BioSpecifics Technologies Corp. Form 8-K
UNITED
STATES
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): July 28,
2006 (July
24,
2006)
BIOSPECIFICS
TECHNOLOGIES CORP.
(Exact
name of
registrant as specified in its charter)
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Delaware
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0-19879
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11-3054851
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(State
of
Incorporation)
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(Commission
File No.)
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(IRS
Employer
ID No.)
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35
Wilbur
Street, Lynbrook, NY 11563
(Address
of
Principal Executive Office) (Zip Code)
516.593.7000
(Registrant's
telephone number, including area code)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
[
] Written communications pursuant to Rule 425 under the Securities Act (17
CFR.425)
[
] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[
] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[
] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM
1.02 OTHER
EVENTS
On
July
24,
2006, BioSpecifics
Technologies Corp. (the “Company”) entered into a Settlement Agreement and
Specific Release (the “Settlement Agreement”), with Edwin H. Wegman, Thomas L.
Wegman, Bio Partners, L.P., a Delaware limited partnership (“Bio Partners”), and
Jeffrey K. Vogel (“Mr. Vogel”) to settle a dispute regarding certain loan
commitment fees purportedly due from the Company to Bio Partners under a Letter
Agreement, dated January 3, 2006, between Bio Partners and the Company (the
“Letter Agreement”), and to provide for the termination of the following
agreements (i) the $1,575,000 12% Senior Secured Convertible Note made by the
Company on June 19, 2003 for the benefit of Bio Partners, (ii) the Securities
Purchase Agreement, dated as of June 19, 2003, between the Company, Advance
Biofactures Corporation (“ABC”), and Bio Partners, (iii) the Security Agreement,
dated June 19, 2003, between the Company, ABC, and Bio Partners, (iv) the
Guaranty, dated June 19, 2003, made by ABC in favor of Bio Partners, (v) the
Pledge Agreement, dated June 19, 2003, between the Company and Bio Partners,
(vi) the Investors Rights Agreement, dated June 19, 2003, between Bio Partners
and the Company, (vii) the Intellectual Property Security Agreement, dated
as of
June 19, 2003, between ABC-NY, Bio Partners and the Company, (viii) the
Collateral Assignment of Securities, dated June 19, 2003, between the Company
and Bio Partners, (ix) the Collateral Assignment of Securities, dated June
19,
2003, between the Company and Bio Partners, (x) the Letter, dated June 12,
2003,
executed by Edwin H. Wegman and Thomas L. Wegman, (xi) the Guaranty made on
June
19, 2003 by Edwin H. Wegman in favor of Bio Partners, and (xii) the Pledge
Agreement, dated June 19, 2003, between Edwin H. Wegman and Bio Partners
(together, the “Loan/Investor Related Documents”).
Under
the Letter
Agreement referenced above, Bio Partners committed to make a loan to the Company
for up to $2 million pursuant to the terms of a definitive agreement to be
negotiated. However, the Company’s Board of Directors subsequently determined
that it was not in the best interest of the Company to borrow the funds under
the Letter Agreement and a dispute arose as to whether any payment was due
under
the Letter Agreement to Bio Partners and Mr. Vogel as a result of the Board’s
determination.
In
addition, the
Company, Edwin Wegman, Thomas Wegman, Bio Partners, and Mr. Vogel, desired
to
terminate, and release each other, under the Loan/Investor Related Documents
which were executed
in
connection with a prior loan and investment Bio Partners made to, and in, the
Company in June 2003, which loan the Company repaid on June 17,
2005.
In
order to avoid
the expense, inconvenience and distraction of litigation, the Company decided
to
amicably resolve the dispute under the Letter Agreement and to resolve certain
outstanding issues among them relating to prior investment loan documentation.
Under the terms of the Settlement Agreement, in consideration of the payment
of
certain sums to Bio Partners and Mr. Vogel in respect of the Letter Agreement,
and certain undertakings by the Company, the parties agreed to terminate, and
release each other with respect to any claims under, the Letter Agreement and
the Loan/Investor Related Documents.
most
recent Form 3
filed with the SEC, Bio Partners and Mr. Vogel beneficially owned 5.51% and
11.26%, respectively, of the Company’s issued and outstanding voting common
stock. As of the date of this filing, Mr. Vogel has informed the Company that,
as a result of interim transactions, Bio Partners and Mr. Vogel now beneficially
own 5.5% and 7.7%, respectively, of the Company’s issued and outstanding voting
common stock.
SIGNATURES
Pursuant
to the
requirements of the Securities and Exchange Act of 1934, the Company has duly
caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.
Date:
July 28,
2006
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BIOSPECIFICS
TECHNOLOGIES CORP.
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/s/
Thomas L.
Wegman
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Thomas
L.
Wegman
President
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