SCHEDULE 13D
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Misonix, Inc.
(Name of Issuer)
Common Stock
(Title of Class of Securities)
604871103
(CUSIP Number of Class of Securities)
Robert L. Chapman, Jr.
Chapman Capital L.L.C.
Pacific Corporate Towers
222 N. Sepulveda Blvd., Suite 1322
El Segundo, California 90245
(310) 662-1900
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
April 1, 2003
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box [ ].
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Chap-Cap Partners, L.P.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS)
(a)[x]
(b)[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
0
8 SHARED VOTING POWER
422,870
9. SOLE DISPOSITIVE POWER
0
10. SHARED DISPOSITIVE POWER
422,870
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
422,870
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.4%
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Chapman Capital L.L.C.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS)
(a)[x]
(b)[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
N/A
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
0
8 SHARED VOTING POWER
422,870
9. SOLE DISPOSITIVE POWER
0
10. SHARED DISPOSITIVE POWER
422,870
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
422,870
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.4%
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OO
1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Robert L. Chapman, Jr.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE
INSTRUCTIONS)
(a)[x]
(b)[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS
N/A
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7. SOLE VOTING POWER
0
8 SHARED VOTING POWER
422,870
9. SOLE DISPOSITIVE POWER
0
10. SHARED DISPOSITIVE POWER
422,870
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
422,870
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) [ ]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.4%
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
This Schedule 13D is being filed on behalf of Chap-Cap Partners, L.P., a
Delaware limited partnership ("Chap-Cap"), Chapman Capital L.L.C., a Delaware
limited liability company ("Chapman Capital"), Robert L. Chapman, Jr., an
individual ("Mr. Chapman" and, together with Chap-Cap and Chapman Capital, the
"Reporting Persons"). This Schedule 13D relates to the common stock, no par
value per share, of Misonix, Inc., a New York corporation (the "Issuer" or
"Company"). Unless the context otherwise requires, references herein to the
"Common Stock" are to such common stock of the Company. Chapman Capital is the
investment manager and adviser to, and general partner of, Chap-Cap. Chap-Cap
directly owns the Common Stock beneficially owned by the Chapman Reporting
Persons and to which this Schedule 13D relates, and the Chapman Reporting
Persons may be deemed to have beneficial ownership over such Common Stock by
virtue of the authority granted to them by Chap-Cap to vote and to dispose of
the securities held by Chap-Cap, including the Common Stock.
ITEM 1. Security and Issuer
This statement on Schedule 13D relates to the Common Stock of the Company.
The address of the principal executive offices of the Company is 1938 New
Highway, Farmingdale, NY 11735.
ITEM 2. Identity and Background
(a) This statement is being filed by Chap-Cap Partners, L.P., a Delaware
limited partnership ("Chap-Cap"), Chapman Capital L.L.C., a Delaware limited
liability company ("Chapman Capital"), and Robert L. Chapman, Jr. (collectively,
the "Reporting Persons").
(b) The address of the principal business and principal office of Chap-Cap,
Chapman Capital and Robert L. Chapman, Jr. is Pacific Corporate Towers, 222 N.
Sepulveda Blvd., El Segundo, California 90245.
(c) Chap-Cap's present principal business is investing in marketable
securities. Chapman Capital's present principal business is serving as the
General Partner of Chap-Cap. Robert L. Chapman, Jr.'s present principal
occupation is serving as Managing Member of Chapman Capital.
(d) None of the Reporting Persons, nor, to the best of their knowledge, any
of their directors, executive officers, general partners or members has, during
the last five years, been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) None of the Reporting Persons, nor, to the best of their knowledge, any
of their directors, executive officers, general partners or members has, during
the last five years, been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
(f) Robert L. Chapman, Jr. is a citizen of the United States.
ITEM 3. Source and Amount of Funds or Other Consideration.
The source and amount of funds used by the Reporting Persons in making
their purchases of the shares of Common Stock beneficially owned by them are set
forth below:
SOURCE OF FUNDS AMOUNT OF FUNDS
Working Capital $1,195,802
ITEM 4. Purpose of Transaction
The purpose of the acquisition of the securities of the Company
beneficially owned by Chap-Cap was to acquire such securities in the ordinary
course of their trade or business of purchasing, selling, trading and investing
in securities.
Mr. Chapman has spoken with management of the Company regarding his desire
for the Company to consider certain business strategies, joint ventures,
recapitalizations, a full sale of the Company, sales of assets, mergers,
negotiated or open-market stock repurchases or other extraordinary corporate
transactions (collectively, "Potential Transactions"). On April 1, 2003, Mr.
Chapman engaged in discussions with the Issuer's CEO and President, Mr. Michael
A. McManus, Jr., regarding Mr. Chapman's view that the Issuer's shareholders
would be better served by the Issuer's being merged into another enterprise
through a premium change-of-control transaction or other form of liquidation. On
April 14, 2003, Mr. Chapman sent a critical letter to Mr. McManus and the Board
of Directors of the Issuer. The correspondence, dated April 14, 2003, is
attached hereto as Exhibit B.
The Reporting Persons may in the future consider a variety of different
alternatives to achieving their goal of maximizing shareholder value, including
negotiated transactions, tender offers, proxy contests, consent solicitations,
or other actions. However, it should not be assumed that such members will take
any of the foregoing actions. The members of the Reporting Persons reserve the
right to participate, alone or with others, in plans, proposals or transactions
of a similar or different nature with respect to the Company.
The Reporting Persons intend to review their investment in the Company on a
continuing basis and, depending on various factors, including the Company's
business, affairs and financial position, other developments concerning the
Company, the price level of the Common Stock, conditions in the securities
markets and general economic and industry conditions, as well as other
investment opportunities available to them, may in the future take such actions
with respect to their investment in the Company as they deem appropriate in
light of the circumstances existing from time to time. Such actions may include,
without limitation, the purchase of additional shares of Common Stock in the
open market and in block trades, in privately negotiated transactions or
otherwise, the sale at any time of all or a portion of the Common Stock now
owned or hereafter acquired by them to one or more purchasers, or the
distribution in kind at any time of all or a portion of the Common Stock now
owned or hereafter acquired by them.
The Reporting Persons are engaged in the investment business. In pursuing
this business, Chapman Capital personnel analyze the operations, capital
structure and markets of companies, including the Company, on a daily basis
through analysis of documentation and discussions with knowledgeable industry
and market observers and with representatives of such companies (often at the
invitation of management). From time to time, Chapman Capital analysts may hold
discussions with third parties or with management of such companies in which the
Reporting Person may suggest or take a position with respect to potential
changes in the operations, management or capital structure of such companies as
a means of enhancing shareholder value. Such suggestions or positions may relate
to one or more of the transactions specified in clauses (a) through (j) of Item
4 of Schedule 13D of the Exchange Act, including, without limitation, such
matters as disposing of or selling all or a portion of the Company or acquiring
another Company or business, changing operating or marketing strategies,
adopting or not adopting certain types of anti-takeover measures and
restructuring the company's capitalization or dividend policy.
Except as set forth above and in Exhibit B, the Reporting Persons do not
have any present plans or proposals that relate to or would result in any of the
actions required to be described in Item 4 of Schedule 13D. Each of the
Reporting Persons may, at any time, review or reconsider its position with
respect to the Company and formulate plans or proposals with respect to any of
such matters, but has no present intention of doing so.
ITEM 5. Interest in Securities of the Issuer
(a) Together, the Reporting Persons beneficially own a total of 422,870
shares of Common Stock constituting 6.4% of all of the outstanding shares of
Common Stock.
(b) The Reporting Persons have the shared power to vote or direct the vote
of, and to dispose or direct the disposition of, the shares of Common Stock
beneficially owned by them.
(c) The following transactions were effected by the Reporting Persons
during the past sixty (60) days:
Approximate
Amount of Shares Price per Shares
Date Security Bought/(Sold) (inclusive of commissions)
03/27/03 Common Shares 30,300 $2.50
03/28/03 Common Shares 5,000 $2.50
04/01/03 Common Shares 4,700 $2.50
04/02/03 Common Shares 222,870 $2.37
The above transactions were effected by the Reporting Persons on the NASDAQ
National Market.
Except as set forth above, during the last sixty days there were no
transactions in the Common Stock effected by the Reporting Persons, nor, to the
best of their knowledge, any of their directors, executive officers, general
partners or members.
(d) Except as set forth in this Item 5, no other person is known to have
the right to receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the shares of Common Stock beneficially owned by
the Reporting Persons.
(e) Not applicable.
ITEM 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer
Not applicable.
ITEM 7. Material to be Filed as Exhibits
Exhibit A - Joint Filing Agreement, dated as of April 14, 2003, by and
among the members of the Reporting Persons.
Exhibit B - Letter from Robert L. Chapman, Jr., as Managing Member of
Chapman Capital L.L.C., to Mr. Michael A. McManus, Jr., CEO and President of the
Company, dated April 14, 2003.
SIGNATURES
After reasonable inquiry and to the best of our knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.
Dated: April 14, 2003 CHAP-CAP PARTNERS, L.P.
By: Chapman Capital L.L.C.,
as General Partner
By:/s/ Robert L. Chapman, Jr.
--------------------------
Name: Robert L. Chapman, Jr.
Title: Managing Member
Dated: April 14, 2003 CHAPMAN CAPITAL L.L.C.
By:/s/ Robert L. Chapman, Jr.
--------------------------
Name: Robert L. Chapman, Jr.
Title: Managing Member
Dated: April 14, 2003
/s/ Robert L. Chapman, Jr.
--------------------------
Robert L. Chapman, Jr.
Exhibit A
JOINT FILING AGREEMENT
The undersigned hereby agree that the statement on Schedule 13D with
respect to the Common Stock of Misonix, Inc. dated April 14, 2003, and any
further amendments thereto signed by each of the undersigned, shall be filed on
behalf of each of the undersigned pursuant to and in accordance with the
provisions of Rule 13d-1(f) under the Securities Exchange Act of 1934, as
amended.
Dated: April 14, 2003
CHAP-CAP PARTNERS, L.P.
By: Chapman Capital L.L.C.,
as General Partner
By:/s/Robert L. Chapman, Jr.
--------------------------
Robert L. Chapman, Jr.
Managing Member
CHAPMAN CAPITAL L.L.C.
By:/s/Robert L. Chapman, Jr.
--------------------------
Robert L. Chapman, Jr.
Managing Member
/s/Robert L. Chapman, Jr.
--------------------------
Robert L. Chapman, Jr.
Exhibit B
CHAPMAN CAPITAL L.L.C. LETTERHEAD
Robert L. Chapman, Jr.
Managing Member
April 14, 2003
Mr. Michael A. McManus, Jr.
CEO and President
Misonix, Inc. (formerly Medsonic, Inc.)
1938 New Highway
Farmingdale, NY 11735
Dear Mr. McManus:
Chap-Cap Partners, L.P. (CCP), the Delaware limited partnership advised by
Chapman Capital L.L.C., owns over 422,000 common shares of Misonix, Inc.
(hereinafter, "Misonix," "MSON" or "the Company"). Such an investment in the
company you have been hired to manage amounts to approximately 6.4% of the
Company's outstanding shares. We were able to acquire what appears to be the
second largest stake in Misonix by mopping up the relentless vomiting of shares
by several large shareholders in early April 2003. Though I do not know the
identity of those who hurled their shares upon us, I imagine that they
contracted a severe case of "stock poisoning" that induced such a gag reflex.
With Misonix's enterprise valuation trolling the market's depths at around 50%
of sales, MSON's owners clearly doubt your ability to bring the Company to
sustained profitability.
I feel much compassion for those who have held positions in MSON since your
arrival some four and a half years ago. Anyone who placed and kept the faith in
your stewardship has lost 50% of their investment since you took MSON's corner
office on November 2, 1998 (see Chart 1 below). As I have become accustomed to
hearing excuse after excuse from you since our first conversation in October
2002, I suspect you may blame external forces (e.g., the stock market) for
MSON's showcase of capital losses. To counter such anticipated pretext, I have
provided Chart 2 below that exhibits the comparative returns between MSON's
shares and several relevant market indices. As is plain to see, MSON's > 50%
degradation under Mike "Mc-Minus" McManus greatly underperformed both the Nasdaq
Industrial Index (down only 10%) and the less-than-all-star S&P 500 Healthcare
Equipment Index (up over 30%) during your resume-wrecking tenure.
CHART 1
[Chart of Issuer's share price and attendant volume during Mr. McManus'
tenure]
CHART 2
[Chart of Issuer's share price performance compared to that of the
Nasdaq Industrial and S&P 500 Healthcare Equipment Indices during Mr. McManus'
tenure]
Chap-Cap Partners' interest in MSON was aroused by its antecedent 13D stake in
NWH, Inc. (NASDAQ: NWIR), on whose CEO-tolerant Board you have held a seat since
October 1994. Since that fortuitously-timed acceptance of a directorship
(legally and supposedly to oversee your long-time buddy Terrence S. Cassidy),
NWH's common shares have doubled in value. There are investors who would not
credit your arrival at NWH with the shares' ascent, particularly when the
majority of this appreciation occurred following the 13D filing on December 13,
2002 by none other than Chap-Cap Partners, L.P. Yet, I would like to think that
you played a minor role in moving NWH in the right direction, though its final
fate remains relatively uncertain at best. Yet, when I see that MSON appears to
have reported operating losses per share (ignoring litigation reserve reversals)
in three of the last four quarters and flat-to-down revenues in half of them, I
find myself pondering if support by MSON's Board of Directors for your continued
leadership is warranted.
Given the enormous financial hemorrhaging that has accompanied your
"bleedership" of MSON, I cannot help but wonder if you should have kept your
professional focus on "mergers, medicine and mascara." Upon merging New York
Bancorp in 1998, you created an exit strategy for that public company's
shareholders at a price some 20 times that of the shares when you and Patrick
Malloy led a successful 1990 proxy fight against entrenched management.
Following your leadership at Jamcor Pharmaceuticals, Inc. from 1990-1991, you
successfully served as Pfizer's vice president of Strategic Planning at a time
of extraordinary development for that $200 billion leader in medicine. Having
Revlon, Inc. on your resume may be something of an embarrassment today given
that company's current financial condition, but in 1985 working hand-in-hand
with corporate raider Ronald Perelman must have been a rewarding experience as
you helped permanently define the rules of the takeover game. However, your run
of good luck seems to have ended the day you took the CEO job at Misonix. At the
risk of stating the obvious, your executive track record in the world of
"medical, scientific, and industrial ultrasonic and air pollutions systems" has
been no 20 bagger.
I have become increasingly concerned that your career assisting politicians such
as President Reagan and cosmetics tycoons such as Ron Perelman have made you an
incorrigible purveyor of lip service. Since October 2002, you have vowed that
the owners of NWH, Inc. will not end up in a wretched mess such as occurred with
Terrence Cassidy and the Pine Top Insurance scandal. When NWH subsidiary
executive Dean Politi's name was listed as the contact to discuss ENS's Aetna
connectivity agreement, but the bloke would not talk to the very owners of NWH
who indirectly pay the salary supporting the lifestyle to which his wife Diane
has become accustomed, you promised to correct this horrific breach of owner's
rights. Yet, neither of your promises has been fulfilled, as both of these
public company employees continue to treat their owners with utter disrespect.
If you are nothing more than a career politician who got lucky being long a bank
stock before Greenspan torpedoed interest rates, then I must reiterate something
I've said for years, "Politicians and Diapers Need to be Changed ... Often for
the Same Reasons."
I want you to go to sleep tonight knowing that Chapman Capital L.L.C. will be
watching your every move as CEO of Misonix, Inc. Unlike the shareholders who
preceded me, I will not breathe the hot air that you seem to naturally produce.
I can't be bargained with, nor do I feel pity, remorse or fear. In addition,
rest assured that I absolutely will not stop, ever, until the owners of the
Company have seen the maximization of their investment.
Very truly yours,
[/s/ _____________]
Robert L. Chapman, Jr.
cc: Misonix, Inc. Board of Directors:
Gary Gelman (Chairman/CEO/President, American Claims
Evaluation, Inc.)
Arthur Geerstenfeld (Chairman/CEO/Founder, UFA Inc..; and
Professor, Worcester Polytechnic Institute)
Howard Alliger (Founder, predecessor to Misonix, Inc.; and
Chairman, CEO/President, Arco Inc.)
T. Guy Minetti (Vice Chairman, 1-800-Flowers.com; and
Former M.D., Bayberry Advisors; and
Former M.D., Kidder, Peabody & Company)
Thomas F. O'Neill (Founder, Sandler O'Neil & Partners, L.P.; and
Former banker, L.F. Rothschild; and
Former M.D., Bear Stearns Company)