As
filed with the Securities and Exchange Commission on April _____,
2008
Registration
No. 333-139882
United
States
Securities
and Exchange Commission
Washington,
D.C. 20549
Amendment
No. 2 on Form S-3
to
Form
S-3
Registration
Statement
under
the
Securities Act of 1933
LANGER,
INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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3842
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11-2239561
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(State
or Other Jurisdiction of
Incorporation
or Organization)
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(Primary
Standard Industrial
Classification
Code Number)
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(I.R.S.
Employer
Identification
Number)
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450
Commack Road
Deer
Park, New York 11729-4510
(Address,
Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's
Principal
Executive Offices)
W.
Gray Hudkins
President
and Chief Executive Officer
Langer, Inc.
450
Commack Road
Deer
Park, New York 11729-4510
631-667-1200
(Name,
Address, Including Zip Code, and Telephone Number, Including Area Code, of
Agent
for Service)
Copy
to:
Robert
L. Lawrence, Esq.
Kane
Kessler, P.C.
1350
Avenue of the Americas - 26
th
Floor
New
York, New York 10019
212-541-6222
Approximate
date of commencement of proposed sale to public: From time to time after the
effective date of this Registration Statement.
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, check the
following box.
x
If
this
Form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering.
o
If
this
Form is a post-effective amendment filed pursuant to Rule 462(d) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering.
o
The
registrant hereby amends this registration statement on such date or dates
as
may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a)
of the Securities Act or until the registration statement shall become effective
on such date as the Securities and Exchange Commission, acting pursuant to
said
Section 8(a), may determine.
CALCULATION
OF REGISTRATION FEE
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Title of securities to
be registered
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Amount to be
registered
1,2
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Proposed maximum
offering price per share
3
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Proposed maximum
aggregate offering price
3
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Amount of
registration fee
4
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Common
Stock, $0.02 par value per share
2
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7,572,004
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$1.85
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$14,008,821
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$550.55
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1.
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Pursuant
to Rule 416 promulgated under the Securities Act, there are also
registered hereunder such indeterminate number of additional shares
of
common stock as may be issued to the selling stockholders to prevent
dilution resulting from stock splits, stock dividends, or similar
transactions.
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2.
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6,080,000
shares of common stock were covered by the Registration Statement
on Form
S-3 (File No. 333-139882) of Langer, Inc., which was filed with the
Securities and Exchange Commission on January 9, 2007. Under Amendment
No.
1 of the Registration Statement, filed November 19, 2007, an additional
1,517,004 shares were registered, for a total of 7,597,004 shares.
By this
Amendment No. 2, the number of shares to be registered is being reduced
by
25,000 shares to 7,572,004 shares.
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3.
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Estimated
solely for the purpose of calculating the registration fee under
this
Amendment, pursuant to Rule 457(c) under the Securities Act of
1933, as amended, and based upon the average of the high and low
reported
sales prices of our Common Stock on The Nasdaq Global Market on April
15,
2008.
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4.
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No
fee is due with the filing of this Amendment No. 2, as fees have
been
previously paid in the amount of $3,175.40 when the Registration
Statement
(File No. 333-139882) was initially filed on January 9, 2007, and
when
Amendment No. 1 thereof was filed on November 19,
2007.
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EXPLANATORY
NOTE
The
original Registration Statement No. 333-139882, filed January 9, 2007, was
filed
on Form S-3. Amendment No. 1 thereof was filed on November 19, 2007, on Form
S-1, because the Company did not, at that time, meet the requirement with
respect to timely reporting of reports required to be filed under Sections
13
and 15(d) of the Securities Exchange Act of 1934, as amended. The Company is
now
in compliance with such requirements and is eligible to file this Amendment
No.
2 of the Registration Statement on Form S-3.
The
information in this prospectus is not complete and may be changed. The selling
stockholders may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is de-clared effective. This
prospectus is not an offer to sell these securities and neither we nor the
selling stock-holders are soliciting an offer to buy these securities in any
state where the offer or sale is not permitted.
Subject
to Completion, dated April 18, 2008
PROSPECTUS
LANGER, INC.
7,572,004
Shares of Common Stock,
par
value $0.02 per share
This
prospectus covers up to 7,572,004 shares of common stock, or interests therein,
that may be sold or otherwise disposed of from time to time by the stockholders
identified in the “Selling Stockholders” section of this prospectus. The shares
covered by this prospectus were issued in private transactions.
The
prices at which the selling stockholders or their transferees may dispose of
their shares will be determined by the selling stockholders at the time of
sale
and may be at the prevailing market price for the shares, at prices related
to
such market price, at varying prices determined at the time of sale, or at
negotiated prices. Information regarding the selling stockholders and the times
and manner in which they may offer and sell the shares under this prospectus
is
provided under “Selling Stockholders” and “Plan of Distribution” in this
prospectus.
We
will
not receive any of the proceeds from the sale of the shares offered under this
prospectus. However, 6,195,165 of the shares of common stock offered in this
prospectus will be issued only upon the conversion of our 5% Convertible
Subordinated Notes due December 7, 2011 (the "5% Convertible Notes" or the
“Notes”). To the extent the Notes are converted into common stock, we will be
relieved of indebtedness equal to the converted portion of the Notes. We will
pay all expenses (except brokerage fees and commissions and similar expenses)
relating to the registration of shares with the Securities and Exchange
Commission.
Our
common stock is listed on The Nasdaq Global Market. On April 15, 2008, the
closing price of our common stock was $1.85 per share.
YOU
SHOULD CAREFULLY CONSIDER THE RISK FACTORS FOR OUR SHARES, WHICH ARE LISTED
ON
PAGE 5 OF THIS PROSPECTUS. SEE “RISK FACTORS”.
Neither
the Securities and Exchange Commission nor any state securities commission
has
approved or disapproved of these securities or determined if this prospectus
is
truthful or complete. Any representation to the contrary is a criminal
offense.
You
should rely only on the information provided in, or incorporated by reference
in, this prospectus. We have not authorized anyone else to provide you with
any
information that is not in, or incorporated by reference in, the
prospectus.
This
prospectus is not an offer to sell the common stock in any state where the
offer
is not permitted. The information in this document may only be accurate on
the
date of this document. Information contained on our website does not constitute
part of this document.
The
date
of this prospectus is April ____, 2008.
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Page
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Where
You Can Find More Information About Us
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ii
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Incorporation
of Information by Reference
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ii
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Special
Note Regarding Forward-Looking Statements
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iii
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Prospectus
Summary
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1
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The
Offering
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4
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Risk
Factors
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5
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Use
of Proceeds
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19
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Selling
Stockholders
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20
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Plan
of Distribution
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30
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Experts
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31
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Legal
Matters
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32
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Material
Changes
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32
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WHERE
YOU CAN FIND MORE INFORMATION ABOUT US
This
prospectus is part of a registration statement we have filed with the Securities
and Exchange Commission relating to the common stock being offered by the
selling stockholders. The registration statement contains exhibits and other
information about us and the offering that are not included in this prospectus.
We also file annual, quarterly and current reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and copy
these documents, as well as the registration statement, at the Securities and
Exchange Commission’s Public Reference Room at 100 F Street, N.E., Washington,
D.C. 20549. You may obtain information on the operation of the Public Reference
Room by calling the Securities and Exchange Commission at 1-800-SEC-0330. The
SEC maintains an Internet site at which our SEC filings may be found. The
address of that site is http://www.sec.gov. You can also obtain information
about us at our website, the address of which is
http://www.langerinc.com.
INCORPORATION
OF INFORMATION BY REFERENCE
The
Securities and Exchange Commission (the “Commission”) allows us to “incorporate
by reference” the information we file with them, which means that we can
disclose important information to you by referring to those documents. The
information incorporated by reference is considered to be a part of this
prospectus. We incorporate by reference the documents listed below:
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(a)
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Annual
Report on Form 10-K for the year ended December 31, 2007, filed with
the
Commission on March 31, 2008;
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(b)
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Current
Report on Form 8-K, Date of Event - January 23, 2007; filed with
the
Commission on January 29, 2007;
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(c)
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Current
Report on Form 8-K/A, Date of Event - January 23, 2007; filed with
the
Commission on April 9, 2007;
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(d)
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Current
Report on Form 8-K, Date of Event - January 18, 2008; filed with
the
Commission on January 23, 2008;
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(e)
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Current
Report on Form 8-K, Date of Event - February 5, 2008; filed with
the
Commission on February 7, 2008;
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(f)
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Current
Report on Form 8-K, Date of Event - March 31, 2008; filed with the
Commission on March 31, 2008;
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(g)
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Current
Report on Form 8-K, Date of Event - April 16, 2008; filed with the
Commission on April 18, 2008;
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(h)
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Definitive
Proxy Statement dated May 23, 2007 and filed with the Commission
on May
24, 2007, relating to the Company’s 2007 Annual Meeting of Stockholders
held on June 20, 2007;
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(i)
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Definitive
Proxy Statement dated March 20, 2007 and filed with the Commission
on
March 21, 2007 relating to the Special Meeting of Stockholders
held on
April 19, 2007;
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(j)
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Definitive
Proxy Statement (Amendment No. 1) dated March 21, 2007 and filed
with the
Commission on March 26, 2007 relating to the Special Meeting
of
Stockholders held on April 19, 2007;
and
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(k)
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The
description of the Company's common stock contained in the Company's
Registration Statement on Form 8-A (Reg. No. 000-12991), filed
with the Commission as of July 3, 2002 by the Company to register
such securities under the Exchange Act, including all amendments
and
reports filed for the purpose of updating that
description.
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All
of
such documents are on file with the Commission. In addition, all documents
filed
by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act,
subsequent to the date of this Prospectus and prior to termination of the
offering are incorporated by reference in this Prospectus and are a part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to
be modified or superseded for purposes of this Prospectus to the extent that
a
statement contained herein or in any subsequently filed document that is also
incorporated by reference herein modifies or replaces such statement. Any
statements so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
This
Prospectus incorporates herein by reference important business and financial
information about us that is not included in or delivered with this Prospectus.
This information is available to you without charge upon written or oral
request. If you would like a copy of any of this information, please submit
your
request to us at Langer, Inc., 450 Commack Road, Deer Park, New York
11729-4510, Attention: Corporate Secretary, or call
(631) 667-1200.
You
should rely only on the information incorporated by reference or provided in
this Prospectus or any Prospectus supplement. We have not authorized anyone
else
to provide you with different information. You should not assume that the
information in this Prospectus or any Prospectus supplement is accurate as
of
any date other than the date on the front page of those documents.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain
statements we make in this prospectus and the documents incorporated by
reference in this prospectus may constitute “forward-looking statements” within
the meaning of the Federal securities laws. Forward-looking statements include
statements concerning our plans, objectives, goals, strategies, future events,
future revenues or performance, capital expenditures, financing needs, plans
or
intentions relating to acquisitions, our competitive strengths and weaknesses,
our business strategy and the trends we anticipate in the industry and economies
in which we operate and other information that is not historical information.
Words or phrases such as “estimates,” “expects,” “anticipates,” “projects,”
“plans,” “intends,” “believes” and variations of such words or similar
expressions are intended to identify forward-looking statements. These
statements reflect our current views about future events based on information
currently available and assumptions we make. These forward-looking and other
statements, which are not historical facts, are based largely upon our current
expectations and assumptions and are subject to a number of risks and
uncertainties that could cause actual results to differ materially from those
contemplated by such forward-looking statements.
These
risks and uncertainties include, among others:
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Our
history of net losses and the possibility of continuing net
losses.
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We
may not be able to manage our
growth.
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Risks
associated with our strategy of acquiring and integrating
businesses.
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The
risk that we may not be able to raise adequate financing to fund
our
operations and growth prospects.
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Accordingly,
we advise you to carefully review the information set forth in "Risk Factors,"
starting at page 5.
We
cannot
guarantee our future performance nor can we assure you that we will be
successful in the implementation of our growth strategy or that any such
strategy will result in our future profitability. Our failure to successfully
implement our growth strategy could have a material adverse effect on the market
price of our common stock and our business, financial condition and results
of
operations. You also should be aware that, other than as required by law, we
have no obligation to, and do not intend to, update any forward-looking
statements to reflect events or circumstances occurring after the date of this
prospectus that may cause our actual results or performance to differ from
those
expressed in the forward-looking statements.
PROSPECTUS
SUMMARY
The
items in the following summary are described in more detail later in this
prospectus or in information incorporated by reference in this prospectus.
This
summary provides an overview of selected information and does not contain all
of
the information you should consider. Therefore, you should also read the more
detailed information set out in this prospectus, including the financial
statements and the related notes incorporated herein by reference and the other
information incorporated herein by reference. References in this prospectus
to
“Langer” the “Company,” “we,” “our” and “us” refer to Langer, Inc. and, if so
indicated or if the context requires, includes our wholly-owned
subsidiaries.
Overview
We
design, manufacture and distribute high-quality medical products and services
targeting the long-term care, orthopedic, orthotic and prosthetic markets.
Through our wholly-owned subsidiaries, Twincraft, Inc., and Silipos, Inc.,
we
also offer a diverse line of personal care products for the private label
retail, medical, and therapeutic markets. We sell our medical products primarily
in the United States and Canada, as well as in more than 30 other countries,
to
national, regional, and international distributors, directly to healthcare
professionals, and directly to patients in instances where we also are providing
product fitting services. We sell our personal care products primarily in North
America to branded marketers of such products, specialty retailers, direct
marketing companies, and companies that service various amenities markets.
We
acquired Twincraft, a leading designer and manufacturer of bar soap, and the
business of Regal Medical Supply, LLC, a North Carolina limited liability
company (“Regal”), which is a provider of contracture management products and
services to patients in long-term care and other rehabilitation settings, in
January 2007.
Our
broad
range of over 500 orthopedic products, including custom foot and ankle orthotic
devices, pre-fabricated foot products, rehabilitation products, and gel-based
orthopedic and prosthetics products, are designed to correct, protect, heal
and
provide comfort for the patient. Through Regal, we also provide patient services
in long-term care settings by assisting facility personnel in product selection,
order fulfillment, product fitting and billing services. Our line of personal
care products includes bar soap, gel-based therapeutic gloves and socks, scar
management products, and other products that are designed to cleanse and
moisturize specific areas of the body, often incorporating essential oils,
vitamins and nutrients to improve the appearance and condition of the
skin.
Acquisition
History
In
February 2001, an investor group and management team led by our current Chairman
of the Board of Directors, Warren B. Kanders, purchased a controlling interest
in Langer, Inc., a custom orthotics company distributing its products primarily
to podiatric professionals.
The
investor group and management team since that time have evolved the Company’s
business toward a growth strategy in both the medical products and personal
care
industries. Since that time, we have consummated the following strategic
acquisitions:
•
Twincraft
. On
January 23, 2007, we acquired Twincraft, our largest acquisition to date, a
designer and manufacturer of bar soap focused on the health and beauty, direct
marketing, amenities and mass market channels. We acquired Twincraft to expand
into additional product categories in the personal care market, to increase
our
customer exposure for our current line of Silipos gel-based skincare products,
and to take advantage of potential commonalities in research and development
advances between Twincraft’s and our product groups. The aggregate consideration
paid by us in connection with this acquisition was approximately $30.6 million,
including transaction costs, paid in cash ($25,938,353) and common stock
($4,701,043 valued at $4.40 per share) of the Company. The sellers of Twincraft
can earn additional compensation in 2008, based upon the achievement of specific
EBITDA targets per the terms of the Twincraft purchase agreement.
•
Regal
. On
January 8, 2007, we acquired Regal, a provider of contracture management
products and services to patients in long-term care and other rehabilitation
settings. We acquired Regal as part of an effort to gain access to the long-term
care market, to gain a captive distribution channel for certain custom products
we manufacture into a market we previously had been unable to penetrate, to
obtain higher average selling prices for these products, and to establish a
national network of service professionals to enhance our customer relationships
in our core markets and new markets. The initial consideration for Regal was
approximately $1.7 million, which has since been reduced to approximately $1.4
million due to a shortfall in the amount of working capital delivered at closing
and certain other post-closing adjustments.
•
Silipos
. On
September 30, 2004, we acquired Silipos, Inc., a designer, manufacturer and
marketer of gel-based products focusing on the orthopedic, orthotic, prosthetic,
and skincare markets. We acquired Silipos because of its distribution channels
and proprietary products, and to enable us to expand into additional product
lines that are part of our market focus. The aggregate consideration paid by
us
in connection with this acquisition was approximately $17.3 million, including
transaction costs, paid in cash and notes.
•
Bi-Op
. On
January 13, 2003, we acquired Bi-Op Laboratories, Inc. (“Bi-Op”), which is
engaged in the design, manufacture and sale of footwear and foot orthotic
devices as well as orthotic and prosthetic services. We acquired Bi-Op to gain
access to additional markets and complementary product lines. The aggregate
consideration, including transaction costs, was approximately $2.2 million,
paid
in cash and shares of our common stock.
•
Benefoot
. On
May 6, 2002, we acquired the net assets of Benefoot, Inc., and Benefoot
Professional Products, Inc. (together, “Benefoot”). Benefoot designed,
manufactured and distributed custom orthotics, custom Birkenstock® sandals,
therapeutic shoes, and prefabricated orthotic devices to healthcare
professionals. We acquired Benefoot to gain additional scale in our historic
custom orthotics business as well as to gain access to complementary product
lines. The aggregate consideration, including transaction costs, was
approximately $7.9 million, consisting of cash, notes, the assumption of
liabilities consisting of approximately $0.3 million of long-term debt paid
at
closing and shares of our common stock.
Recent
Developments
•
In
January 2007, we made two acquisitions, Twincraft and Regal. See “Acquisition
History,” above.
•
In
November 2007 we began a study of strategic alternatives available to us with
regard to our various operating companies. We continue to consider acquisitions
in our target markets, as well as examine the possibility of divesting certain
assets.
•
Langer
UK
. On
January 18, 2008 we sold all of the outstanding capital stock of the Company’s
wholly-owned subsidiary, Langer (UK) Limited (“Langer UK”) to an affiliate of
Sole Solutions, a retailer of specialty footwear based in the United Kingdom.
The sale price was £587,500, or approximately $1,155,000, of which £475,000 was
paid at the closing and £112,500 is in the form of a note with 8½% interest due
in full in two years. Upon closing the Company entered into an exclusive sales
agency agreement and a distribution services agreement by which Langer UK will
act as sales agent and distributor for Silipos products in the United Kingdom,
Europe, Africa, and Israel. In 2007, we recognized a net loss of approximately
$176,000 associated with the disposal of Langer UK, due to a realized goodwill
impairment.
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As
of December 31, 2007, Langer UK is reflected in the financial statements
as a discontinued operation and the loss of approximately $176,000
associated with the sale of Langer UK is recorded in the financial
statements for the year ended December 31,
2007.
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•
Common
Stock Repurchase Program.
On
December 6, 2007, we announced that our Board had authorized the purchase of
up
to $2,000,000 of our outstanding common stock, using whatever means the Chief
Executive Officer may deem appropriate. In connection with this matter, the
Company’s senior lender, Wachovia Bank, National Association, has waived, until
March 31, 2008, the provisions of the credit facility that would otherwise
preclude the Company from making purchases of its common stock. Through March
17, 2008, the Company made one purchase consisting of 342,352 shares at a cost
of $694,975 (or $2.03 per share) including commissions paid.
THE
OFFERING
On
December 8, 2006, we issued and sold an aggregate of $28,880,000 of our 5%
convertible Subordinated Notes due December 7, 2011 (the “5% Convertible Notes”
or the “Notes”) to certain of the selling stockholders identified in the
“Selling Stockholders” section of this prospectus. The conversion price under
the Notes is a fixed price, subject to a weighted average anti-dilution
adjustment if the Company issues common stock for a consideration less than
the
applicable conversion price (with customary exceptions for issuances pursuant
to
stock incentive plans and options and warrants outstanding prior to the sale
of
the Notes). As a result of any adjustment that may be made pursuant to the
weighted average anti-dilution provisions of the Notes, the number of shares
of
common stock issuable upon conversion of the Notes may be increased on account
of downward adjustments in the conversion price of the common stock acquirable
upon conversion of the Notes. On the date of the sale of the Notes, based on
the
applicable conversion price on such date of $4.75, the Notes were convertible
into 6,080,000 shares of common stock, and the total market value of such shares
on the date of sale of the Notes was $25,613,915. Subsequent to the sale of
the
Notes, the conversion price was adjusted to $4.6617 pursuant to the
weighted-average anti-dilution provisions of the Notes, and based on the current
conversion price, the Notes are convertible into 6,195,165 shares of common
stock, such shares having a total market value of $1.85 based upon the closing
price of the Company’s common stock on April 15, 2008. On December 8, 2006, the
date that the Notes were sold, the fair market value of the Company's common
stock was $4.14 per share, and the aggregate fair market value of 6,195,165
shares of stock, which is the number presently acquirable upon conversion of
the
Notes, would be $25,647,983. Additional shares of common stock may hereafter
become issuable on conversion of the Notes if the conversion price is adjusted
under the terms of the Notes.
On
January 8, 2007, we acquired the business of Regal Medical Supply, LLC, a
North Carolina limited liability company (“Regal”), for an aggregate purchase
price of $1.7 million, which was paid through the issuance of 379,167 shares
of
our common stock, which has since been reduced to approximately $1.4 million,
or
308,483 shares of common stock, due to a shortfall in the amount of working
capital delivered by the seller at closing, and certain other post-closing
adjustments.
On
January 23, 2007, we acquired all of the capital stock of Twincraft for an
aggregate purchase price of approximately $26.7 million, with $22.7 million
paid in cash and the balance through the issuance of 999,375 shares of our
common stock. As a result of a post-closing upward adjustment to the purchase
price based upon the audit of Twincraft’s financial statements for its 2006
fiscal year, the Company paid the Twincraft sellers an additional $2,840,139
in
cash and issued an additional 68,981 shares of the Company's common
stock.
This
prospectus relates to the sale or other disposition of the shares of our common
stock, or interests therein, that we issued to stockholders of Twincraft and
Regal, and that are issued or issuable upon conversion of the Notes. We are
not
offering or selling any of our common stock in connection with this registration
statement.
RISK
FACTORS
The
following risk factors should be carefully considered in evaluating our
business, because such factors may have a significant impact on our business,
operating results, liquidity and financial condition. As a result of the risk
factors set forth below, actual results could differ materially from those
mentioned in any forward-looking statements. Additional risks and uncertainties
not presently known to us, or that we currently consider to be immaterial,
may
also impact our business, operating results, liquidity and financial condition.
If any of the following risks occur, our business, operating results, liquidity
and financial condition, and the price of our common stock, could be materially
adversely affected. You should also consider risk factors set forth in documents
incorporated herein by reference.
Risks
Related to Our Operations
We
have a history of net losses and may incur additional losses in the
future.
For
the
twelve months ended December 31, 2007, 2006, and 2005, the Company had
consolidated net losses of $4,517,977, $4,853,489, and $4,557,268 respectively.
We face the risk that these losses may continue beyond 2007. In order for us
to
achieve and maintain consistent profitability from our operations, we must
continue to achieve product revenue at or above current levels. We may increase
our operating expenses as we attempt to expand our product lines and acquire
other businesses and products. As a result, we may need to increase our revenues
significantly to achieve sustainable profitability. We cannot assure you that
we
will be able to achieve sustainable profitability. Any such failure could have
a
material adverse effect on the market price of our common stock and our
business, financial condition and results of operations.
Our
business plan relies on certain assumptions for the markets for our products
which, if incorrect, may adversely affect our
profitability.
We
believe that various demographics and industry-specific trends will help drive
growth in the medical and personal care markets, including:
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an
aging population with broad medical coverage, increased disposable
income
and longer life expectancy;
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a
growing emphasis on physical fitness, leisure sports and conditioning,
which will continue to lead to increased
injuries;
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increasing
awareness and use of non-invasive devices for prevention, treatment
and
rehabilitation purposes; and
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an
increase in the utilization of personal care products for various
applications, including cleansing, cosmetic and for the treatment
of
various conditions.
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These
demographics and trends are uncertain. The projected demand for our products
could materially differ from actual demand if our assumptions regarding these
factors prove to be incorrect or do not materialize, or if alternative
treatments to those offered by our products gain widespread
acceptance.
There
are significant risks associated with our strategy of acquiring and integrating
businesses.
A
key
element of our strategy is the acquisition of businesses and assets that will
complement our current business, increase size, expand our geographic scope
of
operations, and otherwise offer growth opportunities. We may not be able to
successfully identify attractive acquisition opportunities, obtain financing
for
acquisitions, make acquisitions on satisfactory terms, or successfully acquire
and/or integrate identified targets. Additionally, competition for acquisition
opportunities in our industries may escalate which would increase the costs
to
us of completing acquisitions or prevent us from making acquisitions. Our
ability to implement our acquisition strategy is also subject to other risks
and
costs, including:
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loss
of key employees, customers or suppliers of acquired
businesses;
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diversion
of management’s time and attention from our core
businesses;
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adverse
effects on existing business relationships with suppliers and
customers;
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our
ability to realize operating efficiencies, synergies, or other benefits
expected from an acquisition;
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risks
associated with entering markets in which we have limited or no
experience; and
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assumption
of contingent or undisclosed liabilities of acquisition
targets.
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In
addition, in connection with our acquisitions of Twincraft and Regal in 2007,
we
face the risk of incurring potential liabilities of those companies which may
not be covered by the limited indemnification in the relevant acquisition
agreements.
The
above
risks could have a material adverse effect on the market price of our common
stock and our business, financial condition and results of
operations.
We
may not be able to adequately manage our growth.
We
have
expanded, and may continue to expand, our business. This growth has placed
significant demands on our management, administrative, operating and financial
resources. The continued growth of our customer base, the types of products
offered and the geographic markets served can be expected to continue to place
a
significant strain on our resources. Personnel qualified in the production
and
marketing of our products are difficult to find and hire, and enhancements
of
information technology systems to support growth are difficult to implement.
Our
future performance and profitability will depend in large part on our ability
to
attract and retain additional management and other key personnel. Any failure
to
adequately manage our growth could have a material adverse effect on the market
price of our common stock and our business, financial condition and results
of
operations.
The
growth of our personal care business depends on the successful development
and
introduction of new products and services.
The
growth of our personal care business depends on the success of existing products
and services, including the manufacturing capabilities of our Twincraft
subsidiary, as well as the successful development and introduction of new
products manufacturing services, which face the uncertainty of customer
acceptance and reaction from competitors. In addition, our ability to create
new
products and new manufacturing services, and to sustain existing products and
services, is affected by whether we can:
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develop
and fund technological innovations;
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receive
and maintain necessary patent and trademark
protection;
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obtain
governmental approvals and registrations of regulated products and
manufacturing operations;
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comply
with Food and Drug Administration (FDA), Consumer Product Safety
Commission, and other governmental regulations;
and
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successfully
anticipate consumer needs.
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The
failure to develop and launch successful new products and provide new and
competitive manufacturing services could hinder the growth of our business.
Also, any delay in the development or launch of a new product could result
in
our not being the first to market, which could compromise our competitive
position.
Changes
in the requirements of our personal care customers and increasing dependence
on
key customers may adversely affect our business.
Our
personal care products are sold in a highly competitive global marketplace
which
is experiencing increased trade concentration. With the growing trend toward
consolidation, we are increasingly dependent on key customers, and some of
these
customers have greater bargaining strength than we do. They may use this
strength to demand lower prices, higher trade discounts, allowances or slotting
fees, which could lead to reduced sales or profitability. We may also be
negatively affected by changes in the requirements of our customers, such as
inventory de-stocking, and other conditions.
Rising
material and other costs and our increasing dependence on key suppliers could
adversely impact our profitability.
Raw
and
packaging material commodities are subject to wide price variations. Increases
in the costs of these commodities and other costs, such as energy costs, may
adversely affect the Company’s profit margins if we are unable to pass along any
higher costs in the form of price increases or otherwise achieve cost
efficiencies.
A
write-off of intangible assets may adversely affect our results of
operations.
At
December 31, 2007, our total assets include intangible assets of $36,414,000,
including goodwill acquired in connection with the acquisitions of Benefoot,
Bi-Op, Silipos, Twincraft, and Regal representing the excess of cost over the
fair value of the identifiable assets acquired. We may incur additional goodwill
in connection with other acquisitions we make in the future. We evaluate on
a
regular basis whether events and circumstances have occurred that indicate
that
all or a portion of the carrying amount of the goodwill or other intangible
assets may no longer be recoverable, in which case a charge to earnings would
be
required. In the year ended December 31, 2007, we recorded a loss of
approximately $176,000 associated with the disposal of Langer UK which included
an impairment of goodwill of approximately $463,000 associated with the
operations sold. In the year ended December 31, 2005, we recorded a provision
for impairment totaling $2,102,000, with regard to certain identifiable
intangible assets. In the future we may need to record additional provision(s)
for impairment, and such provision(s) may be material.
Our
business is highly competitive. If we fail to compete successfully, our sales
and operating results may be negatively affected and we may not achieve future
growth.
The
orthopedic, orthotic, prosthetic, skincare and personal care markets are highly
competitive. Certain of our competitors in these markets have more resources
and
experience as well as more recognizable trademarks for products similar to
those
sold by us. In addition, the market for orthopedic devices and related products
is characterized by new product development and corresponding obsolescence
of
existing products. Our competitors may develop new techniques, therapeutic
procedures or alternative products that are more effective than our current
technology or products or that render our technology or products obsolete or
uncompetitive, which could cause a decrease in orders for our custom orthotic
products. Such decreases would have a material adverse effect on the market
price of our common stock and our business, financial condition and results
of
operations.
We
may
not be able to develop successful new products or enhance existing products,
obtain regulatory clearances and approval of such products, and market such
products in a commercially viable manner or gain market acceptance for such
products. Failure to develop, license or market new products and product
enhancements could materially and adversely affect our competitive position,
which could cause a significant decline in our sales and
profitability.
We
expect
that the level of competition faced by us may increase in the future. Some
competitors have substantially greater financial, marketing, research and
technical resources than us. There can be no assurance that we will be able
to
compete successfully in the orthopedic, orthotic, prosthetic, skincare and
personal care markets. Any such failure could have a material adverse effect
on
the market price of our common stock and our business, financial condition
and
results of operations.
We
may not be able to raise adequate financing to fund our operations and growth
prospects.
Our
acquisition and product expansion programs, debt servicing requirements, and
existing operations will require substantial capital resources. We cannot assure
you that we will be able to generate sufficient operating cash flow or obtain
sufficient additional financing to meet these requirements. We negotiated and
executed a $20 million asset-based lending facility with Wachovia Bank, National
Association, which has been reduced to $15 million effective April 16, 2008.
However, this facility, alone, may not be adequate to supply the amount of
capital that may be required in the event of any material acquisition. As of
February 29, 2008, our availability under the credit facility was approximately
$6.2 million. Any material acquisition is subject to the approval of Wachovia.
If we do not have adequate resources and cannot obtain additional capital on
terms acceptable to us or at all, we may be required to reduce operating costs
by altering and delaying our business plan or otherwise radically altering
our
business practices. Failure to meet our future capital requirements could have
a
material adverse effect on the market price of our common stock and our
business, financial condition and results of operations.
Substantially
all our assets are pledged to a secured lender.
On
May
11, 2007, we entered into a loan and security agreement with Wachovia Bank,
National Association, under which we have obtained a credit facility for loans
and other financial accommodations of up to a maximum of $20 million, of which
$6.2 million is available as of February 29, 2008. As noted above, the maximum
amount of the credit facility has been reduced to $15 million. The amount of
funds available to us under the credit facility is based primarily on our levels
of eligible accounts receivable and eligible inventory, and as of the date
of
this report, we have not borrowed any funds under the facility. Substantially
all our assets, including assets acquired in the future, are pledged to the
lender to secure our obligations to the lender. If we draw down funds under
the
credit facility and are unable to repay the funds when due, or are otherwise
in
default of the financial covenants and related obligations under the credit
facility, the lender would have the right to foreclose upon our assets, which
would have a material adverse effect on our business, prospects, financial
condition and results of operations.
We
may be adversely affected by legal actions or proceedings.
On
or
about February 13, 2006, Dr. Gerald P. Zook filed a demand for arbitration
with
the American Arbitration Association, naming Langer, Inc., and Silipos as 2
of
the 16 respondents. (Four of the other respondents are the former owners of
Silipos and its affiliates, and the other 10 respondents are unknown entities.)
The demand for arbitration alleges that Silipos is in default of obligations
to
pay royalties in accordance with the terms of a license agreement between Dr.
Zook and Silipos dated as of January 1, 1997, with respect to seven patents
owned by Dr. Zook and licensed to Silipos. Silipos has paid royalties to Dr.
Zook, but Dr. Zook claims that greater royalties are owed. The demand for
arbitration seeks an award of $400,000 and reserves the right to seek a higher
award after completion of discovery. Dr. Zook has agreed to drop Langer, Inc.
(but not Silipos) from the arbitration, without prejudice. The proceeding is
in
the discovery stage.
Additionally,
in the normal course of business, we may be subject to claims and litigation
in
the areas of general liability, including claims of employees, and claims,
litigation or other liabilities as a result of acquisitions we have completed.
The results of legal proceedings are difficult to predict and we cannot provide
you with any assurance that an action or proceeding will not be commenced
against us, or that we will prevail in any such action or proceeding. An
unfavorable outcome of the arbitration proceeding commenced by Dr. Gerald P.
Zook against Silipos may adversely affect our rights to manufacture and/or
sell
certain products or raise the royalty costs of those certain
products.
An
unfavorable resolution of any legal action or proceeding could materially
adversely affect the market price of our common stock and our business, results
of operations, liquidity or financial condition.
We
rely heavily on our relationships with healthcare practitioners, agents and
distributors for marketing our products, and our failure to maintain these
relationships could adversely affect our business.
The
sales
of our products depend significantly on the prescription or recommendation
of
such products by podiatrists, orthopedists, orthopedic surgeons, dermatologists,
cosmetic and plastic surgeons, occupational and physical rehabilitation
professionals, prosthetists, orthotists and other healthcare professionals.
Failure of our products to retain the support of these surgeons and other
specialists, or the failure of our products to secure and retain similar support
from leading surgeons and other specialists, could have a material adverse
effect on the market price of our common stock and our business, financial
condition and results of operation.
Our
marketing success also depends largely upon arrangements with agents and
distributors. Our success depends upon our agents and distributors sales and
service expertise and their relationships with the customers in the marketplace.
Our failure to maintain relationships with our agents and distributors for
marketing our products could have an adverse effect on the market price of
our
common stock and our business, financial condition and results of
operations.
We
enter into multi-year contracts with customers that can impact our
results.
We
enter
into multi-year contracts with some of our customers which include terms
affecting our pricing flexibility. There can be no assurance that these
restraints will not have an adverse impact on our margins and operating income.
While we have a diverse customer base, and no customer or distributor
constituted more than 2.4% of our consolidated revenues for the year ended
December 31, 2007, we do have customers and independent, third-party
distributors, the loss of which could have a material negative effect on our
consolidated results of operations.
The
nature of our business could subject us to potential product liability and
other
claims.
The
sale
of orthotic and prosthetic products and other biomechanical devices and personal
care products entails the potential risk of physical injury to patients and
other end users and an inherent risk of product liability, lawsuits and product
recalls. We currently maintain product liability insurance with coverage limits
of $1 million per occurrence and for an annual aggregate maximum subject to
a
deductible of $25,000. However, we cannot assure you that this coverage would
be
sufficient to cover the payment of any potential claim. In addition, we cannot
assure you that this or any other insurance coverage will continue to be
available or, if available, will be obtainable at a reasonable cost. Our
existing product liability insurance coverage may be inadequate to protect
us
from any liabilities we might incur, and we will continue to be exposed to
the
risk that our claims may be excluded and that our insurers may become insolvent.
A product liability claim or series of claims brought against us for uninsured
liabilities or liabilities in excess of our insurance coverage could have a
material adverse effect on the market price of our common stock and our
business, financial condition and results of operations. In addition, as a
result of a product liability claim, our reputation could be harmed and we
may
have to recall some of our products, which could result in significant costs
to
us and have a material adverse effect on the market price of our common stock
and our business, financial condition and results of operations.
Health
care regulations could materially adversely affect the market price of our
common stock and our business, financial condition and results of
operations.
Our
businesses are subject to governmental regulation and supervision in the United
States at the federal and state levels and abroad. These regulations include
regulations of the FDA of our medical and personal care products, and
regulations regarding Medicare, Medicaid and physician self-referrals for
certain of our medical devices, products and services. Any time we acquire
a new
company, we are subject to certain disclosure, enrollment and other requirements
regarding the acquired Company’s ongoing operations. In connection with the
acquisition of Regal we only recently acquired the membership interests of
Regal
Medical Supply, LLC, in order to effectuate the original intent of the parties
and ensure that its provider numbers and taxpayer identification number were
effectively acquired with the Company’s purchase of Regal. In addition,
Twincraft, our newly acquired soap manufacturing business (which is part of
our
personal care segment) is also subject to far reaching regulation by the
Consumer Product Safety Commission which may require us to alter one or more
of
our practices to be in compliance with these laws such as obtaining regulatory
approvals and otherwise comply with regulations regarding safety, quality and
efficacy standards of our medical products, and safety and manufacturing
practices of our soap products.
If
we
fail to obtain these approvals or otherwise comply with applicable regulatory
requirements, it could result in government authorities taking punitive actions
against us, including, among other things, imposing fines and penalties on
us or
preventing us from manufacturing or selling our products. In addition, health
care fraud and abuse regulations are complex, and even minor or inadvertent
irregularities in submissions can potentially give rise to claims that the
statute has been violated. No assurance can be given that the federal government
will interpret these requirements, which are often highly technical and subject
to interpretation, in the same manner as the Company has, or that regulatory
authorities will not question the manner in which Regal was conducted prior
to
acquisition of the membership interests of Regal Medical Supply, LLC. Any
violations of these laws, including those relating to Medicare and Medicaid
reimbursement for the period prior to the acquisition of the membership
interests of Regal Medical Supply, LLC, could result in claims for repayment
of
prior reimbursements or otherwise have a material adverse effect on the market
price of our common stock and our business, financial condition and results
of
operations. Moreover, we cannot assure you that these laws and regulations
will
not change or be interpreted in the future in a manner which restricts or
adversely affects our business activities or relationships with providers of
orthotic and biomechanical products.
Changes
in government and other third-party payer reimbursement levels could adversely
affect the revenues and profitability of our medical
segment.
Our
medical products are sold by us through our network of national, regional,
independent and international distributors, hospitals, doctors and other
healthcare providers, many of whom are reimbursed for the healthcare services
provided to their patients by third-party payers, such as government programs,
including Medicare and Medicaid, private insurance plans and managed care
programs. Many of these programs set maximum reimbursement levels for certain
of
the products sold by us in the United States. We may be unable to sell our
products through our distribution channels on a profitable basis if third-party
payers deny coverage or reduce their current levels of reimbursement, or if
our
costs of production increase faster than increases in reimbursement levels.
The
percentage of our sales dependent on Medicare or other insurance programs may
increase as the portion of the United States population over age 65 continues
to
grow, making us more vulnerable to reimbursement level reductions by these
organizations. Reduced government reimbursement levels could result in reduced
private payer reimbursement levels because of indexing of Medicare fee schedules
by certain third-party payers. Furthermore, the healthcare industry is
experiencing a trend towards cost containment as government and private insurers
seek to contain healthcare costs by imposing lower reimbursement rates and
negotiating reduced contract rates with service providers.
Outside
the United States, reimbursement systems vary significantly by country. Many
foreign markets have government-managed health care systems that govern
reimbursement for new devices and procedures. The ability of hospitals supported
by such systems to purchase our products is dependent, in part, upon public
budgetary constraints. Canada and some European countries, for example, have
tightened reimbursement rates. If adequate levels of reimbursement from
third-party payers outside of the United States are not obtained, international
sales of our products may decline, which could adversely affect our net sales
and could have a material adverse effect on the market price of our common
stock
and our business, financial condition and results of operations.
Our
business is subject to substantial government regulation relating to medical
products and services that could have a material adverse effect on our
business.
Government
regulation in the United States and other countries is a significant factor
affecting the research, development, formulation, manufacture and marketing
of
our products. In the United States, the FDA has broad authority to regulate
the
design, manufacture, formulation, marketing and sale of medical devices, and
other medical products, and many of our personal care products. FDA’s regulation
of personal care products includes ingredient, quality, and labeling
requirements. The Consumer Products Safety Commission has authority over our
non-cosmetic soap products and could require cautionary labeling for products
viewed as having irritant properties. The FTC has broad authority over all
product advertising to ensure statements are truthful and non-misleading.
Overseas, these activities are subject to foreign governmental regulation,
which
is in many respects similar to regulation in the United States but which vary
from country to country. United States and foreign regulation continues to
evolve, which could result in additional burdens on our operations. If we fail
to comply with applicable regulations we may be subject to, among other things,
fines, suspension or withdrawal of regulatory approvals, product recalls,
operating restrictions, and criminal prosecution. Additionally, the cost of
maintaining personnel and systems necessary to comply with applicable
regulations is substantial and increasing.
Some
of
our medical products may require or will require regulatory clearance or
approval prior to being marketed. The process of obtaining these clearances
or
approvals can be lengthy and expensive. We may not be able to obtain or maintain
necessary clearances or approvals for testing or marketing our products.
Moreover, regulatory clearances and approvals, if granted, may include
significant limitations on the indicated uses for which our products may be
marketed or other restrictions or requirements that reduce the value to us
of
the products. Regulatory authorities may also withdraw product clearances or
approvals if we fail to comply with regulatory standards or if any problems
related to our products develop following initial marketing. We are also subject
to strict regulation with respect to our manufacturing operations. This
regulation includes testing, control and documentation requirements, and
compliance with the Quality Systems Regulation and current good manufacturing
practices, which is monitored through inspections by regulatory
authorities.
Our
profitability depends, in part, upon our and our distributors’ ability to obtain
and maintain all necessary certificates, permits, approvals and clearances
from
the United States and foreign regulatory authorities and to operate in
compliance with applicable regulations. Delays in the receipt of, or failure
to
receive necessary approvals, the loss of previously obtained clearances or
approvals, or failure to comply with existing or future regulatory requirements
could have a material adverse effect on the market price of our common stock
and
our business, financial condition and results of operations.
The
portion of our personal care business that involves the sale of acne soaps
and
antimicrobial drug products is subject to substantial government regulation
that
could have a material adverse effect on our business.
Drug
products are subject to substantial government regulation in the United States
that affects the research, development, formulation, manufacture, storage,
distribution, labeling, and marketing of the products. This includes strict
regulation of all facets of the manufacturing process including production
and
process controls, packaging and labeling controls, holding and distribution,
testing, and documentation. Compliance with current good manufacturing practice
(GMP) regulations and adverse event reporting and recordkeeping requirements
are
monitored through FDA inspections. We are also subject to state requirements
and
licenses applicable to manufacturers of drug products.
Twincraft
has a dedicated manufacturing line for soaps that are subject to drug
regulations. Failure to pass a GMP inspection or to comply with these and other
applicable regulatory requirements could result in disruption of our operations
and manufacturing delays. Failure to take adequate corrective action could
result in, among other things, significant fines, seizures or recalls of
products, operating restrictions and criminal prosecution. We cannot assure
you
that the FDA or other governmental authorities would agree with our
interpretation of applicable regulatory requirements or that we have in all
instances fully complied with all applicable requirements. Any failure to comply
with applicable requirements could adversely affect our product sales and
profitability and could have a material adverse effect on the market price
of
our common stock and our business, financial condition and results of
operations.
Twincraft’s
acne soaps are subject to FDA regulation as OTC drug products under the final
monograph or regulation for topical antimicrobial drug products. Any deviation
from the specific ingredients, labeling requirements, or conditions described
in
the final monograph or the general drug regulations could misbrand the product
and render it an unapproved new drug. This could result in a variety of
enforcement actions against the Company and/or the product as well as the
reformulation or relabeling of our products, all of which could have a material
adverse effect on the market price of our common stock and our business,
financial condition and results of operations.
If
the
FDA, FTC, or CPSC disagrees with our characterization of our other skincare
products or product claims and determines that they are drug products, this
could result in a variety of enforcement actions which could require the
reformulation or relabeling of our products, the submission of information
in
support of the products’ claims or the safety and effectiveness of our products,
or more punitive action, all of which could have a material adverse effect
on
the market price of our common stock and our business, financial condition
and
results of operations.
Modifications
to our marketed devices may require FDA regulatory clearances or approvals
and
may require us to cease marketing or recall the modified devices until such
clearances or approvals are obtained.
The
medical products we market in the United States have obtained market clearance
through the Premarket Notification process under Section 510(k) of the FFDCA
or
are exempt from the 510(k) Premarket Notification requirements. We have modified
some of our products and product labeling since obtaining 510(k) clearance.
We
believe those changes did not trigger the requirement for a new 510(k) filing,
but if FDA were to disagree, we would be required to submit new 510(k) Premarket
Notifications for the modifications to our existing products. We may be subject
to enforcement action by the FDA for failure to file the 510(k) submissions
for
the product changes and be required to stop marketing the products while the
FDA
reviews the new 510(k) Premarket Notification submissions. If the FDA requires
us to go through a lengthier, more rigorous examination than we expect, our
product introductions or modifications could be delayed or canceled, which
could
cause our sales to decline or otherwise adversely impact our growth. In
addition, the FDA may determine that future products will be subject to the
more
costly, lengthy and uncertain Premarket Approval, or PMA, process. Products
that
are approved through the PMA process generally need FDA approval before they
may
be modified.
Our
products may be subject to product recalls even after receiving clearance or
approval, which would harm our reputation and our
business.
The
FDA,
the Consumer Products Safety Commission and foreign regulatory authorities
have
the authority to request and, in some cases, require the recall of products
if
they violate the FFDCA, or the comparable foreign law, and pose a risk of injury
or gross deception. Typical reasons for recalls are material deficiencies,
design defects or manufacturing defects or consumer complaints which are
substantiated by the Consumer Products Safety Commission. A government-mandated
or voluntary recall by us could occur as a result of component failures,
manufacturing errors, design defects, adulteration, misbranding, or any other
incidents related to our medical devices or personal care products, including,
but not limited to, adverse event reports, cease and desist communications
and
any other product liability issues related to our products. Any product recall
would divert managerial and financial resources and harm our reputation with
customers and our business.
If
our medical device products fail to comply with the FDA’s Quality System
Regulation, our manufacturing could be delayed, and our product sales and
profitability could suffer.
Our
device manufacturing processes are required to comply with the FDA’s Quality
System Regulation, which covers the procedures concerning (and documentation
of)
the design, testing, production processes, controls, quality assurance,
labeling, packaging, storage and shipping of our devices. We also are subject
to
state requirements and licenses applicable to manufacturers of medical devices.
In addition, we must engage in extensive recordkeeping and reporting and must
make available our manufacturing facilities and records for periodic unscheduled
inspections by governmental agencies, including the FDA, state authorities
and
comparable agencies in other countries. Moreover, failure to pass a Quality
System Regulation inspection or to comply with these and other applicable
regulatory requirements could result in disruption of our operations and
manufacturing delays. Failure to take adequate corrective action could result
in, among other things, significant fines, suspension of approvals, seizures
or
recalls of products, operating restrictions and criminal prosecution. We cannot
assure you that the FDA or other governmental authorities would agree with
our
interpretation of applicable regulatory requirements or that we have in all
instances fully complied with all applicable requirements. Any failure to comply
with applicable requirements could adversely affect our product sales and
profitability.
Loss
of the services of key management personnel could adversely affect our
business.
Our
operations are dependent upon the skill, experience and performance of a
relatively small group of key management and technical personnel, including
our
Chairman, our President and Chief Executive Officer and head of our personal
care business segment. The unexpected loss of the services of one or more of
key
management and technical personnel could have a material adverse effect on
the
market price of our common stock and our business, financial condition and
results of operations.
Our
Chairman devotes only as much of his time as is necessary to the affairs of
the
Company and also serves in various capacities with other public and private
entities, including blank check companies and not-for-profit entities affiliated
with Kanders & Company, an entity owned and controlled by Mr. Kanders. If
appropriate as a result of strategic changes in the nature of the Company’s
business, arrangements with certain executive officers of the Company may be
adjusted so they only devote as much as is necessary to the affairs of the
Company and serve other public and private entities including Kanders &
Company in various capacities. While management believes any such non-exclusive
arrangements involving Kanders & Company will benefit the Company by
availing itself of certain of the resources of Kanders & Company, the other
business interests of these individuals could limit their ability to devote
time
to our affairs.
Our
business, operating results and financial condition could be adversely affected
if we become involved in litigation regarding our patents or other intellectual
property rights.
The
orthopedic, orthotic, prosthetics and personal care product industries have
experienced extensive litigation regarding patents and other intellectual
property rights, and companies in this industry have used intellectual property
litigation in an attempt to gain a competitive advantage. Our products may
become subject to patent infringement claims or litigation or interference
proceedings declared by the United States Patent and Trademark Office (the
“USPTO”), or the foreign equivalents thereto to determine the priority of
inventions, by competitors or other companies. The defense and prosecution
of
intellectual property suits, USPTO interference proceedings or the foreign
equivalents thereto and related legal and administrative proceedings are both
costly and time consuming. An adverse determination in litigation or
interference proceedings to which we may become a party could:
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subject
us to significant liabilities to
third-parties;
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•
|
require
disputed rights to be licensed from a third-party for royalties that
may
be substantial;
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•
|
require
us to cease manufacturing, using or selling such products or technology;
or
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•
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result
in the invalidation or loss of our patent
rights.
|
Any
one
of these outcomes could have a material adverse effect on the market price
of
our common stock and our business, financial condition and results of
operations. Furthermore, we may not be able to obtain necessary licenses on
satisfactory terms, if at all. Even if we are able to enter into licensing
arrangements, costs associated with these transactions may be substantial and
could include the long-term payment of royalties. Accordingly, adverse
determinations in a judicial or administrative proceeding or our failure to
obtain necessary licenses could prevent us from manufacturing and selling our
products, or from using certain processes to make our products which would
have
a material adverse effect on the market price of our common stock and our
business, operating results and financial condition. Moreover, even if we are
successful in such litigation, the expense of defending such claims could be
material.
In
addition, we may in the future need to litigate to enforce our patents, to
protect our trade secrets or know-how or to determine the enforceability, scope
and validity of the proprietary rights of others. Such enforcement of our
intellectual property rights could involve counterclaims against us. Any future
litigation or interference proceedings may result in substantial expense to
us
and significant diversion of effort by our technical and management
personnel.
Intellectual
property litigation relating to our products could also cause our customers
or
potential customers to defer or limit their purchases of our products, or cause
healthcare professionals, agents and distributors to cease or lessen their
support and marketing of our products.
We
may not be able to maintain the confidentiality, or assure the protection,
of
our proprietary technology.
We
hold
or have the exclusive right to use a variety of patents, trademarks and
copyrights in several countries, including the United States that we are
dependent on, including approximately 35 patents and patent applications in
the
U.S. and certain foreign jurisdictions and a number of trademarks for
technologies and brands related to our product offerings. The ownership of
a
patent or an interest in a patent does not always provide significant
protection, and the patents and patent applications in which we have an interest
may be challenged as to their validity or enforceability. Others may
independently develop similar technologies or design around the patented aspects
of our technology. Challenges may result in potentially significant harm to
our
business. We are also dependent upon a variety of methods and technologies
that
we regard as proprietary trade secrets. In addition, we have (i) a
non-exclusive, paid up (except for certain administrative fees) license with
Applied Elastomerics, Incorporated (the “AEI License”) dated as of November 30,
2001, as amended, to manufacture and sell certain products using mineral oil
based gels under certain patents, during the life of such patents, and (ii)
a
license with Gerald Zook (the “Zook License”), effective as of January 1, 1997,
to manufacture and sell certain products using mineral oil based gels under
certain patents and know how, during the life of such patents, in exchange
for
sales based royalty payments, that is exclusive as to certain products but
is
non-exclusive as to others. We also have exclusive licenses to three types
of
orthotic devices which are patented in the United States and several foreign
countries. We believe our trademarks and trade names, including
Langer
TM
,
Sporthotics
TM
,
PPT
TM
,
Silipos
TM
,
Explorer Gel Liner
TM
,
Siloliner
TM
, and
Silopad
TM
,
contribute significantly to brand recognition for our products, and the
inability to use one or more of these names could have a material adverse affect
on our business. For the years ended December 31, 2007 and 2006, revenues
generated by the products incorporating the technology licensed under the AEI
License accounted for approximately 22.4% and 36.4% of our revenues. For the
years ended December 31, 2007 and 2006, revenues generated by products covered
by the Zook License, as we understand the Zook License, accounted for
approximately 4.3% and 8.7% of our revenues. In 2006, Dr. Gerald P. Zook, the
licensor of the Zook License, commenced an arbitration proceeding alleging
that
a broader range of products sold by us are covered by the Zook License and
that
more license fees are payable by us under the Zook License, but he subsequently
discontinued the arbitration against the Company with prejudice. See Item 3,
“Legal Proceedings.”
We
rely
on a combination of trade secret, copyright, patent, trademark, unfair
competition and other intellectual property laws as well as contractual
agreements to protect our rights to such intellectual property. Due to the
difficulty of monitoring unauthorized use of and access to intellectual
property, however, such measures may not provide adequate protection. There
can
be no assurance that courts will always uphold our intellectual property rights,
or enforce the contractual arrangements that we have entered into to protect
our
proprietary technology and trade secrets.
Further,
although we seek to protect our trade secrets, know-how and other unpatented
proprietary technology, in part, with confidentiality agreements with certain
of
our employees and consultants, we cannot assure you that:
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•
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these
confidentiality agreements will not be
breached;
|
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•
|
we
will have adequate remedies for any
breach;
|
|
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•
|
we
will not be required to disclose such information to the FDA or other
governmental agency in order for us to have the right to market a
product;
or
|
|
|
•
|
trade
secrets, know-how and other unpatented proprietary technology will
not
otherwise become known to or independently developed by our
competitors.
|
Any
finding of unenforceability, invalidity, non-infringement, or misappropriation
of our intellectual property could have a material adverse effect on the market
price of our common stock and our business, financial condition and results
of
operations. In addition, if we bring or become subject to litigation to defend
against claimed infringement of our rights or of the rights of others or to
determine the scope and validity of our intellectual property rights, such
litigation could result in substantial costs and diversion of our resources.
Unfavorable results in such litigation could also result in the loss or
compromise of our proprietary rights, subject us to significant liabilities,
require us to seek licenses from third parties, or prevent us from selling
our
products, which could have a material adverse effect on the market price of
our
common stock and our business, financial condition and results of
operations.
In
addition, our licenses, including the AEI License and the Zook License, could
be
terminated under a variety of circumstances including for material breach of
the
license agreements or in the event of the bankruptcy or insolvency of the
licensor. Any such termination could have a material adverse effect on the
market price of our common stock and our business, financial condition and
results of operations.
A
portion of our revenues and expenditures is subject to exchange rate
fluctuations that could adversely affect our reported results of
operations.
While
a
majority of our business is denominated in United States dollars, in 2008 we
maintain operations in Canada that require payments in the local currency and
payments received from customers for goods sold in these countries are typically
in the local currency. Consequently, fluctuations in the rate of exchange
between the United States dollar and certain other currencies may affect our
results of operations and period-to-period comparisons of our operating results.
For example, the value of the U.S. dollar has fallen over the last year relative
to the Canadian dollar (which is the principal foreign currency material to
our
business) causing an increase in our reported revenues when we convert the
higher valued foreign currencies into U.S. dollars. If the value of the U.S.
dollar were to increase in relation to that currency in the future, there could
be a negative effect on the value of our sales in that market when we convert
amounts to dollars when we prepare our financial statements.
We
may be liable for contamination or other harm caused by hazardous materials
that
we use.
Our
research and development and manufacturing processes involve the use of
hazardous materials. We are subject to federal, state and local regulation
governing the use, manufacture, handling, storage and disposal of hazardous
materials or waste. We cannot completely eliminate the risk of contamination
or
injury resulting from hazardous materials or waste, and we may incur liability
as a result of any contamination or injury. In addition, under some
environmental laws and regulations, we could also be held responsible for all
of
the costs relating to any contamination at our past or present facilities and
at
third-party waste disposal sites even if such contamination was not caused
by
us. We may incur significant expenses in the future relating to any failure
to
comply with environmental laws. Any such future expenses or liability could
have
a significant negative impact on our business, financial condition and results
of operations.
Our
quarterly operating results are subject to fluctuations.
Our
revenue and operating results have fluctuated and may continue to fluctuate
from
quarter to quarter due to seasonal factors and for other reasons. Revenues
derived from our sales of orthotic devices has historically been significantly
higher in North America in the warmer months of the year. Our experience has
also been that physical activities in general tend to increase in warmer weather
and that many patients of our customers in the healthcare profession tend to
defer healthcare purchases until the spring months. Other factors which can
result in quarterly variations include the timing and amount of new business
generated by us, the timing of new product introductions, our revenue mix,
acquisitions, the timing of additional selling and general and administrative
expenses to support the anticipated growth and development of new business
units
and the competitive and fluctuating economic conditions in the orthopedic
industry.
Quarter-to-quarter
comparisons of our operating results are not necessarily meaningful and should
not be relied upon as indications of likely future performance or annual
operating results. Reductions in revenues or net income between quarters could
result in a decrease in the market price of our common stock.
We
may be unable to realize the benefits of our net operating loss (“NOL”)
carryforwards.
NOLs
may
be carried forward to offset federal and state taxable income in future years
and eliminate income taxes otherwise payable on such taxable income, subject
to
certain adjustments. Based on current federal corporate income tax rates, our
NOL could provide a benefit to us, if fully utilized, of significant future
tax
savings. However, our ability to use these tax benefits in future years will
depend upon the amount of our otherwise taxable income. If we do not have
sufficient taxable income in future years to use the tax benefits before they
expire, we will lose the benefit of these NOL carryforwards permanently.
Additionally, future utilization of net operating losses may be limited under
existing tax law due to the change in control of Langer in 2001 and may be
further limited as a result of pending or future offerings of our common
stock.
The
amount of NOL carryforwards that we have claimed to date of approximately $11.4
million has not been audited or otherwise validated by the U.S. Internal Revenue
Service (the “IRS”). The IRS could challenge our calculation of the amount of
our NOL or any deductions or losses included in such calculation, and provisions
of the Internal Revenue Code may limit our ability to carry forward our NOL
to
offset taxable income in future years. If the IRS were successful with respect
to any challenge in respect of the amount of our NOL, the potential tax benefit
of the NOL carryforwards to us could be substantially reduced.
Changes
in accounting standards regarding stock option plans, which became applicable
to
the Company as of January 1, 2006, could limit the desirability of granting
stock options, which could harm our ability to attract and retain employees,
and
could also negatively impact our results of operations.
A
change
in accounting standards (Statement of Financial Accounting Standards (“SFAS”)
No. 123(R), “Share-Based Payment”), which replaced SFAS No. 123, “Accounting for
Stock-Based Compensation” and supersedes Accounting Principles Board Opinion
(“ABP”) No. 25, “Accounting for Stock Issued to Employees,” and related
Interpretations required all public companies to account for the fair value
of
stock options granted to employees as an expense effective as of the beginning
of the first fiscal year beginning after June 15, 2005. In 2007 and 2006, these
amounts were $281,661 and $186,322, respectively. Prior to 2006, we were
generally not required to record stock compensation expense in connection with
stock option grants, since grants had an exercise price equal to or greater
than
market. However, in 2005, the Company did have substantial non-cash charges
due
to certain stock option modifications. The requirement to expense stock options
may reduce the attractiveness to us of granting stock options because of the
additional expense associated with these grants, which would negatively impact
our reported results of operations. For example, if we had been required to
expense stock option grants in accordance with the revised rule, our recorded
net loss for the year ended December 31, 2005 of approximately $4,557,000 would
have been increased by approximately $2,837,000 (of which approximately $766,000
would have represented periodic expense relating to employee stock options
granted and $2,071,000 would have represented expenses relating to the
acceleration of the vesting of certain options to a net loss of approximately
$7,394,000. Nevertheless, stock options are an important employee recruitment
and retention tool, and we may not be able to attract and retain key personnel
if we reduce the scope of our employee stock option program. Accordingly, when
we grant options in the future, our future results of operations will be
negatively impacted, as could our willingness to use stock options as an
employee recruitment and retention tool.
Risks
Related to Our Common Stock
One
stockholder has the ability to significantly influence the election of our
directors and the outcome of corporate action requiring stockholder
approval.
As
of
March 24, 2008, Warren B. Kanders, our Chairman of the Board of Directors,
in
his capacity as sole manager and voting member of Langer Partners, LLC (“Langer
Partners”) and the sole stockholder of Kanders & Company, Inc., may be
deemed to be the beneficial owner of 3,100,884 shares, or approximately 25.4%
of
our outstanding common stock. Of this amount, 2,041,856 shares are issued and
outstanding, and the balance is acquirable under options, warrants and
convertible notes. (This amount does not include a restricted stock award of
500,000 shares, which presently will vest only if and when the Company has
earnings before interest, taxes, depreciation and amortization of at least
$10,000,000 in any period of four consecutive fiscal quarters, commencing with
the quarter beginning January 1, 2007). As of March 24, 2008, current executive
officers and directors, including Mr. Kanders, beneficially own an aggregate
of
4,684,767 shares, or approximately 42.0% of our outstanding common stock.
Consequently, Mr. Kanders, acting alone or together with our other officers
and
directors, has the ability to significantly influence all matters requiring
stockholder approval, including the election of our directors and the outcome
of
corporate actions requiring stockholder approval, such as a change in
control.
The
price of our common stock has been and is expected to continue to be volatile,
which could affect a stockholder’s return on investment.
There
has
been significant volatility in the stock market and in particular in the market
price and trading volume of securities of orthopedic and other health care
companies, which has often been unrelated to the performance of the companies.
The market price of our common stock has been subject to significant
fluctuations, and we expect it to continue to be subject to such fluctuations
for the foreseeable future. We believe the reasons for these fluctuations
include, in addition to general market volatility, the relatively thin level
of
trading in our stock, and the relatively low public float. Therefore, variations
in financial results, announcements of material events, technological
innovations or new products by us or our competitors, our quarterly operating
results, changes in general conditions in the economy or the health care
industry, other developments affecting us or our competitors or general price
and volume fluctuations in the market are among the many factors that could
cause the market price of our common stock to fluctuate
substantially.
Shares
of our common stock have been thinly traded in the past.
The
trading volume of our common stock has not been significant, and there may
not
be an active trading market for our common stock in the future. As a result
of
the thin trading market or “float” for our stock, the market price for our
common stock may fluctuate significantly more than the stock market as a whole.
Without a large float, our common stock is less liquid than the stock of
companies with broader public ownership and, as a result, the trading prices
of
our common stock may be more volatile. In the absence of an active public
trading market, an investor may be unable to liquidate his investment in our
common stock. Trading of a relatively small volume of our common stock may
have
a greater impact on the trading price for our stock than would be the case
if
our public float were larger. We cannot predict the prices at which our common
stock will trade in the future. Our common stock is currently traded on The
NASDAQ Global Market.
If
our shares of common stock are removed from listing on the Nasdaq Global Market,
our stock price and business opportunities may be adversely
affected.
Our
common stock is currently listed on the Nasdaq Global Market. To continue to
be
listed on the Nasdaq Global Market, we must continue to satisfy certain
“continued listing criteria,” including a minimum stock price of $1.00, minimum
market value of our listed shares of not less than $5,000,000, minimum of 400
shareholders holding at least 100 shares, and a minimum of at least 2 registered
market makers, and a majority of our directors must be “independent” as defined
in the Nasdaq rules. At the present time, we satisfy all these requirements,
except with respect to independent directors, as to which we have a grace period
for compliance until June 2008. However, our stock price has been declining
steadily, from $4.50 on November 7, 2007 to $1.88 on March 14, 2008. If our
share price continues to decline, or if market makers do not continue to make
a
market in our shares, we may fall out of compliance with the continued listing
criteria of the Nasdaq Global Market. If our common stock were delisted from
the
Nasdaq Global Market, the delisting may have an adverse impact on the price
of
our shares of common stock, the volatility of the price of our shares, and/or
the liquidity of an investment in our shares common stock. This may have the
further adverse effect of impairing our ability to use our common stock as
a
portion of the consideration for potential future acquisitions or similar
transactions.
We
may issue a substantial amount of our common stock in the future which could
cause dilution to investors and otherwise adversely affect our stock
price.
A
key
element of our growth strategy is to make acquisitions. As part of our
acquisition strategy, we may issue additional shares of common stock as
consideration for such acquisitions. These issuances could be significant.
To
the extent that we make acquisitions and issue our shares of common stock as
consideration, stockholders’ interest may be diluted. Any such issuance will
also increase the number of outstanding shares of common stock that will be
eligible for sale in the future. Persons receiving shares of our common stock
in
connection with these acquisitions may be more likely to sell off their common
stock than other investors, which may influence the price of our common stock.
In addition, the potential issuance of additional shares in connection with
anticipated acquisitions could lessen demand for our common stock and result
in
a lower price than might otherwise be obtained. We may issue common stock in
the
future for other purposes as well, including in connection with financings,
for
compensation purposes, in connection with strategic transactions or for other
purposes.
In
January and May, 2007, we issued an aggregate of 1,068,356 shares of our common
stock as part of the consideration we paid for the Twincraft acquisition, and
we
may issue additional shares in 2009 if Twincraft achieves certain performance
targets which entitle the sellers of Twincraft to additional considerations.
We
also issued 333,483 shares in connection with the Regal acquisition in 2007.
(The number of shares was reduced by 25,000 in March 2008, to adjust certain
matters in connection with the Regal acquisition.)
A
key
element of our compensation strategy is to base a portion of the compensation
payable to management and our directors on restricted stock awards and other
equity-based compensation, to align the interests of directors and management
with the interests of the stockholders. In 2007, we have issued restricted
stock
awards for an aggregate of 955,000 shares to 7 officers and directors, of which
restricted stock awards for 880,000 shares to 6 officers remain. These awards
will vest if and when the Company achieves certain financial and operating
targets or, in some cases, upon a change of control. None of the restricted
stock awards granted in 2007 is presently vested.
We
have a significant amount of convertible indebtedness outstanding and may issue
a substantial amount of our common stock in connection with these and other
outstanding securities and in connection with future acquisitions and our growth
plans; any such issuances of additional shares could adversely affect our stock
price.
On
December 8, 2006, we sold $28,880,000 of our 5% Convertible Notes in a private
placement. At the date of issuance, the 5% Convertible Notes were convertible
into 6,080,000 shares of our common stock at a conversion price of $4.75 per
share. As a result of the anti-dilution provisions of the 5% Convertible Notes
and the issuance of 1,068,356 shares of common stock in the Twincraft
acquisition and 333,483 shares in the Regal acquisition (which was reduced
by
25,000 shares in March 2008, to make certain adjustments), the 5% Convertible
Notes are now convertible into 6,195,165 shares of our common stock, at a
conversion price, as adjusted, of $4.6617 per share, subject to further
adjustment in certain circumstances. The conversion of the 5% Convertible Notes
could result in dilution in the value of the shares of our outstanding stock
and
the voting power represented thereby. The effect of the conversion of all of
our
outstanding 5% Convertible Notes would be to increase outstanding shares and
dilute current shareholders by approximately 55.5% at March 24, 2008. In
addition, the conversion price of our 5% Convertible Notes may be lowered under
the conversion price adjustment provisions of the notes in certain
circumstances, including if we issue common stock at a net price per share
less
than the conversion price then in effect or if we issue rights, warrants or
options entitling the recipients to subscribe for or purchase shares of our
common stock at a price per share less than the conversion price (after taking
into account any consideration we received for such rights, warrants or
options). A reduction in the conversion price would result in an increase in
the
number of shares issuable upon the conversion of our 5% Convertible Notes.
We
also have a significant number of stock options and warrants outstanding, and
restricted stock awards which would vest if we achieve certain performance
targets.
We
anticipate issuing additional shares of our common stock and may also issue
additional securities convertible into or exercisable or exchangeable for common
stock to finance acquisitions or for other reasons in the future. The number
of
outstanding shares of our common stock that will be eligible for sale in the
future is, therefore, likely to increase substantially. Persons receiving shares
of our common stock in connection with these acquisitions or financings may
be
more likely to sell large quantities of their common stock, which may adversely
affect the price of our common stock. In addition, the potential issuance of
additional shares in connection with anticipated acquisitions could lessen
demand for our common stock and result in a lower price than would otherwise
be
obtained. If our security holders sell substantial amounts of our common stock
in the public market, the market price of our common stock could fall. These
sales might make it more difficult for us to sell equity securities in the
future at a time and price that we deem appropriate and may require us to issue
greater amounts of our common stock to finance acquisitions. Additional shares
sold to finance acquisitions and conversions, exercises and exchanges of other
securities for common stock may also dilute our earnings per share.
Our
certificate of incorporation, our bylaws and Delaware law contain provisions
that could discourage, delay or prevent a takeover
attempt.
We
are
subject to the anti-takeover provisions of Section 203 of the Delaware General
Corporation Law. In general, Section 203 prohibits publicly-held Delaware
corporations to which it applies from engaging in a “business combination”
(generally including mergers, consolidations and sales of 10% or more of the
corporation’s assets) with an “interested stockholder” (generally defined as a
person owning 15% or more of the outstanding voting stock of the corporation,
subject to certain exceptions) 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 a prescribed manner. This provision could
discourage others from bidding for our shares and could, as a result, reduce
the
likelihood of an increase in our stock price that would otherwise occur if
a
bidder sought to buy our stock.
It
could
also discourage, delay or prevent another company from merging with us or
acquiring us, even if our stockholders were to consider such a merger or
acquisition to be favorable.
Additionally,
our Board of Directors has the authority to issue up to 250,000 shares of
preferred stock, and to determine the price, rights, preferences and
restrictions, including voting and conversion rights, of those shares without
any further action or vote by the stockholders. The rights of the holders of
common stock will be subject to, and may be adversely affected by, the rights
of
the holders of preferred stock that may be issued in the future. Such provisions
could adversely affect the holders of common stock in a variety of ways,
including by potentially discouraging, delaying or preventing a takeover of
us
and by diluting our earnings per share.
We
do not expect to pay dividends in the foreseeable future.
We
currently do not intend to pay any dividends on our common stock. We currently
intend to retain any earnings for working capital, repayment of indebtedness,
capital expenditures and general corporate purposes.
USE
OF PROCEEDS
We
will
not receive any proceeds from the sale of the shares of our common stock offered
and sold by the selling stockholders pursuant to this prospectus. The selling
stockholders will receive all of the proceeds from any such sales. However,
6,195,165 of the shares of common stock offered in this prospectus will be
issued only upon the conversion of the 5% Convertible Subordinated Notes in
the
principal amount of $28,880,000. To the extent the Notes are converted into
common stock, we will be relieved of indebtedness equal to the principal amount
of the converted Notes.
SELLING
STOCKHOLDERS
General
The
following table sets forth certain information regarding the beneficial
ownership of our outstanding shares of our common stock as of April 15, 2008,
by
each of the selling stockholders, and as adjusted to reflect the sale of the
shares in this offering. As of April 15, 2008, there were 11,136,860 shares
of
our common stock were outstanding. Informa-tion with respect to beneficial
ownership is based upon information obtained from the selling
stockholders.
Our
registration of the shares of our common stock covered by this prospectus does
not necessarily mean that the selling stockholders will sell any of our common
stock that we have registered.
Except
as
indicated in the table below or the footnotes to the table, none of the selling
stockholders has held any position or office or had a material relationship
with
us or any of our affiliates within the past three years, other than as a result
of the ownership of our common stock or securities convertible into or
exchangeable for (with or without the payment of additional consideration)
our
common stock.
Except
as
indicated below, each selling stockholder has informed us that it is not a
registered broker-dealer or an affiliate of a registered
broker-dealer.
Shares
listed under the heading "Number of Shares Being Offered" represent the number
of shares that may be sold by each selling stockholder pursuant to this
prospectus. Pursuant to Rule 416 of the Securities Act, the registration
statement of which this prospectus is a part also covers any additional shares
of our common stock which become issuable in connection with such shares because
of any stock dividend, stock split, anti-dilution adjustment of a conversion
price, or other similar transaction effected without the receipt of
consideration which results in an increase in the number of outstanding shares
of our common stock.
The
information under the heading "Shares of Common Stock Beneficially Owned Prior
to Offering" is determined in accordance with the rules of the Commission,
and
includes voting and investment power with respect to shares. Shares of common
stock acquirable upon exercise of options and warrants, or upon conversion
of
convertible securities, which are currently exercisable or convertible, or
exercisable or convertible within 60 days after April 15, 2008, are deemed
outstanding for the purpose of computing the percentage ownership of the person
holding the options, warrants or convertible securities, but are not deemed
outstanding for the purpose of computing the percentage of any other person.
The
numbers of shares acquirable on conversion of the 5% Convertible Notes held
by
the Selling Stockholders has been determined based on the Conversion Price
of
$4.6617 per share, which is the Conversion Price in effect on the date of this
Prospectus.
The
information under the heading "Shares of Common Stock Beneficially Owned After
Offering" assumes that each selling stockholder sells all of its shares offered
pursuant to this prospectus to unaffiliated third parties, that the selling
stockholders will acquire no additional shares of our common stock prior to
the
completion of this offering, and that any other shares of our common stock
beneficially owned by the selling stockholders will continue to be beneficially
owned. Each selling stockholder may sell all, part or none of its shares and
may
acquire additional shares of our common stock.
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|
|
Shares of Common Stock
Beneficially Owned Prior to Offering
|
|
|
|
Shares of Common Stock
Beneficially Owned After Offering
|
|
Name
of Beneficial Owner
|
|
Number
|
|
Percent
1
|
|
Number
of Shares Being Offered
|
|
Number
|
|
Percent
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AmGuard
Insurance Company
|
|
|
114,757
|
(3)
|
|
1.0
|
|
|
107,257
|
|
|
7,500
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ashford
Capital Partners, L.P.
|
|
|
312,762
|
(4)
|
|
2.6
|
|
|
312,762
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter
A. Asch
|
|
|
649,856
|
(5)
|
|
5.8
|
|
|
649,856
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares of Common Stock
Beneficially Owned Prior to Offering
|
|
|
|
|
Shares of Common Stock
Beneficially Owned After Offering
|
|
Name
of Beneficial Owner
|
|
Number
|
|
Percent
1
|
|
Number
of
Shares
Being
Offered
|
|
Number
|
|
Percent
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Richard
D. Asch
|
|
|
254,293
|
(6)
|
|
2.3
|
|
|
254,293
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Atlas
Capital, SA (Int'l)
|
|
|
214,514
|
(7)
|
|
1.9
|
|
|
214,514
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calm
Waters Partnership
|
|
|
287,857
|
(8)
|
|
2.5
|
|
|
214,514
|
|
|
73,343
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph
M. Candido
|
|
|
74,785
|
(9)
|
|
*
|
|
|
74,785
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commonfund
Hedged Equity Company
|
|
|
60,064
|
(10)
|
|
*
|
|
|
60,064
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finderne
LLC
|
|
|
20,378
|
(11)
|
|
*
|
|
|
20,379
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Arthur
Goldstein, a director of the Company prior to June 20,
2007
|
|
|
84,238
|
|
|
*
|
|
|
21,451
|
|
|
62,787
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Good
Steward Trading Company SPC
|
|
|
18,877
|
(12)
|
|
*
|
|
|
18,877
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Andrew
T. Greenspon
|
|
|
6,435
|
|
|
*
|
|
|
6,435
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carolyn
D. Greenspon
|
|
|
55,726
|
|
|
*
|
|
|
10,726
|
|
|
45,000
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stuart
P. Greenspon, a director of the Company
|
|
|
199,877
|
(13)
|
|
1.8
|
|
|
32,177
|
|
|
167,700
|
|
|
1.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hank
& Co.
|
|
|
111,976
|
(14)
|
|
*
|
|
|
111,976
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Warren
B. Kanders, as trustee for Allison Smith Kanders; Chairman of the
Board of
Directors of the Company
|
|
|
3,100,884
|
(15)
|
|
25.4
|
|
|
429,028
|
|
|
2,571,856
|
|
|
21.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Margaret
G. Kaplan
|
|
|
10,726
|
|
|
*
|
|
|
10,726
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Knott
Partners, LP
|
|
|
503,894
|
(16)
|
|
4.3
|
|
|
503,894
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Linerbrook
& Co.
|
|
|
218,804
|
(17)
|
|
1.9
|
|
|
218,804
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A.
Lawrence Litke
|
|
|
89,422
|
(18)
|
|
*
|
|
|
89,422
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Matterhorn
Offshore Fund, Ltd.
|
|
|
786,837
|
(19)
|
|
6.6
|
|
|
786,837
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Millennium
Partners, L.P.
|
|
|
858,056
|
(20)
|
|
7.2
|
|
|
858,056
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mulsanne
Partners LP
|
|
|
3,861
|
(21)
|
|
*
|
|
|
3,861
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares of Common Stock
Beneficially Owned Prior to Offering
|
|
|
|
|
Shares of Common Stock
Beneficially Owned After Offering
|
|
Name
of Beneficial Owner
|
|
Number
|
|
Percent
1
|
|
Number
of Shares Being Offered
|
|
Number
|
|
Percent
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RMS
Liquidating Trust
|
|
|
308,483
|
(22)
|
|
2.8
|
|
|
308,483
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shoshone
Partners LP
|
|
|
322,200
|
(23)
|
|
2.8
|
|
|
322,200
|
|
|
0
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wynnefield
Partners Small Cap Value, LP
|
|
|
231,514
|
(24)
|
|
1.9
|
|
|
214,514
|
|
|
17,000
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wynnefield
Partners Small Cap Value LP I
|
|
|
314,420
|
(24)
|
|
2.7
|
|
|
300,320
|
|
|
14,100
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wynnefield
Small Cap Value Offshore Fund, Ltd.
|
|
|
377,223
|
(24)
|
|
3.3
|
|
|
343,223
|
|
|
34,000
|
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
York
Credit Opportunities
|
|
|
1,072,570
|
(25)
|
|
8.8
|
|
|
1,072,570
|
|
|
0
|
|
|
*
|
_________________________
|
1.
|
Applicable
percentage of ownership for each selling stockholder in this column
is
based on 11,136,860 shares of our common stock outstanding as of
April 15,
2008, plus, for each Selling Stockholder, the number of additional
shares
acquirable by such stockholder within 60 days after the date hereof
upon
conversion or exercise of the Notes, options, warrants and other
rights to
acquire shares of the Company's common
stock.
|
|
2.
|
Applicable
percentage of ownership for each selling stockholder in this column
is
based on an aggregate of (i) the 11,136,860 shares presently
outstanding, (ii) the 6,195,165 shares that would be outstanding if
and when all the shares acquirable by the Selling Stockholders on
conversion of the Notes have been sold, and (iii) the number of
additional shares acquirable by such stockholder within 60 days after
the
date hereof upon exercise of the options, warrants and other rights
to
acquire shares of the Company's common
stock.
|
|
3.
|
Includes
7,500 shares acquirable upon exercise of warrants held by AmGuard
Insurance Company. Does not include 7,500 shares acquirable upon
exercise
of warrants held by NorGuard Insurance Company
,
an
affiliate of AmGuard Insurance Company, as to which AmGuard Insurance
Company disclaims beneficial ownership. The natural persons who exercise
voting and dispositive power with respect to the shares being offered
by
AmGuard Insurance Company are Mr. Y. Judd Shoval, Mrs. Susan W. Shoval,
and Mr. Jeffrey E. Picker.
|
|
4.
|
Does
not include 1,499,580 shares owned by Ashford Capital Management,
Inc., as
reported by Ashford Capital Management, Inc. on Schedule 13G, as
amended,
in its capacity as an investment adviser for clients other than Ashford
Capital Partners, L.P. Ashford Capital Management, Inc., is the investment
adviser of Ashford Capital Partners, L.P. According to such Schedule
13G,
as amended, Ashford Capital Management, Inc., has sole voting and
sole
dispositive power over an aggregate of 2,146,841 shares or our common
stock, which constitute 18.2% of our outstanding common stock (including
643,542 shares of common stock acquirable on conversion of 5% Convertible
Notes held by Ashford Capital Management, Inc., as investment adviser
for
certain of its clients). The natural persons who exercise voting
and
dispositive power with respect to the shares being offered by Ashford
Capital Partners, L.P. are Messrs. Theodore H. Ashford and Theodore
H.
Ashford III.
|
|
5.
|
Does
not included 200,000 shares acquirable under options held by Mr.
Peter A.
Asch, which are not presently exercisable, or any shares which Mr.
Asch
may become entitled to receive in 2009 under certain provisions of
the
purchase agreement by which the Company acquired the capital stock
of
Twincraft from him and the other former stockholders of Twincraft.
The
number of shares which he may be entitled to receive, if any, is
not
estimable as of the date hereof. Mr. Asch is the President and Chief
Executive Officer of Twincraft,
Inc.
|
|
6.
|
Does
not include any shares which Mr. Richard D. Asch may become entitled
to
receive in 2009 under certain provisions of the purchase agreement
by
which the Company acquired the capital stock of Twincraft from him
and the
other former stockholders of Twincraft. The number of shares which
he may
be entitled to receive, if any, is not estimable as of the date hereof.
Mr. Richard Asch served as a vice president of Twincraft from January
through June 2007.
|
|
7.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Atlas Capital, SA (Int'l) is Mr. Robert
Dwek.
|
|
8.
|
The
natural person who exercise voting and dispositive power with respect
to
the shares being offered by Calm Waters Partnership is Mr. Richard
S.
Strong, its managing partner.
|
|
9.
|
Does
not include 100,000 shares acquirable under options held by Mr. Candido,
which are not presently exercisable, or any shares which Mr. Candido
may
become entitled to receive in 2009 under certain provisions of the
purchase agreement by which the Company acquired the capital stock
of
Twincraft from him and the other former stockholders of Twincraft.
The
number of shares which he may be entitled to receive, if any, is
not
estimable as of the date hereof. Mr. Candido is Vice President of
Twincraft, Inc.
|
|
10.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Commonfund Hedged Equity Company is Mr.
David
M. Knott. Mr. Knott has filed a Schedule 13G, and one amendment thereof,
indicating that he exercises voting and dispositive power with respect
to
an aggregate of 1,684,208 shares of the Company’s common
stock.
|
|
11.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Finderne LLC is Mr. David M. Knott. Mr.
Knott
has filed a Schedule 13G, and one amendment thereof, indicating that
he
exercises voting and dispositive power with respect to an aggregate
of
1,684,208 shares of the Company’s common
stock.
|
|
12.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Good Steward Trading Company SPC is Mr.
David
M. Knott. Mr. Knott has filed a Schedule 13G, and one amendment thereof,
indicating that he exercises voting and dispositive power with respect
to
an aggregate of 1,684,208 shares of the Company’s common
stock.
|
|
13.
|
Includes
37,500 shares acquirable upon exercise of options awarded to Mr.
Stuart P.
Greenspon, a director of the Company, as to which 25,000 shares are
subject to lock-up agreements expiring at various times, not later
than
November 16, 2008. Does not include the shares owned by his adult
brother,
Andrew T. Greenspon; his adult daughter, Carolyn D. Greenspon; or
his
adult sister, Margaret G. Kaplan, all of whom are selling stockholders
hereunder; does not include 41,903 shares owned by his spouse; as
to the
shares owned by all such relatives, Mr. Stuart P. Greenspon disclaims
beneficial ownership thereof.
|
|
14.
|
Ashford
Capital Management, Inc., is the investment adviser for Hank & Co. and
exercises sole voting and sole dispositive power over the shares
owned by
Hank & Co. The natural persons who exercise voting and dispositive
power with respect to the shares being offered by Hank & Co. are
Messrs. Theodore H. Ashford and Theodore H. Ashford
III.
|
|
15.
|
Includes
100,000 options granted to Kanders & Company, Inc. that are presently
exercisable, 515,000 options granted to Mr. Kanders that are presently
exercisable, 15,000 shares acquirable upon exercise of warrants held
by
Langer Partners, LLC, 100,000 shares of restricted stock, which are
subject to a lock-up agreement that expires on September 1, 2008,
1,491,856 shares held by Langer Partners, LLC, and the 429,028 shares
of
common stock acquirable upon conversion of the $2,000,000 of 5%
Convertible Notes held by Mr. Kanders as a trustee for a member of
his
family. Mr. Kanders is the sole voting member and sole manager of
Langer
Partners, LLC and the sole stockholder of Kanders & Company, Inc. Does
not include 500,000 shares acquirable upon the vesting of a restricted
stock award granted January 23, 2007, which is not expected to vest
within
60 days after the date of this prospectus. Of the 515,000 options
described above, 183,333 options are subject to a lock-up agreement,
which
expires with respect to 91,667 shares on each of April 1, 2009 and
2010.
Kanders & Company, Inc., disclaims beneficial ownership of shares
owned or acquirable under options, warrants and convertible securities
not
directly owned by it; Langer Partners, LLC, disclaims beneficial
ownership
of shares owned or acquirable under options, warrants and convertible
securities not directly owned by it; and Warren B. Kanders disclaims
beneficial ownership of shares he holds in a fiduciary capacity and
shares
not directly owned by him. The 15,000 warrants held by Langer Partners,
LLC, entitle Langer Partners, LLC, to purchase a like number of shares
of
common stock at a price of $0.02 per share, or an aggregate price
of $300.
The market price per share of the Company's common stock on September
30,
2004, the date on which the warrants were purchased, was $6.90 per
share,
for a combined market price of $103,500 (determined by using the
market
price per share, without adjustment for the lack of registration
of the
shares underlying the warrants or attribution to the cost of the
warrants
of any portion of the purchase price of the senior subordinated notes
sold
with the warrants). Mr. Kanders is the Chairman of our Board of
Directors.
|
|
16.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Knott Partners, LLC, is Mr. David M.
Knott.
Mr. Knott has filed a Schedule 13G, and one amendment thereof, indicating
that he exercises voting and dispositive power with respect to an
aggregate of 1,684,208 shares of the Company’s common
stock.
|
|
17.
|
Ashford
Capital Management, Inc., is the investment adviser for Linerbrook
&
Co. and exercises sole voting and sole dispositive power over the
shares
owned by Linerbrook & Co. The natural persons who exercise voting and
dispositive power with respect to the shares being offered by Linerbrook
& Co. are Messrs. Theodore H. Ashford and Theodore H. Ashford
III.
|
|
18.
|
Does
not include 100,000 shares acquirable under options held by Mr. Litke,
which are not presently exercisable, or any shares which Mr. Litke
may
become entitled to receive in 2009 under certain provisions of the
purchase agreement by which the Company acquired the capital stock
of
Twincraft from him and the other former stockholders of Twincraft.
The
number of shares which he may be entitled to receive, if any, is
not
estimable as of the date hereof. Mr. Litke is the Chief Operating
Officer
of Twincraft, Inc.
|
|
19.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Matterhorn Offshore Fund, Ltd., is Mr.
David
M. Knott. Mr. Knott has filed a Schedule 13G, and one amendment thereof,
indicating that he exercises voting and dispositive power with respect
to
an aggregate of 1,684,208 shares of the Company’s common
stock.
|
|
20.
|
Millennium
Partners, L.P., has advised us that certain of its affiliates are
registered broker-dealers, and that Millennium Partners, L.P. acquired
the
shares offered hereby in the ordinary course of its business, and
at the
time of the purchase, it had no agreements or understandings, directly
or
indirectly, with any person to distribute its shares. Millennium
Management LLC, a Delaware limited liability company, is the managing
partner of Millennium Partners, L.P., and consequently may be deemed
to
have voting control and investment discretion over the securities
owned by
Millennium Partners L.P. Mr. Israel A. Englander is the managing
member of
Millennium Management LLC, and may be deemed to be the beneficial
owner of
any shares deemed to be beneficially owned by Millennium Management
LLC.
Millennium Management LLC, Millennium Partners, L.P., and Mr. Englander
have advised us that the foregoing should not be construed in and
of
itself as an admission by either of Millennium Management LLC, or
Mr.
Englander as to beneficial ownership of the shares of our common
stock
owned by Millennium Partners, L.P.
|
|
21.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by Mulsanne Partners LP is Mr. David M.
Knott.
Mr. Knott has filed a Schedule 13G, and one amendment thereof, indicating
that he exercises voting and dispositive power with respect to an
aggregate of 1,684,208 shares of the Company’s common
stock.
|
|
22.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by RMS Liquidating Trust is G. Barry Wilkinson,
Esq., as trustee u/t/a/ March 27, 2008. The beneficiaries of the
trust are
Roy Kelley, John P. Kenney, Linda A. Lee, Richard A. Nace, David
Ray, John
E. Shero and William J. Warning , who are the former holders of the
equity
interests of Regal Medical Supply,
LLC.
|
|
23.
|
The
natural persons who exercise voting and dispositive power with respect
to
the shares being offered by Ashford Capital Partners, L.P. are Messrs.
Theodore H. Ashford and Theodore H. Ashford
III.
|
|
24.
|
Wynnefield
Capital Management, LLC, a New York limited liability company (“WCM”) is
the sole general partner of each of Wynnefield Partners Small Cap
Value
LP, a Delaware limited partnership (“Wynnefield Partners”) and Wynnefield
Partners Small Cap Value LP I, a Delaware limited partnership (“Wynnefield
Partners I”). Nelson Obus and Joshua Landes are the co-managing members of
WCM and by virtue of such positions with WCM, have the shared power
to
vote and dispose of the shares of our common stock that are beneficially
owned by each of Wynnefield Partners and Wynnefield Partners I. Wynnefield
Capital, Inc., a Delaware corporation (“WCI”), is the sole investment
manager of Wynnefield Offshore. Messrs. Obus and Landes are the
co-principal executive officers of WCI and by virtue of such positions
with WCI, have the shared power to vote and dispose of the shares
of our
common stock that are beneficially owned by Wynnefield Offshore.
Each of
WCM, WCI and Messrs. Obus and Landes disclaims any beneficial ownership
of
the shares of our common stock that are directly beneficially owned
by
each of Wynnefield Partners, Wynnefield Partners I and Wynnefield
Offshore, except to the extent of their respective pecuniary interest
in
such shares.
|
|
25.
|
The
natural person who exercises voting and dispositive power with respect
to
the shares being offered by York Credit Opportunities is Mr. James
G.
Dinan.
|
Conversion
Discounts for Shares Underlying Warrants
The
following table sets forth the total possible profit that may be realized as
a
result of conversion discounts for common stock underlying the Company's
warrants issued September 30, 2004 that are held by certain of the selling
stockholders or affiliates of the selling stockholders. Such warrants were
issued to the purchasers of the Company's 7% subordinated notes due September
30, 2009 (the “7% Notes”), at the rate of 20 warrants for each $1,000 of
principal amounts of 7% Notes purchased. The 7% Notes were repaid in full,
with
interest, on June 15, 2005. (The shares acquirable on exercise of the warrants
are not covered by this prospectus.)
|
Selling
Stockholder
|
|
Market
price
per
share on
9/30/04
|
|
Exercise
price
on
9/30/04
1
|
|
Number
of
shares
acquirable
upon
exercise
|
|
Combined
market
price
|
|
Combined
exercise
price
|
|
Total
possible
discount
to
market
price
|
|
AmGuard
Insurance Company
|
|
$
|
6.90
|
|
$
|
0.02
|
|
|
15,000
2
|
|
$
|
103,500
|
|
$
|
300
|
|
$
|
103,200
|
|
Langer
Partners, LLC
3
|
|
$
|
6.90
|
|
$
|
0.02
|
|
|
15,000
|
|
$
|
103,500
|
|
$
|
300
|
|
$
|
103,200
|
|
Wynnefield
Partners Small Cap Value, LP
|
|
$
|
6.90
|
|
$
|
0.02
|
|
|
17,000
|
|
$
|
117,300
|
|
$
|
340
|
|
$
|
116,960
|
|
Wynnefield
Partners Small Cap Value LP I
|
|
$
|
6.90
|
|
$
|
0.02
|
|
|
14,000
|
|
$
|
96,600
|
|
$
|
280
|
|
$
|
96,320
|
|
Wynnefield
Small Cap Value Offshore Fund, Ltd.
|
|
$
|
6.90
|
|
$
|
0.02
|
|
|
14,000
|
|
$
|
96,600
|
|
$
|
280
|
|
$
|
96,320
|
|
Total
possible discount to market price for all Selling
Stockholders:
|
$
|
516,000
|
_____________________
|
1.
|
The
exercise price is set at a fixed price, subject to adjustment for
stock
splits and similar events.
|
|
2.
|
Includes
7,500 shares acquirable under warrants held by an affiliate of AmGuard
Insurance Company.
|
|
3.
|
Langer
Partners, LLC, is an affiliate of Warren B. Kanders, one of the selling
stockholders. Mr. Kanders is the Chairman of the Board of Directors
and,
personally and through other entities under his control, beneficially
owns
more than 10% of the Company's outstanding common
stock
|
Prior
Securities Transactions between the Selling Stockholders and the
Company
The
following table sets forth information about prior transactions between the
Company and the Selling Stockholders with respect to the Company's securities.
(None of the securities referred to below are covered by this
prospectus.)
|
|
|
|
|
Shares
outstanding prior
to
transaction
1
|
|
|
|
|
|
Market
price per share
|
|
|
Selling
Stockholder
|
|
Date
of
transaction
|
|
Total
|
|
Held
by
non-affiliates
|
|
Shares
in the transaction
|
|
Percent
2
|
|
Immediately
prior
to
transaction
3
|
|
As
of
April
15,
2008
|
|
|
AmGuard
Insurance Company
|
|
|
10/31/01
|
4
|
|
4,268,022
|
5
|
|
1,355,144
|
|
|
41,667
|
|
|
3.1
|
%
|
|
|
|
|
|
|
|
Peter
A. Asch
|
|
|
1/23/07
|
|
|
10,451,540
|
6
|
|
5,931,914
|
|
|
649,856
|
7
|
|
11.0
|
%
|
|
|
|
|
|
|
|
Richard
Asch
|
|
|
1/23/07
|
|
|
10,451,540
|
|
|
5,931,914
|
|
|
254,293
|
|
|
4.3
|
%
|
|
|
|
|
|
|
|
Atlas
Capital, S.A.
|
|
|
10/31/01
|
|
|
4,268,022
|
|
|
1,355,144
|
|
|
250,000
|
|
|
18.4
|
%
|
|
|
|
|
|
|
|
Joseph
Candido
|
|
|
1/23/07
|
|
|
10,451,540
|
|
|
5,931,914
|
|
|
74,785
|
|
|
1.3
|
%
|
|
|
|
|
|
|
|
Arthur
Goldstein
|
|
|
2/13/01
|
|
|
2,613,181
|
8
|
|
1,567,128
|
9
|
|
32,787
|
|
|
3.0
|
%
|
|
|
|
|
|
|
|
Carolyn
Greenspon
|
|
|
10/31/01
|
|
|
4,268,022
|
|
|
1,355,144
|
|
|
5,000
|
|
|
*
|
|
|
|
|
|
|
|
|
Langer
Partners, LLC
10
|
|
|
12/28/00
|
|
|
2,613,181
|
|
|
1,567,128
|
|
|
824,475
|
11
|
|
52.6
|
%
|
|
|
|
|
|
|
|
Langer
Partners, LLC
|
|
|
2/13/01
|
|
|
2,613,181
|
|
|
1,567,128
|
|
|
667,381
|
|
|
42.6
|
%
|
|
|
|
|
|
|
|
Kanders
& Company, Inc.
|
|
|
2/13/01
|
|
|
2,613,181
|
|
|
1,567,128
|
|
|
100,000
|
|
|
6.4
|
%
|
|
|
|
|
|
|
|
Langer
Partners, LLC
|
|
|
10/31/01
|
|
|
4,268,022
|
|
|
1,355,144
|
|
|
416,667
|
|
|
30.7
|
%
|
|
|
|
|
|
|
|
Langer
Partners, LLC
|
|
|
9/30/04
|
13
|
|
4,380,851
|
14
|
|
1,496,136
|
15
|
|
15,000
|
16
|
|
1.0
|
%
|
|
|
|
|
|
|
|
Warren
B. Kanders
|
|
|
11/12/04
|
|
|
4,380,851
|
|
|
1,496,136
|
|
|
100,000
|
17
|
|
6.7
|
%
|
|
|
|
|
|
|
|
Kanders
& Company, Inc.
|
|
|
11/12/04
|
|
|
4,380,851
|
|
|
1,496,136
|
|
|
240,000
|
18
|
|
16.0
|
%
|
|
|
|
|
|
|
|
Warren
B. Kanders
|
|
|
11/8/05
|
|
|
9,690,823
|
|
|
6,819,373
|
|
|
240,000
|
19
|
|
3.5
|
%
|
|
|
|
|
|
|
|
Warren
B. Kanders
|
|
|
11/8/05
|
|
|
9,690,823
|
|
|
6,819,373
|
|
|
275,000
|
20
|
|
4.0
|
%
|
|
|
|
|
|
|
|
Warren
B. Kanders
|
|
|
1/23/07
|
|
|
10,451,540
|
|
|
5,931,914
|
|
|
500,000
|
21
|
|
8.4
|
%
|
|
|
|
|
|
|
|
A.
Lawrence Litke
|
|
|
1/23/07
|
|
|
10,451,540
|
|
|
5,931,914
|
|
|
89,422
|
|
|
1.5
|
%
|
|
|
|
|
|
|
|
RMS
Liquidating Trust
|
|
|
1/8/07
|
|
|
10,072,373
|
|
|
6,954,556
|
|
|
333,483
|
22
|
|
4.8
|
%
|
|
|
|
|
|
|
|
Wynnefield
Small Cap Value, LP
|
|
|
9/30/04
|
|
|
4,380,851
|
|
|
1,496,136
|
|
|
17,000
|
|
|
1.1
|
%
|
|
|
|
|
|
|
|
Wynnefield
Small Cap Value, LP I
|
|
|
9/30/04
|
|
|
4,380,851
|
|
|
1,496,136
|
|
|
14,000
|
|
|
*
|
|
|
|
|
|
|
|
|
Wynnefield
Small Cap Value Offshore Fund, Ltd.
|
|
|
9/30/04
|
|
|
4,380,851
|
|
|
1,496,136
|
|
|
14,000
|
|
|
*
|
|
|
|
|
|
|
|
_______________________
|
1.
|
As
used in this table, "non-affiliates" means persons who are not
(i) selling stockholders, (ii) affiliates of selling
stockholders, or (iii) affiliates of the
Company.
|
|
2.
|
Determined
based upon shares in the transaction divided by shares issued and
outstanding prior to the transaction and held by non-affiliates and
persons other than the selling stockholders
.
|
|
3.
|
Prices
reported are closing prices as of the business day immediately prior
to
the date of the transaction, or the business day of the transaction,
if
the transaction was completed after the close of trading on such
day.
|
|
4.
|
All
transactions of all selling stockholders on October 31, 2001, represent
purchases of the Company's 4% Convertible Subordinated Notes due
August
31, 2006, which were convertible into common stock at the rate of
$6.00
per share. Said notes were paid in full on the due date, without
the
conversion of the notes by any of the selling stockholders or any
of their
affiliates or Company affiliates.
|
|
5.
|
Based
on shares outstanding as reported in the Company's balance sheet
as of
9/30/01 which is included in the Company's Quarterly Report on Form
10-Q
for the Quarter Ended 9/30/01.
|
|
6.
|
Based
on the number of shares outstanding as reported in the Company's
Quarterly
Report on Form 10-Q for the Quarter Ended September 30, 2006, increased
by
the 379,167 shares issued on January 8, 2007, in connection with
the Regal
acquisition. (The number of shares issued in the Regal acquisition
was
subsequently reduced in accordance with certain post-closing
adjustments.)
|
|
7.
|
The
numbers of shares reported for Messrs. Peter A. Asch, Richard Asch,
Joseph
Candido and Lawrence Litke include an aggregate of 68,981 shares
that were
issued to them in May 2007 as a result of adjustments to the purchase
price of the capital stock of Twincraft, Inc., based on a post-closing
audit of Twincraft, in accordance with the terms of the stock purchase
agreement between the Company and Messrs. Peter Asch, Richard Asch,
Candido and Litke dated as of November 14, 2006, which closed on
January
23, 2007. Messrs. Peter Asch, Richard Asch, Candido and Litke may
be
entitled to receive additional shares of the Company's common stock
pursuant to certain provisions of the aforesaid purchase agreement,
if
Twincraft achieves certain financial targets in either of the years
ended
December 31, 2007 and 2008.
|
|
8.
|
As
of January 5, 2001, as reported by the Company in its Quarterly Report
on
Form 10-Q for the quarter ended November 25,
2000.
|
|
9.
|
Determined
by deducting 1,046,053 shares, reported as owned by affiliates identified
in the Company's Proxy Statement filed June 30, 2000, in connection
with
its 2000 Annual Meeting of Stockholders, from 2,613,181 shares, the
number
of shares outstanding as set forth in the Company's Quarterly Report
on
Form 10-Q for the quarter ended November 25, 2000. The number of
shares
owned by affiliates does not include the numbers of shares acquirable
under options or other rights to acquire the Company's common
stock.
|
|
10.
|
Langer
Partners, LLC, and Kanders & Company, Inc., is each controlled by Mr.
Warren B. Kanders. Mr. Kanders is the Chairman of the Board of Directors
of the Company and a beneficial holder of more than 10% of the Company's
common stock.
|
|
11.
|
These
options were exercised in full by Langer Partners, LLC, on May 14,
2001.
|
|
12.
|
The
transaction on 2/13/01 was the close of a tender offer by persons
including Langer Partners, LLC, and pursuant to an agreement with
the
Company, upon the close of the tender offer, the Company granted
such
persons, including Langer Partners, LLC, options to purchase an aggregate
of 1,400,000 shares of common stock at a price that was greater than
the market price of the common stock on the date of commencement
of the
tender offer. Immediately prior to the close of the tender offer,
the
Company was controlled by persons other than Langer Partners, LLC,
and the
close of the tender offer resulted in a change of control of Company.
The
options were exercised on 5/14/01 at a price equal to the price paid
in
the tender offer.
|
|
13.
|
All
transactions by all selling stockholders on September 30, 2004, represent
purchases of the Company's 7% senior subordinated notes due September
30,
2009. Each purchaser of such notes was also awarded warrants, at
the rate
of 1 warrant for each $50 of principal amount of notes purchased;
the
warrants are for a term expiring September 30, 2009, at an exercise
price
of $0.02 per share. The notes were prepaid in full on June 15, 2005,
and
the warrants remain outstanding in accordance with their
terms.
|
|
14.
|
Based
on shares outstanding as reported in the Company's balance sheet
as of
9/30/04 which is included in the Company's Quarterly Report on Form
10-Q
for the Quarter Ended 9/30/04.
|
|
15.
|
Determined
by excluding 2,884,715 shares of outstanding common stock held by
Langer
Partners, LLC and the directors of the Company as of 9/30/04 (
i.e.,
Messrs. Burtt R. Ehrlich, Jonathan Foster, Arthur Goldstein, Andrew
H.
Meyers, Gregory Nelson, and Thomas Strauss) and their respective
affiliates, from the total number of shares outstanding. Such persons,
including Langer Partners, LLC, and their respective affiliates,
also held
options to acquire an aggregate of 295,206 shares, and $2,600,000
of the
Company's 4% convertible notes due 8/31/06, which were convertible
at the
rate of $6.00 per share into 433,334 shares of common stock. Neither
of
these amounts of shares were included in the number of shares outstanding.
The principal of the notes was paid at maturity, without any
conversions.
|
|
16.
|
Acquirable
upon exercise of warrants sold with 7% Senior Subordinated Notes
due
September 30, 2009. The warrants were issued to the purchasers of
the
notes at the rate of 20 warrants for each $1,000 of principal of
the
notes. The exercise price of the warrants is $0.02 per share. The
7%
Senior Subordinated Notes were repaid in full on June 15,
2005.
|
|
17.
|
These
shares were issued as a conditional restricted stock award which
would
become effective if Mr. Kanders continued to serve as Chairman of
the
Board through September 1, 2005; such condition was fulfilled, and
so the
shares vested on November 12, 2007.
|
|
18.
|
These
shares are acquirable under an option awarded to Kanders & Company,
Inc., having an exercise price equal to the fair market value of
the
common stock on the date of grant. The options were awarded in connection
with a Consulting Agreement made on the date of grant between the
Company
and Kanders & Company. The options provided for vesting in three equal
consecutive annual tranches commencing on November 12, 2005. These
options
were cancelled on November 12, 2005, and options to purchase a like
number
of shares at the same exercise price were awarded to Mr. Warren B.
Kanders. See the following note.
|
|
19.
|
These
shares are acquirable under an option awarded to Kanders & Company,
Inc., having an exercise price of $7.50, and the shares were subject
to a
lock-up agreement which expired on November 12,
2007.
|
|
20.
|
The
shares acquirable under this option are subject to a lock-up agreement
which expires upon the earlier of a change of control (in which case
the
lock-up expires in full), or in three equal consecutive annual tranches
commencing April 1, 2008.
|
|
21.
|
This
is a restricted stock award under the Company's 2005 Stock Incentive
Plan
and vests in full if and when the Company achieves EBITDA of $10,000,000
in any trailing period of 4 consecutive calendar
quarters.
|
|
22.
|
The
number of shares issued in the Regal acquisition was initially set
at
379,167 shares, and was reduced by 45,684 shares on March 20, 2007,
to
333,483 shares, in accordance with certain post-closing adjustments
under
the agreement with respect to the Regal acquisition. The number of
shares
was further reduced by 25,000 shares on March 31, 2008, to a net
of
308,483 shares, which is the number of shares offered in this prospectus.
In connection with the wind-up of the business conducted by the prior
owners of Regal, the aforesaid shares were transferred to RMS Liquidating
Trust, G. Barry Wilkinson, trustee, u/t/a dated March 27,
2008.
|
The
following table sets forth certain information about the aggregate numbers
of
shares previously registered for resale by the selling stockholders and their
affiliates, and the numbers of shares registered for sale and covered by this
prospectus.
|
Shares
outstanding as of December 7, 2006, prior to issuance of 5% Convertible
Subordinated Notes due December 7, 2011, held by persons other than
the
selling stockholders, affiliates of the selling stockholders, and
affiliates of the Company
|
|
|
7,715,363
|
|
|
Shares
registered for resale by the selling stockholders and their affiliates
in
prior registration statements
|
|
|
2,660,223
|
|
|
Shares
registered for resale currently held by the selling stockholders
and their
affiliates
|
|
|
1,865,218
|
|
|
Shares
previously registered for resale by the selling stockholders and
their
affiliates that have been sold
|
|
|
0
|
|
|
Shares
registered for resale on behalf of the selling stockholders and their
affiliates in this prospectus
|
|
|
7,572,004
|
|
_______________________
|
1.
|
The
decrease in the number of shares registered for resale and the number
of
shares registered for resale and currently held is the result of
the
payment in full, on the due date, of the principal and interest of
the
Company's 4% convertible notes due August 31, 2006 (the "4% Convertible
Notes"). The selling stockholders and their affiliates held 4% Convertible
Notes that were, prior to payment of the 4% Notes, convertible into
795,005 shares of common stock.
|
PLAN
OF DISTRIBUTION
The
selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of our common stock
or interests in shares of our common stock received after the date of this
prospectus from a Selling Stockholder as a gift, pledge, partnership
distribution or other transfer, may, from time to time, sell, transfer or
otherwise dispose of any or all of their shares of our common stock or interests
in shares of our common stock on any stock exchange, market or trading facility
on which the shares are traded or in private transactions. These dispositions
may be at fixed prices, at prevailing market prices at the time of sale, at
prices related to the prevailing market price, at varying prices determined
at
the time of sale, or at negotiated prices.
|
|
·
|
market
transactions in accordance with the rules of The Nasdaq Global Market
or
any other available markets or
exchanges;
|
|
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
|
·
|
block
trades in which the broker-dealer will attempt to sell the shares
as
agent, but may position and resell a portion of the block as principal
to
facilitate the transaction;
|
|
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
|
|
|
·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
|
|
·
|
privately
negotiated transactions;
|
|
|
·
|
short
sales entered into after the date of this
prospectus;
|
|
|
·
|
writing
or settlement of options or other hedging transactions, whether through
an
options exchange or otherwise;
|
|
|
·
|
distributions
to the partners and/or members of the selling
stockholders;
|
|
|
·
|
redemptions
or repurchases of interests owned by partners and/or members of the
selling stockholders;
|
|
|
·
|
broker-dealers
may agree with the selling stockholders to sell a specified number
of such
shares at a stipulated price per
share;
|
|
|
·
|
a
combination of any such methods of sale;
and
|
|
|
·
|
any
other method permitted pursuant to applicable
law.
|
In
connection with the sale of our common stock or interests therein, the selling
stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of our common
stock in the course of hedging the positions they assume with the selling
stockholders. The selling stockholders may also sell shares of our common stock
short and deliver these securities to close out their short positions, or loan
or pledge our common stock to broker-dealers that in turn may sell these
securities. The selling stockholders may also enter into option or other
transactions with broker-dealers or other financial institutions or the creation
of one or more derivative securities which require the delivery to such
broker-dealer or other financial institution of shares offered by this
prospectus, which shares such broker-dealer or other financial institution
may
resell pursuant to this prospectus (as supplemented or amended to reflect such
transaction).
Short
selling occurs when a person sells shares of stock which the person does not
yet
own and promises to buy stock in the future to cover the sale. The general
objective of the person selling the shares short is to make a profit by buying
the shares later, at a lower price, to cover the sale. Significant amounts
of short selling, or the perception that a significant amount of short sales
could occur, could depress the market price of our common stock. In contrast,
purchases to cover a short position may have the effect of preventing or
retarding a decline in the market price of our common stock, and together with
the imposition of the penalty bid, may stabilize, maintain or otherwise affect
the market price of our common stock. As a result, the price of our common
stock
may be higher than the price that otherwise might exist in the open market.
If
these activities are commenced, they may be discontinued at any time. These
transactions may be effected on The Nasdaq Global Market or any other available
markets or exchanges.
The
aggregate proceeds to the selling stockholders from the sale of our common
stock
offered by them will be the purchase price of our common stock less discounts
or
commissions, if any. Each of the selling stockholders reserves the right to
accept and, together with their agents from time to time, to reject, in whole
or
in part, any proposed purchase of our common stock to be made directly or
through agents. We will not receive any of the proceeds from this
offering.
The
selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act,
provided that they meet the criteria and conform to the requirements of that
rule.
The
selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of our common stock or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act.
Any discounts, commissions, concessions or profits they earn on any resale
of
the shares may be underwriting discounts and commissions under the Securities
Act. Selling stockholders who are "underwriters" within the meaning of
Section 2(11) of the Securities Act will be subject to the prospectus
delivery requirements of the Securities Act.
To
the
extent required, the shares of our common stock to be sold, the names of the
selling stockholders, the respective purchase prices and public offering prices,
the names of any agents, dealers or underwriters, any applicable commissions
or
discounts with respect to a particular offer will be set forth in an
accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this
prospectus.
In
order
to comply with the securities laws of some states, if applicable, our common
stock may be sold in these jurisdictions only through registered or licensed
brokers or dealers. In addition, in some states our common stock may not be
sold
unless it has been registered or qualified for sale or an exemption from
registration or qualification requirements is available and is complied
with.
We
have
advised the selling stockholders that the anti-manipulation rules of
Regulation M under the Exchange Act may apply to sales of shares in the
market and to the activities of the selling stockholders and their
affiliates.
In
connection with this offering, some selling stockholders may also engage in
passive market making transactions in our common stock on The Nasdaq Global
Market. Passive market making consists of displaying bids on The Nasdaq Global
Market limited by the prices of independent market makers and effecting
purchases limited by those prices in response to order flow. Rule 103 of
Regulation M under the Exchange Act limits the amount of net purchases that
each passive market maker may make and the displayed size of each bid. Passive
market making may stabilize the market price of our common stock at a level
above that which might otherwise prevail in the open market and, if commenced,
may be discontinued at any time.
In
addition, we will make copies of this prospectus (as it may be supplemented
or
amended from time to time) available to the selling stockholders for the purpose
of satisfying the prospectus delivery requirements of the Securities Act. The
selling stockholders may indemnify any broker-dealer that participates in
transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.
EXPERTS
The
financial statements and schedule as of December 31, 2007 and 2006 and for
each
of the three years in the period ended December 31, 2007 incorporated by
reference in this Prospectus have been so incorporated in reliance on reports
of
BDO Seidman, LLP, an independent registered public accounting firm, incorporated
herein by reference, given on the authority of said firm as experts in auditing
and accounting.
The
financial statements and related financial statement schedule of Twincraft,
Inc., as of and for the years ended December 31, 2006, 2005, 2004 and 2003,
incorporated in this prospectus by reference from Amendment No. 1 filed
April 9, 2007, of the Company's Current Report on Form 8-K filed January 29,
2007, have been audited by Gallagher, Flynn & Company, LLP, an independent
public accounting firm, as stated in their reports, which is incorporated herein
by reference, and have been so incorporated in reliance upon the reports of
such
firm given upon their authority as experts in accounting and
auditing.
LEGAL
MATTERS
The
validity of the shares of Langer common stock offered by this prospectus will
be
passed upon by Kane Kessler, P.C., New York, New York, as counsel to
Langer.
MATERIAL
CHANGES
There
have been no material changes in our affairs since December 31, 2007, that
have
not been described in our Annual Report on Form 10-K filed March 31, 2008,
or in
the Current Reports, Quarterly Reports and Proxy Statements filed with the
Securities and Exchange Commission which are incorporated herein by
reference.
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution
The
expenses to be paid by us in connection with the distribution of the Common
Stock, par value $0.01 per share, of Langer, Inc. (the "Registrant") being
registered are as set forth in the following table:
|
Registration
Fee—Securities and Exchange Commission
|
|
$
|
3,175
|
|
|
*Legal
Fees and Expenses
|
|
|
150,000
|
|
|
*Accounting
Fees and Expenses
|
|
|
75,000
|
|
|
*Printing
Fees and Expenses
|
|
|
10,000
|
|
|
*Blue
Sky Fees
|
|
|
10,000
|
|
|
*Miscellaneous
|
|
|
10,000
|
|
|
|
|
|
|
|
|
*Total
|
|
$
|
258,175
|
|
_________________
* Estimated.
Item
15. Indemnification of Directors and Officers
We
are a
Delaware corporation. Subsection (a) of Section 145 of the General
Corporation Law of the State of Delaware (the "DGCL") empowers a corporation
to
indemnify any current or former director, officer, employee or agent of the
corporation, or any individual serving at the corporation's request as a
director, officer, employee or agent of another organization, who was or is
a
party or is threatened to be made a party 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 the corporation),
against expenses (including attorneys' fees), judgments, fines and amounts
paid
in settlement actually and reasonably incurred by the person in connection
with
such action, suit or proceeding provided that such director, officer, employee
or agent acted in good faith and in a manner he reasonably believed to be in,
or
not opposed to, the best interests of the corporation, and, with respect to
any
criminal action or proceeding, provided further that such director, officer,
employee or agent had no reasonable cause to believe his conduct was
unlawful.
Subsection
(b) of Section 145 of the DGCL empowers a corporation to indemnify any
current or former director, officer, employee or agent who was or is a party
or
is threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a judgment in its
favor
by reason of the fact that such person is or was a director, officer, employee
or agent of the corporation, or any individual serving at the corporation's
request as a director, officer, employee or agent of another organization
against expenses (including attorneys' fees) actually and reasonably incurred
by
the person in connection with the defense or settlement of such action or suit
provided that such director, officer, employee or agent acted in good faith
and
in a manner reasonably believed to be in, or not opposed to, the best interests
of the corporation, except that no indemnification may be made in respect to
any
claim, issue or matter as to which such director, officer, employee or agent
shall have been adjudged to be liable to the corporation unless and only to
the
extent that the Court of Chancery or the court in which such action or suit
was
brought shall determine upon application that, despite the adjudication of
liability but in view of all of the circumstances of the case, such director
or
officer is fairly and reasonably entitled to indemnity for such expenses which
the Court of Chancery or such other court shall deem proper.
Section 145
further provides that to the extent a present or former director or officer
has
been successful in the defense of any action, suit or proceeding referred to
in
subsections (a) and (b) of
Section 145 or in the defense of any claim, issue or matter therein, he
shall be indemnified against expenses (including attorneys' fees) actually
and
reasonably incurred by him in connection therewith; that indemnification and
advancement of expenses provided for by, or granted pursuant to,
Section 145 shall not be deemed exclusive of any other rights to which the
indemnified party may be entitled; and empowers the corporation to purchase
and
maintain insurance on behalf of a current or former director, officer, employee
or agent of the corporation, or any individual serving at the corporation's
request as a director, officer or employee of another organization, against
any
liability asserted against him or incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would have
the
power to indemnify him against such liabilities under
Section 145.
As
permitted by the DGCL, our certificate of incorporation provides that, to the
fullest extent permitted by the DGCL, no director shall be personally liable
to
us or to our stockholders for monetary damages for breach of his fiduciary
duty
as a director. Delaware law does not permit the elimination of liability
(a) for any breach of the director's duty of loyalty to us or our
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) in respect of
certain unlawful dividend payments or stock redemptions or repurchases or
(d) for any transaction from which the director derives an improper
personal benefit. The effect of this provision in the certificate of
incorporation is to eliminate our rights and the rights of our stockholders
(through stockholders' derivative suits on behalf of us) to recover monetary
damages against a director for breach of fiduciary duty as a director thereof
(including breaches resulting from negligent or grossly negligent behavior)
except in the situations described in clauses (a) - (d), inclusive,
above. These provisions will not alter the liability of directors under federal
securities laws.
We
have
also entered into separate indemnification agreements with each of our directors
and executive officers which provide significant additional protection to such
persons. In addition, we have in effect a directors and officers' liability
insurance policy indemnifying our directors and officers and the directors
and
officers of our subsidiaries within a specific limit for certain liabilities
incurred by them, including liabilities under the Securities Act. We pay the
entire premium of this policy.
We
believe that our certificate of incorporation and bylaw provisions, our
directors and officers liability insurance policy and our indemnification
agreements are necessary to attract and retain qualified persons to serve as
our
directors and officers.
Item
16. Exhibits.
|
3.2
|
Certificate
of Incorporation, incorporated herein by reference to Appendix B
of our
Definitive Proxy Statement for the Annual Meeting of Stockholders
held on
June 27, 2002, filed with the Securities and Exchange Commission
on May
31, 2002.
|
|
|
|
|
3.3
|
By-laws,
incorporated herein by reference to Appendix C of our Definitive
Proxy
Statement for the Annual Meeting of Stockholders held on June 27,
2002,
filed with the Securities and Exchange Commission on May 31,
2002.
|
|
|
|
|
4.1
|
Specimen
of Common Stock Certificate, incorporated herein by reference to
our
Registration Statement of Form S-1 (File No. 2- 87183).
|
|
|
|
|
5.2
|
Opinion
of Kane Kessler, P.C., regarding the legality of the Common Stock
being
registered (including consent).
|
|
|
|
|
10.1+
|
Employment
Agreement between Langer, Inc. and Andrew H. Meyers, dated as of
February
13, 2001, incorporated herein by reference to, Exhibit 10.6 of our
Annual
Report on Form 10-K filed on May 29, 2001 (File No.
000-12991).
|
|
|
|
|
10.2+
|
Employment
Agreement between Langer, Inc. and Steven Goldstein, dated as of
November
15, 2004, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.3+
|
Consulting
Agreement between Langer, Inc. and Kanders & Company, Inc., dated
November 12, 2004, incorporated herein by reference to our Registration
Statement on Form S-1 (File No. 333-120718) filed with the Securities
and
Exchange Commission on November 23, 2004.
|
|
|
|
|
10.4+
|
Option
Agreement between Langer, Inc. and Kanders & Company, Inc., dated
February 13, 2001, incorporated herein by reference to Exhibit (d)(1)(G)
to the Schedule TO (File Number 005-36032).
|
|
|
|
|
10.5
|
Registration
Rights Agreement between Langer, Inc. and Kanders & Company, Inc.,
dated February 13, 2001, incorporated herein by reference to Exhibit
(d)(1)(I) to the Schedule TO (File Number 005-36032).
|
|
|
|
|
10.6
|
Indemnification
Agreement between Langer, Inc. and Kanders & Company, Inc., dated
February 13, 2001, incorporated herein by reference to Exhibit (d)(1)(J)
to the Schedule TO (File Number 005-36032).
|
|
|
|
|
10.7+
|
The
Company’s 2001 Stock Incentive Plan incorporated herein by reference to
Exhibit 10.18 of our Annual Report on Form 10-K for the fiscal year
ended
December 31, 2001.
|
|
|
|
|
10.8
|
Langer
Biomechanics Group Retirement Plan, restated as of July 20, 1979
incorporated by reference to our Registration Statement of Form S-1
(File
No. 2-87183).
|
|
|
|
|
10.9
|
Agreement,
dated March 26, 1992, and effective as of March 1, 1992, relating
to our
401(k) Tax Deferred Savings Plan incorporated by reference to our
Form
10-K for the fiscal year ended February 29, 1992.
|
|
|
|
|
10.10
|
Form
of Indemnification Agreement for Langer, Inc.’s executive officers and
directors, incorporated by reference to Exhibit 10.23 of our Annual
Report
on Form 10-K for the fiscal year ended February 28,
2001.
|
|
|
|
|
10.11
|
Copy
of Lease related to Langer, Inc.’s Deer Park, NY facilities incorporated
by reference to Exhibit 10(f) of our Annual Report on Form 10-K for
the
fiscal year ended February 28, 1993.
|
|
|
|
|
10.12
|
Copy
of Amendment to Lease of Langer, Inc.’s Deer Park, NY facility dated
February 19, 1999, incorporated herein by reference to Amendment
No. 2 of
our Registration Statement on Form S-1 (File No. 333-120718), filed
with
the Securities and Exchange Commission on February 11,
2005.
|
|
|
|
|
10.13
|
Asset
Purchase Agreement, dated May 6, 2002, by and among Langer, Inc.,
GoodFoot
Acquisition Co., Benefoot, Inc., Benefoot Professional Products,
Inc.,
Jason Kraus, and Paul Langer, incorporated herein by reference to
Exhibit
2.1 of our Current Report on Form 8-K filed with the Securities and
Exchange Commission on May 13, 2002.
|
|
|
|
|
10.14
|
Registration
Rights Agreement, dated May 6, 2002, among Langer, Inc., Benefoot,
Inc.,
Benefoot Professional Products, Inc., and Dr. Sheldon Langer, incorporated
herein by reference to Exhibit 10.1 of our Current Report on Form
8-K,
filed with the Securities and Exchange Commission on May 13,
2002.
|
|
|
|
|
10.15
|
Promissory
Note, dated May 6, 2002, made by Langer, Inc. in favor of Benefoot,
Inc.,
incorporated herein by reference to Exhibit 10.2 of our Current Report
on
Form 8-K, filed with the Securities and Exchange Commission on May
13,
2002.
|
|
|
|
|
10.16
|
Promissory
Note, dated May 6, 2002, made by Langer, Inc. in favor of Benefoot
Professional Products, Inc., incorporated herein by reference to
Exhibit
10.3 of our Current Report on Form 8-K, filed with the Securities
and
Exchange Commission on May 13, 2002.
|
|
|
|
|
10.17
|
Stock
Purchase Agreement, dated January 13, 2003, by and among Langer,
Inc.,
Langer Canada Inc., Raynald Henry, Micheline Gadoury, 9117-3419 Quebec
Inc., Bi-Op Laboratories Inc., incorporated herein by reference to
Exhibit
2.1 of our Current Report on Form 8- K filed with the Securities
and
Exchange Commission on January 13, 2003.
|
|
|
|
|
10.18+
|
Employment
Agreement between Langer, Inc. and Joseph Ciavarella dated as of
February
16, 2004, incorporated herein by reference to Exhibit 10.33 of our
Annual
Report on Form 10-K for the year ended December 31,
2003.
|
|
|
|
|
10.19+
|
Option
Agreement between Langer, Inc. and Joseph P. Ciavarella dated as
of March
24, 2004, incorporated herein by reference to Exhibit 10.34 of our
Annual
Report on Form 10-K for the year ended December 31,
2003.
|
|
|
|
|
10.20
|
Stock
Purchase Agreement, dated as of September 22, 2004, by and among
Langer,
Inc., LRC North America, Inc., SSL Holdings, Inc., and Silipos, Inc.,
incorporated herein by reference to Exhibit 2.1 of our Current Report
on
Form 8-K filed with the Securities and Exchange Commission on October
6,
2004.
|
|
|
|
|
10.21
|
Stock
Pledge and Agency Agreement, dated September 30, 2004, by and among
Langer, Inc., SSL Holdings, Inc., and Pepper Hamilton LLP., incorporated
herein by reference to Exhibit 4.4 of our Current Report on Form
8-K filed
with the Securities and Exchange Commission on October 6,
2004.
|
|
|
|
|
10.22
|
$7,500,000
Secured Promissory Note due March 31, 2006, incorporated herein by
reference to Exhibit 4.5 of our Current Report on Form 8-K filed
with the
Securities and Exchange Commission on October 6, 2004.
|
|
|
|
|
10.24
|
$3,000,000
Promissory Note due December 31, 2009, incorporated herein by reference
to
Exhibit 4.6 of our Current Report on Form 8-K filed with the Securities
and Exchange Commission on October 6, 2004.
|
|
|
|
|
10.25
|
Note
and Warrant Purchase Agreement, dated September 30, 2004, by and
among
Langer, Inc., and the investors named therein, incorporated herein
by
reference to Exhibit 4.1 of our Current Report on Form 8-K filed
with the
Securities and Exchange Commission on October 6, 2004.
|
|
|
|
|
10.26
|
Form
of 7% Senior Subordinated Note due September 30, 2007, incorporated
herein
by reference to Exhibit 4.2 of our Current Report on Form 8-K filed
with
the Securities and Exchange Commission on October 6,
2004.
|
|
|
|
|
10.27
|
Form
of Warrant to purchase shares of the common stock of Langer, Inc.,
incorporated herein by reference to Exhibit 4.3 of our Current Report
on
Form 8-K filed with the Securities and Exchange Commission on October
6,
2004.
|
|
|
|
|
10.28+
|
Employment
Agreement between Langer, Inc. and W. Gray Hudkins, dated as of November
15, 2004, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.29+
|
Amendments
dated as of November 12, 2004, October 28, 2004, September 31, 2004,
May
28, 2004, March 30, 2004, January 30, 2004 and December 1, 2003,
to
Employment Agreement dated as of February 13, 2001, between us and
Andrew
H. Meyers, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.30+
|
Stock
Option Agreement between Langer, Inc. and W. Gray Hudkins, dated
November
12, 2004, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.31+
|
Stock
Option Agreement between Langer, Inc. and Steven Goldstein, dated
November
12, 2004, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.32+
|
Restricted
Stock Agreement between Langer, Inc. and W. Gray Hudkins, dated November
12, 2004, incorporated herein by reference to our Registration Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.33
|
Supply
Agreement, dated as of September 20, 1999, by and between Silipos,
Inc.,
and Poly-Gel, L.L.C. incorporated by reference to Exhibit 10.1 to
our
Quarterly Report on Form 10-Q for the nine months ended September
30,
2004, incorporated herein by reference to our Registration Statement
on
Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.34
|
Form
of 4% Convertible Subordinated Note due September 31, 2006, incorporated
by reference to Exhibit 99.3 of our Current Report on Form 8-K Filed
with
the Securities and Exchange Commission on November 13,
2001.
|
|
|
|
|
10.35
|
Letter
Agreement dated October 31, 2001, between Langer Partners, LLC and
Oracle
Management, incorporated herein by reference to our Registration
Statement
on Form S-1 (File No. 333-120718) filed with the Securities and Exchange
Commission on November 23, 2004.
|
|
|
|
|
10.36
|
Stock
Option Agreement between Langer, Inc. and Kanders & Company, Inc.
dated November 12, 2004, incorporated herein by reference to our
Registration Statement on Form S-1 (File No. 333-120718) filed with
the
Securities and Exchange Commission on November 23,
2004.
|
|
|
|
|
10.37
|
Patent
License Agreement, including amendment no. 1 thereto, between Applied
Elastomerics, Inc. and SSL Americas, Inc., dated effective November
30,
2001, incorporated herein by reference to the Company’s Annual Report on
Form 10-K for the year ended December 31, 2004, filed with the Commission
on 3/30/05, Exhibit 10.41.
|
|
|
|
|
10.38
|
Assignment
and Assumption Agreement, dated as of September 30, 2004, by and
between
SSL Americas, Inc. and Silipos, Inc., incorporated herein by
reference to the Company’s Annual Report on Form 10-K for the year ended
December 31, 2004, filed with the Commission on 3/30/05, Exhibit
10.42.
|
|
|
|
|
10.39
|
License
Agreement, dated as of January 1, 1997, by and between Silipos, Inc.
and
Gerald P. Zook, incorporated herein by reference to the Company’s Annual
Report on Form 10-K for the year ended December 31, 2004, filed with
the
Commission on 3/30/05, Exhibit
10.43.
|
|
10.40
|
Copy
of Lease between 366 Madison Inc. and Silipos, Inc., dated April,
1995;
Lease Modification and Extension Agreement, dated November 1, 1995;
and
Second Lease Modification and Extension Agreement, dated December
16,
1997, incorporated herein by reference to the Company’s Annual Report on
Form 10-K for the year ended December 31, 2004, filed with the Commission
on 3/30/05, Exhibit 10.44.
|
|
|
|
|
10.41
|
Copy
of Sublease between Calamar Enterprises, Inc. and Silipos, Inc.,
dated May
21, 1998; First Amendment to Sublease between Calamar Enterprises,
Inc.
and Silipos, Inc., dated July 15, 1998; and Second Amendment to Sublease
between Calamar Enterprises, Inc. and Silipos, Inc., dated March
1, 1999,
incorporated herein by reference to the Company’s Annual Report on Form
10-K for the year ended December 31, 2004, filed with the Commission
on
3/30/05, Exhibit 10.45.
|
|
|
|
|
10.42
|
Lease
dated December 19, 2005, between the Company (as tenant) and 41 Madison,
L.P., of office space at 41 Madison Avenue, New York, N.Y., incorporated
herein by reference to the Exhibit 10.1 of the Company’s Current Report on
Form 8-K filed December 22, 2005.
|
|
|
|
|
10.43
|
Form
of Amendment to Stock Option Agreement, incorporated herein by reference
to the Exhibit 10.1 of the Company’s Current Report on Form 8-K filed
December 27, 2005.
|
|
|
|
|
10.45
|
Form
of Amendment to Restricted Stock Award Agreement, incorporated herein
by
reference to the Exhibit 10.2 of the Company’s Current Report on Form 8-K
filed December 27, 2005.
|
|
|
|
|
10.46+
|
Employment
Agreement dated as of September 18, 2006, between the Company and
Sara
Cormack, incorporated herein by reference to the Exhibit 10.2 of
the
Company’s Current Report on Form 8-K filed September 18,
2006.
|
|
|
|
|
10.47
|
Form
of Note Purchase Agreement dated as of December 7, 2006, among the
Company
and the purchasers of the Company’s 5% Convertible Notes Due December 7,
2011, including letter amendment dated as of December 7, 2006, without
exhibits, incorporated herein by reference to the Exhibit 10.1 of
the
Company’s Current Report on Form 8-K filed December 14,
2006.
|
|
|
|
|
10.48
|
Form
of the Company’s 5% Convertible Note Due December 7, 2011, incorporated
herein by reference to the Exhibit 10.2 of the Company’s Current Report on
Form 8-K filed December 14, 2006.
|
|
|
|
|
10.49
|
Registration
Rights Agreement dated as of January 8, 2007, by and between Langer,
Inc.,
and Regal Medical Supply, LLC, incorporated herein by reference to
the
Exhibit 10.1 of the Company’s Current Report on Form 8-K filed January 12,
2007.
|
|
|
|
|
10.50
|
Asset
Purchase Agreement dated as December 15, 2006, by and among Langer,
Inc.,
Regal Acquisition Co., Regal Medical Supply, LLC, John Eric Shero,
William
Joseph Warning, John P Kenney, Richard Alan Nace, Linda Ann Lee,
Carl
David Ray, and Roy Kelley, incorporated herein by reference to the
Exhibit
10.2 of the Company’s Current Report on Form 8-K filed January 12,
2007.
|
|
|
|
|
10.51
|
Registration
Rights Agreement dated as of January 23, 2007, by and between the
Company,
Peter A. Asch, Richard D. Asch, A. Lawrence Litke, and Joseph M.
Candido,
incorporated herein by reference to the Exhibit 10.1 of the Company’s
Current Report on Form 8-K filed January 29, 2007.
|
|
|
|
|
10.52+
|
Employment
Agreement dated January 23, 2007, between Twincraft, Inc. and Peter
A.
Asch, incorporated herein by reference to the Exhibit 10.2 of the
Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
10.53+
|
Employment
Agreement dated January 23, 2007, between Twincraft, Inc. and A.
Lawrence
Litke, incorporated herein by reference to the Exhibit 10.3 of the
Company’s Current Report on
Form
8-K filed January 29, 2007.
|
|
|
|
|
10.54+
|
Employment
Agreement dated January 23, 2007, between Twincraft, Inc. and Richard.
Asch, incorporated herein by reference to the Exhibit 10.4 of the
Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
|
|
|
10.55+
|
Consulting
Agreement dated January 23, 2007, between Twincraft, Inc. and Fifth
Element LLC, incorporated herein by reference to the Exhibit 10.5
of the
Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
|
|
|
10.56
|
Lease
Agreement dated January 23, 2007, between Twincraft, Inc. and Asch
Partnership, incorporated herein by reference to the Exhibit 10.6
of the
Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
|
|
|
10.57
|
Lease
dated October 1, 2003 and as amended January 23, 2006, between Twincraft,
Inc. and Asch Enterprises, LLC, incorporated herein by reference
to the
Exhibit 10.7 of the Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
|
|
|
10.58
|
Stock
Purchase Agreement dated as of November 14, 2006, by and among Langer,
Inc., Peter A. Asch, Richard D. Asch, A. Lawrence Litke, and Joseph
M.
Candido, incorporated herein by reference to the Exhibit 10.8 of
the
Company’s Current Report on Form 8-K filed January 29,
2007.
|
|
|
|
|
10.59
|
Employment
Agreement dated as of January 16, 2006, between the Company and Kathryn
P.
Kehoe, incorporated herein by reference to Exhibit 10.59 to our Annual
Report on Form 10-K for the year ended December 31, 2006, filed on
April
2, 2007.
|
|
|
|
|
10.60
|
Loan
and Security Agreement dated as of May 11, 2007, between Wachovia
Bank,
National Association, and Langer, Inc., Silipos, Inc., Regal Medical,
Inc., and Twincraft, Inc., incorporated herein by reference to Exhibit
10.1 of the Company's Current Report on Form 8-K filed May 15,
2007.
|
|
|
|
|
10.61+
|
Employment
Agreement dated as of July 26, 2007, between the Company and Kathleen
P.
Bloch, incorporated herein by reference to Exhibit 10.1 of the Company's
Current Report on Form 8-K filed July 27, 2007.
|
|
|
|
|
10.62+
|
Employment
Agreement dated as of October 1, 2007, between the Company and W.
Gray
Hudkins, incorporated herein by reference to Exhibit 10.1 of the
Company's
Current Report on Form 8-K filed with the Commission October 12,
2007.
|
|
|
|
|
10.63
|
Amendment
dated June 21, 2007, to Loan and Security Agreement dated as of May
11,
2007, between Wachovia Bank, National Association, and Langer, Inc.,
Silipos, Inc., Regal Medical, Inc., and Twincraft, Inc., incorporated
herein by reference to Exhibit 10.63 of the Registrant’s Annual Report on
Form 10-K for the year ended December 31, 2007.
|
|
|
|
|
10.64
|
Amendment
No. 2 dated as of October 1, 2007, to Loan and Security Agreement
dated as
of May 11, 2007, between Wachovia Bank, N.A., and Langer, Inc., Silipos,
Inc., Regal Medical, Inc., and Twincraft, Inc., incorporated herein
by
reference to Exhibit 10.64 of the Registrant’s Annual Report on Form 10-K
for the year ended December 31, 2007, filed with the Commission on
March
31, 2008.
|
|
|
|
|
10.65+
|
Form
of Indemnification Agreement between the Company and each director
and
executive officer, incorporated herein by reference to Exhibit 10.65
of
the Registrant’s Annual Report on Form 10-K for the year ended December
31, 2007, filed with the Commission on March 31, 2008.
|
|
|
|
|
10.66+
|
The
Company’s 2005 Stock Incentive Plan, incorporated herein by reference to
Appendix A of the Company’s Proxy Statement with respect to the 2005
Annual Meeting of Stockholders, filed with the Commission on May
26,
2005.
|
|
|
|
|
10.67+
|
The
Company’s 2007 Stock Incentive Plan, incorporated herein by reference to
Appendix A of the Company’s Proxy Statement with respect to the 2007
Annual Meeting of Stockholders, filed with the Commission on May
24,
2007.
|
|
|
|
|
10.68
|
Amendment
No. 3 dated as of April 16, 2008, to Loan and Security Agreement
dated as
of May 11, 2007, between Wachovia Bank, N.A., and Langer, Inc., Silipos,
Inc., Regal Medical Supply, LLC, and Twincraft, Inc., incorporated
herein
by reference to Exhibit 10.1 of the Registrant’s Current Report on Form
8-K dated April 16, 2008.
|
|
|
|
|
21.1
|
Subsidiaries
of the Registrant, incorporated herein by reference to Exhibit 21.1
of the
Registrant’s Annual Report on Form 10-K for the year ended December 31,
2007.
|
|
|
|
|
23.1
|
Consent
of BDO Seidman, LLP.
|
|
|
|
|
23.2
|
Consent
of Gallagher, Flynn & Company, LLP.
|
|
|
|
|
23.3
|
Consent
of Kane Kessler, P.C. (included in Exhibit 5.2).
|
|
|
|
|
24.1
|
Power
of Attorney - Kathleen P. Bloch as principal, to W. Gray Hudkins
as
Attorney-in-Fact (filed with Amendment No. 1 of this Registration
Statement).
|
|
|
|
|
24.2
|
Power
of Attorney - Peter A. Asch as principal, to W. Gray Hudkins as
Attorney-in-Fact.
|
__________________________
+
This
exhibit represents a management contract or compensation plan.
Item
17. Undertakings.
1.
The
undersigned Registrant hereby undertakes:
|
|
(a)
|
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;
|
|
|
(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 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;
|
|
|
|
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;
|
|
|
(b)
|
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; and
|
|
|
(c)
|
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.
|
2.
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.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Deer Park, State of
New
York, on this 16
th
day of
April, 2008.
|
|
Langer,
Inc.
|
|
|
|
|
|
By:
|
/s/
W. Gray Hudkins
|
|
|
|
W.
Gray Hudkins
|
|
|
|
President
and Chief Executive Officer
|
|
|
|
|
|
|
By:
|
/s/
Kathleen P. Bloch
|
|
|
|
Kathleen
P. Bloch
|
|
|
|
Vice
President and Chief Financial
Officer
|
Pursuant
to the requirements of the Securities Act of 1933, as amended, this registration
statement has been signed by the following persons in the capacities and on
the
dates indicated:
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
/s/
W. Gray Hudkins
|
|
President,
Chief Executive Officer
|
|
April
18, 2008
|
|
W.
Gray Hudkins
|
|
(principal
executive officer) and Director
|
|
|
|
|
|
|
|
|
|
/s/
Kathleen P. Bloch
|
|
Vice
President and Chief Financial
|
|
April
18, 2008
|
|
Kathleen
P. Bloch
|
|
Officer
(principal financial and accounting officer)
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
April
18, 2008
|
|
Warren
B. Kanders
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
April
18, 2008
|
|
Peter
A. Asch
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
April
18, 2008
|
|
Stephen
M. Brecher
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
April
18, 2008
|
|
Burtt
R. Ehrlich
|
|
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
April
18, 2008
|
|
Stuart
P. Greenspon
|
|
|
|
|
|
|
By:
|
/s/
W. Gray Hudkins, Attorney-in-Fact
|
|
|
|
|
W.
Gray Hudkins, Attorney-in-Fact
|
|
Exhibit
Index
|
Exhibit
No.
|
Description
|
|
5.2
|
Opinion
of Kane Kessler, P.C., regarding the legality of the Common Stock
being
registered (including consent).
|
|
23.1
|
Consent
of BDO Seidman, LLP.
|
|
23.2
|
Consent
of Gallagher, Flynn & Company, LLP.
|
|
23.3
|
Consent
of Kane Kessler, P.C. (included in Exhibit 5.2).
|
|
24.2
|
Power
of Attorney - Peter A. Asch as principal, to W. Gray Hudkins as
Attorney-in-Fact.
|
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