As filed with the Securities and Exchange Commission on February 12, 2002
Registration No. 333 - 70220
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 3
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
AMERICAN BIO MEDICA CORPORATION
(Exact name of registrant as specified in its charter)
New York 14-1702188
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
122 Smith Road 12106
Kinderhook, New York (Zip Code)
(Address of principal executive offices)
800-227-1243
Keith E. Palmer
Chief Financial Officer
122 Smith Road
Kinderhook, New York 12106
(800)-227-1243
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Richard L. Burstein, Esq.
Tuczinski, Burstein & Collura, P.C.
90 State Street, Suite 1011
Albany, New York 12207
(518)-463-3990
Approximate date of commencement of proposed sale to the public: At
such time or times after the Registration Statement becomes effective as the
selling shareholder may determine.
If the only securities being registered on this form are to be 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, please check the following box. [X]
If this form is to be 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 delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
PROSPECTUS
AMERICAN BIO MEDICA CORPORATION
4,227,420 SHARES COMMON SHARES
The registration statement covers the resale of up to 4,227,420
shares of common stock by the selling shareholders identified on pages 11 and
12.
The last reported sale price of the common shares, which are listed
on The Nasdaq SmallCap Market under the symbol "ABMC," was $.82 per share on
February 8, 2002. Our headquarters are located at 122 Smith Road, Kinderhook,
New York 12106. Our telephone number is (800) 227-1243.
THE SHARES OFFERED IN THIS PROSPECTUS INVOLVE A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 3 OF THIS PROSPECTUS FOR INFORMATION THAT YOU SHOULD
CONSIDER BEFORE PURCHASING THESE SECURITIES.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is February 12, 2002.
1
TABLE OF CONTENTS
Page
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PROSPECTUS SUMMARY 2
THE COMPANY 2
THE OFFERING 3
RISK FACTORS 3
USE OF PROCEEDS 9
SELLING SHAREHOLDERS 10
PLAN OF DISTRIBUTION 13
LEGAL MATTERS 15
EXPERTS 15
WHERE YOU CAN FIND ADDITIONAL INFORMATION 15
PROSPECTUS SUMMARY
This summary highlights our business and other selected information
contained elsewhere in the prospectus. This summary does not contain all of the
information that you should consider before making an investment decision. You
should read the entire prospectus carefully, including our financial statements
and other information incorporated by reference in this prospectus, before
deciding to invest.
THE COMPANY
We develop, manufacture and market biomedical technologies and products
intended for the immediate, onsite screening for drugs of abuse. Our Rapid Drug
Screen(TM) and Rapid One(TM) are urine-based kits that are easy to use,
cost-effective, highly accurate and reliable tests for the presence of drugs of
abuse in individuals. We own several patents that are used in the Rapid Drug
Screen.
We produce several versions of a drugs of abuse screening test, under
the name Rapid Drug Screen. The Rapid Drug Screen is a one-step test that allows
a small urine sample to be tested simultaneously for the presence or absence of
up to ten drugs of abuse (cocaine, THC (marijuana), opiates, amphetamine, PCP,
benzodiazepines, methamphetamine, barbiturates, tricyclic antidepressants and
methadone).
The competitively priced test is self-contained. This eliminates
exposure of the test administrator to the urine sample. We believe that the
Rapid Drug Screen product is easier to use than other competitive products
because it requires no mixing of reagents, pipetting or manipulation of the
test. Controlled tests conducted by an independent laboratory compared the Rapid
Drug Screen with results produced by EMIT II, a standard laboratory test, and
found greater than 99% correlation of results.
Our tests require marketing clearance from the Food and Drug
Administration, or FDA. Our most recent 510k marketing clearance received from
the FDA was for the nine panel test. As a result of the FDA's approval of all
nine drug tests manufactured by us, we can offer a variety of test combinations
to meet customer requirements. Included in our product offerings are nine single
tests called Rapid One, each of which detects one drug of abuse (cocaine, THC,
opiates, amphetamine, PCP, benzodiazepines, methamphetamines, barbiturates and
tricyclic antidepressants). We also have developed a methadone test that we
intend to submit to the FDA for marketing clearance.
2
In January 2000, we licensed the exclusive rights to distribute and
market a patented residue and/or trace drug detection system in select markets
in North and South America for a period of five years. We utilize the trademark
"Drug Detector" for this product. The Drug Detector(TM) tests surfaces for the
presence or absence of residue from marijuana, cocaine, heroin or
methamphetamines without the need for urine, hair or saliva samples.
In October 2001, we entered into a license agreement with ANSYS
Technologies, Inc. allowing us to market an on-site saliva based test in
criminal justice, workplace and drug treatment sectors (i.e. the forensic
markets). We utilize the trademark "OralStat6" for this product. The
OralStat6(TM) simultaneously tests a saliva sample for the presence or absence
of marijuana, opiates, cocaine, PCP, amphetamine and methamphetamine and
delivers results in 10-15 minutes.
THE OFFERING
This is an offering of: (a) up to 4,227,420 common shares, par value
$0.01 a share, of American Bio Medica Corporation, of which 2,549,000 are common
shares of ABMC and 1,678,420 are common shares issuable upon the exercise of
common share purchase warrants and (b) up to 1,274,500 common share purchase
warrants. All of these securities are being offered by the selling shareholders.
On August 22, 2001, in a private placement exempt from registration under the
Securities Act of 1933, as amended, selling shareholders acquired (a) 2,549,000
common shares for a purchase price of $1.00 per share, and (b) 1,274,500
warrants ("Investor Warrants") to purchase one common share at an exercise price
of $1.05 per share and 203,920 warrants ("Placement Agent Warrants") to purchase
one common share at an exercise price of $1.20 per share, exercisable during a
54 month period beginning on February 22, 2002. The Investor Warrants and
Placement Agent Warrants together shall be referred to as the "Private Placement
Warrants". In addition, selling shareholders acquired 200,000 warrants to
purchase one common share at an exercise price of $1.50 per share pursuant to a
financial advisory agreement filed as an exhibit to our 10-KSB for the fiscal
year ending April 30, 2001 ("Brean Murray Warrants"). We are registering the
selling shareholders' resale of these securities pursuant to Registration Rights
Agreements between the selling shareholders and us. The registration of the
common shares, the Investor Warrants and the common shares issuable upon the
exercise of the Placement Agent Warrants and Brean Murray Warrants does not
necessarily mean that any of them will be offered or sold by the selling
shareholders. The securities may be sold directly by the selling shareholders or
through brokers, dealers or agents in private or market transactions. In
connection with any sales, the selling shareholders and any brokers, dealers or
agents participating in such sales may be deemed to be "underwriters" within the
meaning of the Securities Act. See "Selling Shareholders" and "Plan of
Distribution."
RISK FACTORS
We have a limited operating history, which may make it difficult to accurately
forecast our future revenues and other operating results.
We began selling our products in 1996. As a result, we have only a
limited operating history upon which you may evaluate our business and
prospects. Our limited operating history may make it difficult or impossible for
analysts or investors to accurately forecast regarding our future revenues and
other operating results and the price of our common stock could decline
substantially.
3
We have incurred net losses since we were formed.
Since inception in 1992, we have incurred net losses. As of April 30,
2001, we had an accumulated deficit of $13.5 million. We expect to continue to
make substantial expenditures for sales and marketing, product development and
other purposes. Our ability to achieve and maintain profitability in the future
will primarily depend on our ability to increase sales of our products, reduce
production and other costs and successfully introduce new and enhanced versions
of our existing products into the marketplace. We cannot assure you that we will
be able to increase our revenues at a rate that equals or exceeds expenditures.
Our failure to do so will result in our incurring additional losses.
We depend on distributors for a majority of our sales and the loss of, or
reduction in sales by, our current distributors could significantly harm our
business.
We derive a substantial portion of our revenues, and expect to continue
to derive a substantial portion of our revenues in the near future, from sales
by our distributors. Currently we have approximately 75 distributors. During
fiscal 2001, approximately 74%, or $5.5 million of our sales were made to
distributors. No distributor accounted for more than 10% of our total revenues
in fiscal 2001. Unless and until we diversify and expand our sales force, our
success will depend significantly upon the future sales by our distributors. The
loss of or inability to replace any one or more of these distributors,
significant changes in their product requirements, delays of significant orders
or the occurrence of any sales fluctuations of our products could reduce our
revenues.
We only offer a limited number of products and the failure of any one of them to
achieve widespread market acceptance would significantly harm our results of
operation.
We offer a limited number of products, and we currently derive most of
our revenues from sales of our primary product, the Rapid Drug Screen product
line. To attain break-even results of operations, we must achieve approximately
$2.4 million in quarterly revenues from our Rapid Drug Screen product line. If
the Rapid Drug Screen product line does not achieve and maintain this level of
revenue, our results of operations would be significantly harmed.
In addition, we only began selling our Rapid Drug Screen product line in
1996, and cannot yet predict whether they will gain widespread market
acceptance. Achieving market acceptance for our drug tests will require
substantial marketing efforts and expenditure of significant funds to inform
potential distributors and customers of the distinctive characteristics,
benefits and advantages of our test kits. Our Drug Detector was introduced into
the widespread over-the-counter market in late April 2001 and the OralStat6 into
the forensic markets in October 2001. We have no history upon which to base
market or customer acceptance of these products. Introduction of the Drug
Detector and OralStat6 has required, and may continue to require, substantial
marketing efforts and expenditure of funds.
Due to the variety and complexity of the environments in which our
customers operate, our products may not operate as expected. This could result
in cancelled orders, delays and increased expenses. In addition, the success of
competing products and technologies, pricing pressures or manufacturing
difficulties could further reduce our profitability and the price of our common
stock.
4
If we fail to keep up with technological factors and fail to develop our
products, we may be at a competitive disadvantage.
The onsite drug testing market is highly competitive. Several companies
produce drug tests that compete directly with our Rapid Drug Screen product
line, including Roche Diagnostics, Biosite Diagnostics and Medtox Scientifuc,
Inc. As new technologies become introduced into the onsite testing market, we
may be required to commit considerable additional efforts, time and resources to
enhance our current product line or develop new products. Our success will
depend upon new products meeting targeted product costs and performance, in
addition to timely introduction into the marketplace. We are subject to all of
the risks inherent in product development, which could cause material delays in
manufacturing.
We rely on third parties for raw materials used in our Rapid Drug Screen product
line.
We currently have approximately fifty suppliers who provide us with the
raw materials necessary to manufacture our drug testing strips and Rapid Drug
Screen kit. The loss of one or more of these suppliers, the non-performance of
one or more of their materials or the lack of availability of raw materials
could suspend our manufacturing process related to the Rapid Drug Screen product
line. This interruption of the manufacturing process could impair our ability to
fill customers' orders as they are placed, which would put us at a competitive
disadvantage.
We depend on our Research & Development ("R&D") team for product development
and/or product enhancement.
Product development and/or enhancement are performed by our R&D team.
There can be no assurance that our R&D team can successfully develop and/or
complete the enhancement of our current products and/or the development of new
products. Furthermore, the loss of one or more members of our R&D team could
result in the interruption or termination of new product development and/or
current product enhancement, affecting our ability to provide new or improved
products to the marketplace, which would put us at a competitive disadvantage.
Our products must be cost competitive and perform to the satisfaction of our
customers.
Cost competitiveness and satisfactory product performance are essential
for success in the onsite drug testing market. There can be no assurance that
new products we may develop will meet projected price or performance objectives.
Moreover, there can be no assurance that unanticipated problems will not arise
with respect to technologies incorporated into our test kits or that product
defects, affecting product performance, will not become apparent after
commercial introduction of our additional test kits. In the event that we are
required to remedy defects in any of our products after commercial introduction,
the costs to us could be significant, which could have a material adverse effect
on our revenues or earnings.
We face significant competition in the drug testing market and potential
technological obsolescence.
We face competition from other manufacturers of drug test kits such as
Roche Diagnostics, Medox Scientific, Inc. and Biosite Diagnostics. These
competitors are more well known and have far greater financial resources than
us. The markets for drug test kits and related products are highly competitive.
There can be no assurance that other companies will not attempt to develop or
market products directly competitive with the Rapid Drug Screen product line or
Rapid One. We expect other companies to develop technologies or products, which
will compete with our products.
5
Possible inability to find and attract qualified personnel.
We will need additional skilled, sales and marketing, technical and
production personnel to grow the business. If we fail to retain our present
staff or attract additional qualified personnel our business could suffer.
We depend on key personnel to manage our business effectively.
We are dependent on the expertise and experience of our senior management
such as Gerald Moore, President and Chief Executive Officer, Stan Cipkowski,
Executive Vice President, Douglas Casterlin, Executive Vice President of
Operations, Martin Gould, Vice President of Technology and Keith Palmer, Chief
Financial Officer, for our future success. The loss of Messrs. Moore, Cipkowski,
Casterlin, Gould and/or Palmer could negatively impact our business and results
of operations. We do not maintain key man insurance for any of our management
employees.
Failure to effectively manage our growth and expansion could adversely affect
our business and operating results.
We anticipate expansion of our operations in the coming year. Any failure
to manage our growth effectively will result in less efficient operations, which
could adversely affect our operating and financial results.
To effectively manage our growth, we must, among other things:
o accurately estimate the number of employees we will require and the
areas in which they will be required;
o upgrade and expand our office infrastructure so that it is
appropriate for our level of activity;
o manage expansion into additional geographic areas; and
o improve and refine our operating and financial systems.
We expect to devote considerable resources and management time to
improving our operating and financial systems to manage our growth. Failure to
accomplish any of these objectives would impede our ability to deliver products
and services in a timely fashion, fulfill existing customer orders and attract
and retain new customers, which impediment would have a material adverse effect
on our financial condition and results of operations.
Any adverse changes in our regulatory framework could negatively impact our
business.
Approval from the FDA is not currently required for the sale of our
products in non-clinical markets, but is required in the clinical and
over-the-counter markets. Recently, the FDA informed onsite manufacturers that
it intended to enforce its draft guidance document related to the sale of onsite
tests in the workplace market, initially released in 1999. This enforcement
would require that each onsite device be priced to include, up-front, the cost
of obtaining laboratory confirmation of the results of the test. The FDA also
seeks to require the onsite tests to meet over the counter (OTC) clearance or
have a special industrial use clearance (the FDA has not yet published any
guidance with respect to the applicable standards for granting the special
industrial clearance). Although our Rapid Drug Screen has met the FDA
requirements for professional use, we have not obtained OTC clearance from the
FDA. The workplace market is one of our primary markets and the added cost of
confirmation and additional FDA clearance may raise the price of our products
making it difficult to compete with laboratory based testing, thereby negatively
impacting our revenues. Furthermore, there can be no assurance that if, and
when, we are required to apply for either the OTC clearance or the special
industrial clearance, either clearance will be granted. If either such clearance
is not granted, we would be unable to sell our products in the workplace market
and our revenues would be negatively impacted.
6
Although we are currently unaware of any changes in regulatory standards
related to the clinical and OTC markets, if regulatory standards were to change
in the future, there can be no assurance that the FDA will grant us the
approvals, if and when we apply for them, required to comply with the changes.
We rely on intellectual property rights, and we may not be able to obtain patent
or other protection for our technology, products or services.
We rely on a combination of patent, copyright, trademark and trade secret
laws, confidentiality procedures and contractual provisions to protect our
proprietary technology, products and services. We also believe that factors such
as the technological and creative skills of our personnel, new product
developments, frequent product enhancements and name recognition are essential
to establishing and maintaining our technology leadership position.
We seek to protect our proprietary products under trade secret and
copyright laws, which afford only limited protection. We currently have ten
patents relating to the Rapid Drug Screen product line. We have applied for
additional patents on the Rapid Drug Screen and for certain trademarks in the
United States, South and Central America, European Common Market and Japan.
Certain trademarks have been registered and others are pending.
Despite our efforts to protect our proprietary rights, unauthorized
parties may attempt to copy aspects of our products or to obtain information
that we regard as proprietary. For example, our sales were adversely affected in
fiscal 2000 and fiscal 2001 as a result of sales of products similar to ours. In
April of 1999, we filed suit in a federal court against Phamatech, Inc. of
California, a former supplier of the ours, and numerous other parties to stop
these sales. We incurred significant legal fees of $1.6 million attempting to
enforce our patents. In April 2001, we settled with Phamatech and all other
defendants in this lawsuit. The settlement agreement established a license and
royalty arrangement under which we were paid a licensing fee and will continue
to be paid a percentage of revenues of the product. Under the terms of the
settlement, each party has agreed not to disclose to any third parties the terms
and conditions of this agreement.
We may be required to incur significant costs to protect our intellectual
property rights. In addition, the laws of some foreign countries do not ensure
that our means of protecting our proprietary rights in the United States or
abroad will be adequate. Policing and enforcement against the unauthorized use
of our intellectual property rights could entail significant expenses and could
prove difficult or impossible. Additionally, there is no assurance that the
additional patents will be granted or that additional trademarks will be
registered.
7
Potential issuance and exercise of new warrants and exercise of outstanding
warrants could adversely affect our share price.
In connection with our sale of 1,408,450 common shares for $2,000,000
($1.42 per share) in a private placement to Seaside Partners, L.P. on April 28,
2000, we issued a 5-year warrant to Seaside to purchase 953,283 common shares of
our stock at an exercise price of $1.1689 per share. To settle a penalty owed to
Seaside because of a late effective registration statement, we adjusted the
exercise price of the 953,283 warrant shares from $1.1689 to $0.95 in February
2001. In May 2001, we issued a 5-year warrant to purchase 200,000 common shares
of our stock at an exercise price of $1.50 per share to Brean Murray & Co., Inc.
as compensation for their services as a financial advisor. On August 22, 2001,
we issued warrants, exercisable during a 54 month period beginning February 22,
2001, to purchase 1,274,500 common shares of our stock at an exercise price of
$1.05 per share in connection with the private placement of 2,549,000 shares of
common stock. We also issued, on August 22, 2001, warrants, exercisable during a
54 month period beginning February 22, 2001, to purchase a total of 203,920
common shares of our stock at an exercise price of $1.20 per share, of which
warrants to purchase 152,940 common shares were issued to Brean Murray & Co.,
Inc. as compensation for their services as placement agent and warrants to
purchase 12,745 common shares were issued to Axiom Capital Management, Inc.,
warrants to purchase 5,735 common shares were issued to Jeffrey Goldberg,
warrants to purchase 16,250 common shares were issued to Barry Zelin, warrants
to purchase 16,250 common shares were issued to David L. Jordon; for their
services as sub-agents of Brean Murray & Co., Inc.
If the Seaside warrant, the Brean Murray Warrants and the Private
Placement Warrants are exercised, the common shares issued will be freely
tradable, increasing the total number of common shares issued and outstanding.
If these shares are offered for sale in the public market, the sales could
adversely affect the prevailing market price by lowering the bid price of our
common shares. The exercise of any of these warrants could also materially
impair our ability to raise capital through the future sale of equity securities
because issuance of the common shares underlying the warrants would cause
further dilution of our securities. The warrants are subject to or contain
certain anti-dilution protection that may result in the issuance of additional
shares under some circumstances including, but not limited to, paying of a
dividend, subdivision of our outstanding shares into a greater number of shares,
combination of our outstanding shares into a smaller number of shares, an
issuance of shares of common stock by reclassification or in the case of the
Brean Murray and Seaside warrants, a sale of our common shares, or a security
convertible into common shares, for consideration per share less than the
exercise price of the warrants.
Substantial resale of restricted securities may depress the market price of our
stock.
There are 7,329,955 common shares presently issued and outstanding as of
the date hereof that are "restricted securities" as that term is defined under
the Securities Act of 1933, as amended, (the "Securities Act") and in the future
may be sold in compliance with Rule 144 of the Securities Act, or pursuant to a
Registration Statement filed under the Securities Act. Rule 144 provides that a
person holding restricted securities for a period of one year or more may, in
any three month period, sell those securities in unsolicited brokerage
transactions or in transactions with a market maker, in an amount equal to the
greater of one percent of the our outstanding common shares or the average
weekly trading volume for the prior four weeks. Sales of unrestricted shares by
affiliates of the Company are also subject to the same limitation upon the
number of shares that may be sold in any three-month period. Investors should be
aware that sales under Rule 144 or 144(k), or pursuant to a registration
statement filed under the Act, may depress the market price of our Company's
securities in any market that may develop for such shares.
We may need additional funding for our existing and future operations.
We expect that with the proceeds from our August 2001 private placement
offering, our working capital will be sufficient to fund operations for at least
12 months. This estimate is based on certain assumptions and there can be no
assurance that unanticipated costs will not be incurred. Future events,
including the problems, delays, expenses and difficulties which may be
encountered in establishing and maintaining a substantial market for the Rapid
Drug Screen product line and Rapid One could make cash on hand insufficient to
fund operations. There can be no assurance that we will be able to obtain any
necessary financing on terms acceptable to us, if at all. Any financing may
result in further dilution to our existing shareholders.
8
In addition, we will need to secure mortgage financing by the end of
September 2001 to purchase our facility in Kinderhook, New York. We cannot be
sure we will be able to secure this mortgage financing. If we are unable to do
so, we may be required to vacate this facility. This could have a material
adverse affect on our business and results of operations.
Our ability to retain and attract market makers is important to the continued
trading of our stock.
The common shares trade on the Nasdaq SmallCap Market under the symbol
"ABMC". In the event that the market makers cease to function as such, public
trading in common shares will be adversely affected or may cease entirely.
If we fail to meet the continued listing requirements of the Nasdaq SmallCap
Market, our common shares could be delisted.
Our common shares are listed on the Nasdaq SmallCap Market. The
Nasdaq Stock Market's Marketplace Rules impose requirements for companies listed
on the Nasdaq SmallCap Market to maintain their listing status, including
minimum bid price of $1.00 and $2,500,000 in shareholders' equity. As of the
date of this prospectus, our common shares are trading at levels lower than the
minimum bid requirement.
In response to the extraordinary market conditions following the
tragedy of September 11, 2001, The Nasdaq Stock Market implemented an
across-the-board moratorium on the minimum bid and public float requirements for
continued listing on Nasdaq. The proposal suspended these requirements until
January 2, 2002. With this suspension, we are not in the delisting process.
However, if our common shares continue to trade below the listing requirement
for thirty consecutive trading days after January 2002, we may be subject to
delisting.
Delisting could reduce the ability of investors to purchase or sell
shares as quickly and as inexpensively as they have done historically and could
subject transactions in our shares to the penny stock rules. Furthermore,
failure to obtain listing on another market or exchange may make it more
difficult for traders to sell our securities. Broker-dealers may be less willing
or able to sell or make a market in our common shares because of the penny stock
disclosure rules. Not maintaining a listing on a major stock market may result
in a decrease in the trading price of our common shares due to a decrease in
liquidity and less interest by institutions and individuals in investing in our
common shares. Delisting from the Nasdaq Stock Market would also make it more
difficult for us to raise capital in the future.
Management has broad discretion in the way we use the net proceeds from the
August 2001 private placement.
Our business plan is subject to change based upon changing conditions and
opportunities. The net proceeds from the sale of the securities in the August
2001 private placement have not been allocated for a particular purpose, and our
management will have broad discretion over the use of proceeds that we raise in
the offering. We intend to use the net proceeds for working capital, settlement
of legal fees at a discount and we may also use the net proceeds to make
investments in and acquisitions of complementary businesses, products or
technologies. You must rely on the judgment of management in the acquisition of
the proceeds, and you will not have the opportunity, as part of your investment
decisions, to assess whether these proceeds are being used appropriately.
9
CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING STATEMENTS
Some of the statements in this Prospectus are forward-looking statements.
In addition, we may make forward-looking statements in future filings with the
Securities and Exchange Commission and in written materials, press releases and
oral statements issued by us or on our behalf. Forward-looking statements
include statements regarding the intent, belief or current expectations of us or
our officers, including statements preceded by, followed by or including
forward-looking terminology such as "may," "will," "should," "believe,"
"expect," "anticipate," "estimate," "continue," "predict" or similar
expressions, with respect to various matters.
It is important to note that our actual results could differ materially
from those anticipated from the forward-looking statements depending on various
important factors. These important factors include our history of losses and
ability to continue as a going concern, the uncertainty of acceptance of current
and new products in our markets, competition in our markets, our dependence on
our distributors and the other factors discussed in "Risk Factors".
All forward-looking statements in this Prospectus are based on
information available to us on the date of this Prospectus. We do not undertake
to update any forward-looking statements that may be made by us or on our behalf
in this Prospectus or otherwise. In addition, please note that matters set forth
under the caption "Risk Factors" constitute cautionary statements identifying
important factors with respect to the forward-looking statements, including
certain risks and uncertainties that could cause actual results to differ
materially from those in such forward-looking statements.
An investment in our common shares or common share purchase warrants involves a
high degree of risk. You should carefully consider the specific factors listed
above, together with the cautionary statement under the caption "Cautionary
Statement Regarding Forward Looking Statements" and the other information
included in this Prospectus, before purchasing our common shares. The risks
described above are not the only ones that we face. Additional risks that are
not yet known to us or those we currently think are immaterial could also impair
our business, operating results or financial condition. If any of the following
risks actually occur, our business, financial condition or results of operations
could be adversely affected. In such case, the trading price of our common
shares could decline, and you may lose all or part of your investment.
USE OF PROCEEDS
We will not receive any proceeds from the common shares being sold in
this offering. The common shares will be offered and sold by the selling
shareholders for their own accounts. If all of the Investor Warrants are
exercised, the gross proceeds to us will be approximately $1,338,225. If the all
of the Placement Agent Warrants and the Brean Murray Warrants are exercised, the
gross proceeds to us will be $544,704. The Placement Agent Warrants and the
Brean Murray Warrants may be exercised using a "cashless exercise" feature
provided in the selling shareholders' warrant agreements, in which case we would
receive no cash proceeds from the exercise of those warrants. We intend to use
any such proceeds for working capital and general corporate purposes.
10
SELLING SHAREHOLDERS
The following table sets forth the names of the selling shareholders, the
number of common shares beneficially owned by them as of February 12, 2002
(including common shares underlying the Private Placement Warrants), the number
of warrants to purchase common shares owned by them as of February 12, 2002, the
number of common shares, Investor Warrants and common shares underlying the
warrants being offered by each of them pursuant to this Prospectus, and the
number and percentage of common shares owned by them after the offering,
assuming all shares and warrants offered by them are sold and are sold to third
parties:
---------------------------------------------------------------------------------------------------------------------------------
NUMBER OF NUMBER OF NUMBER OF
COMMON SHARES PURCHASE COMMON SHARES NUMBER NUMBER OF
BENEFICIALLY WARRANTS ISSUABLE UPON OF NUMBER OF COMMON SHARES PERCENTAGE
OWNED BENEFICIALLY EXERCISE OF COMMON PURCHASE BENEFICIALLY BENEFICIALLY
NAME OF SELLING BEFORE THE OWNED BEFORE PURCHASE SHARES WARRANTS OWNED AFTER OWNED AFTER THE
SHAREHOLDER OFFERING THE OFFERING WARRANTS OFFERED(1) OFFERED THE OFFERING OFFERING(2)
---------------------------------------------------------------------------------------------------------------------------------
A. Brean Murray(9) 150,000 75,000 75,000 300,000 75,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Robert S. Anderson
BSSC Master Def.
Contribution P/S/P(6) 119,300 50,000 50,000 150,000 50,000 19,300 *
---------------------------------------------------------------------------------------------------------------------------------
Dan Suker W.G. Limited 100,000 50,000 50,000 150,000 50,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Norman C. Fields(11) 41,400 15,000 15,000 45,000 15,000 11,400 *
---------------------------------------------------------------------------------------------------------------------------------
David J. Rochester 10,000 5,000 5,000 15,000 5,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Graham Rex & Sally
Ann Beachley 25,000 12,500 12,500 37,500 12,500 0 *
---------------------------------------------------------------------------------------------------------------------------------
Brean Murray & Co.,
Inc. Profit Sharing
Plan 178,700 75,000 75,000 225,000 75,000 28,700 *
---------------------------------------------------------------------------------------------------------------------------------
Barry K. Fingerhut 300,000 150,000 150,000 450,000 150,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
John P. Lyden MD PC
Def. Contribution DTD
3/1/78 50,000 25,000 25,000 75,000 25,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
E. Thomas Steadman
IRA R/O BSSC 20,000 10,000 10,000 30,000 10,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
E. Thomas Steadman
IRA R/O BSSC Cust.
A/C #2 20,000 10,000 10,000 30,000 10,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
E. Thomas Steadman
IRA R/O A/C#3 BSSC 20,000 10,000 10,000 30,000 10,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
E. Thomas Steadman
IRA R/O BSSC Cust.
A/C #4 20,000 10,000 10,000 30,000 10,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
E. Thomas Steadman
IRA R/O A/C#5 BSSC 20,000 10,000 10,000 30,000 10,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Renee Sands(12) 25,000 12,500 12,500 37,500 12,500 0 *
---------------------------------------------------------------------------------------------------------------------------------
Pequod Investments,
L.P. 340,000 170,000 170,000 510,000 170,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Pequod International,
LTD. 160,000 80,000 80,000 240,000 80,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Kingsbridge Capital
LTD 150,000 75,000 75,000 225,000 75,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
M.K. Global
Technology Partners,
L.P. 25,000 12,500 12,500 37,500 12,500 0 *
---------------------------------------------------------------------------------------------------------------------------------
Aspira Capital
Management, L.P. 75,000 37,500 37,500 112,500 37,500 0 *
---------------------------------------------------------------------------------------------------------------------------------
Benny Lorenzo 200,000 100,000 100,000 300,000 100,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
John F. Murray [7] 74,000 37,000 37,000 111,000 37,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Keith E. Palmer [8] 25,000 12,500 12,500 37,500 12,500 0 *
---------------------------------------------------------------------------------------------------------------------------------
Selig Zises 150,000 75,000 75,000 225,000 75,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
Eleanor M. Evans(10) 10,000 5,000 5,000 15,000 5,000 0 *
---------------------------------------------------------------------------------------------------------------------------------
12
NUMBER OF NUMBER OF NUMBER OF
COMMON SHARES PURCHASE COMMON SHARES NUMBER NUMBER OF
BENEFICIALLY WARRANTS ISSUABLE UPON OF NUMBER OF COMMON SHARES PERCENTAGE
OWNED BENEFICIALLY EXERCISE OF COMMON PURCHASE BENEFICIALLY BENEFICIALLY
NAME OF SELLING BEFORE THE OWNED BEFORE PURCHASE SHARES WARRANTS OWNED AFTER OWNED AFTER THE
SHAREHOLDER OFFERING THE OFFERING WARRANTS OFFERED(1) OFFERED THE OFFERING OFFERING(2)
----------------------------------------------------------------------------------------------------------------------------
Brean Murray & Co.,
Inc (5) 0 352,940(3) 352,940(3) 352,940 0 0 *
----------------------------------------------------------------------------------------------------------------------------
David L. Jordon(5) 350,000(14) 166,250(15) 166,250(15) 466,250(13) 0 50,000 *
----------------------------------------------------------------------------------------------------------------------------
Barry Zelin(5) 0 16,250(4) 16,250 16,250 0 0 *
----------------------------------------------------------------------------------------------------------------------------
Axiom Capital 0 12,745(4) 12,745 12,745 0 0
Management(5) *
----------------------------------------------------------------------------------------------------------------------------
Jeffrey Goldberg(5) 0 5,735(4) 5,735 5,735 0 0 *
----------------------------------------------------------------------------------------------------------------------------
(1) Represents all of the common shares and common shares issuable upon
exercise of warrants to purchase common shares.
(2) Based on 20,609,548 common shares outstanding as of October 31, 2001.
Assuming all shares offered by this Prospectus are sold and are sold to
third parties.
(3) Warrants to purchase 152,940 common shares issued in consideration of
Brean Murray & Co., Inc.'s services as exclusive placement agent in the
August 2001 private placement and warrants to purchase 200,000 common
shares in consideration of Brean Murray & Co., Inc.'s services as a
financial advisor.
[4] Issued in consideration of services as sub-agents for Brean Murray & Co.,
Inc. in the August 2001 private placement.
[5] In May 2001, we engaged Brean Murray & Co., Inc. to provide financial
advisory services to us for a term of one year unless earlier terminated
by the parties. Under this agreement, we agreed to issue to Brean Murray &
Co., Inc. a 5 year warrant to purchase 200,000 common shares at an
exercise price of $1.50 per share plus reasonable out-of-pocket expenses
for its services under this agreement.
Pursuant to an engagement letter between us and Brean Murray & Co., Inc.,
dated June 4, 2001, we engaged Brean Murray & Co., Inc. Pursuant to this
letter, Brean Murray & Co., Inc. received for its services (1) $178,430 as
a placement agent fee, and (2) warrants to purchase 152,940 common shares
at an exercise price of $1.20 per share, David L. Jordon received warrants
to purchase 16,250 common shares at an exercise price of $1.20 per share,
Barry Zelin received warrants to purchase 16,250 common shares at an
exercise price of $1.20 per share, Axiom Capital Management received
warrants to purchase 12,745 common shares at an exercise price of $1.20
per share and Jeffrey Goldberg received warrants to purchase 5,735 common
shares at an exercise price of $1.20 per shares, exercisable during the 54
month period beginning on February 22, 2002 for their services as
sub-agents to Brean Murray & Co., Inc. The Brean Murray & Co., Inc. Profit
Sharing Plan purchased common shares in our August 2001 private placement
of our common shares.
[6] Robert S. Anderson is a Senior Vice President of Brean Murray & Co., Inc.
Brean Murray & Co., Inc was the exclusive placement agent in the August
2001 private placement.
[7] John F. Murray was our Chief Financial Officer and Treasurer from November
1997 until October 2000 and was one of our directors from June 1995 until
April 2000. Mr. Murray is also the beneficial owner of options to purchase
a total of 255,000 common shares of the Company as follows: 10,000 options
at an exercise price of $3.00 expiring August 29, 2002, 20,000 options at
an exercise price of $3.00 expiring February 17, 2003, 100,000 options at
an exercise price of $3.00 expiring August 18, 2003 and 125,000 options at
an exercise price of $2.50 expiring November 22, 2009.
13
[8] Keith E. Palmer has been our Chief Financial Officer, Executive Vice
President of Finance and Treasurer since October 2000. Mr. Palmer is also
the beneficial owner of options to purchase a total of 100,000 common
shares of the Company as follows: 41,500 options at an exercise price of
$0.94 expiring April 25, 2006, 30,500 options at an exercise price of
$0.94 expiring April 30, 2006, and 28,000 options at an exercise price of
$0.94 expiring January 10, 2011.
[9] A. Brean Murray is the President and Chief Executive Officer of Brean
Murray & Co., Inc., an investment banking company that is a wholly-owned
subsidiary of BMI Holding Co. A. Brean Murray owns 65.19% of the
outstanding voting stock of BMI Holding Co., and his wife owns 17.78% of
the outstanding voting stock of BMI Holding Co. Brean Murray & Co., Inc.
has provided financial advisory services to us since May 2001.
[10] Eleanor Evans is a relative of David Evans, Esq., who provides legal
services to us related to human resource issues.
[11] Norman Fields is a managing director of Brean Murray & Co., Inc. Brean
Murray & Co., Inc. was the exclusive placement agent in our August 2001
private placement of our common shares.
[12] Renee Sands is a relative of A. Brean Murray, the President and Chief
Executive Officer of Brean Murray & Co., Inc., the exclusive placement
agent in our August 2001 private placement of our common shares.
[13] Includes 16,250 common shares issuable upon exercise of Placement Agent
Warrants and 150,000 common shares issuable upon exercise of Investor
Warrants and 300,000 common shares.
(14) 50,000 common shares registered to Madelyn Jordon, who is David L.
Jordon's spouse.
(15) Includes 16,250 Placement Agent Warrants issued in consideration of
services as sub-agents for Brean Murray & Co., Inc. in the August 2001
private placement.
* Less than 1% of the outstanding common shares
Except for being holders of our common shares and common share purchase
warrants listed in the table above, none of the other selling shareholders has
had any position, office, or other material relationship with us in the past
three years.
PLAN OF DISTRIBUTION
The selling shareholders, or their pledgees, donees, transferees or other
successors in interest, may offer the securities covered by this Prospectus to
the public or otherwise from time to time. We are registering the selling
shareholders' resale of these securities pursuant to Registration Rights
Agreements between the selling shareholders and us. Pursuant to these
agreements, we have agreed to keep the registration statement related to this
Prospectus effective for two years. The registration of these securities does
not necessarily mean that any of them will be offered or sold by the selling
shareholders. The selling shareholders have informed us that any or all of the
securities covered by this Prospectus may be sold to purchasers directly by the
selling shareholders, or their pledgees, donees, transferees or other successors
in interest, or on their behalf through brokers, dealers or agents in private or
market transactions, which may involve crosses or block transactions. In
connection with any sales, the selling shareholders and any brokers, dealers or
agents participating in such sales may be deemed to be "underwriters" within the
meaning of the Securities Act, and any profit on the sale of securities by them
and any discounts, concessions or commissions received by any brokers, dealers
or agents may be deemed to be underwriting discounts and commissions under the
Securities Act.
14
The sales may be made, from time to time, in The Nasdaq Stock Market, on
any stock exchange, in the over-the-counter market, in privately negotiated
transactions or otherwise at prices prevailing in such market, at prices related
to market prices or at negotiated or fixed prices. In effecting sales, the
selling shareholders may engage brokers, dealers and agents, and they may
arrange for other brokers, dealers or agents to participate. Brokers, dealers
and agents will receive usual and customary commissions, concessions or
discounts from the selling shareholders in amounts to be negotiated, and, if the
broker, dealer or agent acts as agent for the purchaser of the common shares,
from the purchaser.
Brokers, dealers or agents may agree with the selling shareholders to
sell a specified number of securities at a stipulated price per share, and, to
the extent such broker, dealer or agent is unable to do so acting as agent for a
selling shareholder, to purchase as principal any unsold securities at the price
required to fulfill the broker's, dealer's or agent's commitment to the selling
shareholder. Brokers, dealers or agents who acquire the securities as principal
may resell those securities from time to time in transactions, which may involve
crosses and block transactions and which may involve sales to and through other
brokers, dealers or agents, including transactions of the nature described above
in The Nasdaq Stock Market, on any stock exchange, in the over-the-counter
market, in negotiated transactions or otherwise, at market prices prevailing at
the time of sale, at prices related to market prices or at negotiated or fixed
prices., and in connection with these resales may pay to or receive from the
purchasers of securities commissions, concessions or discounts as described
above.
We are bearing all of the costs relating to the registration of the
securities. Any commissions, concessions, discounts, or other fees payable to a
broker, dealer, agent or market maker in connection with any sale of securities
will be borne by the selling shareholder. We estimate that our total expenses of
this offering, other than such commissions, concessions, discounts or other
fees, will be approximately $55,000. We will not receive any of the proceeds
from the sale of the securities by the selling shareholders. We will receive
gross proceeds of up to $1,338,225 if all of the Investor Warrants are
exercised. If the all of the Placement Agent Warrants and the Brean Murray
Warrants are exercised, the gross proceeds to us will be $544,704. The Placement
Agent Warrants and the Brean Murray Warrants may be exercised using a "cashless
exercise" feature provided in the Placement Agent warrant agreements, in which
case we would receive no cash proceeds from the exercise of those warrants. We
have agreed to indemnify the selling shareholders or contribute to losses
arising out of certain liabilities that may be incurred in connection with this
offering, including liabilities under the Securities Act. The selling
shareholders have agreed to a similar indemnification of us.
We have informed the selling shareholders that the anti-manipulation
provisions of Regulation M under the Exchange Act may apply to purchases and
sales of securities by the selling shareholders, and that there are restrictions
on market-making activities by persons engaged in the distribution of the
securities. We have also advised the selling shareholders that if a particular
offer of securities is to be made on terms constituting a material change from
the information described in this "Plan of Distribution" section of the
Prospectus, then, to the extent required, a Prospectus Supplement must be
distributed setting forth such terms and related information as required.
15
LEGAL MATTERS
The validity of the common shares and Investor Warrants offered by this
prospectus has been passed upon for us by Tuczinski, Burstein & Collura, P.C.,
90 State Street, Albany, New York 12207.
EXPERTS
The financial statements incorporated in this Prospectus by reference
from the Company's Annual Report on Form 10-KSB, as amended, for the year ended
April 30, 2001, have been audited by Richard A. Eisner & Company, LLP,
independent auditors, as stated in their report (which report includes an
explanatory paragraph that states the Company has experienced recurring net
losses and negative cash flows from operations that raise substantial doubt
about the Company's ability to continue as a going concern) which is
incorporated in this Prospectus by reference, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You can receive copies of such reports, proxy and
information statements, and other information, at prescribed rates, from the SEC
by addressing written requests to the SEC's Public Reference Room at 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549. In addition, you may read
and copy any materials we file with the SEC at the SEC's Public Reference Room
at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional offices
of the SEC, in Washington, D.C., New York, New York and Chicago, Illinois,
Please call the SEC at 1-800-SEC-0330 for further information on the operation
of the public reference rooms. The SEC also maintains an Internet site that
contains reports, proxy and information statements and other information
regarding issuers, such as us, that file electronically with the SEC. The
address of the SEC's Web site is http://www.sec.gov.
We have filed with the SEC a Registration Statement on Form S-3 to
register the common shares that we are offering in this Prospectus. This
Prospectus is part of the Registration Statement. This Prospectus does not
include all of the information contained in the Registration Statement. For
further information about the common shares and us offered in this Prospectus,
you should review the Registration Statement. You can inspect or copy the
Registration Statement, at prescribed rates, at the SEC's public reference
facilities at the address listed above.
Statements contained in this Prospectus concerning the
provisions of documents are necessarily summaries of such documents and when any
such document is an exhibit to the Registration Statement, each such statement
is qualified in its entirety by reference to the copy of such document filed
with the SEC.
This Prospectus incorporates documents by reference that are not
presented in or delivered with it. The following documents, which we have filed
with the SEC, are incorporated by reference into this Prospectus:
- Our Annual Report on Form 10-KSB for the fiscal year ended April 30,
2001
- Our Quarterly Report on Form 10-QSB for the fiscal quarter ended July
31, 2001.
- Our Proxy Statement for our Fiscal 2002 Annual Meeting of Shareholders.
- Our Form 8-K filed on October 5, 2001.
- Our Amendment No. 1 to our Form 10-KSB for the fiscal year ended April
30, 2001, filed December 21, 2001.
16
- Our Amendment No.1 to our Form S-3 filed December 21, 2001.
- Our Amendment No.2 to our Form S-3 filed January 29, 2002
- Our Amendment No. 2 to our Form 10-KSB for the fiscal year ended April
30, 2001, filed January 29, 2002.
- Our Amendment to our Form 10-QSB for the fiscal quarter ended July 31,
2001, filed December 21, 2001.
- Our Form 8-K filed on October 9, 2001.
- Our Form 8-K filed on October 12, 2001.
- Our Form 8-K filed on December 12, 2001.
- Our Form 8-K filed on February 7, 2002.
- Our Form 10-QSB for the fiscal quarter ended October 31, 2001, filed on
December 17, 2001.
- The description of our common shares in our prospectus included in our
registration statement filed with the Securities and Exchange
Commission on November 21, 1996, on Form 10-SB under the caption
"Description of Securities" on page 18 of the prospectus and
incorporated by reference into any reports filed for the purpose of
updating such description.
In addition, all documents filed by us under Section 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 after the date of this
Prospectus but before termination of this offering are deemed to be incorporated
by reference into this Prospectus and will constitute a part of this Prospectus
form the date of filing of those documents.
The documents incorporated by reference into this Prospectus are
available from us upon request. We will provide to each person, including any
beneficial owner, to whom this Prospectus is delivered, at no cost to the
requester, upon your written or oral request, a copy of all of the information
that is incorporated in this Prospectus by reference, except for exhibits unless
the exhibits are specifically incorporated by reference into this prospectus.
Please submit your requests for any of such documents to: American Bio Medica
Corporation, 122 Smith Road, Kinderhook, New York 12106, Attn: Melissa A.
Decker, Assistant Secretary, (800) 227-1243.
17
AMERICAN BIO MEDICA CORPORATION
Part II
Information Not Required in Prospectus
Item 14. Other Expenses Of Issuance And Distribution
The expenses payable by us in connection with the issuance and
distribution of the securities are estimated as follows:
AMOUNT
SEC Registration Fee $ 1,400
Legal Fees and Expenses $ 60,000
Accounting $ 25,000
Transfer Agent Fees $ 1,000
Miscellaneous $ 2,700
Total: $ 90,100
=========
Item 15. Indemnification of Directors and Officers
Under the New York Business Corporation Law ("NYBCL"), a corporation
may indemnify any person made, or threatened to be made, a party to any action
or proceeding, except for shareholder derivative suits, by reason of the fact
that he or she was a director or officer of the corporation, provided such
director or officer acted in good faith for a purpose which he or she reasonably
believed to be in the best interests of the corporation and, in criminal
proceedings, in addition, had no reasonable cause to believe his or her conduct
was unlawful. In the case of shareholder derivative suits, the corporation may
indemnify any person by reason of the fact that he or she was a director or
officer of the corporation if he or she acted in good faith for a purpose which
he or she reasonably believed to be in the best interests of the corporation,
except that no indemnification may be made in respect of (i) a threatened
action, or a pending action which is settled or otherwise disposed of; or (ii)
any claim, issue or matter as to which such person has been adjudged to be
liable to the corporation, unless and only to the extent that the court on which
the action was brought, or, if no action was brought, any court of competent
jurisdiction, determines upon application that, in view of all the circumstances
of the case, the person is fairly and reasonably entitled to indemnity for that
portion of the settlement amount and expenses as the court deems proper.
The indemnification described above under the NYBCL is not exclusive of
other indemnification rights to which a director or officer may be entitled,
whether contained in the certificate of incorporation or by-laws, or when
authorized by (i) such certificate of incorporation or by-laws; (ii) a
resolution of shareholders; (iii) a resolution of directors; or (iv) an
agreement providing for such indemnification, provided that no indemnification
may be made to or on behalf of any director or officer if a judgment or other
final adjudication adverse to the director or officer establishes that his or
her acts were committed in bad faith or were the result of active and deliberate
dishonesty and were material to the cause of action so adjudicated, or that he
or she personally gained in fact a financial profit or other advantage to which
he or she was not legally entitled.
18
Item 16. Exhibits
See Exhibit List on page E-1.
Item 17. Undertakings
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions, or otherwise, ABMC 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 ABMC of expenses incurred or paid by a
director, officer or controlling person of ABMC 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, we will, unless in
the opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue. The Company will:
(a) file, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to include any
additional or changed material information on the plan of distribution.
(b) for determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the
securities offered, and the offering of the securities at that time to
be the initial bona fide offering.
(c) file a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
19
SIGNATURES
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 amended
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the Town of Kinderhook and State of New York on February 12,
2002.
AMERICAN BIO MEDICA CORPORATION
(Registrant)
By: /s/ Keith E. Palmer
---------------------------------------
Keith E. Palmer
Chief Financial Officer, Executive Vice
President & Treasurer
POWER OF ATTORNEY
Each of the undersigned officers and directors of American Bio Medica
Corporation whose signature appears below hereby appoints Stan Cipkowski and
Keith E. Palmer, and each of them, as true and lawful attorney-in-fact for the
undersigned with full power of substitution, to execute in his name and on his
behalf in each capacity stated below, any and all amendments (including
post-effective amendments) to this registration statement as the
attorney-in-fact shall deem appropriate, and to cause to be filed any such
amendment (including exhibits thereto and other documents in connection
therewith) to this registration statement with the Securities and Exchange
Commission, as fully and to all intents and purposes as such person might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact, or any of them, may lawfully do or cause to be done by virtue
herewith.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on February 12, 2002:
Signature Title
--------- -----
/s/ Gerald Moore President, Chief Executive Officer and
---------------------------- Chairman of the Board of Directors
Gerald Moore (Principal Executive Officer)
/s/ Stan Cipkowski Founder, Executive Vice President and
---------------------------- Director
Stan Cipkowski
/s/ Keith E. Palmer Chief Financial Officer, Executive Vice
---------------------------- President and Treasurer
Keith E. Palmer (Principal Financial Officer)
/s/ Edmund Jaskiewicz Corporate Secretary and Director
----------------------------
Edmund Jaskiewicz
/s/ Denis M. O'Donnell. M.D. Director
----------------------------
Denis M. O'Donnell, M.D.
/s/ Robert L. Aromando, Jr. Director
----------------------------
Robert L. Aromando, Jr.
S-1
American Bio Medica Corporation
Index to Exhibits
Number Description of Exhibits
------ -----------------------
3.5 Bylaws of American Bio Medica Corporation, filed as the exhibit
number listed to the Company's 10-KSB filed on November 21, 1996 and
incorporated herein by reference
3.6 Fifth Amendment to the Certificate of Incorporated, filed as the
exhibit number listed to the Company's Form SB-2 filed on May 20,
1998 and incorporated herein by reference
4.6 Fiscal 1997 Nonstatutory Stock Option Plan, filed as part of the
Company's Proxy Statement for its Fiscal 1997 Annual Meeting of
Shareholders and incorporated herein by reference
4.14 Fiscal 1998 Nonstatutory Stock Option Plan, filed as part of the
Company's Proxy Statement for its Fiscal 1998 Annual Meeting of
Shareholders and incorporated herein by reference
4.15 Fiscal 2000 Nonstatutory Stock Option Plan, filed as part of the
Company's Proxy Statement for its Fiscal 2000 Annual Meeting of
Shareholders and incorporated herein by reference
4.17 Fiscal 2001 Nonstatutory Stock Option Plan, filed as part of the
Company's Proxy Statement for its Fiscal 2002 Annual Meeting of
Shareholders and incorporated herein by reference
4.2* Investor Registration Rights Agreement, dated August 22, 2001, among
American Bio Medica Corporation and the investors
4.3* Placement Agent Registration Rights Agreement, dated August 22, 2001,
among American Bio Medica Corporation and the placement agent and its
sub-agents
4.4* Form of Warrant Agreement and Warrant among American Bio Medica
Corporation and the investors
4.5* Form of Warrant Agreement and Warrant among American Bio Medica
Corporation and the placement agent and its sub-agents
5.1* Opinion and Consent of Tuczinski, Burstein & Collura, P.C.
10.11 Financial Advisory Agreement dated May 2, 2001 by and between Brean
Murray & Co., Inc. and the Company, filed as an exhibit to the
Company's Form 10-KSB filed on August 13, 2001 and incorporated
herein by reference
23.1* Consent of Richard A. Eisner & Company, LLP
23.2* Consent of Tuczinski, Burstein & Collura. P.C. (contained in Exhibit
5.1)
24.1* Powers of Attorney (included on page S-1)
----------------------------------------
* Filed with this registration statement.
E-1