<PAGE>
As filed with the Securities and Exchange Commission on April 6, 2000
Registration No.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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HOLLIS-EDEN PHARMACEUTICALS, INC.
(Exact name of Registrant as specified in its charter)
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Delaware 13-3697002
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
9333 Genesee Avenue, Suite 200
San Diego, California 92121
(858) 587-9333
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
-----------------
Richard B. Hollis
Chairman of the Board and Chief Executive Officer
HOLLIS-EDEN PHARMACEUTICALS, INC.
9333 Genesee Avenue, Suite 200
San Diego, California 92121
(858) 587-9333
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
Eric J. Loumeau, Esq.
HOLLIS-EDEN PHARMACEUTICALS, INC.
9333 Genesee Avenue, Suite 200
San Diego, California 92121
(858) 587-9333
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Approximate date of commencement of proposed sale to the public:
From time to time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
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 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
<TABLE>
<CAPTION>
======================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Class of Amount to Offering Price Aggregate Registration
securities to be registered be registered Per Share(1) Offering Price(1) fee
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 38,000 $14.125 $536,750 $141.70
======================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the amount of the
registration fee pursuant to Rule 457(c) of the Securities Act of 1933. The
price per share and aggregate offering price are based upon the average of
the high and low sales price of Hollis-Eden's common stock on March 30,
2000 as reported on the Nasdaq National Market. It is not known how many
shares will be purchased under this registration statement or at what price
such shares will be purchased.
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>
PROSPECTUS
The information contained in this prospectus is not complete and may be
changed. These securities may not be sold to you until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
Subject to Completion, dated March , 2000
38,000 Shares
HOLLIS-EDEN PHARMACEUTICALS, INC.
Common Stock
_____________________
Selling stockholders identified in this prospectus are selling 38,000 shares of
Hollis-Eden Pharmaceuticals, Inc. common stock. Hollis-Eden will not receive
any of the proceeds from the sale of shares by the selling stockholders.
Hollis-Eden's common stock is listed on the Nasdaq National Market under the
symbol "HEPH." The closing sale price of the common stock, as reported on the
Nasdaq National Market on March , 2000, was $ per share.
Investing in the common stock involves a high degree of risk. See "Risk
Factors," beginning on page 3.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is __________, 2000.
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Table of Contents
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<TABLE>
<CAPTION>
Page
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<S> <C>
Hollis-Eden Pharmaceuticals................................. 3
Use of Proceeds............................................. 3
Risk Factors................................................ 3
Where You Can Get More Information.......................... 9
Forward-Looking Statements.................................. 9
Selling Stockholders........................................ 10
Plan of Distribution........................................ 10
Legal Matters............................................... 11
Experts..................................................... 11
</TABLE>
This prospectus is part of a registration statement we filed with the Securities
and Exchange Commission. You should rely only on the information contained in or
incorporated by reference in this prospectus. The SEC allows us to "incorporate
by reference" information that we file with them, which means that we can
disclose important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and information that we file later with the SEC will automatically
update and supersede this information.
2
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HOLLIS-EDEN PHARMACEUTICALS
Hollis-Eden is a pharmaceutical company in the development stage. We intend to
discover, develop and commercialize products for the treatment of a number of
targeted disease states caused by viral, bacterial, parasitic or fungal
infections, including HIV/AIDS, hepatitis, and malaria. We believe that certain
of our drug candidates may provide the first long-term treatment of HIV without
the development of viral strain resistance to the drugs' effectiveness,
significant toxicity or severe side effects.
Hollis-Eden's executive offices are located at 9333 Genesee Avenue, Suite 200,
San Diego, California 92121, telephone number (858) 587-9333.
USE OF PROCEEDS
Hollis-Eden will not receive any proceeds from the sale of the shares of common
stock offered by the selling stockholders.
RISK FACTORS
An investment in Hollis-Eden shares involves a high degree of risk. You should
consider the following discussion of risks, in addition to other information
contained in this prospectus. This prospectus also contains forward-looking
statements that involve risks and uncertainties.
If we do not obtain FDA regulatory approval for our products, we cannot sell our
products and we will not generate revenues.
Our principle development efforts are currently centered around HE2000, a drug
candidate which we believe shows promise for the treatment and prevention of
HIV/AIDS. However, all drug candidates require Food and Drug Administration,
FDA, and foreign government approvals before they can be commercialized. Neither
HE2000 nor any of our other drug candidates have been approved for commercial
sale. We expect to incur significant additional operating losses over the next
several years as we fund development, clinical testing and other expenses while
seeking regulatory approval. While limited clinical trials of HE2000 have to
date produced favorable results, significant additional trials are required, and
we may not be able to demonstrate that this drug candidate is safe or effective.
We cannot guarantee that any of our product candidates will obtain required
government approval. If we do not receive FDA or foreign approvals for our
products, we will not be able to sell our products and will not generate
revenues.
If we do not successfully commercialize our products, we may never achieve
profitability.
We have experienced significant operating losses to date because of the
substantial expenses we have incurred to acquire and fund development of our
drug candidates. We have never had operating revenues and have never
commercially introduced a product. Our accumulated deficit was $28.6 million
through December 31, 1999. Many of our research and development
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programs are at an early stage. Potential drug candidates are subject to
inherent risks of failure. These risks include the possibilities that no drug
candidate will be found safe or effective, meet applicable regulatory standards
or receive the necessary regulatory clearances. Even safe and effective drug
candidates may never be developed into commercially successful drugs. If we are
unable to develop safe, commercially viable drugs, we may never achieve
profitability.
As a result of our intensely competitive industry, we may not gain enough market
share to be profitable.
The biotechnology and pharmaceutical industries are intensely competitive. We
have numerous competitors in the United States and elsewhere. Our competitors
include major, multinational pharmaceutical and chemical companies, specialized
biotechnology firms and universities and other research institutions. Many of
these competitors have greater financial and other resources, larger research
and development staffs and more effective marketing and manufacturing
organizations than we do. In addition, academic and government institutions
have become increasingly aware of the commercial value of their research
findings. These institutions are now more likely to enter into exclusive
licensing agreements with commercial enterprises, including our competitors, to
market commercial products.
Our competitors may succeed in developing or licensing technologies and drugs
that are more effective or less costly than any we are developing. Our
competitors may succeed in obtaining FDA or other regulatory approvals for drug
candidates before we do. We cannot guarantee that our drug candidates, if
approved for sale, will be able to compete successfully with our competitors'
existing products under development. If we are unable to compete successfully,
we may never be able to sell enough products at a sufficient price that would
generate profits.
Our failure to protect our proprietary technology could impair our competitive
position.
We have developed and licensed numerous issued patents and pending applications
in the U.S. and foreign counterparts. Our success will depend in part on our
ability to obtain additional United States and foreign patent protection for our
drug candidates and processes, preserve our trade secrets and operate without
infringing the proprietary rights of third parties. We place considerable
importance on obtaining patent protection for significant new technologies,
products and processes. Legal standards relating to the validity of patents
covering pharmaceutical and biotechnology inventions and the scope of claims
made under such patents are still developing. Our patent position is highly
uncertain and involves complex legal and factual questions. We cannot be
certain that the applicant or inventors of subject matter covered by patent
applications or patents owned by or licensed to us were the first to invent or
the first to file patent applications for such inventions. We cannot guarantee
that any patents will issue from any of the pending or future patent
applications we own or have licensed. Existing or future patents owned by or
licensed to us may be challenged, infringed upon, invalidated, found to be
unenforceable or circumvented by others. Further, we cannot guarantee that any
rights we may have under any issued patents will provide us with sufficient
protection against competitive products or otherwise cover commercially valuable
products or processes.
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If another party claims the same subject matter or subject matter overlapping
with the subject matter that we have claimed in a United States patent
application or patent, we may decide or be required to participate in
interference proceedings in the United States Patent and Trademark Office in
order to determine the priority of invention. Loss of such an interference
proceeding would deprive us of patent protection sought or previously obtained
and could prevent us from commercializing our products. Participation in such
proceedings could result in substantial costs, whether or not the eventual
outcome is favorable. These additional costs could adversely affect our ability
to achieve profitability.
We will need to raise additional money before we expect to achieve
profitability; if we fail to raise additional money, it would be difficult to
continue our business.
As of December 31, 1999 our cash and cash equivalents totaled approximately $47
million. We believe these financial resources will fund our opportunities well
into 2001. Once these current financial resources run out, we will require
substantial additional funds in order to finance our drug discovery and
development programs, fund operating expenses, pursue regulatory clearances,
develop manufacturing, marketing and sales capabilities, and prosecute and
defend our intellectual property rights. We intend to seek additional funding
through public or private financing or through collaboration arrangements with
collaborative partners. If we can not raise additional funds when needed, we
may not be able to continue to develop our products, which would prevent us from
generating revenues.
If we raise additional money by issuing equity securities, your investment will
be diluted.
If we raise additional funding by issuing more equity securities, the new shares
will dilute the voting power of your investment on a percentage basis.
The technology in our sector is developing rapidly, and our future depends on
our ability to keep abreast of technological change.
Biotechnology and related pharmaceutical technology have undergone rapid and
significant change. We expect that the technologies associated with
biotechnology research and development will continue to develop rapidly. Our
future will depend in large part on our ability to maintain a competitive
position with respect to these technologies. Any compounds, products or
processes that we develop may become obsolete before we recover any expenses we
have incurred in connection with developing these products. If we fail to
recover our expenses because our products become obsolete, we may not be able to
achieve profitability.
If the manufacturers of our products do not comply with FDA regulations, or
cannot produce the amount of products we need to continue our development, we
will fall behind on our business objectives.
Outside manufacturers currently produce our drug candidates. Manufacturers
producing our products must follow current Good Manufacturing Practices
regulations enforced by the FDA through its facilities inspection program. If a
manufacturer of our products does not conform to
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the Good Manufacturing Practices regulations and cannot be brought up to such a
standard, we will be required to find alternative manufacturers that do conform.
This may be a long and difficult process, and may delay our ability to receive
FDA approval of our products.
We also rely on our manufacturers to supply us with a sufficient quantity of our
drug candidates to conduct clinical trials. If we have difficulty in the future
obtaining our required quantity and quality of supply, we could experience
significant delays in our development programs and regulatory process.
If we decide to manufacture our products ourselves, we face further FDA
regulation and will require additional capital.
At this time, we do not intend to manufacture any pharmaceutical products
ourselves. If we decide to manufacture products ourselves in the future, we
would be subject to the same risks associated with the regulatory requirements
described above. We would also require substantial additional capital. We have
no experience manufacturing pharmaceutical products for commercial purposes, so
we cannot guarantee that we would be able to manufacture any products
successfully or in a cost-effective manner.
Our ability to achieve any significant revenue will depend on our ability to
establish effective sales and marketing capabilities.
Our efforts to date have focused on the development and evaluation of our drug
candidates. As we continue clinical studies and prepare for commercialization of
our drug candidates, we need to build a sales and marketing infrastructure. We
have no experience in the sales and marketing of our drug candidates. If we
fail to establish a sufficient marketing and sales force, it will impair our
ability to enter new or existing markets. Our inability to effectively enter
these markets would materially and adversely affect our ability to generate
significant revenues.
If Hollis-Eden were to lose the services of Richard B. Hollis, or fail to
attract qualified personnel in the future, our business objectives would be more
difficult to implement, adversely affecting our operations.
Our ability to successfully implement our business strategy depends highly upon
our Chief Executive Officer, Richard B. Hollis. The loss of Mr. Hollis'
services could impede the achievement of our research and development
objectives. We also highly depend on our ability to hire and retain qualified
scientific and technical personnel. The competition for these employees is
intense. We cannot guarantee that we will continue to be able to hire and
retain the qualified personnel needed for our business. Loss of the services of
or the failure to recruit key scientific and technical personnel could adversely
affect our business, operating results and financial condition.
We may face product liability claims related to the use or misuse of our
products which may cause us to incur significant losses.
We face inherent business risk of product liability claims in the event that the
use or misuse of
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our products results in personal injury or death. We have not experienced any
such claims to date, but we cannot be certain, in particular after commercial
introduction of our products, that we will not experience losses due to product
liability claims. We currently maintain liability insurance on a claims-made
basis. We cannot be certain that the insurance policies' coverage limits are
adequate. The insurance is expensive, difficult to obtain and may not be
available in the future on acceptable terms, or at all. Any claims against us,
regardless of their merit, could substantially increase our costs and cause us
to incur significant losses.
Trading in our shares could be subject to extreme price fluctuations which could
adversely affect your investment.
The market prices for securities of life sciences companies, particularly those
that are not profitable, have been highly volatile, especially recently.
Publicized events and announcements may have a significant impact on the market
price of our common stock. For example, biological or medical discoveries by
competitors, unfavorable results from clinical trials, unfavorable developments
concerning patents or other proprietary rights or unfavorable domestic or
foreign regulatory developments may have the effect of temporarily or
permanently driving down the price of our common stock (example: Hollis-Eden's
stock price has ranged from $8.63 to $25.50 from January 1, 1999 to December 31,
1999.) In addition, the stock market from time to time experiences extreme
price and volume fluctuations which particularly affect the market prices for
emerging and life sciences companies, such as ours, and which are often
unrelated to the operating performance of the affected companies. These broad
market fluctuations may adversely affect the ability of a stockholder to dispose
of his shares at a price equal to or above the price at which the shares were
purchased.
Because stock ownership is concentrated, you and other investors will have
minimal influence on stockholders decisions.
Assuming that outstanding warrants and options have not been exercised, Richard
B. Hollis, our Chief Executive Officer, owns approximately 26% of our
outstanding common stock. Assuming the exercise of our outstanding warrants and
options, Mr. Hollis would own approximately 20% of our outstanding common stock.
As a result, Mr. Hollis may be able to significantly influence the management of
Hollis-Eden and all matters requiring stockholder approval, including the
election of directors. Such concentration of ownership may also have the effect
of delaying or preventing a change in control of Hollis-Eden.
We have implemented anti-takeover provisions, any of which may reduce the market
price of our common stock.
Provisions of our certificate of incorporation and bylaws could make it more
difficult for a third party to acquire us, even if the acquisition would be
beneficial to our stockholders.
Our board of directors is authorized, without any further vote by stockholders,
to issue shares of preferred stock. The issuance of preferred stock with
special voting, liquidation and dividend privileges may have the effect of
delaying, deferring or preventing a change in control without any further action
by the stockholders. Any such issuance may materially and adversely affect
7
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the price of the common stock.
Our board of directors is a "classified board," with approximately one-third of
our directors elected each year. Two annual meetings would be necessary to
change a majority of the directors as a result of having a classified board.
The existence of a classified board may, in certain circumstances, deter or
delay mergers, tender offers, other possible takeover attempts or changes in
management of the board of directors which may be favored by some or a majority
of our stockholders.
We have distributed a dividend of one right for each outstanding share of common
stock pursuant to the terms of our stockholder rights plan. These rights will
cause substantial dilution to the ownership of a person or group that attempts
to acquire us on terms not approved by our board of directors and may have the
effect of deterring hostile takeover attempts.
If we fail to adequately address Year 2000 problems, our business and financial
condition could experience losses.
Many currently installed computer systems and software products are coded to
accept only two-digit entries in the date code field. Beginning in the year
2000, these date code fields needed to accept four-digit entries to distinguish
the 21/st/ century dates from 20/th/ century dates. The effects of the Year 2000
issue may be experienced after January 1, 2000, and if not addressed, the impact
on operations may affect an entity's ability to conduct normal business
operations. Three months into the year 2000, we have not identified any Year
2000 problems internally and we have not experienced problems with our suppliers
relating to Year 2000 issues. However, it is possible that such problems may
occur or be discovered later. Accordingly, it is not possible to be certain
that all aspects of the Year 2000 issue affecting Hollis-Eden, including those
relating to our suppliers or other third parties, are fully resolved. Should
any adverse consequences occur, it could affect our drug development process and
clinical trials. We may also incur certain unexpected costs in connection with
the Year 2000 issue.
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WHERE YOU CAN GET MORE INFORMATION
We are a reporting company and file annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy these
reports, proxy statements and other information at the SEC's public reference
rooms in Washington, D.C., New York, NY and Chicago, IL. You can request copies
of these documents by writing to the SEC and paying a fee for the copying cost.
Please call the SEC at 1-800-SEC-0330 for more information about the operation
of the public reference rooms. Our SEC filings are also available at the SEC's
Web site at "http://www.sec.gov".
We incorporate by reference the documents listed below, except as modified by
this registration statement, and any future filings we will make with the SEC
under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934:
. Annual Report on Form 10-K for the year ended December 31, 1999;
. Notice of Annual Meeting and Proxy Statement for the 1999 Annual Meeting of
Stockholders:
. Current Report on form 8-K filed February 4, 2000; and
. Hollis-Eden's registration statement on Form S-4, No. 333-18725, as
amended, which includes a description of Hollis-Eden's common stock.
You may request a copy of these filings at no cost, by writing or telephoning us
at the following address or telephone number:
Hollis-Eden Pharmaceuticals, Inc.
9333 Genesee Avenue, Suite 200
San Diego, CA 92121
Attn: Vice President-Controller
(858) 587-9333
FORWARD-LOOKING STATEMENTS
Except for historical information, the information contained in this prospectus
and in our SEC reports are "forward looking" statements about our expected
future business and performance. Our actual operating results and financial
performance may prove to be very different from what we might have predicted as
of the date of this prospectus. The risks described above address some of the
factors that may affect our future operating results and financial performance.
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SELLING STOCKHOLDERS
The following table sets forth the names of the selling stockholders, and the
number of shares of common stock owned beneficially by them as of March , 2000
which may be offered under the terms of this prospectus. This information is
based upon information provided by each selling stockholder. Each selling
stockholder is offering all of the shares they beneficially own, and assuming
they sell every share, will not beneficially own any shares of Hollis-Eden.
<TABLE>
<CAPTION>
Shares Being
Name Offered
<S> <C>
Humanetics Corporation.................................. 38,000
</TABLE>
The selling stockholder has not, or within the past three years has not had, any
position, office or other material relationship with Hollis-Eden or any of its
predecessors or affiliates.
PLAN OF DISTRIBUTION
The shares of common stock may be sold from time to time by the selling
stockholders in one or more transactions at fixed prices, at market prices at
the time of sale, at varying prices determined at the time of sale or at
negotiated prices. The selling stockholders may offer their shares of common
stock in one or more of the following transactions:
- - on any national securities exchange or quotation service at which the
common stock may be listed or quoted at the time of sale, including the
Nasdaq National Market.
- - in the over-the-counter market,
- - in private transactions,
- - through options,
- - by pledge to secure debts and other obligations, or a combination of any of
the above transactions.
If required, we will distribute a supplement to this prospectus to describe
material changes in the terms of the offering.
The shares of common stock described in this prospectus may be sold from time to
time directly by the selling stockholders. Alternatively, the selling
stockholders may from time to time offer shares of common stock to or through
underwriters, broker/dealers or agents. The selling stockholders and any
underwriters, broker/dealers or agents that participate in the distribution of
the shares of common stock may be deemed to be "underwriters" within the meaning
of the
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Securities Act of 1933. Any profits on the resale of shares of common stock and
any compensation received by any underwriter, broker/dealer or agent may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933.
Any shares covered by this prospectus which qualify for sale pursuant to Rule
144 under the Securities Act of 1933 may be sold under rule 144 rather than
under the terms of this prospectus. The selling stockholders may not sell all
of the shares. The selling stockholders may transfer, will or gift such shares
by other means not described in this prospectus.
To comply with the securities laws of certain jurisdictions, the common stock
must be offered or sold only through registered or licensed brokers or dealers.
In addition, in certain jurisdictions, the common stock may not be offered or
sold unless they have been registered or qualified for sale or an exemption is
available and complied with.
Under the Securities Exchange Act of 1934, any person engaged in a distribution
of the common stock may not simultaneously engage in market-making activities
with respect to the common stock for nine business days prior to the start of
the distribution. In addition, each selling stockholder and any other person
participating in a distribution will be subject to the Securities Exchange Act
of 1934 which may limit the timing of purchases and sales of common stock by the
selling stockholders or any such other person. These factors may affect the
marketability of the common stock and the ability of brokers or dealers to
engage in market-making activities.
All expenses of this registration will be paid by Hollis-Eden. These expenses
include the SEC's filing fees and fees under state securities or "blue sky"
laws. We estimate that our expenses in connection with this offering will be
approximately $4,142. All expenses for the issuance of a supplement to this
prospectus, when requested by selling stockholder(s), will be paid by the
requesting stockholder(s).
LEGAL MATTERS
Cooley Godward LLP will give its opinion that the shares offered in this
prospectus have been validly issued and are fully paid and non-assessable, and
that the shares which will be issued upon the exercise of certain warrants will
be validly issued, fully paid and nonassessable.
EXPERTS
The financial statements of the registrant as of December 31, 1999 and 1998, and
for each of the years ended December 31, 1999, 1998 and 1997, and for the period
August 15, 1994, the day we started doing business, to December 31, 1999, have
been audited by BDO Seidman, LLP, as set forth in their report included in
Hollis-Eden's Annual Report on Form 10-K for the year ended December 31, 1999.
We incorporate these financial statements by reference into this prospectus in
reliance upon such report given upon the authority of BDO Seidman, LLP as
experts in accounting and auditing.
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We have not authorized any dealer, salesperson or other person to give any
information or to make any representations not contained in this prospectus or
any prospectus supplement. You must not rely on any unauthorized information.
This prospectus is not an offer of these securities in any state where an offer
is not permitted. The information in this prospectus is current as of ,
2000. You should not assume that this prospectus is accurate as of any other
date.
38,000 Shares
HOLLIS-EDEN PHARMACEUTICALS, INC.
Common Stock
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses in connection with the issuance and distribution of the
securities being registered are set forth in the following table (all amounts
except the registration fee and the listing fee are estimated):
<TABLE>
<CAPTION>
<S> <C>
SEC Registration Fee.............................. $ 142
Legal fees and expenses........................... $2,000
Accounting fees and expenses...................... $2,000
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Total........................................ $4,142
</TABLE>
Item 15. Indemnification of Officers and Directors.
Under Section 145 of the Delaware General Corporation Law, the registrant
has broad powers to indemnify its directors and officers against liabilities
they may incur in such capacities, including liabilities under the Securities
Act of 1933, as amended (the "Securities Act").
The registrant's bylaws provide that the registrant shall indemnify its
directors and executive officers and may indemnify its other officers, employees
and other agents to the fullest extent permitted by Delaware law. The registrant
is also empowered under its bylaws to enter into indemnification contracts with
its directors and officers and to purchase insurance on behalf of any person
whom it is required or permitted to indemnify. In addition, the registrant is
required, subject to certain exceptions, to advance all expenses incurred by any
director or executive officer in connection with a completed, pending or
threatened action, suit or proceeding upon receipt of an undertaking by such
director or executive officer to repay all amounts advanced by the registrant on
such person's behalf if it is ultimately determined that such person is not
entitled to be indemnified under the bylaws or otherwise.
The registrant's Certificate of Incorporation provides that to the fullest
extent permitted under Delaware law, the registrant's directors will not be
personally liable to the registrant and its stockholders for monetary damages
for any breach of a director's fiduciary duty. The Certificate of Incorporation
does not, however, eliminate the duty of care, and in appropriate circumstances,
equitable remedies such as an injunction or other forms of non-monetary relief
would remain available under Delaware law. Each director is subject to liability
for breach of the director's duty of loyalty to the registrant, for acts or
omissions not in good faith or involving intentional misconduct or knowing
violations of law, for any transaction from which the director derived an
improper personal benefit and
II-1
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for improper distributions to stockholders and loans to directors and officers.
This provision does not affect a director's responsibilities under any other
laws, such as the federal securities laws or state or federal environmental
laws.
The registrant maintains directors' and officers' liability insurance.
Item 16. Exhibits.
(a) Exhibits.
Exhibit No. Description
----------- -----------
5.1 Opinion of Cooley Godward llp.
23.1 Consent of BDO Seidman, llp.
23.2 Consent of Cooley Godward llp. Reference is made to Exhibit
5.1.
24.1 Power of Attorney. Reference is made to page II-4.
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the registrant
pursuant to the provisions described in Item 15, the registrant has been
informed 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 person controlling the registrant in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or person controlling the registrant 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 of 1933 and will be
governed by the final adjudication of such issue.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made pursuant to this registration statement, a post-effective amendment to
this registration statement 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-2
<PAGE>
(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; and
(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 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 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-3
<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 San Diego, State of California, on April 3, 2000.
Hollis-Eden Pharmaceuticals, Inc.
/s/ Richard B. Hollis
------------------------------------
Richard B. Hollis
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Richard B. Hollis, Daniel D. Burgess and
Robert W. Weber, and each of them, his true and lawful attorney-in-fact and
agent, 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 post-effective 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, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or any of them, or his substitutes or substitute, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ Richard B Hollis Chairman of the Board, Chief April 3, 2000
- ---------------------- Executive Officer and Director
Richard B. Hollis (Principal Executive Officer)
/s/ Daniel D. Burgess Chief Operating Officer/ April 4, 2000
- ---------------------- Chief Financial Officer
Daniel D. Burgess (Principal Financial Officer)
/s/ Robert W. Weber Vice President-Controller/ April 3, 2000
- ---------------------- Chief Accounting Officer
Robert W. Weber (Principal Accounting Officer)
/s/ J. Paul Bagley III Director March 28, 2000
- ----------------------
J. Paul Bagley III
II-4
<PAGE>
Signature Title Date
--------- ----- ----
/s/ Leonard Makowka Director March 30, 2000
- -----------------------------
Leonard Makowka
/s/ Brendan R. McDonnell Director March 30, 2000
- ---------------------------------
Brendan R. McDonnell
/s/ Thomas Charles Merigan Jr. MD Chairman of the Scientific April 3, 2000
- --------------------------------- Advisory Board and Director
Thomas Charles Merigan, Jr. MD
/s/ William H. Tilley Director March 28, 2000
- ---------------------------------
William H. Tilley
/s/ Salvatore J. Zizza Director April 3, 2000
- ---------------------------------
Salvatore J. Zizza
II-5
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ---------- -----------
5.1 Opinion of Cooley Godward LLP.
23.1 Consent of BDO Seidman, LLP.
23.2 Consent of Cooley Godward LLP. Reference is made to Exhibit 5.1.
24.1 Power of Attorney. Reference is made to Page II-4.
_________________
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF COOLEY GODWARD LLP]
April 6, 2000
Hollis-Eden Pharmaceuticals, Inc.
9333 Genesee Avenue, Suite 200
San Diego, CA 92121
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by Hollis-Eden Pharmaceuticals, Inc. (the "Company") of a
Form S-3 Registration Statement (the "Registration Statement"), including a
related prospectus filed with the Registration Statement (the "Prospectus"),
covering the registration of up to 38,000 shares of the Company's Common Stock,
$.01 par value, that may be sold by a certain selling stockholder (the
"Shares").
In connection with this opinion, we have examined the Registration Statement and
related Prospectus, your Certificate of Incorporation and Bylaws, as amended,
and such other documents, records, certificates, memoranda and other instruments
as we deem necessary as a basis for this opinion. We have assumed the
genuineness and authenticity of all documents submitted to us as originals, the
conformity to originals of all documents submitted to us as copies thereof and
the due execution and delivery of all documents where due execution and delivery
are a prerequisite to the effectiveness thereof.
On the basis of the foregoing, and in reliance thereon, we are of the opinion
that the Shares are validly issued, fully paid and nonassessable.
We consent to the reference to our firm under the caption "Legal Matters" in the
Prospectus included in the Registration Statement and to the filing of this
opinion as an exhibit to the Registration Statement.
Very truly yours,
Cooley Godward LLP
Thomas A. Coll
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Hollis-Eden Pharmaceuticals, Inc.
San Diego, California
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of the Registration Statement on Form S-3 of our report
dated January 21, 2000, relating to the financial statements of Hollis-Eden
Pharmaceuticals, Inc. appearing in the Company's Annual Report on Form 10-K for
the year ended December 31, 1999.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
BDO Seidman, LLP
New York, New York
April 3, 2000
