SEC Company Response from MILESTONE SCIENTIFIC INC. (MLSS) (CIK 0000855683) (MLSS) — Nov 1, 2005
MILESTONE SCIENTIFIC INC. (MLSS) (CIK 0000855683)
Date: Nov. 1, 2005 · CIK: 0000855683 · Accession: 0000950136-05-006831
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-127728
Referenced dates: September 9, 2005
Letter
WRITER'S DIRECT LINE (212) 838-8040 October 31, 2005 United States Securities and Exchange Commission Mail Stop 6010 Washington, D.C. 20549 ATTENTION: MR. JAY MUMFORD
Re: Milestone Scientific Inc. Amendment No. 1 to Registration Statement on Form S-3 Filed September 29, 2005 File No. 333-127728
Dear Sirs and Mesdames
This letter responds to the Staff's comment letter dated October 12 regarding the above-referenced Registration Statement filed by Milestone Scientific Inc. ("Company" or "Milestone"). For ease of reference, your inquiries have been incorporated in this letter and precede our responses. If you have any questions regarding the responses to your comments, please feel free to call me at the number indicated above or Virginia Tillyard of Morse, Zelnick, Rose & Lander at 212-838-3089.
General -------
1. We note your response to our comment 1 from our letter dated September 9, 2005. We understand that you will be removing the 30,675 warrants from this registration statement.
YOUR UNDERSTANDING IS CORRECT AND WE HAVE REMOVED THE WARRANTS FROM THE SECURITIES COVERED BY THIS REGISTRATION STATEMENT.
2. We note your response to our comment 1 regarding the shares underlying the 202,088 warrants being previously registered.
o Please explain you reasons for not registering the warrants at the same time you registered the shares underlying those warrants.
MILESTONE DID NOT INITIALLY SEEK TO REGISTER THE WARRANTS SINCE IT WISHED THE INVESTORS TO BE LIMITED TO REALIZING A PROFIT ON THE WARRANTS THROUGH THEIR EXERCISE OF THE WARRANTS (PROVIDING MONEY TO MILESTONE) AND SALE OF THE UNDERLYING SHARES.
o Please describe any consideration received by the company for registering the warrants at this time.
NO ADDITIONAL CONSIDERATION HAS BEEN RECEIVED BY THE COMPANY FOR REGISTERING THE WARRANTS AT THIS TIME. HOWEVER, MILESTONE LEARNED THAT ONE OF THE LARGE INVESTORS IN THE MARCH PRIVATE PLACEMENT DID NOT UNDERSTAND THAT MILESTONE WAS COMMITTING ONLY TO REGISTERING THE UNDERLYING SHARES AND NOT THE WARRANTS THEMSELVES AND THAT THOSE WARRANTS WERE NOT IN THE FORM OF THE MILESTONE'S PUBLICLY TRADED WARRANTS EVEN THOUGH THE ECONOMIC TERMS THEREOF WERE IDENTICAL. RATHER THAN HAVE A CONTROVERSY WITH THIS INVESTOR AND THEREBY CREATE ILL-WILL WITH A RECENT MAJOR INVESTOR IN ITS SECURITIES AND A POTENTIAL INVESTOR IN ADDITIONAL OFFERINGS MILESTONE AGREED TO ISSUE THE PUBLICLY TRADED WARRANTS IN REPLACEMENT FOR THE NON-PUBLIC WARRANTS PREVIOUSLY ISSUED. AS A MATTER OF FAIRNESS IT DECIDED TO TREAT ALL THE OTHER INVESTORS IN THE MARCH PLACEMENT IN A SIMILAR MANNER.
o Please confirm to us whether (i) any sales of the warrants from original purchasers or (ii) any exercises of the warrants into common stock have occurred.
NONE OF THE WARRANTS HAVE BEEN SOLD BY THE ORIGINAL PURCHASERS NOR HAVE ANY WARRANTS BEEN EXERCISED FOR COMMON STOCK.
o Please provide us a detailed analysis as to whether any of the holders of the warrants or underlying common stock have offered their shares in violation of section 5 of the Securities Act.
NONE OF THE HOLDERS OF THE WARRANTS OR UNDERLYING COMMON STOCK HAVE OFFERED THEIR SHARES IN VIOLATION OF [SS].5 OF THE SECURITIES ACT.
o We understand that you will be replacing the warrant certificates. Please provide us your analysis of whether the transaction is subject to the rules governing exchange offers.
THE ISSUANCE OF THE REPLACEMENT WARRANTS IS NOT AN EXCHANGE OF SECURITIES BUT A CORRECTION OF A MUTUAL MISTAKE OR LACK OF UNDERSTANDING. EVEN IF REGARDED AS A EXCHANGE THAT EXCHANGE WOULD BE EXEMPT UNDER [SS].4(2), 4(6), REGULATION D AND 3(A)(9).
o It appears that you intend to include warrants in one registration statement and the underlying shares in another registration statement. Please tell us whether you intend to deliver the prospectus from each registration statement in connection with the transactions involving those securities. If so, please tell us why you elected to use two prospectuses and how you will ensure that investors will not be confused by your approach.
THE DELIVERY REQUIREMENTS FOR THE PROSPECTUS WILL BE SATISFIED THROUGH THE DELIVERY OF A PROSPECTUS TO THE AMERICAN STOCK EXCHANGE FOR ALL TRANSACTIONS WHICH ARE LIKELY TO OCCUR. FURTHER, WE WILL ADVISE THE INSTITUTIONS INVOLVED THAT IF THE WARRANTS ARE SOLD IN AN OFF-MARKET TRANSACTION THEN THEY WILL BE REQUIRED TO DELIVER BOTH PROSPECTUSES. SINCE EACH PROSPECTUS IS LARGELY AN INCORPORATION BY REFERENCE DOCUMENT AND THE DOCUMENTS INCORPORATED BY REFERENCE ARE THE SAME, WE DO NOT BELIEVE THAT THERE IS ANY LIKELIHOOD THAT INVESTORS WILL BE CONFUSED.
Signatures ----------
3. Please file the dated power of attorney that authorized the attorney in fact to sign this registration statement.
THE POWER OF ATTORNEY THAT AUTHORIZED THE ATTORNEY IN FACT TO SIGN THIS REGISTRATION STATEMENT WAS INCLUDED ON THE SIGNATURE PAGE OF THE FIRST FILING OF THIS REGISTRATION STATEMENT. IN ACCORDANCE WITH YOUR COMMENT WE HAVE REFILED THIS SEPARATE DATED SIGNATURE PAGE AS AN EXHIBIT TO AMENDMENT NO. 2
Very truly yours,
/s/ Stephen A. Zelnick
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CORRESP
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filename1.htm
MORSE, ZELNICK, ROSE & LANDER
A LIMITED LIABILITY PARTNERSHIP
405 PARK AVENUE
NEW YORK, NEW YORK 10022-4405
212 838 1177
FAX 212 838 9190
WRITER'S DIRECT LINE
(212) 838-8040
October 31, 2005
United States Securities and Exchange Commission
Mail Stop 6010
Washington, D.C. 20549
ATTENTION: MR. JAY MUMFORD
Re: Milestone Scientific Inc.
Amendment No. 1 to Registration Statement on Form S-3
Filed September 29, 2005
File No. 333-127728
Dear Sirs and Mesdames
This letter responds to the Staff's comment letter dated October 12
regarding the above-referenced Registration Statement filed by Milestone
Scientific Inc. ("Company" or "Milestone"). For ease of reference, your
inquiries have been incorporated in this letter and precede our responses. If
you have any questions regarding the responses to your comments, please feel
free to call me at the number indicated above or Virginia Tillyard of Morse,
Zelnick, Rose & Lander at 212-838-3089.
General
-------
1. We note your response to our comment 1 from our letter dated September
9, 2005. We understand that you will be removing the 30,675 warrants
from this registration statement.
YOUR UNDERSTANDING IS CORRECT AND WE HAVE REMOVED THE WARRANTS FROM THE
SECURITIES COVERED BY THIS REGISTRATION STATEMENT.
2. We note your response to our comment 1 regarding the shares underlying
the 202,088 warrants being previously registered.
o Please explain you reasons for not registering the warrants at the
same time you registered the shares underlying those warrants.
MILESTONE DID NOT INITIALLY SEEK TO REGISTER THE WARRANTS SINCE IT
WISHED THE INVESTORS TO BE LIMITED TO REALIZING A PROFIT ON THE
WARRANTS THROUGH THEIR EXERCISE OF THE WARRANTS (PROVIDING MONEY
TO MILESTONE) AND SALE OF THE UNDERLYING SHARES.
o Please describe any consideration received by the company for
registering the warrants at this time.
NO ADDITIONAL CONSIDERATION HAS BEEN RECEIVED BY THE COMPANY FOR
REGISTERING THE WARRANTS AT THIS TIME. HOWEVER, MILESTONE LEARNED
THAT ONE OF THE LARGE INVESTORS IN THE MARCH PRIVATE PLACEMENT DID
NOT UNDERSTAND THAT MILESTONE WAS COMMITTING ONLY TO REGISTERING
THE UNDERLYING SHARES AND NOT THE WARRANTS THEMSELVES AND THAT
THOSE WARRANTS WERE NOT IN THE FORM OF THE MILESTONE'S PUBLICLY
TRADED WARRANTS EVEN THOUGH THE ECONOMIC TERMS THEREOF WERE
IDENTICAL. RATHER THAN HAVE A CONTROVERSY WITH THIS INVESTOR AND
THEREBY CREATE ILL-WILL WITH A RECENT MAJOR INVESTOR IN ITS
SECURITIES AND A POTENTIAL INVESTOR IN ADDITIONAL OFFERINGS
MILESTONE AGREED TO ISSUE THE PUBLICLY TRADED WARRANTS IN
REPLACEMENT FOR THE NON-PUBLIC WARRANTS PREVIOUSLY ISSUED. AS A
MATTER OF FAIRNESS IT DECIDED TO TREAT ALL THE OTHER INVESTORS IN
THE MARCH PLACEMENT IN A SIMILAR MANNER.
o Please confirm to us whether (i) any sales of the warrants from
original purchasers or (ii) any exercises of the warrants into
common stock have occurred.
NONE OF THE WARRANTS HAVE BEEN SOLD BY THE ORIGINAL PURCHASERS NOR
HAVE ANY WARRANTS BEEN EXERCISED FOR COMMON STOCK.
o Please provide us a detailed analysis as to whether any of the
holders of the warrants or underlying common stock have offered
their shares in violation of section 5 of the Securities Act.
NONE OF THE HOLDERS OF THE WARRANTS OR UNDERLYING COMMON STOCK
HAVE OFFERED THEIR SHARES IN VIOLATION OF [SS].5 OF THE SECURITIES
ACT.
o We understand that you will be replacing the warrant certificates.
Please provide us your analysis of whether the transaction is
subject to the rules governing exchange offers.
THE ISSUANCE OF THE REPLACEMENT WARRANTS IS NOT AN EXCHANGE OF
SECURITIES BUT A CORRECTION OF A MUTUAL MISTAKE OR LACK OF
UNDERSTANDING. EVEN IF REGARDED AS A EXCHANGE THAT EXCHANGE WOULD
BE EXEMPT UNDER [SS].4(2), 4(6), REGULATION D AND 3(A)(9).
o It appears that you intend to include warrants in one registration
statement and the underlying shares in another registration
statement. Please tell us whether you intend to deliver the
prospectus from each registration statement in connection with the
transactions involving those securities. If so, please tell us why
you elected to use two prospectuses and how you will ensure that
investors will not be confused by your approach.
THE DELIVERY REQUIREMENTS FOR THE PROSPECTUS WILL BE SATISFIED
THROUGH THE DELIVERY OF A PROSPECTUS TO THE AMERICAN STOCK
EXCHANGE FOR ALL TRANSACTIONS WHICH ARE LIKELY TO OCCUR. FURTHER,
WE WILL ADVISE THE INSTITUTIONS INVOLVED THAT IF THE WARRANTS ARE
SOLD IN AN OFF-MARKET TRANSACTION THEN THEY WILL BE REQUIRED TO
DELIVER BOTH PROSPECTUSES. SINCE EACH PROSPECTUS IS LARGELY AN
INCORPORATION BY REFERENCE DOCUMENT AND THE DOCUMENTS INCORPORATED
BY REFERENCE ARE THE SAME, WE DO NOT BELIEVE THAT THERE IS ANY
LIKELIHOOD THAT INVESTORS WILL BE CONFUSED.
Signatures
----------
3. Please file the dated power of attorney that authorized the attorney in
fact to sign this registration statement.
THE POWER OF ATTORNEY THAT AUTHORIZED THE ATTORNEY IN FACT TO SIGN THIS
REGISTRATION STATEMENT WAS INCLUDED ON THE SIGNATURE PAGE OF THE FIRST
FILING OF THIS REGISTRATION STATEMENT. IN ACCORDANCE WITH YOUR COMMENT
WE HAVE REFILED THIS SEPARATE DATED SIGNATURE PAGE AS AN EXHIBIT TO
AMENDMENT NO. 2
Very truly yours,
/s/ Stephen A. Zelnick
Stephen A. Zelnick