AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 10, 2006
REGISTRATION NO. 333-136117
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
AMENDMENT NO. 1
to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CADIZ INC.
(Exact name of registrant as specified in its charter)
DELAWARE 77-0313235
(State or jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
777 S. FIGUEROA STREET
SUITE 4250
LOS ANGELES, CALIFORNIA 90017
(213) 271-1600
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
KEITH BRACKPOOL
CHIEF EXECUTIVE OFFICER
777 S. FIGUEROA STREET
SUITE 4250
LOS ANGELES, CALIFORNIA 90017
(213) 271-1600
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
COPIES OF COMMUNICATIONS TO:
HOWARD J. UNTERBERGER, ESQ.
J. BRAD WIGGINS, ESQ.
TORRIE M. BYERS, ESQ.
STEPHAN, ORINGHER, RICHMAN, THEODORA & MILLER, P.C.
2029 CENTURY PARK EAST, SIXTH FLOOR
LOS ANGELES, CALIFORNIA 90067
(310) 557-2009
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration
Statement
If the only securities being registered on this Form are being
offered pursuant to dividend or interest reinvestment plans, please
check the following box: [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement
for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that shall
become effective upon filing with the Commission pursuant to Rule
462(e) under the Securities Act, check the following box. [ ]
If this Form is a post-effective amendment to a registration
statement filed pursuant to General Instruction I.D. filed to
register additional securities or additional classes of securities
pursuant to Rule 413(b) under the Securities Act, check the
following box. [ ]
CALCULATION OF REGISTRATION FEE
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT
TITLE OF EACH CLASS AMOUNT OFFERING AGGREGATE OF
OF SECURITIES TO BE PRICE OFFERING REGISTRATION
TO BE REGISTERED REGISTERED PER UNIT PRICE FEE
Common Stock,
Par Value $0.01
Per Share 2,221,909 SHARES(1) $19.10(2) $42,438,461.90 $4,540.92(3)
(1) This registration statement is being used to register
2,221,909 shares of common stock that are issuable to the
selling stockholders upon conversion of principal and
accrued interest under a certain outstanding convertible
loan. The shares being registered include 1,692,737 shares
attributable to the conversion of the $36,375,000 original
principal amount of the convertible loan, as well as 529,172
shares that may be issued upon the conversion of the maximum
of $11,371,290 in interest that may be accrued under the
loan during its five year term. This registration statement
shall also cover an indeterminate number of additional
shares of common stock that may become issuable by virtue of
any stock dividend, stock split, recapitalization or other
similar transaction.
(2) Estimated solely for the purpose of calculating the
registration fee, and based, pursuant to Rule 457(c), on the
average of the high and low prices of the Registrant's
common stock as reported by the Nasdaq Global Market for
July 24, 2006, which date is within five business days prior
to the initial filing date of this registration statement.
(3) The registration fee was previously paid on July 28, 2006 upon
filing of the original registration statement.
========================================================================
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH
DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL
THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY
STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME
EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF
1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
========================================================================
PROSPECTUS
----------
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. THESE SECURITIES MAY NOT BE SOLD UNTIL THE
REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION IS EFFECTIVE. THIS PRELIMINARY PROSPECTUS IS NOT AN
OFFER TO SELL NOR DOES IT SEEK AN OFFER TO BUY THESE
SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS NOT
PERMITTED.
DATED AUGUST 10, 2006, SUBJECT TO COMPLETION
CADIZ INC.
2,221,909 SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
PRINCIPAL AND ACCRUED INTEREST ON AN OUTSTANDING CONVERTIBLE LOAN
The selling stockholders identified in this prospectus may
offer from time to time up to 2,221,909 shares of common stock of
Cadiz Inc. that may be acquired by the selling stockholders upon
conversion of principal and accrued interest under a $36.375
million, five year senior secured convertible loan (the "Loan").
We have agreed to pay for expenses of the offering. We will
not receive any of the proceeds from the sale of the shares by the
selling stockholders. Our obligation to pay amounts otherwise due
under the Loan will, however, be reduced as a result of the
issuance of our Common Stock in conversion of principal and
accrued interest on the Loan.
We do not know when or how the selling stockholders intend to
sell their shares or what the price, terms or conditions of any
sales will be. The selling stockholders may offer and sell their
respective shares in transactions on the Nasdaq Global Market
(formerly the Nasdaq National Market), in negotiated transactions,
or both. These sales may occur at fixed prices that are subject
to change, at prices that are determined by prevailing market
prices, or at negotiated prices. The selling stockholders may
sell shares to or through broker-dealers, who may receive
compensation in the form of discounts, concessions or commissions
from the selling stockholders, the purchasers of the shares or
both.
Our common stock is traded on the Nasdaq Global Market under
the symbol "CDZI". On July 24, 2006, the last reported sale price
of our common stock on Nasdaq was $19.53.
----------
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK.
YOU SHOULD CAREFULLY READ AND CONSIDER THE "RISK FACTORS"
BEGINNING ON PAGE 3.
----------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE
SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this prospectus is __________, 2006.
NOTICE ABOUT FORWARD-LOOKING STATEMENTS
Information presented in this prospectus, and in other
documents which are incorporated by reference in this prospectus
under the section of this prospectus entitled "Where You Can Find
More Information," that discusses financial projections,
information or expectations about our business plans, results of
operations, products or markets, or otherwise makes statements
about future events, are forward-looking statements. Forward-
looking statements can be identified by the use of words such as
"intends," "anticipates," "believes," "estimates," "projects,"
"forecasts," "expects," "plans," and "proposes." Although we
believe that the expectations reflected in these forward-looking
statements are based on reasonable assumptions, there are a number
of risks and uncertainties that could cause actual results to
differ materially from these forward-looking statements. These
include, among others, the cautionary statements in the "Risk
Factors" section of this prospectus beginning on page 3. These
cautionary statements identify important factors that could cause
actual results to differ materially from those described in the
forward-looking statements. When considering forward-looking
statements in this prospectus, you should keep in mind the
cautionary statements in the "Risk Factors" section and other
sections of this prospectus, and other cautionary statements in
documents which are incorporated by reference in this prospectus
and listed in "Where You Can Find More Information" on page 7.
ABOUT CADIZ INC.
Our primary asset consists of three blocks of land in
eastern San Bernardino County, California totaling approximately
45,000 acres. Virtually all of this land is underlain by high-
quality groundwater resources with demonstrated potential for
various applications, including water storage and supply programs
and recreational, residential, and agricultural development. Two
of the three properties are located in proximity to the Colorado
River Aqueduct, the major source of imported water for southern
California. The third property is located near the Colorado
River.
The value of these assets derives from a combination of
projected population increases and limited water supplies
throughout southern California. In addition, most of the major
population centers in southern California are not located where
significant precipitation occurs, requiring the importation of
water from other parts of the state. We therefore believe that a
competitive advantage exists for companies that can provide high
quality, reliable, and affordable water to major population
centers.
We expect to be able to use our land assets and related water
resources to participate in a broad variety of asset development
programs, including water storage and supply, exchange, and
conservation programs with public agencies and other parties.
Our principal executive offices are located at 777 S.
Figueroa Street, Suite 4250, Los Angeles, California 90401-90017
and our telephone number is (213) 271-1600.
RISK FACTORS
An investment in shares of our common stock involves a high
degree of risk. You should carefully consider the following
factors as well as the other information contained and
incorporated by reference in this prospectus before deciding to
invest.
OUR DEVELOPMENT ACTIVITIES HAVE NOT GENERATED SIGNIFICANT
REVENUES.
At present, our development activities are focused on water
resource development at our San Bernardino County properties. We
have not received significant revenues from our development
activities to date and we do not know when, if ever, we will
receive operating revenues from our development activities. As a
result, we continue to incur a net loss from operations.
WE MAY NEVER GENERATE SIGNIFICANT REVENUES OR BECOME PROFITABLE
UNLESS WE ARE ABLE TO SUCCESSFULLY IMPLEMENT PROGRAMS TO DEVELOP
OUR LAND ASSETS AND RELATED WATER RESOURCES.
We do not know the terms, if any, upon which we may be able
to proceed with our water development programs. Regardless of
the form of our water development programs, the circumstances
under which transfers or storage of water can be made and the
profitability of any transfers or storage are subject to
significant uncertainties, including hydrologic risks of variable
water supplies, risks presented by allocations of water under
existing and prospective priorities, and risks of adverse changes
to or interpretations of U.S. federal, state and local laws,
regulations and policies. Additional risks attendant to such
programs include our ability to obtain all necessary regulatory
approvals and permits, possible litigation by environmental or
other groups, unforeseen technical difficulties, general market
conditions for water supplies, and the time gap needed to
generate significant operating revenues from such programs after
operations commence.
OUR FAILURE TO MAKE TIMELY PAYMENTS OF PRINCIPAL AND INTEREST ON
OUR INDEBTEDNESS MAY RESULT IN A FORECLOSURE ON OUR ASSETS.
Effective June 29, 2006, we entered into a new senior
secured convertible loan facility with an initial principal
balance of $36.375 million. Our assets have been put up as
collateral to secure the payment of this debt. If we cannot
generate sufficient cash flow to make timely payments of
principal and interest on this indebtedness, or if we otherwise
fail to comply with the terms of agreements governing our
indebtedness, we may default on our obligations. If we default
on our obligations, our lenders may sell off the assets that we
have put up as collateral. This, in turn, may result in a
cessation or sale of our operations.
THE ISSUANCE OF SHARES UNDER OUR MANAGEMENT EQUITY INCENTIVE PLAN
WILL IMPACT EARNINGS.
Under applicable accounting rules, the issuance of shares
and options under our Management Incentive Equity Plan will
result in a charge to earnings based on the value of our common
stock at the time of issue and the valuation of options at the
time of their award and will be recorded over the vesting period
in proportion to the quantities vested. Our Management Equity
Incentive Plan provides for the issuance of up to 1,472,051
shares of common stock. We have issued stock or options to
purchase stock representing 1,459,712 of the shares authorized
for issuance under this Management Equity Incentive Plan. Based
on the trading price of our common stock at the time of such
issuances, such issuances resulted in a charge to our earnings of
$16.7 million for our fiscal year ended December 31, 2005 and
will result in a further significant charge to our earnings for
our fiscal year ended December 31, 2006. The cost of
approximately 89% of the shares and options issued in our fiscal
year ended December 31, 2005 was an expense during 2005.
WE MAY NOT BE ABLE TO OBTAIN THE FINANCING WE NEED TO IMPLEMENT
OUR ASSET DEVELOPMENT PROGRAMS.
We may require additional capital to finance our operations
until such time as our asset development operations produce
revenues. We cannot assure you that our current lenders, or any
other lenders, will give us additional credit should we seek it.
If we are unable to obtain additional credit, we may engage in
further equity financings. Our ability to obtain equity
financing will depend, among other things, on the status of our
asset development programs and general conditions in the capital
markets at the time funding is sought. Any further equity
financings would result in the dilution of ownership interests of
our current stockholders.
WE ARE RESPONSIBLE FOR HAVING THE RESALE OF SHARES ISSUED UPON
CONVERSION OF THE LOAN REGISTERED WITH THE SEC WITHIN DEFINED
TIME PERIODS AND ARE SUBJECT TO ADVERSE CONSEQUENCES IF THE
SHARES ARE NOT REGISTERED WITH THE SEC WITHIN THOSE DEFINED TIME
PERIODS OR IF THE REGISTRATION OF THE SHARES DOES NOT THEREAFTER
REMAIN EFFECTIVE.
Pursuant to the Registration Rights Agreement which we
entered into as a condition to the Loan, we are obligated, by
July 31, 2006, to file the Registration Statement with the SEC
covering the resale of all shares issuable upon conversion of the
Loan. We are also obligated to cause such Registration
Statement, of which this prospectus is a part, to be declared
effective no later than September 27, 2006, or if the
Registration Statement is reviewed by the SEC, no later than
October 27, 2006. We are also required to maintain the
effectiveness of this Registration Statement for at least 180
days after it has been declared effective. We must pay to the
holders of the Loan an amount in cash equal to 0.5% of the
initial principal amount of the Loan for each 30 day period (or
portion thereof) during which any such requirements are not
satisfied. In addition, a failure of the Registration Statement
to be declared effective by December 30, 2006 will result in a
default under the Loan.
THE SALE OF SHARES COVERED BY THIS PROSPECTUS AND FUTURE SALES OF
COMMON STOCK COULD REDUCE THE MARKET PRICE OF OUR COMMON STOCK
AND DILUTE OUR FUTURE EARNINGS PER SHARE.
The registration for resale of common stock under this
prospectus increases the number of outstanding shares of our
common stock eligible for resale. The sale, or availability for
sale, of these shares could cause decreases in the market price
of our common stock, particularly in the event that a large
number of shares were sold in the public market over a short
period of time. Similarly, the perception that additional shares
of our common stock could be sold in the public market in the
future, could cause a reduction in the trading price of our
stock.
WE ARE RESTRICTED BY CONTRACT FROM PAYING DIVIDENDS AND WE DO NOT
INTEND TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.
Any return on investment on our common stock will depend
primarily upon the appreciation in the price of our common stock.
To date, we have never paid a cash dividend on our common stock.
The loan documents governing our senior secured convertible loan
facility prohibit the payment of dividends while such facilities
are outstanding. As we have a history of operating losses, we
have been unable to date to pay dividends. Even if we post a
profit in future years, we currently intend to retain all future
earnings for the operation of our business. As a result, we do
not anticipate that we will declare any dividends in the
foreseeable future.
USE OF PROCEEDS
We will not receive any proceeds from the sale by the selling
stockholders of our common stock. However, our obligation to pay
principal and accrued interest otherwise due under the Loan will
be reduced as a result of the issuance of our Common Stock upon
conversion of principal and accrued interest on the Loan.
SALES BY SELLING STOCKHOLDERS
On June 26, 2006 we, and our wholly-owned subsidiary Cadiz
Real Estate LLC, entered into a Credit Agreement with the selling
stockholders named below, as lenders, and Peloton Partners LLP, as
Administrative Agent. The transactions contemplated by this
Credit Agreement, including the issuance of the Loan, closed on
June 29, 2006. We issued the Loan in a transaction exempt from
the registration requirements of the Securities Act of 1933, as
amended, pursuant to Section 4(2) thereof.
Under the terms of the Credit Agreement, the selling
stockholders named below, acting as lenders, have invested
$36.375 million in a five year zero coupon secured convertible
loan with an initial interest rate of 5% per annum. After three
years, the interest rate will increase to 6% per annum for the
remainder of the term. At the lenders' option, $10 million of
principal and accrued interest thereon may be converted into our
common stock at $18.15 per share, and $26.375 million of
principal and accrued interest thereon may be converted into our
common stock at $23.10 per share. These conversion prices are
set for the entire term of the loan, subject only to normal
adjustments in the event of stock splits, stock dividends and
other recapitalization events, and subject to further adjustment
in the event of a change in control of the company (whereupon the
conversion price will be adjusted pursuant to a formula which
takes into account the amount of time that the loan has been
outstanding, but in no event shall the adjusted conversion price
be less than $16.50 per share). However, the application of this
change in control adjustment formula cannot result in the
issuance of a greater number of shares of common stock than the
number of shares offered by this prospectus.
The number of shares being offered by this prospectus
assumes the conversion of the full amount of the Loan on the
final five year maturity date, giving effect to all interest
accrued through that date. In the event that all or part of the
Loan is converted prior the final maturity date, the number of
shares that will actually be issued will be less than the number
of shares being offered by this prospectus.
Unless and until the approval of our stockholders is
obtained, no lender shall be able to convert principal and
accrued interest on the Loan into shares of our common stock to
the extent that after such conversion such lender would own more
than 2,264,947 shares (i.e. 19.99% of the 11,330,402 shares of
our common stock which were outstanding at the time of the Loan).
The number of shares being offered by this prospectus does not
reflect this limitation.
Pursuant to a Registration Rights Agreement entered into by
us as a condition to the closing of the transactions contemplated
by the Credit Agreement, we agreed to register the shares of our
common stock issuable upon conversion of principal and accrued
interest on the Loan at our own expense. Pursuant to that
Registration Rights Agreement we have filed with the SEC a
registration statement, of which this prospectus is a part, for
the resale of those shares.
Except as noted with respect to selling stockholders listed
in the following table, none of the selling stockholders has held
any position or office or had a material relationship with us
other than as a result of the ownership of our common stock.
The following table is based on information supplied to us by
the selling stockholders identified in the table. The table sets
forth, as to the selling stockholders identified in the table, the
number of shares of common stock that each selling stockholder
beneficially owns as of July 24, 2006, the number of shares of
common stock beneficially owned by each selling stockholder that
may be offered for sale from time to time by this prospectus and
the number of shares and percentage of common stock to be held by
each such selling stockholder assuming the sale of all the common
stock offered hereby.
We may amend or supplement this prospectus from time to time
to update the disclosures set forth herein.
SECURITIES SECURITIES PERCENTAGE
BENEFICIALLY SECURITIES BENEFICIALLY OWNERSHIP
NAME OF SELLING OWNED PRIOR TO OFFERED OWNED AFTER AFTER
STOCKHOLDER OFFERING(1) FOR SALE OFFERING(2) OFFERING(3)
--------------- -------------- ---------- ------------ ------------
PELOTON MULTI-
STRATEGY MASTER
FUND 2,264,947(4) 1,999,719(5) 1,046,640 7.7%
MILFAM II L.P. 169,273(6) 222,190(7) -0- 0.0%
----------------------------------------
(1) Except as otherwise noted herein, the number and percentage
of shares beneficially owned is determined in accordance with
Rule 13d-3 of the Exchange Act, and the information is not
necessarily indicative of beneficial ownership for any other
purpose. Under such rule, beneficial ownership includes any
shares as to which the individual has sole or shared voting power
or investment power and also any shares which the individual has
the right to acquire within 60 days of the date of this
prospectus through the exercise of any stock option or other
right. The shares listed in this column include shares
underlying the Loan which the selling stockholder has the right
to acquire within 60 days of July 24, 2006. Unless otherwise
indicated in the footnotes, each person has sole voting and
investment power, or shares such powers with his or her spouse,
with respect to the shares shown as beneficially owned.
(2) Assumes the sale of all shares of common stock offered
hereby. In the event that all or part of the Loan is converted
prior its final maturity date, the number of shares that will
actually be issued will be less than the number of shares being
offered by this prospectus.
(3) Based upon 11,330,402 shares of common stock outstanding as
of July 24, 2006 and assumes the issuance, upon conversion of the
Loan, of the maximum of 2,221,909 shares issuable upon conversion
of the Loan.
(4) Peloton Multi-Strategy Master Fund is the holder of 90% of
the Loan.
Based upon a Schedule 13G filed on July 11, 2006 with the
SEC by Peloton Multi-Strategy Master Fund, Peloton Partners
LLP (the principal investment manager for Peloton Multi-
Strategy Master Fund) and Geoffrey Grant (the Chief
Investment Officer of Peloton Partners LLP) and a Form 3
filed on July 10, 2006 with the SEC by Peloton Partners LLP.
Includes 1,046,640 shares of common stock beneficially owned
immediately prior to consummation of the Loan, 495,867
shares of common stock issuable upon conversion of
$9,000,000 in principal under the Loan at a conversion rate
of $18.15 per share and 722,440 shares of common stock
issuable upon conversion of $16,688,364 in principal under
the Loan at a conversion rate of $23.10 per share.
Does not include 781,412 shares of common stock which are
registered hereby but as to which Peloton Multi-Strategy
Master Fund was not the beneficial owner as of July 24,
2006, consisting of (i) 476,255 shares of common stock
issuable upon conversion of a maximum of $1,023,416 in
interest which may accrue in favor of Peloton Multi-Strategy
Master Fund during the term of the Loan but which has not
yet accrued, and (ii) 305,157 shares of common stock
issuable upon conversion by Peloton Multi-Strategy Master
Fund of $7,049,136 in outstanding principal under the Loan
at a conversion rate of $23.10 per share but which may not
be converted unless and until approval is obtained from our
stockholders to the issuance of conversion shares to the
extent that, following such conversion, Peloton Multi-
Strategy Master Fund would own more than 2,264,947 shares
(i.e. 19.99% of the 11,330,402 shares of our common stock
outstanding at the time of the Loan).
In addition, Peloton Multi-Strategy Master Fund currently
has the right to designate one director to serve on our
Board of Directors. Peloton Multi-Strategy Master Fund has
designated Raymond J. Pacini to serve as director.
(5) Includes 781,412 shares of common stock which are registered
hereby but as to which Peloton Multi-Strategy Master Fund was not
the beneficial owner as of July 24, 2006, consisting of (i)
476,255 shares of common stock issuable upon conversion of a
maximum of $1,023,416 in interest which may accrue in favor of
Peloton Multi-Strategy Master Fund during the term of the Loan
but which has not yet accrued, and (ii) 305,157 shares of common
stock issuable upon conversion by Peloton Multi-Strategy Master
Fund of $7,049,136 in outstanding principal under the Loan at a
conversion rate of $23.10 per share but which may not be
converted unless and until approval is obtained from our
stockholders to the issuance of conversion shares to the extent
that, following such conversion, Peloton Multi-Strategy Master
Fund would own more than 2,264,947 shares (i.e. 19.99% of our
common stock outstanding at the time of the Loan).
(6) Milfam II L.P. is the holder of 10% of the Loan.
Includes 55,096 shares of common stock issuable upon
conversion of $1,000,000 in principal under the Loan at a
conversion rate of $18.15 per share and 114,177 shares of
common stock issuable upon conversion of $2,637,500 in
principal under the Loan at a conversion rate of $23.10 per
share. Does not include 52,917 shares of common stock which
are registered hereby but as to which Milfam II L.P. was not
the beneficial owner as of July 24, 2006, consisting of
shares of common stock issuable upon conversion of a maximum
of $1,137,129 in interest which may accrue in favor of
Milfam II, L.P. during the term of the Loan but which has
not yet accrued.
The shares beneficially owned by Milfam II L.P. are included
within a total of 619,574 shares shown as beneficially owned
by Lloyd I. Miller, III in a Schedule 13G filed on July 7,
2006 with the SEC by Mr. Miller. Mr. Miller is the manager
of a limited liability company that is the general partner
of Milfam II L.P.
(7) Includes 52,917 shares of common stock which are registered
hereby but as to which Milfam II L.P. was not the beneficial
owner as of July 24, 2006, consisting of shares of common stock
issuable upon conversion of a maximum of $1,137,129 in interest
which may accrue in favor of Milfam II L.P. during the term of
the Loan but which has not yet accrued.
PLAN OF DISTRIBUTION
The shares of common stock offered by this prospectus will
be offered and sold by the selling stockholders named in this
prospectus, by their donees, or by their other successors in
interest. We have agreed to bear the expenses of the
registration of the shares, including legal and accounting fees,
other than fees of counsel, if any, retained individually by the
selling stockholders, and any discounts or commissions payable
with respect to sales of the shares.
The selling stockholders from time to time may offer and
sell the shares in transactions in the Nasdaq Global Market at
market prices prevailing at the time of sale. The selling
stockholders from time to time may also offer and sell the shares
in private transactions at negotiated prices. The selling
stockholders may sell their shares directly or to or through
broker-dealers who may receive compensation in the form of
discounts, concessions or commissions from the selling
stockholders or the purchasers of shares for whom such broker-
dealers may act as agent or to whom they may sell as principal,
or both. Such compensation may be in excess of customary
commissions.
From time to time, a selling stockholder may pledge or grant
a security interest in some or all of the shares which the
selling stockholder owns. If a selling stockholder defaults in
the performance of the selling stockholder's secured obligations,
the pledgees or secured parties may offer and sell the shares
from time to time by this prospectus (except, in some cases, if
the pledgees or secured parties are broker-dealers or are
affiliated with broker-dealers). The selling stockholders also
may transfer and donate shares in other circumstances. Donees
may also offer and sell the shares from time to time by this
prospectus (except, in some cases, if the donees are broker-
dealers or are affiliated with broker-dealers). The number of
shares beneficially owned by a selling stockholder will decrease
as and when a selling stockholder donates such stockholder's
shares or defaults in performing obligations secured by such
stockholder's shares. The plan of distribution for the shares
offered and sold under this prospectus will otherwise remain
unchanged, except that the donees, pledgees, other secured
parties or other successors in interest will be selling
stockholders for purposes of this prospectus. If we are notified
that a donee, pledgee or other successor in interest of a selling
stockholder intends to sell more than 500 shares of our common
stock, we will file a supplement to this prospectus which
includes all of the information required to be disclosed by Item
507 of Regulation S-K. Further, we will file a post-effective
amendment to this registration statement upon notification of any
change in the plan of distribution.
The selling stockholders and any broker-dealers acting in
connection with the sale of the shares covered by this prospectus
may be deemed to be "underwriters" within the meaning of Section
2(11) of the Securities Act of 1933, and any commissions received
by them and any profit realized by them on the resale of the
shares as principals may be deemed to be underwriting
compensation under the Securities Act of 1933.
We have agreed to indemnify the selling stockholders against
liabilities they may incur as a result of any untrue statement or
alleged untrue statement of a material fact in the registration
statement of which this prospectus forms a part, or any omission
or alleged omission in this prospectus or the registration
statement to state a material fact necessary in order to make the
statements made not misleading. This indemnification includes
liabilities that the selling stockholders may incur under the
Securities Act of 1933. We do not have to give such
indemnification if the untrue statement or omission was made in
reliance upon and in conformity with information furnished in
writing to us by the selling stockholders for use in this
prospectus or the registration statement.
We have advised the selling stockholders of the requirement
for delivery of this prospectus in connection with any sale of
the shares. We have also advised the selling stockholders of the
relevant cooling off period specified by Regulation M and
restrictions upon the selling stockholders' bidding for or
purchasing our securities during the distribution of shares.
TRANSFER AGENT
The transfer agent for our common stock is Continental Stock
Transfer & Trust Company, New York, New York.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the
securities offered under this prospectus will be passed upon for
us by Stephan, Oringher, Richman, Theodora & Miller, P.C.,
attorneys at law, Los Angeles, California.
EXPERTS
The financial statements and management's assessment of the
effectiveness of internal control over financial reporting (which
is included in Management's Report on Internal Control over
Financial Reporting) incorporated in this prospectus by reference
to the Annual Report on Form 10-K for the year ended December 31,
2005 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, an independent registered public
accounting firm, given on the authority of said firm as experts
in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange Commission a
registration statement on Form S-3, including exhibits, under the
Securities Act with respect to the common stock offered by this
prospectus. This prospectus, which is part of the registration
statement, does not contain all of the information in the
registration statement and the exhibits filed with it. For
further information about us and our common stock, you should
refer to the registration statement.
You may read, without charge, and copy, at prescribed rates,
all or any portion of the registration statement and any other
reports, statements or other information in the files of the
public reference room at the SEC's principal office at 100 F
Street, N.E., Washington, D.C. 20549. You can request copies of
these documents upon payment of a duplicating fee by writing to
the SEC. You may call the SEC at 1-800-SEC-0330 for further
information on the operation of its public reference room. Our
filings, including the registration statement, will also be
available to you on the Internet website maintained by the SEC at
http://www.sec.gov.
We are subject to the information and reporting requirements
of the Securities Exchange Act and file annual, quarterly and
current reports, proxy statements and other information with the
SEC. You can request copies of these documents, for a copying
fee, by writing to the SEC. We furnish our stockholders with
annual reports containing financial statements audited by our
independent auditors.
We also make available on our website www.cadizinc.com
copies of our annual, quarterly and special reports, proxy and
information statements and other information.
The SEC allows us to "incorporate by reference" the
information we file with them. This prospectus incorporates
important business and financial information about us which is
not included in or delivered with this prospectus. The
information incorporated by reference is an important part of
this prospectus, and information that we file later with the SEC
will automatically update and supersede this information.
We incorporate by reference the following documents:
* our Current Report on Form 8-K dated January 6, 2006, filed
on January 10, 2006;
* our Current Report on Form 8-K dated January 25, 2006, filed
on January 27, 2006;
* our Annual Report on Form 10-K for the year ended
December 31, 2005, filed on March 16, 2006 and as amended
by Amendment No. 1 on Form 10-K/A filed on April 28,
2006;
* our Quarterly Report on Form 10-Q for the quarter ended
March 31, 2006, filed on May 10, 2006;
* our Current Report on Form 8-K dated June 26, 2006, filed
on June 30, 2006;
* our Current Report on Form 8-K dated June 30, 2006, filed
on July 6, 2006;
* our Current Report on Form 8-K dated July 31, 2006, filed
on August 2, 2006;
* our Quarterly Report on Form 10-Q for the quarter ended
June 30, 2006, filed on August 9, 2006;
* the description of our common stock as set forth in our
registration statement filed on Form 8-A under the Exchange
Act on May 8, 1984, file number 012114, as amended by
reports on:
- Form 8-K filed with the SEC on May 26, 1988;
- Form 8-K filed with the SEC on June 2, 1992;
- Form 8-K filed with the SEC on May 18, 1999; and
- Annual Report on Form 10-K for the year ended December
31, 2003, filed on November 2, 2004
* future filings we make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934
until all of the shares offered by the selling stockholders
have been sold.
You may obtain a copy of these filings, without charge, by
writing or calling us at:
Cadiz Inc.
777 S. Figueroa Street
Suite 4250
Los Angeles, California 90017
Attention: Investor Relations
(213) 271-1600
If you would like to request these filings from us, please
do so at least five business days before you have to make an
investment decision.
You should rely only on the information incorporated by
reference or provided in this prospectus. We have not authorized
anyone else to provide you with different information. These
securities are not being offered in any state where the offer is
not permitted. You should not assume that the information in
this prospectus or the documents incorporated by reference is
accurate as of any date other than on the front of such
documents.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Cadiz estimates that expenses in connection with the
distribution described in this Registration Statement will be as
shown below. All expenses incurred with respect to the
distribution, except for fees of counsel, if any, retained
individually by a selling stockholder and any discounts or
commissions payable with respect to sales of the shares, will be
paid by Cadiz. See "Plan of Distribution."
SEC registration fee $ 4,540.92
Printing expenses $ -
Accounting fees and expenses $ 7,000.00
Legal fees and expenses $ 20,000.00
Miscellaneous $ 8,459.08
------------
Total $ 40,000.00
============
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law permits
Cadiz' Board of Directors to indemnify any person against
expenses, attorneys' fees, judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection
with any threatened, pending or completed action, suit or
proceeding in which he is made a party because he serves or
served as a director, officer, employee or agent of Cadiz or of
another entity. The language of Section 145 is sufficiently
broad to permit indemnification in some situations for
liabilities, including reimbursement for expenses incurred,
arising under the Securities Act of 1933, as amended. The statute
provides that indemnification pursuant to its provisions is not
exclusive of other rights of indemnification to which a person
may be entitled under any bylaw, agreement, vote of stockholders
or disinterested directors, or otherwise.
Cadiz' Bylaws provide for mandatory indemnification of
directors and officers of Cadiz, and those serving at the request
of Cadiz as directors, officers, employees, or agents of other
entities, to the maximum extent permitted by law. The Bylaws
provide that this indemnification shall be a contract right
between each of these persons and Cadiz.
The subscription agreements between Cadiz and the purchasers
of the securities registered for resale under this registration
statement provide that Cadiz shall indemnify the purchasers for
liabilities under the Securities Act of 1933 arising out of
untrue statements and omissions of material fact made by Cadiz in
this registration statement. The subscription agreements also
provide that the purchasers similarly shall indemnify Cadiz and
controlling persons of Cadiz for liabilities under the Securities
Act of 1933 arising out of untrue statements and omissions of
material fact made by the purchasers in this registration
statement.
Cadiz' Certificate of Incorporation provides that a director
of the company shall not be personally liable to the company or
its stockholders for monetary damages for breach of fiduciary
duty as a director, except for liability:
(1) for any breach of the director's duty of loyalty to Cadiz or
its stockholders;
(2) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law;
(3) under Section 174 of the Delaware General Corporation Law; or
(4) for any transaction from which the director derived an
improper personal benefit.
Cadiz' Certificate of Incorporation provides that if the
Delaware General Corporation Law is subsequently amended to
authorize the further elimination or limitation of the liability
of a director, then the liability of a director shall be
eliminated or limited to the fullest extent permitted by the law
as amended. Cadiz also has purchased a liability insurance
policy which insures its directors and officers against certain
liabilities, including liabilities under the Securities Act of
1933.
ITEM 16. EXHIBITS.
The following exhibits are filed or incorporated by
reference as part of this Registration Statement.
5.1 Opinion of Stephan, Oringher, Richman, Theodora &
Miller, P.C. as to the legality of the securities being
registered(1)
10.1 $36,375,000 Credit Agreement among Cadiz Inc. and
Cadiz Real Estate LLC, as Borrowers, the Several Lenders
from time to time parties thereto, and Peloton Partners
LLP, as Administrative Agent, dated as of June 26,
2006(1)
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Stephan, Oringher, Richman, Theodora &
Miller, P.C. (included in its opinion filed as Exhibit
5.1)(1)
24.1 Power of Attorney (included on signature page)(1)
-----------------------------
(1) Filed previously
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are
being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the
registration statement (or the most recent post-
effective amendment thereof) which, individually
or in the aggregate, represent a fundamental
change in the information set forth in the
registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of
securities offered would not exceed that which was
registered) and any deviation from the low or high
end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price
represent no more than a 20% change in the maximum
aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement;
(iii)To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and
(a)(1)(iii) do not apply if the registration statement is on Form
S-3 or Form F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained in
reports filed with or furnished to the Commission by the
registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement, or is contained in a
form of prospectus filed pursuant to Rule 424(b) that is part of
this registration statement;
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities
offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide
offering thereof; and
(3) To remove from registration by means of a post-
effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
(4) [Intentionally omitted]
(5) That, for the purpose of determining liability under
the Securities Act of 1933 to any purchaser:
(i) If the registrant is subject to Rule 430C, each
prospectus filed pursuant to Rule 424(b) as part
of a registration statement relating to an
offering, other than registration statements
relying on Rule 430B or other than prospectuses
filed in reliance on Rule 430A, shall be deemed to
be part of and included in the registration
statement as of the date it is first used after
effectiveness. Provided, however, that no
statement made in a registration statement or
prospectus that is part of the registration
statement or made in a document incorporated or
deemed incorporated by reference into the
registration statement or prospectus that is part
of the registration statement will, as to a
purchaser with a time of contract of sale prior to
such first use, supersede or modify any statement
that was made in the registration statement or
prospectus that was part of the registration
statement or made in any such document immediately
prior to such date of first use.
(b) That for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's
annual report pursuant to section 13(a) or section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report
pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes to deliver or
cause to be delivered with the prospectus, to each person to
whom the prospectus is sent or given, the latest annual
report to stockholders that is incorporated by reference in
the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the
Securities Exchange Act of 1934; and, where interim
financial information required to be presented by Article 3
of Regulation S-X are not set forth in the prospectus, to
deliver, or cause to be delivered to each person to whom the
prospectus is sent or given, the latest quarterly report
that is specifically incorporated by reference in the
prospectus to provide such interim financial information.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant
to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for
indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in
the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in
connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Los Angeles, State of California, on August 10, 2006.
CADIZ INC.
Registrant
By: /s/ Keith Brackpool
-------------------------------
Keith Brackpool, Chairman and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
/s/ Keith Brackpool Chief Executive Officer August 10, 2006
------------------------ and Director
Keith Brackpool (Principal Executive Officer)
/s/ O'Donnell Iselin II Chief Financial Officer August 10, 2006
------------------------ (Principal Financial and
O'Donnell Iselin II Accounting Officer)
* Director August 10, 2006
------------------------
Murray H. Hutchinson
* Director August 10, 2006
------------------------
Timothy J. Shaheen
* Director August 10, 2006
------------------------
Raymond J. Pacini
* Director August 10, 2006
------------------------
Stephen J. Duffy
* By: /s/ O'Donnell Iselin II
-----------------------------
Attorney-in-fact
EXHIBITS INDEX
Exhibit No.: Title of Document
------------ -----------------
5.1 Opinion of Miller & Holguin LLP as to the legality
of the securities being registered(1)
10.1 $36,375,000 Credit Agreement among Cadiz Inc. and
Cadiz Real Estate LLC, as Borrowers, the Several Lenders
from time to time parties thereto, and Peloton Partners
LLP, as Administrative Agent, dated as of June 26,
2006(1)
23.1 Consent of PricewaterhouseCoopers LLP
23.2 Consent of Miller & Holguin LLP (included in its
opinion filed as Exhibit 5.1)(1)
24.1 Power of Attorney (included on signature page)(1)
-------------
(1) Filed previously