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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) September 1, 2000
PHARMOS CORPORATION
(Exact name of Registrant as Specified in its Charter)
Nevada 0-11550 36-3207413
(State or Other Jurisdiction (Commission file Number) (IRS Employer of
Incorporation) Identification No.)
99 Wood Avenue South, Suite 301, Iselin, New Jersey 08830
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (732) 452-9556
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Item 5. Other
On September 1, 2000, the Registrant concluded two separate private
transactions with a group of investors. In one transaction, the Registrant
issued $8 million in 6% convertible debentures due February 28, 2002, and
warrants exercisable for shares of common stock, for which the Registrant
received $4 million in gross proceeds, with another $4 million being held in
escrow to be released as the debentures are converted and in certain other
circumstances. In the other transaction, the Registrant sold $3 million in
common equity plus warrants exercisable for shares of common stock. The proceeds
of the transactions will be used to fund the Registrant's research and
development activities, in particular, to complete the development of
dexanabinol for traumatic brain injury (TBI), to commence clinical trials of
dexanabinol for stroke and to accelerate the Registrant's development of its
dexanabinol analog program for central nervous system (CNS) and other
inflammation-related indications.
The 6% convertible debentures are convertible into shares of common stock
of the Registrant at a fixed price equal to 105% of an average market price
during a period before and after closing. Up to 50% of the original principal
amount of the debentures may be converted into shares of common stock during any
30-day period. The common stock is being issued at 100% of the market price as
determined during the same period, subject to a possible one-time adjustment
based on average pricing during two consecutive 15-day periods within the first
90 days following registration of the shares. One of the investors also has the
right, exercisable for 12 months, to purchase up to $2 million in additional
common stock if the market price of the common stock at the time of exercise
exceeds the average market price at the initial closing. Two private placement
agents received compensation in connection with the transactions.
Exhibits
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4.1 Purchase Agreement between the Registrant, Millennium Partners LP, Strong
River Investments Inc. and St. Albans Partners Ltd., dated as of
September 1, 2000.
4.2 Form of 6% convertible debenture due February 28, 2002.
4.3 Registration Rights Agreement between the Registrant, Millennium Partners
LP, Strong River Investments Inc. and St. Albans Partners Ltd., dated as
of September 1, 2000.
4.4 Form of Common Stock Purchase Warrant exercisable until September 1,
2005.
4.5 Escrow Agreement between the Registrant, Millennium Partners LP, Strong
River Investments Inc., St. Albans Partners Ltd. and Kleinberg Kaplan
Wolff & Cohen PC, dated as of September 1, 2000.
4.6 Common Stock Investment Agreement between the Registrant, Millennium
Partners LP, Strong River Investments Inc. and Laterman & Co. LP, dated
as of September 1, 2000.
4.7 Registration Rights Agreement between the Registrant, Millennium Partners
LP, Strong River Investments Inc. and Laterman & Co. LP, dated as of
September 1, 2000.
4.8 Form of Common Stock Adjustment Warrant exercisable until November 1,
2001.
4.9 Form of Call Warrant exercisable until September 1, 2001.
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4.10 Form of Optional Adjustment Warrant exercisable until February 28, 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized on this 8th day of September, 2000.
PHARMOS CORPORATION
By: /s/ Robert W. Cook
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Name: Robert W. Cook
Title: Chief Financial Officer
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