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As filed with the Securities and Exchange Commission on October 5, 1998
Registration No. 333-61435
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
RIBI IMMUNOCHEM RESEARCH, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 81-0394349
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification Number)
553 OLD CORVALLIS ROAD
HAMILTON, MT 59840
(406) 363-6214
(Address, including zip code and telephone number, including
area code, of registrant's principal executive offices)
RONALD H. KULLICK, SECRETARY Copy To: WILLIAM D. SHERMAN, ESQ.
RIBI IMMUNOCHEM RESEARCH, INC. MORRISON & FORESTER
553 OLD CORVALLIS ROAD 755 PAGE MILL ROAD
HAMILTON, MT 59840 PALO ALTO, CA 94304
(406) 363-6214 (415) 813-5600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Approximate date of commencement of proposed sale to the public: At such
time or times as Selling Security Holder desires to sell 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, check the following box. [
]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462 (b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a posteffective amendment filed pursuant to Rule 462 (c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
Title of each Proposed Proposed
class of Amount maximum maximum Amount of
securities to to be offering aggregate registration
be registered registered price offering price
fee
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 5,493,333(1) (2) (2) $5,819.43
Par value $.001
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<FN>
(1) Issuable upon conversion of 8,240 shares of Series A Convertible Preferred
Stock (the "Preferred Stock"). For the purpose of estimating the number of
shares of Common Stock to be included in the Registration Statement of
which this Prospectus is a part, the Company calculated 200% of the number
of shares issuable upon conversion using a conversion price of $3.00 per
share. In addition to the estimated number of shares set forth in the
table, the amount to be registered includes a presently indeterminate
number of shares issuable upon conversion of or otherwise in respect of the
Preferred Stock as a result of stock splits, stock dividend and
antidilution provisions in accordance with Rule 416.
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) based on the average of the high and low
reported sales price on the NASDAQ National Market on August 12, 1998 of
$4.00 with respect to 2,728,477 shares, and on October 2, 1998 of $3.1875
with respect to 2,764,856 shares. $3,219.60 was paid with the initial
filing on August 13, 1998.
</FN>
</TABLE>
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8 (A)
MAY DETERMINE.
<PAGE>
Subject to Completion
PRELIMINARY PROSPECTUS DATED OCTOBER 5, 1998
Ribi ImmunoChem Research, Inc.
5,493,333 Shares of
Common Stock, $.001 par value
THIS PROSPECTUS covers the offer and sale from time to time by the holder
thereof (the "Selling Security Holder") of 5,493,333 shares of Common Stock par
value $.001 (the "Common Stock") of Ribi ImmunoChem Research, Inc. (the
"Company"), a portion or all of which may be issued to the Selling Security
Holder upon conversion of Series A Convertible Preferred Stock ("Preferred
Stock") of the Company issued to the Selling Security Holder pursuant to the
Securities Purchase Agreement dated July 17, 1998 (the "Agreement"). The shares
of Common Stock covered by this Prospects (the "Shares") were issued and sold in
connection with the Company's July 1998 private placement of Preferred Stock in
a transaction exempt from the registration requirements of the Securities Act of
1933, as amended (the "Securities Act"), pursuant to Section 4(2) of the
Securities Act, to a person who was reasonably believed by the Company to be an
institution that is an "accredited investor" (as such term is defined in Rule
501(a) under the Securities Act) and are thus "restricted securities" under the
Securities Act. This Prospectus has been prepared for the purpose of registering
the Shares under the Securities Act to allow for future sales by the Selling
Security Holders to the public without restriction. The actual number of shares
of Common Stock to be issued upon conversion of the Preferred Stock will depend
upon the total number of shares of Preferred Stock converted and the conversion
price.
The Selling Security Holder or its respective pledgees, donees, transferees
or their successors in interest may from time to time sell the shares of Common
Stock covered by this Prospectus ("Shares") in one or more transactions which
may involve block transactions on The Nasdaq Stock Market, in other market
transactions, in privately negotiated transactions through the writing of
options on the shares of Common Stock, in short sales or in combination thereof.
The sale price may be the market price prevailing at the time of sale, a price
related to such prevailing market price, at negotiated prices or such other
price as the Selling Security Holder determines from time to time. See "Plan of
Distribution."
The Company will receive no proceeds from the sale by the Selling Security
Holder. The Company realized gross proceeds from the sale of Preferred Stock of
$8,240,000, less estimated expenses associated therewith of approximately
$537,500.
The Common Stock of the Company is traded on The Nasdaq Stock Market under
the symbol "RIBI." On October 2, 1998 the closing price of the Common Stock as
reported by the National Association of Securities Dealers, Inc. was $3.1875 per
share.
In selling the Shares offered hereby, the Selling Security Holder may be
deemed to be an "underwriter" under the Securities Act of 1933, as amended, and
the excess of the price received over the amount paid for such shares may be
deemed underwriting compensation under the Securities Act. Sales may be made by
such persons to or through brokers or dealers who may similarly be deemed to be
<PAGE>
underwriters. Any commission or profit realized on resales by brokers or dealers
may also be deemed to be underwriting compensation under the Securities Act. See
"Plan of Distribution."
THE SHARES OF COMMON STOCK OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" COMMENCING ON PAGE 2.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
No person has been authorized to give any information or to make any
representations, other than those contained in this Prospectus, and if given or
made, such information or representations must not be relied upon as having been
authorized by the Company or the Selling Security Holder. This Prospectus does
not constitute an offer to sell or solicitation of an offer to buy, nor shall
there be any sale of these securities by anyone in any state in which such
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities law of such state, or in which the person
making such offer or solicitation is not qualified to do so, or to any person to
whom it is unlawful to make such offer or solicitation.
The date of this Prospectus is October 5, 1998.
<PAGE>
This Prospectus and the documents incorporated herein contain forward-
looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities and Exchange Act of 1934, which
statements involve risks and uncertainties. The Company's actual results could
differ materially from those anticipated in these forward-looking statements as
a result of certain factors, including those set forth under "Risk Factors"
below.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith files reports, proxy and information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy and information statements and other information filed by the Company can
be inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549,
and at the following Regional Offices of the Commission: New York Regional
Office, 7 World Trade Center, 13th Floor, New York, New York 10048; and Chicago
Regional office, Northwestern Atrium Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such material may also be inspected at
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006. Copies of such material may be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Judiciary Plaza,
Washington, D.C. 20549, at prescribed rates. The public may obtain information
on the operation of the Public Reference Room by calling the Commission at 1-
800-SEC-0330. The Commission maintains a Web Site at http://www.sec.gov that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission.
The Company has filed with the Commission a registration statement on Form
S-3 (the "Registration Statement") (of which this Prospectus is a part) under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Shares of Common Stock offered hereby. This Prospectus does not contain all
of the information set forth in the Registration Statement, certain portions of
which have been omitted as permitted by the rules and regulations of the
Commission. Statements contained in this Prospectus as to the contents of any
contract or other documents are not necessarily complete, and in each instance
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement, each such statement being qualified in
all respects by such reference and the exhibits and schedules thereto. For
further information regarding the Company and the shares of Common Stock offered
hereby, reference is hereby made to the Registration Statement and such exhibits
and schedules which may be obtained from the Commission at its principal office
in Washington, D.C. upon payment of the fees prescribed by the Commission.
THE COMPANY'S BUSINESS
The Company is developing products that stimulate the immune system to
generate a cascade of natural agents and signals to treat and prevent human
disease. These immunostimulants can be combined with disease-specific antigens
to direct the immune system to respond to a particular cancer or infectious
disease or can be used to produce a generalized immune response to prevent
conditions such as postischemic reperfusion injury. The Company is engaged in
the research, development, production and marketing of these products, some of
which are under investigation by other companies for use as adjuvants. In
addition, the
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Company engages in related activities such as the custom formulation and sale of
research products.
The Company's facilities are located near Hamilton, Montana, on a 35 acre
complex owned by the Company. The Company's buildings contain approximately
60,000 square feet of laboratory, commercial scale manufacturing, marketing and
administrative facilities. The manufacturing facility has been built to FDA
standards for Good Manufacturing Practices. One hundred four full-time and four
part-time employees are employed by the Company. The Company also uses outside
consultants and collaborators to support and complement the activities of its
scientific staff on a specific project basis.
RISK FACTORS
The securities being offered hereby involve a high degree of risk.
Prospective investors should review the entire Prospectus and the materials
incorporated by reference herein and carefully consider, among other factors,
the following matters:
Limited Commercial Products
The Company's principal activities since its formation in 1981 have been
the research, development production and marketing of biopharmaceutical products
designed to stimulate an immune response in humans and animals in order to
prevent or treat malignant, infectious and other diseases. While there is
evidence that the biological response modifiers produced by the Company and
others may provide treatment for certain cancers, infectious and other diseases,
the workings of the immune system, particularly in conjunction with biological
response modifiers, are not yet fully understood. As a result the Company's
research and development activities, as well as those of its competitors, are
based on theories and concepts which may not have been completely proven or
defined. The Company has and continues to test on humans its products designed
for use by humans. To date there have been no significant untoward effects
associated with the administration of its products, and present data indicate
that certain products for certain applications have activity.
Based upon a completed, controlled Phase III human clinical trial, the
Company has filed applications to commercially market its MELACINE melanoma
theraccine in Canada and Europe and is preparing an application which it expects
to file in the United States toward the middle of next year. The Company is also
developing and collaborating with entities toward the development of products
for other applications. However, additional testing in human subjects is
required to demonstrate efficacy and confirm product safety. The Company markets
a line of laboratory research reagents.
The Company's Technology
The technology of the Company is based on the potent capacities or certain
microbial products to modulate the cytokine (regulatory substances produced by
cells) cascade in man and other animals. Slight modifications of these products
and/or their physical and biological delivery to the immune system profoundly
influence the qualitative and quantitative natures of the subsequent cytokine
modulation and the physiological responses. The Company believes that
appropriate delivery of products of this core technology can be used to suppress
an unwanted immunological or inflammatory response and/or to enhance a
protective response.
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Other than certain laboratory research products which presently generate
limited sales revenue, there is no assurance that the products under
development, including MPL immunostimulant, MELACINE melanoma theraccine, any
adjuvants for human use, any vaccines or any other immunological agents which
may be developed by the Company for use in the treatment or prevention of
infectious, malignant or other diseases will yield successful results. If
results are successful, there is no assurance that the Company will receive the
necessary governmental approvals for its products, that satisfactory joint
venture or licensing arrangements will be available to the Company or that any
of the Company's products will be accepted by the medical or veterinary
communities.
Accumulated Deficit; Increasing Net Losses; Sales;
Need for Additional Cash
The Company' s net losses have been increasing over the past several years,
and the Company expects to incur substantial operating losses for at least the
next year and probably longer as its clinical evaluation activities continue and
possibly expand. During the years ended December 31, 1993, 1994, 1995, 1996 and
1997 the Company incurred net losses of $3,684,000, $3,790,000, $5,317,000,
$5,589,000 and $6,417,000, respectively. As of June 30, 1998 the Company had an
accumulated deficit of approximately $45,771,000. To date the Company has
generated only limited sales revenue. Sales and operating revenues of the
Company for the years ended December 31, 1993, 1994, 1995, 1996 and 1997 were
$3,162,000, $4,554,000, $4,023,000, $4,623,000 and $6,530,000, respectively.
There can be no assurance that the Company's products will prove successful or
generate significant sales or earnings in the future.
The Company is not able to estimate with certainty the amount of cash and
working capital which may be needed for operations. Such requirements typically
vary depending upon the results of basic research and clinical trials, the time
and expense required for governmental approval of products, and competitive and
technical developments, most of which are beyond management's control. The
Company believes that its available cash, cash equivalents and short-term and
long-term investments and funds from license agreements and product sales should
be sufficient to meet its cash requirements through 2000. Continued operations
of the Company beyond such period will be dependent upon the Company's ability
to generate substantial operating revenue or procure additional financing. There
can be no assurance that the Company's products will prove successful or
generate significant sales or earnings in the future or that, if needed, the
Company will be able to obtain future funding on reasonable terms, if at all, or
at the appropriate time for its planned activities.
Patents and Proprietary Protection
The Company has obtained and applied for patents in the United States and
several foreign countries. The Company has 22 issued United States patents. The
expiration dates for issued United States patents held by the Company range from
2001 to 2016. There is no assurance that patents applied for by the Company will
be obtained, and there can be no assurance that the claims embodied in existing
patents to which the Company has rights will not be challenged. The issuance of
a patent to the Company or to a licensor of the Company is not conclusive as to
validity or as to the enforceable scope of claims therein. The validity and
enforceability of a patent can be challenged by a request for re-examination or
litigation after its issuance and, if the outcome of such litigation is adverse
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to the owner of the patent, other parties may be free to use the subject matter
covered by the patent.
There can be no assurance that additional patents will be obtained by the
Company in the United States or in other jurisdictions, or that any patents will
provide substantial protection, or be of commercial benefit to the Company. The
cost of enforcing the Company's patent rights in lawsuits, which the Company may
bring against infringers or which may be brought challenging the Company's
patents, may be substantial and could interfere with the Company's operations.
The patent laws of other countries may differ from those of the United States as
to the patentability of the Company's products and processes. Moreover, the
degree of protection afforded by foreign patents may be different from that in
the United States. On an ongoing basis the Company reviews its patent portfolio
and has abandoned and may in the future abandon patents or patent applications
for reasons including limited protection, lack of commercial importance and
limited enforceability, among other considerations. The Company also relies
substantially upon unpatented proprietary knowledge. There can be assurance that
others will not develop such knowledge independently or otherwise obtain access
to the Company's technology. In addition, it may be found that the technologies
used by the Company may infringe upon patents or proprietary technology of
others.
Governmental Regulation
Regulation by governmental authorities in the United States and other
countries is a significant factor in the development, production and marketing
of the Company's human biopharmaceutical and in its ongoing research and
development activities. In order to produce and market human biopharmaceuticals,
the Company must satisfy mandatory procedures and meet safety and efficacy
standards established by the United States Food and Drug Administration ("FDA")
and comparable agencies in foreign countries. The process of seeking and
obtaining approval for the manufacturing and marketing of a new human
biopharmaceutical product may require a number of years and substantial funding.
There can be no assurance that any required approvals will be granted on a
timely basis, if at all, or that such approvals, once granted, will not be
withdrawn. Furthermore, there is no assurance that additional regulation will
not be imposed on the Company's activities or products in the future.
Governmental Reforms
In the past few years health care reform has received considerable
attention. While it appears that federal governmental intervention is not
imminent at this time, certain reform measures currently being considered by
various state governments and certain related market restructuring could
adversely affect the pricing of therapeutic or prophylactic products or the
amount of reimbursement available. Such events could have an adverse impact on
the profitability of companies developing, manufacturing or marketing
pharmaceutical products. The Company cannot predict the extent of possible
future governmental reforms or the effect such reforms or other measures may
have on its business.
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Competition
The biotechnology and pharmaceutical industries are characterized by
rapidly evolving technology and intense competition. The Company's products
under development are expected to address a broad range of markets. The
Company's competition will be determined in part by the potential indications
for which the Company's products are developed and ultimately approved by
regulatory authorities. The first pharmaceutical product to reach the market in
a therapeutic or preventative area is often at a significant competitive
advantage relative to later entrants to the market. Accordingly, the relative
speed with which the Company or its corporate partners can develop products,
complete the clinical trials and approval processes and supply commercial
quantities of the products to the market are expected to be important
competitive factors. The Company's competitive position also will depend on,
among other things, its ability to attract and retain qualified scientific and
other personnel, develop effective proprietary products, develop and implement
production and marketing plans, obtain and maintain patent protection and secure
adequate capital resources. The Company expects its products, if approved for
sale, to compete primarily on the basis of product efficacy, safety, patient
convenience, reliability, value and patent position. In addition to potential
competition from other biopharmaceutical products, the products presently under
development by the Company may compete with nonbiological drugs and other
therapies. The Company's competitors include major pharmaceutical, chemical and
specialized biotechnology companies, many of which have financial, technical and
marketing resources significantly greater than those of the Company.
The Company is aware that research is being conducted by others in areas in
which the Company is seeking to establish commercial products. The Company's
competitors might offer products which by reason of price or efficacy may be
superior to any products that may be developed by the Company. There can be no
assurance that the discoveries of and products introduced by others will not
render the Company's products obsolete or that the Company will otherwise be
able to compete effectively with such competitors.
Attraction and Retention of Key Employees
The Company's business is highly technical, and there are a limited number
of scientists with expertise in the area of the Company's operations. The
success of the Company's business, therefore, is and will be dependent upon its
ability to attract and retain qualified research personnel. There is substantial
competition for such employees, and there can be no assurance with regard to the
Company's ability to recruit and maintain talented scientists.
Volatility of Stock Price
The market price of the Company's Common Stock, like that of the securities
of many other biotechnology and pharmaceutical companies, has fluctuated over a
wide range, and the market price of the shares of Common Stock offered hereby is
likely to be highly volatile in the future. Factors such as fluctuation in the
Company's operating results, announcements of technological innovations or new
commercial products by the Company or its competitors, governmental regulation,
developments or disputes concerning patent or other proprietary rights public
concern as to the safety of devices or drugs developed by the Company or its
competitors, and general market conditions may have a significant effect on the
market price of the Common Stock.
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Legal Proceedings
Potential Liability for Groundwater Contamination
The Company, the National Institutes of Health ("NIH") and the Bitterroot
Valley Sanitary Landfill ("Landfill") were notified by the Montana Department of
Health and Environmental Sciences (now known as the Department of Environmental
Quality ["DEQ"]) in March of 1991 that they had been identified as potentially
responsible parties ("PRPs") and as such are jointly and severally liable for
groundwater contamination located at and near the site of the Landfill in
Ravalli County, Montana. The Company's involvement arises out of waste materials
that it deposited at the Landfill from 1982 to 1985, which the Landfill had
permits to receive. The NIH unilaterally and voluntarily initiated and completed
work pursuant to an interim remediation plan approved by the DEQ to remove and
decontaminate the believed source of contamination and treat the aquifers which
tests have shown contain contaminants. Although decontamination of the soil at
and around the Landfill has been completed, treatment of the groundwater in the
proximity of the disposal site continues utilizing air sparging, and it is
anticipated such treatment will continue through 1998 and possibly longer.
Carbon filtering was discontinued in August 1997 based upon non-detectible
amounts of volatile organic compounds in post-air sparging samples. The DEQ
conducted a "Risk Assessment" and issued a "Draft Final Feasibility Study" in
October 1994 that discussed possible final remediation alternatives. In August
1995, the DEQ announced that it had approved a second interim action in the
vicinity of the Landfill being unilaterally and voluntarily conducted by the NIH
and which involves installing individual replacement wells and new wells to
provide both an alternate water supply for the area residents and to develop
additional information on the site hydrogeology. Information collected from
these wells through a multi-year monitoring program will be used by the DEQ to
evaluate the effectiveness of the remediation efforts to date. The current plan
calls for the wells to be installed in three phases: Phase I includes occupied
properties with the highest remaining contamination levels; Phase II includes
occupied properties with lesser degrees of contamination; and Phase III consists
largely of vacant properties. Preliminary studies completed in 1994 estimated
the cost of the wells to be approximately $1,400,000. Recent information
indicates that a total of nineteen alternate water supply wells have been
installed at a cost of approximately $1,000,000. The DEQ could require the PRPs
to implement further remediation should these wells not provide sufficient
quality or quantity of water. The NIH has indicated it is undertaking Phase II
groundwater remediation to intercept and treat contaminated groundwater near the
eastern Landfill boundary. The NIH has projected costs for this Phase II
groundwater remediation to be in excess of $1,000,000 through 1999. The NIH,
which has taken the lead and incurred substantially all of the remediation
costs, has represented publicly that it would continue to work with the DEQ
toward an acceptable final remediation plan. The DEQ initiated an action in 1997
against the Company, the Landfill and the owner of the Landfill seeking recovery
of past alleged costs associated with its oversight activities in the amount of
$238,000, as well as a declaratory judgment finding the parties liable for
future remedial costs, plus civil penalties in the event the parties fail to
comply. The Company believes that it has meritorious defenses to the claim,
including the amount thereof, and that there are other responsible parties. The
Company has filed a response to the action, including a motion to dismiss. There
can be no assurance that the Company's defenses and motion will be successful.
On April 21, 1998, the Company received notice that the U. S. Department of
Justice ("USDJ") , acting on behalf of the Department of Health and Human
Services, ("United States of America")
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which oversees the NIH, filed suit in United States District Court seeking
contribution from the Company of an "equitable share" of past and future
response costs incurred by the United States of America in connection with the
remediation at and near the Landfill. The complaint alleges that as of September
30, 1997, the United States of America had incurred response costs in excess of
$3,400,000 and that it expects to incur more than $1,000,000 in additional
response costs. The Company filed a response to the action. Although the Company
believes it has meritorious defenses to the claim, including the amount thereof,
and that there are other responsible parties, there can be no assurance that the
Company will be successful in its defenses to claims arising out of the
Landfill, including the claims made by the United States of America. On or about
June 6, 1998 the DEQ as a Plaintiff-Intervenor filed a complaint in the United
States District Court against the Company, the Landfill and the owner of the
Landfill seeking recovery of past alleged costs associated with its oversight
activities in the amount of $258,500, of which it indicated not more than
$154,000 had been reimbursed, plus interest and attorneys' fees and costs, as
well as a declaratory judgment finding the parties liable for future response
costs. The Company has filed a response to the action, including a counterclaim
against the Plaintiffs. The Company believes that it has meritorious defenses to
the claim, including the amount thereof, and that there are other responsible
parties. There can be no assurance that the Company's defenses and counterclaim
will be successful. On or about June 4, 1998 the Company received notice that
the Plaintiff United States of America had entered into a settlement agreement
with the Landfill and the Landfill owner pursuant to which the settling parties
agreed to make payment in the amount of $440,000. In view of the settlement the
Plaintiff United States of America filed with the Court a Joint motion for Stay
of Proceedings between the United States of America, the Landfill and the
Landfill owner. Depending upon the eventual outcome of the litigation and when
in time the litigation is concluded, outcome may or may not have a material
adverse effect on the Company's financial condition. The Company is unable to
determine its overall potential liability with respect to the Landfill at this
time. As of June 30, 1998, the Company has accrued a reserve of approximately
$230,000, primarily to cover billed and potential legal, consulting, remediation
and DEQ reimbursement costs associated with the Company as a PRP. Net costs
charged against operations during the first six month periods 1998 and 1997 were
$47,000 and $45,000, respectively.
Wrongful Discharge Action
In June 1997, a complaint was filed in District Court in Ravalli County
against the Company by a former employee who was discharged for cause in June
1996. The plaintiff alleges discharge in violation of the Montana Wrongful
Discharge from Employment Act ("Act") and further, that discharge was for
refusal to violate public policy. The Court granted dismissal with respect to
that portion of the complaint which alleges termination for refusal to violate
public policy. Plaintiff filed a motion for reconsideration asking the Court to
reverse its decision with respect to the issue of termination for refusal to
violate public policy and requested the Court for permission to amend the
complaint to include additional allegations relative to the public policy issue.
On April 6, 1998, the Court allowed plaintiff to amend the complaint as
requested. The Company believes that it has a meritorious defense and plans to
vigorously defend the suit. Because the action is in early stages, it is not
possible to reliably assess the outcome. Depending upon the eventual outcome of
this litigation and when in time the litigation is concluded, an adverse outcome
may or may not have a material adverse effect of the Company's financial
condition. The plaintiff has also filed a Petition for Judicial Review in
District Court in Missoula County
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naming the Company and the State of Montana Department of Labor and Industry
respondents and asking the Court to review and overturn the Department of
Labor's decision finding plaintiff was terminated for misconduct as defined in
MCA Section 39-51-2303 and, therefore, not allowing plaintiff to collect
unemployment benefits. The Company filed a response arguing the correctness of
the Department of Labor's decision. The Court issued and Opinion and Order
remanding the matter to the Department of Labor concluding that there were
insufficient findings of fact to justify its ruling on the matter. It is not
possible to determine the outcome of this action at this time. However, in the
event plaintiff is successful, it would not have a material adverse effect on
the financial condition of the Company.
Shares Eligible for Future Sale; Dilution
As of the close of business on June 30, 1998 options to purchase 1,664,373
shares of Common Stock were outstanding pursuant to the Company's employee
benefit plans and stock option agreements with management and directors at a
weighted average exercise price of $5.07 per share. There is also outstanding a
warrant to purchase an aggregate of 500,000 shares of Common Stock at an
exercise price of $5.00 per share. These warrants expire if not exercised by
January 1, 2000. In addition, there is outstanding an option to purchase up to
$2,000,000 worth of shares of the Company's Common Stock at market prices as of
the date of exercise of the option. The option expires if not exercised by
January 1, 1999. The Company has, pursuant to agreement with the holder of such
warrant and option, registered with the Commission the shares of Common Stock
issuable upon exercise of the warrant and option. As a result, substantially all
of the Company's outstanding Common Stock and Common Stock subject to issuance
upon exercise of the outstanding warrant and option will be freely tradeable in
the open market following this offering and registration, subject, in the case
of shares held by affiliates of the Company, to the provisions of Rule 144 under
the Securities Act of 1933 (the "Securities Act").
The Company may issue additional stock, warrants and/or options to raise
capital in the future. The Company may also issue additional stock or options
under its employee and director benefit plans.
During the term of the options and warrants described above, the holders
thereof are given the opportunity to profit from a rise in the market price of
the Company's Common Stock. The effect of the exercise of such options and
warrants may have on the market value of the Company's Common Stock is not
known. The existence of such options and warrants may adversely affect the terms
on which the Company can obtain additional equity financing.
As of October 5, 1998, 8,240 shares of the Preferred Stock were issued and
outstanding. Each share of Preferred Stock is convertible into such number of
shares of Common Stock as is determined by dividing the stated value ($1,000) of
the share of Preferred Stock (as such value is increased by a premium based on
the number of days the Preferred Stock is held) by the then current Conversion
Price (which is determined by reference to the then current market price).
Pursuant to the terms of the Preferred Stock, if the Preferred Stock had
actually been converted on October 5, 1998, the conversion price would have been
$6.04 at which price the Preferred Stock would have been convertible into
approximately 1,364,238 shares of Common Stock, but this number of shares could
prove to be significantly greater in the event of a decrease in the trading
price of the Common Stock. Purchasers of Common Stock could therefore experience
substantial
8
<PAGE>
dilution of their investment upon conversion of the Preferred Stock. The shares
of Preferred Stock are not registered and may be sold only if registered under
the Securities Act or sold in accordance with an applicable exemption from
registration, such as Rule 144. The shares of Common Stock into which the
Preferred Stock may be converted are being registered pursuant to this
Registration Statement.
Risk of Product Liability
The testing and marketing of health care products entails an inherent risk
of product liability claims. The Company currently maintains product liability
insurance coverage covering the clinical testing of its products, as well as the
commercial sale of MELACINE melanoma theraccine if approved. To date there have
been no product liability claims asserted against the Company. However, there
can be no assurance that product liability claims will not be asserted against
the Company or that the Company will be able to maintain existing coverage or
obtain reasonable insurance coverage should it choose to do so in the future.
Cash Dividends
The Company has never paid any cash dividends on its Common Stock and does
not intend to pay any cash dividends on its Common Stock in the foreseeable
future. There can be no assurance that the Company will ever declare or pay cash
dividends on its Common Stock.
Year 2000 Compliance
In computer systems and applications developed in the 1970s and 1980s,
years were often stored in a 2-digit rather than 4-digit format to save
expensive computer storage and processing space. These systems correctly assumed
the 2-digit year in data was preceded by the digits "19." At year 2000, a 2-
digit date of "00" may not be interpreted correctly by these systems, which
could lead to incorrect or inadequate results. The Company established a
committee, which made a preliminary assessment, and hired an outside firm which
is determining in reasonable detail the Company's exposure to the "Year 2000"
problem. The Company has begun prioritizing systems that will potentially
require remediation and testing. The Company is also developing contingency
plans to deal with possible Year 2000 noncompliance by vendors of key raw
materials. The Company expects to continue to incur both internal staffing
costs, as well as consulting and other expenses related to these issues. These
costs will be expensed as incurred Preliminary assessment indicates that
resulting solutions will involve a mix of purchasing new systems and modifying
existing systems. The Company is working to solve these issues in a timely
manner, but there can be no assurance that all of the Year 2000 problems will be
resolved before the end of 1999 or that all of the Company's vendors and
customers will be Year 20000 compliant. The Company is not yet able to estimate
the potential costs associated with the Year 2000 problem.
Certain Charter Provisions Affecting Potential Changes in Control
The Company's Restated Certificate of Incorporation includes a provision
(the "Fair Price Provision") which requires the approval of greater than a
majority of the Board of Directors as a condition to certain business
combinations (a "Business Combination") with, or proposed by, a holder of ten
percent (10%) or more of the Company's voting stock, an affiliate of the Company
who beneficially owned ten percent (10%) or more of the Company's voting stock
within
9
<PAGE>
the two-year period prior to the Business Combination, or certain assignees or
successors of such persons, except in cases where the Business Combination has
been approved by a vote of seventy-five percent (75%) of the shares of the
Company's voting stock, or by a majority of disinterested directors, or where
certain other minimum price criteria and other procedural requirements are
satisfied. The Fair Price Provision may discourage certain types of transactions
involving an actual or potential change in control of the Company, including
transactions in which the stockholders might otherwise receive a premium for
their shares over then current market prices and may limit the ability of
stockholders to approve transactions that they may deem to be in their best
interests. In addition the Board of Directors has the authority to fix the
rights and preferences of and issue shares of Preferred Stock, which may have
the effect of delaying or preventing a change in control of the Company without
action by the stockholders. See "Description of Capital Stock."
USE OF PROCEEDS
The Company will receive no proceeds from the sale by the Selling Security
Holder of shares of Common Stock pursuant to this Prospectus.
SELLING SECURITY HOLDER
The following table sets forth as of October 5, 1998 the name of and the
number of shares of Common Stock beneficially owned by the Selling Security
Holder, the number of shares being offered hereby and the number and percentage
of shares beneficially owned after the offering assuming the Selling Security
Holder offers and sells all 5,493,333 shares of Common Stock. Since the Selling
Security Holder may elect not to sell some or all of its shares of Common Stock,
no estimate can be made of the aggregate number of shares that are to be offered
hereby or that will be owned by the Selling Security Holder upon completion of
an offering to which this Prospectus relates.
<TABLE>
<CAPTION>
Beneficial Ownership Shares Being Beneficial Ownership
Name Prior to Offering Offered(1) After This Offering
- ---- ----------------- ------- -------------------
Number Percent(2) Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
RCG International Investors, LDC(3) 5,493,333 21.28 5,493,333 0 0
- -----------------------------------------------------------------------------------------------
<FN>
(1) The number of shares set forth in the table represents an estimate of the
number of shares of Common Stock to be offered by the Selling Security
Holder. The actual number of shares of Common Stock issuable upon
conversion of the Preferred Stock is indeterminate, is subject to
adjustment and could be materially less or more than such estimated number
depending on factors which cannot be predicted by the Company at this
time, including, among other factors, the future market price of the
Common Stock. The actual number of shares of Common Stock offered hereby,
and included in the Registration Statement of which this Prospectus is a
part, includes such additional number of shares of Common Stock as may be
issued or issuable upon conversion of the Preferred Stock by reason of any
stock split, stock dividend or similar transaction involving the Common
Stock, in order to prevent dilution, in accordance with Rule 416 under the
Securities Act. Pursuant to the terms of the Preferred Stock, if the
Preferred Stock had been actually converted on October 5, 1998, the
conversion price would have been $6.04 at which price the Preferred Stock
would have been converted into approximately 1,364,238 shares of Common
Stock. Pursuant to the terms of the Preferred Stock, the shares of
Preferred Stock are convertible by any holder only to the extent that the
number of shares of Common Stock thereby issuable, together with the
number of shares of Common Stock owned by such holder and its affiliates
(but not including shares of Common Stock underlying unconverted shares of
Preferred Stock) would not exceed 4.9% of the then outstanding Common
Stock as determined in accordance with Section 13(d) of the Exchange Act.
Accordingly, the number of shares of Common Stock set forth in the table
for the Selling Security Holder exceeds the number of shares of Common
Stock that this Selling Security
10
<PAGE>
Holder could own beneficially at any given time through their ownership of
the Preferred Stock. In that regard, beneficial ownership of this Selling
Security Holder set forth in the table is not determined in accordance
with Rule 13d-3 under the Exchange Act.
(2) Based upon 20,322,373 shares of Common Stock outstanding as of October 2,
1998, plus 5,493,333 shares of Common Stock issuable upon conversion of
the Preferred Stock.
(3) RGC International Investors, LDC is a party to an investment management
agreement with Rose Glen Capital Management, L.P., a limited partnership
of which the general partner is RGC General Partner Corp. Messrs. Wayne
Bloch, Gary Kaminsky and Steve Katznelson own all of the outstanding
capital stock of RGC General Partner Corp., are the sole officers and
directors of RGC General Partner Corp. and are parties to a shareholders'
agreement pursuant to which they collectively control RGC General Partner
Corp. Through RGC General Partner Corp., such individuals control Rose
Glen Capital Management, L.P. Such individuals disclaim beneficial
ownership of the Company's Common Stock owned by the Selling Shareholder.
</FN>
</TABLE>
PLAN OF DISTRIBUTION
Stock owned by the Selling Security Holder or their respective pledgees,
donees, transferees or other successors in interest (collectively, "Selling
Security Holder") and included in this Prospectus may be offered and sold by the
Selling Security Holder at any time while the Registration Statement, of which
this Prospectus is a part, is effective. The Selling Security Holder has
informed the Company that these shares may be offered for sale from time to time
by the Selling Security Holder or may be retained. The shares of Common Stock
(the "Shares") may be sold from time to time to purchasers directly by the
Selling Security Holder. The Shares being offered by the Selling Security Holder
will be sold from time to time in one or more transactions (which may involve
block transactions) on the Nasdaq National Market or on such other market on
which the Common Stock may from time to time be trading, in privately-negotiated
transactions, through the writing of options on the Shares, short sales or any
combination thereof. The sale price to the public may be the market price
prevailing at the time of sale, a price related to such prevailing market price,
at negotiated prices or such other price as the Selling Security Holder
determines from time to time. Pursuant to Rule 144 under the Securities Act of
1933, as amended (the "Securities Act"), Common Stock may be sold under Rule 144
rather than pursuant to a registration statement under the Securities Act. The
Selling Security Holder shall have the sole and absolute discretion not to
accept any purchase offer or make any sale of Shares if they deem the purchase
price to be unsatisfactory at any particular time.
The Selling Security Holder may also sell the Shares directly to market
makers acting as principals and/or broker-dealers acting as agents for
themselves or their customers. Such broker-dealers may receive compensation in
the form of discounts, concessions or commissions from the Selling Security
Holder and/or the purchasers of Shares for whom such broker-dealers may act as
agents or to whom they sell as principal or both (which compensation as to a
particular broker-dealer might be in excess of customary commission). Market
makers and block purchasers purchasing the Shares will do so for their own
account and at their own risk. It is possible that a Selling Security Holder
will attempt to sell shares of Common Stock in block transactions to market
makers or other purchasers at a price per share which may be below the then
market price. There can be no assurance that all or any of the Shares offered
hereby will be issued to, or sold by, the Selling Security Holder. The Selling
Security Holder and any brokers, dealers or agents, upon effecting the sale of
any of the Shares offered hereby may be deemed "underwriters" as that term is
defined under the Securities Act or the Exchange Act, or the rules and
regulations thereunder.
11
<PAGE>
The Selling Security Holder, alternatively, may sell all or any part of the
Shares offered hereby through an underwriter. No Selling Security Holder has
entered into any agreement with a prospective underwriter, and there is no
assurance that any such agreement will be entered into. If a Selling Security
Holder enters into such an agreement or agreements, the relevant details will be
set froth in a supplement or revisions to this Prospectus.
The Selling Security Holder and any other person participating in the sale
or distribution of the Shares will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including, without
limitation, Regulation M, which provisions may restrict certain activities of,
and limit the timing of purchases and sales of any of the Shares by the Selling
Security Holder or any other such person. Furthermore, under Regulation M,
persons engaged in a distribution of securities are prohibited from
simultaneously engaging in market making and certain other activities with
respect to such securities for a specified period of time prior to the
commencement of such distributions, subject to specified exceptions or
exemptions. The foregoing may affect the marketability of the Shares.
The Company has agreed to indemnify the Selling Security Holder or their
transferees or assignees, against certain liabilities, including liabilities
under the Securities Act, or to contribute to payments the Selling Security
Holder may be required to make in respect thereof.
At the time the Selling Security Holder makes a particular offer of Common
Stock, to the extent required, the Selling Security Holder will provide the
Company with information sufficient to prepare a Prospectus Supplement, if
necessary, which will set forth the aggregate amount of shares being offered and
the terms of the offering, including the name or names of any underwriters,
brokers or dealers, any discounts, commissions and other items constituting
compensation from the Selling Security Holder and any discounts, commissions or
concessions allowed or re-allowed or paid to dealers.
DESCRIPTION OF CAPITAL STOCK
As of the date of this Prospectus, the authorized capital stock of the
Company consists of 30,000,000 shares of Common Stock, par value $.001 per
share, and 10,000,000 shares of Preferred Stock, par value $.10 per share.
Common Stock
As of June 30, 1998 there were 20,320,573 shares of Common Stock
outstanding. Holders of the Common Stock are entitled to receive, pro rata, such
dividends as may from time to time be declared by the Board of Directors out of
assets legally available therefor, subject to the dividend rights of the
Preferred Stock and any contractual restrictions that may be agreed to by the
Company. The Company may also make other distributions on the Common Stock or
repurchase shares of the Common Stock to the extent permitted by law, subject to
similar limitations. The Company has never paid any cash dividends on the Common
Stock, and does not expect to pay any cash dividends on the Common Stock in the
foreseeable future. In the event of the liquidation or dissolution of the
Company, holders of the Common Stock are entitled to receive, pro rata, all
assets remaining after payment in full of creditors and after the preferential
rights, if any, of the holders of the Preferred Stock. Holders of the Common
Stock are entitled to one vote per share on each matter submitted to a vote of
12
<PAGE>
the stockholders, including the election of directors. Cumulative voting for
election of directors is not permitted. The holders of the Common Stock do not
have preemptive rights, and the Common Stock is not subject to any redemption or
sinking fund provisions.
Preferred Stock
As of the date of this Prospectus, 8,240 shares of Preferred Stock were
outstanding. The Company's Board of Directors is authorized to issue Preferred
Stock in one or more series. Within the limitations of Delaware law and the
Company's Restated Certificate of Incorporation, the Board of Directors may fix
the rights, preferences, limitations and terms of each series of Preferred
Stock, including, under current Delaware law, the designation and number of
shares in a series, dividend rights, liquidation rights, redemption provisions,
sinking fund provisions, conversion rights and voting rights (including the
number of voters per share and whether voting as a class or series is required).
The issuance of any series of Preferred Stock with voting rights or with the
right to convert to voting stock may affect the voting rights of the holders of
the Common Stock by an increase in outstanding voting stock or by creating stock
which votes as a class or series on the election of Directors or other matters.
Holders of the Preferred Stock are in any event entitled by law to vote as a
class on certain amendments to the Restated Certificate of Incorporation which
affect their stock. The issuance of any series of Preferred Stock may also
affect the payment of dividends to holders of Common Stock, consistent with
Preferred Stock dividend rights which may attach to the issuance of one or more
series of Preferred Stock.
Transfer Agent and Registrar
The transfer agent and registrar for the Company's Common Stock is
Continental Stock Transfer & Trust Company, New York, NY 10004.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The Company hereby incorporates by reference in this Prospectus the
Company's annual report on Form 10-K for the fiscal year ended December 31, 1997
and the Company's quarterly report on Form 10-Q for the quarters ended March 31
and June 30, 1998 filed pursuant to Section 13 of the Exchange Act.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15 (d) of the Exchange Act subsequent to the date of this Prospectus shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents.
Any statement contained in this Prospectus or a document incorporated or
deemed to be incorporated by reference in this Prospectus shall be deemed to be
modified or superseded for purposes of this Prospectus to the extent that a
statement contained in any subsequently filed document (including this
Prospectus or any other document that is or is deemed to be incorporated by
reference in this Prospectus) modifies or supersedes such previous statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request, a copy of any information
13
<PAGE>
that has been incorporated by reference in this Prospectus (excluding exhibits
unless the exhibits are specifically incorporated by reference). Requests for
such information should be directed to the Secretary of the Company at the
Company's principal executive offices, 553 Old Corvallis Road, Hamilton, MT
59840, telephone number (406) 363-6214.
EXPERTS
The financial statements of Ribi ImmunoChem Research, Inc. as of December
31, 1997 and 1996 and for each of the years in the three year period ended
December 31, 1997, have been incorporated by reference herein and in the
registration statement in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
14
<PAGE>
TABLE OF CONTENTS
Page
----
Available Information . . . . . . 1
The Company's Business. . . . . . 1
Risk Factors. . . . . . . . . . . 2
Use of Proceeds . . . . . . . . . 10
Selling Security Holder . . . . . 10
Plan of Distribution. . . . . . . 11
Description of Capital Stock. . . 12
Incorporation of Certain
Information by Reference . . . . 13
Experts . . . . . . . . . . . . . 14
---------------
Ribi ImmunoChem Research, Inc.
5,493,333 Shares
of
Common Stock
---------------
PROSPECTUS
---------------
October 5, 1998
15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following statement sets forth estimated expenses of the sale and
distribution of the securities being registered, other than underwriting fees
and expenses. All of the amounts shown are estimates except the SEC registration
fee and the NASDAQ listing fee:
SEC Registration Fee . . . . . . . . . . . . . . $ 5,819.43
NASDAQ Listing Fee . . . . . . . . . . . . . . . 17,500.00
Blue Sky Fees and Expenses . . . . . . . . . . . -
Accounting Fees and Expenses . . . . . . . . . . 2,000.00
Legal Fees and Expenses . . . . . . . . . . . . 5,000.00
---------
Miscellaneous Expenses . . . . . . . . . . . . . 2,000.00
---------
Total . . . . . . . . . . . . . . . . . . $32,319.43
=========
Item 15. Indemnification of Directors and Officers
The Company's Certificate of Incorporation provides that the Company shall
indemnify its directors and officers to the extent permitted by the Delaware
General Corporation Law, and the Company's Amended Bylaws provide that the
Company shall indemnify its directors and officers to the fullest extent
permitted by law. Section 145 of the Delaware General Corporation Law provides,
in part, that a corporation has the power to indemnify its current and former
directors and officers against liability resulting from and expenses actually
and reasonably incurred by them in connection with any actual or threatened
legal action in which they are made parties by reason of being or having been
directors or officers of the corporation if they acted in good faith and in a
manner reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceeding, if they had
no reasonable cause to believe their conduct was unlawful. However, as to any
legal actions brought by or in the right of a corporation to procure a judgment
in its favor, no indemnification shall be made in respect of any claim, issue or
matter as to which the director or officer has been adjusted to be liable for
negligence or misconduct in the performance of his duty to the corporation,
unless and only to the extent that the Court of Chancery or the court in which
such action was brought shall determine that such person is fairly and
reasonably entitled to indemnity for such expenses as the court shall deem
proper. These provisions may be sufficiently broad to indemnify the directors
and officers of the Company for liabilities arising under the Securities Act of
1933, as amended (the "Act").
Insofar as indemnification by the Company for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
person of the Company pursuant to the provisions described above, or otherwise,
the Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable.
16
<PAGE>
Item 16. Exhibits
4.1 Restated Certificate of Incorporation of the Company (incorporated by
reference to Exhibit 4.1 of the Company's Registration Statement on
Form S-3 filed with the Commission on June 22, 1992, Registration No.
33-48713)
4.2 Amended Bylaws of the Registrant (Incorporated by reference to Exhibit
3.2 to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1988, File No. 0-11094)
5.1 Opinion of Ronald H. Kullick, counsel for the Company
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Ronald H. Kullick, counsel for the Company (included in
Exhibit 5.1)
24.1 Powers of Attorney (included as part of the Registration Statement
signature page)
Item 17. Undertakings
(a) The Registrant hereby undertakes: (1) To file, during any period in
which offers or sales are being made, a posteffective amendment to this
Registration Statement: (i) To include any prospectus required by Section
10(a)(3) of the Securities Act if 1933; (ii) To reflect in the prospectus any
facts or events arising after the effective date of the Registration Statement
(or the most recent posteffective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in information set forth in the
Registration Statement. Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar value of securities offered
would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than 20 percent
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and (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. (2) That, for the purpose of
determining any liability under the Securities Act of 1933, each such
posteffective 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. (3)
To remove from registration by means of a posteffective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
(b) The Company hereby further undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the Company's
annual report pursuant to Section 13(a) or 15(d) of the Exchange Act 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.
17
<PAGE>
(c) The Company hereby further undertakes that:
(1) For purposes of determine any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of the
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus 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 posteffective amendment that contains a form of prospectus
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.
(d) Insofar as the 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.
18
<PAGE>
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 Hamilton, State of Montana, on the 5th day of
October, 1998.
RIBI IMMUNOCHEM RESEARCH, INC.
By: /s/ Robert E. Ivy
--------------------------
Robert E. Ivy
Chief Executive officer,
President and Chairman
Exhibit 24.1
POWERS OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Robert E. Ivy and Ronald H. Kullick, and
each of them, as his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
posteffective amendments) to this Registration Statement, and to file the same,
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 and necessary to be done in connection therewith
and about the premises, as fully to all intents and purposes as he 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.
19
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the dates included:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
Robert E. Ivy* President, Chief Executive October 5, 1998
- ---------------------------- Officer and Chairman ----------------
Robert E. Ivy (Principal Executive Officer)
Vern D. Child* Vice President - Finance October 5, 1998
- ---------------------------- and Treasurer ----------------
Vern D. Child (Principal Financial and
Accounting Officer)
John L. Cantrell* Director October 5, 1998
- ---------------------------- ----------------
John L. Cantrell
Philipp Gerhardt* Director October 5, 1998
- ---------------------------- ----------------
Philipp Gerhardt
Paul Goddard* Director October 5, 1998
- ---------------------------- ----------------
Paul Goddard
Mark I. Greene* Director October 5, 1998
- ---------------------------- ----------------
Mark I. Greene
Thomas N. McGowen, Jr.* Director October 5, 1998
- ---------------------------- ----------------
Thomas N. McGowen, Jr.
Frederick B. Tossberg* Director October 5, 1998
- ---------------------------- ----------------
Frederick B. Tossberg
*/s/ Robert E. Ivy
- ----------------------------
Robert E. Ivy
Attorney-in-Fact
20
<PAGE>
EXHIBIT INDEX
</TABLE>
<TABLE>
<CAPTION>
Exhibit
Number Description Page No.
- ------ ----------- -------
<S> <C> <C>
4.1 Restated Certificate of Incorporation of the Company
(Incorporated by reference to Exhibit 4.1 of the
Company's Registration Statement on Form S-3 filed
with the Commission on June 22, 1992, Registration
No. 33-48713)
4.2 Amended Bylaws of the Registrant (Incorporated by
reference to Exhibit 3.2 to the Company's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1988, File No. 0-11094)
5.1 Opinion of Ronald H. Kullick, Counsel for the Company 22
23.1 Consent of KPMG Peat Marwick LLP 23
23.2 Consent of Ronald H. Kullick, Counsel for the Company 22
(included in Exhibit 5.1)
24.1 Powers of Attorney (included as part of the Registration 19
Statement signature page)
</TABLE>
21
<PAGE>
Exhibits 5.1 and 23.2
[LOGO]
Ribi ImmunoChem Research, Inc.
553 Old Corvallis Road
Hamilton, Montana 59840 USA
(406) 363-6214
Fafx (406) 363-6129
October 5, 1998
Board of Directors
Ribi ImmunoChem Research, Inc.
553 Old Corvallis Road
Hamilton, MT 59840
Gentlemen:
I am legal counsel to Ribi ImmunoChem Research, Inc., a Delaware corporation
(the "Company"), in connection with the proposed registration of 5,493,333
shares of the Company's $.001 par value Common Stock ("Common Stock") to be
issued upon conversion of 8,240 shares of Convertible Preferred Stock purchased
by a certain holder named in the Company's Registration Statement on Form S-3
(Registration Statement 333-61435) pursuant to an agreement between the Company
and said certain holder of which Common Stock is to be offered and sold by said
holder.
I have examined and am familiar with the Company's Restated Articles of
Incorporation, its Bylaws, as amended, and such corporate and other records,
certificates and documents as I have considered necessary or appropriate for
purposes of this opinion. I am also familiar with the proceedings taken by the
Board of Directors of the Company to authorize the Company to issue said
Convertible Preferred Stock pursuant to the agreement with the holder and to
issue the shares of Common Stock upon conversion of said Convertible Preferred
Stock.
Based upon the foregoing, I am of the opinion that the 5,493,333 shares of
Common Stock to be issued upon conversion of the Convertible Preferred Stock in
accordance with the terms of the agreement between the Company and the holder
have been duly authorized and when issued will be validly issued, fully paid and
nonassessable.
I hereby consent to the filing of this opinion as an exhibit of the
aforementioned Registration Statement.
Very truly yours,
/s/ Ronald H. Kullick
Ronald H. Kullick
Vice President - Legal Counsel
and Secretary
RHK:kp
22
<PAGE>
Exhibit 23.1
[LOGO]
KPMG Peat Marwick LLP
1000 First Interstate Center
401 N. 31st Street
P.O. Box 7108
Billings, MT 59103
Independent Accountants' Consent
--------------------------------
The Board of Directors
Ribi ImmunoChem Research, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the registration statement.
Billings, Montana
October 5, 1998
23
