Filed Pursuant to Rule 424(b)(2)
Registration Statement No. 333-64444
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED OCTOBER 19, 2001)
NEOTHERAPEUTICS, INC.
COMMON STOCK
You should read this prospectus supplement and the accompanying
prospectus carefully before you invest. Both documents contain information you
should consider when making your investment decision. The information included
in the registration statement on Form S-3 (No. 333-64444) filed with the
Securities and Exchange Commission, as amended, is hereby incorporated by
reference into this prospectus supplement.
Our common stock is traded on the Nasdaq National Market under the
symbol "NEOT."
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INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" BEGINNING ON PAGE 3 OF THE PROSPECTUS DATED OCTOBER 19, 2001 TO
READ ABOUT FACTORS YOU SHOULD CONSIDER BEFORE BUYING SHARES OF OUR COMMON STOCK.
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Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these securities or passed
upon the accuracy or adequacy of the prospectus. Any representation to the
contrary is a criminal offense.
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[CANTOR FITZGERALD LOGO]
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS NOVEMBER 1, 2001.
RECENT SALES OF COMMON STOCK
During the week ended October 26, 2001, Cantor Fitzgerald & Co.
effected sales as underwriter under the registration statement (No. 333-64444)
of 104,800 shares of our common stock at a weighted average price of $3.23 per
share, for aggregate gross proceeds before underwriting commission of
$338,320.92. In connection with these sales, we paid aggregate commission of
$13,531.66 to Cantor Fitzgerald & Co. The sales were effected by Cantor
Fitzgerald & Co. through the facilities of the Nasdaq National Market at the
current market price at the time such sales.
DESCRIPTION OF COMMON STOCK
The following summary of the terms of our common stock does not
purport to be complete and is subject to and qualified in its entirety by
reference to our Charter and Bylaws, copies of which are on file with the
Commission. See "Where You Can Find More Information."
We have authority to issue 50,000,000 shares of common stock,
$.001 par value per share. As of October 26, 2000, we had 21,927,372 shares of
common stock outstanding, held of record by approximately 370 stockholders.
TERMS
Holders of our common stock are entitled to one vote per share on
all matters to be voted upon by the stockholders. The holders of common stock
are not entitled to cumulative voting rights with respect to election of
directors, and as a consequence, minority stockholders will not be able to elect
directors on the basis of their shares alone. Our board of directors is divided
into three classes, with the term of each class expiring every third year at the
annual meeting of stockholders. The number of directors is distributed equally
between the three classes. Subject to the preferences that may be applicable to
the holders of outstanding shares of preferred stock, if any, the holders of our
common stock are entitled to receive ratably such lawful dividends as may be
declared by the Board of Directors. In the event of liquidation, dissolution or
winding up of NeoTherapeutics, and subject to the rights of the holders of
outstanding shares of Preferred Stock, if any, the holders of shares of our
common stock shall be entitled to receive pro rata all of our remaining assets
available for distribution to our stockholders. Our common stock has no
preemptive or conversion rights, other subscription rights, or redemption or
sinking fund provisions. All outstanding shares of our common stock are fully
paid and nonassessable. The rights, powers, preferences and privileges of
holders of our common stock are subject to, and may be adversely affected by,
the rights of the holders of shares of any series of preferred stock, if any.
CERTAIN PROVISION OF DELAWARE LAW AND OF THE COMPANY'S CHARTER AND BYLAWS
The following paragraphs summarize certain provisions of the
Delaware General Corporation Law and the Company's Charter and Bylaws. The
summary does not purport to be complete and is subject to and qualified in its
entirety by reference to the DGCL and to the Company's Charter and Bylaws,
copies of which are on file with the Commission. See "Where You Can Find More
Information."
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Our Certificate of Incorporation and Bylaws contain provisions
that, together with the ownership position of the officers, directors and their
affiliates, could discourage potential takeover attempts and make it more
difficult for stockholders to change management, which could adversely affect
the market place of our common stock.
Our Certificate of Incorporation limits the personal liability of
our directors to NeoTherapeutics and our stockholders to the fullest extent
permitted by the Delaware General Corporation Law, or DGCL. The inclusion of
this provision in our Certificate of Incorporation may reduce the likelihood of
derivative litigation against directors and may discourage or deter stockholders
or management from bringing a lawsuit against directors for breach of their duty
of care.
Our Bylaws provide that special meetings of stockholders can be
called only by the Board of Directors, the Chairman of the Board of Directors or
the Chief Executive Officer. Stockholders are not permitted to call a special
meeting and cannot require the Board of Directors to call a special meeting.
There is no right of stockholders to act by written consent without a meeting,
unless the consent is unanimous. Any vacancy on the Board of Directors resulting
from death, resignation, removal or otherwise or newly created directorships may
be filled only by vote of the majority of directors then in office, or by a sole
remaining director. Our Bylaws establish advance notice procedures with respect
to stockholder proposals and the nomination of candidates for election as
directors, except for nominations made by or at the direction of the board of
directors or a committee of the board. Our Bylaws also provide for a classified
board. See "Terms" above.
We are subject to the "business combination" statute of the DGCL,
an anti-takeover law enacted in 1988. In general, Section 203 of the DGCL
prohibits a publicly-held Delaware corporation from engaging in a "business
combination" with an "interested stockholder," for a period of three years after
the date of the transaction in which a person became an "interested
stockholder," unless:
- prior to such date the board of directors of the corporation
approved either the "business combination" or the transaction
which resulted in the stockholder becoming an "interested
stockholder,"
- upon consummation of the transaction which resulted in the
stockholder becoming an "interested stockholder," the "interested
stockholder" owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced,
excluding for purposes of determining the number of shares
outstanding those shares owned (1) by persons who are directors
and also officers and (2) employee stock plans in which employee
participants do not have the right to determine confidentially
whether shares held subject to the plan will be tendered in a
tender or exchange offer, or
- on or subsequent to such date the "business combination" is
approved by the board of directors and authorized at an annual or
special meeting of stockholders by the affirmative vote of a least
66% of the outstanding voting stock which is not owned by the
"interested stockholder."
A "business combination" includes mergers, stock or asset sales
and other transactions resulting in a financial benefit to the "interested
stockholders." An "interested stockholder" is a person who, together with
affiliates and associates, owns (or within three years, did own) 15% or more of
the corporation's voting stock. Although Section 203 permits us to elect not to
be governed by its provisions, we have not made this election. As a result of
the
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application of Section 203, potential acquirers of NeoTherapeutics may be
discouraged from attempting to effect an acquisition transaction with us,
thereby possibly depriving holders of our securities of certain opportunities to
sell or otherwise dispose of such securities at above-market prices pursuant to
such transactions.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the common stock is U.S.
Stock Transfer Corporation.
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