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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): February 3, 2005
(January 28, 2005)
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Altair Nanotechnologies Inc.
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(Exact name of registrant as specified in its charter)
Canada 1-12497 33-1084375
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(State or other (Commission File No.) (IRS Employer
jurisdiction Identification No.)
of incorporation)
204 Edison Way
Reno, Nevada 89502
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(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (775) 858-3750
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(Former Name, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations 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 230.425)
[ ] 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)
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Item 1.01 Entry into a Material Definitive Agreement.
On January 28, 2005, Altair Nanotechnologies Inc. and its wholly-owned
subsidiary Altair Nanomaterials Inc. (together, the "Company") entered into a
License Agreement (the "License Agreement") with Spectrum Pharmaceuticals, Inc.
("Spectrum"). Under the License Agreement, the Company grants Spectrum the
exclusive worldwide rights to develop, market and sell RenaZorb(TM), a potential
drug candidate for patients with kidney disease, for human therapeutic and
diagnostic applications. The License Agreement also sets forth the rights and
obligations of the parties with respect to the future development, testing and
supply of RenaZorb(TM), the pursuit of regulatory approval for RenaZorb(TM) and
rights with respect to intellectual property arising from that process, as well
as terms related to termination, dispute resolution, indemnification and other
standard matters.
In consideration of the license grant, Spectrum agreed to issue to the
Company 100,000 restricted shares of Spectrum common stock and purchased from
the Company 38,314 shares of common stock of Altair Nanotechnologies Inc. at a
purchase price of $5.22 per share, representing a 100% premium over the current
market price, as defined in the License Agreement. In addition, Spectrum has
agreed to issue to the Company an additional 100,000 restricted shares of
Spectrum common stock upon the receipt of successful animal test results meeting
certain specifications, with such results expected to be generated in the first
six months of this year. Without considering discounts associated with the
purchase and sale of common stock and possible fluctuations in the value of
Spectrum common stock, the approximate value of this consideration expected to
be received in the first year is $1.3 million.
Additional, contingent consideration under the license agreement may
include the following:
o purchases of a specified dollar amount of common stock of the
Company at a premium above market price upon the reaching of
various milestones representing progress in the testing and
obtaining of regulatory approval for RenaZorb(TM);
o milestone payments upon obtaining approval to market RenaZorb(TM)
from the FDA and similar regulatory agencies in Europe and Japan;
o milestone payments as certain annual net sales targets are
reached;
o royalty payments based upon a percentage of net revenue from sales
of RenaZorb(TM) in each country (subject to adjustment for
combined products and in other circumstances) as long as patents
applicable to that country remain valid; and
o technology usage payments thereafter until generic competition
emerges.
In addition, the Company may receive manufacturing revenue if, in connection
with a right of first negotiation and related rights, it obtains the right to
supply RenaZorb(TM) to Spectrum. Assuming the testing, development and
regulatory approvals of RenaZorb(TM) proceed at the rate reasonably expected by
the Company, the aggregate value of all the first year payments and all
potential stock premiums, milestone payments and other payments to the Company
over the first 5-7 years of the License Agreement could reasonably range between
$9 million and $14 million. Assuming a drug containing Renazorb(TM) receives
timely regulatory approval, the market for phosphate controlling drugs continues
to grow at projected rates, and the product becomes a leader in the market
place, the total revenues to the Company over the life of the License Agreement
could exceed $100 million.
The term of the License Agreement expires on a country-by-country basis
upon the expiration of related patents and introduction of generic competition,
but may be terminated earlier by Spectrum without cause upon 60 days prior
notice or by either party if the other party fails to cure a material breach
within 120 days of notices. Spectrum's rights with respect to RenaZorb(TM)
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terminate if the License Agreement is terminated by Spectrum without cause or by
the Company for specified breach; in other circumstances, Spectrum retains
certain long-term rights with respect to RenaZorb(TM), as set forth in the
License Agreement.
Because most of the potential compensation under the License Agreement
is in the form of milestone payments and royalties, the value of the License
Agreement to the Company will be significant only if, among other contingencies,
each of the following events occurs:
o Future laboratory, animal and human testing indicate that products
containing RenaZorb(TM) are safe and effective;
o Spectrum obtains approval on a timely basis to market RenaZorb(TM)
products from the FDA and comparable regulatory agencies
throughout the world;
o All key patent applications related to RenaZorb(TM) are granted
and not subsequently invalidated; o RenaZorb(TM) becomes one of
the leading phosphate binding drug in the United States and other
parts of the world; and
o the market for phosphate binding drugs continues to grow at
expected rates in the United States and other parts of the world.
In addition, if all such events do occur, the value of RenaZorb(TM) of the
License Agreement could be adversely effected by subsequent events, such as the
development of a cure for kidney diseases that RenaZorb(TM) could be used to
treat, the introduction of a superior drug or technology, the subsequent
discovery of serious side affects of prolonged use of RenaZorb(TM) products or
similar events. If any of the risks identified above are realized (or if any of
the key events identified above were not to occur), the value of the License
Agreement to the Company would be limited and be significantly less than
potential amounts projected.
A copy of the License Agreement is attached hereto as Exhibit 99.1. The
summary of terms set forth above is qualified by this reference to the
definitive terms of the License Agreement.
Item 3.02 Unregistered Sales of Equity Securities
As part of the License Agreement described in Item 1.01 above, the Company has
agreed to issue, and Spectrum agreed to purchase, an aggregate of 38,314 shares
of common stock and a purchase price of $5.22 per share, or $200,000 in the
aggregate. Such shares of common stock were offered and sold in reliance upon
the exemption for sales of securities not involving a public offering, as set
forth in Section 4(2) of the Securities Act and Rule 506 promulgated under the
Securities Act based upon the following: (a) Spectrum represented and warranted
to the Company that it is an "accredited investor," as defined in Rule 501 of
Regulation D promulgated under the Securities Act and has such background,
education, and experience in financial and business matters as to be able to
evaluate the merits and risks of an investment in the securities; (b) there was
no public offering or general solicitation with respect to the offering, and
Spectrum represented and warranted that it is acquiring the securities for its
own account and not with an intent to distribute such securities; (c) Spectrum
was provided with a copy of the most recent Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K of the Company
and all other information requested by it with respect to the Company, (d)
Spectrum acknowledged that all securities being purchased are "restricted
securities" for purposes of the Securities Act, and agreed to transfer such
securities only in a transaction registered with the SEC under the Securities
Act or exempt from registration under the Securities Act; and (e) a legend will
be placed on the certificates and other documents representing each such
security stating that they are restricted and can only be transferred if
subsequently registered under the Securities Act or transferred in a transaction
exempt from registration under the Securities Act.
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Item 7.01 Regulation FD Disclosure
On January 31, 2005, the Company issued a press release announcing License
Agreement described in Item 1.01 above. The full text of the press release press
release is furnished herewith as Exhibit 99.2.
The information in Item 7.07 (including the exhibit) is furnished pursuant to
Item 7.01 and shall not be deemed to be "filed" for purposes of Section 18 of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or
otherwise subject to the liabilities of that section, nor shall it be deemed
incorporated by reference in any filing made by the Company under the Securities
Act of 1933, as amended, or the Exchange Act, except as expressly set forth by
specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
99.1 License Agreement dated January 28, 2005 with Spectrum Pharmaceuticals,
Inc. [Portions of this Exhibit have been omitted pursuant to Rule
24b-2, are filed separately with the SEC and are subject to a
confidential treatment request. ]
99.2 Press Release issued by the Company dated January 31, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Current Report on Form 8-K to be signed on
its behalf by the undersigned thereunto duly authorized.
Altair Nanotechnologies Inc.
February 3, 2005 By: /s/ Edward Dickinson
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Date Edward Dickinson, Chief Financial Officer
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