As
filed
with the Securities and Exchange Commission on May 13, 2008
Registration
No. _________
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
SYNVISTA
THERAPEUTICS, INC.
(Exact
name of registrant as specified in its charter)
Delaware
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13-3304550
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(State
or other jurisdiction of
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|
(I.R.S.
Employer
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incorporation
or organization)
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|
Identification
Number)
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221
West Grand Avenue
Suite
200
Montvale,
New Jersey 07645
(201) 934-5000
(Address,
including zip code, and telephone number, including area code, of registrant’s
principal executive offices)
Noah
Berkowitz, M.D., Ph.D.
President
and Chief Executive Officer
Synvista
Therapeutics, Inc.
221
West Grand Avenue
Suite
200
Montvale,
New Jersey 07645
(201) 934-5000
(Name,
address, including zip code, and telephone number, including area code, of
agent
for service)
with
copies to:
Megan
N. Gates, Esq.
Mintz,
Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
One
Financial Center
Boston,
Massachusetts 02111
(617) 542-6000
Approximate
date of commencement of proposed sale to the public:
From
time to time after this Registration Statement becomes effective.
If
the
only securities being registered on this Form are being offered pursuant to
dividend or interest reinvestment plans, please check the following
box.
o
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.þ
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.
o
__________
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. o __________
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. o
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.
o
Indicate
by check mark whether the registrant is a
large
accelerated filer, an
accelerated filer
a
non-accelerated filer, or a smaller reporting company. See definitions of “large
accelerated filer,” accelerated filer” and “smaller reporting company” in Rule
12b-2 of the Exchange Act.
Large
accelerated filer o Accelerated
filer o Non-accelerated filer
o (Do
not check if a smaller
reporting company)
Smaller
reporting company x
CALCULATION
OF REGISTRATION FEE
Title of each class of securities to be registered
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|
Amount to be
registered (1)
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|
Proposed
maximum
offering price
per share (2)
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|
Proposed
maximum
aggregate
offering price
(2)
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|
Amount of
registration fee
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|
Common
Stock, $0.01 par value per share
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643,918
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|
$ |
1.87 |
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$ |
1,204,127 |
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$ |
25.31 |
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Rights
to Purchase Series A Preferred Stock
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|
|
(3
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)
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|
(3
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)
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|
(3
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)
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|
None
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|
(1)
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Consists
of 613,297 shares of common stock issuable upon conversion of a portion
of
the shares of Series B Preferred Stock sold as part of a private
placement
transaction as described herein, and 30,621 shares of common stock
issuable upon exercise of warrants to purchase shares
of our common stock issued in the same private placement.
Pursuant to Rule 416 under the Securities Act of 1933, as amended,
this
Registration Statement also covers such number of additional shares
of
common stock as may be issuable in order to prevent dilution resulting
from stock splits, dividends or other distributions, recapitalizations
or
similar events.
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(2)
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Estimated
solely for the purpose of determining the registration fee pursuant
to
Rule 457(c) under the Securities Act of 1933, based upon the average
of
the high and low prices for the common stock of Synvista Therapeutics,
Inc. on May 9, 2008, as reported by the American Stock
Exchange.
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(3)
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No
separate consideration will be received for the Rights, which are
attached
to the shares of common stock.
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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 Section 8(a),
may determine.
The
information in this prospectus is not complete and may be changed. The selling
stockholders may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and it is not soliciting an offer
to
buy these securities in any state where the offer or sale is not
permitted.
SUBJECT
TO COMPLETION, DATED MAY 13, 2008
PROSPECTUS
SYNVISTA
THERAPEUTICS, INC.
643,918
SHARES OF COMMON STOCK
We
sold
10 million shares of our Series B Preferred Stock, $0.01 par value per share
(the “Series B Preferred Stock”) and warrants to purchase 2.5 million shares of
our Series B Preferred Stock (the “Warrants”) for an aggregate purchase price of
approximately $25 million in a private placement to accredited institutional
investors which closed on July 25, 2007. This prospectus relates to the resale
from time to time of a total of 613,297 shares of our common stock, $0.01 par
value per share, issuable upon conversion of the shares of Series B Preferred
Stock, as well as 30,621 shares of our common stock issuable upon exercise
of warrants to purchase our common stock issued to the placement
agent in the private placement immediately following the closing of the
sale of our Series B Preferred Stock, by the selling stockholders
described in the section entitled “Selling Stockholders” on page 15 of this
prospectus.
The
selling stockholders will receive all of the proceeds from the disposition
of
the shares or interests therein and will pay any underwriting discounts and
selling commissions relating thereto. We have agreed to pay the legal,
accounting, printing and other expenses related to the registration of the
shares.
Our
common stock is listed on the American Stock Exchange under the symbol “SYI.” On
May 12, 2008 the last reported sale price of our common stock was $1.87 per
share. Our principal executive offices are located at 221 West Grand Avenue,
Suite 200, Montvale, New Jersey 07645, and our telephone number is (201)
934-5000.
The
selling stockholders or their pledges, assignees or successors-in-interest
may
offer and sell or otherwise dispose of the shares of common stock described
in
this prospectus from time to time through public or private transactions at
prevailing market prices, at prices related to prevailing market prices or
at
privately negotiated prices. See “Plan of Distribution” beginning on
page 19 for more information about how the selling stockholders may sell or
dispose of their shares of common stock.
The
selling stockholders may resell the common stock to or through underwriters,
broker-dealers or agents, who may receive compensation in the form of discounts,
concessions or commissions.
You
should consider carefully the risks that we have described in
“Risk
Factors”
beginning on page 3 before deciding whether to invest in our common
stock.
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 __________, 2008
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
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1
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OUR
BUSINESS
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1
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RISK
FACTORS
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3
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FORWARD-LOOKING
STATEMENTS AND CAUTIONARY STATEMENTS
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15
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USE
OF PROCEEDS
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15
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SELLING
STOCKHOLDERS
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15
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PLAN
OF DISTRIBUTION
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19
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LEGAL
MATTERS
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20
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EXPERTS
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21
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WHERE
YOU CAN FIND MORE INFORMATION
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21
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INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE
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21
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ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement on Form S-3 that we filed with
the Securities and Exchange Commission using a “shelf” registration or
continuous offering process. Under this shelf process, certain selling
stockholders may from time to time sell the shares of common stock described
in
this prospectus in one or more offerings.
You
should read this prospectus and the information and documents incorporated
by
reference carefully. Such documents contain important information you should
consider when making your investment decision. See “Incorporation of Certain
Documents by Reference” on page 21. You should rely only on the information
provided in this prospectus or documents incorporated by reference into this
prospectus. We have not, and the selling stockholders have not, authorized
anyone to provide you with different information. The selling stockholders
are
offering to sell and seeking offers to buy shares of our common stock only
in
jurisdictions in which offers and sales are permitted. The information contained
in this prospectus is accurate only as of the date of this prospectus,
regardless of the time of delivery of this prospectus or of any sale of our
common stock.
In
this
prospectus, we refer to Synvista Therapeutics, Inc. as “we,” “us,” “our,” the
“Company” or “Synvista.” Reference to “selling stockholders” refers to those
stockholders listed herein under “Selling Stockholders,” who may sell shares
from time to time as described in this prospectus. All trade names used in
this prospectus are either our registered trademarks or trademarks of their
respective holders.
OUR
BUSINESS
The
following is only a summary and therefore does not contain all of the
information you should consider before investing in our securities. We urge
you
to read this entire prospectus, including the more detailed consolidated
financial statements, notes to the consolidated financial statements and other
information incorporated by reference from our other filings with the Securities
and Exchange Commission. Investing in our common stock involves risks.
Therefore, please carefully consider the information provided under the heading
“Risk Factors” beginning on page 3.
Overview
Synvista
Therapeutics, Inc. (“we,” “us,” “our,” “Synvista” or the “Company”) is a
product-based biotechnology company engaged in the development of diagnostic
tests and drugs to identify and treat diabetic patients at high risk for the
development of cardiovascular disease. We have identified several promising
product candidates that we believe represent novel approaches for diagnosis
and
treatment in some of the largest pharmaceutical markets. Currently we are
advancing the development and commercialization of a diagnostic product and
two
of our drug candidates are in Phase 2 clinical trials.
We
are
developing a diagnostic kit to identify the subset of patients with diabetes
who
are at increased risk for cardiovascular disease. The technology underlying
this
kit relates to a serum protein called haptoglobin (“Hp”). A common variant of
this protein, known as Hp2-2, which is found in 40% of the population, is
associated with increased cardiovascular risk in diabetic patients. Further,
it
has been shown that this protein variant may identify those diabetic patients
for whom daily use of vitamin E could potentially reduce the rate of heart
attack by 50%. We are developing a kit to identify this high risk variant of
haptoglobin. Any successful commercialization of such a kit could generate
revenues for us in future years and could help focus the development of one
of
our therapeutic product candidates, ALT-2074, described below. We believe that
this test and ancillary items may be useful also in supporting a treatment
plan
for diabetics, particularly those diabetics with Hp2-2. Pending completion
of
development and regulatory approval, we expect to begin commercial sales of
the
diagnostic assay by mid-2009.
We
are
also managing a discovery and development program aiming to produce small
molecule drugs that mimic the enzyme glutathione peroxidase (“GPx”). We believe
that GPx is one of the only enzymes in the human body that reduce oxidized
lipids. By recreating the activity of this enzyme in a small molecule, we may
be
able to treat diseases in which oxidized lipids are thought to play a
significant role including atherosclerosis, nephropathy (kidney disease) and
degenerative central nervous system diseases, such as Alzheimer’s
Disease.
One
of
our GPx mimetics, ALT-2074, is in Phase 2 clinical trials. Our intention is
to
focus this product candidate on the treatment of diabetic patients with Hp2-2.
These patients have a markedly elevated rate of heart failure and death
following a heart attack, which may relate to elevated levels of oxidized lipids
and consequent atherosclerosis. Our goal for ALT-2074 is to develop it for
use
in the treatment of acute coronary syndrome (“ACS”) and explore its
anti-atherosclerotic activity in Hp2-2, diabetic patients.
Our
two
ongoing Phase 2 studies of ALT-2074 are designed to prepare for a pivotal study.
Our first study uses ALT-2074 in Hp2-2, diabetic patients. The drug or placebo
is being administered orally in ascending doses for 28 days as we track
inflammatory biomarkers and functional improvement in cholesterol efflux. This
assay tests the ability of high density lipoprotein (“HDL”) to pull cholesterol
out of cells in the body known as macrophages. This ability may protect the
vasculature from accumulating atherosclerotic plaque. Results from this study
are anticipated in the second quarter of 2008. In addition, we are conducting
a
Phase 2 clinical trial in diabetic patients undergoing angioplasty to see
whether ALT-2074 can protect heart muscle that is not receiving adequate blood
supply. We expect to complete this study in the second quarter of 2008 as
well.
ALT-2074
has demonstrated potential efficacy in a 20-patient clinical trial in ulcerative
colitis.
Alagebrium
chloride or alagebrium (formerly ALT-711), is an Advanced Glycation End-product
Crosslink Breaker being developed for diastolic heart failure (“DHF”). To date,
alagebrium has demonstrated potential efficacy in two Phase 2 clinical trials
in
heart failure, as well as in animal models of heart failure, nephropathy,
hypertension and erectile dysfunction (“ED”). The compound has been tested in
approximately 1,000 patients, which represents a sizeable human safety database.
Our goal is to develop alagebrium in DHF and nephropathy. These diseases
represent a rapidly growing market of unmet medical needs, and are particularly
common among diabetic patients.
Sale
of Series B Preferred Stock
On
July
25, 2007, we closed a private placement of shares of our Series B Preferred
Stock. At the closing of the financing, we issued 10,000,000 shares of our
Series B Preferred Stock to the buyers. In connection with the closing of the
financing, we also issued warrants to purchase 2,500,000 shares of Series B
Preferred Stock to the buyers, and warrants to purchase 600,000 shares of common
stock to the placement agent in the private placement, all of which warrants
are
exercisable for a period of five years commencing on July 25, 2007 at an
exercise price of $2.50 per share. This prospectus relates to 643,918
shares of our common stock that are issuable upon conversion of 613,297of the
shares of Series B Preferred Stock that we issued on July 25, 2007, along with
30,621 shares of our common stock that are issuable upon exercise of warrants
issued to the placement agent in the private placement.
On
September 7, 2007, we filed a separate Registration Statement on Form S-3,
which
was declared effective on November 13, 2007, relating to the resale of 598,391
shares of our common stock issuable upon conversion of shares of Series B
Preferred Stock and 29,877 shares of our common stock issuable upon exercise
of
warrants issued to the placement agent. The registration statement of which
this
prospectus forms a part registers additional shares of common stock underlying
shares of Series B Preferred Stock issued pursuant to the same
transaction.
We
relied
upon the exemptions from registration provided by Section 4(2) of the Securities
Act of 1933, as amended (the “Securities Act”) and Regulation D promulgated
under that section. Each investor represented that it was an accredited
investor, as such term is defined in Regulation D under the Securities Act,
and
that it was acquiring the common stock and warrants for its own account and
not
with a view to or for sale in connection with any distribution thereof, and
appropriate legends are affixed to the common stock and warrants.
The
Series B Preferred Stock is convertible into shares of common stock at the
option of the holder at any time and is subject to automatic conversion into
shares of common stock as further described in "Selling
Stockholders-Conversion." The Series B Preferred Stock contains rights and
preferences that are superior to those of our common stock, including cumulative
dividends at an annual rate of 8% of the original issue price of the Series
B
Preferred Stock for a period of 5 years from the date of issuance, a liquidation
preference, weighted-average anti-dilution protection, and other rights. Holders
of Series B Preferred Stock are entitled to cast the number of votes equal
to
one-half of the number of shares of common stock into which their Series B
Preferred Stock would be convertible on the applicable record date. At any
time
when any shares of Series B Preferred Stock remain outstanding, we may not,
without the consent of the holders of a majority of the shares held by holders
of at least $4,000,000 (measured as of the original issue date) worth of Series
B Preferred Stock:
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incur
debt in excess of $2,000,000,
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authorize
securities at a price per share less than the price per share at
which the
Series B Preferred Stock has been sold under the Purchase
Agreement,
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increase
our authorized capital,
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create
any new classes or series of stock with rights senior to the common
stock,
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issue
any shares of our Series A Preferred Stock, other than in accordance
with
our shareholder rights plan,
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amend
any provision of our Certificate of Incorporation or Bylaws that
changes
the rights of the Series B Preferred
Stock,
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pay
or declare any dividend on any of our capital
stock,
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purchase
or redeem any securities,
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issue
any securities to employees other than pursuant to our 2005 Stock
Plan, or
increase the number of shares of common stock reserved for issuance
under
the 2005 Stock Plan,
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liquidate,
dissolve or wind-up,
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merge
with another entity,
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sell
or dispose of any of our assets, including the sale or license of
our
intellectual property,
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change
the number of directors,
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amend
any portion of our Certificate of Incorporation or
Bylaws,
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materially
change the nature of our business,
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intentionally
take any action that may result in our stock no longer being approved
for
quotation on the American Stock Exchange or NASDAQ, or that would
cause
our common stock to no longer be registered pursuant to Section 12
of the
Securities Exchange Act of 1934, as amended,
or
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amend
any material agreement that has been filed with the Securities and
Exchange Commission.
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We
were
incorporated in Delaware in October 1986. Our headquarters are located at 221
West Grand Avenue, Suite 200, Montvale, New Jersey 07645. We maintain a web
site
at www.synvista.com
and our
telephone number is (201) 934-5000. Our annual reports on Form 10-K, our
quarterly reports on Form 10-Q, our current reports on Form 8-K, and all
amendments to those reports, are available to you free of charge through the
“Investor Relations” section of our website as soon as reasonably practicable
after such materials have been electronically filed with, or furnished to,
the
Securities and Exchange Commission (“SEC”).
RISK
FACTORS
The
following factors should be considered carefully in evaluating whether to
purchase shares of Synvista common stock. These factors should be considered
in
conjunction with any other information included or incorporated by reference
herein, including in conjunction with forward-looking statements made herein.
See “Where You Can Find More Information” on page 21.
Risks
Related To Our Business
We
will continue to need additional capital, but access to such capital is
uncertain.
As
of
December 31, 2007, we had cash and cash equivalents on hand of approximately
$15,646,000. Our future capital needs will depend on many factors, including
our
research and development activities and the success thereof, the scope of our
clinical trial programs, the timing of regulatory approval for our products
under development and the successful commercialization of our products. Our
needs may also depend on the magnitude and scope of our activities, the progress
and the level of success in our clinical trials, the costs of preparing, filing,
prosecuting, maintaining and enforcing patent claims and other intellectual
property rights, competing technological and market developments, changes in
or
terminations of existing collaboration and licensing arrangements, the
establishment of new collaboration and licensing arrangements and the cost
of
manufacturing scale-up and development of marketing activities, if undertaken
by
us. In addition, the holders of our Series B Preferred Stock have the option
to
receive dividends in the form of cash or additional shares of Series B Preferred
Stock. The amount of funds that we will have available in the future for the
development of our product candidates may be reduced if the holders of our
Series B Preferred Stock choose to receive dividends in the form of cash. We
currently do not have committed external sources of funding and may not be
able
to secure additional funding on any terms or on terms that are favorable to
us.
If we raise additional funds by issuing additional stock, further dilution
to
our existing stockholders will result, and new investors may negotiate for
rights superior to existing stockholders. If adequate funds are not available,
we may be required to:
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delay,
reduce the scope of or eliminate one or more of our development
programs;
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obtain
funds through arrangements with collaboration partners or others
that may
require us to relinquish rights to some or all of our technologies,
product candidates or products that we would otherwise seek to develop
or
commercialize ourselves;
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license
rights to technologies, product candidates or products on terms that
are
less favorable to us than might otherwise be
available;
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seek
a buyer for all or a portion of our business;
or
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wind
down our operations and liquidate our assets on terms that are unfavorable
to us.
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We
have historically incurred operating losses and we expect these losses to
continue.
We
have
historically incurred substantial operating losses due to our research and
development and other operating activities and expect these losses to continue
for the foreseeable future. As of December 31, 2007, we had an accumulated
deficit of $263,092,520. Our net losses during fiscal years 2007 and 2006 were
$16,093,023 and $17,679,737, respectively. Our net losses applicable to common
stockholders during fiscal years 2007 and 2006 were $19,946,659 and $20,332,416,
respectively. We expect to expend significant amounts on research and
development programs for alagebrium and ALT-2074. Research and development
activities are time consuming and expensive, and will involve the need to engage
in additional fund-raising activities, identify appropriate strategic and
collaborative partners, reach agreement on basic terms, and negotiate and sign
definitive agreements. We expect to continue to incur significant operating
losses for the foreseeable future.
Clinical
studies required for our product candidates are time-consuming, and their
outcome is uncertain.
Before
obtaining regulatory approvals for the commercial sale of any of our products
under development, we must demonstrate through preclinical and clinical studies
that the product is safe and effective for use in each target indication.
Success in preclinical studies of a product candidate may not be predictive
of
similar results in humans during clinical trials. None of our products has
been
approved for commercialization in the United States or elsewhere. In December
2004, we announced that findings of a routine two-year rodent toxicity study
indicated that male Sprague Dawley rats exposed to high doses of alagebrium
over
their natural lifetime developed dose-related increases in liver cell
alterations and tumors, and that the liver tumor rate was slightly over the
expected background rate in this gender and species of rat. In February 2005,
based on the initial results from one of the follow-on preclinical toxicity
experiments, we voluntarily and temporarily suspended enrollment of new subjects
into each of the ongoing clinical studies pending receipt of additional
preclinical data. We withdrew our investigational new drug application, or
IND,
for the EMERALD (Efficacy
and Safety of Alagebrium
in
Erectile
Dysfunction in Male
Diabetics)
study in February 2006 in order to focus our resources on the development of
alagebrium in cardiovascular indications. We subsequently submitted an IND
to
the Cardio-Renal Division of the U.S. Food and Drug Administration, or FDA,
for
a trial using alagebrium to treat heart failure. The FDA has indicated that
we
may proceed with trials in this indication. The BENEFICIAL trial, a
double-blind, placebo-controlled, randomized trial evaluating the efficacy
and
safety of alagebrium in patients with chronic heart failure, was planned and
submitted under a Clinical Trial Application in the Netherlands, where the
health authorities have permitted us to proceed with initiation of the study.
Freedom to initiate clinical studies does not mean that regulatory agencies
will
not require additional explanation of the two-year rodent toxicity study.
If
we do
not prove in clinical trials that our product candidates are safe and effective,
we will not obtain marketing approvals from the FDA and other applicable
regulatory authorities. In particular, one or more of our product candidates
may
not exhibit the expected medical benefits in humans, may cause harmful side
effects, may not be effective in treating the targeted indication or may have
other unexpected characteristics that preclude regulatory approval for any
or
all indications of use or limit commercial use if approved.
The
length of time necessary to complete clinical trials varies significantly and
is
difficult to predict. Factors that can cause delay or termination of our
clinical trials include:
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slower
than expected patient enrollment due to the nature of the protocol,
the
proximity of subjects to clinical sites, the eligibility criteria
for the
study, competition with clinical trials for other drug candidates
or other
factors;
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adverse
results in preclinical safety or toxicity
studies;
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lower
than expected recruitment or retention rates of subjects in a clinical
trial;
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inadequately
trained or insufficient personnel at the study site to assist in
overseeing and monitoring clinical
trials;
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delays
in approvals from a study site’s review board, or other required
approvals;
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longer
treatment time required to demonstrate effectiveness or determine
the
appropriate product dose;
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lack
of sufficient supplies of the product
candidate;
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adverse
medical events or side effects in treated
subjects;
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lack
of effectiveness of the product candidate being tested;
and
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Even
if
we obtain positive results from preclinical or clinical studies for a particular
product, we may not achieve the same success in future studies of that product.
Data obtained from preclinical and clinical studies are susceptible to varying
interpretations that could delay, limit or prevent regulatory approval. In
addition, we may encounter delays or rejections based upon changes in FDA policy
for drug approval during the period of product development and FDA regulatory
review of each submitted new drug application. We may encounter similar delays
in foreign countries. Moreover, regulatory approval may entail limitations
on
the indicated uses of the drug. Failure to obtain requisite governmental
approvals or failure to obtain approvals of the scope requested will delay
or
preclude our licensees or marketing partners from marketing our products or
limit the commercial use of such products and will have a material adverse
effect on our business, financial condition and results of operations.
In
addition, some or all of the clinical trials we undertake may not demonstrate
sufficient safety and efficacy to obtain the requisite regulatory approvals,
which could prevent or delay the creation of marketable products. Our product
development costs will increase if we have delays in testing or approvals,
if we
need to perform more, larger or different clinical or preclinical trials than
planned or if our trials are not successful. Delays in our clinical trials
may
harm our financial results and the commercial prospects for our products.
The
FDA
regulates the development, testing, manufacture, distribution, labeling and
promotion of pharmaceutical products in the United States pursuant to the
Federal Food, Drug, and Cosmetic Act and related regulations. We must receive
pre-market approval by the FDA prior to any commercial sale of any drug
candidates. Before receiving such approval, we must provide preclinical data
and
proof in human clinical trials of the safety and efficacy of our drug
candidates, which trials can take several years. In addition, we must show
that
we can produce any drug candidates consistently at quality levels sufficient
for
administration in humans. Pre-market approval is a lengthy and expensive
process. We may not be able to obtain FDA approval for any commercial sale
of
any drug candidate. By statute and regulation, the FDA has 180 days to
review an application for approval to market a drug candidate; however, the
FDA
frequently exceeds the 180-day time period, at times taking up to
18 months. In addition, based on its review, the FDA or other regulatory
bodies may determine that additional clinical trials or preclinical data are
required. Except for any potential licensing or marketing arrangements with
other pharmaceutical or biotechnology companies, we will not generate any
revenues in connection with any of our drug candidates unless and until we
obtain FDA approval to sell such products in commercial quantities for human
application.
Even
if a
clinical trial is commenced, the FDA may delay, limit, suspend or terminate
clinical trials at any time, or may delay, condition or reject approval of
any
of our product candidates, for many reasons. For example:
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ongoing
preclinical or clinical study results may indicate that the product
candidate is not safe or effective;
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the
FDA may interpret our preclinical or clinical study results to indicate
that the product candidate is not safe or effective, even if we interpret
the results differently; or
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the
FDA may deem the processes and facilities that our collaborative
partners,
our third-party manufacturers or we propose to use in connection
with the
manufacture of the product candidate to be
unacceptable.
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Our
success will largely depend on the development of ALT-2074 or alagebrium, and
we
cannot be sure that the efforts to commercialize ALT-2074 or alagebrium will
succeed.
ALT-2074
and alagebrium are still in early clinical trials and any success to date should
not be seen as indicative of the probability of any future success. The failure
to complete clinical development and commercialize ALT-2074 or alagebrium for
any reason or due to a combination of reasons will have a material adverse
impact on our business.
We
are
dependent on the successful outcome of clinical trials and will not be able
to
successfully develop and commercialize products if clinical trials are not
successful.
We
received approval from Israel’s Ministry of Health to conduct Phase 2 trials of
ALT-2074 in diabetic patients recovering from a recent myocardial infarction
or
acute coronary syndrome. The purpose of the study is to evaluate the biological
effects on cardiac tissue in patients treated with ALT-2074. The study was
opened for enrollment in May 2006 and we now have six sites open for enrollment.
Recruitment has been slow and while we predict that the study will be completed
in the first half of 2008, we can neither guarantee its completion nor the
likelihood of gaining positive results. The same is true for the biomarker
study
using ALT-2074 which begun in June 2007.
We
are developing a diagnostic kit and our efforts may never lead to a product
which gains regulatory approval or is commercialized.
We
are in
the early stage of developing a diagnostic kit to identify the subset of
patients with diabetes who are at increased risk for cardiovascular disease.
The
technology underlying this kit relates to a serum protein called haptoglobin,
or
Hp. A common variant of this protein, known as Hp2-2, which is found in 40%
of
the population, is associated with increased cardiovascular risk in diabetic
patients. We are developing a kit to identify this variant of haptoglobin.
Successful commercialization of such a kit could generate revenues for us in
future years and could help focus the development of our therapeutic product
candidate, ALT-2074. However, we cannot assure you that we will succeed in
developing such a kit or obtain the approvals necessary for its
commercialization. Even
if
we obtain the necessary regulatory approvals, we may not succeed in persuading
physicians and others to purchase sufficient quantities of the kit to cover
the
costs of its development. Failure
to
successfully develop and commercialize the kit will have a material adverse
effect on our business.
If
we are unable to form the successful collaborative relationships that our
business strategy requires, our programs will suffer and we may not be able
to
develop products.
Our
strategy for developing and deriving revenues from our products depends, in
large part, upon entering into arrangements with research collaborators,
corporate partners and others. The potential market, preclinical and clinical
study results and safety profile of our product candidates may not be attractive
to potential corporate partners. We face significant competition in seeking
appropriate collaborators, and these collaborations are complex and
time-consuming to negotiate and document. We may not be able to negotiate
collaborations on acceptable terms, or at all. If that were to occur, we may
have to curtail the development of a particular product candidate, reduce or
delay our development program or one or more of our other development programs,
delay our potential commercialization or reduce the scope of our sales or
marketing activities, or increase our expenditures and undertake development
or
commercialization activities at our own expense. If we elect to increase our
expenditures to fund development or commercialization activities on our own,
we
may need to obtain additional capital, which may not be available to us on
acceptable terms, or at all. If we do not have sufficient funds, we will not
be
able to bring our product candidates to market and generate product revenue.
If
we are able to form collaborative relationships, but are unable to maintain
them, our product development may be delayed and disputes over rights to
technology may result.
We
may
form collaborative relationships that, in some cases, will make us dependent
upon outside partners to conduct preclinical testing and clinical studies and
to
provide adequate funding for our development programs.
In
general, collaborations involving our product candidates pose the following
risks to us:
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collaborators
may fail to adequately perform the scientific and preclinical studies
called for under our agreements with
them;
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collaborators
have significant discretion in determining the efforts and resources
that
they will apply to these
collaborations;
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collaborators
may not pursue further development and commercialization of our product
candidates or may elect not to continue or renew research and development
programs based on preclinical or clinical study results, changes
in their
strategic focus or available funding or external factors, such as
an
acquisition that diverts resources or creates competing
priorities;
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collaborators
may delay clinical trials, provide insufficient funding for a clinical
program, stop a clinical study or abandon a product candidate, repeat
or
conduct new clinical trials or require a new formulation of a product
candidate for clinical testing;
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collaborators
could independently develop, or develop with third parties, products
that
compete directly or indirectly with our products or product candidates
if
the collaborators believe that competitive products are more likely
to be
successfully developed or can be commercialized under terms that
are more
economically attractive; collaborators with marketing and distribution
rights to one or more products may not commit enough resources to
their
marketing and distribution;
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collaborators
may not properly maintain or defend our intellectual property rights
or
may use our proprietary information in such a way as to invite litigation
that could jeopardize or invalidate our proprietary information or
expose
us to potential litigation;
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disputes
may arise between us and the collaborators that result in the delay
or
termination of the research, development or commercialization of
our
product candidates or that result in costly litigation or arbitration
that
diverts management attention and resources;
and
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collaborations
may be terminated and, if terminated, may result in a need for additional
capital to pursue further development of the applicable product
candidates.
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In
addition, there have been a significant number of business combinations among
large pharmaceutical companies that have resulted in a reduced number of
potential future collaborators. If a present or future collaborator of ours
were
to be involved in a business combination, the continued pursuit and emphasis
on
our product development program could be delayed, diminished or terminated.
If
we are unable to attract and retain the key personnel on whom our success
depends, our product development, marketing and commercialization plans could
suffer.
We
depend
heavily on the principal members of our management and scientific staff to
realize our strategic goals and operating objectives. We depend on Dr. Noah
Berkowitz as our Chief Executive Officer and Dr. Carl Mendel as our Vice
President of Clinical Development and Chief Medical Officer. The loss of
services in the near term of any of our principal members of management and
scientific staff could impede the achievement of our development priorities.
Furthermore, recruiting and retaining qualified scientific personnel to perform
research and development work in the future will also be critical to our
success, and there is significant competition among companies in our industry
for such personnel. We may be required to provide additional retention and
severance benefits to our employees in the future if we prepare to effect a
strategic transaction, such as a sale or merger with another company. However,
we cannot assure you that we will be able to attract and retain personnel on
acceptable terms given the competition between pharmaceutical and healthcare
companies, universities and non-profit research institutions for experienced
managers and scientists, and given the recent clinical and regulatory setbacks
that we have experienced. In addition, we rely on consultants to assist us
in
formulating our research and development strategy. All of our consultants are
employed by other entities and may have commitments to or consulting or advisory
contracts with those other entities that may limit their availability to us.
If
we do not successfully develop any products, or are unable to derive revenues
from product sales, we will never be profitable.
Virtually
all of our revenues to date have been generated from collaborative research
agreements and investment income. We have not received any revenues from product
sales. We may not realize product revenues on a timely basis, if at all, and
there can be no assurance that we will ever be profitable.
At
December 31, 2007, we had an accumulated deficit of $263,092,520. We anticipate
that we will incur substantial, potentially greater, losses in the future as
we
continue our research, development and clinical studies. We have not yet
requested or received regulatory approval for any product from the FDA or any
other regulatory body. All of our product candidates are still in research,
preclinical or clinical development. We may not succeed in the development
and
marketing of any therapeutic or diagnostic product. We do not have any product
candidates other than alagebrium and ALT-2074 in clinical development, and
there
can be no assurance that we will be able to bring any other compound into
clinical development. Adverse results of any preclinical or clinical study
could
cause us to materially modify our clinical development programs, resulting
in
delays and increased expenditures, or cease development for all or part of
our
ongoing studies of alagebrium.
To
achieve profitable operations, we must, alone or with others, successfully
identify, develop, introduce and market proprietary products. Such products
will
require significant additional investment, development and preclinical and
clinical testing prior to potential regulatory approval and commercialization.
The development of new pharmaceutical products is highly uncertain and
expensive
and subject
to a number of significant risks. Potential products that appear to be promising
at early stages of development may not reach the market for a number of reasons.
Potential products may be found ineffective or cause harmful side effects during
preclinical testing or clinical studies, fail to receive necessary regulatory
approvals, be difficult to manufacture on a large scale, be uneconomical, fail
to achieve market acceptance or be precluded from commercialization by
proprietary rights of third parties. We may not be able to undertake additional
clinical studies. In addition, our product development efforts may not be
successfully completed, we may not have
the
funds to complete any ongoing clinical trials, we may not obtain
regulatory approvals, and our products, if introduced, may not be successfully
marketed or achieve customer acceptance. We do not expect any of our products,
including alagebrium, to be commercially available for a number of years, if
at
all.
Failure
to maintain effective internal control in accordance with Section 404 of the
Sarbanes-Oxley Act of 2002 could have a material adverse effect on our business
and stock price.
We
have
experienced material weaknesses in our internal control over financial reporting
in past periods. We have taken remedial measures to address and correct these
past material weaknesses. However, we cannot assure you that our internal
controls over financial reporting will remain effective for any period of time.
The failure to maintain effective internal control over financial reporting
could have a material adverse effect on our business and stock
price.
Our
product candidates will remain subject to ongoing regulatory review even if
they
receive marketing approval. If we fail to comply with continuing regulations,
we
could lose these approvals and the sale of our products could be suspended.
Even
if
we receive regulatory approval to market a particular product candidate, the
approval could be granted with the condition that we conduct additional costly
post-approval studies or that we limit the indicated uses included in our
labeling. Moreover, the product may later cause adverse effects that limit
or
prevent its widespread use, force us to withdraw it from the market or impede
or
delay our ability to obtain regulatory approvals in additional countries. In
addition, the manufacturer of the product and its facilities will continue
to be
subject to FDA review and periodic inspections to ensure adherence to applicable
regulations. After receiving marketing approval, the manufacturing, labeling,
packaging, adverse event reporting, storage, advertising, promotion and record
keeping related to the product will remain subject to extensive regulatory
requirements. We may be slow to adapt, or we may never adapt, to changes in
existing regulatory requirements or adoption of new regulatory requirements.
If
we
fail to comply with the regulatory requirements of the FDA and other applicable
United States and foreign regulatory authorities or if previously unknown
problems with our products, manufacturers or manufacturing processes are
discovered, we could be subject to administrative or judicially imposed
sanctions, including:
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restrictions
on the products, manufacturers or manufacturing
processes;
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civil
or criminal penalties;
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product
seizures or detentions;
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voluntary
or mandatory product recalls and publicity
requirements;
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suspension
or withdrawal of regulatory
approvals;
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total
or partial suspension of production;
and
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refusal
to approve pending applications for marketing approval of new drugs
or
supplements to approved
applications.
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In
similar fashion to the FDA, foreign regulatory authorities require demonstration
of product quality, safety and efficacy prior to granting authorization for
product registration which allows for distribution of the product for commercial
sale. International organizations, such as the World Health Organization, and
foreign government agencies, including those for the Americas, Middle East,
Europe, Asia and the Pacific, have laws, regulations and guidelines for
reporting and evaluating the data on safety, quality and efficacy of new drug
products. Although most of these laws, regulations and guidelines are very
similar, each of the individual nations reviews all of the information available
on the new drug product and makes an independent determination for product
registration. A finding of product quality, safety or efficiency in one
jurisdiction does not guarantee approval in any other jurisdiction, even if
the
other jurisdiction has similar laws, regulations and guidelines.
If
we cannot successfully form and maintain suitable arrangements with third
parties for the manufacturing of the products we may develop, our ability to
develop or deliver products may be impaired.
We
have
no experience in manufacturing products and do not have manufacturing
facilities. Consequently, we will depend on contract manufacturers for the
production of any products for development and commercial purposes. The
manufacture of our products for clinical trials and commercial purposes is
subject to current good manufacturing practices, or cGMP, regulations
promulgated by the FDA. In the event that we are unable to obtain or retain
third-party manufacturing capabilities for our products, we will not be able
to
commercialize our products as planned. Our reliance on third-party manufacturers
will expose us to risks that could delay or prevent the initiation or completion
of our clinical trials, the submission of applications for regulatory approvals,
the approval of our products by the FDA or the commercialization of our products
or result in higher costs or lost product revenues. In particular, contract
manufacturers:
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could
encounter difficulties in achieving volume production, quality control
and
quality assurance and suffer shortages of qualified personnel, which
could
result in their inability to manufacture sufficient quantities of
drugs to
meet our clinical schedules or to commercialize our product
candidates;
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could
terminate or choose not to renew the manufacturing agreement, based
on
their own business priorities, at a time that is costly or inconvenient
for us;
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could
fail to establish and follow FDA-mandated cGMP, as required for FDA
approval of our product candidates, or fail to document their adherence
to
cGMP, either of which could lead to significant delays in the availability
of material for clinical study and delay or prevent filing or approval
of
marketing applications for our product candidates;
and
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could
breach, or fail to perform as agreed, under the manufacturing
agreement.
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Changing
any manufacturer that we engage for a particular product or product candidate
may be difficult, as the number of potential manufacturers is limited, and
we
will have to compete with third parties for access to those manufacturing
facilities. cGMP processes and procedures typically must be reviewed and
approved by the FDA, and changing manufacturers may require re-validation of
any
new facility for cGMP compliance, which would likely be costly and
time-consuming. We may not be able to engage replacement manufacturers on
acceptable terms quickly or at all. In addition, contract manufacturers located
in foreign countries may be subject to import limitations or bans. As a result,
if any of our contract manufacturers are unable, for whatever reason, to supply
the contracted amounts of our products that we successfully bring to market,
a
shortage would result which would have a negative impact on our revenues.
Drug
manufacturers are subject to ongoing periodic unannounced inspection by the
FDA,
the U.S. Drug Enforcement Agency and corresponding state and foreign agencies
to
ensure strict compliance with cGMP, other government regulations and
corresponding foreign standards. While we are obligated to audit the performance
of third-party contractors, we do not have control over our third-party
manufacturers’ compliance with these regulations and standards. Failure by our
third-party manufacturers or us to comply with applicable regulations could
result in sanctions being imposed on us, including fines, injunctions, civil
penalties, failure of the government to grant pre-market approval of drugs,
delays, suspension or withdrawal of approvals, seizures or recalls of product,
operating restrictions and criminal prosecutions. Our dependence upon others
for
the manufacture of any products that we develop may adversely affect our profit
margin, if any, on the sale of any future products and our ability to develop
and deliver such products on a timely and competitive basis.
If
we are not able to protect the intellectual property rights that are critical
to
our success, the development and any possible sales of our product candidates
could suffer and competitors could force our products completely out of the
market.
Our
success will depend on our ability to obtain patent protection for our products,
preserve our trade secrets, prevent third parties from infringing upon our
proprietary rights and operate without infringing upon the proprietary rights
of
others, both in the United States and abroad.
The
degree of patent protection afforded to pharmaceutical inventions is uncertain
and our potential products are subject to this uncertainty. Competitors may
develop competitive products outside the protection that may be afforded by
the
claims of our patents. We are aware that other parties have been issued patents
and have filed patent applications in the United States and foreign countries
with respect to other agents that have an effect on A.G.E.s, or the formation
of
A.G.E. crosslinks. In addition, although we have several patent applications
pending to protect proprietary technology and potential products, these patents
may not be issued, and the claims of any patents that do issue, may not provide
significant protection of our technology or products. In addition, we may not
enjoy any patent protection beyond the expiration dates of our currently issued
patents.
We
also
rely upon unpatented trade secrets and improvements, unpatented know-how and
continuing technological innovation to maintain, develop and expand our
competitive position, which we seek to protect, in part, by confidentiality
agreements with our corporate partners, collaborators, employees and
consultants. We also have invention or patent assignment agreements with our
employees and certain, but not all, corporate partners and consultants. Relevant
inventions may be developed by a person not bound by an invention assignment
agreement. Binding agreements may be breached, and we may not have adequate
remedies for such breach. In addition, our trade secrets may become known to
or
be independently discovered by competitors.
If
we are unable to operate our business without infringing upon intellectual
property rights of others, we may not be able to operate our business
profitably.
Our
success depends on our ability to operate without infringing upon the
proprietary rights of others. We are aware that patents have been applied for
and/or issued to third parties claiming technologies for A.G.E.s or Glutathione
Peroxidase Mimetics that may be similar to those needed by us. To the extent
that planned or potential products are covered by patents or other intellectual
property rights held by third parties, we would need a license under such
patents or other intellectual property rights to continue development and
marketing of our products. Any required licenses may not be available on
acceptable terms, if at all. If we do not obtain such licenses on reasonable
terms, we may not be able to proceed with the development, manufacture or sale
of our products.
Litigation
may be necessary to defend against claims of infringement or to determine the
scope and validity of the proprietary rights of others. Litigation or
interference proceedings could result in substantial additional costs and
diversion of management focus. If we are ultimately unsuccessful in defending
against claims of infringement, we may be unable to operate profitably.
ALT-2074
and other compounds are licensed by third parties and if we are unable to
continue licensing this technology, our future prospects may be materially
adversely affected.
We
are a
party to various license agreements with third parties that give us exclusive
and partial exclusive rights to use specified technologies applicable to
research, development and commercialization of our products, including
alagebrium and ALT-2074. We anticipate that we will continue to license
technology from third parties in the future. To maintain the license for certain
technology related to ALT-2074 that we received from OXIS, we are obligated
to
meet certain development and clinical trial milestones and to make certain
payments. There can be no assurance that we will be able to meet any milestone
or make any payment required under the license with OXIS. In addition, if we
fail to meet any milestone or make any payment, there can be no assurance that
we may be able to negotiate an arrangement with OXIS, as we have successfully
done in the past, whereby we will continue to have access to the ALT-2074
technology.
The
technology that our subsidiary HaptoGuard licensed from third parties would
be
difficult or impossible to replace and the loss of this technology would
materially adversely affect our business, financial condition and any future
prospects.
If
we are not able to compete successfully with other companies in the development
and marketing of cures and therapies for cardiovascular diseases, diabetes,
and
the other conditions for which we seek to develop products, we may not be able
to continue our operations.
We
are
engaged in pharmaceutical fields characterized by extensive research efforts
and
rapid technological progress. Many established pharmaceutical and biotechnology
companies with financial, technical and human resources greater than ours are
attempting to develop, or have developed, products that would be competitive
with our products. Many of these companies have extensive experience in
preclinical and human clinical studies. Other companies may succeed in
developing products that are safer, more efficacious or less costly than any
we
may develop and may also be more successful than us in production and marketing.
Rapid technological development by others may result in our products becoming
obsolete before we recover a significant portion of the research, development
or
commercialization expenses incurred with respect to those products.
Certain
technologies under development by other pharmaceutical companies could result
in
better treatments for cardiovascular disease, and diabetes and its related
complications. Several large companies have initiated or expanded research,
development and licensing efforts to build pharmaceutical franchises focusing
on
these medical conditions, and some companies already have products approved
and
available for commercial sale to treat these indications. It is possible that
one or more of these initiatives may reduce or eliminate the market for some
of
our products. In addition, other companies have initiated research in the
inhibition or crosslink breaking of A.G.E.s.
Our
ability to compete successfully against currently existing and future
alternatives to our product candidates and systems, and competitors who compete
directly with us in the small molecule drug industry will depend, in part,
on
our ability to:
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attract
and retain skilled scientific and research personnel;
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develop
technologically superior products;
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develop
competitively priced products;
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obtain
patent or other required regulatory approvals for our products;
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be
early entrants to the market; and
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manufacture,
market and sell our products, independently or through
collaborations.
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We
depend on third parties for research and development activities necessary to
commercialize certain of our patents.
We
utilize the services of several scientific and technical consultants to oversee
various aspects of our protocol design, clinical trial oversight and other
research and development functions. We contract most of our research and
development operations using third-party contract manufacturers for drug
inventory and shipping services and third-party contract research organizations
in connection with preclinical and/or clinical studies in accordance with our
designed protocols, as well as conducting research at medical and academic
centers.
Because
we rely on third parties for much of our research and development work, we
have
less direct control over our research and development. We face risks that these
third parties may not be appropriately responsive to our time frames and
development needs and could devote resources to other customers. In addition,
certain of these third parties may have to comply with FDA regulations or other
regulatory requirements in the conduct of this research and development work,
which they may fail to do.
If
governments and third-party payers continue their efforts to contain or decrease
the costs of healthcare, we may not be able to commercialize our products
successfully.
In
the
United States, we expect that there will continue to be federal and state
initiatives to control and/or reduce pharmaceutical expenditures. In certain
foreign markets, pricing and/or profitability of prescription pharmaceuticals
are subject to government control. In addition, increasing emphasis on managed
care in the United States will continue to put pressure on pharmaceutical
pricing. Cost control initiatives could decrease the price that we receive
for
any products for which we may receive regulatory approval to develop and sell
in
the future and could have a material adverse effect on our business, financial
condition and results of operations. Further, to the extent that cost control
initiatives have a material adverse effect on our corporate partners, our
ability to commercialize our products may be adversely affected.
Our
ability to commercialize pharmaceutical products may depend, in part, on the
extent to which reimbursement for the products will be available from government
health administration authorities, private health insurers and other third-party
payers. Significant uncertainty exists as to the reimbursement status of newly
approved healthcare products, and third-party payers, including Medicare,
frequently challenge the prices charged for medical products and services.
In
addition, third-party insurance coverage may not be available to subjects for
any products developed by us. Government and other third-party payers are
attempting to contain healthcare costs by limiting both coverage and the level
of reimbursement for new therapeutic products and by refusing in some cases
to
provide coverage for uses of approved products for disease indications for
which
the FDA has not granted labeling approval. If government and other third-party
payers for our products do not provide adequate coverage and reimbursement
levels, the market acceptance of these products would be adversely affected.
If
the users of the products that we are developing claim that our products have
harmed them, we may be subject to costly and damaging product liability
litigation, which could have a material adverse effect on our business,
financial condition and results of operations.
We
may
face exposure to product liability and other claims due to allegations that
our
products cause harm. These risks are inherent in the clinical trials for
pharmaceutical products and in the testing, and future manufacturing and
marketing of, our products. Although we currently maintain product liability
insurance, such insurance is becoming increasingly expensive, and we may not
be
able to obtain adequate insurance coverage in the future at a reasonable cost,
if at all. If we are unable to obtain product liability insurance in the future
at an acceptable cost or to otherwise protect against potential product
liability claims, we could be inhibited in the commercialization of our
products, which could have a material adverse effect on our business. The
coverage will be maintained and limits reviewed from time to time as we progress
to later stages of our clinical trials, and as the length of the trials and
the
number of patients enrolled in the trials changes.
We
intend
to obtain a combined coverage policy that includes tail coverage in order to
cover any claims that are made for any events that have occurred prior to the
merger. We currently have a policy covering $10 million of product liability
for
our clinical trials, for which our annual premium is approximately $164,000.
However, insurance coverage and our resources may not be sufficient to satisfy
any liability resulting from product liability claims. A successful product
liability claim or series of claims brought against us could have a material
adverse effect on our business, financial condition and results of operations.
Risks
Related to Owning Our Common Stock
The
holders of the Series B Preferred Stock are entitled to rights
and preferences that are significantly greater than the rights and preferences
of the holders of our common stock, including preferential payments upon a
liquidation, as well as a dividend and registration rights associated with
their
shares.
Holders
of our Series B Preferred Stock are entitled to a number of rights and
preferences which holders of shares of our outstanding common stock do not
and
will not have. Among these rights and preferences is a preference on liquidation
of the Company, which means that holders of the Series B Preferred Stock will
be
entitled to receive the proceeds out of any sale or liquidation of the Company
before any such proceeds are paid to holders of our common stock. In general,
if
the proceeds received upon any sale or liquidation do not exceed the total
liquidation proceeds payable to the holders of the Series B Preferred Stock,
holders of common stock would received no value for their shares upon such
a
sale or liquidation. In addition, shares of the Series B Preferred Stock accrue
dividends at a rate of 8% per year for a period of five years from the date
on
which the shares of Series B Preferred Stock were issued.
Holders
of the Series B Preferred Stock also have significant rights with respect to
certain actions that we may wish to take from time to time. At any time when
any
shares of Series B Preferred Stock remain outstanding, we may not, without
the
consent of the holders of a majority of the shares held by holders of at least
$4,000,000 (measured as of the original issue date) worth of Series B Preferred
Stock:
|
•
|
incur
debt in excess of $2,000,000;
|
|
•
|
authorize
the sale of securities at a price per share less than the price per
share
that the Series B Preferred Stock has been sold under the Series
B
Purchase Agreement;
|
|
•
|
increase
the authorized capital of the Company;
|
|
•
|
create
any new classes or series of stock with rights senior to the common
stock;
|
|
•
|
issue
any shares of our Series A Preferred Stock, other than in accordance
with
our shareholder rights plan;
|
|
•
|
amend
any provision of our Certificate of Incorporation or Bylaws that
changes
the rights of the Series B Preferred Stock;
|
|
•
|
pay
or declare any dividend on any capital stock of the Company other
than the
Series B Preferred Stock;
|
|
•
|
purchase
or redeem any securities;
|
|
•
|
issue
any securities to employees other than pursuant to our 2005 Stock
Plan, or
increase the number of shares of common stock reserved for issuance
under
the 2005 Stock Plan;
|
|
•
|
liquidate,
dissolve or wind-up;
|
|
•
|
merge
with another entity;
|
|
•
|
sell
or dispose of any assets of the Company, including the sale or
license of its intellectual property;
|
|
•
|
change
the number of directors;
|
|
•
|
amend
any portion of our Certificate of Incorporation or Bylaws;
|
|
•
|
materially
change the nature of our business;
|
|
•
|
intentionally
take any action that may result in our stock no longer being approved
for
quotation on the American Stock Exchange or NASDAQ, or that would
cause
our common stock to no longer be registered pursuant to Section 12
of the
Securities Exchange Act of 1934, as amended; or
|
|
•
|
amend
any material agreement that has been filed with the
SEC.
|
As
a
result, we will not be able to take any of these actions without first seeking
and obtaining the approval of the holders of the Series B Preferred Stock.
We
may not be able to obtain such approval in a timely manner or at all, even
if we
think that taking the action for which we seek approval is in the best interests
of the Company.
In
connection with the closing of the financing, we entered into an Amendment
No. 1
to the Registration Rights Agreement (“Amendment”) with institutional investors
(the “Buyers”). The Amendment amends the Registration Rights Agreement dated
July 25, 2007, by extending the schedule under which we are required to file
registration statements with the SEC for the resale of the shares of common
stock issuable upon conversion of the shares of Series B Preferred Stock issued
to the Buyers, as well as upon conversion of the shares of Series B Preferred
Stock underlying the warrants issued to the Buyers. The Amendment also grants
the Buyers additional piggy-back registration rights in the event of an
underwritten public offering of our securities and demand registration rights
at
the option of a majority of the Buyers. The Amendment also relieves us of our
obligation to pay the Buyers liquidated damages in certain circumstances, as
described in the Amendment.
The
holders of the Series B Preferred Stock represent a significant voting interest
in the Company.
The
Series B Preferred Stock is convertible into common stock at any time at the
option of the holder at an initial conversion rate of 1:1, subject to adjustment
pursuant to the terms of the Series B Preferred Stock. Assuming the full
conversion of all of the shares of Series B Preferred Stock into our common
stock, and the exercise all of warrants to acquire shares of Series B Preferred
Stock which are then converted into shares of our common stock, the holders
of
the Series B Preferred Stock would represent approximately 83% of our issued
and
outstanding capital stock as of December 31, 2007. Accordingly, in the event
that all of the shares of Series B Preferred Stock were to be converted into
our
common stock, a change in control of the Company would occur. Prior to such
conversion, each holder of Series B Preferred Stock is entitled to cast the
number of votes equal to one-half of the number of whole shares of common stock
into which the shares of Series B Preferred Stock held by such holder are
convertible. Therefore, on the date of issuance of the Series B Preferred Stock,
the holders of Series B Preferred Stock held approximately 41% of the voting
power of the Company.
Our
stock price is volatile and you may not be able to resell your shares at a
profit.
We
first
publicly issued common stock on November 8, 1991 at $15.00 per share in our
initial public offering and it has been subject to fluctuations since that
time.
For example, during 2007, the closing sale price of our common stock has ranged
from a high of $7.50 per share to a low of $1.75 per share. The market price
of
our common stock could continue to fluctuate substantially due to a variety
of
factors, including:
|
·
|
quarterly
fluctuations in results of operations;
|
|
·
|
material
weaknesses in our internal control over financial
reporting;
|
|
·
|
the
announcement of new products or services by us or competitors;
|
|
·
|
sales
of common stock by existing stockholders or the perception that these
sales may occur;
|
|
·
|
adverse
judgments or settlements obligating us to pay damages;
|
|
·
|
developments
concerning proprietary rights, including patents and litigation matters;
and
|
|
·
|
clinical
trial or regulatory developments in both the United States and foreign
countries.
|
In
addition, overall stock market volatility has often significantly affected
the
market prices of securities for reasons unrelated to a company’s operating
performance. In the past, securities class action litigation has been commenced
against companies that have experienced periods of volatility in the price
of
their stock. Securities litigation initiated against us could cause us to incur
substantial costs and could lead to the diversion of management’s attention and
resources, which could have a material adverse effect on revenue and earnings.
We
have a large number of authorized but unissued shares of common stock, which
our
Board of Directors may issue without further stockholder approval, thereby
causing dilution of your holdings of our common stock.
As
of
December 31, 2007, there were 297,413,623 shares of authorized but unissued
shares of our common stock. Our management will continue to have broad
discretion to issue shares of our common stock in a range of transactions,
including capital-raising transactions, mergers, acquisitions, for anti-takeover
purposes, and in other transactions, without obtaining stockholder approval,
unless stockholder approval is required for a particular transaction under
the
rules of the American Stock Exchange, Delaware law, or other applicable laws.
If
our management determines to issue shares of our common stock from the large
pool of such authorized but unissued shares for any purpose in the future
without obtaining stockholder approval, your ownership position would be diluted
without your further ability to vote on that transaction.
The
sale of a substantial number of shares of our common stock could cause the
market price of our common stock to decline and may impair our ability to raise
capital through additional offerings.
We
currently have outstanding warrants and options to purchase an aggregate of
4,407,422 shares of our common stock. Sales of these shares in the public
market, or the perception that future sales of such shares could occur, could
have the effect of lowering the market price of our common stock below current
levels and make it more difficult for us and our stockholders to sell our equity
securities in the future.
Our
executive officers, directors and holders of more than 5% of our common stock
collectively beneficially own approximately 30% of the outstanding common stock,
which includes fully vested options to purchase common stock. In addition,
approximately 876,706 shares of common stock issuable upon exercise of vested
stock options could become available for immediate resale if such options were
exercised.
Sale
or
the availability for sale, of shares of common stock by stockholders could
cause
the market price of our common stock to decline and could impair our ability
to
raise capital through an offering of additional equity securities.
Anti-takeover
provisions may frustrate attempts to replace our current management and
discourage investors from buying our common stock.
We
have
entered into a Stockholders’ Rights Agreement pursuant to which each holder of a
share of our common stock is granted a Right to purchase our Series A Preferred
Stock under certain circumstances if a person or group acquires, or commences
a
tender offer for, 20% of our outstanding common stock. In addition,
the Board of Directors has the authority, without further action by the
stockholders, to fix the rights and preferences of, and issue shares of,
Preferred Stock. These provisions and other provisions of our charter and
Delaware corporate law may discourage certain types of transactions involving
an
actual or potential change in control.
FORWARD-LOOKING
STATEMENTS AND CAUTIONARY STATEMENTS
Statements
in this prospectus and the documents incorporated by reference herein that
are
not statements or descriptions of historical facts are “forward-looking”
statements under Section 27A of the Securities Act, Section 21E of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the
Private Securities Litigation Reform Act of 1995, and are subject to numerous
risks and uncertainties. These forward-looking statements and other
forward-looking statements made by us or our representatives are based on a
number of assumptions. The words “believe”, “expect”, “anticipate”, “intend”,
“estimate”, “plan”, “predict”, “could”, “will”, “should”, “seek”, “potential”,
“continue” or other expressions, which are predictions of or indicate future
events and trends and which do not relate to historical matters, identify
forward-looking statements. The forward-looking statements represent our
judgments and expectations as of the date of this prospectus. We assume no
obligation to update any such forward-looking statements. Readers are cautioned
not to place undue reliance on these forward-looking statements, as they involve
risks and uncertainties, and actual results could differ materially from those
currently anticipated due to a number of factors, including those set forth
in
this section and elsewhere in this prospectus. These factors include, but are
not limited to, the risks set forth in this prospectus.
The
forward-looking statements set forth in this document represent our judgment
and
expectations as of the date of this prospectus. We assume no obligation to
update any such forward-looking statements.
Discussions
containing these forward-looking statements are also contained in “Management’s
Discussion and Analysis of Financial Condition and Results of Operations”
incorporated by reference from our most recent Annual Report on Form 10-K,
our Quarterly Reports on Form 10-Q for the quarters ended since our most
recent Annual Report, our Current Reports on Form 8-K, as well as any
amendments we make to those filings with the SEC.
USE
OF PROCEEDS
The
proceeds from the sale or other disposition of the common stock covered by
this
prospectus are solely for the accounts of the selling stockholders named in
this
prospectus. We will not receive any proceeds from the sale or other disposition
of these shares of common stock.
The
selling stockholders will pay any underwriting discounts and commissions and
expenses incurred by the selling stockholders for brokerage, accounting, tax
or
legal services or any other expenses incurred by the selling stockholders in
disposing of the shares. We will bear all other costs, fees and expenses
incurred in effecting the registration of the shares covered by this prospectus,
including, without limitation, all registration and filing fees, Nasdaq listing
fees and fees and expenses of our counsel and our independent registered public
accounting firm.
SELLING
STOCKHOLDERS
On
July
25, 2007, we issued approximately $25 million worth of our Series B
Preferred Stock and warrants to purchase our Series B Preferred Stock in a
private placement exempt from the registration requirements of the Securities
Act (the "Financing"), which shares are comprised of the following securities:
(i) 10,000,000 shares of common stock issuable upon conversion of the Series
B
Preferred Stock, and (ii) 2,500,000 shares of common stock issuable upon
conversion of the Series B Preferred Stock underlying the Warrants, at an
exercise price of $2.50 per share.
This
prospectus relates to the resale from time to time of up to a total of 613,297
shares of our common stock issuable upon conversion of a portion of the shares
of Series B Preferred Stock issued in the Financing, as well as 30,621 shares
of
our common stock issuable upon exercise of warrants to purchase our common
stock issued to the placement agent immediately following the closing of
the Financing. On
September 7, 2007, we filed a separate Registration Statement on Form S-3,
which
was declared effective on November 13, 2007, relating to the resale of 598,391
shares of our common stock issuable upon conversion of shares of Series B
Preferred Stock and 29,877 shares of our common stock issuable upon exercise
of
warrants issued to the placement agent. The registration statement of which
this
prospectus forms a part registers additional shares of common stock underlying
shares of Series B Preferred Stock issued pursuant to the
Financing.
The
following is a summary of the rights and preferences of the Series B Preferred
Stock and warrants that were issued in the Financing:
Dividends.
Holders
of Series B Preferred Stock will be entitled to receive cumulative dividends
at
an annual rate of 8% of the Series B Preferred Stock original issue price for
a
period of 5 years from the date of issuance. Such dividends, shall, at the
option of the holders of a majority of the Series B Preferred Stock outstanding,
be paid in cash or in shares of Series B Preferred Stock. We will not declare
any dividends on our junior preferred or common stock until after we have paid
all accrued but unpaid dividends on our Series B Preferred Stock.
Voting.
Holders
of Series B Preferred Stock are entitled to cast the number of votes equal
to
one-half of the number of shares of common stock into which their Series B
Preferred Stock would be convertible on the applicable record date. The Series
B
Preferred Stock votes on a 1-for-1 basis following its conversion into common
stock.
Liquidation
Preference.
Upon
liquidation, including deemed liquidations pursuant to a merger, consolidation
or a sale of all or substantially all of our assets, holders of Series B
Preferred Stock are entitled to a payment per share equal to the price at which
shares of Series B Preferred Stock were sold in the Financing, plus accrued
but
unpaid dividends, prior to payment of any amounts on our junior preferred or
common stock. The holders of the Series B Preferred Stock are entitled to
receive the proceeds out of any sale or liquidation of our company before any
such proceeds are paid to holders of our common stock. In general, if the
proceeds received upon any sale or liquidation do not exceed the total
liquidation proceeds payable to the holders of the Series B Preferred Stock,
which, prior to any adjustment in accordance with the terms of the Series B
Preferred Stock is equal to the aggregate cash proceeds received by us in the
Financing, holders of common stock would receive no value for their shares
upon
such a sale or liquidation.
Protective
Provisions.
At any
time when any shares of Series B Preferred Stock remain outstanding, we may
not,
without the consent of the holders of a majority of the shares held by holders
of at least $4,000,000 (measured as of the original issue date) worth of Series
B Preferred Stock: (i) incur debt in excess of $2,000,000,
(ii) authorize securities at a price per share less than the price per
share that the Series B Preferred Stock was sold, (iii) increase our
authorized capital, (iv) create any new classes or series of stock with
rights senior to the common stock, (v) issue any shares of our Series A
preferred stock, other than in accordance with our shareholder rights plan,
(vi) amend any provision of our amended and restated certificate of
incorporation or bylaws that changes the rights of the Series B Preferred Stock,
(vii) pay or declare any dividend on any capital stock,
(viii) purchase or redeem any securities, (ix) issue any securities to
employees other than pursuant to our 2005 Stock Plan, or increase the number
of
shares of common stock reserved for issuance under the 2005 Stock Plan,
(x) liquidate, dissolve or wind-up, (xi) merge with another entity or
(xii) sell or dispose of any of our assets, including the sale or
license of our intellectual property, (xiii) change the number of
directors, (xiv) amend any portion of our amended and restated certificate
of incorporation or bylaws, (xv) materially change the nature of our
business, (xvi) intentionally take any action that may result in our common
stock no longer being approved for quotation on the American Stock Exchange
or
NASDAQ, or that would cause our common stock to no longer be registered pursuant
to Section 12 of the Exchange Act, or (xvii) amend any material agreement
that has been filed with the SEC.
Conversion.
Holders
of Series B Preferred Stock have an option to convert their Series B Preferred
Stock at any time, plus, prior to the fifth anniversary of the original issuance
of Series B Preferred Stock, all accrued and unpaid dividends, into common
stock
at the initial conversion price equal to the price at which shares of Series
B
Preferred Stock were sold in the Financing, as adjusted in accordance with
the
provisions of our amended and restated certificate of incorporation. An
equivalent of $7,500,000 (measured as of the original issue date) of Series
B
Preferred Stock will automatically be converted into common stock when
(i) the thirty-day prior trailing average closing price of our common
stock, as reported by the American Stock Exchange, for the entire six months
preceding such time is equal to at least the price at which shares of Series
B
Preferred Stock were sold in the Financing and (ii) the registration
statement for resale of securities issued in the Financing has been declared
effective by the SEC and is continuously effective for a one and one-half year
period. Thereafter, the remainder of the outstanding Series B Preferred Stock
will automatically be converted into common stock when (i) the 30-day prior
trailing average closing price of our common stock, as reported by the American
Stock Exchange for the entire six months preceding such time is equal to at
least two times the price at which shares of Series B Preferred Stock were
sold
in the Financing and (ii) the registration statement for resale of
securities issued in the Financing has been declared effective by the SEC and
continuously effective for a one and one-half year period.
Anti-Dilution
Protection.
The
rights and preferences of the Series B Preferred Stock include weighted-average
anti-dilution protection. Each share of Series B Preferred Stock is initially
convertible into shares of our common stock by multiplying the number of shares
of Series B Preferred Stock to be converted, by a ratio, the numerator of which
is the purchase price, or the price per share at which the Series B Preferred
Stock was initially sold, and the denominator of which is the conversion price.
Initially, the purchase price and the conversion price are the same, which
makes
the initial conversion rate of the Series B Preferred Stock 1:1. In the event
we
issue securities at a price per share less than the initial price per share
of
the Series B Preferred Stock (other than certain excluded issuances such as
options pursuant to our approved stock option plans), the conversion price
would
decrease based upon a formula in the our amended and restated certificate of
incorporation, and the ratio against which the number of shares of Series B
Preferred Stock to be converted is multiplied would become greater than 1:1,
thus increasing the number of shares of common stock into which shares of the
Series B Preferred Stock will convert.
The
warrants that were issued in the Financing are immediately exercisable for
shares of our Series B Preferred Stock, for a period of five years, at an
exercise price of $2.50 per share. In addition, the warrants may be exercised
by
means of a cashless exercise. The exercise price of the warrants is adjustable,
from time to time, in the event of stock splits, rights offerings, fundamental
transactions or dilutive issuances.
We
also issued warrants to purchase 600,000 shares of our common stock to the
placement agent in the private placement, which warrants are immediately
exercisable at an exercise price of $2.50 per share.
Pursuant
to the terms of the Financing, we filed a Registration Statement on Form S-3,
of
which this prospectus constitutes a part, in order to permit the selling
stockholders to resell to the public 613,297 shares of our common stock issuable
upon conversion of the Series B Preferred Stock, and 30,621 shares of our common
stock issuable upon exercise of warrants to purchase our common
stock issued to a placement agent immediately following the
Financing. Pursuant to the terms of the Financing, we are required to file
additional registration statements covering all of the shares of common stock
issuable upon conversion of the Series B Preferred Stock issued in the Financing
and issuable upon conversion of the warrants, as well as the common stock
underlying the warrants issued to the placement agent. As noted above,
on
September 7, 2007, we filed a separate Registration Statement on Form S-3,
which
was declared effective on November 13, 2007, relating to the resale of 598,391
shares of our common stock issuable upon conversion of shares of Series B
Preferred Stock and 29,877 shares of our common stock issuable upon exercise
of
warrants issued to the placement agent. The
selling stockholders have each represented to us that they have obtained the
shares for their own account for investment only and not with a view to, or
resale in connection with, a distribution of the shares, except through sales
registered under the Securities Act or exemptions thereto.
We
are
registering the above-referenced shares to permit each of the selling
stockholders and their pledgees, donees, transferees or other
successors-in-interest that receive their shares after the date of this
prospectus to resell or otherwise dispose of the shares in the manner
contemplated under the “Plan of Distribution.” The selling stockholders may sell
some, all or none of their shares. We do not know how long the selling
stockholders will hold the shares before selling them. We currently have no
agreements, arrangements or understandings with the selling stockholders
regarding the sale of any of the shares. The shares offered by this prospectus
may be offered from time to time by the selling stockholders.
The
following table, to our knowledge, sets forth information regarding the
beneficial ownership of our common stock by the selling stockholders as of
May
7, 2008 and the number of shares being offered hereby by each selling
stockholder. For purposes of the following description, the term “selling
stockholder” includes pledgees, donees, permitted transferees or other permitted
successors-in-interest selling shares received after the date of this prospectus
from the selling stockholders. The information is based in part on information
provided by or on behalf of the selling stockholders. Beneficial ownership
is
determined in accordance with the rules of the SEC, and includes voting or
investment power with respect to shares, as well as any shares as to which
the
selling stockholder has the right to acquire beneficial ownership within sixty
(60) days after May 7, 2008 through the exercise or conversion of any stock
options, warrants, convertible debt or otherwise. All shares that are issuable
to a selling stockholder upon exercise of the warrants are included in the
number of shares being offered in the table below. Unless otherwise indicated
below, each selling stockholder has sole voting and investment power with
respect to its shares of common stock. The inclusion of any shares in this
table
does not constitute an admission of beneficial ownership by the selling
stockholder. We will not receive any of the proceeds from the sale of our common
stock by the selling stockholders.
|
|
SHARES
|
|
|
|
SHARES
|
|
|
|
BENEFICALLY
|
|
|
|
BENEFICALLY
|
|
|
|
OWNED BEFORE
|
|
SHARES
|
|
OWNED AFTER
|
|
|
|
OFFERING(1)
|
|
BEING
|
|
OFFERING(2)
|
|
SELLING
STOCKHOLDER
|
|
NUMBER
|
|
PERCENT
|
|
OFFERED
|
|
NUMBER
|
|
PERCENT
|
|
Baker/Tisch
Investments, L.P. (3)
|
|
|
70,971
|
|
|
2.67
|
%
|
|
3,482
|
|
|
67,489
|
|
|
2.54
|
%
|
Baker
Biotech Fund I, L.P.(4)
|
|
|
2,740,840
|
|
|
51.45
|
%
|
|
134,476
|
|
|
2,606,364
|
|
|
50.19
|
%
|
Baker
Brothers Life Sciences, L.P. (5)
|
|
|
7,438,590
|
|
|
74.20
|
%
|
|
364,965
|
|
|
7,073,625
|
|
|
73.23
|
%
|
14159,
L.P. (6)
|
|
|
240,276
|
|
|
8.5
|
%
|
|
11,789
|
|
|
228,487
|
|
|
8.12
|
%
|
Baker
Brothers Investments II, L.P.(7)
|
|
|
9,323
|
|
|
*
|
%
|
|
457
|
|
|
8,866
|
|
|
*
|
%
|
Atticus
Global Advisors, Ltd. (8)
|
|
|
1,750,000
|
|
|
40.36
|
%
|
|
85,862
|
|
|
1,664,138
|
|
|
39.15
|
%
|
Green
Way Managed Account Series, Ltd.(9)
|
|
|
250,000
|
|
|
8.81
|
%
|
|
12,266
|
|
|
237,734
|
|
|
8.42
|
%
|
Rodman
& Renshaw, LLC (10)
|
|
|
624,106
|
|
|
*
|
%
|
|
30,621
|
|
|
593,485
|
|
|
*
|
%
|
*Less
than 1%
(1)
|
Percentages
prior to the offering are based on 2,586,326 shares
of common stock that were issued and outstanding as of May 7, 2008.
We
deem shares of common stock that may be acquired by an individual
or group
within 60 days of May 7, 2008 pursuant to the exercise of options or
warrants or the conversion of convertible securities to be outstanding
for
the purpose of computing the percentage ownership of such individual
or
group, but such shares are not deemed to be outstanding for the purpose
of
computing the percentage ownership of any other individual or entity
shown
in the table.
|
|
|
(2)
|
We
do not know when or in what amounts the selling stockholders may
offer for
sale the shares of common stock pursuant to this offering. The selling
stockholders may choose not to sell any of the shares offered by
this
prospectus. Because the selling stockholders may offer all or some
of the
shares of common stock pursuant to this offering, and because there
are
currently no agreements, arrangements or undertakings with respect
to the
sale of any of the shares of common stock, we cannot estimate the
number
of shares of common stock that the selling stockholders will hold
after
completion of the offering. For purposes of this table, we have assumed
that the selling stockholders will have sold all of the shares covered
by
this prospectus upon the completion of the offering.
|
|
|
(3)
|
The
number of shares beneficially owned before the offering includes
56,777
shares of common stock issuable upon conversion of Series B Preferred
Stock and 14,194 shares of common stock issuable upon conversion
of Series
B Preferred Stock issuable upon exercise of the warrants that are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 3,482 shares of common stock
issuable
upon conversion of Series B Preferred Stock. Felix Baker and Julian
Baker,
as managing members, have the power to vote or dispose of the securities
owned by Baker Biotech Fund I, L.P.
|
|
|
(4)
|
The
number of shares beneficially owned before the offering includes
2,192,672
shares of common stock issuable upon conversion of Series B Preferred
Stock and 548,168 shares of common stock issuable upon conversion
of
Series B Preferred Stock issuable upon exercise of the warrants that
are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 134,476 shares of common stock
issuable upon conversion of Series B Preferred Stock. Felix Baker
and
Julian Baker, as managing members, have the power to vote or dispose
of
the securities owned by Baker/Tisch Investments, L.P.
|
|
|
(5)
|
The
number of shares beneficially owned before the offering includes
5,950,872
shares of common stock issuable upon conversion of Series B Preferred
Stock and 1,487,718 shares of common stock issuable upon conversion
of
Series B Preferred Stock issuable upon exercise of the warrants that
are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 364,965 shares of common stock
issuable upon conversion of Series B Preferred Stock. Felix Baker
and
Julian Baker, as managing members, have the power to vote or dispose
of
the securities owned by Baker Brothers Life Sciences,
L.P.
|
(6)
|
The
number of shares beneficially owned before the offering includes
192,221
shares of common stock issuable upon conversion of Series B Preferred
Stock and 48,055 shares of common stock issuable upon conversion
of Series
B Preferred Stock issuable upon exercise of the warrants that are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 11,789 shares of common stock
issuable
upon conversion of Series B Preferred Stock. Felix Baker and Julian
Baker,
as managing members, have the power to vote or dispose of the securities
owned by 14159, L.P.
|
|
|
(7)
|
The
number of shares beneficially owned before the offering includes
7,458
shares of common stock issuable upon conversion of Series B Preferred
Stock and 1,865 shares of common stock issuable upon conversion of
Series
B Preferred Stock issuable upon exercise of the warrants that are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 457 shares of common stock issuable
upon conversion of Series B Preferred Stock. Felix Baker and Julian
Baker,
as managing members, have the power to vote or dispose of the securities
owned by Baker Brothers Investments II, L.P.
|
|
|
(8)
|
The
number of shares beneficially owned before the offering includes
1,400,000
shares of common stock issuable upon conversion of Series B Preferred
Stock and 350,000 shares of common stock issuable upon conversion
of
Series B Preferred Stock issuable upon exercise of the warrants that
are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 85,862 shares of common stock
issuable
upon conversion of Series B Preferred Stock. Timothy R. Barakett
may be
deemed to have control over the voting or disposition of the securities
owned by Atticus Global Advisors, Ltd.
|
|
|
(9)
|
The
number of shares beneficially owned before the offering includes
200,000
shares of common stock issuable upon conversion of Series B Preferred
Stock and 50,000 shares of common stock issuable upon conversion
of Series
B Preferred Stock issuable upon exercise of the warrants that are
exercisable beginning as of the date of issuance of the Warrants
for a
period of five years at an exercise price of $2.50 per share. The
number
of shares being offered consists of 12,266 shares of common stock
issuable
upon conversion of Series B Preferred Stock. Timothy R. Barakett
may be
deemed to have control over the voting or disposition of the securities
owned by Green Way Managed Account Series, Ltd., in respect of its
segregated account Green Way Portfolio D.
|
|
|
(10)
|
The
number of shares beneficially owned before the offering includes
600,000
shares of common stock issuable upon exercise of warrants. The number
of
shares being offered consists of 30,622 shares of common stock issuable
upon exercise of warrants to purchase our common stock that are
exercisable beginning as of the date of issuance of the warrants
for a
period of five years at an exercise price of $2.50 per
share.
|
PLAN
OF DISTRIBUTION
Each
Selling Stockholder (the “Selling Stockholders”) of the common stock and any of
their pledgees, assignees and successors-in-interest may, from time to time,
sell any or all of their shares of common stock on the American Stock Exchange
or any other stock exchange, market or trading facility on which the shares
are
traded or in private transactions. These sales may be at fixed or negotiated
prices. A Selling Stockholder may use any one or more of the following methods
when selling shares:
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
·
|
block
trades in which the broker-dealer will attempt to sell the shares
as agent
but may position and resell a portion of the block as principal to
facilitate the transaction;
|
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
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·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
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·
|
privately
negotiated transactions;
|
|
·
|
settlement
of short sales entered into after the effective date of the registration
statement of which this prospectus is a part;
|
|
·
|
broker-dealers
may agree with the Selling Stockholders to sell a specified number
of such
shares at a stipulated price per share;
|
|
·
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
|
|
·
|
a
combination of any such methods of sale; or
|
|
·
|
any
other method permitted pursuant to applicable
law.
|
The
Selling Stockholders may also sell shares under Rule 144 under the Securities
Act if available, rather than under this prospectus.
Broker-dealers
engaged by the Selling Stockholders may arrange for other brokers-dealers to
participate in sales. Broker-dealers may receive commissions or discounts from
the Selling Stockholders (or, if any broker-dealer acts as agent for the
purchaser of shares, from the purchaser) in amounts to be negotiated, but,
except as set forth in a supplement to this Prospectus, in the case of an agency
transaction not in excess of a customary brokerage commission in compliance
with
NASDR Rule 2440; and in the case of a principal transaction a markup or markdown
in compliance with NASDR IM-2440.
In
connection with the sale of the common stock or interests therein, the Selling
Stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the Common
Stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such
transaction).
The
Selling Stockholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be “underwriters” within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In
no
event shall any broker-dealer receive fees, commissions and markups which,
in
the aggregate, would exceed eight percent (8%).
The
Company is required to pay certain fees and expenses incurred by the Company
incident to the registration of the shares. The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because
Selling Stockholders may be deemed to be “underwriters” within the meaning of
the Securities Act, they will be subject to the prospectus delivery requirements
of the Securities Act including Rule 172 thereunder. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 under
the
Securities Act may be sold under Rule 144 rather than under this prospectus.
Each Selling Stockholder has advised us that they have not entered into any
written or oral agreements, understandings, or arrangements with any underwriter
or broker-dealer regarding the sale of the resale shares. There is no
underwriter or coordinating broker acting in connection with the proposed sale
of the resale shares by the Selling Stockholders.
We
agreed
to keep this prospectus effective until the earlier of (i) the date on which
the
shares may be resold by the Selling Stockholders without registration and
without regard to any volume limitations by reason of Rule 144 under the
Securities Act or any other rule of similar effect or (ii) all of the shares
have been sold pursuant to this prospectus or Rule 144 under the Securities
Act
or any other rule of similar effect. The resale shares will be sold only through
registered or licensed brokers or dealers if required under applicable state
securities laws. In addition, in certain states, the resale shares may not
be
sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is
available and is complied with.
Under
applicable rules and regulations under the Exchange Act, any person engaged
in
the distribution of the resale shares may not simultaneously engage in market
making activities with respect to the common stock for the applicable restricted
period, as defined in Regulation M, prior to the commencement of the
distribution. In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases
and
sales of shares of the common stock by the Selling Stockholders or any other
person. We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale.
LEGAL
MATTERS
The
validity of the common stock offered in this prospectus will be passed upon
for
us by Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Boston,
Massachusetts.
EXPERTS
The
consolidated financial statements of Synvista as of December 31, 2007 and 2006,
and for the years ended, have been incorporated by reference herein in reliance
upon the report of J.H. Cohn LLP, independent registered public accounting
firm,
given upon the authority of that firm as experts in accounting and
auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We
are a
public company and file annual, quarterly and special reports, proxy statements
and other information with the SEC. You may read and copy any document we file
at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C.
20549. You can request copies of these documents by writing to the SEC and
paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for
more information about the operation of the Public Reference Room. Our SEC
filings are also available to the public at the SEC’s web site at http://www.sec.gov,
or at
our web site at www.synvista.com.
In
addition, our common stock is listed for trading on the American Stock Exchange
under the symbol “SYI.”
This
prospectus is only part of a Registration Statement on Form S-3 that we have
filed with the SEC under the Securities Act and therefore omits certain
information contained in the Registration Statement. We have also filed exhibits
and schedules with the Registration Statement that are excluded from this
prospectus, and you should refer to the applicable exhibit or schedule for
a
complete description of any statement referring to any contract or other
document. You may:
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·
|
inspect
a copy of the Registration Statement, including the exhibits and
schedules, without charge at the Public Reference Room,
|
|
|
|
|
·
|
obtain
a copy from the SEC upon payment of the fees prescribed by the SEC,
or
|
|
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|
|
·
|
obtain
a copy from the SEC’s web site.
|
The
SEC
allows us to “incorporate by reference” information from other documents that we
file with them, which means that we can disclose important information in this
prospectus by referring to those documents. The information incorporated by
reference is considered to be part of this prospectus, and information that
we
file later with the SEC will automatically update and supersede the information
in this prospectus. We incorporate by reference the documents listed below
and
any future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d)
of
the Exchange Act. The documents we are incorporating by reference as of their
respective dates of filing are:
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·
|
Our
Annual Report on Form 10-K for the year ended December 31, 2007,
filed on
March 31, 2008 (File No. 001-16043);
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|
|
|
|
· |
Our
Annual Report on Form 10-K/A for the year ended December 31, 2007,
filed
on April 29, 2008 (File No. 001-16043); |
|
|
|
|
· |
Our
Current Report on Form 8-K, filed on January 23, 2008 (File No.
001-16043); |
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|
· |
Our Current
Report on
Form 8-K, filed on March 26, 2008 (File No. 001-16043); |
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·
|
The
description of our common stock, $0.01 par value per share, which
is
contained in our Registration Statement on Form 8-A, filed on November
1,
1991, including any amendments or reports filed for the purpose of
updating such description; and
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|
|
|
|
·
|
The
description of the Rights under the Registrant’s Stockholders’ Rights
Agreement (which are currently transferred with the Registrant’s common
stock) contained in the Registrant’s Registration Statement on Form 8-A
(File No. 000-19529), filed under the Exchange Act, filed on August
4,
1995, including any amendment or report filed for the purposes of
updating
such description.
|
You
may
request, orally or in writing, a copy of these filings, which will be provided
to you at no cost, by contacting Investor Relations c/o Nancy Regan, at our
principal executive offices, which are located at 221 West Grand Avenue, Suite
200, Montvale, New Jersey 07645, (201) 934-5000.
To
the
extent that any statements contained in a document incorporated by reference
are
modified or superseded by any statements contained in this prospectus, such
statements shall not be deemed incorporated in this prospectus except as so
modified or superseded.
All
documents subsequently filed by us pursuant to Section 13(a), 13(c), 14 or
15(d)
of the Exchange Act after the date of this prospectus and prior to the
termination of this offering are incorporated by reference and become a part
of
this prospectus from the date such documents are filed. We also specifically
incorporate by reference any documents filed by us with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of the
initial registration statement and prior to the effectiveness of the
registration statement. Any statement contained in this prospectus or in a
document incorporated by reference is modified or superseded for purposes of
this prospectus to the extent that a statement contained in any subsequent
filed
document modifies or supersedes such statement.
Synvista
Therapeutics, Inc.
643,918
shares of common stock
Prospectus
____________,
2008
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution
The
following table sets forth the Company’s estimates (other than the SEC
registration fee) of the expenses in connection with the issuance and
distribution of the shares of common stock being registered. None of the
following expenses are being paid by the selling stockholders.
SEC
registration fee
|
|
$ |
25.31 |
|
Accounting
fees and expenses
|
|
$
|
5,000
|
|
Legal
fees and expenses
|
|
$
|
25,000
|
|
TOTAL
|
|
$ |
30,025.31 |
|
Item
15. Indemnification of Directors and Officers
Subsection
(a) of Section 145 of the General Corporation Law of the State of Delaware
(“DGCL”) empowers a corporation to indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the corporation) by reason of the
fact that the person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys’
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by the person in connection with such action, suit or proceeding if
the
person acted in good faith and in a manner the person reasonably believed to
be
in or not opposed to the best interests of the corporation, and, with respect
to
any criminal action or proceeding, had no reasonable cause to believe the
person’s conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo contendere
or
its equivalent, shall not, of itself, create a resumption believed to be in
or
not opposed to the best interests of the corporation, and, with respect to
any
criminal action or proceeding, had reasonable cause to believe that the person’s
conduct was unlawful.
Subsection
(b) of Section 145 empowers a corporation to indemnify any person who was or
is
a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that the person is or was a
director, officer, employee, or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee or agent
of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys’ fees) actually and reasonably incurred by
the person in connection with the defense or settlement of such action or suit
if the person acted in good faith and in a manner the person reasonably believed
to be in or not opposed to the best interests of the corporation and except
that
no indemnification shall be made in respect of any claim, issue or matter as
to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all of the circumstances of the
case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem
proper.
Section
145 further provides that to the extent a director or officer of a corporation
has been successful on the merits or otherwise in the defense of any action,
suit or proceeding referred to in subsections (a) and (b) or in defense of
any
claim, issue or matter therein, the person shall be indemnified against expenses
(including attorneys’ fees) actually and reasonably incurred by such person in
connection therewith; that the indemnification provided by Section 145 shall
not
be deemed exclusive of any other rights to which the indemnified party may
be
entitled; and that the scope of indemnification extends to directors, officers,
employees, or agents of a constituent corporation absorbed in a consolidation
or
merger and persons serving in that capacity at the request of the constituent
corporation for another. Section 145 also empowers the corporation to purchase
and maintain insurance on behalf of a director or officer of the corporation
against any liability asserted against such person or incurred by such person
in
any such capacity or arising out of such person’s status as such whether or not
the corporation would have the power to indemnify such person against such
liabilities under Section 145.
Article
IX of the registrant’s amended and restated by-laws specifies that the
registrant shall indemnify its directors and officers to the full extent
permitted by the DGCL. This provision of the amended and restated by-laws is
deemed to be a contract between the registrant and each director and officer
who
serves in such capacity at any time while such provision and the relevant
provisions of the DGCL are in effect, and any repeal or modification thereof
shall not offset any rights or obligations then existing with respect to any
state of facts then or theretofore existing or in any action, suit or proceeding
theretofore or thereafter brought or threatened in whole or in part upon any
such state of facts.
Section
102(b)(7) of the DGCL enables a corporation in its certificate of incorporation
to limit the personal liability of members of its board of directors for
violation of a director’s fiduciary duty of care. This Section does not,
however, limit the liability of a director for breaching his duty of loyalty,
failing to act in good faith, engaging in intentional misconduct or knowingly
violating a law, or from any transaction in which the director derived an
improper personal benefit. This Section also will have no effect on claims
arising under the federal securities laws. The registrant’s restated certificate
of incorporation limits the liability of its directors as authorized by Section
102(b)(7).
The
registrant currently carries liability insurance for the benefit of its
directors and officers which provides coverage for losses of directors and
officers for liabilities arising out of claims against such persons acting
as
directors or officers of the registrant (or any subsidiary thereof) due to
any
breach of duty, neglect, error, misstatement, misleading statement, omission
or
act done by such directors and officers, except as prohibited by law. The
liability limit, however, shall be reduced by amounts incurred for legal
defense, which amounts are to be applied against the retention amount. The
insurance policy also provides for the advancement of reasonable fees, costs
and
expenses, including attorneys’ fees under certain circumstances, incurred by
directors and officers in investigating, adjusting, defending and appealing
any
claim, subject to repayment by such director or officer if it is ultimately
determined that such insureds are not entitled under the terms of the policy
to
payment of such loss.
The
insurance policy will not provide coverage to the directors and officers to
the
extent that the registrant has indemnified the directors or officers. The policy
provides for the reimbursement of the registrant to the extent the registrant
has indemnified the directors and officers pursuant to law, contract or the
restated certificate of incorporation or amended and restated by-laws of the
registrant. Moreover, the policy does not provide coverage for any claim: (i)
based upon, or arising from, personal injury, slander, defamation or a similar
matter, (ii) based upon, or arising from the director or officer gaining, in
fact, a personal profit or advantage to which he or she was not legally
entitled, (iii) based upon, or arising from, any deliberately dishonest,
malicious or fraudulent act or omission or any willful violation of law by
any
insured if a judgment or other final adjudication adverse to the insured
established such an act, omission or willful violation, (iv) brought or
maintained by or on behalf of the insured organization or any insured person,
in
any capacity, subject to certain exceptions, including those related to
stockholders’ derivative actions, set forth in the policy, (v) based upon, or
arising from, environmental claims and violations, (vi) based upon, or arising
from, a violation of the Employee Retirement Income Security Act of 1974, as
amended, and (vii) arising from a loss insured by any other valid or collectible
insurance, except as such loss may exceed the policy amount or other limitations
of such other insurance.
At
present, there is no pending litigation or proceeding involving a director
or
officer of the registrant as to which indemnification is being sought nor is
the
registrant aware of any threatened litigation that may result in claims for
indemnification by any director or officer.
Item
16. Exhibits
The
exhibits required to be filed are listed on the “Exhibit Index” attached hereto,
which is incorporated herein by reference.
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 SEC 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; and
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|
|
|
(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) above do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in reports filed with or furnished to the
SEC
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 the 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.
|
|
|
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(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)
|
That,
for the purpose of determining liability under the Securities Act
of 1933
to any purchaser:
|
|
(i)
|
Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall
be deemed to be part of the registration statement as of the date
the
filed prospectus was deemed part of and included in the registration
statement: and
|
|
|
|
|
(ii)
|
Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5),
or (b)(7) as part of a registration statement in reliance on
Rule 430B relating to an offering made pursuant to
Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing
the information required by section 10(a) of the Securities Act of
1933 shall be deemed to be part of and included in the registration
statement as of the earlier of the date such form of prospectus is
first
used after effectiveness or the date of the first contract of sale
of
securities in the offering described in the prospectus. As provided
in
Rule 430B, for liability purposes of the issuer and any person that
is at that date an underwriter, such date shall be deemed to be a
new
effective date of the registration statement relating to the securities
in
the registration statement to which that prospectus relates, and
the
offering of such securities at that time shall be deemed to be the
initial
bona fide offering thereof. 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 effective date, 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 effective date.
|
|
|
|
(b)
|
The
undersigned registrant hereby undertakes 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.
|
|
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(c)
|
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 Securities 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
Securities Act and will be governed by the final adjudication of
such
issue.
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(d)
The
undersigned registrant hereby undertakes:
(1) For
purposes of determining any liability under the Securities Act of 1933, the
information omitted from the form of prospectus or any prospectus supplement
filed as part of this registration statement in reliance on Rule 430A and
contained in a form of prospectus or prospectus supplement filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under
the Securities Act shall be deemed to be part of this registration statement
as
of the time it was declared effective.
(2) For
the purpose of determining any liability under the Securities Act of 1933,
each
post-effective amendment that contains a form of prospectus or prospectus
supplement 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.
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
Montvale, State of New Jersey, on May 13, 2008.
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SYNVISTA
THERAPEUTICS, INC.
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By:
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/s/
Noah Berkowitz
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Noah
Berkowitz, M.D., Ph.D.
President
and Chief Executive Officer
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POWER
OF ATTORNEY
The
registrant and each person whose signature appears below constitutes and
appoints Noah Berkowitz and Wendy A. Milici, and each of them singly, his,
her
or its true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him, her or it and in his, her or its
name,
place and stead, in any and all capacities, to sign and file any and all
amendments (including post-effective amendments) to this registration statement,
with all exhibits thereto, and other documents in connection therewith, with
the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully to all intents and purposes as he, she, or it might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
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
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Title
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Date
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/s/
Noah Berkowitz
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President,
Chief Executive Officer and Director
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May
13, 2008
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Noah
Berkowitz, M.D., Ph.D.
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/s/
Wendy A. Milici
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(principal
financial officer)
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May
13, 2008
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Wendy
A. Milici
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/s/
Alex D’Amico
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(principal
accounting officer)
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May
13, 2008
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Alex
D’Amico, CPA
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/s/
Wayne P. Yetter
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Director
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May
13, 2008
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Wayne
P. Yetter
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/s/
Mary C. Tanner
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Director
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May
13, 2008
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Mary
C. Tanner
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/s/
John F. Bedard
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Director
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May
13, 2008
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John
F. Bedard
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EXHIBIT
INDEX
EXHIBIT
NUMBER
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DESCRIPTION
OF DOCUMENT
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2.1
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Agreement
and Plan of Merger by and among Alteon Inc., Alteon Merger Sub, Inc.,
HaptoGuard, Inc. and Genentech, Inc., dated as of April 19, 2006.
(Incorporated by reference to Annex A to the Company’s Schedule 14A filed
on June 22, 2006, SEC File Number 000-16043.)
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4.1
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Stockholders'
Rights Agreement between Alteon Inc. and Registrar and Transfer Company,
as Rights Agent, dated as of July 27, 1995. (Incorporated by reference
to
Exhibit 4.1 to the Company's Annual Report on Form 10-K for the year
ended
December 31, 2000, SEC File Number 001-16043.)
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4.2
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Amendment
to Stockholders' Rights Agreement between Alteon Inc. and Registrar
and
Transfer Company, as Rights Agent, dated as of April 24, 1997.
(Incorporated by reference to Exhibit 4.4 to the Company's Current
Report
on Form 8-K filed on May 9, 1997, SEC File Number
000-19529.)
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4.3
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Registration
Rights Agreement between Alteon Inc. and the investors named on the
signature page thereof, dated as of April 24, 1997. (Incorporated
by
reference to Exhibit 4.1 to the Company's Current Report on Form
8-K filed
on May 9, 1997, SEC File Number 000-19529.)
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4.4
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Form
of Common Stock Purchase Warrant. (Incorporated by reference to Exhibit
4.2 to the Company's Current Report on Form 8-K filed on May 9, 1997,
SEC
File Number 000-19529.)
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4.5
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Amendment
to Stockholders' Rights Agreement between Alteon Inc. and Registrar
and
Transfer Company, as Rights Agent, dated as of December 1, 1997.
(Incorporated by reference to Exhibit 4.1 to the Company's Current
Report
on Form 8-K filed on December 10, 1997, SEC File Number 000-
19529.)
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4.6
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Registration
Rights Agreement, dated September 29, 2000. (Incorporated by reference
to
Exhibit 4.1 to the Company's Current Report on Form 8-K filed on
October
5, 2000, SEC File Number 001- 16043.)
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4.7
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Form
of Series 1 Common Stock Purchase Warrant. (Incorporated by reference
to
Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on October
5, 2000, SEC File Number 001-16043.)
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4.8
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Form
of Series 2 Common Stock Purchase Warrant. (Incorporated by reference
to
Exhibit 4.3 to the Company’s Current Report on Form 8-K filed on October
5, 2000, SEC File Number 001-16043.)
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4.9
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Notice
of Appointment of The American Stock Transfer & Trust Company as
successor Rights Agent, dated August 29, 2002, pursuant to Stockholders’
Rights Agreement, dated as of July 27, 1995. (Incorporated by reference
to
Exhibit 4.4 of the Company’s Report on Form 10-Q filed on November13,
2002, SEC File Number 001-16043.)
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4.10
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Form
of Common Stock Purchase Warrant, dated July 2, 2004. (Incorporated
by
reference to Exhibit 4.10 to the Company’s Annual Report on Form 10-K for
the year ended December 31, 2005, SEC File Number
000-16043.)
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4.11
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Form
of Common Stock Purchase Warrant, dated January 5, 2005. (Incorporated
by
reference to Exhibit 4.11 to the Company’s Annual Report on Form 10-K for
the year ended December 31, 2005, SEC File Number
000-16043.)
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4.12
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Amended
and Restated Stockholder Rights Agreement between Alteon Inc. and
American
Stock Transfer & Trust Company, as Rights Agent, dated as of July 27,
2005. (Incorporated by reference to Exhibit 4.1 to the Company’s
Registration Statement on Form 8-A/A filed on July 27, 2005, SEC
File
Number 001-16043.)
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4.13
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Registration
Rights Agreement by and between Alteon Inc. and the Purchasers named
therein, dated as of April 19, 2006. (Incorporated by reference to
Exhibit
10.2 to the Company’s Registration Statement on Form S-3 filed on May 31,
2006, SEC File No. 333-134584.)
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4.14
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Form
of Common Stock Purchase Warrant issued to Investors pursuant to
the
Securities Purchase Agreement, dated as of April 19, 2006, by and
between
Alteon Inc. and the Purchasers named therein. (Incorporated by reference
to Exhibit 10.27 to the Company’s Registration Statement on Form S-3 filed
on May 31, 2006, SEC File No. 333-134584.)
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4.15
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Registration
Rights Agreement by and between Alteon Inc. and the Purchasers named
therein, dated as of September 13, 2006. (Incorporated by reference
to
Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on
September 19, 2006, SEC File No. 001-16043.)
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4.16
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Form
of Common Stock Purchase Warrant issued to Investors pursuant to
the
Securities Purchase Agreement, dated as of September 13, 2006, by
and
between the Company and the Purchasers named therein. (Incorporated
by
reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
filed on September 19, 2006, SEC File No. 001-16043.)
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4.17
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Registration
Rights Agreement among Alteon Inc. and the Purchasers named therein,
dated
as of January 11, 2007. (Incorporated by reference to Exhibit 10.4
to the
Company’s Current Report on Form 8-K filed on January 16, 2007, SEC File
No. 001-16043.)
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4.18
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Form
of Senior Convertible Secured Promissory Note issued to Lenders pursuant
to the Note and Warrant Purchase Agreement, dated as of January 11,
2007.
(Incorporated by reference to Exhibit 10.5 to the Company’s Current Report
on Form 8-K filed on January 16, 2007, SEC File No.
001-16043.)
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4.19
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Form
of Common Stock Purchase Warrant issued to Lenders pursuant to the
Note
and Warrant Purchase Agreement, dated as of January 11, 2007.
(Incorporated by reference to Exhibit 10.6 to the Company’s Current Report
on Form 8-K filed on January 16, 2007, SEC File No.
001-16043.)
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4.20
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Amendment
No. 1 Stockholder Rights Agreement by and between Synvista Therapeutics,
Inc. and American Stock Transfer & Trust Company, dated as of January
11, 2007. (Incorporated by reference to Exhibit 10.7 to the Company’s
Current Report on Form 8-K filed on January 16, 2007, SEC File No.
001-16043.)
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4.21
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Form
of Registration Rights Agreement among Synvista Therapeutics, Inc.
and
each Purchaser identified on the signature pages thereto. (Incorporated
by
reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
filed on April 11, 2007, SEC File No. 001-16043.)
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4.22
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Series
B Preferred Stock and Warrant Purchase Agreement, as amended, among
Alteon
Inc. and the Purchasers named therein, dated as of April 5, 2007
(Incorporated by reference to Annex A to the Company’s Definitive Proxy
Statement filed on June 22, 2007), SEC File No.
001-16043.)
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4.23
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Form
of Preferred Stock Purchase Warrant issued to Purchasers pursuant
to the
Series B Preferred Stock and Warrant Purchase Agreement, dated April
5,
2007. (Incorporated by reference to Exhibit 10.4 of Registrant’s Current
Report on Form 8-K filed on April 11, 2007, SEC File No.
001-16043.)
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4.24
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Amendment
No. 1 to Registration Rights Agreement dated May 14, 2007 by and
among the
Company and the Purchasers identified on the signature pages to that
certain Registration Rights Agreement dated as of January 11, 2007.
(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report
on Form 8-K filed on May 18, 2007, SEC File Number
001-16043.)
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4.25
|
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Amendment
No. 1 to Registration Rights Agreement dated September 7, 2007 by
and
among the Company and the Purchasers identified on the signature
pages to
that certain Registration Rights Agreement dated as of July 25, 2007.
(Incorporated by reference to Exhibit 10.1 to the Company’s Current Report
on Form 8-K filed on September 13, 2007, SEC File Number
001-16043.)
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4.26
|
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Registration
Rights Agreement by and between Synvista Therapeutics, Inc and the
Purchasers named therein dated as of July 25, 2007. (Incorporated
by
reference to Exhibit 10.3 of Registrant’s Current Report on Form 8-K,
filed on April 11, 2007, SEC File No. 001-16043.)
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5.1*
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Opinion
of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
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23.1*
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Consent
of J.H. Cohn LLP.
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23.2
|
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Consent
of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. (Included
in
opinion of counsel filed as Exhibit 5.1).
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24.1
|
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Power
of Attorney. (See
“Power of Attorney” on signature page).
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* Filed
herewith