exv10w14






Exhibit 10.14









	 	 	 
	 

	 	240 Cedar Knolls Road
	 

	 	Cedar Knolls, New Jersey 07927
	 
	 	 
	 

	 	Phone   973-532-8000
	 

	 	Fax       973-532-8115






October 22, 2009





	To:	 	NR Securities LTD

c/o Artemis Trustees Limited

Attn: David Larkin

Sydney Vane House

Admiral Park

St. Peter Port

Guernsey GY13EL

Channel Islands
	 
	Re:	 	 Adjustments to Warrant No. A1 Issued by Emisphere Technologies, Inc. on March 31, 2005 (the “Warrant”)




Dear Warrant Holder:




     Pursuant to the terms of the Warrant, Emisphere Technologies, Inc. (the “Company”) is required
to provide you with notice upon any antidilution adjustments. As described below, the Company has
consummated certain financing transactions (the “Transactions”) that result in a new exercise price
of $3.81 for shares subject to the Warrant. Additionally, the Warrant now entitles you to purchase
from the Company up to a total of 196,850 shares of common stock, par value $0.01 per share, of the
Company (“Common Stock”).



     Prior to the Transactions, the Warrant entitled the holder to purchase up to 188,442 shares
(“Warrant Shares”) of Common Stock at an exercise price for each share of Common Stock of $3.98.
According to the terms of the Warrant, certain antidilution adjustments are required to be made
upon the occurrence of certain events.



The Transactions




     On August 21, 2009, the Company completed the sale of 5,714,286 shares of Common Stock and
warrants to purchase up to 2,685,714 additional shares of Common Stock in a registered offering
(the “Registered Offering”). The shares of Common Stock and warrants were sold together as units
for a negotiated sales price of $0.70. The Common Stock sold in the Registered Offering had a
deemed price of $0.54725 per share. The value of the warrant coverage for the warrants sold in the
Registered Offering was $0.15275. Based on the 47% level of warrant coverage, the consideration
received for a warrant to purchase one full share of Common Stock is $0.325 ($0.15275 divided by
47%). The warrants are also subject to an exercise price of $0.70 per share of common stock,
resulting in a total price for each share of Common Stock subject to the warrants of $0.325 plus
$0.70, or $1.025.



 









 





     Also on August 21, 2009, the Company completed the sale of 6,015,037 shares of Common Stock
and warrants to purchase up to 3,729,323 additional shares of Common Stock in a private placement
transaction (the “Private Placement”). The shares of Common Stock and warrants were sold together
as units for a negotiated sales price of $0.665. The Common Stock sold in the Private Placement
had a deemed price of $0.4635 per share. The value of the warrant coverage for the warrants sold
in the Private Placement was $0.2015. Based on the 62% level of warrant coverage, the
consideration received for a warrant to purchase one full share of Common Stock is $0.325 ($0.2015
divided by 62%). The warrants are also subject to an exercise price of $0.70 per share of common
stock, resulting in a total price for each share of Common Stock subject to the warrants of $0.325
plus $0.70, or $1.025.



     In connection with the Registered Offering, the Company issued warrants to purchase up to
504,000 shares of Common Stock to Rodman & Renshaw, LLC, as compensation for services rendered as
the Company’s placement agent and financial adviser (the “Rodman Warrant”). Each share of Common
Stock subject to the Rodman Warrant is exercisable at an exercise price of $0.875 per share.



Adjustment Calculations




     The calculations reflecting the antidilution adjustments required to be made as a result of
the Transactions are described below.



Adjustment to Exercise Price




     The Warrant provides that upon the issuance of Additional Shares of Common Stock (as defined
in the Warrant), without consideration or for a consideration per share less than the exercise
price in effect on the date of and immediately prior to such issuance, the exercise price shall be
reduced to a price (calculated to the nearest cent) determined in accordance with the following
formula:



     New
Exercise Price = EP1 x CS1 + AS1

CS1
+ AS2





	 	 	where

EP1 = 	the exercise price then in effect;
	 	 	CS1 = 	the total number of shares of Common Stock outstanding immediately prior to
such issue calculated on a fully diluted basis, as if all convertible securities had
been fully converted into shares of Common Stock and any outstanding options bearing an
exercise price lower than the price at which the Additional Shares of Common Stock were
issued had been fully exercised as of such date;
	 	 	AS1 = 	the total number of Additional Shares of Common Stock that would have been
issued at the aggregate consideration received by the Company at the exercise price in
effect immediately prior to such issuance; and
	 	 	AS2 = 	 the total number of Additional Shares of Common Stock issued.




 









 











	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Registered Offering	 	 	Private Placement	 	 	 	 
	Variables	 	Common Stock	 	 	Warrants	 	 	Common Stock	 	 	Warrants	 	 	Rodman Warrants	 
	EP1
	 	$	3.98	 	 	$	3.44	 	 	$	3.22	 	 	$	2.83	 	 	$	2.63	 
	CS1
	 	 	30,341,078	 	 	 	36,879,864	 	 	 	36,055,364	 	 	 	42,894,901	 	 	 	42,219,901	 
	AS1
	 	 	785,714	 	 	 	254,036	 	 	 	864,545	 	 	 	428,281	 	 	 	167,705	 
	AS2
	 	 	5,714,286	 	 	 	2,685,714	 	 	 	6,015,037	 	 	 	3,729,323	 	 	 	504,000	 
	New Exercise Price
	 	$	3.44	 	 	$	3.22	 	 	$	2.83	 	 	$	2.63	 	 	$	2.61	 





NOTE: Actual calculations are based on unrounded amounts.




     As calculated above, the new exercise price of the Warrant would have decreased from $3.98 to
$2.61 after giving effect to the Transactions. However, Section 7(j) of the Warrant provides that
the exercise price of the Warrant shall not be reduced below $3.81 (as adjusted for stock splits,
stock combinations and similar events). Therefore, the new exercise price of the Warrant is $3.81.



Adjustment to Share Number




     The Warrant provides that upon each adjustment of the exercise price, the number of Warrant
Shares shall be adjusted by multiplying such number of Warrant Shares by a fraction, the numerator
of which shall be the exercise price in effect immediately prior to such adjustment and the
denominator of which shall be the exercise price in effect after giving effect to such adjustment.



     New Warrant Shares = WS1 x (EP1 / EP2)



     where



     WS1 = the Warrant Shares then in effect;



     EP1 = the exercise price then in effect; and



     EP2 = the exercise price now in effect.



     New Warrant Shares = 188,442 x ($3.98 / $3.81)



     New Warrant Shares = 196,850



     If you have any questions regarding this notice, please contact Michael R. Garone by telephone
at (973) 532-8005.



	 	 	 	 	 
	 	Very truly yours,





EMISPHERE TECHNOLOGIES, INC.

 	 
	 	By:  	/s/ Michael R. Garone
 	 
	 	 	Michael R. Garone 	 
	 	 	Chief Financial Officer