Edgar Filing: CHEMBIO DIAGNOSTICS, INC.

form424b3.htm

Prospectus Supplement No. 2

Filed Pursuant to Rule 424(b)(3)

(to Prospectus dated April 27, 2007)

Registration File No. 333-125942

CHEMBIO DIAGNOSTICS, INC.

18,610,710 SHARES OF COMMON STOCK

This Prospectus Supplement No. 2 supplements and amends the Prospectus dated April 27, 2007 (the “Prospectus”) and the Prospectus Supplement, dated December 26, 2007 (the "Prospectus Supplement"), to the Prospectus, all of which relate to the sale from time to time of up to 18,610,710 shares of our common stock by certain selling stockholders.

Due to a clerical error, the “Selling Security Holders” table was incorrect in the Prospectus Supplement.

The information in both the Prospectus and the Prospectus Supplement under the heading “Selling Security Holders” is amended and superseded by the information included herein.

This Prospectus Supplement No. 2 should be read in conjunction with, and delivered with, the Prospectus and the Prospectus Supplement and is qualified by reference to the Prospectus and the Prospectus Supplement.

Our common stock is listed on the OTC Bulletin Board under the symbol “CEMI.OB.”

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if the Prospectus, the Prospectus Supplement, or this Prospectus Supplement No. 2 is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this Prospectus Supplement No. 2 is December 26, 2007.

SELLING SECURITY HOLDERS

The named selling security holders set forth below are offering shares of the Company's common stock. The table below assumes the immediate exercise of all warrants to purchase common stock, without regard to other factors which may determine whether such exercises occur. These factors include but are not limited to the terms of the warrant agreements, and the specific exercise price of the securities held by such selling security holder and its relation to the market price. The selling security holders may from time to time offer and sell pursuant to this prospectus up to an aggregate of 15,720,961 shares of our common stock, plus any additional shares of common stock which they may receive at a later date pursuant to the anti-dilution provisions of certain warrants. The selling security holders may, from time to time, offer and sell any or all of the shares that are registered under this prospectus, although they are not obligated to do so.

The following table sets forth, to the Company’s best knowledge and belief, with respect to the selling security holders:

•	the number of shares of common stock beneficially owned as of December 26, 2007 and prior to the offering contemplated hereby;
•	the number of shares of common stock eligible for resale and to be offered by each selling security holder pursuant to this prospectus;
•	the number of shares owned by each selling security holder after the offering contemplated hereby assuming that all shares eligible for resale pursuant to this prospectus actually are sold;
•	the percentage of the Company's total outstanding shares of common stock beneficially owned by each selling security holder after the offering contemplated hereby; and
•	in notes to the table, additional information concerning the selling security holders including any NASD affiliations and any relationships, excluding non-executive employee and other non-material relationships, that a selling security holder had during the past three years with the registrant or any of its predecessors or affiliates.

Selling security holders (C)	Number of Shares of Common Stock Owned Before Offering (A)		Number of Shares to be Offered (B)		Number of Shares Owned After Offering		Percentage of Shares of Common Stock Owned After Offering
Alpha Capital AG ^2,3		1,894,024		660,000		1,894,024		3.07	%
Bassett, Truman ¹		42,526		3,866		42,526		0.07	%
Baum, Mark L. ²		911,849		869,622		911,849		1.49	%
Bell, Lon E. ²		378,602		151,178		378,602		0.62	%
Beller, Claudio ²		129,254		11,470		129,254		0.21	%
BioEquity Partners, Inc. ^1,4		109,375		84,375		109,375		0.18	%
Breitbart, Ted ^1,5		14,208		14,208		14,208		0.02	%
Bruce, Richard ¹		105,075		75		105,075		0.17	%
Calamaro, Jean-Paul ²		250,619		23,194		250,619		0.41	%
Chrust, Steve ¹		11,605		11,605		11,605		0.02	%
Clarke, John R.^1,6		23,909		23,909		23,909		0.04	%
Crestview Capital Master, LLC ⁷		24,145,310		5,782,472		24,145,310		36.20	%
Dabush, Ami ²		460,336		45,871		460,336		0.76	%
Daedalus Consulting, Inc.⁸		71,926		71,926		71,926		0.12	%
Diamond Deecembra ⁸		287,706		287,706		287,706		0.47	%
DKR Soundshore Oasis Holding Fund, Ltd.⁹		835,499		835,499		835,499		1.36	%
Eckert, Christopher & Lynn ^2,10		229,554		100,000		229,554		0.38	%
Engel, Sam ¹		4,118		374		4,118		0.01	%
Esfandiari, Javan ¹		754,580		2,007		754,580		1.24	%
FAMALOM, LLC ⁸		359,634		359,634		359,634		0.59	%
Feldman, Stephen ¹		1,868		187		1,868		0.00	%
Fuchs, Ari ^2,6		6,641		6,641		6,641		0.01	%
Ginsberg, Mike ¹		2,375		216		2,375		0.00	%
Glass, Marc ¹		1,883		1,883		1,883		0.00	%
Goldberg, Jeffrey ^1,11		27,875		27,875		27,875		0.05	%
Greenblatt, Phil ¹		10,347		941		10,347		0.02	%
Gregoretti, Gordan		59,458		59,373		59,458		0.10	%
Gressel, Daniel ^1,12		6,346		6,346		6,346		0.01	%
Guzikowski, Frank J.¹		178,114		16,192		178,114		0.29	%
H.C. Wainwright & Co. ^1,13		53,715		53,715		53,715		0.09	%
Haendler, Kurt ¹		91,621		45,998		91,621		0.15	%
Haendler, Renata ¹		131,863		59,133		131,863		0.22	%
Haendler, Tomas ^2,14		143,726		86,257		143,726		0.24	%
Haim, Eduardo ¹		7,115		647		7,115		0.01	%
Hamblett, Michael ¹⁵		404,831		382,109		404,831		0.66	%
Hanson, Andrew Merz ^2,16		158,105		60,471		158,105		0.26	%
Ide, Bruce J.^2,17		567,305		160,961		567,305		0.94	%
Jacob, Sam ¹		10,000		10,000		10,000		0.02	%
Jacoby, Richard A.²		473,955		213,811		473,955		0.78	%
Joffe, Wendy ²		31,703		2,057		31,703		0.05	%
Jordan, Bruce ¹⁸		65,418		7,761		65,418		0.11	%
JP Turner ^1,5		41,250		41,250		41,250		0.07	%
Keskinen, Karen ¹		1,579		144		1,579		0.00	%
Klaus, Elaine ¹		2,242		204		2,242		0.00	%
Knasin, Paul and Ellen ²		177,696		76,608		177,696		0.29	%
Koch, Scott F.^1,6		158,400		158,400		158,400		0.26	%
Kreger, Richard ¹⁸		1,090,404		540,315		1,090,404		1.78	%
Kurzman Partners, LP ¹⁹		31,146		31,146		31,146		0.05	%
Lankenau, Robert ¹		20,045		18,090		20,045		0.03	%
Lanouette, Kevin P.		54,768		23,749		54,768		0.09	%
Larkin, Richard ²		215,967		30,486		215,967		0.36	%
Lawrence, Colin ¹		7,115		647		7,115		0.01	%
Ledowitz, Bill ¹		6,471		647		6,471		0.01	%
Lifshitz, Joshua ²⁰		33,928		12,716		33,928		0.06	%
Little Gem Life Sciences Fund LLC ²¹		111,025		109,373		111,025		0.18	%
Lyashchenko, Konstantin ¹		35,075		75		35,075		0.06	%
Maloney & Company, LLC		24,484		5,876		24,484		0.04	%
Mayer-Wolf, Mike ¹		18,379		1,671		18,379		0.03	%
McCarthy, Michael ¹		4,145		377		4,145		0.01	%
Metasequoia, LLC ²		50,082		20,000		50,082		0.08	%
Midtown Partners & Co., LLC ²²		261,122		56,824		261,122		0.43	%
Millennium 3 Opportunity Fund, LLC ²³		4,006,610		1,557,376		4,006,610		6.45	%
Moran, Sean		37,000		35,624		37,000		0.06	%
MSAS Trust ²		429,085		45,282		429,085		0.71	%
Nite Capital, LP		584,508		534,374		584,508		0.96	%
Joesph Nnorom		6,000		6,000		6,000		0.01	%
Pelossof, Avi ²		411,238		34,650		411,238		0.68	%
Pelossof, Elior ²		113,577		45,354		113,577		0.19	%
Phillips, Chris ⁸		79,173		34,192		79,173		0.13	%
Poole, Colin ²		78,135		75,589		78,135		0.13	%
Poole, John G.¹		68,365		6,215		68,365		0.11	%
Raker, Gilbert ²		45,354		45,354		45,354		0.07	%
Reibman, Spencer ¹		257		257		257		0.00	%
Rohan, J. Rory ¹⁸		360,212		166,489		360,212		0.60	%
Rojas, Zilma ¹		15,000		500		15,000		0.02	%
Sandler, J & S ¹		8,287		753		8,287		0.01	%
Sandler, Mark and Lori ²		19,305		15,094		19,305		0.03	%
Schnipper, Steve ²⁴		62,379		19,955		62,379		0.10	%
Schwartz, Eric ¹		5,496		500		5,496		0.01	%
Seren, Stanley ¹		753		753		753		0.00	%
Shapiro, Alex ¹		10,219		10,219		10,219		0.02	%
Siderowf, Richard ^2,25		53,221		28,377		53,221		0.09	%
Siebert Best, Ellen ²		37,322		2,140		37,322		0.06	%
Siebert, Lawrence ²⁶		7,289,605		-		7,289,605		11.58	%
Sive Paget & Reisel ¹		2,055		187		2,055		0.00	%
Smith, Robin ^1,27		34,000		34,000		34,000		0.06	%
Spatacco, Jr., Anthony J. ²⁸		73,836		72,304		73,836		0.12	%
Speer, Sandy ¹		86,002		349		86,002		0.14	%
Spilka, R. Edward ^2,29		369,277		100,000		369,277		0.61	%
Starboard Capital Markets, LLC ³⁰		17,588		12,931		17,588		0.03	%
Starobin Partners ^1,5		90,000		90,000		90,000		0.15	%
Straightline Capital Opportunities Fund I, LLC ²		555,805		60,566		555,805		0.92	%
Talesnick, Alan L. ^2,31		295,349		94,930		295,349		0.49	%
TCMP3 Partners		294,350		23,507		294,350		0.49	%
Thunderbird Global Corporation ^2,32		85,710		45,638		85,710		0.14	%
Total M.I.S., Inc. ²		694,222		300,000		694,222		1.14	%
Tyson, John ^2,33		16,250		16,250		16,250		0.03	%
Vicis Capital Master Fund ^2,34		4,565,029		452,830		4,565,029		7.54	%
Wachs, Mark ²		2,916		2,281		2,916		0.00	%
Weiss, Gunther ¹		28,334		2,576		28,334		0.05	%
Westbury Diagnostics, Inc. ²		186,832		77,403		186,832		0.31	%

		56,917,952		15,720,961		56,917,952

(A) Includes shares underling warrants and/or options held by the selling security holder that are covered by this prospectus, including any warrants and/or options that, due to contractual restrictions, may not be exercisable within 60 days of the date of this prospectus..

(B) The number of shares of common stock to be sold assumes that the selling security holder elects to sell all the shares of common stock held by the selling security holder that are covered by this prospectus.

(C) It is our understanding that any selling security holder that is an affiliate of a broker-dealer purchased the securities offered hereunder in the ordinary course of business, and at the time of the purchase, had no agreements or understanding to distribute the securities.

[1] The sale of all of these shares is currently registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement in a single joint prospectus.

[2] The sale of all of these shares, except for less than 235,000 that represent dividend shares, currently is registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement, in a single joint prospectus.

[3] Konrad Ackerman has ultimate control over Alpha Capital AG and the shares held by Alpha Capital AG.

[4] Provides marketing consulting services to the Company.

[5] Affiliated with Wellfleet Partners.

[6] Affiliated with HC Wainwright, investment banking services.

[7]Affiliated with Dillion Capital, a NASD member. Robert Hoyt has ultimate control over Crestview Capital Master, LLC and the shares held by Crestview Capital Master, LLC.

[8] Affiliated with Midtown Partners & Co., LLC, investment banking services.

[9] DKR SoundShore Oasis Holding Fund Ltd. (the “Fund”) is a master fund in a master-feeder structure. The Fund’s investment manager is DKR Oasis Management Company LP (the “Investment Manager”). Pursuant to an investment management agreement among the Fund, the feeder funds and the Investment Manager, the Investment Manager has the authority to do any and all acts on behalf of the Fund, including voting any shares held by the Fund. Mr. Seth Fischer is the managing partner of Oasis Management Holdings LLC, one of the general partners of the Investment Manager. Mr. Fischer has ultimate responsibility for trading with respect to the Fund. Mr. Fischer disclaims beneficial ownership of the shares.

[10] Christopher Eckert is an employee of Smith Barney.

[11] Affiliated with Wellfleet Partners and Starobin Partners, investment banking services.

[12] Former Director of CDS.

[13] NASD member.

[14] Former President of CDS and Director.

[15] Employee of Starboard Capital Markets, LLC, investment banking services.

[16] Assisted the Company in fundraising.

[17] Former Director of CDS.

[18] Employee of Midtown Partners & Co., LLC, investment banking services.

[19] Affiliated with Needham & Company, investment banking services, until February 4, 2005.

[20] Except for 26,393 shares, the sale of these shares is registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement, in a single joint prospectus.

[21] Except for 81,582 shares, the sale of these shares is registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement, in a single joint prospectus.

[22] NASD member, assisted the Company in fundraising.

[23] Fred Fraenkel and Udi Toledano have ultimate control over Millennium 3 Opportunity Fund and the shares held by Millennium 3 Opportunity Fund.

[24] Except for 51,578 shares, the sale of these shares is registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement, in a single joint prospectus.

[25] Registered sales representative with RBC Dain Rauscher.

[26] Except for 663,078 shares, the sale of these shares is registered under Chembio’s Registration Statement on Form SB-2 that became effective with the SEC on November 4, 2004. The sale of these shares also is included in this Prospectus so that Chembio can make any future amendments for the Registration Statement of which this Prospectus is a part, together with amendments of the 2004 Registration Statement, in a single joint prospectus.

[27] Provided marketing consulting services; affiliated with Wellfleet Partners and Starobin Partners.

[28] Assisted the Company in fundraising; employee of Starboard Capital Markets LLC.

[29] Stockholder of Lehman Brothers.

[30] NASD member.

[31] Partner at Patton Boggs LLP, our legal counsel.

[32] WSITE International Foundation (“WSITE”) is the ultimate beneficiary of Thunderbird Global Corporation. Gustavo Montilla is the Chairman of WSITE International Foundation and controls the daily affairs of WSITE.

[33] Provides marketing consulting services.

[34] Vicis Capital Master Fund’s investment manager is Vicis Capital, LLC. Shad Stastney, John Succo, and Sky Lucas have the ultimate control over the shares held by Vicis Capital Master Fund.