SCHEDULE 13D/A
(Rule 13d-101)
Information to be Included in Statements Filed Pursuant to Rule 13d-1(a) and
Amendments Thereto Filed Pursuant to Rule 13d-2(a)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Under the Securities Exchange Act of 1934
(Amendment No. 2)*
HYBRIDON, INC.
(Name of Issuer)
COMMON STOCK
(Title of Class of Securities)
44860M108
(CUSIP Number)
Youssef El-Zein
142 Al Moutrane Street, 5th Floor
Beirut Central District
Beirut 2012-7106 Lebanon
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
May 24, 2005
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box. / /
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7(b) for other
parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 14 Pages)
-------------------------
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
13D
CUSIP NO. 44860M108 Page 2 of 14 Pages
-------------------- -------------------
1 NAMES OF REPORTING PERSONS/I.R.S. IDENTIFICATION NOS. OF ABOVE
PERSONS (ENTITIES ONLY)
Youssef El-Zein
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC, OO
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
France
7 SOLE VOTING POWER
NUMBER OF
SHARES 1,879,335
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 12,797,925
PERSON
WITH 9 SOLE DISPOSITIVE POWER
1,879,335
10 SHARED DISPOSITIVE POWER
12,797,925
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
14,677,260
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES / /
Not applicable
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
12.4%
14 TYPE OF REPORTING PERSON
IN
13D
CUSIP NO. 44860M108 Page 3 of 14 Pages
-------------------- -------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Pillar Investment Limited
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC, OO
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Isle of Man
7 SOLE VOTING POWER
NUMBER OF
SHARES 1,585,707
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 11,212,218
PERSON
WITH 9 SOLE DISPOSITIVE POWER
1,585,707
10 SHARED DISPOSITIVE POWER
11,212,218
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
12,797,925
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES / /
Not applicable
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.8%
14 TYPE OF REPORTING PERSON
OO
13D
CUSIP NO. 44860M108 Page 4 of 14 Pages
-------------------- -------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Optima Life Sciences Limited
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
3 SEC USE ONLY
4 SOURCE OF FUNDS
WC
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) OR 2(e) / /
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Isle of Man
7 SOLE VOTING POWER
NUMBER OF
SHARES 11,212,218
BENEFICIALLY
OWNED BY 8 SHARED VOTING POWER
EACH
REPORTING 0
PERSON
WITH 9 SOLE DISPOSITIVE POWER
11,212,218
10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,212,218
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES / /
Not applicable
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.6%
14 TYPE OF REPORTING PERSON
OO
SCHEDULE 13D
CUSIP NO. 44860M108 Page 5 of 14 Pages
-------------------- -------------------
This Amendment No. 2 ("Amendment") to the original Schedule 13D filed
September 8, 2003, is being filed on behalf of Youssef El-Zein, Pillar
Investment Limited, a limited company incorporated under the laws of the Isle of
Man ("Pillar") and Optima Life Sciences Limited, a limited company incorporated
under the laws of the Isle of Man ("Optima" and, together with Youssef El-Zein
and Pillar, the "Reporting Parties"). Mr. El-Zein is a director of Pillar and of
Optima. Pillar is the manager and investment advisor of Optima and holds all of
the voting shares of Optima.
Item 1. Security and Issuer.
This Amendment relates to the Common Stock, $0.001 par value per share
(the "Common Stock"), of Hybridon, Inc., a Delaware corporation (the "Company").
The address of the principal executive office of the Company is 345 Vassar
Street, Cambridge, Massachusetts 02139-4818.
Item 2. Identity and Background.
(a) This statement is being filed by the Reporting Parties:
Youssef El-Zein, Pillar and Optima.
(b) The business address of Mr. El-Zein is 142 Al Moutrane Street,
5th Floor, Beirut Central District, Beirut 2012-7106 Lebanon.
(c) Mr. El-Zein's principal occupation is serving as a director of
Pillar.
The principal business of Pillar is providing managerial
investment advisory services to Optima. The address of Pillar
is St. James's Chambers, 64A Athol Street, Isle of Man IM1
1JE.
The principal business of Optima is investing in and holding
securities of the Company. The address of Optima is St.
James's Chambers, 64A Athol Street, Isle of Man IM1 1JE.
(d) None of the Reporting Parties and, to the knowledge of the
Reporting Parties, none of the Listed Directors (as defined
below), has, during the last five years, been convicted in a
criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) None of the Reporting Parties and, to the knowledge of the
Reporting Parties, none of the Listed Directors, has, during
the last five years, been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and
as a
SCHEDULE 13D
CUSIP NO. 44860M108 Page 6 of 14 Pages
-------------------- -------------------
result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to
such laws.
(f) Mr. El-Zein is a citizen of France. Pillar and Optima were
organized under the laws of the Isle of Man.
In accordance with the provisions of General Instruction C to Schedule
13D, information required by Item 2 of Schedule 13D with respect to the
directors of Pillar and Optima is listed on Schedule 1 hereto and is
incorporated by reference herein. Pillar and Optima have no executive officers.
Mr. Bilal Sidani serves with Mr. El-Zein as a director of Pillar, and Mr. Sidani
and Mr. David Burge serve with Mr. El-Zein as directors of Optima. Messrs.
Sidani and Burge are referred to herein as the "Listed Directors."
Item 3. Source and Amount of Funds or Other Consideration.
On August 28, 2003, Optima purchased 5,500,381 shares of Common Stock
and warrants to purchase 1,650,114 shares of Common Stock (the "2003 Optima
Warrants") for a total purchase price of $4,015,278.38 in a private financing
consummated by the Company on August 28, 2003 and August 29, 2003 (collectively,
the "2003 Private Financing"). The 2003 Optima Warrants have an exercise price
of $1.00 per share of Common Stock and are exercisable on or prior to August 28,
2008. Optima purchased these securities pursuant to a Subscription Agreement,
dated as of August 28, 2003, between the Company and Optima (the "2003
Subscription Agreement"). Optima used its working capital to purchase these
securities. The Company also issued warrants to purchase 587,709 shares of
Common Stock to Pillar on August 28, 2003 (the "2003 Pillar Warrants"). The 2003
Pillar Warrants have an exercise price of $1.00 per share of Common Stock and
are exercisable on or prior to August 28, 2008. The 2003 Pillar Warrants were
issued to Pillar as part of Pillar's placement agent fees in connection with the
participation of certain non-U.S. investors in the 2003 Private Financing,
including Optima, pursuant to an engagement letter dated as of April 18, 2003
(the "2003 Engagement Letter"), by and among the Company, Pillar and PrimeCorp
Finance S.A.
On August 27, 2004, Optima purchased 2,768,100 shares of Common Stock
and warrants to purchase 553,620 shares of Common Stock (the "2004 Optima
Warrants" and together with the 2003 Optima Warrants, the "Optima Warrants") for
a total purchase price of $1,600,000 in a private financing consummated by the
Company on August 27, 2004 (the "2004 Private Financing"). The amount paid was
based on a market price for the Common Stock of $.553 per share. The 2004 Optima
Warrants have an exercise price of $0.67 per share of Common Stock and are
exercisable on or prior to August 27, 2009. Optima purchased these securities
pursuant to a Subscription Agreement, dated as of August 27, 2004, between the
Company and Optima (the "2004 Subscription Agreement"). Optima used its working
capital to purchase these
SCHEDULE 13D
CUSIP NO. 44860M108 Page 7 of 14 Pages
-------------------- -------------------
securities. In connection with the 2004 Private Financing, the Company issued
warrants to purchase 432,520 shares of Common Stock to Pillar on August 27, 2004
(the "2004 Pillar Warrants"). The 2004 Pillar Warrants have an exercise price of
$0.67 per share of Common Stock and are exercisable on or prior to August 27,
2009. The 2004 Pillar Warrants were issued to Pillar as part of Pillar's
placement agent fees in connection with the participation of certain non-U.S.
investors in the 2004 Private Financing, including Optima, pursuant to an
engagement letter dated as of August 27, 2004 (the "2004 Engagement Letter"), by
and between the Company and Pillar.
In October 2004, Optima distributed 2,746,233 shares of the Common
Stock that it acquired in the 2003 Private Financing to certain of its investors
for no consideration. After this distribution, Optima owned 5,522,248 shares of
Common Stock.
This Amendment relates to the purchase on May 24, 2005 by Optima of a
4% convertible subordinated note due April 30, 2008 in the principal amount of
$3,102,750 (the "Optima Note") in a private financing consummated by the Company
on May 24, 2005 (the "2005 Private Financing"). The Optima Note has a conversion
price of $0.89 per share of Common Stock (convertible into 3,486,236 shares of
Common Stock as of the date hereof) and the principal amount of the Optima Note
(or any portion thereof) is convertible at any time prior to April 30, 2008.
Optima purchased the Optima Note pursuant to (i) a Subscription Agreement, dated
as of May 20, 2005, between the Company and Optima (the "2005 Subscription
Agreement"), and (ii) a Noteholders Agreement, dated as of May 20, 2005, between
the Company and the investors in the 2005 Private Financing, including Optima
(the "Noteholders Agreement"). Optima used funds raised from outside investors
to purchase the Optima Note. In connection with the 2005 Private Financing, the
Company issued warrants to purchase 565,478 shares of Common Stock to Pillar on
May 24, 2005 (the "2005 Pillar Warrants" and together with the 2003 Pillar
Warrants and the 2004 Pillar Warrants, the "Pillar Warrants"). The 2005 Pillar
Warrants have an exercise price of $0.89 per share of Common Stock and are
exercisable on or prior to May 24, 2010. The 2005 Pillar Warrants were issued to
Pillar as part of Pillar's placement agent fees in connection with the
participation of certain non-U.S. investors in the 2005 Private Financing,
including Optima, pursuant to an engagement letter dated as of May 20, 2005 (the
"2005 Engagement Letter"), by and between the Company and Pillar.
Prior to the transactions on May 24, 2005, Mr. El-Zein beneficially
owned 1,879,335 shares of Common Stock. These shares include 51,500 shares of
Common Stock issuable upon exercise of stock options granted to Mr. El-Zein as a
director of the Company and currently exercisable (or exercisable within 60 days
after this amendment) and 1,827,835 shares of Common Stock held by Mr. El-Zein
directly. Mr. El-Zein acquired these securities primarily from certain
stockholders of the Company and from distributions from Pillar and certain
affiliates of Pillar. The securities distributed by Pillar and its affiliates to
Mr. El-Zein include securities
SCHEDULE 13D
CUSIP NO. 44860M108 Page 8 of 14 Pages
-------------------- -------------------
issued to Pillar and its affiliates as payment for consulting advisory services,
including fees in connection with the Company's financings in 1998, 1999 and
2000.
Item 4. Purpose of the Transaction.
The acquisition by Optima of the Optima Note, which is convertible to
shares of Common Stock beneficially owned by the Reporting Parties, was effected
because of the Reporting Parties' belief that the Optima Note represents an
attractive investment. Pillar also accepted the 2005 Pillar Warrants as payment
for consulting advisory services because of the Reporting Parties' belief that
the 2005 Pillar Warrants represent an attractive investment. The Reporting
Parties may from time to time acquire additional shares of Common Stock,
warrants or convertible notes or engage in discussions with the Company
concerning further acquisitions of shares of Common Stock, warrants or
convertible notes, or further investments in the Company.
In particular, as a director of the Company, Mr. El-Zein is entitled to
receive stock options pursuant to the Company's director stock option plan. In
addition, Pillar may acquire additional warrants from the Company under the
terms of the 2005 Engagement Letter if the Company conducts additional closings
under the 2005 Private Financing with investors identified by Pillar.
The Reporting Parties intend to review their investments in the Company
on a continuing basis and, depending upon the price and availability of shares
of Common Stock, subsequent developments affecting the Company, the Company's
business and prospects, other investment and business opportunities available to
the Reporting Parties, general stock market and economic conditions, tax
considerations and other factors considered relevant, may decide at any time to
increase, or to decrease, the size of their investments in the Company.
Except as set forth above in this Amendment, none of the Reporting
Parties and, to the knowledge of the Reporting Parties, none of the Listed
Directors, has any current plans or proposals that relate to or would result in:
(a) the acquisition by any person of additional securities of the Company, or
the disposition of securities of the Company; (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation, involving the
Company or any of its subsidiaries; (c) a sale or transfer of a material amount
of assets of the Company or any of its subsidiaries; (d) any change in the
present Board of Directors or management of the Company, including any plans or
proposals to change the number or term of directors or to fill any existing
vacancies on the board; (e) any material change in the present capitalization or
dividend policy of the Company; (f) any other material change in the Company's
business or corporate structure; (g) changes in the Company's charter, by-laws
or instruments corresponding thereto or other actions which may impede the
acquisition of control of the Company by any person; (h) causing a class of
securities of the Company to be delisted from a national securities exchange or
to cease to be authorized to be quoted in an inter-dealer quotation system of a
SCHEDULE 13D
CUSIP NO. 44860M108 Page 9 of 14 Pages
-------------------- -------------------
registered national securities association; (i) a class of equity securities of
the Company becoming eligible for termination of registration pursuant to
Section 12(g)(4) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"); or (j) any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) Youssef El-Zein beneficially owns 14,677,260 shares of Common
Stock. These shares represent approximately 12.4% of the
Common Stock outstanding. These shares include (i) 1,827,835
shares of Common Stock held directly by Mr. El-Zein, (ii)
51,500 shares of Common Stock which Mr. El-Zein has the right
to acquire upon the exercise of stock options during the
60-day period commencing May 24, 2005, (iii) 1,585,707 shares
of Common Stock issuable upon exercise of the Pillar Warrants,
(iv) 5,522,248 shares of Common Stock held by Optima, (v)
2,203,734 shares of Common Stock issuable upon exercise of the
Optima Warrants and (vi) 3,486,236 shares of Common Stock
issuable upon conversion of the Optima Note. Because of his
relationship with Pillar and Optima, Mr. El-Zein may be deemed
to beneficially own all of the shares of Common Stock that
Pillar and Optima beneficially own.
Pillar beneficially owns 12,797,925 shares of Common Stock.
These shares represent approximately 10.8% of the Common Stock
outstanding. These shares include (i) 1,585,707 shares of
Common Stock issuable upon exercise of the Pillar Warrants,
(ii) 5,522,248 shares of Common Stock held by Optima, (iii)
2,203,734 shares of Common Stock issuable upon exercise of the
Optima Warrants and (iv) 3,486,236 shares of Common Stock
issuable upon conversion of the Optima Note. As the holder of
all of the voting shares of Optima, Pillar has the ability to
elect and remove the directors of Optima, and, as a result,
may be deemed to beneficially own all of the shares of Common
Stock that Optima beneficially owns.
Optima beneficially owns 11,212,218 shares of Common Stock.
These shares represent approximately 9.6% of the Common Stock
outstanding. These shares include (i) 5,522,248 shares of
Common Stock held by Optima, (ii) 2,203,734 shares of Common
Stock issuable upon exercise of the Optima Warrants and (iii)
3,486,236 shares of Common Stock issuable upon conversion of
the Optima Note.
Neither of the Listed Directors owns any shares of Common
Stock.
(b) Number of shares as to which each of the Reporting Parties
has:
SCHEDULE 13D
CUSIP NO. 44860M108 Page 10 of 14 Pages
-------------------- -------------------
Sole power to vote or to direct the vote of shares of Common
Stock:
Mr. El-Zein: 1,879,335
Pillar: 1,585,707
Optima: 11,212,218
Shared power to vote or to direct the vote of shares of Common
Stock:
Mr. El-Zein: 12,797,925
Pillar: 11,212,218
Optima: 0
Sole power to dispose of or direct the disposition of shares
of Common Stock:
Mr. El-Zein: 1,879,335
Pillar: 1,585,707
Optima: 11,212,218
Shared power to dispose or to direct the disposition of shares
of Common Stock:
Mr. El-Zein: 12,797,925
Pillar: 11,212,218
Optima: 0
(c) Except as described below, none of the Reporting Parties and,
to the knowledge of the Reporting Parties, none of the Listed
Directors has effected any transactions in the Common Stock
during the past 60 days:
(i) Optima purchased the Optima Note in the principal
amount of $3,102,750 in the 2005 Private Financing on
May 24, 2005. The description of this transaction is
included in the fourth paragraph of Item 3 of this
Amendment and is incorporated herein by reference.
(ii) Pillar acquired warrants to purchase 565,478 shares
of Common Stock on May 24, 2005. The description of
this transaction is included in the fourth paragraph
of Item 3 of this Amendment and is incorporated
herein by reference.
(d) The Reporting Parties do not know of any other person who has
the right to receive or the power to direct the receipt of
dividends from, or the proceeds from
SCHEDULE 13D
CUSIP NO. 44860M108 Page 11 of 14 Pages
-------------------- -------------------
the sale of, the shares of Common Stock reported in this
Amendment as beneficially owned by the Reporting Parties.
(e) N/A
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer.
The Reporting Parties and the Listed Directors are parties to the
following contracts, arrangements, understandings or relationships (legal or
otherwise) with respect to any securities of the Company:
(a) Pursuant to Rule 13d-1(k) promulgated under the Exchange Act,
the Reporting Parties have entered into an agreement, attached
hereto, with respect to the joint filing of this Amendment.
This joint filing agreement is incorporated by reference to
Exhibit 99.1 hereto.
(b) The 2003 Optima Warrant to purchase 1,650,114 shares of Common
Stock issued to Optima on August 28, 2003 pursuant to the 2003
Subscription Agreement is described in the first paragraph of
Item 3 of this Amendment, which description is incorporated
herein by reference. The summary of the 2003 Optima Warrant in
this Amendment is qualified in its entirety by reference to
the 2003 Optima Warrant, which is incorporated by reference to
Exhibit 99.2 hereto.
(c) The 2003 Pillar Warrant to purchase 587,709 shares of Common
Stock issued to Pillar on August 28, 2003 pursuant to the 2003
Engagement Letter is described in the first paragraph of Item
3 of this Amendment, which description is incorporated herein
by reference. The summary of the 2003 Pillar Warrant in this
Amendment is qualified in its entirety by reference to the
2003 Pillar Warrant, which is incorporated by reference to
Exhibit 99.3 hereto.
(d) The 2004 Optima Warrant to purchase 553,620 shares of Common
Stock issued to Optima on August 27, 2004 pursuant to the 2004
Subscription Agreement is described in the second paragraph of
Item 3 of this Amendment, which description is incorporated
herein by reference. The summary of the 2004 Optima Warrant in
this Amendment is qualified in its entirety by reference to
the 2004 Optima Warrant, which is attached as Exhibit 99.4
hereto.
(e) The 2004 Pillar Warrant to purchase 432,520 shares of Common
Stock issued to Pillar on August 27, 2004 pursuant to the 2004
Engagement Letter is described in the second paragraph of Item
3 of this Amendment, which description is
SCHEDULE 13D
CUSIP NO. 44860M108 Page 12 of 14 Pages
-------------------- -------------------
incorporated herein by reference. The summary of the 2004
Pillar Warrant in this Amendment is qualified in its entirety
by reference to the 2004 Pillar Warrant, which is attached as
Exhibit 99.5 hereto.
(f) In connection with its purchase of the Optima Note, Optima
entered into the 2005 Subscription Agreement and the
Noteholders Agreement. The 2005 Subscription Agreement
provides for the purchase by Optima, and the sale by the
Company, of the Optima Note. The Noteholders Agreement
provides for the purchase by the investors in the 2005 Private
Financing, including Optima, and the sale by the Company, of
the 4% convertible subordinated notes due April 30, 2008 in
the 2005 Private Financing. These transactions are described
in the fourth paragraph of Item 3 of this Amendment, which
description is incorporated herein by reference. The summaries
of the 2005 Subscription Agreement and the Noteholders
Agreement in this Amendment are qualified in their entirety by
reference to the 2005 Subscription Agreement and to the
Noteholders Agreement, which are attached as Exhibit 99.6 and
Exhibit 99.7 hereto, respectively.
(g) The Optima Note in the principal amount of $3,102,750 made by
the Company to the order of Optima on May 24, 2005 pursuant to
the 2005 Subscription Agreement and the Noteholders Agreement
is described in the fourth paragraph of Item 3 of this
Amendment, which description is incorporated herein by
reference. The summary of the Optima Note in this Amendment is
qualified in its entirety by reference to the Optima Note,
which is attached as Exhibit 99.8 hereto.
(h) Pursuant to the 2005 Engagement Letter referenced in Item 3 of
this Amendment, the Company engaged Pillar as a non-exclusive
financial advisor to the Company in connection with the
private placement of securities of the Company outside the
United States. In consideration for these services, the
Company agreed to pay Pillar cash fees and warrants to
purchase shares of Common Stock as placement fees. The 2005
Engagement Letter may be terminated at any time upon written
notice by the Company or by Pillar. The summary of the 2005
Engagement Letter in this Amendment is qualified in its
entirety by reference to the 2005 Engagement Letter, which is
attached as Exhibit 99.9 hereto.
(i) The 2005 Pillar Warrant to purchase 565,478 shares of Common
Stock issued to Pillar on May 24, 2005 pursuant to the 2005
Engagement Letter is described in the fourth paragraph of Item
3 of this Amendment, which description is incorporated herein
by reference. The summary of the 2005 Pillar Warrant in this
Amendment is qualified in its entirety by reference to the
2005 Pillar Warrant, which is attached as Exhibit 99.10
hereto.
SCHEDULE 13D
CUSIP NO. 44860M108 Page 13 of 14 Pages
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(j) In connection with the 2005 Private Financing, the Company
entered into a registration rights agreement, dated as of May
20, 2005, with the investors in the 2005 Private Financing and
Pillar (the "2005 Registration Rights Agreement") under which
the Company agreed to register the shares of Common Stock
issuable upon exercise of the 2005 Pillar Warrants and the
shares of Common Stock issuable upon conversion of the Optima
Note. The summary of the 2005 Registration Rights Agreement in
this Amendment is qualified in its entirety by reference to
the 2005 Registration Rights Agreement, which is attached as
Exhibit 99.11 hereto.
(k) Optima is subject to the Memorandum and Articles of
Association of Optima, as amended (the "Memorandum and
Articles"), which were adopted by Optima on April 27, 2005,
and the Management Agreement dated August 20, 2003 between
Optima and Pillar (the "Management Agreement"). The Memorandum
and Articles establish the rights, preferences and privileges
of the different classes of capital in Optima, including the
management shares held by Pillar. These rights, preferences
and privileges include voting rights, redemption rights and
rights upon the windup of Optima. The Management Agreement
provides that Pillar will serve as the Manager and Investment
Advisor of Optima and will administer Optima's day-to-day
activities. Optima has agreed to pay Pillar's fees and
expenses for these services in shares of Common Stock. Such
payment of shares of Common Stock will generally occur upon
the exercise by shareholders of Optima of their redemption
rights. The summaries of the Memorandum and Articles and the
Management Agreement in this Amendment are qualified in their
entirety by reference to the Memorandum and Articles and to
the Management Letter, which are attached as Exhibit 99.12 and
incorporated by reference to Exhibit 99.13 hereto,
respectively.
Except as described above, there are no contracts, arrangements,
understandings or relationships (legal or otherwise) among the Reporting Persons
or, to the knowledge of the Reporting Parties, the Listed Directors, or between
such persons and any other person with respect to any securities of the Company.
Item 7. Material to be Filed as Exhibits.
The following documents are filed as exhibits to this statement:
99.1 Joint Filing Agreement, dated as of September 8, 2003, by and
among the Reporting Parties (incorporated by reference to
Exhibit 1 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
SCHEDULE 13D
CUSIP NO. 44860M108 Page 14 of 14 Pages
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99.2 Warrant to purchase 1,650,114 shares of Common Stock issued to
Optima on August 28, 2003 (incorporated by reference to
Exhibit 3 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
99.3 Warrant to purchase 587,709 shares of Common Stock issued to
Pillar on August 28, 2003 (incorporated by reference to
Exhibit 5 to the filing on Schedule 13D by the Reporting
Parties dated September 8, 2003).
99.4 Warrant to purchase 553,620 shares of Common Stock issued to
Optima on August 27, 2004 (filed herewith).
99.5 Warrant to purchase 432,520 shares of Common Stock issued to
Pillar on August 27, 2004 (filed herewith).
99.6 Subscription Agreement, dated as of May 20, 2005, by and
between the Company and Optima (filed herewith).
99.7 Noteholders Agreement, dated as of May 20, 2005, by and among
the Company and the investors in the 2005 Private Financing,
including Optima (filed herewith).
99.8 4% Convertible Senior Note Due 2008 in the principal amount of
$3,102,750, dated as of May 24, 2005, made by the Company to
the order of Optima (filed herewith).
99.9 Engagement letter, dated as of May 20, 2005, by and between
the Company and Pillar (filed herewith).
99.10 Warrant to purchase 565,478 shares of Common Stock issued to
Pillar on May 24, 2005 (filed herewith).
99.11 Registration Rights Agreement, dated as of May 20, 2005, by
and among the Company, the investors in the 2005 Private
Financing and Pillar (filed herewith).
99.12 Memorandum and Articles of Association of Optima, as amended,
adopted by Optima on April 27, 2005 (filed herewith).
99.13 Management Agreement, dated August 20, 2003, by and between
Optima and Pillar (incorporated by reference to Exhibit 8 to
the filing on Schedule 13D by the Reporting Parties dated
September 8, 2003).
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
June 30, 2005
By: /s/ Youssef El-Zein
--------------------
Youssef El-Zein
PILLAR INVESTMENT LIMITED
By: /s/ Youssef El-Zein
--------------------
Youssef El-Zein
Director
OPTIMA LIFE SCIENCES LIMITED
By: /s/ Bilal Sidani
--------------------
Bilal Sidani
Director
SCHEDULE I
Set forth below is the name, position, present principal occupation and
business address of each of the directors Pillar and Optima.
Pillar
--------------------------------------------------------------------------------------------------------------------
Name Position with Present Principal Business Address Citizenship
Pillar Occupation
--------------------------------------------------------------------------------------------------------------------
Youssef El-Zein Director Director of 142 Al Moutrane Street France
Pillar Investment 5th Floor
Limited Beirut Central District
Beirut 2012-7106 Lebanon
Bilal Sidani Director Director of 142 Al Moutrane Street France
Pillar Investment 5th Floor
Limited Beirut Central District
Beirut 2012-7106 Lebanon
Optima
--------------------------------------------------------------------------------------------------------------------
Name Position with Present Principal Business Address Citizenship
Optima Occupation
--------------------------------------------------------------------------------------------------------------------
Youssef El-Zein Director Director of 142 Al Moutrane Street France
Pillar Investment 5th Floor
Limited Beirut Central District
Beirut 2012-7106 Lebanon
Bilal Sidani Director Director of 142 Al Moutrane Street France
Pillar Investment 5th Floor
Limited Beirut Central District
Beirut 2012-7106 Lebanon
David Burge Director Managing Director of St. James's Chambers, 64A United
Caledonian Trust Athol Street, Kingdom
(IOM) Limited, a Douglas, Isle of
licensed Corporate Man IM1 1JE
Service Provider
under the laws of
the Isle of Man