As filed with the Securities and Exchange Commission on May 12, 1998
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM S-3
Registration Statement
Under
The Securities Act of 1933
______________
EMISPHERE TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 13-3306985
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
15 Skyline Drive
Hawthorne, New York 10532
(914) 347-2220
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
______________
MICHAEL M. GOLDBERG, M.D.
c/o Emisphere Technologies, Inc.
15 Skyline Drive
Hawthorne, New York 10532
(914) 347-2220
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
With a copies to:
EDWIN S. MAYNARD, ESQ. M. WARREN BROWNE, ESQ. LAWRENCE A. DARBY, ESQ.
Paul, Weiss, Rifkind, Wharton 25 Five Ponds Drive Howard, Darby & Levin
& Garrison Waccabuc, New York 1330 Avenue of the
1285 Avenue of the Americas 10597 Americas
New York, New York 10019-6064 New York, New York 10019
Approximate date of commencement of proposed sale to the public: As soon
as practicable 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. _
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 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. _
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. _
CALCULATION OF REGISTRATION FEE
Proposed Proposed
maximum maximum
Title of securities Amount to be offering aggregate Amount of
to be registered registered price per offering registration
share price fee
Common Stock, $.01 1,202,500 shares $16.69 (2) $20,069,725 $5,921
par value (1) (1)(2)
(1) This Registration Statement also applies to rights under the registrant's
Rights Agreement which are attached to and tradable only with the shares of
Common Stock registered hereby. No registration fees are required for such
rights as they will be issued for no additional consideration.
(2) This Registration Statement shall, in accordance with Rule 416 under the
Securities Act of 1933, as amended, be deemed to cover such additional shares
as may be issued to prevent dilution resulting from stock splits, stock
dividends or similar transactions.
(3) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933, as amended,
based on the average of the high and low prices reported on the Nasdaq
National Market on May 7, 1998.
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.
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SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED MAY 12, 1998
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PROSPECTUS
1,202,500 Shares
EMISPHERE TECHNOLOGIES, INC.
Common Stock
This Prospectus relates to the offer and sale of up to 1,202,500 shares
(the "Shares") of the Common Stock, par value $.01 per share (the "Common
Stock"), of Emisphere Technologies, Inc. (the "Company") by certain persons
listed under the caption "Selling Shareholders" (collectively, the "Selling
Shareholders") that may be acquired from time to time by the Selling
Shareholders upon (i) conversion of the Company's 5% Senior Convertible Notes
due 2001 (the "Notes") and (ii) payment of interest on the Notes in shares, at
the Company's option, in lieu of cash.
While the Selling Shareholders have not advised the Company of any specific
plans for the distribution of the Shares, it is anticipated that the
distribution of the Shares may be effected from time to time by the Selling
Shareholders in one or more transactions for their own accounts (which may
include block transactions) in the over-the-counter market, on the Nasdaq
National Market or on any exchange on which the Common Stock may then be
listed, in negotiated transactions, through the writing of options on shares
(whether such options are listed on an options exchange or otherwise), or a
combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Shareholders may
effect such transactions by selling shares to or through broker-dealers, and
such broker-dealers may receive compensation in the form of discounts,
concessions or commissions from the Selling Shareholders and/or the purchasers
of shares for whom such broker-dealers may act as agent or to whom they sell as
principal, or both (which compensation as to a particular broker-dealer might
be in excess of customary commissions). The Selling Shareholders and any
participating brokers and dealers may be deemed to be "underwriters" as defined
in the Securities Act of 1933, as amended (the "Securities Act"). See "Selling
Shareholders" and "Plan of Distribution".
The Common Stock is quoted on the Nasdaq National Market under the symbol
"EMIS". The last sale price of the Common Stock on May , 1998, as reported
on the Nasdaq National Market, was $____ per share.
All expenses of registration incurred in connection herewith are being
borne by the Company, but all selling and other expenses incurred by a Selling
Shareholder will be borne by the Selling Shareholder. None of the proceeds
from the sale of the Shares will be received by the Company.
THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" STARTING ON
PAGE 4.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECU-
RITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COM-
MISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
The date of this Prospectus is May , 1998
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AVAILABLE INFORMATION
Emisphere Technologies, Inc. (the "Company" or "Emisphere") 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
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy statements and other information filed
by the Company can be inspected and copied at the public reference facilities
maintained by the Commission at its office at Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the Commission's regional offices located
at 7 World Trade Center, Suite 1300, New York, New York 10048 and Northwestern
Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of this material can also be obtained from the Commission's web site at
"http://www.sec.gov" and at prescribed rates from the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Company's Common Stock is quoted on the Nasdaq National Market. Reports, proxy
statements and other information concerning the Company can be inspected at the
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement on Form
S-3 under the Securities Act with respect to the shares of Common Stock offered
hereby. This Prospectus does not contain all the information set forth in the
Registration Statement and the exhibits and schedules thereto. For further
information with respect to the Company and the shares of Common Stock offered
hereby, reference is made to the Registration Statement, exhibits and
schedules.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company with the Commission
pursuant to the Exchange Act are incorporated by reference in this Prospectus:
(1) Annual Report on Form 10-K for the fiscal year ended July 31, 1997;
(2) Quarterly Report on Form 10-Q for the quarter ended October 31, 1997;
(3) Quarterly Report on Form 10-Q for the quarter ended January 31, 1998;
(4) Current Report on Form 8-K dated May 1, 1998;
(5) The description of the Company's preferred stock purchase rights
contained in its Registration Statement on Form 8-A, dated March 5,
1996; and
(6) The description of the Company's Common Stock contained in its
Registration Statement on Form 8-A, dated September 11, 1990.
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 and prior
to the termination of the offering of the Common Stock hereunder shall be
deemed to be incorporated by reference herein and to be a part hereof from the
date of the filing of such reports and documents. The Company will provide a
copy of any or all of such documents (exclusive of exhibits unless such
exhibits are specifically incorporated by reference therein), without charge,
to each person to whom this Prospectus is delivered, including any beneficial
owner, upon written or oral request to: Emisphere Technologies, Inc., 15
Skyline Drive, Hawthorne, New York 10532, Attention: Secretary (telephone
(914) 347-2220).
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Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for the purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed
to be incorporated by reference herein modifies or supersedes such 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's principal executive offices are located at 15 Skyline Drive,
Hawthorne, New York 10532 and its telephone number is (914) 347-2220.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this Prospectus, under the caption "Risk Factors" and
elsewhere, constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Reform Act"). Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements
of the Company, or industry results, to be materially different from any future
results, performance, or achievements expressed or implied by such
forward-looking statements. Such factors are set forth more fully under the
caption "Risk Factors."
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RISK FACTORS
In addition to the other information contained in this Prospectus, the
following risk factors should be considered carefully before purchasing the
Common Stock offered hereby. This Prospectus contains forward-looking
statements within the meaning of the Securities Act and the Exchange Act. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements
of the Company, or industry results, to be materially different from any future
results, performance, or achievements expressed or implied by such forward-
looking statements. Such factors include, among others, the risk factors set
forth below.
Early Stage of Product Development; Uncertainties Relating to Clinical Trials
The Company's research and development efforts have not resulted in any
commercial products to date. The Company is not aware of any oral formulation
of a therapeutic macromolecule for systemic delivery that has been approved by
the U.S. Food and Drug Administration (the "FDA"). There can be no assurance
that the Company will be able to develop commercially any product based on its
carrier technologies. All of the Company's product candidates are in the
research or development stage, and there have been no product sales to date.
Operations to date have been funded with the proceeds from collaborative
research agreements, financings and interest income earned on the investment of
these funds. There can be no assurance that product revenues can be realized on
a timely basis, if ever.
A number of companies in the drug delivery, biotechnology and pharmaceutical
industries have suffered significant setbacks in clinical trials, even after
showing promising results in earlier studies or trials. Although the Company
has conducted preclinical studies of certain carriers and carriers in
combination with various therapeutic compounds and has conducted four Phase I
clinical trials for the oral delivery of heparin, any favorable results of
these studies may not be predictive of results that will ultimately be obtained
in or throughout future clinical trials. There can be no assurance that results
of the Company's limited animal and human studies are indicative of results
which would be achieved in additional animal studies or human clinical studies,
all or some of which will be required with respect to various of the Company's
proposed products before regulatory approval can be obtained, and there can be
no assurance that such approval will be granted. With the exception of its
Phase I clinical trials for heparin, the Company has not completed any other
human clinical trials using its current carriers, including any trials for the
delivery of any therapeutic proteins. The Company has not yet identified the
optimum formulation of carrier for any drug nor has the Company arrived at a
final manufacturing process for a finished product. Furthermore, it is possible
that effective formulation with the Company's carriers may not be possible for
certain drugs. In that event, the Company would most likely be unable to pursue
commercialization arrangements with respect to those drugs. There can be no
assurance that the Company will not encounter problems in its clinical trials
that will cause the Company to delay or suspend its clinical trials, that the
clinical trials will be completed at all, that such testing will ultimately
demonstrate the efficacy of its product candidates or that any product
candidates will receive regulatory approval on a timely basis, if at all. In
addition, certain of the therapeutic compounds being tested for delivery by the
Company's carriers have not yet been approved. If any such problems occur, the
Company could be materially adversely affected.
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Need for Regulatory Approval of Products
The Company's preclinical studies and clinical trials and the manufacturing
and marketing of its carriers and technologies are subject to extensive, costly
and rigorous regulation by various governmental authorities in the United
States and other countries. The process of obtaining required regulatory
approvals from the FDA and other regulatory authorities often takes many years,
is expensive and can vary significantly based on the type, complexity and
novelty of the product candidates. There can be no assurance that any
technologies or carriers developed by the Company, independently or in
collaboration with others, will meet applicable regulatory criteria to receive
the required approvals for manufacturing and marketing. Delays in obtaining
United States or foreign approvals could result in substantial additional costs
to the Company and adversely affect the Company's competitive position. In
addition, delays in obtaining regulatory approvals that may be encountered by
corporate collaborators or other licensees of the Company could adversely
affect the Company's business and prospects.
The Company has neither sought nor received regulatory approval for the sale
of any products in the United States or in any foreign country. The Company has
completed Phase I clinical trials in the United States for one of its drug
delivery technologies for heparin, but there can be no assurance that the FDA
will permit further testing in a timely fashion, if at all. Delays or
rejections may be encountered for a number of reasons, including changes in FDA
policy during the period of product development and FDA regulatory review.
Similar delays may also be encountered in other countries. There can be no
assurance that even after such time and expenditures, regulatory approval will
be obtained for any products developed by the Company. If regulatory approval
of a product is granted, such approval may entail limitations on the indicated
uses for which the product may be marketed. Further, even if regulatory
approval is obtained, a marketed product, its manufacturer, and its
manufacturing facilities are subject to continual review and periodic
inspections, and later discovery of previously unknown problems with a product,
manufacturer, or facility may result in restrictions on such product,
manufacturer, or facility including withdrawal of the product from the market.
If the Company is unable to obtain regulatory approvals for product candidates
on a timely basis, or if the Company is unable to continue to be in regulatory
compliance, the Company's business and prospects will be materially adversely
affected.
Any new dosage form of any drug is required to undergo rigorous preclinical
and clinical testing and an extensive review process mandated by the FDA and
equivalent foreign authorities prior to marketing. There can be no assurance
that the Company will develop commercially viable products, that the necessary
regulatory approvals for any of the Company's product candidates will be
obtainable or that, if such approvals are obtainable, they will be forthcoming
on a timely basis. These review and approval processes can take several years
and require the expenditure of substantial resources.
Dependence Upon Partnerships with Pharmaceutical Companies
Revenues from the Company's drug delivery technologies will be dependent upon
the production and sale of products utilizing the Company's technologies. The
Company does not currently possess the ability or resources necessary to
complete on its own the development, testing, regulatory approval process and
commercialization for pharmaceutical products utilizing its drug delivery
technologies and the Company does not currently intend independently to market
products incorporating its technologies in the foreseeable future. It is the
Company's strategy to seek to enter into agreements with pharmaceutical
companies which will assist the Company in developing, testing and obtaining
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government approval for, and the marketing and commercialization of, the
various formulations of its drug delivery technologies. Other than a joint
venture with Elan Corporation plc ("Elan") for the development and
commercialization of an oral heparin and low molecular weight heparin product,
a strategic alliance with Eli Lilly and Company ("Lilly") for the development
and commercialization of certain of Lilly's therapeutic proteins and a research
collaboration with Novartis Pharma AG ("Novartis") to investigate the Company's
technology for oral delivery of two selected Novartis compounds, no commitments
or development agreements are currently in effect. The Company has entered into
several feasibility and other preliminary arrangements with pharmaceutical
companies other than Novartis, Lilly and Elan, certain of which were terminated
due to the inability of the Company's then-existing technology to meet
satisfactory performance levels and none of which resulted in the development
of any product or the creation of any long-term relationship. There can be no
assurance that the Company will be able to enter into additional collaborative
arrangements with respect to product development utilizing the Company's drug
delivery technologies, that any existing or future collaborative arrangements
will be successful, that milestones in such agreements will be met or that the
terms of any future development agreements entered into will be favorable to
the Company. If the Company is unable to obtain development assistance and
funds from pharmaceutical companies to fund a portion of its product
development costs and to commercialize products, the Company may have to delay,
scale back or curtail one or more of its activities. In the event no other
pharmaceutical company enters into a development agreement with the Company,
the Company may not have the financial resources to undertake the necessary
research into, or the commercial development of, products.
The research collaboration with Novartis, the strategic alliance with Lilly
and the joint venture with Elan each presents certain particular risks to the
Company. The Company's agreement with Novartis provides for an initial research
collaboration period of at least 12 months and an option on the part of
Novartis to acquire a license to use the Company's technologies for the
development and commercialization of oral formulations of the Novartis
compounds. There is no assurance that the research results desired by Novartis
will be achieved or that, even if achieved, Novartis will proceed with the
research collaboration or exercise its license option. The Company's agreement
with Lilly provides for an initial research collaboration period of 18 to 24
months and a series of options each to acquire an exclusive, worldwide license
to use the Company's technologies in connection with certain therapeutic
proteins selected by Lilly. While Lilly has exercised its option to acquire
such a license with respect to two such proteins and Lilly is currently
pursuing the development of formulations for oral delivery of such proteins,
the license agreements are subject to termination at any time by Lilly.
Furthermore, while the license agreements provide for payments upon reaching
certain milestones and for royalties in the event a product is successfully
commercialized by Lilly, there is no provision for minimum royalty payments and
therefore no assurance that the Company will ever receive additional revenues
from the license agreements. In addition, because the agreement also provides
Lilly with a right of first refusal with respect to the use of the Company's
technologies for the delivery of certain other specified therapeutic proteins
and contemplates the possibility of a continuing relationship for the
development of delivery systems for other therapeutic proteins, other potential
collaborators may be discouraged from negotiating collaboration agreements with
the Company. The strategic alliance does not require Lilly to use the Company's
technologies exclusively and the Company is aware of collaborations between
Lilly and others pursuing non-oral delivery of one of the same proteins that
are the subject of the strategic alliance. However, the strategic alliance
represents the exclusive vehicle through which the Company may develop and
market orally deliverable products based on the subject proteins and the
Company's carrier technologies.
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With respect to the joint venture with Elan, the Company may not have the
necessary resources to comply with its obligation to satisfy 50% of the joint
venture's financial requirements and the commercialization of the covered
products could likely require significant financial resources that ultimately
may not be available to the joint venture. In addition, the failure of the
Company to satisfy its share of the financial requirements of the joint
venture, a change of control of the Company or certain disagreements between
Elan and the Company could result in a forced sale by the Company to Elan of
the Company's interest in the joint venture company. Further, because the joint
venture also provides the joint venture company with a right of first refusal
with respect to the use of the Company's technologies for the delivery of
anticoagulant compounds, other potential collaborators may be discouraged from
negotiating collaboration agreements with the Company.
In negotiating development agreements, the Company intends to seek funding
with respect to a portion of development costs necessary to commercialize the
product candidate or candidates to which a development agreement applies. The
Company expects that the parties to development agreements will want the legal
right to abandon a product candidate at any time for any reason without
significant penalty and there can be no assurance that such right will not be
exercised. Further, potential and existing development partners may have no
obligation to deal exclusively with the Company in developing new drug delivery
methods for their drugs and may pursue parallel development of oral delivery or
other drug delivery technologies, on their own or with other collaborative
partners, which may compete with the Company's oral drug delivery technologies.
Moreover, the terms of any future development agreements, if any, with respect
to a particular drug may preclude or restrict the Company from entering into
alternative arrangements with other pharmaceutical companies for the same or
competing drugs.
The Company has no control over the resources and attention devoted by its
partners to the development of a product candidate and, to the extent resources
devoted are limited, the Company may be adversely affected. If any of the
Company's collaborators breaches or terminates its agreement with the Company
or otherwise fails to conduct its collaborative activities in a timely manner,
the development or commercialization of the product candidate or research
program under such collaborative agreement may be delayed, and the Company may
be required to devote unforeseen additional resources to continue such
development or commercialization, or terminate such programs. The termination
of collaborative arrangements could have a material adverse effect on the
Company's business, financial condition and results of operations. There can be
no assurance that disputes will not arise in the future with respect to the
ownership of rights to any technology developed with third parties. These and
other possible disagreements between collaborators and the Company could lead
to delays in the collaborative research, development or commercialization of
certain product candidates, or could require or result in litigation or
arbitration, which would be time consuming and expensive and would have a
material adverse effect on the Company's business, financial condition and
results of operations.
Highly Competitive Industry and Risk of Technological Obsolescence
Drug delivery, biotechnology and pharmaceutical science are evolving fields
in which developments are expected to continue at a rapid pace. The Company's
success depends, in part, upon maintaining a competitive position in the
development of products and technologies in its areas of focus. The Company is
in competition with other drug delivery, biotechnology and pharmaceutical
companies, research organizations, individual scientists and non-profit
organizations engaged in the development of alternative drug delivery
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technologies or new drug research and testing, as well as with entities
developing new drugs which may be orally active. The Company is aware that a
number of companies are seeking to develop new products and alternatives to
traditional injectable drug delivery, including, but not limited to, intranasal
delivery, pulmonary systems, transdermal systems, buccal and sublingual
systems, colonic absorption systems, as well as sustained-released injectable
systems. The Company also is aware of other companies currently engaged in the
development and commercialization of oral drug delivery technologies and
enhanced injectable systems. Many of these companies have greater research and
development capabilities, experience, and marketing, financial and managerial
resources than the Company, and represent significant competition for the
Company. Acquisitions of or investments in competing drug delivery or
biotechnology companies by large pharmaceutical companies could enhance
competitors' financial, marketing and other resources. In addition, a number of
these competing drug delivery and biotechnology companies have entered into
collaboration or other agreements with large pharmaceutical companies which
could similarly enhance these competitors' resources. Accordingly, the
Company's competitors may succeed in developing competing technologies or
obtaining regulatory approval for products more rapidly than the Company. There
can be no assurance that developments by others will not render the Company's
product candidates or the therapeutic compounds used in combination with the
Company's product candidates uncompetitive or obsolete.
Dependence on Patents and Proprietary Rights
The Company's success, competitive position and future revenues will depend,
in part, on the ability of the Company and its partners to obtain patent
protection in various jurisdictions related to their technologies, processes
and products and to preserve effectively their trade secrets. The Company has
filed, and expects to continue to file, patent applications seeking such
protection. The Company has been granted 18 patents on its drug delivery
technologies in the United States which will expire beginning in 2007, and has
certain patents issued or applications pending in various countries around the
world. Ten U.S. patent applications have been allowed by the U.S. Patent and
Trademark Office. The Company has 52 patent applications relating to its drug
delivery technologies pending in the United States, including the allowed
applications and the applications relating to the therapeutic proteins that are
the subject of the strategic alliance with Lilly. In addition, the Company has
pending or expects to file patent applications corresponding to most of its
U.S. patents and patent applications in various countries around the world. The
Company has applied to have one of its granted U.S. patents reissued in an
attempt to obtain certain broader claims to which the Company believes it was
entitled in the original patent grant. While the reissue application has been
allowed, the reissue patent has not yet been issued and there is no guarantee
that it will in fact be issued. There can be no assurance that any patent
applications existing or relating to the Company's potential products or
processes will result in patents being issued, or that resulting patents, if
any, are valid, enforceable or will provide protection against competitors who
successfully challenge the Company's patents, obtain patents that may have an
adverse effect on the Company's ability to conduct business, or are able to
circumvent the Company's patent position. It is possible that conflicting
patents that were not previously located have been issued and/or that other
parties have conducted research or made discoveries of compounds or processes
that preceded the Company's discoveries and which could prevent the Company
from obtaining patent protection, or could narrow the scope of any protection
obtained. There can be no assurance that the manufacture, use or sale of the
Company's product candidates will not infringe patent rights of others. The
Company may be unable to avoid infringement of those patents and may have to
seek a license, defend an infringement action, or challenge the validity of the
patents in court. There can be no assurance that a license will be available to
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the Company, if at all, upon terms and conditions acceptable to the Company or
that the Company will prevail in any patent litigation. Patent litigation is
costly and time consuming, and there can be no assurance that the Company will
have sufficient resources to pursue such litigation. If the Company does not
obtain a license under such patents, is found liable for infringement, or is
not able to have such patents declared invalid, the Company may be liable for
significant monetary damages, may encounter significant delays in bringing
products to market, or may be precluded from participating in the manufacture,
use or sale of products or methods of treatment covered by such patents. There
can be no assurance that the Company has identified or will identify in the
future, United States and foreign patents that pose a risk of infringement.
The Company's strategy involves collaborative arrangements with other
pharmaceutical companies for the development of new formulations of drugs
developed by others and, ultimately, the receipt of royalties on sales of the
new formulations of the drugs. These drugs are generally the property of the
pharmaceutical companies and may be the subject of patents or patent
applications and other forms of protection owned by such pharmaceutical
companies. To the extent such patents or other forms of protection expire,
become invalid or otherwise ineffective or such drugs are covered by patents or
other forms of protection owned by third parties, sales of such drugs by the
collaborating pharmaceutical company may be restricted, limited or enjoined, or
may cease. Accordingly, the potential for royalty revenues to the Company may
be adversely affected.
To protect its proprietary technologies and processes, the Company also
relies in part on maintaining trade secrets protected by confidentiality
agreements with its partners, employees, consultants and certain contractors.
There can be no assurance that the Company's trade secrets are enforceable or
that its confidentiality agreements have not been or will not be breached, that
as a practical matter the Company will have adequate remedies for any breach,
or that the Company's trade secrets will not otherwise become generally known
or be independently discovered by competitors and thus cease being protected.
Absence of Profitable Operations; Need for Additional Capital
Since its inception in April 1985, the Company has generated significant
losses from operations and for the foreseeable future the Company anticipates
that it will continue to generate significant losses from operations. At
January 31, 1998, the Company's accumulated deficit was approximately $55
million. Operations to date have been funded with the proceeds from
collaborative research agreements, financings and interest income earned on the
investment of these funds. The Company does not expect to achieve profitability
in the foreseeable future. Profitability in the long term will depend on the
Company's ability to gain regulatory approval for one or more products and to
market such products successfully. The Company will require substantial
additional funding in order to continue its research and product development
programs and preclinical testing and clinical trials of its product candidates,
for operating expenses, for the pursuit of regulatory approvals of its product
candidates, and for establishing manufacturing and marketing capabilities.
While the Company believes that existing cash, cash equivalents and marketable
securities will be sufficient to satisfy the Company's operating needs for at
least the next 12 months, circumstances could arise which may result in a need
to raise additional capital in the future. The Company has in the past raised
additional capital through public offerings of its Common Stock and private
equity financings. There can be no assurance that additional equity capital
will be available on acceptable terms, or without severe dilution to the
existing stockholders, if at all. If adequate funds are not available, the
Company will be required to delay, scale back or eliminate some or all of its
research or development programs or relinquish rights to certain of its
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technologies, product candidates or products that the Company would not
otherwise relinquish.
Dependence on Others for Manufacturing of the Company's Chemical Compounds
The Company currently has no manufacturing facilities for large-scale
clinical or commercial production of any compounds under consideration as
products. The Company is producing some material for research and preclinical
testing and has been supplied with larger lots of compound by contract
manufacturing companies. For the foreseeable future, the Company does not
intend to manufacture its carriers except for the foregoing limited purposes.
If the Company is unable to contract for manufacturing on acceptable terms or
if the Company cannot obtain compounds manufactured on a large scale and in
accordance with specifications on a timely basis or if the contract
manufacturer fails to comply with FDA regulations pertaining to current Good
Manufacturing Practices ("GMP"), the ability to conduct preclinical and human
clinical trials will be adversely affected, resulting in the delay of product
development and submission of products for regulatory approval, which in turn
could materially impair the Company's ability to achieve profitability.
Under the Elan joint venture, the Company is obligated to provide the joint
venture company with a supply of carriers for the clinical testing program.
Moreover, under the strategic alliance with Lilly, the Company is obligated to
provide a material portion of the supply of carrier necessary for the
production of any product manufactured pursuant to the strategic alliance.
Should the Company be unable to provide the specific amounts of carrier in the
required time periods, or if the contract manufacturer fails to comply with
FDA's current GMP regulations, delays to the development of any such products
could occur which could materially adversely affect the Company's results.
Risks of Product Liability Claims and Current Limit of Product Liability
Insurance; Potential Liability for Human Clinical Trials
The Company has product liability insurance with a policy limit of only $1.0
million per occurrence and $1.0 million for all occurrences and the Elan joint
venture company has agreed to maintain product liability insurance with a
policy limit to be determined. The testing, manufacturing and marketing of
products for humans utilizing the Company's drug delivery technologies may
expose the Company to potential product liability and other claims resulting
from their use. Liability may result from claims made directly by consumers or
by pharmaceutical companies or others selling products. Because the Company
seeks to structure future development programs with the intention of developing
commercially viable products for sale or license to pharmaceutical companies
which would complete the development, manufacturing and marketing of the
finished product, the Company intends to rely on indemnity undertakings by the
pharmaceutical companies with regard to liability. There can be no assurance
that the Company will be able to negotiate appropriate indemnity undertakings
with pharmaceutical partners or that indemnity undertakings will be effective
to protect the Company from liability or the costs of product liability
litigation. While the Company may obtain additional product liability insurance
if management determines that such insurance is desirable, there can be no
assurance that the Company will apply for, or be able to obtain, insurance on
acceptable terms, or that insurance, if obtained, would be adequate to fully
protect the Company against any potential liability. In the event of a
successful suit against the Company, if the Company does not have adequate
product liability insurance coverage, the Company will be materially adversely
affected.
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In addition to product liability risks associated with sales of products, the
Company may be liable for the claims of individuals who participate in human
clinical trials of its products. The Company intends to have human clinical
trials conducted by pharmaceutical partners, and the Company will seek to have
these partners indemnify the Company for claims arising out of the trials.
There can be no assurance that the Company will be able to negotiate
appropriate indemnity undertakings with pharmaceutical partners or that
indemnity undertakings will be effective to protect the Company from liability
or the costs of product liability litigation. While the Company has obtained,
and will seek, waivers of liability from all persons who participated or may in
the future participate in human clinical trials conducted by or on behalf of
the Company, there can be no assurance that waivers will be effective to
protect the Company from liability or the costs of product liability
litigation. In the event of a successful suit against the Company, if the
Company does not have adequate product liability insurance coverage, the
Company will be materially adversely affected.
Dependence on Key Personnel
The Company's success depends upon the continued contributions of its
executive officers and scientific and technical personnel. During the Company's
operating history, many key responsibilities within the Company have been
assigned to a relatively small number of individuals. The competition for
qualified personnel is intense, and the loss of services of certain key
personnel could adversely affect the business of the Company. In particular,
the loss of the services of, among others, Michael M. Goldberg, M.D., the
Company's Chairman of the Board and Chief Executive Officer, or Sam J.
Milstein, Ph.D., the Company's President and Chief Scientific Officer, could
have a material adverse effect on the Company's operations. The Company has
employment agreements through July 31, 2000 with each of Drs. Goldberg and
Milstein and has obtained key man life insurance in the amount of $1.0 million
on the lives of each of Drs. Goldberg and Milstein.
Uncertain Availability of Third-Party Reimbursement
The Company's commercial success could depend in part on the availability of
reimbursement from third-party payors such as government health administration
authorities, private health insurers and other organizations. Third-party
payors are increasingly challenging the price and cost-effectiveness of medical
products and services. Significant uncertainty exists as to the reimbursement
status of newly approved health care products. If the Company succeeds in
bringing products to market, there can be no assurance that the Company's
products will be considered by third-party payors to be cost effective or
outcome effective or that adequate third-party reimbursement will be available
to enable the Company to maintain price levels sufficient to realize an
appropriate return on its investment in product development. Legislation and
regulations affecting the pricing of pharmaceuticals may change before the
Company's proposed products are approved for marketing and any such changes
could further limit reimbursement for medical products.
Possible Adverse Impact on Holders of Common Stock; Antitakeover Provisions
There exist a number of factors that could have the effect of delaying,
deferring or preventing a change in control of the Company, may discourage bids
for the Common Stock at a premium over the market price of the Common Stock,
and may, as a result, adversely effect the market price of the Common Stock.
Such factors include: contractual provisions with Elan, Lilly and Novartis that
prohibit (subject to certain exceptions) each from acquiring shares of the
Company's outstanding voting stock above certain specified levels; certain
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<PAGE>
antitakeover provisions contained in the Company's Certificate of Incorporation
and By-laws, certain provisions of Delaware law and the Company's stockholder
rights plan that are each designed to prevent any unsolicited acquisitions; and
the fact that a change in control of the Company would constitute a default
under the Elan joint venture agreement with potential adverse effects on the
Company.
Potential Volatility of Stock Price
The market prices for securities of drug delivery, biotechnology and
pharmaceutical companies, including the Company's Common Stock, have
historically been highly volatile and the market has from time to time
experienced significant price and volume fluctuations that are unrelated to the
operating performance of particular companies. Factors such as fluctuations in
the Company's operating results, announcements of technological collaborations,
innovations or new products by the Company or its competitors, governmental
regulation, developments in patent or other proprietary rights, public concern
as to the safety of drugs developed by the Company or others and general market
conditions may have a significant effect on the market price of the Common
Stock. The Company's securities are subject to a high degree of risk and
volatility. Investors should be aware that other investment opportunities, such
as interest-bearing obligations, may result in a higher yield on investment and
be less subject to fluctuation and risk of loss than an investment in the
Company's Common Stock.
Shares Eligible for Future Sale; Effect of the Options and Warrants and the
Notes Outstanding
The issuance of freely tradeable Common Stock upon the exercise of stock
options and warrants and upon conversion of the Notes, as well as future sales
of Common Stock by existing stockholders, or the perception that sales could
occur, could adversely affect the market price of the Common Stock.
As of January 31, 1998, the Company had outstanding options and warrants to
purchase up to 4,411,489 shares of Common Stock which are exercisable over the
next several years, giving the holders of such options and warrants an
opportunity to profit from a rise in the market price of the Company's Common
Stock with a resulting dilution in the interests of the other stockholders. In
addition, upon conversion of the Notes and payment of interest thereon in
shares of the Common Stock (at the option of the Company) in lieu of cash, the
Shares (consisting of up to 1,202,500 additional shares of the Common Stock)
will all be freely tradable. The terms on which the Company may obtain
additional financing during the period when such options and warrants and the
Notes are exercisable may be adversely affected by the existence of such
options and warrants and the Notes.
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<PAGE>
SELLING SHAREHOLDERS
The table below sets forth information regarding the Selling Shareholders
as of the date of this Prospectus as to (i) the name of each Selling
Shareholder (none of which have had positions, offices or other material
relationships with the Company during the past three years), (ii) the number of
shares of the Common Stock owned beneficially or of record by each such Selling
Shareholder, (iii) the number of shares of the Common Stock being offered
hereby from time to time by such Selling Shareholder and (iv) the number of
shares of the Common Stock to be owned by such Selling Shareholder after
completion of the offering, assuming all the Shares being offered from time to
time hereby are sold.
The Shares being offered hereby by the Selling Shareholders may be
acquired, from time to time, upon the conversion of $13,500,000 aggregate
principal amount of the Notes acquired by them from the Company in a private
placement transaction pursuant to those certain Note Purchase Agreements dated
as of May 1, 1998 and the payment by the Company of interest on the Notes in
the form of Common Stock in lieu of cash, at the Company's option. The Notes
can be converted in whole or in part at any time at a conversion price equal to
the lowest trading price of the Common Stock as reported on the Nasdaq National
Market during the ten consecutive trading immediately preceding the date of
conversion provided that the conversion price may in no event be lower than
$10.00 per share. In addition, the Selling Shareholders may not acquire in
excess of 1,000,000 shares of the Common Stock upon conversion of the Notes
without the Company's permission.
In accordance with registration rights granted to the Selling
Shareholders, the Company has filed with the Commission, under the Securities
Act, a Registration Statement on Form S-3, of which this Prospectus forms a
part, with respect to the resale of the Shares from time to time on the Nasdaq
National Market or in privately-negotiated transactions and has agreed to
prepare and file such amendments and supplements to the Registration Statement
as may be necessary to keep such Registration Statement effective until the
Shares are no longer required to be registered for the sale thereof by the
Selling Shareholders.
Number Number Ownership
of Shares of Shares After Offering
Owned Prior Being Number Percent
Name of Selling Shareholder to Offering(1) Offered of Shares of Class
Delta Opportunity Fund, Ltd.(2)(3) 757,130 757,130 - -
OTATO Limited Partnership (3) 89,074 89,074 - -
Fisher Capital Ltd. (4) 213,065 213,065 - -
Wingate Capital Ltd. (4) 114,727 114,727 - -
CCG Capital Ltd. (4) 14,252 14,252 - -
CCG Investment Fund Ltd. (4) 14,252 14,252 - -
___________________________
(1) Represents the respective number of shares that may be acquired by each of
the Selling Shareholders, assuming that the maximum number of shares are
issued upon conversion of all of the Notes and that the Company exercises
its option to pay interest on the Notes in shares. Pursuant to the terms
of the Notes, a Selling Shareholder may not convert any portion of the
Notes if such conversion would increase such Selling Shareholder's
beneficial ownership of the Common Stock (other than those shares deemed
owned because of the ownership of the remaining portion of the Notes) to in
excess of 4.9% of the Common Stock outstanding.
(2) Diaz & Altschul Advisors, LLC, a New York limited liability company ("D&A
Advisors), serves as investment advisor to Delta Opportunity Fund, Ltd.
("Delta") and may be deemed to share beneficial ownership of the shares
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<PAGE>
beneficially owned by Delta by reason of shared power to dispose of the
portion of the Shares beneficially owned by Delta. D&A Advisors is
controlled by Diaz & Altschul Group, LLC ("D&A Group"). D&A Advisors and
D&A Group disclaim beneficial ownership of the portion of the Shares
beneficially owned by Delta.
(3) An affiliate of OTATO Limited Partnership serves as a trading consultant to
Delta and may be deemed to share beneficial ownership of the portion of the
Shares beneficially owned by Delta by reason of shared power to dispose of
the Shares beneficially owned by such Selling Shareholder. Such affiliate
disclaims beneficial ownership of such portion of the Shares.
(4) Citadel Limited Partnership is the trading manager of each of Fisher
Capital Ltd., Wingate Capital Ltd., CCG Capital Ltd. and CCG Investment
Fund Ltd. (collectively, the "Citadel Entities") and consequently has
voting control and investment discretion over securities held by the
Citadel Entities. The ownership information for each of the Citadel
Entities does not include the ownership information for the other Citadel
Entities. Citadel Limited Partnership and each of the Citadel Entities
disclaims beneficial ownership of the portion of the Shares held by the
other Citadel Entities.
PLAN OF DISTRIBUTION
The Company will receive no proceeds from this offering. The Shares
offered hereby may be sold by the Selling Shareholders or by pledgees, donees,
transferees or other successors in interest that receive such shares as a gift,
partnership distribution or other non-sale related transfer. The Shares may be
sold from time to time in transactions on the Nasdaq National Market, in the
over-the-counter market, in negotiated transactions, or a combination of such
methods of sale, at fixed prices which may be changed, at market prices
prevailing at the time of sale, at prices related to prevailing market prices
or at negotiated prices. The Selling Shareholders may effect such transactions
by selling the Shares to or through broker-dealers, including block trades in
which brokers or dealers will attempt to sell the Shares as agent but may
position and resell the block as principal to facilitate the transaction, or in
one or more underwritten offerings on a firm commitment or best effort basis.
Sales of Selling Shareholders' Shares may also be made pursuant to Rule 144
under the Securities Act, where applicable.
To the extent required under the Securities Act, the aggregate amount of
Selling Shareholders' Shares being offered and the terms of the offering, the
names of any such agents, brokers, dealers or underwriters and any applicable
commission with respect to a particular offer will be set forth in a supplement
to accompany this Prospectus. Any underwriters, dealers, brokers or agents
participating in the distribution of the Shares may receive compensation in the
form of underwriting discounts, concessions, commissions or fees from a Selling
Shareholder and/or purchasers of Selling Shareholders' Shares, for whom they
may act (which compensation as to a particular broker-dealer might be in excess
of customary commissions).
From time to time, one or more of the Selling Shareholders may pledge,
hypothecate or grant a security interest in some or all of the Shares owned by
them, and the pledgees, secured parties or persons to whom the Shares have been
hypothecated shall, upon foreclosure in the event of default, be deemed to be
"Selling Shareholders" hereunder. In addition, a Selling Shareholder may, from
time to time, sell short the Common Stock of the Company, and in such
instances, this Prospectus may be delivered in connection with such short sales
and the Shares offered hereby may be used to cover such short sales.
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<PAGE>
A Selling Shareholder may enter into hedging transactions with broker-
dealers and the broker-dealers may engage in short sales of the Common Stock in
the course of hedging the positions they assume with such Selling Shareholder,
including, without limitation, in connection with distributions of the Common
Stock by such broker-dealers. A Selling Shareholder may also enter into option
or other transactions with broker-dealers that involve the delivery of the
Common Stock to the broker-dealers, who may then resell or otherwise transfer
such Common Stock. A Selling Shareholder may also loan or pledge the Common
Stock to a broker-dealer and the broker-dealer may sell the Common Stock so
loaned or upon a default may sell or otherwise transfer the pledged Common
Stock.
In order to comply with the securities laws of certain states, if
applicable, the Shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
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.
The Selling Shareholders and any broker-dealers or agents that participate
with the Selling Shareholders in the distribution of the Shares may be deemed
to be "underwriters" within the meaning of the Securities Act, and any
commissions received by them 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.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the Shares may not bid for or purchase shares of
Common Stock during a period which commences one business day (5 business days,
if the Company's public float is less than $25 million or its average daily
trading volume is less than $100,000) prior to such person's participation in
the distribution, subject to exceptions for certain passive market making
activities. In addition and without limiting the foregoing, each Selling
Shareholder will be subject to applicable provisions of the Exchange Act and
the rules and regulations thereunder, including, without limitation, Regulation
M, which provisions may limit the timing of purchases and sales of shares of
the Company's Common Stock by such Selling Shareholder.
The Notes were originally issued to the Selling Shareholders pursuant to
an exemption from the registration requirements of the Securities Act provided
by Section 4(2) thereof. The Company agreed to register the Shares issuable
upon conversion of the Notes under the Securities Act and to indemnify and hold
the Selling Shareholders harmless against certain liabilities under the
Securities Act that could arise in connection with the sale by the Selling
Shareholders of the Shares. The Company has agreed to pay all reasonable fees
and expenses incident to the filing of this Registration Statement.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for
the Company by M. Warren Browne, Esq.
EXPERTS
The financial statements and financial statement schedule of Emisphere
Technologies, Inc., as of July 31, 1997 and 1996 and for each of the three
years in the period ended July 31, 1997, included in the Company's Annual
Report on Form 10-K for the year ended July 31, 1997, incorporated by reference
in this Prospectus, have been incorporated herein in reliance on the report of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.
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<PAGE>
No person is authorized in
connection with the offering
made hereby to give any
information or to make any 1,202,500 shares
representation not contained
or incorporated by reference
in this Prospectus, and any
information or representation
not contained or incorporated
herein must not be relied upon
as having been authorized by EMISPHERE TECHNOLOGIES, INC.
the Company or the Selling
Shareholders. This Prospectus
does not constitute an offer
to sell or a solicitation of
an offer to buy by any person Common Stock
in any jurisdiction in which par value $.01 per share
it is unlawful for such person
to make such offer or
solicitation. Neither the
delivery of this Prospectus at
any time nor any sale made
hereunder shall under any
circumstance imply that the
information contained herein
is correct as of any date _____________
subsequent to the date hereof.
PROSPECTUS
TABLE OF CONTENTS _____________
Page
Risk Factors............... 4
Selling Shareholders....... 13 May , 1998
Plan of Distribution....... 14
Legal Matters.............. 15
Experts.................... 15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with this offering are:
SEC registration fee.................... $ 5,921
Nasdaq National Market listing fee...... 17,500
Transfer Agent and Registrar fees....... 1,000
Accounting fees and expenses............ 10,000
Legal fees and expenses................. 10,000
Miscellaneous........................... 5,579
Total................................ $50,000
The Company has agreed to pay all of the costs and expenses of this
offering.
Item 15. Indemnification of Directors and Officers
Pursuant to Section 145 of the General Corporation Law of the State of
Delaware, Article Twelfth of the Certificate of Incorporation of the Company
and Article V of the By-laws of the Company, the Company is authorized to
indemnify, subject to certain conditions, its directors and officers against
certain liabilities and expenses arising from claims against them because of
being such a director or officer. In addition, the Company has obtained
directors' and officers' liability insurance insuring, subject to certain
conditions, its directors and officers against similar such liabilities and
expenses.
Item 16. Exhibits
A list of Exhibits to this registration statement is set forth in the
Exhibit Index starting on page II-19 hereof.
Item 17. Undertakings
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;
(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;
II-1
<PAGE>
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of this
section do not apply if the registration statement is on Form S-3, Form S-
8 or Form F-3, and the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission 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.
(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.
(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.
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 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.
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
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 Act and
will be governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, 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 post-effective 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.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 New York, State of New York on May 6, 1998.
EMISPHERE TECHNOLOGIES, INC.
by /s/ Michael M. Goldberg
Michael M. Goldberg, M.D.
Chairman of the Board and Chief
Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Michael M. Goldberg, M.D. and Sam J. Milstein,
Ph.D., his or her true and lawful attorneys-in-fact and agents, each acting
alone, with full power of substitution and resubstitution, for him or her and
in his or her name, place and stead, in any and all capacities, to sign any and
all amendments to this Registration Statement, including post-effective
amendments, and to file the same, with all exhibits thereto, and all 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 do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as
he or she might or could do in person, and hereby ratifies and confirms all
that said attorneys-in-fact and agents, each acting alone, or their substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
/s/ Michael M. Goldberg Chairman of the Board and May 6, 1998
Michael M. Goldberg, M.D. Chief Executive Officer
/s/ Sam J. Milstein Director and President May 6, 1998
Sam J. Milstein, Ph.D
/s/ Howard M. Pack Director May 6, 1998
Howard M. Pack
Director May 6, 1998
Peter Barton Hutt
Director May 6, 1998
Jere E. Goyan, Ph.D.
/s/ Mark I. Greene Director May 6, 1998
Mark I. Greene, M.D., Ph.D.
Director May 6, 1998
Joseph R. Robinson, Ph.D.
/s/ Joseph D. Poveromo Controller (Principal Financial May 6, 1998
Joseph D. Poveromo and Accounting Officer)
II-3
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
5 Opinion of M. Warren Browne
23(a) Consent of Coopers & Lybrand L.L.P.
23(b) Consent of M. Warren Browne (included in Exhibit 5)
24 Power of Attorney (included in signature page)
II-4
<PAGE>
Exhibit 5
May 6, 1998
Emisphere Technologies, Inc.
15 Skyline Drive
Hawthorne, New York 10532
Dear Sirs:
Reference is made to the Registration Statement on Form S-3
(the "Registration Statement") to be filed with the Securities
and Exchange Commission under the Securities Act of 1933, as
amended (the "Act"), on behalf of Emisphere Technologies, Inc.
(the "Company"), relating to an aggregate of 1,202,500 shares of
the Company's Common Stock, par value $.01 per share (the
"Shares"), to be offered from time to time by the selling
shareholders designated in the Registration Statement.
As counsel to the Company, I have examined such corporate
records and other documents and have considered such questions of
law as I have deemed necessary or appropriate for the purposes of
this opinion and, upon the basis of such examination, advise you
that, in my opinion, the Shares will when sold be legally issued,
fully paid and non-assessable.
I hereby consent to the use of this opinion as Exhibit 5 to
the Registration Statement. This consent is not to be construed
as an admission that I am a person whose consent is required to
be filed with the Registration Statement under the provisions of
the Act.
Very truly yours,
M. Warren Browne
<PAGE>
Exhibit 23(a)
Consent of Independent Accountants
________________________
We consent to the incorporation by reference in this registration
statement of Emisphere Technologies, Inc. (the "Company") on Form S-3
of our report dated October 10, 1997, on our audits of the financial
statements and financial statement schedule of the Company as of July
31, 1997 and 1996, and for each of the three years in the period
ended July 31, 1997, which report is included in the Company's Annual
Report on Form 10-K for the year ended July 31, 1997. We also
consent to the reference to our Firm under the caption "Experts".
Coopers & Lybrand L.L.P.
New York, New York
May 6, 1998
