FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Protagenic Therapeutics, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 149 Fifth Avenue New York, New York 10010 212-994-8200 | 06-1390025 | ||
(State or other jurisdiction of | ||||
incorporation or organization) | (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) | (I.R.S. Employer Identification Number) |
Garo Armen
Executive Chairman
Protagenic Therapeutics, Inc.
New York,
212-994-8200
(Name, address, including zip code, and telephone number,
including
With copies to:
Dean M. Colucci, Esq.
Michelle Geller, Esq.
Kelly R. Carr, Esq.
Duane Morris LLP
1540 Broadway
New York, NY 10036
Telephone: (973) 424-2020
15260 Ventura Boulevard, 20th Floor
If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ¨
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (“Securities Act”), other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. x
If this Formform 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 statementRegistration Statement number of the earlier effective registration statementRegistration Statement for the same offering. ¨
If this Formform 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 statementRegistration Statement number of the earlier effective registration statementRegistration Statement for the same offering. ¨
If this formForm is a registration statementRegistration Statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box: ¨
If this formForm is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box: ¨
Indicate by check mark whether the registrantRegistrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer | [ ] | Accelerated filer | [ ] | |
| Non-accelerated filer | [ ] | Smaller reporting company | [X] | |
| | Emerging growth company | [ ] |
CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities To Be Registered | Amount To Be Registered (1) | Proposed Maximum Offering Price Per Unit (2)(3) | Proposed Maximum Aggregate Offering Price (2)(3) | Amount Of Registration Fee (4) | ||||||||||||
| Common Stock, par value $.01 per share | 5,963,857 | $ | 3.03 | $ | 18,070,486.71 | $ | 2,097.99 | |||||||||
| Title of each class of securities to be registered | Amount to be Registered | Proposed maximum offering price per share | Proposed maximum aggregate offering price | Amount of registration fee | ||||||||||||
| Common Stock, $0.0001 par value per share | (1) | (2) | (2) | — | ||||||||||||
| Preferred Stock, $0.000001 par value per share | (1) | (2) | (2) | — | ||||||||||||
| Depositary Shares | (1) | (2) | (2) | — | ||||||||||||
| Debt Securities | (1) | (2) | (2) | — | ||||||||||||
| Rights (3) | (1) | (2) | (2) | — | ||||||||||||
| Warrants (3) | (1) | (2) | (2) | — | ||||||||||||
| Units (4) | (1) | (2) | (2) | — | ||||||||||||
| Total | $ | 100,000,000 | $ | 10,910 | (5) | |||||||||||
| (1) |
| (2) | The proposed maximum aggregate offering price per |
| (3) | Each right or warrant will represent the right to purchase shares of |
| (4) | Each unit will represent an interest in two or more other securities, which may or may not be separable from one another. |
| (5) | Calculated in accordance with Rule 457(o) under the Securities Act and paid herewith. |
The Registrant hereby amends this registration statementRegistration 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 statementRegistration Statement shall thereafter become effective in accordance with Sectionsection 8(a) of the Securities Act of 1933 or until the registration statementthis Registration Statement shall become effective on such date as the Commission acting pursuant to said Sectionsection 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 4, 2021
PROSPECTUS
$100,000,000
Common Stock
Preferred Stock
Depositary Shares
Debt Securities
Rights
Warrants
Units
We may offer and salesell, from time to time in one or more offerings, any combination of up to 5,963,857 shares of our common stock, that are heldpreferred stock, debt securities, warrants, or units having a maximum aggregate offering price of $100,000,000. When we decide to sell a particular class or series of securities, we will provide specific terms of the offered securities in a prospectus supplement.
The prospectus supplement may also add, update or change information contained in or incorporated by the shareholders named in the “Selling Stockholders” section ofreference into this prospectus. The prices at which the selling stockholders may sell the sharesHowever, no prospectus supplement shall offer a security that is not registered and described in this offering willprospectus at the time of its effectiveness. You should read this prospectus and any prospectus supplement, as well as the documents incorporated by reference or deemed to be determinedincorporated by reference into this prospectus, carefully before you invest. This prospectus may not be used to offer or sell our securities unless accompanied by a prospectus supplement relating to the prevailing market price for the shares or in negotiated transactions. We will not receive any of the proceeds from the sale of the shares. We will bear all expenses of registration incurred in connection with this offering. The selling stockholders whose shares are being registered will bear all selling and other expenses.
Our common stock is quotedlisted on the NASDAQNasdaq Capital Market under the symbol “ATRN.“PTIX” and our Warrants are listed on the Nasdaq Capital Market under the symbol “PTIXW.” On September 27, 2011,June 3, 2021, the last reported salessale price of theour common stock on the NASDAQNasdaq Capital Market was $2.65$2.60 per share.
These securities may be sold directly by us, through dealers or agents designated from time to time, to or through underwriters or through a discussioncombination of important factors that you should consider before purchasingthese methods. See “Plan of Distribution” in this prospectus. We may also describe the sharesplan of common stock, see “Risk Factors” beginningdistribution for any particular offering of our securities in a prospectus supplement. If any agents, underwriters or dealers are involved in the sale of any securities in respect of which this prospectus is being delivered, we will disclose their names and the nature of our arrangements with them in a prospectus supplement. The net proceeds we expect to receive from any such sale will also be included in a prospectus supplement.
An investment in our securities involves a high degree of risk. See the sections entitled “Risk Factors” in our most recent Annual Report on page 9 of this prospectus.
This prospectus may not be used to offer or sell any securities unless accompanied by a prospectus supplement.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracydetermined if this prospectus is truthful or adequacy of this prospectus.complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is [●], 20112021
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| ABOUT THIS PROSPECTUS | 1 | ||
| RISK FACTORS | 5 | ||
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| USE OF PROCEEDS | 7 | ||
| DESCRIPTION OF CAPITAL STOCK | 8 | ||
| DESCRIPTION OF DEPOSITARY SHARES | 10 | ||
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This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, using a “shelf” registration process. Under this shelf registration statement, we may sell from time to time in one or more offerings up to a total dollar amount of $100,000,000 of common stock and preferred stock, depositary shares representing preferred stock and various series of debt securities, rights, warrants to purchase any of such securities, and/or units, either individually or in combination with other securities as described in this prospectus. Each time we sell any type or series of securities under this prospectus, we will provide a prospectus supplement that will contain more specific information about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings. We may also add, update or change in a prospectus supplement or free writing prospectus any of the information contained in this prospectus or in documents we have incorporated by reference into this prospectus. This prospectus, together with any applicable prospectus supplement or free writing prospectus and the documents incorporated by reference into this prospectus, include all material information relating to this offering. You should carefully read both this prospectus and any applicable prospectus supplement and any related free writing prospectus together with the additional information described under “Where You Can Find More Information” before buying securities in this offering.
You should rely only on the information contained in, or incorporated by reference into, this prospectus any supplement and the documentsapplicable prospectus supplement, along with the information contained in any free writing prospectuses we have incorporated by reference.authorized for use in connection with a specific offering. We have not authorized anyone to provide information thatyou with different or additional information. We are not making an offer to sell or seeking an offer to buy securities under this prospectus or any applicable prospectus supplement or free writing prospectus in any jurisdiction where the offer or sale is different from that contained in this prospectus.not permitted. The information contained in this prospectus, any applicable prospectus supplement or free writing prospectus and the documents incorporated by reference herein and therein are accurate only as of their respective dates, regardless of the time of delivery of this prospectus or any sale of a security.
The information appearing in this prospectus, any applicable prospectus supplement and any related free writing prospectus is accurate only as of the date on the front of the document and any information we have incorporated by reference is accurate only as of the date of suchthe document incorporated by reference, regardless of the time of delivery of this prospectus, the applicable prospectus supplement or ofany related free writing prospectus, or any sale of our common stock.
This summary highlights selected informationprospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference or contained in greater detail elsewhere in this prospectus. This summary does not contain all the information you should consider before investing in our common stock. You should read the entire prospectus and the documents incorporated by reference carefully before making an investment decision, including “Risk Factors” and the consolidated financial statements and the related notes incorporated by reference herein. References in this prospectus to “Atrinsic” “ATRN,” “we,” “our” and “us” refer to Atrinsic, Inc. and our consolidated subsidiaries.
We may sell securities through underwriters or dealers, through agents, directly to satisfypurchasers or through any combination of these methods. We and our agents reserve the foregoing obligations.
In this prospectus, unless otherwise indicated, “our company,” “Protagenic,” “we,” “us” or “our” refer to Protagenic Therapeutics, Inc., a Delaware corporation, and its consolidated subsidiaries.
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This prospectus summary highlights certain information about our company and other information contained elsewhere in this prospectus or in documents incorporated by reference. This summary does not contain all of the information that you should consider before making an investment decision. You should carefully read the entire prospectus, any prospectus supplement, including the section entitled “Risk Factors” and the documents incorporated by reference into this prospectus, before making an investment decision.
The Offering
This prospectus is part of a Registration Rights Agreement) is covered byStatement that we filed with the SEC utilizing a shelf registration process. Under this shelf registration process, we may sell any combination of:
| ● | common stock; |
| ● | preferred stock; |
| ● | debt securities, in one or more series; |
| ● | right to purchase common stock of other securities; and/or |
| ● | warrant to purchase common stock of other securities; and/or |
in one or more registrationofferings up to a total dollar amount of $100,000,000. This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of that specific offering and include a discussion of any risk factors or other special considerations that apply to those securities. The prospectus supplement may also add, update or change information contained in this prospectus. You should read both this prospectus and any prospectus supplement together with the additional information described under the heading “Where You Can Find More Information.”
Our Company
Overview
We are a biopharmaceutical corporation specializing in the discovery and development of therapeutics to treat stress-related neuropsychiatric and mood disorders utilizing synthetic forms of endogenous brain signaling peptides that can dampen overactive stress responses.
The mechanism by which we will target these stress-related disorders is based on over 15 years of work elucidating the role of Teneurin Carboxy-terminal Associated Peptide (“TCAP”), which has been found to have a central role in maintaining healthy brain signaling. TCAP is an endogenous counterbalance to the negative effects of stress and its criticality is underscored by a high degree of evolutionarily preservation. TCAP signaling counteracts the effects of Corticotropin Releasing Factor on the Hypothalamic-Pituitary-Adrenal axis, thus reducing the stress hormone cortisol. We intend to bring novel forms of TCAP into human clinical development as a treatment for stress-related neuropsychiatric disorders. Our lead compound – PT00114 – is a 41-residue peptide synthetic form of TCAP that can be administered subcutaneously, sublingually, or intra-nasally. In addition, we have a portfolio of earlier stage neuropeptides targeting the TCAP pathway that are in preclinical evaluation.
Our strategy is to develop TCAP neuropeptide-based drug candidates, beginning with PT00114, in stress-related indications, including, but not limited to: treatment resistant depression (“TRD”), which is a subgroup of major depressive disorder (“MDD”); addiction, recidivism, or substance use disorder (“SUD”); anxiety, including generalized anxiety disorder (“GAD”), and post-traumatic stress disorder (“PTSD”).
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Risk Factors Summary
Below is a summary of material factors that make an investment in our securities speculative or risky. Importantly, this summary does not address all of the risks and uncertainties that we face. Additional discussion of the risks and uncertainties summarized in this risk factor summary, as well as other risks and uncertainties that we face, can be found under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2020. The below summary is qualified in its entirety by that more complete discussion of such risks and uncertainties. You should consider carefully the risks and uncertainties described under “Risk Factors” in Part I, Item 1A of our most recent Annual Report on Form 10-K as part of your evaluation of the risks associated with an investment in our securities.
Risks Related to Our Financial Condition and Capital Requirements
● The Company’s financial statements (ii)have been prepared on a going concern basis, and do not include adjustments that might be necessary if the Company is unable to continue as a going concern.
● If we continue to incur operating losses and fail to obtain the capital necessary to fund our operations, we will be unable to advance our development programs, complete our clinical trials, or bring products to market, or may be forced to reduce or cease operations entirely. In addition, any capital obtained by us may be obtained on terms that are unfavorable to us, our investors, or both.
● Unstable market and economic conditions may have serious adverse consequences on our ability to raise funds, which may cause us to cease or delay our operations.
● Covid-19 could adversely impact our business, including our clinical trials, and financial condition.
Risks Related to Clinical Development and Regulatory Approval
● Our results to date provide no basis for predicting whether any of our product candidates will be safe or effective, or receive regulatory approval.
● We may not be able to initiate and complete preclinical studies and clinical trials for our product candidates which could adversely affect our business.
● If we experience delays or difficulties in the enrollment of subjects to our clinical trials, our receipt of necessary regulatory approvals could be delayed or prevented, which could materially affect our financial condition.
● If the market opportunities for our current and potential future drug candidates are smaller than we believe they are, our ability to generate product revenues will be adversely affected and our business may suffer.
Risks Related to Our Reliance on Third Parties
● We have no experience in sales, marketing and distribution and may have to enter into agreements with third parties to perform these functions, which could prevent us from successfully commercializing our product candidates.
● Data provided by collaborators and other parties upon which we rely have not been independently verified and could turn out to be inaccurate, misleading, or incomplete.
● We rely on third parties to conduct our non-clinical studies and our clinical trials. If these third parties do not successfully carry out their contractual duties or meet expected deadlines, we may be unable to obtain regulatory approval for or commercialize our current product candidates or any future products, on a variable rate transactiontimely basis or at all, and our financial condition will be adversely affected.
Risks Related to Commercialization of Our Product Candidates
● We have no experience as a company in commercializing any time whileproduct. If we fail to obtain commercial expertise, upon product approval by regulatory agencies, our product launch and revenues could be delayed.
● We may not be able to gain market acceptance of our product candidates, which would prevent us from becoming profitable.
● We may not be able to manufacture our product candidates in clinical or commercial quantities, which would prevent us from commercializing our product candidates.
● Disputes under key agreements or conflicts of interest with our scientific advisors or clinical investigators could delay or prevent development or commercialization of our product candidates.
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Risks Related to Our Intellectual Property
● We may not be able to maintain our exclusive worldwide license to use and develop PT00114 which could materially affect our business plan.
Risks Related to Our Business Operations and Industry
● If we are not able to retain our current senior management team and our scientific advisors or continue to attract and retain qualified scientific, technical and business personnel, our business will suffer.
● We may encounter difficulties in managing our growth, which could adversely affect our operations.
● Healthcare reform measures could adversely affect our business.
● Our business and operations are vulnerable to computer system failures, cyber-attacks or deficiencies in our cyber-security, which could increase our expenses, divert the Notes are outstanding, (iii) for a periodattention of one yearour management and key personnel away from our business operations and adversely affect our results of operations.
● Failure to comply with health and data protection laws and regulations could lead to government enforcement actions (which could include civil or criminal penalties), private litigation or adverse publicity and could negatively affect our operating results and business.
● If we, our CROs or our IT vendors experience security or data privacy breaches or other unauthorized or improper access to, use of, or destruction of personal data, we may face costs, significant liabilities, harm to our brand and business disruption.
● If we do not comply with laws regulating the dateprotection of the Purchase Agreement,environment and health and human safety, our business could be adversely affected.
Risks Associated to allowour Common Stock
● Our common stock is a “Penny Stock” subject to specific rules governing its sale to investors that could impact its liquidity.
● There is no recent trading activity in our common stock and there is no assurance that an active market will develop in the selling stockholdersfuture.
● Our ability to participatelist on Nasdaq will require raising significant capital; failure to qualify to trade on Nasdaq will make it more difficult to raise capital.
● The market price of our common stock may be volatile, which could lead to losses by investors and costly securities litigation.
● If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or detect fraud. Consequently, investors could lose confidence in future financing transactions;our financial reporting and (iv) to hold a shareholder meeting by August 15, 2011 to approve, among other matters,this may decrease the trading price of our stock.
● Investors may experience dilution of their ownership interests because of the future issuance of greater than 19.99% of our shares of common stock pursuant to the Notes and upon exercise of the Warrants and to approve any change of control and/or other matter requiring approval which results from the issuance of our shares of common stock pursuant to the Notes and upon exercise of the Warrants. The Company intends to hold its shareholder meeting as promptly as practicable.
● Our common stock is controlled by insiders.
● We willdo not receive anyintend to pay dividends for the foreseeable future and may never pay dividends.
Our certificate of incorporation allows for our board to create new series of preferred stock without further approval by our stockholders, which could adversely affect the rights of the proceeds fromholders of our common stock.
Corporate Information
We are a Delaware corporation with one subsidiary, Protagenic Therapeutics Canada (2006) Inc., a corporation formed in 2006 under the salelaws of the Province of Ontario, Canada. Our principal offices are located at 149 Fifth Avenue, New York, New York 10010. Our telephone number is (212) 994-8200. The inclusion of our website address does not include or incorporate by reference into this prospectus supplement or the accompanying prospectus any information on, or accessible through, our website. Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, together with amendments to these reports, are available on the “Investor Relations” section of our website, free of charge, as soon as reasonably practicable after such material is electronically filed with, or furnished to, the U.S. Securities and Exchange Commission (“SEC”).
The Securities We May Offer
We may offer shares of our common stock offered byand preferred stock, depositary shares representing a fractional interest in a share of preferred stock, various series of debt securities, rights, warrants to purchase any of such securities, and/or units either individually or in combination with other securities, with a total value of up to $100,000,000 from time to time under this prospectus, together with the selling stockholders pursuantapplicable prospectus supplement and any related free writing prospectus, at prices and on terms to this prospectus. On September 29, 2011, we had 6,330,778 sharesbe determined at the time of ourany offering. We may also offer common stock, outstanding, which excludes 681,509 shares held in treasury.preferred stock and/or debt securities upon the exercise of the rights or warrants. This prospectus provides you with a general description of the securities we may offer. Each time we offer a type or series of securities under this prospectus, we will provide a prospectus supplement that will describe the specific amounts, prices and other important terms of the securities, including.
Investing in our common stocksecurities involves risk. The prospectus supplement applicable to a high degreeparticular offering of risk. Yousecurities will contain a discussion of the risks applicable to an investment in Protagenic and to the particular types of securities that we are offering under that prospectus supplement. Before making an investment decision, you should carefully consider the following risk factorsrisks described under “Risk Factors” in the applicable prospectus supplement and the risks described in our most recent Annual Report on Form 10-K for the year ended December 31, 2020, as amended from time to time, which is incorporated herein by reference, or any updates in our Quarterly Reports on Form 10-Q, together with all of the other information containedappearing in or incorporated by reference into this report before purchasing our common stock. The risksprospectus and uncertainties described below are not the only ones facing us. Additional risksany applicable prospectus supplement, in light of your particular investment objectives and uncertainties that management is unaware of, or that it currently deems immaterial, also may become important factors that affect us. If any of the following risks occur, ourfinancial circumstances. Our business, financial condition cash flows and/or results of operations could be materially and adversely affected. In that case, theaffected by any of these risks. The trading price of our common stocksecurities could decline due to any of these risks, and stockholders are at risk of losing some or all of the money invested in purchasing our common stock.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains “forward-looking statements” within the meaning of which may harm our business and operations.
Factors or events that could cause our actual results to differ may emerge from time to time, and it is not put undue reliance on any forward-looking statements.possible for us to predict all of them. We assume no obligationcannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to reflectconform these statements to actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking statements, no inference should be drawnresults.
DIVIDEND POLICY
We have never paid any cash dividends on our common stock. We anticipate that we will make additional updates with respectretain funds and future earnings to thosesupport operations and to finance the growth and development of our business. Therefore, we do not expect to pay cash dividends in the foreseeable future following this offering, if at all. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements and other factors that our board of directors deems relevant. In addition, the terms of any future debt or other forward-looking statements.credit financings may preclude us from paying dividends.
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Except as otherwise provided in the applicable prospectus supplement, we intend to use the net proceeds from the sale of sharesthe securities covered by this prospectus for general corporate purposes, which may include, but is not limited to, working capital, capital expenditures, research and development clinical trial expenditures, acquisitions of additional companies or technologies and investments. We may temporarily invest the net proceeds in investment-grade, interest-bearing securities until they are used for their stated purpose. We have not determined the amount of net proceeds to be offered byused specifically for such purposes. As a result, management will retain broad discretion over the selling stockholders. allocation of net proceeds.
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The proceeds fromfollowing is a description of our Common Stock, $0.0001 par value (the “Common Stock”) and Preferred Stock, $0.000001 par value (the “Preferred Stock”). The Common Stock is the sale of each selling stockholder’s common stock will belong to that selling stockholder.
General. We are authorized to issue is 120,000,000 shares of all classes of capital stock, of which 100,000,000 shares are Common Stock, $0.001 par value per share, and 20,000,000 shares are Preferred Stock, $0.000001 par value per share. Our capital is stated in U.S. dollars. As of May 14, 2021, we had 14,643,780 outstanding shares of Common Stock.
Common Stock
Voting. The holders of our common stock are entitled to one vote for each share held of record on all matters on which the rulesholders are entitled to vote (or consent pursuant to written consent).
Dividends. The holders of our common stock are entitled to receive, ratably, dividends only if, when and regulations thereunder)as declared by our board of directors out of funds legally available therefor and after provision is made for each class of capital stock having preference over the common stock. We have never declared or paid dividends. We do not intend to pay cash dividends on our common stock for the foreseeable future, but currently intend to retain any future earnings to fund the development and growth of our business. The payment of dividends if any, on our common stock will rest solely within the discretion of our board of directors and will depend, among other things, upon our earnings, capital requirements, financial condition, and other relevant factors.
Liquidation Rights. In the event of our liquidation, dissolution or winding-up, the holders of our common stock are entitled to share, ratably, in all assets remaining available for distribution after payment of all liabilities and after provision is made for each class of capital stock having preference over the common stock.
Conversion Rights. The holders of our common stock have no conversion rights.
Preemptive and Similar Rights. The holders of our common stock have no preemptive or similar rights.
Redemption/Put Rights. There are no redemption or sinking fund provisions applicable to the common stock. All of the outstanding shares of our common stock are fully-paid and non-assessable.
Anti-Takeover Effect of Delaware Law, Certain Charter and Bylaw Provisions
In addition to the provisions included in our Third Amended and Restated Certificate of Incorporation and Bylaws, we are subject to the provisions of Section 203 of the General Corporation Law of the State of Delaware, an anti-takeover law. In general, Section 203 prohibits a publicly held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in the following prescribed manner:
| ● | prior to the time of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; | |
| ● | upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding (1) shares owned by persons who are directors and also officers and (2) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; and | |
| ● | on or subsequent to the time of the transaction, the business combination is approved by the board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder. |
Generally, for purposes of Section 203, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An “interested stockholder” is a person who, together with affiliates and associates, owns or, within three years prior to the determination of interested stockholder status, owned 15% or more of a corporation’s outstanding voting securities.
Transfer Agent and Registrar
American Stock Transfer & Trust Company, LLC is the transfer agent and registrar for our common stock.
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Preferred Stock
Under the terms of our Third Amended and Restated Certificate of Incorporation, our board of directors have the authority, without further action by our stockholders, to issue up to 20,000,000 shares of Preferred Stock in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of commoneach wholly unissued series and any qualifications, limitations or restrictions thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding. The powers, preferences and relative, participating, optional and other special rights of each series of Preferred Stock, and the qualifications, limitations or restrictions thereof, if any, may differ from those of any and all other series at any time outstanding.
Our board of directors may authorize the issuance of Preferred Stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of our Common Stock. The purpose of authorizing our board of directors to issue Preferred Stock and determine its rights and preferences is to eliminate delays associated with a stockholder vote on specific issuances. The issuance of Preferred Stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in control of us and may adversely affect the market price of our Common Stock and the voting and other rights of the holders of our Common Stock. It is not possible to state the actual effect of the issuance of any shares of Preferred Stock on the rights of holders of Common Stock until the board of directors determines the specific rights attached to that Preferred Stock.
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DESCRIPTION OF DEPOSITARY SHARES
We may offer depositary shares, which will be evidenced by depositary receipts, representing fractional interests in shares of preferred stock of any series. In connection with the issuance of any depositary shares, we will enter into a deposit agreement with a bank or trust company, as depositary, which will be named in the applicable prospectus supplement. The following briefly summarizes the material provisions of the deposit agreement and of the depositary shares and depositary receipts, other than pricing and related terms disclosed for a particular issuance in an accompanying prospectus supplement. This description is not complete and is subject to, and qualified in its entirety by reference to, all provisions of the deposit agreement, depositary shares and depositary receipts. You should read the particular terms of any depositary shares and any depositary receipts that we offer and any deposit agreement relating to a particular series of preferred stock described in more detail in a prospectus supplement. The prospectus supplement will also state whether any of the generalized provisions summarized below do not apply to the depositary shares or depositary receipts being offered.
General
We may, at our option, elect to offer fractional shares of preferred stock, rather than full shares of preferred stock. In such event, we will issue receipts for depositary shares, each of which will represent a fraction of a share of a particular series of preferred stock. For a description of our preferred stock, see “Description of Capital Stock–Preferred Stock.”
The shares of any series of preferred stock represented by depositary shares will be deposited under a deposit agreement between us and the depositary we select. Each owner of a depositary share will be entitled to all the rights and preferences of the underlying preferred stock, including any dividend, voting, redemption, conversion and liquidation rights described in the particular prospectus supplement, in proportion to the applicable fraction of a share of preferred stock represented by such depositary share.
The depositary shares will be evidenced by depositary receipts issued pursuant to the deposit agreement. Depositary receipts will be distributed to those persons purchasing the fractional shares of preferred stock in accordance with the terms of the applicable prospectus supplement.
Dividends and Other Distributions
The preferred stock depositary will distribute all cash dividends or other cash distributions, if any, received in respect of the deposited preferred stock to the record holders of depositary shares relating to the preferred stock in proportion to the number of depositary shares owned by such holders on the relevant record date.
In the case of a distribution other than in cash, the preferred stock depositary will distribute any property received by it other than cash to the record holders of depositary shares entitled to receive it in proportion to the number of depositary shares owned by such holder. If the preferred stock depositary determines that it is not feasible to make such a distribution, it may, with our approval, sell the property and distribute the net proceeds from the sale to the holders of the depositary shares.
The amounts distributed in any such distribution, whether in cash or otherwise, will be reduced by any amount required to be withheld by us or the preferred stock depositary on account of taxes.
Withdrawal of Preferred Stock
Unless otherwise indicated in the applicable prospectus supplement and unless the related depositary shares have been called for redemption, when a holder surrenders depositary receipts at the office of the preferred stock depositary maintained for that purpose, and pays any necessary taxes, charges or other fees, the holder will be entitled to receive the number of whole shares of the related series of preferred stock, and any money or other property, if any, represented by the holder’s depositary shares. Once a holder exchanges depositary shares for whole shares of preferred stock, that holder generally cannot “re-deposit” these shares of preferred stock with the preferred stock depositary, or exchange them for depositary shares. If a holder delivers depositary receipts that represent a number of depositary shares other than a whole number of shares of preferred stock for redemption or exchange, the preferred stock depositary will issue a new depositary receipt to the holder that evidences the remainder of depositary shares at the same time that the preferred stock is withdrawn.
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Redemption, Conversion and Exchange of Preferred Stock
If a series of preferred stock represented by depositary shares is to be redeemed, the depositary shares will be redeemed from the proceeds received by the preferred stock depositary resulting from the redemption, in whole or in part, of that series of preferred stock. The depositary shares will be redeemed by the preferred stock depositary at a price per depositary share equal to the applicable fraction of the redemption price per share payable in respect of the shares of preferred stock redeemed.
Whenever we redeem shares of preferred stock held by eachthe preferred stock depositary, the preferred stock depositary will redeem, as of the selling stockholders.same date, the number of depositary shares representing shares of preferred stock redeemed. If fewer than all the depositary shares are to be redeemed, the depositary shares to be redeemed will be selected by the preferred stock depositary by lot or ratably or by any other equitable method, in each case as we may determine.
If a series of preferred stock represented by depositary shares is to be converted or exchanged, the holder of depositary receipts representing the shares of preferred stock being converted or exchanged will have the right or obligation to convert or exchange the depositary shares evidenced by the depositary receipts.
After the redemption, conversion or exchange date, the depositary shares called for redemption, conversion or exchange will no longer be outstanding. When the depositary shares are no longer outstanding, all rights of the holders will end, except the right to receive money, securities or other property payable upon redemption, conversion or exchange.
Voting Deposited Preferred Stock
Upon receipt of notice of any meeting at which the holders of any series of deposited preferred stock are entitled to vote, the preferred stock depositary will mail the information contained in the notice of meeting to the record holders of the depositary receipts evidencing the depositary shares relating to that series of preferred stock. Each record holder of the depositary receipts on the record date will be entitled to instruct the preferred stock depositary to vote the amount of the preferred stock represented by the holder’s depositary shares. The second column listspreferred stock depositary will try, if practical, to vote the amount of such series of preferred stock represented by such depositary shares in accordance with such instructions.
We will agree to take all reasonable actions that the preferred stock depositary determines are necessary to enable the preferred stock depositary to vote as instructed. The preferred stock depositary will abstain from voting shares of any series of preferred stock held by it for which it does not receive specific instructions from the holders of depositary shares representing those preferred shares.
Amendment and Termination of the Deposit Agreement
The form of depositary receipt evidencing the depositary shares and any provision of the deposit agreement may at any time be amended by agreement between us and the preferred stock depositary. However, any amendment that materially and adversely alters any existing right of the holders of depositary receipts will not be effective unless the amendment has been approved by the holders of depositary receipts representing at least a majority of the depositary shares then outstanding. Additionally, in the case of amendments relating to or affecting rights to receive dividends or distributions or voting or redemption rights, approval is also required by the holders of depositary receipts representing not less than a specified percentage or all of the depositary shares of such series or class then outstanding, as provided in the applicable prospectus supplement. Every holder of an outstanding depositary receipt at the time any such amendment becomes effective will be deemed, by continuing to hold the depositary receipt, to consent and agree to the amendment and to be bound by the deposit agreement, as amended.
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We may direct the preferred stock depositary to terminate the deposit agreement at any time by mailing notice of termination to the record holders of the depositary receipts then outstanding at least 30 days prior to the date fixed for termination. Upon termination, the preferred stock depositary will deliver to each holder of depositary receipts, upon surrender of those receipts, such number of whole shares of the series of preferred stock represented by the depositary shares together with cash in lieu of any fractional shares, to the extent we have deposited cash for payment in lieu of fractional shares with the preferred stock depositary. In addition, the deposit agreement will automatically terminate if:
| ● | all of the outstanding shares of the preferred stock deposited with the preferred stock depositary have been withdrawn, redeemed, converted or exchanged; or | |
| ● | there has been a final distribution in respect of the deposited preferred stock in connection with our liquidation, dissolution or winding up and the distribution has been made to the holders of the related depositary shares evidenced by depositary receipts. |
Charges of Preferred Stock Depositary; Taxes and Other Governmental Charges
We will pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. We also will pay charges of the preferred stock depositary in connection with the initial deposit of preferred stock and any redemption of preferred stock. Holders of depositary receipts will pay other transfer and other taxes and governmental charges and such other charges, including a fee for the withdrawal of shares of preferred stock upon surrender of depositary receipts, as are expressly provided in the deposit agreement to be for their accounts.
Prospective purchasers of depositary shares should be aware that special tax, accounting and other issues may be applicable to instruments such as depositary shares.
Resignation and Removal of Depositary
The preferred stock depositary may resign at any time by delivering to us notice of its intent to do so, and we may at any time remove the preferred stock depositary, any such resignation or removal to take effect upon the appointment of a successor preferred stock depositary meeting the requirements specified in the deposit agreement and its acceptance of such appointment.
Miscellaneous
The preferred stock depositary will forward all reports and communications from us which are delivered to the preferred stock depositary and which we are required to furnish to the holders of the deposited preferred stock.
Neither we nor the preferred stock depositary will be liable if we are or the preferred stock depositary is prevented or delayed by law or any circumstances beyond our or its control in performing our or its obligations under the deposit agreement. Our obligations and the obligations of the preferred stock depositary under the deposit agreement will be limited to performance in good faith of the duties under the deposit agreement, and we and the preferred stock depositary will not be obligated to prosecute or defend any legal proceeding in respect of any depositary shares, depositary receipts or shares of preferred stock unless satisfactory indemnity is furnished. We and the preferred stock depositary may rely upon written advice of counsel or accountants, or upon information provided by holders of depositary receipts or other persons believed to be competent and on documents believed to be genuine.
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DESCRIPTION OF DEBT SECURITIES
We may issue debt securities from time to time, in one or more series, as either senior or subordinated debt or as senior or subordinated convertible debt. While the terms we have summarized below will apply generally to any debt securities that we may offer under this prospectus, we will describe the particular terms of any debt securities that we may offer in more detail in the applicable prospectus supplement. The terms of any debt securities offered under a prospectus supplement may differ from the terms described below. Unless the context requires otherwise, whenever we refer to the indenture, we also are referring to any supplemental indentures that specify the terms of a particular series of debt securities.
We will issue the debt securities under the indenture that we will enter into with the trustee named in the indenture. The indenture will be qualified under the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”). We have filed the form of indenture as an exhibit to the Registration Statement of which this prospectus is a part, and supplemental indentures and forms of debt securities containing the terms of the debt securities being offered will be filed as exhibits to the Registration Statement of which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC.
The following summary of material provisions of the debt securities and the indenture is subject to, and qualified in its entirety by reference to, all of the provisions of the indenture applicable to a particular series of debt securities. We urge you to read the applicable prospectus supplements and any related free writing prospectuses related to the debt securities that we may offer under this prospectus, as well as the complete indenture that contains the terms of the debt securities.
General
The indenture does not limit the amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal amount that we may authorize and may be in any currency or currency unit that we may designate. Except for the limitations on consolidation, merger and sale of all or substantially all of our assets contained in the indenture, the terms of the indenture do not contain any covenants or other provisions designed to give holders of any debt securities protection against changes in our operations, financial condition or transactions involving us.
We may issue the debt securities issued under the indenture as “discount securities,” which means they may be sold at a discount below their stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be issued with OID for U.S. federal income tax purposes because of interest payment and other characteristics or terms of the debt securities. Material U.S. federal income tax considerations applicable to debt securities issued with OID will be described in more detail in any applicable prospectus supplement.
We will describe in the applicable prospectus supplement the terms of the series of debt securities being offered, including:
| ● | the title of the series of debt securities; | |
| ● | any limit upon the aggregate principal amount that may be issued; | |
| ● | the maturity date or dates; | |
| ● | the form of the debt securities of the series; | |
| ● | the applicability of any guarantees; | |
| ● | whether or not the debt securities will be secured or unsecured, and the terms of any secured debt; | |
| ● | whether the debt securities rank as senior debt, senior subordinated debt, subordinated debt or any combination thereof, and the terms of any subordination; |
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| ● | if the price (expressed as a percentage of the aggregate principal amount thereof) at which such debt securities will be issued is a price other than the principal amount thereof, the portion of the principal amount thereof payable upon declaration of acceleration of the maturity thereof, or if applicable, the portion of the principal amount of such debt securities that is convertible into another security or the method by which any such portion shall be determined; | |
| ● | the interest rate or rates, which may be fixed or variable, or the method for determining the rate and the date interest will begin to accrue, the dates interest will be payable and the regular record dates for interest payment dates or the method for determining such dates; | |
| ● | our right, if any, to defer payment of interest and the maximum length of any such deferral period; | |
| ● | if applicable, the date or dates after which, or the period or periods during which, and the price or prices at which, we may, at our option, redeem the series of debt securities pursuant to any optional or provisional redemption provisions and the terms of those redemption provisions; | |
| ● | the date or dates, if any, on which, and the price or prices at which we are obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise, to redeem, or at the holder’s option to purchase, the series of debt securities and the currency or currency unit in which the debt securities are payable; | |
| ● | the denominations in which we will issue the series of debt securities, if other than denominations of $1,000 and any integral multiple thereof; | |
| ● | any and all terms, if applicable, relating to any auction or remarketing of the debt securities of that series and any security for our obligations with respect to such debt securities and any other terms which may be advisable in connection with the marketing of debt securities of that series; | |
| ● | whether the debt securities of the series shall be issued in whole or in part in the form of a global security or securities; the terms and conditions, if any, upon which such global security or securities may be exchanged in whole or in part for other individual securities; and the depositary for such global security or securities; | |
| ● | if applicable, the provisions relating to conversion or exchange of any debt securities of the series and the terms and conditions upon which such debt securities will be so convertible or exchangeable, including the conversion or exchange price, as applicable, or how it will be calculated and may be adjusted, any mandatory or optional (at our option or the holders’ option) conversion or exchange features, the applicable conversion or exchange period and the manner of settlement for any conversion or exchange; | |
| ● | if other than the full principal amount thereof, the portion of the principal amount of debt securities of the series which shall be payable upon declaration of acceleration of the maturity thereof; | |
| ● | additions to or changes in the covenants applicable to the particular debt securities being issued, including, among others, the consolidation, merger or sale covenant; | |
| ● | additions to or changes in the events of default with respect to the securities and any change in the right of the trustee or the holders to declare the principal, premium, if any, and interest, if any, with respect to such securities to be due and payable; | |
| ● | additions to or changes in or deletions of the provisions relating to covenant defeasance and legal defeasance; | |
| ● | additions to or changes in the provisions relating to satisfaction and discharge of the indenture; | |
| ● | additions to or changes in the provisions relating to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture; |
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| ● | the currency of payment of debt securities if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars; | |
| ● | whether interest will be payable in cash or additional debt securities at our or the holders’ option and the terms and conditions upon which the election may be made; | |
| ● | the terms and conditions, if any, upon which we will pay amounts in addition to the stated interest, premium, if any, and principal amounts of the debt securities of the series to any holder that is not a “United States person” for federal tax purposes; | |
| ● | any restrictions on transfer, sale or assignment of the debt securities of the series; and | |
| ● | any other specific terms, preferences, rights or limitations of, or restrictions on, the debt securities, any other additions or changes in the provisions of the indenture, and any terms that may be required by us or advisable under applicable laws or regulations. |
Conversion or Exchange Rights
We will set forth in the applicable prospectus supplement the terms on which a series of debt securities may be convertible into or exchangeable for our common stock or our other securities. We will include provisions as to settlement upon conversion or exchange and whether conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which the number of shares of our common stock or our other securities that the holders of the series of debt securities receive would be subject to adjustment.
Consolidation, Merger or Sale
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the indenture will not contain any covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise dispose of our assets as an entirety or substantially as an entirety. However, any successor to or acquirer of such assets (other than a subsidiary of ours) must assume all of our obligations under the indenture or the debt securities, as appropriate.
Events of Default Under the Indenture
Unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, the following are events of default under the indenture with respect to any series of debt securities that we may issue:
| ● | if we fail to pay any installment of interest on any series of debt securities, as and when the same shall become due and payable, and such default continues for a period of 90 days; provided, however, that a valid extension of an interest payment period by us in accordance with the terms of any indenture supplemental thereto shall not constitute a default in the payment of interest for this purpose; | |
| ● | if we fail to pay the principal of, or premium, if any, on any series of debt securities as and when the same shall become due and payable whether at maturity, upon redemption, by declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to such series; provided, however, that a valid extension of the maturity of such debt securities in accordance with the terms of any indenture supplemental thereto shall not constitute a default in the payment of principal or premium, if any; |
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| ● | if we fail to observe or perform any other covenant or agreement contained in the debt securities or the indenture, other than a covenant specifically relating to another series of debt securities, and our failure continues for 90 days after we receive written notice of such failure, requiring the same to be remedied and stating that such is a notice of default thereunder, from the trustee or holders of at least 25% in aggregate principal amount of the outstanding debt securities of the applicable series; and | |
| ● | if specified events of bankruptcy, insolvency or reorganization occur. |
If an event of default with respect to debt securities of any series occurs and is continuing, other than an event of default specified in the last bullet point above, the trustee or the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series, by notice to us in writing, and to the trustee if notice is given by such holders, may declare the unpaid principal of, premium, if any, and accrued interest, if any, due and payable immediately. If an event of default specified in the last bullet point above occurs with respect to us, the principal amount of and accrued interest, if any, of each issue of debt securities then outstanding shall be due and payable without any notice or other action on the part of the trustee or any holder.
The holders of a majority in principal amount of the outstanding debt securities of an affected series may waive any default or event of default with respect to the series and its consequences, except defaults or events of default regarding payment of principal, premium, if any, or interest, unless we have cured the default or event of default in accordance with the indenture. Any waiver shall cure the default or event of default.
Subject to the terms of the indenture, if an event of default under an indenture shall occur and be continuing, the trustee will be under no obligation to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable series of debt securities, unless such holders have offered the trustee reasonable indemnity. The holders of a majority in principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect to the debt securities of that series, provided that:
| ● | the direction so given by the holder is not in conflict with any law or the applicable indenture; and | |
| ● | subject to its duties under the Trust Indenture Act, the trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the holders not involved in the proceeding. |
A holder of the debt securities of any series will have the right to institute a proceeding under the indenture or to appoint a receiver or trustee, or to seek other remedies only if:
| ● | the holder has given written notice to the trustee of a continuing event of default with respect to that series; | |
| ● | the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that series have made written request; | |
| ● | such holders have offered to the trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred by the trustee in compliance with the request; and | |
| ● | the trustee does not institute the proceeding, and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series other conflicting directions within 90 days after the notice, request and offer. |
These limitations do not apply to a suit instituted by a holder of debt securities if we default in the payment of the principal, premium, if any, or interest on, the debt securities.
We will periodically file statements with the trustee regarding our compliance with specified covenants in the indenture.
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Modification of Indenture; Waiver
We and the trustee may change an indenture without the consent of any holders with respect to specific matters:
| ● | to cure any ambiguity, defect or inconsistency in the indenture or in the debt securities of any series; | |
| ● | to comply with the provisions described above under “Description of Debt Securities-Consolidation, Merger or Sale;” | |
| ● | to provide for uncertificated debt securities in addition to or in place of certificated debt securities; | |
| ● | to add to our covenants, restrictions, conditions or provisions such new covenants, restrictions, conditions or provisions for the benefit of the holders of all or any series of debt securities, to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants, restrictions, conditions or provisions an event of default or to surrender any right or power conferred upon us in the indenture; | |
| ● | to add to, delete from or revise the conditions, limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication and delivery of debt securities, as set forth in the indenture; | |
| ● | to make any change that does not adversely affect the interests of any holder of debt securities of any series in any material respect; | |
| ● | to provide for the issuance of and establish the form and terms and conditions of the debt securities of any series as provided above under “Description of Debt Securities-General” to establish the form of any certifications required to be furnished pursuant to the terms of the indenture or any series of debt securities, or to add to the rights of the holders of any series of debt securities; | |
| ● | to evidence and provide for the acceptance of appointment under any indenture by a successor trustee; or | |
| ● | to comply with any requirements of the SEC in connection with the qualification of any indenture under the Trust Indenture Act. |
In addition, under the indenture, the rights of holders of a series of debt securities may be changed by us and the trustee with the written consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each series that is affected. However, unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities, we and the trustee may make the following changes only with the consent of each holder of any outstanding debt securities affected:
| ● | extending the fixed maturity of any debt securities of any series; | |
| ● | reducing the principal amount, reducing the rate of or extending the time of payment of interest, or reducing any premium payable upon the redemption of any series of any debt securities; or | |
| ● | reducing the percentage of debt securities, the holders of which are required to consent to any amendment, supplement, modification or waiver. |
Discharge
Each indenture provides that we can elect to be discharged from our obligations with respect to one or more series of debt securities, except for specified obligations, including obligations to:
| ● | provide for payment; | |
| ● | register the transfer or exchange of debt securities of the series; |
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| ● | replace stolen, lost or mutilated debt securities of the series; | |
| ● | pay principal of and premium and interest on any debt securities of the series; | |
| ● | maintain paying agencies; | |
| ● | hold monies for payment in trust; | |
| ● | recover excess money held by the trustee; | |
| ● | compensate and indemnify the trustee; and | |
| ● | appoint any successor trustee. |
In order to exercise our rights to be discharged, we must deposit with the trustee money or government obligations sufficient to pay all the principal of, any premium, if any, and interest on, the debt securities of the series on the dates payments are due.
Form, Exchange and Transfer
We will issue the debt securities of each series only in fully registered form without coupons and, unless we provide otherwise in the applicable prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indenture provides that we may issue debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or on behalf of, The Depository Trust Company (“DTC”), or another depositary named by us and identified in the applicable prospectus supplement with respect to that series. To the extent the debt securities of a series are issued in global form and as book-entry, a description of terms relating to any book-entry securities will be set forth in the applicable prospectus supplement.
At the option of the holder, subject to the terms of the indenture and the limitations applicable to global securities described in the applicable prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject to the terms of the indenture and the limitations applicable to global securities set forth in the applicable prospectus supplement, holders of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of the security registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities that the holder presents for transfer or exchange, we will impose no service charge for any registration of transfer or exchange, but we may require payment of any taxes or other governmental charges.
We will name in the applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar, that we initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the designation of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required to maintain a transfer agent in each place of payment for the debt securities of each series.
If we elect to redeem the debt securities of any series, we will not be required to:
| ● | issue, register the transfer of, or exchange any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing of a notice of redemption of any debt securities that may be selected for redemption and ending at the close of business on the day of the mailing; or |
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| ● | register the transfer of or exchange any debt securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming in part. |
Information Concerning the Trustee
The trustee, other than during the occurrence and continuance of an event of default under an indenture, undertakes to perform only those duties as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the trustee must use the same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, the trustee is under no obligation to exercise any of the powers given it by the indenture at the request of any holder of debt securities unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it might incur.
Payment and Paying Agents
Unless we otherwise indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered at the close of business on the regular record date for the interest.
We will pay principal of and any premium and interest on the debt securities of a particular series at the office of the paying agents designated by us, except that unless we otherwise indicate in the applicable prospectus supplement, we will make interest payments by check that we will mail to the holder or by wire transfer to certain holders. Unless we otherwise indicate in the applicable prospectus supplement, we will designate the corporate trust office of the trustee as our sole paying agent for payments with respect to debt securities of each series. We will name in the applicable prospectus supplement any other paying agents that we initially designate for the debt securities of a particular series. We will maintain a paying agent in each place of payment for the debt securities of a particular series.
All money we pay to a paying agent or the trustee for the payment of the principal of or any premium or interest on any debt securities that remains unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid to us, and the holder of the debt security thereafter may look only to us for payment thereof.
Governing Law
The indenture and the debt securities will be governed by and construed in accordance with the internal laws of the State of New York, except to the extent that the Trust Indenture Act is applicable.
DESCRIPTION OF RIGHTS
The complete terms of the rights will be contained in the rights agreements we enter into with rights agents. These documents will be included or incorporated by reference as exhibits to the registration statement of which this prospectus is a part. You should read the rights agreements and any related documents. You also should read the prospectus supplement, which will contain additional information and which may update or change some of the information below.
This section describes the general terms of the rights to purchase common stock or other securities that we may offer to stockholders using this prospectus. Further terms of the rights will be stated in the applicable prospectus supplement (or applicable free writing prospectus). The following description and any description of the rights in a prospectus supplement (or applicable free writing prospectus) may not be complete and is subject to and qualified in its entirety by reference to the terms of any agreement relating to the rights.
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Rights may be issued independently or together with any other security and may or may not be transferable. As part of any rights offering, we may enter into a standby underwriting or other arrangement under which the underwriters or any other person would purchase any securities that are not purchased in such rights offering. If we issue rights, each series of rights will be issued under a separate rights agreement to be entered into between us and a bank or trust company, as rights agent, that will be named in the applicable prospectus supplement. Further terms of the rights will be stated in the applicable prospectus supplement. The rights agent will act solely as our agent and will not assume any obligation to any holders of rights certificates or beneficial owners of rights. The rights agreements and rights certificates will be filed with the SEC as an exhibit to the registration statement of which this prospectus is a part or as an exhibit to a filing incorporated by reference in the registration statement. See “Where You Can Find Additional Information” for information on how to obtain copies of the rights agreements and rights certificates.
The prospectus supplement relating to any rights we offer will describe the specific terms of the offering and the rights, including the record date for stockholders entitled to the rights distribution, the number of rights issued and the number of shares of common stock beneficially owned by the selling stockholders, based on their respective ownership of shares of common stock, notes and warrants, as of September 29, 2011, assuming conversion of the Notes andthat may be purchased upon exercise of the Warrants held by each such selling stockholder on that date but taking account of any limitations on conversion andrights, the exercise set forth therein.
In general, a right entitles the sum of (i) the maximumholder to purchase for cash a specific number of shares of common stock issuable upon conversion of the Notes and (ii) the maximum number of shares of common stock issuable uponor other securities at a specified exercise of the Warrants, in each case, determined as if the outstanding Notes and Warrants were converted or exercised (as the case may be) in full (without regardprice. The rights are normally issued to any limitations on conversion or exercise contained therein)stockholders as of a specific record date, may be exercised only for a limited period of time and become void following the trading day immediately preceding the dateexpiration of such period. If we determine to issue rights, we will accompany this registration statement was initially filedprospectus with the SEC. Because the conversion price of the Notes and a prospectus supplement that will describe, among other things:
| ● | the record date for stockholders entitled to receive the rights; | |
| ● | the number of shares of common stock or other securities that may be purchased upon exercise of each right; | |
| ● | the exercise price of the rights; | |
| ● | the terms for changes to or adjustments in the exercise price, if any; | |
| ● | whether the rights are transferable; | |
| ● | the period during which the rights may be exercised and when they will expire; | |
| ● | the steps required to exercise the rights; | |
| ● | whether the rights include “oversubscription rights” so that the holder may purchase more securities if other holders do not purchase their full allotments; | |
| ● | whether we intend to sell the shares of common stock or other securities that are not purchased in the rights offering to an underwriter or other purchaser under a contractual “standby” commitment or other arrangement; | |
| ● | our ability to withdraw or terminate the rights offering; | |
| ● | any material United States federal income tax consequences; and | |
| ● | other material terms, including terms relating to transferability, exchange, exercise or amendment of the rights. |
If fewer than all of the rights issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons other than stockholders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby arrangements, as described in the applicable prospectus supplement. After the close of business on the expiration date, all unexercised rights will become void.
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The following description, together with the additional information we may include in any applicable prospectus supplement and free writing prospectus, summarizes the material terms and provisions of the warrants that we may offer under this prospectus, which may consist of warrants to purchase common stock, preferred stock or debt securities and may be issued in one or more series. Warrants may be adjusted,offered independently or in combination with common stock, preferred stock or debt securities offered by any prospectus supplement. While the numberterms we have summarized below will apply generally to any warrants that we may offer under this prospectus, we will describe the particular terms of shares thatany series of warrants in more detail in the applicable prospectus supplement. The following description of warrants will actually be issued may be more or less thanapply to the number of shares beingwarrants offered by this prospectus.prospectus unless we provide otherwise in the applicable prospectus supplement. The fourth column assumes the saleapplicable prospectus supplement for a particular series of allwarrants may specify different or additional terms.
We have filed forms of the shares offered by the selling stockholders pursuant to this prospectus.
General
We will describe in the second column reflects these limitations. The selling stockholders may sell all, some or none of their shares in this offering. See “Plan of Distribution.”
| Name of Selling Stockholder | Number of Shares of Common Stock Owned Prior to Offering | Maximum Number of Shares of Common Stock to be Sold Pursuant to this Prospectus | Number of Shares of Common Stock Owned After Offering (1) | Percentage of Shares Beneficially Owned After Offering (1)(2) | ||||||||||||
| Iroquois Master Fund Ltd. | 326,191 | (3) | 1,410,561 | (3) | - | - | ||||||||||
| Brilliant Digital Entertainment, Inc. | 1,314,350 | (4) | 2,256,898 | (4) | 1,040,357 | 8.0 | % | |||||||||
| Hudson Bay Master Fund Ltd. | 326,191 | (5) | 1,128,449 | (5) | - | - | ||||||||||
| Liballo Investment Limited | 326,191 | (6) | 564,227 | (6) | - | - | ||||||||||
| AYM Aggressive Value Fund | 282,113 | (7) | 282,113 | (7) | - | - | ||||||||||
| Kamran Hakim | 282,113 | (8) | 282,113 | (8) | - | - | ||||||||||
| Joseph Tuchman | 19,748 | (9) | 19,748 | (9) | - | - | ||||||||||
| Philip Dollman | 19,748 | (10) | 19,748 | (10) | - | - | ||||||||||
| the title of such securities; |
| ● | the offering price or prices and aggregate number of | |
| ● | the currency or currencies for |
| ● | if applicable, the | |
| ● | if applicable, the date on and after which the warrants and the related securities will be separately transferable; | |
| ● | if applicable, the minimum or maximum amount of such warrants which may be exercised at any one time; | |
| ● | in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one warrant and the price at which, and currency in which, this principal amount of debt securities may be purchased upon such exercise; | |
| ● | in the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the case may be, purchasable upon the exercise of one warrant and the price at which, and the currency in which, these shares may be purchased upon such exercise; | |
| ● | the effect of any merger, consolidation, sale or other disposition of our business on the warrant agreements and the warrants; |
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| ● | the terms of any rights to redeem or call the warrants; | |
| ● | the terms of any rights to force the exercise of the warrants; | |
| ● | any provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants; | |
| ● | the dates on which the right to exercise the warrants will commence and expire; | |
| ● | the manner in which the warrant agreements and warrants may be modified; | |
| ● | a discussion of any material or special U.S. federal income tax consequences of holding or exercising the warrants; | |
| ● | the terms of the securities issuable upon exercise of the warrants; and | |
| ● | any other specific terms, preferences, rights or limitations of or restrictions on the warrants. | |
| ● | Before exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such exercise, including: | |
| ● | in the case of warrants to purchase debt securities, the right to receive payments of principal of, or premium, if any, or interest on, the debt securities purchasable upon exercise or to enforce covenants in the applicable indenture; or | |
| ● | in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or, payments upon our liquidation, dissolution or winding up or to exercise voting rights, if any. |
Exercise of common stock issuableWarrants
Each warrant will entitle the holder to purchase the securities that we specify in the applicable prospectus supplement at the exercise price that we describe in the applicable prospectus supplement. The warrants may be exercised as set forth in the prospectus supplement relating to the warrants offered. Unless we otherwise specify in the applicable prospectus supplement, the warrants may be exercised at any time up to the specified time on the expiration date that we set forth in the applicable prospectus supplement relating to the warrants offered thereby. After the close of business on the expiration date, unexercised warrants will become void.
Upon receipt of payment and the warrant or warrant certificate, as applicable, properly completed and duly executed at the corporate trust office of the warrant agent, if any, or any other office indicated in the applicable prospectus supplement, we will, as soon as practicable, issue and deliver the securities purchasable upon conversionsuch exercise. If less than all of the warrants (or the warrants represented by such warrant certificate) are exercised, then we will issue a new warrant or warrant certificate, as applicable, for the remaining warrants.
Governing Law
Unless we otherwise specify in the applicable prospectus supplement, the warrants and any warrant agreements will be governed by and construed in accordance with the laws of the State of New York.
Enforceability of Rights By Holders of Warrants
Each warrant agent, if any, will act solely as our agent under the applicable warrant agreement and will not assume any obligation or relationship of agency or trust with any holder of any warrant. A single bank or trust company may act as warrant agent for more than one issue of warrants. A warrant agent will have no duty or responsibility in case of any default by us under the applicable warrant agreement or warrant, including any duty or responsibility to initiate any proceedings at law or otherwise, or to make any demand upon us. Any holder of a secured convertible note heldwarrant may, without the consent of the related warrant agent or the holder of any other warrant, enforce by IMF. Excludes (i) 147,947 shares of common stock issuable upon conversion of such note held by IMFappropriate legal action its right to exercise, and (ii) 936,423 shares of common stock issuablereceive the securities purchasable upon exercise of, warrantsits warrants.
DESCRIPTION OF UNITS
We may issue units comprised of one or more of the other securities described in this prospectus or in any prospectus supplement in any combination. Each unit will be issued so that the holder of the unit is also the holder, with the rights and obligations of a holder, of each security included in the unit. The unit agreement under which a unit is issued may provide that the securities included in the unit may not be held by IMF because such note contains, and eachor transferred separately, at any time or at any time before a specified date or upon the occurrence of a specified event or occurrence.
The applicable prospectus supplement relating to units offered under this prospectus will describe the following terms, where applicable, of such warrants contain, a “blocker provision”units:
| ● | the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately; | |
| ● | any unit agreement under which the units will be issued; | |
| ● | any provisions for the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; and | |
| ● | whether the units will be issued in fully registered or global form. |
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We may sell the holder thereof does not have the right to convert such note or exercise each such warrant to the extent (but only to the extent) that such conversion or exercise would result in beneficial ownership by the holder thereof, or any of its affiliates, of more than 4.9% of the common stock. Without such “blocker provisions,” Iroquois Capital, Mr. Silverman and Mr. Abbe would be deemed to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange Act of 1934, as amended) of 1,410,561 shares of common stock.
| Party | Payments in Cash | Other Payments | |||
| Iroquois Master Fund Ltd. | $ | 60,000 | None | ||
| ● | ||
| ● | the purchase price of the | |
| ● | any underwriting discounts and other items constituting underwriters’ compensation; | |
| ● | any discounts or |
| Market Price/Conversion Price | ||||||||||||||||||||||||
| $ | <2.90 | $ | 3.10 | $ | 3.30 | $ | 3.50 | $ | 3.70 | $ | 3.90 | |||||||||||||
| % Profit | 10 | % | 17.59 | % | 25.17 | % | 32.76 | % | 40.34 | % | 47.93 | % | ||||||||||||
| Total shares underlying converted notes | 2,004,655 | 2,004,655 | 2,004,655 | 2,004,655 | 2,004,655 | 2,004,655 | ||||||||||||||||||
| Total Market Price of Shares Underlying Convertible Notes | $ | 5,813,500 | $ | 6,214,431 | $ | 6,615,362 | $ | 7,016,293 | $ | 7,417,224 | $ | 7,818,155 | ||||||||||||
| Total Conversion Price of Shares Underlying Convertible Notes | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | ||||||||||||
| Total Profit on Sale of Shares | $ | 0 | $ | 400,931 | $ | 801,862 | $ | 1,202,793 | $ | 1,603,724 | $ | 2,004,655 | ||||||||||||
| Original Issue Discount on Notes Profit | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | ||||||||||||
| Total Profit | $ | 528,500 | $ | 929,431 | $ | 1,330,362 | $ | 1,731,293 | $ | 2,132,224 | $ | 2,533,155 | ||||||||||||
| Market Price | $ | 2.50 | $ | 2.70 | $ | 2.90 | $ | 3.10 | $ | 3.30 | $ | 3.41 | ||||||||||||
| Conversion Price | $ | 2.13 | $ | 2.30 | $ | 2.47 | $ | 2.64 | $ | 2.81 | $ | 2.90 | ||||||||||||
| % Profit | 29.4 | % | 29.4 | % | 29.4 | % | 29.4 | % | 29.4 | % | 29.4 | % | ||||||||||||
| Total shares underlying converted notes | 2,735,765 | 2,533,116 | 2,358,418 | 2,206,262 | 2,072,550 | 2,005,693 | ||||||||||||||||||
| Total Market Price of Shares Underlying Convertible Notes | $ | 6,839,413 | $ | 6,839,413 | $ | 6,839,412 | $ | 6,839,412 | $ | 6,839,415 | $ | 6,839,413 | ||||||||||||
| Total Conversion Price of Shares Underlying Convertible Notes | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | $ | 5,813,500 | ||||||||||||
| Total Profit on Sale of Shares or Total Discount to Market Price | $ | 1,025,912 | $ | 1,025,913 | $ | 1,025,912 | $ | 1,025,912 | $ | 1,025,915 | $ | 1,025,913 | ||||||||||||
| Original Issue Discount on Notes Profit | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | $ | 528,500 | ||||||||||||
| Total Profit | $ | 1,554,412 | $ | 1,554,412 | $ | 1,554,412 | $ | 1,554,412 | $ | 1,554,412 | $ | 1,554,412 |
| Gross Proceeds to Company as a result of Transaction | $ | 5,285,000 | ||
Required Payments (made or to be made in connection with the financing)(1) | $ | 450,850 | ||
| Resulting Net Proceeds to Issuer | $ | 4,834,150 | ||
| Total possible profit resulting from conversion discount upon Company conversion with a market price of approximately $3.41 or less (above $3.41, there is no conversion discount). | $ | 1,554,412 |
| ● | any |
We may distribute the total amount of all possible payments ($450,850) and the total possible discount to the market price of the shares underlying the convertible notes ($1,554,412)(assuming a Company conversion at a market price of $2.90 per share and including the original issue discount profit) divided by the gross proceeds to the issuer from the sale of the convertible notes ($5,285,000) is 37.9%, or 3.2% per month that the notes are outstanding based on the 12 month period of the notes.
| ● | a fixed price or prices, which may be changed; | |
| ● | market prices prevailing at the time of sale; | |
| ● | prices related to such prevailing market prices; or | |
| ● | negotiated prices. |
Only underwriters named in the prospectus supplement are underwriters of the securities offered by the prospectus supplement.
If underwriters are used in an offering, we will execute an underwriting agreement with such underwriters and will specify the name of each underwriter and the terms of the transaction (including any underwriting discounts and other terms constituting compensation of the underwriters and any dealers) in a prospectus supplement. The securities may be offered to the public either through underwriting syndicates represented by managing underwriters or directly by one or more investment banking firms or others, as designated. If an underwriting syndicate is used, the managing underwriter(s) will be specified on the cover of the prospectus supplement. If underwriters are used in the sale, the offered securities will be acquired by the underwriters for their own accounts and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of salesale. Any public offering price and any discounts or at negotiated prices. These salesconcessions allowed or re-allowed or paid to dealers may be effectedchanged from time to time. Unless otherwise set forth in transactions, whichthe prospectus supplement, the obligations of the underwriters to purchase the offered securities will be subject to conditions precedent, and the underwriters will be obligated to purchase all of the offered securities, if any are purchased.
We may involve crossesgrant to the underwriters options to purchase additional securities to cover over-allotments, if any, at the public offering price, with additional underwriting commissions or block transactions,discounts, as may be set forth in a related prospectus supplement. The terms of any over-allotment option will be set forth in the prospectus supplement for those securities.
| -23- |
If we use a dealer in the sale of the securities being offered pursuant to onethis prospectus or moreany prospectus supplement, we will sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale. The names of the following methods:
We may also sell shares of common stock under Rule 144 promulgated under the Securities Act of 1933, as amended, if available, rather than under this prospectus. In addition, the selling stockholders may transfer the shares of common stock by other means not described in this prospectus. If the selling stockholders effect such transactions by selling shares of common stock tosecurities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement.
We may authorize agents or underwriters broker-dealers or agents, suchto solicit offers by institutional investors to purchase securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. We will describe the conditions to these contracts and the commissions we must pay for solicitation of these contracts in the prospectus supplement.
In connection with the sale of the securities, underwriters, broker-dealersdealers or agents may receive commissionscompensation from us or from purchasers of the securities for whom they act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions from the selling stockholdersunderwriters or commissions from purchasers of the shares of common stockpurchasers for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers oragents. Underwriters, dealers and agents may be in excess of those customary in the types of transactions involved). In connection with sales of the shares of common stock or otherwise, the selling stockholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the shares of common stock in the course of hedging in positions they assume. The selling stockholders may also sell shares of common stock short and deliver shares of common stock covered by this prospectus to close out short positions and to return borrowed shares in connection with such short sales. The selling stockholders may also loan or pledge shares of common stock to broker-dealers that in turn may sell such shares.
We may provide agents, underwriters and other purchasers with indemnification against particular civil liabilities, including liabilities under the Securities Act, or contribution with respect to payments that the agents, underwriters or other purchasers may make with respect to such liabilities. Agents and underwriters may engage in transactions with, or perform services for, us in the ordinary course of business.
To facilitate the public offering of a series of securities, persons participating in the offering may engage in transactions that stabilize, maintain, or otherwise affect the market price of the securities. This may include over-allotments or short sales of the securities, which involves the sale by persons participating in the offering of more securities than have been sold to them by us. In exercising the over-allotment option granted to those persons. In addition, those persons may stabilize or maintain the price of the securities by bidding for or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to underwriters or dealers participating in any such offering may be reclaimed if securities sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market. Such transactions, if commenced, may be discontinued at any time. We make no representation or prediction as to the direction or magnitude of any effect that the transactions described above, if implemented, may have on the price of our securities.
Unless otherwise specified in the applicable prospectus supplement, any common stock is made,sold pursuant to a prospectus supplement if required, will be distributed, whicheligible for trading on Nasdaq Capital Market. Any underwriters to whom securities are sold by us for public offering and sale may make a market in the securities, but such underwriters will set forthnot be obligated to do so and may discontinue any market making at any time without notice.
We may engage in at the aggregate amountmarket offerings into an existing trading market in accordance with Rule 415(a)(4) under the Securities Act. In addition, we may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of sharesstock, and they may use securities received from us in settlement of common stock being offeredthose derivatives to close out any related open borrowings of stock. The third party in these sale transactions will be an underwriter and will be identified in the applicable prospectus supplement. In addition, we may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus. The financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities.
We will file a prospectus supplement to describe the terms of any offering of our securities covered by this prospectus. The prospectus supplement will disclose:
| ● | the purchase price of the securities from us; | |
| ● | the net proceeds to us from the sale of the securities; | |
| ● | any delayed delivery arrangements; | |
| ● | any over-allotment or other options under which underwriters, if any, may purchase additional securities from us; | |
| ● | any underwriting discounts, commissions or other items constituting underwriters’ compensation, and any commissions paid to agents; | |
| ● | in a subscription rights offering, whether we have engaged dealer-managers to facilitate the offering or subscription, including their name or names and compensation; | |
| ● | any public offering price; and | |
| ● | other facts material to the transaction. |
We will bear all or substantially all of the offering, includingcosts, expenses and fees in connection with the nameregistration of our securities under this prospectus. The underwriters, dealers and agents may engage in transactions with us, or namesperform services for us, in the ordinary course of any broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the selling stockholders and any discounts, commissions or concessions allowed or re-allowed or paidbusiness.
In order to broker-dealers.
| -24- |
Unless otherwise indicated in the distribution of the shares of common stock to engage in market-making activities with respect to the shares of common stock. All of the foregoing may affect the marketability of the shares of common stock and the ability of any person or entity to engage in market-making activities with respect to the shares of common stock.
Our financial statements of Atrinsic, Inc. as of December 31, 2010 and 2009 and for each of the years in the two-year period ended December 31, 2010, have been2020 and 2019 incorporated by reference in this Registration Statement, in reliance upon the reports of KPMGprospectus have been audited by MaloneBailey, LLP, independent registered public accounting firm, incorporated by reference elsewhere herein and are included in reliance on their report (the report on the financial statements contains an explanatory paragraph regarding the Company’s ability to continue as a going concern) given upon the authority of said firm as experts in accountingauditing and auditing.
LIMITATION ON LIABILITY AND DISCLOSURE OF COMMISSION POSITION ON Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. This prospectus and any subsequent prospectus supplements do not contain all of the information in the Registration Statement. We have omitted from this prospectus some parts of the Registration Statement as permitted by the rules and regulations of the SEC. Statements in this prospectus concerning any document we have filed as an exhibit to the Registration Statement or that we otherwise filed with the SEC are not intended to be comprehensive and are qualified in their entirety by reference to these filings. In addition, we file annual, quarterly and current reports, proxy statements and other information with the SEC. We have elected to We also incorporate by reference any future filings (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are related to such items unless such Form 8-K expressly provides to the Protagenic Therapeutics, Inc. 212-994-8200 Attention: Chief Financial Officer PROSPECTUS $ 100,000,000 Common Stock Preferred Stock Depositary Shares Debt Securities Rights Warrants Units PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 13. Other Expenses of Issuance and Distribution. The following table * Estimated expenses not presently known. Item 14. Indemnification of Directors and Officers. We are incorporated under the laws of the state of Delaware. Section 145 of the Delaware General Corporation Law Section 102(b)(7) of the Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for: These limitations of liability do not affect the availability of equitable remedies such as injunctive relief or rescission. Our charter also authorizes us to indemnify our officers, directors and other agents to the fullest extent permitted under Delaware law. As permitted by Section 145 of the Delaware General Corporation Law, our bylaws provide that: Section 174 of the Delaware General Corporation Law provides, among other things, that a director who willfully or negligently approves of an unlawful payment of dividends or an unlawful stock purchase or redemption may be held liable for such actions. A director who was either absent when the unlawful actions were Our Third Amended and Restated Certificate of Incorporation provides that no director shall be liable to us or our stockholders We have entered into Indemnification Agreements with the each of our directors and executive officers. Pursuant to our agreements, we will be We also have purchased directors and officer’s liability insurance in order to limit our exposure to liability of indemnification of directors and officers. The form of Underwriting Agreement, to be Item 15. Recent Sales of Unregistered Securities. Original Issuances of Stock and Warrants 2019-2020 Convertible Note Offering From November 21, 2019 through July 8, 2020, Protagenic Therapeutics, Inc. (the “Company”) entered into a Convertible Note Purchase Agreement (“Purchase Agreement”) with accredited investors (the “Investors”), pursuant to which the Company issued and sold unsecured convertible promissory notes (collectively, the “Notes”) to the Investors in On August 11, 2020, the Company notified investors in a On August 28, 2020, the “Company” entered into a Convertible Note Purchase Agreement with certain accredited investors, pursuant to which the Company issued and sold unsecured convertible promissory notes to the Investors in the aggregate principal amount of $427,500. For both sets of Notes, the Notes will be due on November 6, 2023 (the “Maturity Date”) and accrue simple interest at an annual rate of 6% on the aggregate unconverted and outstanding principal amount, payable annually, beginning October 31, 2020. The Notes have the same Maturity Date and interest rate as the set of convertible notes with an aggregate principal amount of $1,570,000 that the Company previously issued and reported in the Current Reports on Form 8-K filed respectively on November 21, 2019, December 4, 2019, December 23, 2019, January 29, 2020, March 3, 2020, May 14, 2020, and July 8, 2020. The Company will pay (a “PIK Payment”) the interest due by adding such interest (including interest at the Default Rate, as defined below, if any) to the then-outstanding principal amount of the Notes on each interest payment date and on the Maturity Date. Each PIK Payment will be preceded by written notice from the Company to each holder of the Notes setting forth in reasonable detail the amount of such PIK Payment and the principal amount of the Notes following such PIK Payment. The Notes will bear interest at the rate of 12% per year (the “Default Rate”) following a Default (as defined below). Holders may convert their Notes (including accrued interest) at their option, in whole or in part, at any time prior to the Maturity Date, at a conversion price (the “Conversion Price”) of $1.25 per share of the Company’s common stock, par value $0.0001 per share. The Conversion Price is subject to adjustment for any stock dividend, stock split, combination or other similar recapitalization event. On the Maturity Date, the Company is required to repay the Notes (including accrued interest) in their entirety in cash or, at its option, in shares of common stock at the Conversion Price. The Company may redeem for cash or shares of common stock all or any portion of the Notes, at its option, on or after November 5, 2021 if the last reported sale price of its common stock has been at least 120% of the Conversion Price then in Securities Act Exemptions We deemed the transactions described above were exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act, including Regulation D and Rule 506 promulgated thereunder, relative to transactions by an issuer not involving a public offering. All purchasers of securities in transactions exempt from registration pursuant to Regulation D represented to us that they were accredited investors and were acquiring the shares for investment purposes only and not with a view to, or for sale in connection with, any distribution thereof and that they could bear the risks of the investment and could hold the securities for an indefinite period of time. The purchasers received written disclosures that the securities had not been All certificates representing the securities issued in the transactions described in this Item 15 included appropriate legends setting forth that the securities had not been offered or sold pursuant to a registration statement and describing the applicable restrictions on transfer of Item 16. Exhibits. ** Filed herewith. Item 17. Undertakings. Pursuant to the requirements of the Securities Act of 1933, KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby severally constitutes and appoints Garo H. Armen and Alexander K. Arrow, and each of them singly, as such person’s true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for such person and in such person’s name, place and stead, in any and all capacities, to sign any and all amendments (including, without limitation, post-effective amendments) to this registration statement (or any registration statement for the same offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933), and to file the same, with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission, granting unto each said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that any said attorney-in-fact and agent, or any substitute or substitutes of any of them, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this June 4, 2021 June 4, 2021 June 4, 2021 June 4, 2021 June 4, 2021 June 4, 2021 June 4, 202134We have filed with theThe SEC a Registration Statement on Form S-3/A under the Securities Act with respect to the shares of common stock we are offering under this prospectus. This prospectus does not contain all of the information set forth in the Registration Statement and the exhibits to the Registration Statement. For further information with respect to us and the securities we are offering under this prospectus, we refer you to the Registration Statement and the exhibits and schedules filed as a part of the Registration Statement. You may read and copy the Registration Statement, as well as ourmaintains an Internet site that contains reports, proxy and information statements and other information that we file electronically with the SEC, including us. The SEC’s Internet site can be found at the SEC’s public reference room at 100 F Street, N.E., Room 1580, Washington, D.C. 20549-0102. You can requesthttp://www.sec.gov. In addition, we make available on or through our Internet site copies of these documents by writingreports as soon as reasonably practicable after we electronically file or furnished them to the SEC and paying a fee for the copying cost. You may obtain further information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.SEC. Our SEC filings are also available on the SEC Internet site can be found at www.sec.gov, which contains periodic reports and other information regarding issuers that file electronically.We also maintain a website at www.atrinsic.com, through which you can access our filings with the SEC. The information contained in, or accessible through, ourhttp:www.protagenic.com. Our website is not a part of this prospectus.-25- The SEC allows us“incorporateincorporate certain information by reference” informationreference into this prospectus, which means thatprospectus. By incorporating by reference, we can disclose important information to you by referring you to other documents that we have filed or will file with the SEC. We are incorporatingThe information incorporated by reference is deemed to be part of this prospectus, except for information incorporated by reference that is superseded by information contained in this prospectus. This means that you must look at all of the SEC filings that we incorporate by reference to determine if any statements in the prospectus or any document previously incorporated by reference have been modified or superseded. This prospectus incorporates by reference the information or documents set forth below that we have previously filed with the SEC (Commission File No. 000-50633):our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, which was filed on April 7, 2011 as amended on May 2, 2011;our Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, which was filed on May 16, 2011;our Quarterly Report on Form 10-Q for the quarter ended June 30, 2011, which was filed on August 15, 2011;our Current Report on Form 8-K filed July 1, 2011, which such report revised certain sections within our Annual Report on Form 10-K for the fiscal year ended December 31, 2010, to give retroactive effect to the change in reportable segments;our Current Reports on Form 8-K filed February 25, 2011; April 1, 2011 (as to information therein explicitly filed with the SEC only); April 20, 2011; April 26, 2011; June 1, 2011; June 6, 2011; July 12, 2011, August 22, 2011 and September 15, 2011 (to the extent that items contained in the preceding Current Reports on Form 8-K are furnished but not deemed “filed” for purposes of Section 18 ofunder the Securities Exchange Act of 1934, as amended (or otherwise subject(the “Exchange Act”):● our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities Exchange Commission on March 25, 2021; ● our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2021, filed with the Securities Exchange Commission on April 28, 2021; ● the description of our common stock set forth in the Registration Statement on Form 8-A12B filed with the Securities Exchange Commission on April 26, 2021, including any amendment or report filed for the purpose of updating such description. liabilities of Section 18), such items are not incorporated by reference);the description of our common stock contained in our registration statement on Form 10-SB filed with the SEC on June 10, 2005, including any amendments or reports filed for the purpose of updating such description, including any amendment or reports filed for the purpose of updating such description.35All future documents that we filecontrary) made with the SEC pursuant to SectionSections 13(a), 13(c), 14 or 15(d) of the Exchange Act, including those made after the date of the initial filing of the registration statement of which this prospectus is a part and prior to effectiveness of such registration statement, until we file a post-effective amendment that indicates the termination or completionof the offering of the securities made by this prospectus, which will become a part of this offering of common stock shallprospectus from the date that such documents are filed with the SEC. Information in such future filings updates and supplements the information provided in this prospectus. Any statements in any such future filings will automatically be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference in this prospectus and to be a part of it from the filing dates of such documents (except in each case the information contained in such documents to the extent “furnished” and not “filed”). Certainthat statements in and portions of this prospectus update andthe later-filed document modify or replace information in the above listed documents incorporated by reference. Likewise, statements in or portions of a future document incorporated by reference in this prospectus may update and replace statements in and portions of this prospectus or the above listed documents. To the extent there is a conflict between the information contained in this prospectus, on the one hand, and the information contained in any document incorporated by reference into this prospectus that was filed with the SEC before the date of this prospectus, on the other hand, you should rely on the information in this prospectus. If any statement in one of these documents is inconsistent with a statement in another document having a later date, the statement in the document having the later date modifies or supersedes thesuch earlier statement.providefurnish without charge to each person, including any beneficial owner, to whom a copy of this prospectus is delivered, upon written or oral request, of any such person, a copy of any or all of the documents incorporated by reference into this prospectus but not delivered with the prospectus, including exhibits that are specifically incorporated herein by reference. Requestsreference into such documents. You should be directeddirect any requests for documents to:Atrinsic, Inc.469 7th149 Fifth Avenue 10th Floor
New York, NY 10018New York 10010-26- Attn: Investor RelationsTable of Contents (212) 716-1977Table of Contents 36ITEM 14.itemizes thesets forth our costs and expenses incurred by the Registrant in connection with the offering.registration of our securities as described in this registration statement. All of the amounts shown are estimates except the SecuritiesCommission Registration Fee and Exchange Commission registrationthe FINRA filing fee. Amount Registration fee – Securities and Exchange Commission $ 2,367 Legal fees and expenses 150,000 Accounting fees and expenses 75,000 Miscellaneous expenses 5,000 Total $ 232,367 AMOUNT SEC registration fee $ 10,910 FINRA filing fee $ 15,500 Legal fees and expenses * Accounting fees and expenses * Transfer agent fees and expenses * Miscellaneous expenses * Total $ 26,410 ITEM 15.Theand certain provisionsprovides that a Delaware corporation may indemnify any persons who are, or are threatened to be made, parties to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of our certificate of incorporation and bylaws under certain circumstances provide for indemnification of our officers, directors and controlling persons against liabilities which they may incur in such capacities. A summarycorporation), by reason of the circumstances in whichfact that such indemnification is provided for is contained herein, but this description is qualified in its entirety by reference to our certificate of incorporation, bylaws and to the statutory provisions.In general, anyperson was an officer, director, employee or agent of such corporation, or is or was serving at the request of such person as an officer, director, employee or agent of another corporation or enterprise. The indemnity may be indemnified againstinclude expenses (including attorneys’ fees), judgments, fines settlements or judgments arisingand amounts paid in settlement actually and reasonably incurred by such person in connection with a legalsuch action, suit or proceeding, to whichprovided that such person is a party, if that person's actions wereacted in good faith wereand in a manner he or she reasonably believed to be in or not opposed to ourthe corporation’s best interests and, with respect to any criminal action or proceeding, such person had no reasonable cause to believe theirthat his or her conduct was illegal. A Delaware corporation may indemnify any persons who are, or are threatened to be made, a party to any threatened, pending or completed action or suit by or in the right of the corporation by reason of the fact that such person was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit provided such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him or her against the expenses that such officer or director has actually and reasonably incurred. Our charter and bylaws provide for the indemnification of our directors and officers to the fullest extent permitted under the Delaware General Corporation Law.● any breach of the director’s duty of loyalty to the corporation or its stockholders; ● any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; ● any act related to unlawful stock repurchases, redemptions or other distributions or payment of dividends; or ● any transaction from which the director derived an improper personal benefit. ● we may indemnify our directors, officers and employees to the fullest extent permitted by the Delaware General Corporation Law, subject to limited exceptions; ● we may advance expenses to our directors, officers and employees in connection with a legal proceeding to the fullest extent permitted by the Delaware General Corporation Law, subject to limited exceptions; and ● the rights provided in our bylaws are not exclusive. II-1 unlawful. Unlessapproved, or dissented at the time, may avoid liability by causing his or her dissent to such person is successful uponactions to be entered in the merits in such an action, indemnification may be awarded only after a determination by independent decisionbooks containing minutes of the meetings of the board of directors at the time such action occurred or a committee thereof, by legal counsel, or by a voteimmediately after such absent director receives notice of the unlawful acts.thatfor monetary damages for breach of fiduciary duty as a director to the applicable standard of conduct was metfullest extent permitted by the personDGCL.indemnified.The circumstances under which indemnification is granted in connection with an action brought onobligated, to the extent permitted by applicable law, to indemnify our behalf is generally the same as those set forth above; however, with respect to such actions, indemnification is granted only with respect todirectors and officers against all expenses, actuallyjudgments, fines and penalties incurred in connection with the defense or settlement of any actions brought against them by reason of the action. In such actions, unless the court determines otherwise, the personfact that they were our directors or officers or assumed certain responsibilities at our direction.indemnified must have actedfiled as Exhibit 1.1 hereto, provides for indemnification by the underwriters of us and our officers who sign this Registration Statement and directors for specified liabilities, including matters arising under the Securities Act.good faiththe aggregate principal amount of $1,570,000, as reported in Current Reports on Form 8-K filed on November 21, 2019, December 4, 2019, December 23, 2019, January 29, 2020, March 3, 2020, May 14, 2020, and July 8, 2020.manner believedconference call that it was re-opening the convertible note financing, with identical terms to the previous round, except for the closing date, which has now been set at Friday, August 21st, at 5:00 pm.II-2 our besteffect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which it provides notice of redemption. The redemption will be effected at a redemption price equal to 100% of the outstanding principal amount of the Notes to be redeemed, plus accrued and unpaid interest up to, but excluding, the redemption date. Any such redemption must be applied ratably among all Convertible Notes in proportion to their respective outstanding principal balances, plus accrued and haveunpaid interest. Other than pursuant to this redemption right, the Company may not pre-pay the Notes.adjudged liable toregistered under the corporation.Indemnification may alsoSecurities Act and that any resale must be granted pursuant to the terms of agreements which we have entered into and which may be entered into in the future ormade pursuant to a voteregistration statement or an available exemption from such registration.stockholders or directors. The statutory provision cited above also grants the power to us to purchase and maintain insurance which protects our officers and directors against any liabilities incurredsecurities. There were no underwriters employed in connection with their service in such a position, and such a policy may be obtained by us.A stockholder's investment may be adversely affected to the extent we pay the costs of settlement and damage awards against directors and officers as required by these indemnification provisions. At present, there is no pending litigation or proceeding involving any of our directors, officers or employees regarding which indemnification by us is sought, nor are we aware of any threatened litigation that may resultthe transactions set forth in claims for indemnification.
this Item 15ITEMExhibit
NumberDescription of Document 1.1* Form of Underwriting Agreement. 4.1* Form of warrant agreement and warrant certificate 4.2* Form of specimen preferred stock certificate 4.3* Certificate of designation for preferred stock 4.4** Form of with respect to senior debt securities, between the registrant and one or more trustees to be named. 4.5** Form of Indenture with respect to subordinated debt securities, between the registrant and one or more trustees to be named. 4.6* Form of debt security 4.7* Form of rights agreement 5.1** Opinion of Duane Morris LLP. 23.1** Consent of MaloneBailey, LLP, Independent Registered Public Accounting Firm. 23.2** Consent of Duane Morris LLP (included in Exhibit 5.1). 24.1** Powers of Attorney (included on signature page to this registration statement) The following exhibits are* To the extent applicable, to be filed herewith:by a post-effective amendment or as an exhibit to a document filed under the Exchange Act and incorporated by reference herein.II-4 ExhibitNumbera. The undersigned Registrant hereby undertakes: Exhibit Title1.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; 4.1ii. FormTo reflect in the prospectus any facts or events arising after the effective date of Senior Secured Convertible Note (1)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 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. 4.2iii. FormTo include any material information with respect to the plan of Series A Warrant (1)4.3Form of Series B Warrant (1)4.4Form of Series C Warrant (1)4.5Securities Purchase Agreement by and among Atrinsic, Inc. anddistribution not previously disclosed in the Buyers set forth on the signature pages thereto. (2)4.6Form of Registration Rights Agreement by and among Atrinsic, Inc. and the Buyers set forth on the signature pages thereto. (1)5.1Opinion of Stubbs, Alderton and Markiles, LLP.23.1Consent of Stubbs, Alderton & Markiles, LLP (included in Exhibit 5.1).23.2Consent of KPMG LLP.24.1Power of Attorney (3)(1)Incorporated by reference to our Current Report on Form 8-K filed on June 1, 2011.(2)Incorporated by reference to our Registration Statement on Form S-3/A filed on September 1, 2011.or any material change to such information in the registration statement;(3)Incorporated by reference to our Registration Statement on Form S-3 filed on July 1, 2011.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 Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent 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,Provided however, that paragraphs (a)(1)(i), (a)(1)(ii), and (a)(1)(iii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the CommissionSEC by the registrantRegistrant pursuant to Sectionsection 13 or Sectionsection 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, 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 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-5 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 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration statement or prospectus that is part of the Registration Statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the Registration Statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date. 5. That, for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: i. Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424; ii. Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant; iii. The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and iv. Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser. b. The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Exchange Act) that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. c. The undersigned registrant hereby undertakes to supplement the prospectus, after the expiration of the subscription period, to set forth the results of the subscription offer, the transactions by the underwriters during the subscription period, the amount of unsubscribed securities to be purchased by the underwriters, and the terms of any subsequent reoffering thereof. If any public offering by the underwriters is to be made on terms differing from those set forth on the cover page of the prospectus, a post-effective amendment will be filed to set forth the terms of such offering. d. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-2II-6 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 SIGNATURESoffering 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 purposes of determining liability under the Securities Act of 1933 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 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.5. (ii) Each prospectus filed pursuant to Rule 424(b) as part of this registration statement, shall be deemed to be part of and included in this registration statement as of the date it is first used after effectiveness; provided, however, that no statement made in this registration statement or prospectus that is part of this registration statement or made in a document incorporated or deemed incorporated by reference into this registration statement or prospectus that is part of this registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in this registration statement or prospectus that was part of this registration statement or made in any such document immediately prior to such date of first use.(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s 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 foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.II-3SIGNATURES as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3/AS-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on September 29, 2011. Atrinsic, Inc.PROTAGENIC THERAPEUTICS, INC. By: /s/ Stuart GoldfarbGaro H. Armen Name: Stuart GoldfarbGaro H. Armen Title: ChiefChairman (Principal Executive Officer(Principal Executive and Duly Authorized Officer)II-7 Registration Statementregistration statement has been signed by the following persons in the capacities and on the dates stated.NameSignature Title Date /s/ Stuart GoldfarbGaro H. Armen PresidentDirector and Chief ExecutiveChairman of the Board September 29, 2011Stuart GoldfarbGaro H. Armen Officer and Director /s/ Nathan FongAlexander K. Arrow Chief Financial Officer September 29, 2011Nathan FongAlexander K. Arrow Officer andPrincipal Accounting Officer) */s/ Robert B. Stein Director and Chief Medical Officer September 29, 2011Ray MusciRobert B. Stein */s/ Khalil Barrage Director September 29, 2011Lawrence BursteinKhalil Barrage */s/ Brian Corvese Director September 29, 2011Mark DyneBrian Corvese */s/ Jennifer Buell Director September 29, 2011Jerome A. ChazenJennifer Buell/s/ Joshua Silverman Director Joshua Silverman * By: /s/ Stuart GoldfarbStuart Goldfarb, as attorney-in-factII-8II-4EXHIBIT INDEXExhibitNumberExhibit Title4.1Form of Senior Secured Convertible Note (1)4.2Form of Series A Warrant (1)4.3Form of Series B Warrant (1)4.4Form of Series C Warrant (1)4.5Securities Purchase Agreement by and among Atrinsic, Inc. and the Buyers set forth on the signature pages thereto. (2)4.6Form of Registration Rights Agreement by and among Atrinsic, Inc. and the Buyers set forth on the signature pages thereto. (1)5.1Opinion of Stubbs, Alderton and Markiles, LLP.23.1Consent of Stubbs, Alderton & Markiles, LLP (included in Exhibit 5.1).23.2Consent of KPMG LLP.24.1Power of Attorney (3)(1)Incorporated by reference to our Current Report on Form 8-K filed on June 1, 2011.(2)Incorporated by reference to our Registration Statement on Form S-3/A filed on September 1, 2011.(3)Incorporated by reference to our Registration Statement on Form S-3 filed on July 1, 2011.II-5