As
filed with the Securities and Exchange Commission on June 11, 2009
Registration
No. 333-159286
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
PRE-EFFECTIVE
AMENDMENT NO. 1
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
AMDL, INC.
(Exact name of registrant as specified in its charter)
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Delaware
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33-0413161
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(State or other jurisdiction
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(I.R.S. Employer
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of incorporation or organization)
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Identification No.)
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2492 Walnut Avenue, Suite 100
Tustin, California 92780-7039
(714) 505-4460
(Address, including zip code, and telephone number, including
area code, of registrants principal executive offices)
Douglas C. MacLellan, President
AMDL, Inc.
2492 Walnut Avenue, Suite 100
Tustin, California 92780-7039
(714) 505-4460
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copy to:
Randolf W. Katz, Esquire
Baker & Hostetler LLP
600 Anton Boulevard, Suite 900
Costa Mesa, California 92626
(714) 966-8807
Richard H. Bruck, Esquire
Richard H. Bruck, A Professional Corporation
160 Newport Center Drive, Suite 130
Newport Beach, California 92660
(949) 219-0808
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant to dividend or
interest reinvestment plans, please check the following box:
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If any of the securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment plans, check the following
box:
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If this Form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement for the same
offering:
o
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:
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If this Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with the Commission
pursuant to rule 462(e) under the Securities Act, check the following box:
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If this Form is a post-effective amendment to a registration statement filed pursuant to
General Instruction I.D. filed to register additional securities or additional classes of
securities pursuant to Rule 413(b) under the Securities Act, check the following box:
o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer, or a smaller reporting company.
See the definitions of large
accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
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CALCULATION OF REGISTRATION FEE
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Proposed
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Proposed
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maximum
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maximum
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Title of each class of securities
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Amount
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offering price
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aggregate
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Amount of
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to be registered
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registered
(1)
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per share
(1)(2)
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offering price
(2)
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registration fee
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Common Stock, $.001
par value per share
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4,259,197
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$1.20
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$5,111,036
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$354.68
(previously paid)
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(1)
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Pursuant to Rule 416(a) under the Securities Act of 1933, the shares being registered
hereunder include such indeterminate number of additional shares of common stock as may be
issuable by the registrant with respect to the shares being registered hereunder as a result
of stock splits, stock dividends or similar transactions.
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(2)
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Estimated solely for the purpose of calculating the amount of the registration fee pursuant
to Rule 457(c) under the Securities Act of 1933 based upon the average of the high and low
sales prices of the registrants common stock on May 11,
2009 (when the Registration Statement was originally filed) as listed on the NYSE Alternext
US LLC (formerly known as AMEX).
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The registrant hereby amends this Registration Statement on such date or dates as may be necessary
to delay its effective date until the registrant shall file a further amendment which specifically
states that this Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may determine.
The information in this prospectus is not complete and may be changed. We may not sell these
securities until the registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities and is not soliciting an offer
to buy these securities in any jurisdiction where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED JUNE 11, 2009
PROSPECTUS
AMDL, INC.
4,259,197 SHARES
OF COMMON STOCK
This prospectus relates to shares of common stock of AMDL, Inc. that may be offered for sale
for the account of the selling stockholders identified in this prospectus. The selling
stockholders may offer and sell from time to time up to 4,259,197 shares of our common stock, which
will be issued to the selling stockholders only if and when they exercise warrants held by them.
The selling stockholders may sell all or any portion of their shares of common stock in one or
more transactions on the NYSE Alternext US LLC (formerly known as AMEX) (NYSE Alternext US), in
private, negotiated transactions or a combination of such methods. Each selling stockholder will
determine the prices at which it sells its shares. Although we will incur expenses in connection
with the registration of the common stock, we will not receive any of the proceeds from the sale of
the shares of common stock by the selling stockholders. However, we will receive gross proceeds of
up to approximately $2,100,000 from the exercise of outstanding warrants, if and when they are
exercised.
On
June 8, 2009, there were 17,383,574 shares of common stock outstanding. Our common stock
is listed on the NYSE Alternext US and traded under the symbol
ADL. On June 8, 2009, the closing
price of our common stock on the NYSE Alternext US was $0.98 per share.
We may amend or supplement this prospectus from time to time by filing amendments or
supplements as required. You should read this entire prospectus and any amendments or supplements
carefully before you make your investment decision.
The shares of common stock offered or sold under this prospectus involve a high degree of
risk. See Risk Factors beginning at page 7
of this prospectus to read about certain factors
you should consider before deciding whether to invest in our common stock.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is
, 2009.
TABLE OF CONTENTS
You should rely only on the information contained in or incorporated by reference into this
prospectus or any applicable prospectus supplement. We have not, and the selling stockholders have
not, authorized any person to give you any supplemental information or to make any representations
for us. You should not rely upon any information about us that is not contained in either this
prospectus or in one of our public reports filed with the Securities and Exchange Commission
(SEC) and incorporated into this prospectus. Information contained in this prospectus or in our
public reports may become stale. You should not assume that the information contained in this
prospectus, any prospectus supplement or the documents incorporated by reference are accurate as of
any date other than their respective dates, regardless of the time of delivery of this prospectus
or of any sale of the shares. Our business, financial condition, results of operations and
prospects may have changed since those dates. The selling stockholders are offering to sell, and
seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are
permitted.
Except where the context requires otherwise, in this prospectus, AMDL, company, we,
us, and our refer to AMDL, Inc., a Delaware corporation, and its subsidiaries.
ABOUT FORWARD-LOOKING STATEMENTS
This prospectus contains and incorporates by reference forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934 which reflect our current view (as of the date such forward-looking statement is made) with
respect to future events, prospects, projections or financial performance. These forward-looking
statements are subject to certain uncertainties and other factors that could cause actual results
to differ materially from those made, implied or projected in such statements. Words or phrases
such as anticipate, believe, continue, ongoing, estimate, expect, intend, may,
plan, potential, predict, project or similar words or phrases, or the negatives of those
words or phrases, may identify forward-looking statements, but the absence of these words does not
necessarily mean that a statement is not forward-looking. Except as required by law, we undertake
no obligation to publicly update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
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We cannot guarantee that any forward-looking statement will be realized, although we believe
we have been prudent in our plans and assumptions. Achievement of future results is subject to
risks, uncertainties and potentially inaccurate assumptions. Many events beyond our control may
determine whether results we anticipate will be achieved. Should known or unknown risks or
uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could
differ materially from past results and those anticipated, estimated or projected. You should bear
this in mind as you consider forward-looking statements.
We undertake no obligation to publicly update or revise forward-looking statements, whether as
a result of new information, future events or otherwise. You are advised, however, to consult any
further disclosures we make on related subjects in our
Form 10-Q
and 8-K reports to the SEC. Also
note that we provide the following cautionary discussion of risks, uncertainties and possibly
inaccurate assumptions relevant to our business. These factors individually or in the aggregate, we
think could cause our actual results to differ materially from expected and historical results. You
should understand that it is not possible to predict or identify all such factors. Our actual
results may differ materially from those currently anticipated and expressed in such
forward-looking statements as a result of a number of factors, including those we discuss under
Risk Factors and elsewhere in this Registration Statement.
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PROSPECTUS SUMMARY
This summary highlights selected information from this prospectus. It does not contain all of
the information that is important to you. To understand this offering fully, you should read
carefully the entire prospectus, including Risk Factors, and the other information incorporated
by reference into this prospectus. The following summary is qualified in its entirety by reference
to the detailed information appearing elsewhere in this registration statement.
Our Company
AMDL, Inc. is a vertically integrated pharmaceutical company with three distinct business
divisions: (i) In-Vitro Diagnostics, (ii) China-based Pharmaceutical Manufacturing and
Distribution, and (iii) Cancer Therapeutics. Collectively, these business units focus on the
development, manufacturing, distribution and sales of high-quality medical diagnostic products,
generic pharmaceuticals, nutritional supplements, and cosmetics in the United States, China, Korea,
Taiwan and other markets throughout the world.
AMDL was founded in 1987 as a bio-tech research and development firm that had one product, its
proprietary cancer diagnostic test: AMDL-ELISA DR-70 (FDP). In 2001, we acquired a proprietary
cancer vaccine combination immunogene therapy technology (CIT). CIT is a US patented technology
(patent issued May 25, 2004). In September 2006, we acquired Jade Pharmaceutical Inc. (JPI) in
order to broaden our business into a multi segmented China-centric pharmaceutical business.
Our In-Vitro Diagnostics division develops, manufactures and distributes our proprietary
DR-70 non-invasive cancer blood test kit. Our DR-70 test kit may be used to
assist in the detection of at least 13 different types of cancer, including: lung, breast, stomach,
liver, colon, rectal, ovarian, esophageal, cervical, trophoblastic, thyroid, malignant lymphoma,
and pancreatic. Because the DR-70 test kit is a non-invasive blood test, there are no
side effects of the administration of the test. As with other cancer diagnostic products, false
positive and false negative test results could pose a small risk to patient health if the physician
is not vigilant in following up on the DR-70 test kit results with other clinically
relevant diagnostic modalities. While the DR-70 test kit is helpful in diagnosing
whether a patient has cancer, the attending physician needs to use other testing methods to
determine and confirm the type and kind of cancer involved. DR-70 test kits are
currently being sold to one diagnostic reference laboratory in the United States. We have limited
sales of DR-70
test kits to our distributors outside the United States. We have
developed our next generation version of the DR-70
test kit, and have subsequently
entered into a collaborative agreement with the Mayo Clinic to conduct a clinical study to
determine whether the new version of the kit can lead to improved accuracy in the detection of
early-stage cancer.
We operate our China-based Pharmaceutical Manufacturing and Distribution division through our
wholly-owned subsidiary, JPI. JPI manufactures and distributes generic and homeopathic
pharmaceutical products and supplements, as well as cosmetic products through two wholly-owned
Chinese subsidiaries, Jiangxi Jiezhong Bio-Chemical Pharmacy Company Limited (JJB) and Yangbian
Yiqiao Bio-Chemical Pharmacy Company Limited (YYB). JPI acquired the businesses currently
conducted by YYB and JJB in 2005 along with certain assets and liabilities of a predecessor to JJB
(JiangXi Shangrao KangDa Biochemical Pharmacy Co. Ltd). We were notified by the Chinese Military
Department of its intent to annex one of JJBs plants that is located near a military installation.
Discussions regarding annexation are proceeding and we expect that JJB will be compensated fairly
for the facility upon annexation. JJB intends to find a new single center site in Jiangxi Province,
China to relocate its operations. In addition, we have ceased
production at YYBs facilities and intend to sell the facilities and manufacturing
operations of YYB; however, as of the date hereof, we have not entered into a definitive agreement
for such a transaction. We anticipate that, after YYB is sold, we will continue production of a
number of YYBs former products after the consolidation of JJBs facilities is complete. We may
have to spend significant time and resources finding, building and equipping the new location and
restarting those operations. In addition, such new facilities will need to
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obtain Good Manufacturing Practices (GMP) certification from the China State Food and Drug
Administration (SFDA) for all manufacturing operations.
In August 2001, we acquired a combination immunogene therapy technology (CIT) that may be
effective in building a cancer patients immune system and could eventually lead to a vaccine to
protect patients known to be at risk because of a family history for certain types of cancer. CIT
is intended to build the bodys immune system and destroy cancer cells. We are actively seeking a
pharmaceutical or biotechnology strategic partner with whom to form a joint venture or otherwise
license our CIT technology. We are also currently engaged in litigation regarding certain
intellectual property and equitable interests in the technology.
Our executive offices are located at 2492 Walnut Avenue, Suite 100, Tustin, California 92780,
telephone number (714) 505-4460. In September 2001, we registered our common stock under the
Securities Exchange Act of 1934. Our common stock is listed on the NYSE Alternext US under the
symbol ADL. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, definitive proxy
statements on Schedule 14A, current reports on Form 8-K, and any amendments to those reports and
schedules are made available free of charge on our website,
http://www.amdlcorporate.com
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or at
http://www.sec.gov
. Information on, or accessible through, our website is not
incorporated into this prospectus unless this prospectus specifically indicates otherwise.
The Offering
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Issuer
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AMDL, Inc.
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Selling Stockholders
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Accredited investors who purchased 10% Convertible Notes in a private placement
in September 2008 (the 10% Convertible Note Offering) and accredited investors
who purchased 12% Senior Notes and warrants in two closings of one private
placement offering in December 2008 and January 2009 (the two closings are
hereinafter referred to collectively as the 12% Senior Note Offering).
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Securities offered
by Selling
Stockholders
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4,259,197 shares of common stock
(1)
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Use of Proceeds
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We will not receive any of the proceeds from the sale of the shares of common
stock sold from time to time under this prospectus by the selling stockholders.
We may receive proceeds in connection with the exercise of warrants for the
underlying shares of our common stock, which may in turn be sold by the selling
stockholders under this prospectus. We intend to use any proceeds from the
exercise of warrants for working capital and other general corporate purposes.
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Warrants
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The warrants from the December 2008 and January 2009 closings of the 12% Senior
Note Offering are exercisable at $1.00 per share and $1.13 per share,
respectively.
All of the warrants described above have a five-year term from the date of grant.
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Trading of Warrants
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The common stock underlying the
warrants sold in 12% Senior Note Offering is being
registered for resale hereunder. Currently, there is no public market for the
warrants, and we do not expect that any such market will develop. The warrants
will not be listed on any securities exchange or included in any automated
quotation system.
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Risk Factors
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An investment in our securities involves a high degree of risk and could result
in a loss of
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your entire investment. Prior to making an investment decision,
you should carefully consider all of the information in this prospectus and, in
particular, you should evaluate the risk factors set forth under the caption
Risk Factors.
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NYSE Alternext US
symbol
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ADL
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(1)
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Includes, among other things, 1,406,000 shares of our common stock issuable upon the exercise of common stock
purchase warrants granted to investors in connection with the 12%
Senior Note Offering and 2,091,667 shares of our common stock issuable upon the conversion of the notes issued to investors in connection the
10% Convertible Note Offering.
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RISK FACTORS
This offering involves a high degree of risk. You should consider carefully the following
risk factors, as well as the other information contained in this prospectus and the documents
incorporated by reference into this prospectus, in evaluating an investment in our common stock.
Limited product development activities; our product development efforts may not result in
commercial products.
We intend to continue to pursue SFDA approval of the DR-70 test kit and licensing of our CIT
technology. Due to limited cash resources, we are limited in the number of additional products we
can develop at this time. Successful cancer detection and treatment product development is highly
uncertain, and very few research and development projects produce a commercial product. Product
candidates like the DR-70 test kit or the CIT technology that appear promising in the early phases
of development, such as in early animal or human clinical trials, may fail to reach the market for
a number of reasons, such as:
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the product candidate did not demonstrate acceptable clinical trial results even though
it demonstrated positive preclinical trial results;
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the product candidate was not effective in treating a specified condition or illness;
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the product candidate had harmful side effects on humans;
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the necessary regulatory bodies, such as the SFDA, did not approve our product
candidate for an intended use;
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the product candidate was not economical for us to manufacture and commercialize; and
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the product candidate is not cost-effective in light of existing therapeutics.
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Of course, there may be other factors that prevent us from marketing a product, including, but
not limited to, our limited cash resources. We cannot guarantee we will be able to produce
commercially successful products. Further, clinical trial results are frequently susceptible to
varying interpretations by scientists, medical personnel, regulatory personnel, statisticians and
others, which may delay, limit or prevent further clinical development or regulatory approvals of a
product candidate. Also, the length of time that it takes for us to complete clinical trials and
obtain regulatory approval in multiple jurisdictions for a product varies by jurisdiction and by
product. We cannot predict the length of time to complete necessary clinical trials and obtain
regulatory approval.
Our
cash position in the U.S. and China as of June 8, 2009 of approximately $5,965,000 is
not sufficient to implement fully all of our various business strategies for the DR-70 test kit or
to market the DR-70 test kit or our Goodnak/Nalefen Skin Care Human Placental Extract (HPE)
products internationally by ourselves. Even if we are successful in obtaining additional financing,
and notwithstanding any cash generated from our pharmaceutical operations in China that may be
available to us, our short-term strategies are to engage outside distributors and license our
products to others, although there can be no assurances that our products can be successfully
licensed and/or marketed.
Our operations in China involve significant risk.
JJB and YYB operate as wholly-foreign owned enterprises (WFOEs) in China. Risks associated
with operating as a WFOE include unlimited liability for claims arising from operations in China
and potentially less favorable treatment from governmental agencies in China than JJB and YYB would
receive if JJB and YYB operated through a joint venture with a Chinese partner.
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JJB and YYB are subject to the Pharmaceutical Administrative Law, which governs the licensing,
manufacture, marketing and distribution of pharmaceutical products in China and sets penalty
provisions for violations of provisions of the Pharmaceutical Administrative Law. Compliance with
changes in law may require us to incur additional expenditures or could impose additional
regulation on the prices charged for our pharmaceutical products, which could have a material
impact on our consolidated financial position, results of operations and cash flows.
As in the case of JJB, the Chinese government has the right to annex or take facilities it
deems necessary. Currently, a portion of JJBs facility that produces large- and small-volume
parenteral solutions has been identified for annexation by the Chinese Military Department. The
outcome of this event cannot be predicted at this time; but, if the Chinese government takes this
facility, although we expect that JJB will be compensated fairly for it, JJB will have to spend
significant time and resources finding another location and restarting those operations in another
area. We intend to consolidate JJB and any operations related to product lines retained after the
planned sale of YYB into a single facility in a new location. Such new location will need to obtain
GMP certification. Such annexation, or the threat of such annexation, may negatively impact our
results of operation and financial condition.
The value of the Yuan Renminbi (RMB) fluctuates and is subject to changes in Chinas
political and economic conditions. Historically, the Chinese government has benchmarked the RMB
exchange ratio to the U.S. dollar, thereby mitigating the associated foreign currency exchange rate
fluctuation risk; however, no assurances can be given that the risks related to currency deviations
of the RMB will not increase in the future. Additionally, the RMB is not freely convertible into
foreign currency and all foreign exchange transactions must take place through authorized
institutions.
We may not be able to continue to operate our business if we are unable to attract additional
operating capital.
The current level of our revenues is not sufficient to finance all of our operations on a
long-term basis. We manage our cash generated from operations in China and currently transfer funds
previously advanced to JPI to meet our U.S. operating cash needs. We continue to attempt to raise
additional debt or equity financing as our operations do not produce sufficient cash to offset the
cash drain of growth in pharmaceutical sales and our general operating and administrative expenses.
Accordingly, our business and operations are substantially dependent on our ability to raise
additional capital to: (i) finance the costs of SFDA approval for the DR-70 test kit in China; (ii)
to move JPI to new facilities; (iii) expand sales and the costs of marketing of new and existing
products; and (iv) fund ongoing selling, general and administrative expenses of our business. If we
do not receive additional financing, or if our China operations do not or cannot support our
operating cash needs in the U.S., the Company will have to restrict or discontinue certain
operations both in China and in the U.S. No assurances can be given that our China pharmaceutical
operations will generate enough cash to meet our cash needs in the US to enable us to pay our
continuing obligations when due or to continue to operate our business.
At
June 8, 2009, we had cash on hand in the U.S. and China of approximately $5,965,000.
Our operations in China currently generate positive cash from operations, but the availability to
our U.S. operations of any cash from our operations in China and the timing thereof may be
uncertain. Our receivables in China have been outstanding for extended periods, and we have
experienced delays in collection. Accordingly, there can be no assurances that any funds from our
China operations will be available to defray operating expenses in the U.S. in the future. Our U.S.
operations require approximately $425,000 per month to fund the costs associated with our financing
activities; SEC and NYSE reporting; legal and accounting expenses of being a public company; other
general and administrative expenses; research and development, regulatory compliance, and
distribution activities related to DR-70 test kits; the operation of a USFDA-approved
pharmaceutical manufacturing facility; the development of international distribution of the
Companys planned HPE-based cosmetics product line; and compensation of executive management in the
U.S. and China. In lieu of reinvesting all cash flow from Chinese operations in China, currently
the necessary funds to meet our cash flow obligations in the United States are being transferred
from JPI and/or JJB to AMDL in the United States. Assuming
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(i) JJB and YYB do not undertake significant new activities that require additional capital, (ii)
the current level of revenue from the sale of DR-70 test kits does not increase in the near
future, (iii) we do not conduct any full scale clinical trials for the DR-70 test kit or our CIT
technology in the U.S. or China, (iv) JPI continues to generate sufficient cash to meet or exceed
its cash requirements, (v) no outstanding warrants are exercised, and (vi) no additional equity or
debt financings are completed, the amount of cash on hand is expected to be sufficient to meet our
projected operating expenses on a month-to-month basis as long as JPI or JJB continues to generate
enough cash from operations that can be timely sent to the U.S. to meet the operating expenses of
the Company in the U.S.
Our independent registered public accounting firm has included a going concern paragraph in their
report on our financial statements.
While our independent registered public accounting firm expressed an unqualified opinion on
our consolidated financial statements, our independent registered public accounting firm did
include an explanatory paragraph indicating that there is substantial doubt about our ability to
continue as a going concern due to our significant operating loss in 2007, our negative cash flows
from operations through December 31, 2008 and our accumulated deficit at December 31, 2008. Our
ability to continue as an operating entity currently depends, in large measure, upon our ability to
generate additional capital resources. In light of this situation, it is not likely that we will be
able to raise equity. While we seek ways to continue to operate by securing additional financing
resources or alliances or other partnership agreements, we do not at this time have any commitments
or agreements that provide for additional capital resources. Our financial condition and the going
concern emphasis paragraph may also make it more difficult for us to maintain existing customer
relationships and to initiate and secure new customer relationships.
Our current products cannot be sold in certain countries if we do not obtain and maintain
regulatory approval.
We manufacture, distribute and market our products for their approved indications. These
activities are subject to extensive regulation by numerous state and federal governmental
authorities in the U.S., such as the USFDA and the Centers for Medicare and Medicaid Services
(formerly Health Care Financing Administration) and the SFDA in China, as well as by certain
foreign countries, including some in the European Union. Currently, we (or our distributors) are
required in the U.S. and in foreign countries to obtain approval from those countries regulatory
authorities before we can market and sell our products in those countries. Obtaining regulatory
approval is costly and may take many years, and, after it is obtained, it remains costly to
maintain. The USFDA and foreign regulatory agencies have substantial discretion to terminate any
clinical trials, require additional testing, delay or withhold registration and marketing approval
and mandate product withdrawals. In addition, later discovery of unknown problems with our products
or manufacturing processes could result in restrictions on such products and manufacturing
processes, including potential withdrawal of the products from the market. If regulatory
authorities determine that we have violated regulations or if they restrict, suspend or revoke our
prior approvals, they could prohibit us from manufacturing or selling our products until we comply,
or indefinitely.
Our future prospects will be negatively impacted if we are unsuccessful in pending litigation over
the CIT technology.
We are engaged in litigation with AcuVector Group, Inc. (AcuVector) and with the Governors
of the University of Alberta over our CIT technology. Although these cases are still in the early
stages of discovery, we believe they are without merit and that we will receive a favorable
judgment in both. However, if either AcuVector or the University is successful in their claims, we
may be liable for substantial damages, our rights to the technology will be adversely affected, and
our future prospects for exploiting or licensing the CIT technology will be significantly impaired.
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The value of our intangible assets may not be equal to their carrying values.
One of our intangible assets includes the CIT technology, that we acquired from Dr. Chang in
August 2001. We also purchased certain other intangible assets in our acquisition of JPI and
purchased additional production rights in 2007. Whenever events or changes in circumstances
indicate that the carrying value may not be recoverable, we are required to evaluate the carrying
value of such intangibles, including the related amortization periods. Whenever events or changes
in circumstances indicate that the carrying value of an intangible asset may not be recoverable, we
determine whether there has been impairment by comparing the anticipated undiscounted cash flows
from the operation and eventual disposition of the product line with its carrying value. If the
undiscounted cash flows are less than the carrying value, the amount of the impairment, if any,
will be determined by comparing the carrying value of each intangible asset with its fair value.
Fair value is generally based on either a discounted cash flows analysis or market analysis. Future
operating income is based on various assumptions, including regulatory approvals, patents being
granted, and the type and nature of competing products.
Patent approval for eight original claims related to the CIT technology was obtained in May
2004 and a continuation patent application was filed in 2004 for a number of additional claims. No
regulatory approval has been requested for our CIT technology and we do not have the funds to
conduct the clinical trials that would be required to obtain regulatory approval for our CIT
technology. Accordingly, we are seeking a strategic partner to license the CIT technology from us.
If we cannot attract a large pharmaceutical company to license our CIT technology and conduct the
trials required to obtain regulatory approval, or if regulatory approvals or patents are not
obtained or are substantially delayed, or other competing technologies are developed and obtain
general market acceptance, or market conditions otherwise change, our CIT technology and other
intangible technology may have a substantially reduced value, which could be material. As
intangible assets represent a substantial portion of assets in our consolidated balance sheet, any
substantial deterioration of value would significantly impact our reported consolidated financial
position and our reported consolidated operating results.
Some of the production right intangible assets purchased from Jiangxi YiBo Medicine Technology
Development, Ltd. by JPI have not yet received manufacturing permits or been commercialized. We may
have to recognize impairments of some of these intangible assets in the future.
If our intellectual property positions are challenged, invalidated or circumvented, or if we fail
to prevail in future intellectual property litigation, our business could be adversely affected.
The patent positions of pharmaceutical and biotechnology companies can be highly uncertain and
often involve complex legal, scientific and factual questions. To date, there has emerged no
consistent policy regarding breadth of claims allowed in such companies patents. Third parties may
challenge, invalidate or circumvent our patents and patent applications relating to our products,
product candidates and technologies. In addition, our patent positions might not protect us against
competitors with similar products or technologies because competing products or technologies may
not infringe our patents.
We face substantial competition, and others may discover, develop, acquire or commercialize
products before or more successfully than we do.
We operate in a highly competitive environment. Our products compete with other products or
treatments for diseases for which our products may be indicated. Additionally, some of our
competitors market products or are actively engaged in research and development in areas where we
are developing product candidates. Large pharmaceutical corporations have greater clinical,
research, regulatory and marketing resources than we do. In addition, some of our competitors may
have technical or competitive advantages over us for the development of technologies and processes.
These resources may make it difficult for us to compete with them to successfully discover, develop
and market new products.
10
We have limited sales of the DR-70 test kit and are reliant on our distributors for sales of our
products.
Prior to the acquisition of JPI, virtually all of our operating revenues came from sales to
two distributors of the DR-70 test kits in foreign countries and from sales to a few domestic
customers of certain OEM products. For the year ended December 31, 2008, virtually all of our
revenues in the U.S. were derived from sales of DR-70 test kits. Historically, we have not
received any substantial orders from any of our customers or distributors of DR-70 test kits.
Moreover, none of our existing distributors or customers is contractually required to buy any
specific number of DR-70 test kits from us. Accordingly, based upon this fact and historical
sales, any projection of future orders or sales of DR-70 test kits is unreliable. In addition, the
amount of DR-70 test kits purchased by our distributors or customers can be adversely affected by
a number of factors, including their budget cycles and the amount of funds available to them for
product promotion and marketing.
JPI is reliant on its distributors for sales of its products.
Most of JPIs products are sold to distributors. JPIs distributors are not required to
purchase any minimum quantity of products; however, many of JPIs distribution agreements are
subject to termination and cancellation if minimum quantities of specified products are not
purchased by the distributors. JPI has never terminated any distributor for failure to meet the
minimum quantity sales targets.
We are subject to risks associated with our foreign distributors.
Our business strategy includes the continued dependence on foreign distributors for our DR-70
test kits and local distributors in China for JPIs products. To date, we have not been successful
in generating a significant increase in sales for DR-70 test kits through distribution channels in
existing markets or in developing distribution channels in new markets. We are also subject to the
risks associated with our distributors operations, including: (i) fluctuations in currency
exchange rates; (ii) compliance with local laws and other regulatory requirements; (iii)
restrictions on the repatriation of funds; (iv) inflationary conditions; (v) political and economic
instability; (vi) war or other hostilities; (vii) overlap of tax structures; and (viii)
expropriation or nationalization of assets. The inability to manage these and other risks
effectively could adversely affect our business.
Adverse conditions in the global economy and disruption in financial markets could impair our
revenues and results of operations.
As widely reported, financial markets in the United States, Europe and Asia have been
experiencing extreme disruption in recent months, including, among other things, extreme volatility
in security prices, severely diminished liquidity and credit availability, rating downgrades of
certain investments and declining valuations of others. These conditions have impaired our ability
to access credit markets and finance operations already. There can be no assurance that there will
not be a further deterioration in financial markets and confidence in major economies. We are
impacted by these economic developments, both domestically and globally, as our business requires
additional capital to build inventories and exploit new markets. In addition, the current
tightening of credit in financial markets adversely affects the ability of our customers to obtain
financing for significant purchases and operations, and has resulted in a decrease in orders for
our products, and increases the number of days outstanding of our accounts receivable in China. Our
customers ability to pay for our products may also be impaired, which may lead to an increase in
our allowance for doubtful accounts and write-offs of accounts receivable. We are unable to predict
the likely duration and severity of the current disruption in financial markets and adverse
economic conditions in the U.S., China and other countries. Should these economic conditions result
in us not meeting our revenue objectives, our operating results and financial condition could be
adversely affected.
11
We do not intend to pay dividends on our common stock in the foreseeable future.
We currently intend to retain any earnings to support our growth strategy and do not
anticipate paying dividends in the foreseeable future.
If we fail to comply with the rules under the Sarbanes-Oxley Act related to accounting controls and
procedures or if the material weaknesses or other deficiencies in our internal accounting
procedures are not remediated, our stock price could decline significantly.
Section 404 of the Sarbanes-Oxley Act required annual management assessments of the
effectiveness of our internal controls over financial reporting commencing December 31, 2007 and
requires a report by our independent registered public accounting firm addressing the effectiveness
of our internal control over financial reporting commencing for the year ending December 31, 2009.
Our management has concluded that the consolidated financial statements included in our Annual
Reports on Form 10-K as of December 31, 2008 and 2007 and for the two years ended December 31,
2008, fairly present in all material respects our consolidated financial condition, results of
operations and cash flows in conformity with accounting principles generally accepted in the U.S.
Our management has evaluated the effectiveness of our internal control over financial
reporting as of December 31, 2008 and 2007 based on the control criteria established in a report
entitled Internal Control Integrated Framework, issued by the Committee of Sponsoring
Organizations of the Treadway Commission. Based on this evaluation, our management has concluded
that our internal control over financial reporting was not effective as of December 31, 2008 and
2007. During its evaluation, as of December 31, 2008, our management identified material weaknesses
in our internal control over financial reporting and other deficiencies as described in Item 9A of
the Form 10-K for the year ending December 31, 2008 incorporated herein. As a result, our investors
could lose confidence in us, which could result in a decline in our stock price.
We are taking steps to remediate our material weaknesses, as described in Item 9A. If we fail
to achieve and maintain the adequacy of our internal controls, we may not be able to ensure that we
can conclude in the future that we have effective internal controls over financial reporting in
accordance with Section 404 of the Sarbanes-Oxley Act. Moreover, effective internal controls,
particularly those related to revenue recognition, are necessary for us to produce reliable
financial reports and are important to helping prevent financial fraud. If we cannot provide
reliable financial reports or prevent fraud, our business and operating results could be harmed,
investors could lose confidence in our reported financial information, and the trading price of our
stock could decline significantly. In addition, we cannot be certain that additional material
weaknesses or other significant deficiencies in our internal controls will not be discovered in the
future.
Our stock price is volatile, which could adversely affect your investment.
Our stock price, like that of other international bio-pharma and/or cancer diagnostic and
treatment companies, is highly volatile. Our stock price may be affected by such factors as:
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clinical trial results;
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product development announcements by us or our competitors;
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regulatory matters;
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announcements in the scientific and research community;
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intellectual property and legal matters;
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12
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broader industry and market trends unrelated to our performance;
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economic markets in Asia; and
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competition in local Chinese markets where we sell JPIs product.
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In addition, if our revenues or operating results in any period fail to meet the investment
communitys expectations, there could be an immediate adverse impact on our stock price.
Our stock price and financing may be adversely affected by outstanding warrants and convertible
securities.
We have a significant number of warrants outstanding and a large amount of convertible notes
that over hang the market for our common stock. As of
June 8, 2009, we had (i) warrants
outstanding that are currently exercisable for up to an aggregate of 5,851,099 shares at a weighted
average price of $3.15 per share and (ii) 2,091,667 shares of common stock potentially issuable on
conversion of our 10% convertible notes at $1.20 per share. The existence of, and/or exercise of all or a portion
of these securities, create a negative and potentially depressive effect on our stock price because
investors recognize that they over hang the market at this time, which effect may be exacerbated
by their inclusion in this prospectus.
We have limited product liability insurance.
We currently produce products for clinical
studies and for investigational purposes. We are
producing our products in commercial sale quantities, which will increase as we receive various
regulatory approvals in the future. There can be no assurance, however, that users will not claim
that effects other than those intended may result from our products, including, but not limited to,
claims alleged to be related to incorrect diagnoses leading to improper or lack of treatment in
reliance on test results. In the event that liability claims arise out of allegations of defects in
the design or manufacture of our products, one or more claims for damages may require the
expenditure of funds in defense of such claims or one or more substantial awards of damages against
us, and may have a material adverse effect on us by reason of our inability to defend against or
pay such claims. We carry product liability insurance for any such claims, but only in an amount
equal to $2,000,000 per occurrence, and $2,000,000 aggregate liability, which may be insufficient
to cover all claims that may be made against us.
13
DESCRIPTION OF OFFERINGS
10% Convertible Note Offering
On
September 15, 2008, we conducted the closing of our 10% Convertible Note private
offering under Regulation D and Regulation S of $2,510,000 of 10%
Convertible Promissory Notes (the Convertible Notes). The
Convertible Notes mature on the earlier of: (i) twelve
months from the completion of the closing of a registered follow-on Public Offering (as defined
below) of our common stock, par value $.001 per share, or (ii) twenty-four
months after issuance of the Convertible Notes (the Maturity Date). For purposes thereof, Public
Offering shall mean a qualified equity offering of not less than $25 million in gross proceeds.
The Convertible Notes bear interest at the annual rate of ten percent (10%) which shall accrue and
be payable on the Maturity Date. If all of the principal amount of a Convertible Note has not been
voluntarily converted by the holder or a Public Offering causing a mandatory conversion shall not
have occurred prior to the Maturity Date, the note holder shall receive additional interest (Bonus
Interest) equal to fifty percent (50%) of the remaining principal amount of the Convertible Note
on the Maturity Date. Any unpaid Bonus Interest shall accrue interest thereafter at the rate of ten
percent (10%) per annum thereon until paid.
The holders of the Notes have the right to convert the entire principal and accrued interest of the
Notes into our common stock at any time prior to the Maturity Date, provided that the conversion
price has been fixed in accordance with the terms of the Convertible Notes. The conversion price
was to be at a fifty percent (50%) discount to: (i) the closing price of our common stock on the
closing of the Public Offering, or (ii) if there was no Public Offering within six months from the
date of receipt of approval to issue the Convertible Notes by the NYSE Alternate US, then at the
closing price of our common stock on February 15, 2009; provided, however, in no event was the
conversion price to be less than $1.20 per share. As there was no Public Offering, and the closing
price on February 15, 2009 was less than $1.20, the conversion price was fixed at the floor price
of $1.20 per share.
Upon conversion of the Convertible Notes into shares of our common stock, the Company shall issue
warrants to purchase common stock (Investor Warrants) to the converting Investors in the amount
equal to fifty percent (50%) of the number of shares of common stock into which the Convertible
Notes were converted. These Investor Warrants have a term of five (5) years from the date of
issuance and shall be exercisable at a price equal to 120% of the closing price of our common stock
on the date of conversion; provided, however, in no event shall the exercise price of the Investor
Warrants be less than 120% of the five day VWAP of the Companys common stock on the closing date
of the Convertible Note Offering.
In connection with the offer and sale of the Convertible Notes in the Convertible Note Offering, we
relied on the exemption under Section 4(2) of the Securities Act of 1933, as amended (the
Securities Act), Regulation S and Regulation D, Rule 506 promulgated thereunder. We believe that
all of the purchasers of Notes are accredited investors, as such term is defined in Rule 501 (a)
under the Securities Act. In connection with the sale of Notes in the Note Offering, we
14
utilized the services of Jesup & Lamont Securities Corporation and Dawson James Securities, Inc.,
FINRA (NASD) member broker-dealers, the (Placement Agents). For their services, the Placement
Agents received commissions of 10% of the amount of the notes and the Placement Agents received an
aggregate of $313,750 (2.5%) as due diligence and non-accountable expenses. The Placement Agents
and their assigns received five-year warrants (Placement Agent Warrants) to purchase up to a
maximum aggregate of 209,167 shares of the Companys common
stock. The exercise price of the Placement Agent Warrants is $2.69, representing 115% of the five day VWAP of our common stock
up through and including September 12, 2008.
12% Senior Note Offering
On December 8, 2008, we conducted a first closing (the First Closing) of a private offering of
12% Senior Notes (the Senior Note Offering) under Regulation D for the sale to accredited
investors of units consisting of $1,077,500 principal amount of 12% Senior Notes (Senior Notes)
and five-year warrants to purchase a total of 862,000 shares of our common stock at $1.00 per share
(the Warrant Shares). We received $1,077,500 in gross proceeds (net proceeds of $947,425) in the
First Closing. Under the terms of the offering, the exercise price of the warrants was to be
the greater of 115% of the five day weighted average closing prices of our common stock as reported by
AMEX for the five trading days ended on December 4, 2008 or $1.00 per share.
In connection with the offer and sale of securities to the purchasers in the First Closing, our
exclusive placement agent was Cantone Research, Inc., a FINRA member broker- dealer. Cantone
Research, Inc. received sales commissions of $107,750 and non-accountable expenses of $32,325. In
addition, we issued placement agent warrants to purchase a total of 86,200 shares, of which Cantone
Research, Inc. received placement agent warrants to purchase 77,580 shares and Galileo Asset
Management, S. A. received warrants to purchase 8,620 shares. The
warrants issued to the placement agents in the First Closing are on
identical terms to the warrants issued to the investors in the 12%
Senior Note Offering.
On January 30, 2009, we conducted the second and final closing (the Final Closing) of the Senior
Note Offering of units consisting of $680,000 principal amount of 12% Senior Notes and five-year
warrants to purchase a total of 544,000 shares of our common stock at $1.13 per share. Under the
terms of the offering, the exercise price of the Warrant Shares was
to be the greater of 115% of the
five day weighted average closing prices of our common stock as reported by NYSE Alternext US for
the five trading days ended on January 30, 2009 or $1.00 per share.
In connection with the Final Closing, our exclusive placement agent was Cantone Research, Inc., a
FINRA member broker- dealer. Cantone Research, Inc. received sales commissions of $68,000 and
$27,900 non-accountable expenses for services in connection with the Final Closing. In addition,
in the Final Closing we issued placement agent warrants to purchase a total of 54,400 shares, of
which Cantone Research, Inc. received placement agent warrants to purchase 44,560 shares, Galileo
Asset Management, S. A. received warrants to purchase 7,840
15
shares and
Security Research Associates, Inc. received placement agent warrants to purchase 2,000
shares. The warrants issued to the placement agents in the Final
Closing are on identical terms to the warrants issued to the
investors in the 12% Senior Note Offering.
In connection with the 12%
Senior Note Offering, we agreed to file a registration statement by July
31, 2008 with the Securities and Exchange Commission on Form S-3 covering the secondary offering
and resale of the Warrant Shares sold in the 12% Senior Note Offering. This registration statement was filed in
respect of this contractual commitment.
We relied on the exemption from registration provided by Section 4(2) of the Securities Act, and Rule 506 promulgated thereunder in connection with the
12% Senior Note Offering. We believe that the purchasers are
accredited investors, as such term
is defined in Rule 501(a) promulgated under the Securities Act.
USE OF PROCEEDS
We will
not receive any proceeds from the sale of the shares issuable upon the exercise of the outstanding
warrants by the selling stockholders in the 12% Senior Note Offering pursuant to this
prospectus, nor will we receive any proceeds from the conversion of
the outstanding 10% convertible notes. We may receive
proceeds from the issuance of shares of our common stock upon the
exercise of the warrants issued in the 12% Senior Note Offering. These
warrants issued in the 12% Senior Note Offering are exercisable at a weighted average exercise price of
$1.05. We intend to use any proceeds from the exercise of warrants for
working capital and other general corporate purposes. These warrants and the issuance of the
shares of common stock underlying these warrants upon their exercise by the selling stockholders
are not being offered under this prospectus; however, the shares of our common stock, issuable upon
exercise of these warrants, are being offered under this prospectus by the selling stockholders.
There
is no assurance that any of the warrants issued in the 12% Senior Note
Offering will ever be exercised. If all of the warrants issued in the
12% Senior Note Offering (including the placement agent warrants) are exercised for cash, we would receive aggregate gross proceeds of
approximately $1,624,000.
16
SELLING STOCKHOLDERS
This
prospectus relates to the offering and sale, from time to time, of up
to 4,259,197 shares
of our common stock by the stockholders named in the table below. All of the selling stockholders
named below acquired their shares of our common stock and warrants directly from us in private
transactions.
The
following table sets forth certain information known to us, as of
June 8, 2009, and as
adjusted to reflect the sale of the shares offered hereby, with respect to the beneficial ownership
of common stock by the selling stockholders. The selling stockholders may sell all or some of the
shares of common stock they are offering, and may sell shares of our common stock otherwise than
pursuant to this prospectus. It also assumes that each of the stockholders who have warrants
exercises all of such warrants and sells all of the shares issued upon exercise thereof. The table
below assumes that the selling stockholders sell all of the shares offered by them in offerings
pursuant to this prospectus, and neither dispose of nor acquire any additional shares. We are
unable to determine the exact number of shares that will actually be sold or when or if these sales
will occur.
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Shares beneficially
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owned as of
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No. of Shares
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Shares beneficially
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June 8, 2009
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being
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owned after offering
(1)
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Name of beneficial owner
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Number
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Percentage
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Registered
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Number
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Percentage
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Massey Brothers (Feeds) Ltd. EPP
(2)
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14,167
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*
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14,167
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0
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0
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Malcolm Ramage
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4,167
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*
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4,167
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0
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0
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Michael Shah
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3,833
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*
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3,833
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0
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0
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Peter Sargent
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7,167
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*
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7,167
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0
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0
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Ian Godber
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7,042
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*
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7,042
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0
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0
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Simon Garrod
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3,750
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*
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3,750
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0
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0
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Roger Hales
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6,583
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*
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6,583
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0
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0
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David A. Bradfield
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41,667
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*
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41,667
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0
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0
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Zainab Kasmani
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14,042
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*
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14,042
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0
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0
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Jonathan Davies
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11,667
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*
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11,667
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0
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0
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Mayur Naturbhai Patel
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83,333
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*
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83,333
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0
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0
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Gerald F. Carroll
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20,833
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*
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20,833
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0
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0
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Christopher J. Macey
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21,667
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*
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21,667
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0
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0
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Zamir & Parigul Afghan
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9,792
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*
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9,792
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0
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0
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Paul Brian Meades
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20,833
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*
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20,833
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0
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0
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Stephen Charles White
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30,833
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*
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30,833
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0
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0
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Berrick Industries
(3)
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208,333
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1.8
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%
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208,333
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0
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0
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Gyronix USA LLC,
(4)
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16,667
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*
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16,667
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0
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0
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Brian JB & Jean Alice Adam
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83,333
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*
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83,333
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0
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0
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Rollo F. Thistlethwaite Thompson
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20,833
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*
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20,833
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0
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0
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Cormac OConnell
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145,833
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1.2
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%
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145,833
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0
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0
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Patrick Joseph Byrne
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40,625
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*
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40,625
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0
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0
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Stuart Sheppard
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104,167
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*
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104,167
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0
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0
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Stephen Faun
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4,483
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*
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4,483
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0
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0
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PJ Meegan-Rotec Precision Eng. Ret. Plan Trust
(5)
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41,667
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*
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41,667
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0
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0
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Steve and Linda Noble
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4,333
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*
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4,333
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0
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0
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17
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares beneficially
|
|
|
|
|
|
|
owned as of
|
|
No. of Shares
|
|
Shares beneficially
|
|
|
June
8, 2009
|
|
being
|
|
owned after offering
(1)
|
Name of beneficial owner
|
|
Number
|
|
Percentage
|
|
Registered
|
|
Number
|
|
Percentage
|
Julian Mark Williams
|
|
|
39,125
|
|
|
|
*
|
|
|
|
39,125
|
|
|
|
0
|
|
|
|
0
|
|
Philip & Adele Nielsen
|
|
|
62,500
|
|
|
|
*
|
|
|
|
62,500
|
|
|
|
0
|
|
|
|
0
|
|
Michael Villers
|
|
|
8,125
|
|
|
|
*
|
|
|
|
8,125
|
|
|
|
0
|
|
|
|
0
|
|
Peter Wells
|
|
|
8,083
|
|
|
|
*
|
|
|
|
8,083
|
|
|
|
0
|
|
|
|
0
|
|
Robert Keith
|
|
|
4,167
|
|
|
|
*
|
|
|
|
4,167
|
|
|
|
0
|
|
|
|
0
|
|
Wojciech Brykalski
|
|
|
4,167
|
|
|
|
*
|
|
|
|
4,167
|
|
|
|
0
|
|
|
|
0
|
|
Richard Brothers
|
|
|
5,825
|
|
|
|
*
|
|
|
|
5,825
|
|
|
|
0
|
|
|
|
0
|
|
Roger Huxtable
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
John Duffy
|
|
|
83,333
|
|
|
|
*
|
|
|
|
83,333
|
|
|
|
0
|
|
|
|
0
|
|
Mr. Anish Shah & Mr. Keshavlal Popat Shah
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
Allan Stuart Pulford
|
|
|
9,907
|
|
|
|
*
|
|
|
|
9,907
|
|
|
|
0
|
|
|
|
0
|
|
John Richardson
|
|
|
8,292
|
|
|
|
*
|
|
|
|
8,292
|
|
|
|
0
|
|
|
|
0
|
|
Richard Z. Boyers
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
Charles B. Wilson
|
|
|
8,750
|
|
|
|
*
|
|
|
|
8,750
|
|
|
|
0
|
|
|
|
0
|
|
Simon Jackson
|
|
|
4,250
|
|
|
|
*
|
|
|
|
4,250
|
|
|
|
0
|
|
|
|
0
|
|
Michael Trainor
|
|
|
8,311
|
|
|
|
*
|
|
|
|
8,311
|
|
|
|
0
|
|
|
|
0
|
|
Henry Bladon and Alex Larkin
|
|
|
83,333
|
|
|
|
*
|
|
|
|
83,333
|
|
|
|
0
|
|
|
|
0
|
|
Brendan Quinn Pharmacy Ltd.
(6)
|
|
|
8,333
|
|
|
|
*
|
|
|
|
8,333
|
|
|
|
0
|
|
|
|
0
|
|
Manor Park Care Ltd.
(7)
|
|
|
41,667
|
|
|
|
*
|
|
|
|
41,667
|
|
|
|
0
|
|
|
|
0
|
|
Mark David Mercer
|
|
|
19,000
|
|
|
|
*
|
|
|
|
19,000
|
|
|
|
0
|
|
|
|
0
|
|
Patrick Graham
|
|
|
25,000
|
|
|
|
*
|
|
|
|
25,000
|
|
|
|
0
|
|
|
|
0
|
|
Brittex Real Estate Corp Ltd.
(8)
|
|
|
8,833
|
|
|
|
*
|
|
|
|
8,833
|
|
|
|
0
|
|
|
|
0
|
|
Neil John Bayley
|
|
|
23,333
|
|
|
|
*
|
|
|
|
23,333
|
|
|
|
0
|
|
|
|
0
|
|
Eyes Right Opticians Ltd.
(9)
|
|
|
5,833
|
|
|
|
*
|
|
|
|
5,833
|
|
|
|
0
|
|
|
|
0
|
|
Charles W. & Elisa Q. Gregg, JTWROS
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
Garett & Cherie Guidroz
|
|
|
8,125
|
|
|
|
*
|
|
|
|
8,125
|
|
|
|
0
|
|
|
|
0
|
|
Lamar Loe
|
|
|
208,333
|
|
|
|
1.8
|
%
|
|
|
208,333
|
|
|
|
0
|
|
|
|
0
|
|
F. Larry Holcomb
|
|
|
41,667
|
|
|
|
*
|
|
|
|
41,667
|
|
|
|
0
|
|
|
|
0
|
|
John P. Christensen
|
|
|
83,333
|
|
|
|
*
|
|
|
|
83,333
|
|
|
|
0
|
|
|
|
0
|
|
William and Sally Atkins Living Trust
|
|
|
16,667
|
|
|
|
*
|
|
|
|
16,667
|
|
|
|
0
|
|
|
|
0
|
|
John E. Nash
|
|
|
23,850
|
|
|
|
*
|
|
|
|
22,333
|
|
|
|
1,500
|
|
|
|
*
|
|
Mel Gober
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
James J. Guistolisi
|
|
|
41,667
|
|
|
|
*
|
|
|
|
41,667
|
|
|
|
0
|
|
|
|
0
|
|
Carl E. Mayer
|
|
|
33,333
|
|
|
|
*
|
|
|
|
33,333
|
|
|
|
0
|
|
|
|
0
|
|
Todd Loudin
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
Palmer G. Arnold
|
|
|
20,833
|
|
|
|
*
|
|
|
|
20,833
|
|
|
|
0
|
|
|
|
0
|
|
Kadirawel Iswara
|
|
|
41,667
|
|
|
|
*
|
|
|
|
41,667
|
|
|
|
0
|
|
|
|
0
|
|
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares beneficially
|
|
|
|
|
|
|
owned as of
|
|
No. of Shares
|
|
Shares beneficially
|
|
|
June
8, 2009
|
|
being
|
|
owned after offering
(1)
|
Name of beneficial owner
|
|
Number
|
|
Percentage
|
|
Registered
|
|
Number
|
|
Percentage
|
Winston Ledlee
|
|
|
4,833
|
|
|
|
*
|
|
|
|
4,833
|
|
|
|
0
|
|
|
|
0
|
|
Richard Gender
|
|
|
7,725
|
|
|
|
*
|
|
|
|
7,725
|
|
|
|
0
|
|
|
|
0
|
|
Ed Cabrera
|
|
|
30,000
|
|
|
|
*
|
|
|
|
30,000
|
|
|
|
0
|
|
|
|
0
|
|
Todd Havermeister
|
|
|
30,000
|
|
|
|
*
|
|
|
|
30,000
|
|
|
|
0
|
|
|
|
0
|
|
Robert Giordano
|
|
|
25,000
|
|
|
|
*
|
|
|
|
25,000
|
|
|
|
0
|
|
|
|
0
|
|
Steve Oloughlin
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0
|
|
Brian Reschke
|
|
|
5,000
|
|
|
|
*
|
|
|
|
5,000
|
|
|
|
0
|
|
|
|
0
|
|
Dawson James Securities, Inc.
(10)
|
|
|
20,501
|
|
|
|
*
|
|
|
|
20,501
|
|
|
|
0
|
|
|
|
0
|
|
David Weinstein
|
|
|
25,833
|
|
|
|
*
|
|
|
|
12,833
|
|
|
|
13,000
|
|
|
|
*
|
|
Richard Aulicino
|
|
|
2,541
|
|
|
|
*
|
|
|
|
2,541
|
|
|
|
0
|
|
|
|
0
|
|
Tom Curtis
|
|
|
875
|
|
|
|
*
|
|
|
|
875
|
|
|
|
0
|
|
|
|
0
|
|
Alan Greenstein
|
|
|
533
|
|
|
|
*
|
|
|
|
533
|
|
|
|
0
|
|
|
|
0
|
|
Robert D. Keyser, Jr.
|
|
|
3,250
|
|
|
|
*
|
|
|
|
3,250
|
|
|
|
0
|
|
|
|
0
|
|
Albert Poliak
|
|
|
3,250
|
|
|
|
*
|
|
|
|
3,250
|
|
|
|
0
|
|
|
|
0
|
|
Douglas Kaiser
|
|
|
3,250
|
|
|
|
*
|
|
|
|
3,250
|
|
|
|
0
|
|
|
|
0
|
|
Frank Salvatore
|
|
|
3,250
|
|
|
|
*
|
|
|
|
3,250
|
|
|
|
0
|
|
|
|
0
|
|
Thomas Hands
|
|
|
325
|
|
|
|
*
|
|
|
|
325
|
|
|
|
0
|
|
|
|
0
|
|
William Fox
|
|
|
325
|
|
|
|
*
|
|
|
|
325
|
|
|
|
0
|
|
|
|
0
|
|
Jeffrey S. Hinkle and Kimberly L. Hinkle
|
|
|
21,500
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
1,500
|
|
|
|
*
|
|
Mordecai Bluth
|
|
|
30,000
|
|
|
|
*
|
|
|
|
30,000
|
|
|
|
0
|
|
|
|
0
|
|
Henry Gefken and Christine Gefken
(11)
|
|
|
41,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
1,000
|
|
|
|
*
|
|
Rita Landwehr
|
|
|
32,200
|
|
|
|
*
|
|
|
|
28,000
|
|
|
|
4,200
|
|
|
|
*
|
|
Estate of Morris Emory Franklin, Morris E. Franklin, Jr.,
Executor
|
|
|
21,800
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
1,800
|
|
|
|
*
|
|
Marylyn W. Rinehart, Trustee u/w Kenneth L. Rinehart Jr.
Trust A
(12)
|
|
|
22,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
2,000
|
|
|
|
*
|
|
David Benaderet Trust
(13)
|
|
|
80,000
|
|
|
|
*
|
|
|
|
80,000
|
|
|
|
0
|
|
|
|
0
|
|
Sheldon Neal and Danielle Neal
(14)
|
|
|
20,600
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0
|
|
Paul Suntup and Alan Suntup
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Patrick A. Dennis
|
|
|
16,000
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0
|
|
Robert Beachy and Elsie Beachy
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Angelo Gigliotti and Paula Gigliotti
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Maria A. Cantone
|
|
|
40,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
0
|
|
|
|
0
|
|
James Young and June Young, Joint Tenants in Common
|
|
|
23,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
3,000
|
|
|
|
*
|
|
Richard B. Franklin, Owner-Trustee of the Franklin Living
Trust
|
|
|
21,700
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
1,700
|
|
|
|
*
|
|
Bobby Nedbalek
|
|
|
43,500
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
3,500
|
|
|
|
*
|
|
Kenneth W. Embry
|
|
|
45,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
5,000
|
|
|
|
*
|
|
Anthony Cantone and Christine Cantone
(15)
|
|
|
727,250
|
|
|
|
4.1
|
%
|
|
|
160,000
|
|
|
|
567,250
|
|
|
|
3.2
|
%
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares beneficially
|
|
|
|
|
|
|
owned as of
|
|
No. of Shares
|
|
Shares beneficially
|
|
|
June 8, 2009
|
|
being
|
|
owned after offering
(1)
|
Name of beneficial owner
|
|
Number
|
|
Percentage
|
|
Registered
|
|
Number
|
|
Percentage
|
Shelton Steinle and Jeanette Steinle, Joint Tenants with
Right of Survivorship
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Newman Family Trust dated 9/30/97
(16)
|
|
|
25,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
5,000
|
|
|
|
*
|
|
Matthew Fiorilli
|
|
|
56,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
16,000
|
|
|
|
*
|
|
Bradley Cartier
(17)
|
|
|
22,600
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
2,600
|
|
|
|
*
|
|
Jeffrey M. Walters
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Alan Matthes and Lori Matthes
|
|
|
28,000
|
|
|
|
*
|
|
|
|
28,000
|
|
|
|
0
|
|
|
|
0
|
|
Kenneth Richardson
|
|
|
45,500
|
|
|
|
*
|
|
|
|
44,000
|
|
|
|
1,500
|
|
|
|
*
|
|
Jean M. Gaur
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Marlyn W. Rinehart, Trustee u/w Kenneth L. Rinehart, Jr.
Trust B
(18)
|
|
|
37,000
|
|
|
|
*
|
|
|
|
36,000
|
|
|
|
1,000
|
|
|
|
*
|
|
Goodrich Family Trust
(19)
|
|
|
22,700
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
*
|
|
The Money Market Investment Club of Toledo
(20)
|
|
|
23,300
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
2,700
|
|
|
|
*
|
|
Edward H. Gross
|
|
|
11,000
|
|
|
|
*
|
|
|
|
8,000
|
|
|
|
3,000
|
|
|
|
*
|
|
Joseph Fishman
|
|
|
40,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
0
|
|
|
|
0
|
|
Richard and Bernadette Supan
|
|
|
26,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
6,000
|
|
|
|
*
|
|
Edward H. Simonian or Adrienne Simonian
|
|
|
27,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
7,000
|
|
|
|
*
|
|
John and Janet Bloom
|
|
|
24,000
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
8,000
|
|
|
|
*
|
|
David Benaderet
(21)
|
|
|
43,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
3,000
|
|
|
|
*
|
|
Todd M. and Leaann VerStrate
|
|
|
20,000
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
George Gosen, Jr.
|
|
|
17,500
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
1,500
|
|
|
|
*
|
|
Santo Zito
|
|
|
21,700
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
5,700
|
|
|
|
*
|
|
Joel D. Fedder
(22)
|
|
|
143,500
|
|
|
|
*
|
|
|
|
60,000
|
|
|
|
83,500
|
|
|
|
*
|
|
William Embry and Helen M. Embry Trust
(23)
|
|
|
40,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
0
|
|
|
|
0
|
|
Dale Miller and Melanie Trevino
(24)
|
|
|
24,800
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
4,800
|
|
|
|
*
|
|
Robert Michael Young
|
|
|
21,500
|
|
|
|
*
|
|
|
|
20,000
|
|
|
|
0
|
|
|
|
0
|
|
Geoffrey D. Cant
|
|
|
18,000
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0
|
|
Edward Vander Meulen
|
|
|
18,600
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0
|
|
David Reklau
|
|
|
16,000
|
|
|
|
*
|
|
|
|
16,000
|
|
|
|
0
|
|
|
|
0
|
|
Octagon Capital Partners
(25)
|
|
|
40,000
|
|
|
|
*
|
|
|
|
40,000
|
|
|
|
0
|
|
|
|
0
|
|
Jesup & Lamont Securities Corporation
(26)
|
|
|
63,333
|
|
|
|
*
|
|
|
|
63,333
|
|
|
|
0
|
|
|
|
0
|
|
Neil Kohlhaas dba Kohlhaas Consulting
|
|
|
12,500
|
|
|
|
*
|
|
|
|
12,500
|
|
|
|
0
|
|
|
|
0
|
|
B &D Consulting, Inc.
(27)
|
|
|
400,000
|
|
|
|
2.4
|
%
|
|
|
400,000
|
|
|
|
0
|
|
|
|
0
|
|
Strategic Growth International, Inc.
(28)
|
|
|
37,500
|
|
|
|
*
|
|
|
|
37,500
|
|
|
|
0
|
|
|
|
0
|
|
Cantone Research Inc.
(29)
|
|
|
172,140
|
|
|
|
*
|
|
|
|
122,140
|
|
|
|
50,000
|
|
|
|
*
|
|
Galileo Asset Management, S.A.
(30)
|
|
|
286,473
|
|
|
|
1.6
|
%
|
|
|
16,460
|
|
|
|
270,013
|
|
|
|
1.5
|
%
|
Security Research Associates, Inc.
(31)
|
|
|
2,000
|
|
|
|
*
|
|
|
|
2,000
|
|
|
|
0
|
|
|
|
0
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
4,259,197
|
|
|
|
|
|
|
|
|
|
20
|
|
|
|
*
|
|
Less than 1%
|
|
|
(1)
|
|
Assumes all shares being registered hereunder are sold.
|
|
(2)
|
|
Richard Massey, Managing Director and Trustee, has sole voting and investment power
with respect to these shares.
|
|
(3)
|
|
Rick Early, principal owner, has sole voting and investment power with respect to
these shares.
|
|
(4)
|
|
Nicholas Tippler, Managing Director and owner, has sole voting and investment power
with respect to these shares.
|
|
(5)
|
|
PJ Meegan, Niamh McDonald and Aidan McLaughlin, Trustees, have joint voting and
investment power with respect to these shares.
|
|
(6)
|
|
Brendan Quinn, Managing Director, has sole voting and investment power with respect
to these shares.
|
|
(7)
|
|
Henry Bladon and Peter Allen, Directors, have joint voting and investment power with
respect to these shares.
|
|
(8)
|
|
Christopher Davies, Managing Director, has sole voting and investment power with
respect to these shares.
|
|
(9)
|
|
Vipan Jain, Director, has sole voting and investment power with respect to these
shares.
|
|
(10)
|
|
David Weinstein, President, and Robert Keyser, Chairman, have joint voting and
investment power with respect to these shares.
|
|
(11)
|
|
Includes 1,000 shares owned by Ms. Gefkens IRA.
|
|
(12)
|
|
Marlyn W. Rinehart, Trustee, has sole voting and investment power with respect to
these shares. Does not include 21,000 shares held by Kenneth L. Rinehart, Jr. Trust B.
|
|
(13)
|
|
David Benaderet, Trustee, has sole voting and investment power with respect to
these shares. Does not include 43,000 shares held by Mr. Benaderet individually.
|
|
(14)
|
|
Includes 4,600 shares in the name of Sheldon Neal for which Danielle Neal disclaims
beneficial ownership.
|
|
(15)
|
|
Includes 86,000 shares owned by Mr. and Mrs. Cantone, 20,000 shares owned by Mr.
Cantone individually, 67,500 shares owned by Mr. Cantones IRA, 121,610 shares owned by
Cantone Office Center, LLC, 172,140 shares owned by Cantone Research Inc. (which includes
warrants to purchase 122,140). All of these shares are deemed beneficially owned by Mr.
Cantone.
|
|
(16)
|
|
Larry Newman, Trustee, has sole voting and investment power with respect to these
shares.
|
|
(17)
|
|
Includes 2,600 shares owned by Entrust Midwest, LLC, an entity controlled by Mr.
Cartier.
|
|
(18)
|
|
Marlyn W. Rinehart, Trustee, has sole voting and investment power with respect to
these shares. Does not include 22,000 shares held by Kenneth L. Rinehart, Jr. Trust A.
|
|
(19)
|
|
Raymond H. Goodrich and Dorothea Goodrich, Co-Trustees, have joint voting and
investment power with respect to the shares held by the trust. Also includes 1,000 shares
held by Mr. Goodrich individually and 1,700 shares held by Mr. Goodrichs IRA for which Mrs.
Goodrich disclaims beneficial interest.
|
|
(20)
|
|
Mark D. Weber, Managing Partner, has sole voting and investment power with respect
to these shares.
|
|
(21)
|
|
Does not include 80,000 shares held by the David Benaderet Trust.
|
21
|
|
|
(22)
|
|
Includes 83,500 shares held in the name of American National Mortgage, LLC of which
Mr. Fedder is the managing member.
|
|
(23)
|
|
William Embry and Helen M. Embry, Co-Trustees, have joint voting and investment
power with respect to these shares.
|
|
(24)
|
|
Includes 2,000 shares owned by Mr. Miller individually.
|
|
(25)
|
|
Steven Hart, Portfolio Manager, has sole voting and investment power with respect
to these shares.
|
|
(26)
|
|
Ed Cabrera has sole voting and investment power with respect to these shares.
|
|
(27)
|
|
Deanna Sleeper Brower, President, has sole voting and investment power with respect
to these shares.
|
|
(28)
|
|
Richard E. Cooper, Chairman, has sole voting and investment power with respect to
these shares.
|
|
(29)
|
|
Anthony J. Cantone, President, has sole voting and investment power with respect to
these shares. Does not include any shares owned by Mr. or Mrs. Cantone individually or by
Cantone Office Center, LLC.
|
|
(30)
|
|
Christine-Marie Wright, President, has sole voting and investment power with
respect to these shares. Includes warrants to purchase an additional 270,013 shares which are
currently exercisable.
|
|
(31)
|
|
Brian Swift, CEO, President, has sole voting and investment power with respect to
these shares.
|
Except as otherwise indicated above or in the footnotes to the table, the selling stockholders
have not held any position or office or had any material relationship with us or any of its
subsidiaries within the past three years and the selling stockholders possess sole voting and
investment power with respect to the shares shown.
The selling stockholders will sell their shares in one or more market transactions on the NYSE
Alternext US or in privately negotiated transactions at standard terms, including commissions at
market rates for similar transactions.
PLAN OF DISTRIBUTION
Shares of common stock covered hereby may be offered and sold from time to time by the selling
stockholders. Each selling stockholder will act independently of us in making decisions with
respect to the timing, manner and size of each sale. Each selling stockholder may sell the shares
being offered hereby (i) on the NYSE Alternext US, or otherwise at prices and at terms then
prevailing or at prices related to the then current market price or (ii) in private sales at
negotiated prices or by a combination of such methods of sale.
Any broker-dealer participating in such transactions as agent may receive commissions from
each selling stockholder (and, if acting as agent for the purchaser of such shares, from such
purchaser). Usual and customary brokerage fees will be paid by each selling stockholder.
Broker-dealers may agree with each selling stockholder to sell a specified number of shares at a
stipulated price per share, and, to the extent such a broker-dealer is unable to do so acting as
agent for each selling stockholder, to purchase as principal any unsold shares at the price
required to fulfill the broker-dealer commitment to each selling stockholder. Broker-dealers who
acquire shares as principal may thereafter resell such shares from time to time in transactions
(which may involve crosses and block transactions and which may involve sales to and through other
broker-dealers, including transactions of the nature described above) on the NYSE Alternext US, in
negotiated transactions or by a combination of such methods of sale or otherwise at market prices
prevailing at the time of sale or at negotiated prices, and in connection with such resales may pay
to or receive from the purchasers of such shares commissions computed as described above.
22
Each selling stockholder and any underwriter, dealer or agent who participates in the
distribution of such shares may be deemed to be underwriters under the Securities Act of 1933,
and any discount, commission or concession received by such persons might be deemed to be an
underwriting discount or commission. Each selling stockholder may indemnify any broker-dealer who
participates in transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act of 1933.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be passed upon by Baker &
Hostetler LLP, Costa Mesa, California.
EXPERTS
Our consolidated financial statements incorporated in this prospectus by reference to our
Annual Report on Form 10-K for the year ended December 31, 2008 have been audited by KMJ | Corbin &
Company LLP, an independent registered public accounting firm, and have been incorporated in this
prospectus by reference in reliance upon the report of KMJ | Corbin & Company LLP pertaining to
such consolidated financial statements and upon the authority of such firm as experts in auditing
and accounting.
AVAILABLE INFORMATION
We file annual, quarterly, and current reports, proxy statements, and other documents with the
SEC. You may read and copy any document we file at the SECs public reference room at: 100 F
Street N.E., Room 1580, Washington, DC 20549. You should call (202) 551-8090 for more information
on the public reference room. The SEC maintains an internet site at
http://www.sec.gov
where
certain reports, proxy and information statements, and other information regarding issuers
(including AMDL) may be found. In addition, such material concerning us may be inspected at the
offices of the NYSE Alternext US, 86 Trinity Place, New York, New York 10006.
This prospectus is part of a registration statement filed with the SEC. The Registration
Statement contains more information than this prospectus regarding us and our common stock,
including certain exhibits filed. You can get a copy of the Registration Statement from the SEC at
the address listed above or from the SECs internet site.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate into this prospectus information we file with it in other
documents. This means that we can disclose important information to you by referring to other
documents that contain that information. The information incorporated by reference is considered
to be part of this prospectus, and information we file later with the SEC will automatically update
and supersede this information. We incorporate by reference the documents listed below, except to
the extent information in those documents is different from the information contained in this
prospectus, and all future documents filed with the SEC under Sections 13(a), 13(c), 14, or 15(d)
of the Securities Exchange Act of 1934 until we terminate the offering of these shares:
|
|
|
Registrants Annual Report on Form 10-K for the year ended December 31, 2008 filed
with the SEC on April 15, 2009 (File No. 001-16695-09751548);
|
|
|
|
|
Registrants Quarterly Report on Form 10-Q for the three months ended March 31, 2009
filed with the SEC on May 15, 2009 (File No. 001-16695-09751548); and
|
|
|
|
|
The description of the Registrants common stock contained in its Registration
Statement on Form 8-A12B filed September 21, 2001 (File No. 001-16695-1741905).
|
23
We will provide without charge to each person, including any beneficial owner of common stock,
to whom this prospectus is delivered, upon the written or oral request of such person, a copy of
any and all of the documents that have been incorporated by reference in this prospectus (not
including exhibits to such documents unless such exhibits are specifically incorporated by
reference therein). Requests should
be directed to: AMDL, Inc., 2492 Walnut Avenue, Suite 100, Tustin, California 92780-7039,
Attention: Akio Ariura, Chief Operating Officer, Telephone (714) 505-4460.
24
PART II
INFORMATION NOT REQUIRED
IN PROSPECTUS
Item 14. Itemized Statement of Expenses.
The table below sets forth the estimated expenses (except the SEC registration fee, which is
an actual expense) in connection with the offer and sale of the shares of common stock of the
registrant covered by this Registration Statement.
|
|
|
|
|
SEC Registration Fee
|
|
$
|
355
|
|
Legal Fees and Expenses
|
|
|
15,000
|
|
Accounting Fees and Expenses
|
|
|
10,000
|
|
Printing Fees and Expenses
|
|
|
500
|
|
Miscellaneous
|
|
|
500
|
|
|
|
|
|
Total
|
|
$
|
26,355
|
|
Item 15. Indemnification of Directors and Officers.
Delaware law and AMDLs Certificate of Incorporation and Bylaws provide that AMDL shall, under
certain circumstances and subject to certain limitations, indemnify any director, officer, employee
or agent of the corporation made or threatened to be made a party to a proceeding, by reason of the
former or present official capacity of the person, against judgments, fines, settlements and
reasonable expenses incurred by the person in connection with the proceeding if certain statutory
standards are met. Any such person is also entitled, subject to certain limitations, to payment or
reimbursement of reasonable expenses in advance of the final disposition of the proceeding.
Proceeding means a threatened, pending or completed civil, criminal, administrative, arbitration
or investigative proceeding, including one by or in the right of the corporation.
AMDLs directors, officers, agents and employees are entitled to indemnification by each of
the Selling Stockholders against any losses arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in this Registration Statement and
the prospectus contained herein made in reliance upon written information furnished to AMDL by such
Selling Stockholder for use in this Registration Statement or the prospectus.
AMDL has also entered into indemnification agreements with its directors whereby AMDL has
agreed to indemnify and hold them harmless from and against any claims, liability, damages or
expenses incurred by them in or arising out of their status, capacities and activities with respect
to AMDL to the maximum extent permitted by Delaware law. AMDL believes that these agreements are
necessary to attract and retain qualified persons as directors and executive officers.
AMDL also maintains a directors and officers insurance policy with aggregate limits of
$2,000,000 pursuant to which our directors and officers are insured against liability for certain
actions in their capacity as directors and officers.
Item 16. Exhibits.
The exhibits to this Registration Statement are listed in the Index to Exhibits included
elsewhere in this Registration Statement.
II-1
Item 17. Undertakings.
(a)
|
|
The undersigned registrant hereby undertakes:
|
|
(1)
|
|
To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
|
|
(i)
|
|
To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
|
|
|
(ii)
|
|
To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the Calculation of Registration Fee
table in the effective Registration Statement;
|
|
|
(iii)
|
|
To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
|
|
|
|
provided, however
, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii)
above do not apply if the Registration Statement is on Form S-3 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in reports filed with or furnished to the SEC by the Registrant pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement, or is contained in a form of prospectus
filed pursuant to Rule 424(b) that is part of the Registration Statement.
|
|
|
(2)
|
|
That, for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
|
(3)
|
|
To remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the offering.
|
|
|
(4)
|
|
That, for the purpose of determining liability under the Securities Act of
1933, as amended, to any purchaser:
|
|
(i)
|
|
Each prospectus filed by the Registrant pursuant to Rule
424(b)(3) shall be deemed to be part of the registration statement as of the
date the filed prospectus was deemed part of and included in the registration
statement; and
|
|
|
(ii)
|
|
Each prospectus required to be filed pursuant to Rule
424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on
Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or
(x) for the purpose of providing the information required by Section 10(a) of
the Securities Act of 1933, as amended, shall be deemed to be part of and
included in the registration statement as of the earlier of the date
|
II-2
|
|
|
such form of prospectus is first used after effectiveness or the date of the
first contract of sale of securities in the offering described in the
prospectus. As provided in Rule 430B, for liability purposes of the issuer and
any person that is at that date an underwriter, such date shall be deemed to be
a new effective date of the registration statement relating to the securities in
the registration statement to which the prospectus relates, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
Provided, however,
that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such effective date,
supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such
document immediately prior to such effective date.
|
(b) The undersigned registrant hereby undertakes that, for the purposes of determining any
liability under the Securities Act of 1933, each filing of the registrants annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plans annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
provisions described under Item 15 above, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by the registrant of
expenses incurred or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of
such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Exchange 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 Pre Effective Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Tustin, State of California
on June 11, 2009.
|
|
|
|
|
|
AMDL, INC.
|
|
|
By:
|
/s/ Douglas C. MacLellan
|
|
|
|
Douglas C. MacLellan, President
|
|
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POWER OF ATTORNEY
Pursuant
to the requirements of the Securities Act of 1933, this Pre Effective Amendment No. 1 to the Registration Statement has
been signed by the following persons in the capacities on June 11, 2009.
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Signature
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Title
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/s/ Douglas C. MacLellan
DOUGLAS C. MACLELLAN
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President, Chief Executive Officer and
Director (Principal Executive Officer)
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/s/ Akio Ariura
AKIO ARIURA
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Chief Financial Officer (Principal Financial
Officer and Principal Accounting Officer)
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MICHAEL BOSWELL
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Director
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EDWARD R. ARQUILLA
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Director
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MINGHUI JIA
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Director
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/s/ William M. Thompson, III*
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WILLIAM M. THOMPSON III
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Director
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*By:
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/s/ Akio Ariura
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Akio Ariura, Attorney-in-fact
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II-4
INDEX TO EXHIBITS
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Exhibit
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5.1
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*Opinion and Consent of Baker & Hostettler LLP
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23.1
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*Consent of Baker & Hostettler LLP (included in Exhibit 5.1)
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23.2
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*Consent of KMJ | Corbin & Company LLP
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24.1
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Power of Attorney (included on the
original signature page of this Registration Statement filed
May 15, 2009)
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II-5
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