174,430,276 | $ | (171,731,862 | ) | - | $ | 2,705,402 |
For
the Year Ended
|
||||||||||||
December
31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
loss
|
$ | (32,042,562 | ) | $ | (5,171,198 | ) | $ | (8,787,228 | ) | |||
Adjustments
to reconcile net loss to net cash used in operating
activities
|
||||||||||||
Depreciation
and amortization
|
387,708 | 486,420 | 621,869 | |||||||||
Non-cash
interest, amortization of debt discount and deferred financing
costs
|
28,352,598 | 693,316 | 408,538 | |||||||||
Non-cash
compensation expense
|
902,671 | 1,324,072 | 1,155,832 | |||||||||
Net
gain on foreign currency exchange
|
- | - | 9,596 | |||||||||
(Gain)
loss on disposal of property and equipment
|
(31,345 | ) | 904,902 | 10,121 | ||||||||
Changes
in assets and liabilities, net of amounts acquired from Bio-Quant,
Inc.
|
||||||||||||
Increase
in accounts receivable
|
(132,960 | ) | - | - | ||||||||
(Increase)
decrease in other receivable
|
(437,794 | ) | - | 183,700 | ||||||||
Decrease
in prepaid expense and other assets
|
73,817 | 43,898 | 37,239 | |||||||||
Increase
(decrease) in deferred revenue
|
189,980 | (953,528 | ) | (740,389 | ) | |||||||
(Decrease)
increase in payroll related liabilities
|
(16,175 | ) | (397,639 | ) | 537,207 | |||||||
(Decrease)
increase in deferred compensation
|
(74,160 | ) | (50,512 | ) | (58,036 | ) | ||||||
(Decrease)
increase in accounts payable and accrued expenses
|
(686,427 | ) | 407,818 | 33,918 | ||||||||
Net
cash used in operating activities
|
(3,514,649 | ) | (2,712,451 | ) | (6,587,633 | ) | ||||||
Cash
flows from investing activities
|
||||||||||||
Capital
expenditures
|
(5,526 | ) | (28,988 | ) | (100,875 | ) | ||||||
Proceeds
from sale of fixed assets
|
350,000 | 75,000 | - | |||||||||
Purchases
of short term investments
|
- | - | (3,000,000 | ) | ||||||||
Proceeds
from sale of short term investments
|
750,000 | 3,250,000 | ||||||||||
Net
cash provided by investing activities
|
344,474 | 796,012 | 149,125 | |||||||||
Cash
flows from financing activities
|
||||||||||||
Issuance
of convertible notes payable, net of debt issue costs
|
686,678 | 5,643,711 | - | |||||||||
Repayment
of notes payable
|
(50,000 | ) | (4,000,000 | ) | (2,000,000 | ) | ||||||
Proceeds
from exercise of stock options and warrants
|
459,748 | 220,893 | ||||||||||
Issuance
of notes payable, net of debt issue costs
|
- | - | 2,886,532 | |||||||||
Issuance
of common stock, net of offering costs
|
- | - | (2,110 | ) | ||||||||
Repayment
of convertible notes payable
|
(60,000 | ) | (3,000,000 | ) | ||||||||
Principal
payments on capital lease obligations
|
(601 | ) | - | - | ||||||||
Net
cash provided by (used in) financing activities
|
636,077 | 2,043,459 | (1,894,685 | ) | ||||||||
Net
increase (decrease) in cash and cash equivalents
|
(2,534,098 | ) | 127,020 | (8,333,193 | ) | |||||||
Cash
and cash equivalents
|
||||||||||||
Beginning
of period
|
3,013,986 | 2,735,940 | 11,069,133 | |||||||||
End
of period
|
$ | 479,888 | $ | 2,862,960 | $ | 2,735,940 | ||||||
Cash
paid for interest
|
$ | 303,652 | $ | 324,314 | $ | 119,307 | ||||||
Supplemental
disclosure of non-cash investing and financing activities:
|
||||||||||||
Issuance
of notes to former Bio-Quant shareholders upon acquisition
|
$ | 12,129,010 | $ | - | $ | - | ||||||
Issuance
of common stock in payment of convertible notes payable
|
$ | 3,475,377 | $ | - | $ | - | ||||||
Issuance
of 4 million shares of common stock to former Bio-Quant shareholders upon
acquisition
|
$ | 1,600,000 | $ | - | $ | - | ||||||
Payment
of interest in common stock
|
$ | 21,247 | $ | - | $ | 190,748 | ||||||
Amortization
of debt discount
|
$ | - | $ | 461,295 | $ | 178,640 |
Notes
to Consolidated Financial
Statements
|
|
1.
|
Organization,
Basis of Presentation and Liquidity
|
|
2.
|
Summary
of Significant Accounting
Principles
|
|
3.
|
Acquisition
|
Fair
value of 266,667 shares of common stock issued for Bio-Quant common stock
|
$ | 1,600 | ||
Fair
value of promissory notes issued for Bio-Quant common
stock
|
12,129 | |||
Total
consideration
|
$ | 13,729 |
Cash
& cash equivalents
|
$ | 151 | ||
Accounts
receivable
|
576 | |||
Prepaids
and other current assets
|
105 | |||
Other
assets
|
27 | |||
Property
and equipment
|
783 | |||
Due
from related party
|
205 | |||
Accounts
payable and accrued expenses
|
(1,041 | ) | ||
Related
party payable
|
(85 | ) | ||
Deferred
revenue
|
(45 | ) | ||
Other
current liabilities
|
(68 | ) | ||
Other
long term liabilities
|
(122 | ) | ||
Amortizable
intangible assets:
|
||||
Know-How
|
3,037 | |||
Trade
Name
|
1,123 | |||
Indefinite
lived intangible assets:
|
||||
Goodwill
|
9,083 | |||
Total
net assets acquired
|
$ | 13,729 |
Year Ended
December 31,
2009
|
Year Ended
December 31,
2008
|
|||||||||||||||
As
Presented
|
Pro
Forma
|
As Presented
|
Pro Forma
|
|||||||||||||
Revenues
|
$ | 2,974 | $ | 8,715 | $ | 5,957 | $ | 10,998 | ||||||||
Net
Loss
|
(32,043 | ) | (32,196 | ) | (5,171 | ) | (8,686 | ) | ||||||||
Net
loss per basic and diluted shares
|
$ | (5.43 | ) | $ | (5.43 | ) | $ | (0.93 | ) | $ | (1.50 | ) |
|
4.
|
Licensing
and Research and Development
Agreements
|
|
5.
|
Fixed
Assets
|
|
2009
|
2008
|
||||||
Land
|
$
|
363,909
|
$
|
363,909
|
||||
Building,
including impairment charge of $884,271 in 2008
|
6,042,583
|
6,378,587
|
||||||
Leasehold
improvements
|
650,991
|
-
|
||||||
Machinery
and equipment
|
2,517,256
|
2,599,159
|
||||||
Computer
software
|
622,313
|
600,167
|
||||||
Furniture
and fixtures
|
253,846
|
188,935
|
||||||
10,450,898
|
10,130,757
|
|||||||
Less:
accumulated depreciation and amortization
|
(4,834,087
|
)
|
(4,611,105
|
)
|
||||
$
|
5,616,811
|
$
|
5,519,652
|
6.
|
Intangible
Assets
|
Bio-Quant Know-How
|
$
|
3,037,000
|
||
Bio-Quant
Trade Name
|
1,123,000
|
|||
Accumulated
amortization
|
(14,994
|
)
|
||
Intangible
assets, net
|
$
|
4,145,006
|
2010
|
$
|
359,860
|
||
2011
|
359,860
|
|||
2012
|
359,860
|
|||
2013
|
359,860
|
|||
2014
|
359,860
|
|||
Thereafter
|
2,345,706
|
|||
Total
future amortization expense
|
$
|
4,145,006
|
|
7.
|
Deferred
Compensation
|
|
8.
|
Convertible
Notes Payable
|
9.
|
Notes
Payable
|
10.
|
Related
Party Transactions
|
|
·
|
At
December 31, 2009 $14,703 is included in due to related parties in the
accompanying consolidated balance sheets for amounts owed to the Chief
Executive Officer and affiliates for certain consulting and supplies
purchased by the Company. There are charges of $2,500 related
to such consulting services in the statement of operations for the 2009
period since the Merger.
|
|
·
|
Prior
to Merger, Bio-Quant had promissory notes receivable of approximately
$380,000 from three entities controlled by the former Bio-Quant
shareholders. Management of the Company has determined that the
fair value of these notes was $204,896, representing the value of
Prevonco™ purchased in 2010 by the Company from one of these entities in
settlement of a like-amount of the promissory note. Prevonco™
is a marketed anti-ulcer compound, lansoprazole, for the treatment of
solid tumors. The remainder of the notes receivable have been assigned no
fair value, as there is significant uncertainty as to whether any amounts
will be collectible.
|
|
·
|
Prior
to the Merger, Bio-Quant periodically borrowed and repaid funds from the
Company’s Chief Executive Officer and his affiliates pursuant to
promissory notes bearing interest rate of 10% per annum, The balance owed
by the Company at December 31, 2009 and included in due to related parties
in the accompanying consolidated balance sheet is $84,979. These amounts
have been repaid in full during the first quarter of
2010.
|
11.
|
Stock
Options and Restricted Stock
|
|
Options Outstanding
|
||||||||||||||
|
Weighted Average
|
Aggregate
|
|||||||||||||
Range of
|
Number
|
Remaining
|
Weighted Average
|
Intrinsic
|
|||||||||||
Exercise Prices
|
Outstanding
|
Contractual Life
|
Exercise Price
|
Value
|
|||||||||||
$ | 8.25 – 27.75 | 166,097 |
5.72
years
|
$ | 12.30 | $ | - | ||||||||
30.00 – 59.85 | 5,157 |
2.27
years
|
49.65 | - | |||||||||||
60.00 - 82.50 | 24,760 |
2.75
years
|
69.75 | - | |||||||||||
105.00 - 180.00 | 700 |
0.53
years
|
137.10 | - | |||||||||||
196,714 |
5.24
years
|
$ | 21.00 | $ | - |
|
Weighted
|
Weighted
|
Total
|
||||||||||
|
Average
|
Average Remaining
|
Aggregate
|
||||||||||
|
Number of
|
Exercise
|
Contractual
|
Intrinsic
|
|||||||||
|
Shares
|
Price
|
Life
|
Value
|
|||||||||
Outstanding
at January1, 2007
|
244,228
|
$
|
22.80
|
||||||||||
Granted
|
13,473
|
21.15
|
|||||||||||
Exercised
|
(5,232
|
)
|
16.05
|
||||||||||
Cancelled
|
(21,147
|
)
|
42.30
|
||||||||||
Outstanding
at December 31, 2007
|
231,322
|
$
|
21.15
|
||||||||||
Granted
|
-
|
||||||||||||
Exercised
|
(3,666
|
)
|
$
|
10.95
|
|||||||||
Cancelled
|
(3,056
|
)
|
49.95
|
||||||||||
Outstanding
at December 31, 2008
|
224,600
|
$
|
21.00
|
||||||||||
Granted
|
-
|
||||||||||||
Exercised
|
-
|
||||||||||||
Cancelled
|
(27,886
|
)
|
$
|
21.00
|
|||||||||
Outstanding
at December 31, 2009
|
196,714
|
5.24 years
|
$
|
0
|
|||||||||
Vested
or expected to vest at
|
|||||||||||||
December
31, 2009
|
196,714
|
$
|
21.00
|
5.24 years
|
$
|
0
|
|||||||
Exercisable
at December 31, 2009
|
196,714
|
$
|
21.00
|
5.24 years
|
$
|
0
|
|||||||
Exercisable
at December 31, 2008
|
211,840
|
$
|
21.00
|
||||||||||
Exercisable
at December 31, 2007
|
208,183
|
$
|
21.45
|
||||||||||
Options
available for grant at December 31, 2009
|
88,204
|
Dividend
yield
|
0.00
|
%
|
||
Risk-free
yields
|
1.35% - 5.02
|
%
|
||
Expected
volatility
|
54.38% - 103.51
|
%
|
||
Expected
option life
|
1 - 6 years
|
|||
Forfeiture
rate
|
8.22
|
%
|
|
Year Ended
|
|||||||||||
|
December 31, 2009
|
December 31, 2008
|
December 31, 2007
|
|||||||||
Research
and development
|
$
|
86,210
|
$
|
71,833
|
$
|
111,108
|
||||||
General
and administrative
|
816,461
|
1,252,239
|
1,044,724
|
|||||||||
Total
stock-based compensation expense
|
$
|
902,671
|
$
|
1,324,072
|
$
|
1,155,832
|
12.
|
Capital
Leases
|
|
Monthly
payment
|
Interest
rate
|
Number
of
payments
per lease
|
Maturity
date
|
Aggregate
remaining
principal
outstanding
at December
31, 2009
|
||||||||||||
Lease
1
|
$
|
384
|
10
|
%
|
60
|
12/1/2013
|
$
|
14,901
|
|||||||||
Lease
2
|
136
|
19.2
|
%
|
36
|
12/31/2011
|
2,685
|
|||||||||||
Lease
3
|
441
|
13.7
|
%
|
60
|
2/1/2013
|
16,717
|
|||||||||||
Lease
4
|
897
|
10
|
%
|
60
|
9/1/2013
|
41,155
|
|||||||||||
Lease
5
|
1,483
|
13.8
|
%
|
60
|
12/1/2014
|
64,037
|
|||||||||||
$
|
139,495
|
Years Ended
December 31,
|
Amount
|
|||
2010
|
$
|
40,101
|
||
2011
|
40,101
|
|||
2012
|
38,473
|
|||
2013
|
31,374
|
|||
2014
|
17,800
|
|||
Total
|
167,849
|
|||
Less
portion representing interest
|
28,354
|
|||
Total
principal due at December 31, 2009
|
139,495
|
|||
Less:
current maturities
|
24,530
|
|||
Long-term
portion
|
$
|
114,965
|
13.
|
Stockholder
Rights Plan
|
14.
|
Warrants
|
|
Weighted
|
Weighted
|
|||||||
|
Common Shares
|
Average
|
Average
|
||||||
|
Issuable upon
|
Exercise
|
Contractual
|
||||||
|
Exercise
|
Price
|
Life
|
||||||
Outstanding
at January 1, 2007
|
1,341,668
|
$
|
19.95
|
||||||
Issued
(Note 8)
|
30,000
|
$
|
22.80
|
||||||
Exercised
|
(186,033
|
)
|
$
|
27.45
|
|||||
Cancelled
|
(356,305
|
)
|
$
|
21.00
|
|||||
Outstanding
at December 31, 2007
|
829,330
|
$
|
18.45
|
||||||
Issued
(Note 8)
|
16,667
|
$
|
17.25
|
||||||
Exercised
|
(31,460
|
)
|
$
|
13.35
|
|||||
Cancelled
|
(6,667
|
)
|
$
|
22.80
|
|||||
Outstanding
at December 31, 2008
|
807,870
|
$
|
18.45
|
||||||
Issued
|
|||||||||
Exercised
|
|||||||||
Cancelled
|
(342,595
|
)
|
$
|
23.70
|
|||||
Outstanding
at December 31, 2009
|
465,275
|
$
|
15.45
|
1.03 years
|
|||||
Exercisable
at December 31, 2009
|
465,275
|
$
|
18.45
|
1.22
years
|
15.
|
Income
Taxes
|
|
December 31,
|
|||||||
2009
|
2008
|
|||||||
Deferred tax assets:
|
||||||||
Net
operating tax loss carryforwards
|
$
|
44,000,000
|
$
|
40,500,000
|
||||
Research
and development tax credits
|
2,400,000
|
2,200,000
|
||||||
Deferred
compensation
|
300,000
|
300,000
|
||||||
Bases
of intangible assets
|
(1,660,000
|
)
|
-
|
|||||
Total
deferred tax asset
|
45,040,000
|
43,000,000
|
||||||
Less
valuation allowance
|
(45,040,000
|
)
|
(43,000,000
|
)
|
||||
Net
deferred tax asset
|
$
|
—
|
$
|
—
|
|
For the years ended
|
|||||||||||
|
December 31,
|
|||||||||||
2009
|
2008
|
2007
|
||||||||||
Federal
statutory tax rate
|
(35
|
)%
|
(35
|
)%
|
(35
|
)%
|
||||||
State
taxes, net of federal benefit
|
(6
|
)%
|
(6
|
)%
|
(6
|
)%
|
||||||
Valuation
allowance
|
41
|
%
|
41
|
%
|
41
|
%
|
||||||
Sale
of state net operating losses
|
(8.35
|
)%
|
(15.35
|
)%
|
(8.40
|
)%
|
||||||
Provision
(benefit) for income taxes
|
(8.35
|
)%
|
(15.35
|
)%
|
(8.40
|
)%
|
16.
|
Commitments
and Contingencies
|
Years Ended
December 31,
|
Amount
|
|||
2010
|
405,144
|
|||
2011
|
420,167
|
|||
2012
|
172,236
|
|||
2013
|
177,396
|
|||
2014
|
182,724
|
|||
Thereafter
|
188,208
|
|||
$
|
1,545,875
|
17.
|
Segment
and Geographic Information
|
18.
|
Subsequent
Events
|
Amount
|
||||
Securities
and Exchange Commission registration fee
|
$ | 463.45 | ||
Financial
Industry Regulatory Authority, Inc. fee
|
$ | * | ||
Accountants’
fees and expenses
|
$ | * | ||
Legal
fees and expenses
|
$ | * | ||
Transfer
Agent’s fees and expenses
|
$ | * | ||
Printing
and engraving expenses
|
$ | * | ||
Miscellaneous
|
$ | * | ||
Total
Expenses
|
$ | 463.45 |
NEXMED,
INC.
|
|||
By:
|
/s/
Bassam Damaj
|
||
Name:
|
Bassam
B. Damaj
|
||
Title:
|
President,
Chief Executive Officer and
Director
|
Signature
|
Title
|
Date
|
||
President,
Chief Executive Officer and
|
August
31, 2010
|
|||
/s/ Bassam Damaj
|
Director
(Principal Executive Officer)
|
|||
Bassam
B. Damaj, Ph.D.
|
||||
Chief
Financial Officer (Principal Financial
|
August
31, 2010
|
|||
/s/ Mark Westgate |
Officer
and Principal Accounting Officer)
|
|||
Mark
Westgate
|
||||
August
31, 2010
|
||||
/s/ Roberto Crea
|
Director
|
|||
Roberto
Crea
|
||||
August
31, 2010
|
||||
/s/ Henry J. Esber
|
Executive
Vice President and Director
|
|||
Henry
J. Esber
|
||||
August
31, 2010
|
||||
/s/ Deirdre Y. Gillespie |
Director
|
|||
Deirdre
Y. Gillespie
|
||||
Executive
Vice President, Chairman and
|
August
31, 2010
|
|||
/s/ Vivian Liu
|
Director
|
|||
Vivian
H. Liu
|
||||
August
31, 2010
|
||||
/s/ Leonard A. Oppenheim
|
Director
|
|||
Leonard
A. Oppenheim
|
||||
August
31, 2010
|
||||
/s/ Russell Ray
|
Director
|
|||
Russell
Ray
|
|
|
EXHIBITS
NO.
|
DESCRIPTION
|
|
2.1
|
Agreement
and Plan of Merger by and among the Company, BQ Acquisition Corp.,
Bio-Quant, Inc., and certain other parties listed therein, dated as of
November 20, 2009 (incorporated herein by reference to Exhibit 2.1 to the
Company’s Current Report on Form 8-K filed with the Securities and
Exchange Commission on November 23, 2009).
|
|
3.1
|
Amended
and Restated Articles of Incorporation of the Company (incorporated herein
by reference to Exhibit 2.1 to the Company’s Registration Statement on
Form 10-SB filed with the Securities and Exchange Commission on March 14,
1997).
|
|
3.2
|
Amended
and Restated By-laws of the Company (incorporated herein by reference to
Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed with the
Securities and Exchange Commission on May 14, 2003).
|
|
3.3
|
Certificate
of Amendment to Articles of Incorporation of the Company, dated June 22,
2000 (incorporated herein by reference to Exhibit 3.2 to the Company’s
Annual Report on Form 10-K filed with the Securities and Exchange
Commission on March 31, 2003).
|
|
3.4
|
Certificate
of Amendment to the Company’s Articles of Incorporation, dated June 14,
2005. (incorporated herein by reference to Exhibit 3.4 to the Company’s
Annual Report on Form 10-K filed with the Securities and Exchange
Commission on March 16, 2006).
|
|
3.5
|
Second
Amended and Restated By-Laws of the Company, effective as of April 18,
2008 (incorporated herein by reference to Exhibit 3.1 to the Company’s
Current Report on Form 8-K filed with the Securities and Exchange
Commission on April 24, 2008).
|
|
3.6
|
Certificate
of Amendment to Amended and Restated Articles of Incorporation of the
Company, dated March 3, 2010 (incorporated herein by reference to Exhibit
3.6 to the Company’s Annual Report on Form 10-K filed with the Securities
and Exchange Commission on March 31, 2010).
|
|
3.7
|
Certificate
of Correction to Certificate of Amendment to Amended and Restated Articles
of Incorporation of the Company, dated March 3, 2010 (incorporated herein
by reference to Exhibit 3.7 to the Company’s Annual Report on Form 10-K
filed with the Securities and Exchange Commission on March 31,
2010).
|
|
3.8
|
Certificate
of Change filed with the Nevada Secretary of State (incorporated herein by
reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K with
the Securities Exchange Commission on June 17, 2010).
|
|
4.1
|
Form
of Common Stock Certificate (incorporated herein by reference to Exhibit
3.1 filed with the Company’s Registration Statement on Form 10-SB filed
with the Securities and Exchange Commission on March 14,
1997).
|
|
4.2
|
Form
of Warrant, dated November 30, 2006 (incorporated herein by reference to
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on December 4,
2006).
|
|
4.3
|
Form
of Warrant, dated December 20, 2006 (incorporated herein by reference to
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on December 21,
2006).
|
|
4.4
|
Form
of Warrant, dated October 26, 2007 (incorporated herein by reference to
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on October 31,
2007).
|
|
4.5
|
Form
of Warrant (incorporated herein by reference to Exhibit 4.4 to the
Company’s Registration Statement on Form S-3 filed with the Securities and
Exchange Commission on July 29,
2008).
|
4.6
|
Form
of Warrant (to be filed by amendment).
|
|
5.1
|
Opinion
of Brownstein Hyatt Farber Schreck, LLP (to be filed by
amendment).
|
|
10.1*
|
Amended
and Restated NexMed, Inc. Stock Option and Long-Term Incentive
Compensation Plan (incorporated herein by reference to Exhibit 10.1 filed
with the Company’s Quarterly Report on Form 10-Q filed with the Securities
and Exchange Commission on May 15, 2001).
|
|
10.2*
|
The
NexMed, Inc. Recognition and Retention Stock Incentive Plan (incorporated
herein by reference to Exhibit 99.1 filed with the Company's Current
Report on Form 8-K filed with the Securities and Exchange Commission on
May 28, 2004).
|
|
10.3
|
License
Agreement dated March 22, 1999 between NexMed International Limited and
Vergemont International Limited (incorporated herein by reference to
Exhibit 10.7 of the Company’s Annual Report on Form 10-KSB filed with the
Securities and Exchange Commission on March 16, 2000).
|
|
10.4*
|
Employment
Agreement dated February 26, 2002 by and between the Company and Dr.
Y. Joseph Mo (incorporated herein by reference to Exhibit 10.7 of the
Company’s Form 10-K filed with the Securities and Exchange Commission on
March 29, 2002).
|
|
10.5*
|
Amendment
to Employment Agreement, dated September 26, 2003, by and between Dr. Y.
Joseph Mo and the Company (incorporated herein by reference to Exhibit
10.4 to the Company’s Quarterly Report on Form 10-Q filed with the
Securities and Exchange Commission on November 12,
2003).
|
|
10.6*
|
Stock
Option Grant Agreement between the Company and Leonard A. Oppenheim dated
November 1, 2004 (incorporated herein by reference to Exhibit 10.2 to the
Company’s Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission on November 9, 2004).
|
|
10.7*
|
Form
of Stock Option Grant Agreement between the Company and its Directors
(incorporated herein by reference to Exhibit 10.29 to the Company’s Annual
Report on Form 10-K filed with the Securities and Exchange Commission on
March 16, 2005).
|
|
10.8+
|
License
Agreement, dated September 13, 2005, by and among the Company, NexMed
International Limited and Novartis International Pharmaceutical Ltd.
(incorporated herein by reference to Exhibit 99.1 to the Company’s Current
Report on Form 8-K filed with the Securities and Exchange Commission on
September 15, 2005).
|
|
10.9*
|
Employment
Agreement, dated December 15, 2005, by and between the Company and Mark
Westgate (incorporated herein by reference to Exhibit 10.31 to the
Company’s Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 16, 2006).
|
|
10.10*
|
NexMed,
Inc. 2006 Stock Incentive Plan (incorporated herein by reference to Annex
A of the Company’s Definitive Proxy Statement filed with the Securities
and Exchange Commission on April 6, 2006).
|
|
10.11
|
Securities
Purchase Agreement, dated November 30, 2006, by and among the Company,
NexMed (U.S.A.), Inc. and Metronome LPC 1, Inc. (incorporated herein by
reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
filed with the Securities and Exchange Commission on December 4,
2006).
|
|
10.12
|
Common
Stock and Warrant Purchase Agreement, dated December 20, 2006
(incorporated herein by reference to Exhibit 10.1 to the Company’s Current
Report on Form 8-K filed with the Securities and Exchange Commission on
December 21, 2006).
|
|
10.13
|
Amendment
to License Agreement, effective as of February 13, 2007, by and among
Novartis International Pharmaceutical Ltd., the Company and NexMed
International Limited (incorporated herein by reference to Exhibit 99.1 to
the Company’s Form 8-K filed with the Securities and Exchange Commission
on February 23, 2007).
|
10.14
+
|
License
Agreement, dated November 1, 2007, by and between the Company and Warner
Chilcott Company, Inc. (incorporated herein by reference to Exhibit 10.31
to the Company’s Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 12, 2008).
|
|
10.15
|
Purchase
Agreement, dated October 26, 2007, by and between the Company and Twin
Rivers Associates, LLC (incorporated herein by reference to Exhibit 10.1
to the Company’s Current Report on Form 8-K filed with the Securities and
Exchange Commission on October 31, 2007).
|
|
10.16
|
Senior
Secured Note dated October 26, 2007, between NexMed, Inc. and Twin Rivers
Associates, LLC. (incorporated herein by reference to Exhibit 10.2 to the
Company’s Current Report 8-K filed with the Securities and Exchange
Commission on October 31, 2007).
|
|
10.17
|
Side
Letter, dated June 26, 2008, to License Agreement by and among Novartis
International Pharmaceutical Ltd., the Company and NexMed International
Limited (incorporated herein by reference to Exhibit 10.1 to the Company’s
Current Report on Form 8-K filed with the Securities and Exchange
Commission on July 1, 2008).
|
|
10.18*
|
NexMed,
Inc. Amendment to 2006 Stock Incentive Plan (incorporated by reference to
Appendix A of the Company’s Definitive Proxy Statement filed with the
Securities and Exchange Commission on April 18, 2008).
|
|
10.19
|
Asset
Purchase Agreement, dated February 3, 2009, between Warner Chilcott
Company, Inc. and the Company (incorporated herein by reference to Exhibit
10.1 to the Company’s Current Report on Form 8-K filed with the Securities
and Exchange Commission on February 5, 2009).
|
|
10.20
|
License
Agreement, dated February 3, 2009, between Warner Chilcott Company, Inc.
and the Company (incorporated herein by reference to Exhibit 10.2 to the
Company’s Current Report on Form 8-K filed with the Securities and
Exchange Commission on February 5, 2009).
|
|
10.21*
|
Amended
and Restated Employment Agreement, dated December 14, 2009, by and between
NexMed, Inc. and Vivian H. Liu (incorporated herein by reference to
Exhibit 10.42 to the Company’s Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 31, 2010).
|
|
10.22*
|
Employment
Agreement, dated December 14, 2009, by and between NexMed, Inc. and Bassam
Damaj, Ph.D. (incorporated herein by reference to Exhibit 10.43 to the
Company’s Annual Report on Form 10-K filed with the Securities and
Exchange Commission on March 31, 2010).
|
|
10.23
|
Purchase
Agreement, dated March 15, 2010, by and between NexMed, Inc. and the
Purchasers named therein (incorporated herein by reference to Exhibit
10.44 to the Company’s Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 31, 2010).
|
|
10.24
|
Registration
Rights Agreement, dated March 15, 2010 (incorporated herein by reference
to Exhibit 10.45 to the Company’s Annual Report on Form 10-K filed with
the Securities and Exchange Commission on March 31,
2010).
|
|
10.25
|
Form
of 7% Convertible Note Due December 31, 2012 (incorporated herein by
reference to Exhibit 10.46 to the Company’s Annual Report on Form 10-K
filed with the Securities and Exchange Commission on March 31,
2010).
|
|
10.26
|
NexMed,
Inc. Subscription Agreement and Instructions (incorporated herein by
reference to Exhibit 10.47 to the Company’s Annual Report on Form 10-K
filed with the Securities and Exchange Commission on March 31,
2010).
|
|
10.27
|
Form
of Unsecured Promissory Note (incorporated herein by reference to Exhibit
10.48 to the Company’s Annual Report on Form 10-K filed with the
Securities and Exchange Commission on March 31, 2010).
|
|
10.28
|
Sales
Agreement, dated as of April 21, 2010, by and between the Company and
Brinson Patrick Securities Corporation (incorporated herein by reference
to Exhibit 10.1 to the Company’s Form 8-K filed with the Securities and
Exchange Commission on April 21,
2010).
|
10.29
|
Engagement
Letter by and between the Company and Dawson James Securities, Inc. dated
as of August 16, 2010 (to be filed by amendment).
|
|
10.30
|
Form
of Warrant Agent Agreement (to be filed by amendment).
|
|
21.1
|
Subsidiaries
(incorporated herein by reference to Exhibit 21 to the Company’s Annual
Report on Form 10-K filed with the Securities and Exchange Commission on
March 31, 2010).
|
|
23.1
|
Consent
of Amper, Politziner & Mattia, LLP., independent registered
public accounting firm.
|
|
23.2
|
Consent
of Brownstein Hyatt Farber Schreck, LLP (included in Exhibit 5.1) (to be
filed by amendment).
|
|
24.1
|
Power
of Attorney (included on page
II-6).
|
*
|
Management
compensatory plan or arrangement required to be filed as an exhibit
pursuant to Item 15(c) of Form
10-K.
|
+
|
Portions
of this exhibit have been omitted pursuant to a request for confidential
treatment with the Securities and Exchange Commission. Such portions have
been filed separately with the Securities and Exchange
Commission.
|