As
filed with the Securities and Exchange Commission on January 18,
2011
|
Registration
No. 333-170474
|
Delaware
|
2834
|
52-2286452
|
||
(State
or other jurisdiction of incorporation or
organization)
|
(Primary
Standard Industrial Classification
Code
Number)
|
(I.R.S.
Employer
Identification
No.)
|
David
M. Tanen
|
Copies
to:
|
President
|
Christopher
J. Melsha, Esq.
|
Arno
Therapeutics, Inc.
|
Sean
M. Nagle, Esq.
|
4
Campus Drive, 2nd Floor
|
Fredrikson
& Byron, P.A.
|
Parsippany,
NJ 07054
|
200
South Sixth Street, Suite 4000
|
(862)
703-7170
|
Minneapolis,
MN 55402-1425
|
(Name,
address, including zip code, and telephone number,
|
Telephone:
(612) 492-7000
|
including
area code, of agent for service)
|
Facsimile:
(612) 492-7077
|
Large
accelerated filer ¨
|
Accelerated
filer ¨
|
Non-accelerated
filer ¨
(Do not check if a smaller reporting company)
|
Smaller
reporting company þ
|
PROSPECTUS
SUMMARY
|
3
|
RISK
FACTORS
|
7
|
NOTE
REGARDING FORWARD-LOOKING STATEMENTS
|
19
|
USE
OF PROCEEDS
|
20
|
SELLING
STOCKHOLDERS
|
20
|
ADDITIONAL
DISCLOSURE REGARDING TRANSACTIONS BETWEEN THE COMPANY AND THE SELLING
STOCKHOLDERS
|
24
|
PLAN
OF DISTRIBUTION
|
26
|
DESCRIPTION
OF CAPITAL STOCK
|
29
|
MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
|
30
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
32
|
OUR
BUSINESS
|
39
|
MANAGEMENT
AND BOARD OF DIRECTORS
|
55
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
|
62
|
TRANSACTIONS
WITH RELATED PERSONS, PROMOTERS AND CERTAIN CONTROL
PERSONS
|
64
|
WHERE
YOU CAN FIND MORE INFORMATION
|
64
|
VALIDITY
OF COMMON STOCK
|
64
|
EXPERTS
|
64
|
TRANSFER
AGENT
|
64
|
DISCLOSURE
OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
|
65
|
FINANCIAL
STATEMENTS
|
F-1
|
·
|
AR-12 – Our lead
clinical product candidate is being developed as a potentially
first-in-class, orally available, targeted anti-cancer agent that has
been shown in pre-clinical studies to inhibit phosphoinositide
dependent protein kinase-1, or PDK-1, a protein in the PI3K/Akt pathway
that is involved in the growth and proliferation of cells, including
cancer cells. We believe AR-12 may also cause cell death through the
induction of stress in the endoplasmic reticulum. In May 2009, the FDA
accepted our investigational new drug application, or IND, for
AR-12. We are currently conducting a multi-centered Phase I clinical
study of AR-12 in adult patients with advanced or recurrent solid tumors
or lymphoma. The Phase I study of AR-12 is being
conducted in two parts. The first part is a dose-escalating study,
which we refer to as the Escalation Phase, primarily designed to evaluate
the compound’s safety in order to identify the maximum tolerated dose, or
MTD, or a recommended dose, or RD, for future studies of AR-12. We
anticipate that the Escalation Phase will be completed in 2011.
Following the Escalation Phase, we plan to initiate the second part of the
study, which involves enrolling an expanded cohort of additional patients
at the MTD or RD in multiple tumor types. We refer to this second
part of the study as the Expansion Phase. The purpose of the Expansion
Phase is to further evaluate and confirm the pharmacodynamics, or PD,
effects, potential anti-tumor activity, and safety of AR-12 at the MTD or
RD in specific patient populations. We anticipate that most
subgroups of the Expansion Phase will be fully enrolled within one year
from the initiation of this
phase.
|
·
|
AR-42 – We are also
developing AR-42, an orally available, broad spectrum inhibitor of both
histone and non-histone deacetylation proteins, or Pan-DAC, which play an
important role in the regulation of gene expression, cell growth and
survival. In preclinical studies, AR-42 has demonstrated greater
potency and activity in solid and liquid tumors when compared to
vorinostat (also known as SAHA and marketed as Zolinza® by
Merck) and other deacetylase inhibitors. These data demonstrate the potent
and differentiating activity of AR-42. Additionally, pre-clinical findings
presented at the 2009 American Society of Hematology Annual Meeting and
Exposition showed that AR-42 potently and selectively inhibits leukemic
stem cells in acute myeloid leukemia, or AML. AR-42 is currently
being studied in an investigator initiated Phase I/IIa clinical study in
adult patients with relapsed or refractory multiple myeloma, chronic
lymphocytic leukemia, or CLL, or lymphoma. We expect to identify the
MTD by mid-2011. Once the MTD is defined, the study is designed
so that additional patients can be added to investigate efficacy in a
particular disease and help guide future Phase II programs. Up to an
additional 10 patients may be enrolled at the MTD dose in each of multiple
myeloma, CLL and lymphoma. We expect this expansion phase will
take 12 months to
complete.
|
·
|
AR-67
– We are also developing AR-67, a novel, third-generation camptothecin
analogue that inhibits Topoisomerase I activity. In 2008, we completed a
multi-centered, ascending dose Phase I clinical trial of AR-67 in patients
with advanced solid tumors. AR-67 is currently being studied in a
Phase II clinical trial in patients with glioblastoma multiforme, or
GBM, a highly aggressive form of brain cancer. We anticipate having
interim data from this Phase II study by the third quarter of
2011. Thereafter, if data permits, we may elect to initiate larger
Phase II studies or advance AR-67 into a registration-enabling Phase III
study.
|
Common
stock offered
|
26,815,831
shares
|
|
Common
stock outstanding before the offering(1)
|
20,412,024
shares
|
|
Common
stock outstanding after the offering(2)
|
44,761,798
shares
|
|
Use
of Proceeds
|
We
will receive none of the proceeds from the sale of the shares by the
selling stockholders, except for the warrant exercise price upon exercise
of the warrants, which would be used for working capital and other general
corporate purposes
|
|
Pink
Sheets Symbol
|
ARNI.PK
|
(1)
|
Based
on the number of shares outstanding as of December 31, 2010, not
including 2,388,555 shares issuable upon exercise of various warrants and
options to purchase our common stock or any Shares of Series A Preferred
Stock or warrants to purchase Series A Preferred
Stock.
|
(2)
|
Assumes the issuance of all shares offered hereby
that are issuable upon the conversion of our outstanding Series A
Convertible Preferred Stock or upon exercise of warrants. Also
assumes six months of dividend accrual at the rate of 5% per annum prior
to the automatic conversion of the Series A Convertible Preferred Stock
into common stock upon the effectiveness of the registration statement of
which this prospectus is a part, and our election to pay such accrued
dividends in the form of additional shares of common stock in lieu of
cash. See “Description
of Capital Stock – Series A Convertible Preferred
Stock.”
|
|
·
|
continue
to undertake pre-clinical development and clinical trials for our product
candidates;
|
|
·
|
seek
regulatory approvals for our product
candidates;
|
|
·
|
in-license
or otherwise acquire additional products or product
candidates;
|
|
·
|
seek
patent protection for our product
candidates;
|
|
·
|
implement
additional internal systems and infrastructure;
and
|
|
·
|
hire
additional personnel.
|
|
·
|
continuing
to undertake pre-clinical development and clinical trials for our product
candidates;
|
|
·
|
participating
in regulatory approval processes;
|
|
·
|
formulating
and manufacturing products; and
|
|
·
|
conducting
sales and marketing activities.
|
|
·
|
decreased demand for our
product candidates;
|
|
·
|
injury to our
reputation;
|
|
·
|
withdrawal of clinical trial
participants;
|
|
·
|
withdrawal of prior
governmental approvals;
|
|
·
|
costs of related
litigation;
|
|
·
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substantial monetary awards to
patients;
|
|
·
|
product
recalls;
|
|
·
|
loss of revenue;
and
|
|
·
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the inability to commercialize
our product candidates.
|
|
·
|
delay
commercialization of, and our ability to derive product revenues from, our
product candidates;
|
|
·
|
impose
costly procedures on us; or
|
|
·
|
diminish
any competitive advantages that we may otherwise
enjoy.
|
|
·
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delays
in patient enrollment, and variability in the number and types of patients
available for clinical trials;
|
|
·
|
difficulty
in maintaining contact with patients after treatment, resulting in
incomplete data;
|
|
·
|
poor
effectiveness of product candidates during clinical
trials;
|
|
·
|
safety
issues, side effects, or other adverse
events;
|
|
·
|
results
that do not demonstrate the safety or effectiveness of the product
candidates;
|
|
·
|
governmental
or regulatory delays and changes in regulatory requirements, policy and
guidelines; and
|
|
·
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varying
interpretation of data by the FDA.
|
|
·
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perceptions
by members of the health care community, including physicians, about the
safety and effectiveness of our
drugs;
|
|
·
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cost-effectiveness
of our products relative to competing
products;
|
|
·
|
availability
of reimbursement for our products from government or other healthcare
payers; and
|
|
·
|
effectiveness
of marketing and distribution efforts by us and our licensees and
distributors, if any.
|
|
·
|
We
may be unable to identify manufacturers on acceptable terms or at all
because the number of potential manufacturers is limited and the FDA must
approve any replacement contractor. This approval would require new
testing and compliance inspections. In addition, a new manufacturer would
have to be educated in, or develop substantially equivalent processes for,
production of our products after receipt of FDA approval, if
any.
|
|
·
|
Our
third-party manufacturers might be unable to formulate and manufacture our
drugs in the volume and of the quality required to meet our clinical
and/or commercial needs, if any.
|
|
·
|
Our
future contract manufacturers may not perform as agreed or may not remain
in the contract manufacturing business for the time required to supply our
clinical trials or to successfully produce, store and distribute our
products.
|
|
·
|
Drug
manufacturers are subject to ongoing periodic unannounced inspection by
the FDA and corresponding state agencies to ensure strict compliance with
good manufacturing practice and other government regulations and
corresponding foreign standards. We do not have control over third-party
manufacturers’ compliance with these regulations and standards, but we
will be ultimately responsible for any of their
failures.
|
|
·
|
If
any third-party manufacturer makes improvements in the manufacturing
process for our products, we may not own, or may have to share, the
intellectual property rights to the innovation. This may prohibit us from
seeking alternative or additional manufacturers for our
products.
|
|
·
|
developing
drugs;
|
|
·
|
undertaking
pre-clinical testing and human clinical
trials;
|
|
·
|
obtaining
FDA and other regulatory approvals of
drugs;
|
|
·
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formulating
and manufacturing drugs; and
|
|
·
|
launching,
marketing and selling drugs.
|
|
·
|
government
and health administration
authorities;
|
|
·
|
private
health maintenance organizations and health insurers;
and
|
|
·
|
other
healthcare payers.
|
|
·
|
the
degree and range of protection any patents will afford us against
competitors including whether third parties will find ways to invalidate
or otherwise circumvent our
patents;
|
|
·
|
if
and when patents will issue;
|
|
·
|
whether
or not others will obtain patents claiming aspects similar to those
covered by our patents and patent applications;
or
|
|
·
|
whether
we will need to initiate litigation or administrative proceedings which
may be costly whether we win or
lose.
|
|
·
|
obtain
licenses, which may not be available on commercially reasonable terms, if
at all;
|
|
·
|
redesign
our products or processes to avoid
infringement;
|
|
·
|
stop
using the subject matter claimed in the patents held by
others;
|
|
·
|
pay
damages; or
|
|
·
|
defend
litigation or administrative proceedings which may be costly whether we
win or lose, and which could result in a substantial diversion of our
valuable management resources.
|
|
·
|
the
risk that recurring losses, negative cash flows and the inability to raise
additional capital could threaten our ability to continue as a going
concern;
|
|
·
|
the
risk that we may not successfully develop and market our product
candidates, and even if we do, we may not become
profitable;
|
|
·
|
risks
relating to the progress of our research and
development;
|
|
·
|
risks
relating to significant, time-consuming and costly research and
development efforts, including pre-clinical studies, clinical trials and
testing, and the risk that clinical trials of our product candidates may
be delayed, halted or fail;
|
|
·
|
risks
relating to the rigorous regulatory approval process required for any
products that we may develop independently, with our development partners
or in connection with any collaboration
arrangements;
|
|
·
|
the
risk that changes in the national or international political and
regulatory environment may make it more difficult to gain FDA or other
regulatory approval of our drug product
candidates;
|
|
·
|
risks
that the FDA or other regulatory authorities may not accept any
applications we file;
|
|
·
|
risks
that the FDA or other regulatory authorities may withhold or delay
consideration of any applications that we file or limit such applications
to particular indications or apply other label
limitations;
|
|
·
|
risks
that, after acceptance and review of applications that we file, the FDA or
other regulatory authorities will not approve the marketing and sale of
our drug product candidates;
|
|
·
|
risks
relating to our drug manufacturing operations, including those of our
third-party suppliers and contract
manufacturers;
|
|
·
|
risks
relating to the ability of our development partners and third-party
suppliers of materials, drug substance and related components to provide
us with adequate supplies and expertise to support manufacture of drug
product for initiation and completion of our clinical
studies;
|
|
·
|
risks
relating to the transfer of our manufacturing technology to third-party
contract manufacturers; and
|
|
·
|
other
risks and uncertainties detailed in “Risk
Factors.”
|
|
·
|
2,466,057
shares that are currently issued and
outstanding;
|
|
·
|
15,274,000
shares that are issuable upon the conversion of our outstanding Series A
Preferred Stock;
|
|
·
|
Up
to 381,844 shares of our common stock that may be issued in payment of
accrued dividends upon the conversion of our Series A Preferred Stock
(assumes six months of dividend accrual at the rate of 5% per annum prior
to the conversion of the Series A Preferred Stock into common stock);
and
|
|
·
|
8,693,930
shares that are issuable upon the exercise of outstanding
warrants.
|
Number
of
|
||||||||||||||||||||||||
shares
|
Number
of
|
|||||||||||||||||||||||
offered
by
|
shares
|
|||||||||||||||||||||||
selling
|
offered
by
|
Beneficial
|
||||||||||||||||||||||
Number
of
|
stockholder
|
selling
|
ownership
|
|||||||||||||||||||||
Shares
|
outstanding
|
upon
|
stockholder
|
after
|
||||||||||||||||||||
beneficially
|
shares
offered
|
conversion
of
|
upon
|
offering(1)
|
||||||||||||||||||||
owned
before
|
by
selling
|
preferred
stock
|
exercise
of
|
Number
of
|
||||||||||||||||||||
Selling
Stockholder
|
offering
(1)(2)
|
stockholder
|
(2)
|
warrants
|
shares
|
Percent
|
||||||||||||||||||
3071341
Canada Inc. (3)
|
79,402 | - | 25,625 | 12,500 | 41,277 | * | ||||||||||||||||||
6984321
Canada Inc. (4)
|
19,467 | - | 6,150 | 3,000 | 10,317 | * | ||||||||||||||||||
87111
Canada Limited (5)
|
100,041 | - | 25,625 | 12,500 | 61,916 | * | ||||||||||||||||||
Alan
T. Yuasa as Trustee of the Michael J. Shimoko Trust
|
152,500 | - | 102,500 | 50,000 | - | - | ||||||||||||||||||
Allan
Pantuck and Jodi Pantuck (JTWROS)
|
18,300 | - | 12,300 | 6,000 | - | - | ||||||||||||||||||
Allen
Rubin (6)
|
19,467 | - | 6,150 | 3,000 | 10,317 | * | ||||||||||||||||||
Alrac
Investments Inc. (7)
|
19,062 | - | 12,812 | 6,250 | - | - | ||||||||||||||||||
Arie
and Rebecka Belldegrun as Trustees of the Belldegrun Family Trust dated
February 18, 1994 (8)
|
1,355,381 | - | 128,125 | 62,500 | 592,881 | 1.3 | ||||||||||||||||||
Benjamin
Bernstein (9)
|
553,504 | - | - | 75,000 | 478,504 | * | ||||||||||||||||||
Canyon
Value Realization Fund (Cayman) Ltd. (10)
|
1,011,330 | 687,651 | - | - | - | - | ||||||||||||||||||
Canyon
Value Realization Fund, L.P. (10)
|
1,011,330 | 263,069 | - | - | - | - | ||||||||||||||||||
Canyon
Value Realization Mac-18 Ltd. (10)
|
1,011,330 | 60,610 | - | - | - | - | ||||||||||||||||||
Clal
Finance Underwriting Ltd. (11)
|
3,132,227 | 9,968 | - | - | - | - | ||||||||||||||||||
Clal
Insurance Company Ltd. – Profit Participating Policies
(11)
|
3,132,227 | 825,578 | 717,500 | 350,000 | - | - | ||||||||||||||||||
Clal
Pension & Provident Funds Ltd. – Sapir (11)
|
3,132,227 | 412,788 | 272,650 | 133,000 | - | - | ||||||||||||||||||
Clal
Pension & Provident Funds Ltd. – Yahalom (11)
|
3,132,227 | 206,393 | 137,350 | 67,000 | - | - | ||||||||||||||||||
Commercial
Street Capital, LLC (12)
|
3,355,000 | - | 2,255,000 | 1,100,000 | - | - |
Number
of
|
||||||||||||||||||||||||
shares
|
Number
of
|
|||||||||||||||||||||||
offered
by
|
shares
|
|||||||||||||||||||||||
selling
|
offered
by
|
Beneficial
|
||||||||||||||||||||||
Number
of
|
stockholder
|
selling
|
ownership
|
|||||||||||||||||||||
Shares
|
outstanding
|
upon
|
stockholder
|
after
|
||||||||||||||||||||
beneficially
|
shares
offered
|
conversion
of
|
upon
|
offering(1)
|
||||||||||||||||||||
owned
before
|
by
selling
|
preferred
stock
|
exercise
of
|
Number
of
|
||||||||||||||||||||
Selling
Stockholder
|
offering
(1)(2)
|
stockholder
|
(2)
|
warrants
|
shares
|
Percent
|
||||||||||||||||||
DAFNA
Life Science Ltd. (13)
|
152,500 | - | 24,600 | 12,000 | - | - | ||||||||||||||||||
DAFNA
Life Science Market Neutral Ltd. (13)
|
152,500 | - | 18,450 | 9,000 | - | - | ||||||||||||||||||
DAFNA
Life Science Select Ltd. (13)
|
152,500 | - | 59,450 | 29,000 | - | - | ||||||||||||||||||
David
M. Tanen (14)
|
1,631,545 | - | 66,625 | 100,152 | 1,464,768 | 3.3 | ||||||||||||||||||
Dikla
Insurance Company Ltd. (15)
|
28,620 | - | 9,528 | 4,648 | 14,444 | * | ||||||||||||||||||
Esperante
AB (16)
|
762,500 | - | 512,500 | 250,000 | - | - | ||||||||||||||||||
FCC
Ltd (17)
|
763,800 | - | 307,500 | 456,300 | - | - | ||||||||||||||||||
Genesis
Capital Advisors, LLC (18)
|
2,135,000 | - | 153,750 | 75,000 | - | - | ||||||||||||||||||
Genesis
Opportunity Fund, LP (18)
|
2,135,000 | - | 1,281,250 | 625,000 | - | - | ||||||||||||||||||
Georgette
Pagano
|
38,125 | - | 25,625 | 12,500 | - | - | ||||||||||||||||||
Hank
C.K. Wuh
|
38,125 | - | 25,625 | 12,500 | - | - | ||||||||||||||||||
Harel
Insurance Company Ltd. (19)
|
821,010 | - | 208,446 | 101,681 | 377,688 | * | ||||||||||||||||||
Harel
Pension Fund Management Company Ltd. (19)
|
821,010 | - | 53,531 | 26,113 | 377,688 | * | ||||||||||||||||||
Harel
Provident Funds Ltd. (19)
|
821,010 | - | 35,993 | 17,558 | 377,688 | * | ||||||||||||||||||
I-Bankers
Securities, Inc. (20)
|
207,750 | - | 82,000 | 40,000 | - | - | ||||||||||||||||||
IBS
Securities Ltd. (20)
|
207,750 | - | - | 85,750 | - | - | ||||||||||||||||||
Ira
Kalfus
|
53,375 | - | 35,875 | 17,500 | - | - | ||||||||||||||||||
Isaac
Kier (21)
|
275,627 | - | 51,250 | 25,000 | 199,377 | * | ||||||||||||||||||
Joia
Kazam and Joshua Kazam (JTWROS) (22)
|
2,055,433 | - | 256,250 | 125,000 | 1,593,989 | 3.6 | ||||||||||||||||||
Joshua
Kazam (22)
|
2,055,433 | - | - | 80,194 | 1,593,989 | 3.6 | ||||||||||||||||||
Kappa
Investors LLC (23)
|
3,896,788 | - | 172,210 | 84,005 | 2,005,789 | 4.5 | ||||||||||||||||||
Kardan
Israel Ltd. (24)
|
1,525,000 | - | 1,025,000 | 500,000 | - | - | ||||||||||||||||||
Kenzo
Kosuda
|
76,250 | - | 51,250 | 25,000 | - | - | ||||||||||||||||||
Leumi
Overseas Trust Corporation Limited as Trustee of the BTL Trust
(8)
|
1,355,381 | - | 256,250 | 125,000 | 592,881 | 1.3 | ||||||||||||||||||
MDRB
Partnership, L.P. (8)
|
1,355,381 | - | 128,125 | 62,500 | 592,881 | 1.3 | ||||||||||||||||||
Nazy
Zomorodian
|
45,750 | - | 30,750 | 15,000 | - | - | ||||||||||||||||||
Ogier
Employee Benefit Trust Limited as Trustees of the MBES Employee Benefit
Trust – JD Sub Trust (25)
|
152,500 | - | 102,500 | 50,000 | - | - | ||||||||||||||||||
Peter
Kash (26)
|
2,031,587 | - | - | 189,534 | 1,689,553 | 3.8 | ||||||||||||||||||
Peter
Kash and Donna Kash (JTWROS) (26)
|
2,031,587 | - | 102,500 | 50,000 | 1,689,553 | 3.8 | ||||||||||||||||||
Pontifax
(Cayman) II L.P. (27)
|
4,574,998 | - | 1,503,174 | 733,256 | - | - | ||||||||||||||||||
Pontifax
(Israel) II - Individual Investors L.P. (27)
|
4,574,998 | - | 439,540 | 214,410 | - | - | ||||||||||||||||||
Pontifax
(Israel) II L.P. (27)
|
4,574,998 | - | 1,132,284 | 552,334 | - | - | ||||||||||||||||||
Primafides
(Suisse) SA as Trustees of the Sirius Trust (28)
|
694,306 | - | 102,500 | 50,000 | 541,806 | 1.2 | ||||||||||||||||||
Ricardo
de la Guardia
|
38,125 | - | 25,625 | 12,500 | - | - | ||||||||||||||||||
Robert
I. Falk (29)
|
397,722 | - | 102,500 | 50,000 | 245,222 | * | ||||||||||||||||||
Sabrinco
Inc. (30)
|
39,699 | - | 12,812 | 6,250 | 20,637 | * |
Number
of
|
||||||||||||||||||||||||
shares
|
Number
of
|
|||||||||||||||||||||||
offered
by
|
shares
|
|||||||||||||||||||||||
selling
|
offered
by
|
Beneficial
|
||||||||||||||||||||||
Number
of
|
stockholder
|
selling
|
ownership
|
|||||||||||||||||||||
Shares
|
outstanding
|
upon
|
stockholder
|
after
|
||||||||||||||||||||
beneficially
|
shares
offered
|
conversion
of
|
upon
|
offering(1)
|
||||||||||||||||||||
owned
before
|
by
selling
|
preferred
stock
|
exercise
of
|
Number
of
|
||||||||||||||||||||
Selling
Stockholder
|
offering
(1)(2)
|
stockholder
|
(2)
|
warrants
|
shares
|
Percent
|
||||||||||||||||||
Scott
Navins (31)
|
249,532 | - | - | 100,000 | 149,532 | * | ||||||||||||||||||
Sherry
Hyon
|
7,500 | - | - | 7,500 | - | - | ||||||||||||||||||
Steven
Blum (32)
|
194,781 | - | - | 125,000 | 69,781 | * | ||||||||||||||||||
Susumu
Maeda
|
76,250 | - | 51,250 | 25,000 | - | - | ||||||||||||||||||
Taichi
Wakabayashi
|
76,250 | - | 51,250 | 25,000 | - | - | ||||||||||||||||||
UTA
Capital LLC (33)
|
3,050,000 | - | 2,050,000 | 1,000,000 | - | - | ||||||||||||||||||
Uzi
Zucker
|
457,500 | - | 307,500 | 150,000 | - | - | ||||||||||||||||||
Wexford
Spectrum Investors LLC (23)
|
3,896,788 | - | 1,098,789 | 535,995 | 2,005,789 | 4.5 | ||||||||||||||||||
Yu
Yeung (34)
|
39,937 | - | - | 20,000 | 19,937 | * | ||||||||||||||||||
TOTAL
|
2,466,057 | 15,655,844 | 8,693,930 |
(1)
|
Beneficial
ownership is determined in accordance with Rule 13d-3 under the Exchange
Act, and includes any shares as to which the security or stockholder has
sole or shared voting power or investment power, and also any shares which
the security or stockholder has the right to acquire within 60 days of the
date hereof, whether through the exercise or conversion of any stock
option, convertible security, warrant or other right. The indication
herein that shares are beneficially owned is not an admission on the part
of the security or stockholder that he, she or it is a direct or indirect
beneficial owner of those shares. Percentage of shares beneficially owned
after the resale of all the shares offered by this prospectus assumes
there are outstanding 44,761,798 shares of common stock, including all
shares offered hereby that are issuable upon the conversion of our
outstanding Series A Preferred Stock or upon the exercise of
warrants.
|
(2)
|
Assumes
six months of dividend accrual at the rate of 5% per annum prior to the
automatic conversion of the Series A Preferred Stock into common stock
upon the effectiveness of the registration statement of which this
prospectus is a part, and our election to pay such accrued dividends in
the form of additional shares of common stock in lieu of cash. See
“Description of Capital
Stock – Series A Convertible Preferred
Stock.”
|
(3)
|
Ruth
Hornstein is the president and sole owner of the selling
stockholder. In addition to the shares offered hereby, the selling
stockholder beneficially owns 41,277 shares of our common
stock.
|
(4)
|
Daniel
Ritter is the president of the selling stockholder. In addition to
the shares offered hereby, beneficial ownership includes 10,317 shares of
our common stock held by Mr.
Ritter.
|
(5)
|
Herschel
Schachter, president of the selling stockholder, holds voting and/or
dispositive power over the shares held by the selling stockholder.
In addition to the shares offered hereby, the selling stockholder
beneficially owns 61,916 shares of our common
stock.
|
(6)
|
In
addition to the shares offered hereby, the selling stockholder
beneficially owns 10,317 shares of our common
stock.
|
(7)
|
Lawrence
Stein is the director of the selling
stockholder.
|
(8)
|
Beneficial
ownership includes: (i) 128,125 shares of our common stock that are
issuable upon the conversion of our outstanding Series A Preferred Stock
and 62,500 shares issuable upon the exercise of warrants held by Arie and
Rebecka Belldegrun as Trustees of the Belldegrun Family Trust dated
February 18, 1994; (ii) 256,250 shares of our common stock that are
issuable upon the conversion of our outstanding Series A Preferred Stock,
125,000 shares issuable upon the exercise of warrants and 61,916 shares of
our common stock held by Leumi Overseas Trust Corporation Limited as
Trustee of the BTL Trust; (iii) 128,125 shares of our common stock that
are issuable upon the conversion of our outstanding Series A Preferred
Stock and 62,500 shares issuable upon the exercise of warrants held by
MDRB Partnership, L.P. (“MDRB”); and (iv) 24,922 shares of our common
stock and 506,043 shares issuable upon the exercise of stock options held
by Arie Belldegrun, M.D. Dr. Belldegrun, who serves as Chairman of
our Board of Directors, is a beneficiary of the BTL Trust and is the
managing partner of MDRB. Richard J. Guillaume and Christopher R.P.
Lees, directors of Leumi Overseas Trust Corporation Limited (“Leumi”),
hold voting and/or dispositive power over the shares held by Leumi as
trustee of the BTL Trust.
|
(9)
|
In
addition to the shares offered hereby, the selling stockholder
beneficially owns 478,504 shares of our common stock, which includes
59,813 shares issuable upon the exercise of
warrants.
|
(10)
|
John
Simpson, Joshua S. Friedman, Mitchell R. Julius and John P. Plaga have
voting and/or dispositive power over the shares held by the selling
stockholder. The selling stockholder has informed us that it is affiliated
with a broker-dealer, and has represented to us that it purchased the
shares in the ordinary course of business with no agreement or
understanding, directly or indirectly, with any persons regarding the
distribution of the shares.
|
(11)
|
Beneficial
ownership includes: (i) 825,578 shares of our common stock held by Clal
Insurance Company Ltd. – Profit Participating Policies; (ii)
412,788 shares of our common stock held by Clal Pension & Provident
Funds Ltd. – Sapir (“Sapir”); (iii) 206,393 shares of our common stock
held by Clal Pension & Provident Funds Ltd. – Yahalom (“Yahalom”); and
(iv) 9,968 shares of our common stock held by Clal Finance Underwriting
Ltd. Yossi Dori holds voting and/or dispositive power over the shares held
by Sapir and Yahalom. Nir Moroz holds voting and/or dispositive power over
the shares held by Clal Insurance Company Ltd. – Profit
Participating Policies.
|
(12)
|
Steven
Ruchefsky, President of Commercial Street Capital, LLC, is a director of
Arno.
|
(13)
|
Fariba
Ghodsian is the managing member of the selling
stockholder.
|
(14)
|
Mr.
Tanen is our President and a member of our board of directors.
Shares listed as beneficially owned by Mr. Tanen include 149,532 shares of
our common stock held by Mr. Tanen’s wife as custodian for the benefit of
their minor children under the Uniform Gift to Minors Act (UGMA), for
which Mr. Tanen disclaims any beneficial ownership. In addition to
the shares offered hereby, beneficial ownership also includes 1,307,334
shares of our common stock and 7,902 shares issuable upon the exercise of
options and warrants held by Mr.
Tanen.
|
(15)
|
Alfred
Rosenfeld and Ofer Nargassi hold voting and/or dispositive power over the
shares held by the selling stockholder. In addition to the shares
offered hereby, beneficial ownership includes: (i) 4,127 shares of our
common stock held by Dikla Insurance Company Ltd. – Nostro; and (ii)
10,317 shares of our common stock held by Dikla Insurance Company Ltd. –
Siudi.
|
(16)
|
Dean
Slagel, director of the selling stockholder, holds voting and/or
dispositive power over the shares held by the selling
stockholder.
|
(17)
|
Yacov
Reizman, chairman and chief executive officer of the selling stockholder,
and Rivka Reizman, president of the selling stockholder, hold voting
and/or dispositive power over the shares held by the selling
stockholder. Mr. Reizman is a director of
Arno.
|
(18)
|
Jaime
Hartman is the managing member of the selling
stockholder.
|
(19)
|
Ronen
Agassi and Ofer Nargassi hold voting and/or dispositive power over the
shares held by the selling stockholder. In addition to the shares
offered hereby, beneficial ownership includes: (i) 20,637 shares of our
common stock held by Harel Insurance Company Ltd. – Clali; (ii) 115,580
shares of our common stock held by Harel Insurance Company Ltd. –
Mishtatefet; (iii) 45,406 shares of our common stock held by Harel
Insurance Company Ltd. – Nostro; (iv) 41,277 shares of our common stock
held by Harel Pension Fund Management Company Ltd. – Harel Pensia; (v)
28,893 shares of our common stock held by Harel Provident Funds Ltd. –
Taoz; (vi) 10,317 shares of our common stock held by Harel Provident
Funds, Ltd. – Hishtalmut; (vii) 8,254 shares of our common stock held by
Harel Provident Funds, Ltd. – Gmisha; and (viii) 107,324 shares of our
common stock held by Harel Provident Funds, Ltd. –
Otzma.
|
(20)
|
Shelley
Gluck holds voting and/or dispositive power over the shares held by the
selling stockholder. I-Bankers Securities, Inc. (“I-Bankers”) is a
registered broker-dealer and the shares offered by I-Bankers are issuable
upon the exercise of warrants received as compensation for placement agent
services in connection with our September 2010 private placement.
IBS Securities Ltd. (“IBS”) is an affiliate of I-Bankers and acquired the
shares offered hereby in the ordinary course of its
business.
|
(21)
|
In
addition to the shares offered hereby, the selling stockholder
beneficially owns 199,377 shares of our common
stock.
|
(22)
|
Shares
listed as beneficially owned by the selling stockholders include, in
addition to the shares offered hereby, (i) 1,129,759 shares of our common
stock and 11,612 shares issuable upon the exercise of options and warrants
held by Mr. Kazam; (ii) 99,688 shares of our common stock held by Mrs.
Kazam as custodian for the benefit of their minor daughter under the UGMA;
(iii) 332,293 shares of our common stock held by the Kazam
Family Trust; and (iv) 20,637 shares of our common stock held by the
Joshua Kazam Trust.
|
(23)
|
In
addition to the shares offered hereby, beneficial ownership includes: (i)
247,345 shares of our common stock held by Kappa Investors LLC (“Kappa”);
(ii) a warrant held by Kappa to purchase 24,732 shares of our common stock
that is exercisable at $2.42 per share; and (iii) 1,733,712 shares of our
common stock held by Wexford Spectrum Investors LLC (“Wexford
Spectrum”). Wexford Capital LP, a Delaware partnership (“Wexford
Capital”), is a registered Investment Advisor and also serves as an
investment advisor or sub-advisor to the members of Kappa and Wexford
Spectrum. Wexford GP LLC (“Wexford GP”) is the general partner of
Wexford Capital. Mr. Charles E. Davidson and Mr. Joseph M. Jacobs
are managing and controlling members of Wexford
GP.
|
(24)
|
Eytan
Rechter is chief executive officer and a director of the selling
stockholder and Asher Elmoznino is chief financial officer of the selling
stockholder.
|
(25)
|
Tania
Bearryman and Donna Laverty hold voting and/or dispositive power over the
shares held by the selling
stockholder.
|
(26)
|
Peter
Kash is a member of our board of directors. Shares listed as
beneficially owned by Mr. Kash include 358,876 shares of our common stock
held by Mr. Kash’s wife as custodian for the benefit of their minor
children under the UGMA, for which Mr. Kash disclaims any beneficial
ownership. In addition to the shares offered hereby, beneficial
ownership also includes 1,327,629 shares of our common stock and 9,138
shares issuable upon the exercise of options and warrants held by Mr.
Kash.
|
(27)
|
Tomer
Kariv and Ran Nussbaum hold voting and/or dispositive power over the
shares held by the selling stockholder. Mr. Kariv is a director of
Arno.
|
(28)
|
Ari
Tatos, Nigel Mifsud, Magali Garcia-Baudin, David Moran, Phillippe De Salis
and Ewald Scherrer are directors of Primafides (Suisse) SA, the trustee of
the Sirius Trust, and share voting and/or dispositive power over the
shares held by the selling stockholder. In addition to the shares
offered hereby, the selling stockholder beneficially owns 541,806 shares
of our common stock.
|
(29)
|
In
addition to the shares offered hereby, beneficial ownership includes: (i)
49,844 shares of our common stock and warrants to purchase 4,946 shares of
our common stock at an exercise price of $2.42 per share held by Falk
Family Partners, LP, of which Mr. Falk is General Partner; and (ii) 90,744
shares of our common stock and vested options held by Mr. Falk to purchase
99,688 shares of our common stock at an exercise price of $2.42 per
share.
|
(30)
|
Samuel
Gewurz is the president and sole owner of the selling stockholder.
In addition to the shares offered hereby, the selling stockholder
beneficially owns 20,637 shares of our common
stock.
|
(31)
|
In
addition to the shares offered hereby, Mr. Navins, who serves as Arno’s
Treasurer, beneficially owns 149,532 shares of our common
stock.
|
(32)
|
In
addition to the shares offered hereby, the selling stockholder
beneficially owns 69,781 shares of our common stock, which includes 29,906
shares issuable upon the exercise of
warrants.
|
(33)
|
YZT
Management LLC (“YZT”) is the managing member of the selling
stockholder. Udi Toledano is the managing member of YZT and holds
voting and/or dispositive power over the shares held by the selling
stockholder.
|
(34)
|
In
addition to the shares offered hereby, the selling stockholder
beneficially owns 19,937 shares of our common
stock.
|
Amounts paid as of
December 31, 2010
|
Potential Future
Payment Obligations
|
Total
|
||||||||||
Placement
Fees (1)
|
$ | 1,056,930 | $ | - | $ | 1,056,930 | ||||||
Placement
Warrants (2)
|
464,720 | - | 464,720 | |||||||||
Liquidated
Damages for Delayed Registration (3)
|
- | 1,832,880 | 1,832,880 | |||||||||
Total
payments and potential payments
|
$ | 1,521,650 | $ | 1,832,880 | $ | 3,354,530 |
(1)
|
In
consideration for their services as placement agents, we paid Riverbank a
cash placement fee of $789,880, and we paid I-Bankers, Riverbank’s
sub-agent, a cash placement fee of
$267,050.
|
(2)
|
In
addition to the cash fees described in footnote (1), we also issued
five-year warrants to purchase an aggregate of 1,056,930 shares of Series
A Preferred Stock at an initial exercise price of $1.10 per share to the
placement agents and their designees (consisting of warrants to purchase
an aggregate of 664,880 shares to designees of Riverbank and warrants to
purchase an aggregate of 392,050 shares to I-Bankers and its
designees). The Placement Warrants were valued at $464,720
using the Black-Scholes option-pricing model. The shares
issuable upon exercise of the Placement Warrants are being offered by this
prospectus.
|
(3)
|
Under
the Purchase Agreement, we agreed to use our best efforts to cause the
registration statement of which this prospectus is a part to be declared
effective within 180 days following the initial closing under the Purchase
Agreement, or by March 8, 2011. If the registration statement
is not declared effective by the SEC by such date, we will pay liquidated
damages to the investors in the amount of 1% of each investor’s aggregate
investment amount for each 30-day period until the registration statement
is declared effective; provided, however, that the maximum amount of
liquidated damages payable by us is capped at 12% of the aggregate amount
invested under the Purchase Agreement, or
$1,832,880.
|
Gross
Company Proceeds from September 2010 Private Placement
|
$
|
15,274,000
|
||
Payments
and Potential Payments to Selling Stockholders (1)
|
3,354,530
|
|||
Net
Company Proceeds from September 2010 Private Placement
(2)
|
$
|
11,919,470
|
||
Payments
and Potential Payments to Selling Stockholders as a Percentage
of
Net Company Proceeds from September 2010 Private Placement
(3)
|
28.1
|
%
|
(1)
|
Includes
$1,832,880 in potential liquidated damages that we may be required to pay
if the registration statement of which this prospectus is a part is
not declared effective by the SEC as set forth above under “—Payments in
connection with the September 2010 Private
Placement.”
|
(2)
|
If
we are not required to pay the potential liquidated damages described in
footnote (1), the net proceeds to us from the September 2010 private
placement will be $13,752,350.
|
(3)
|
If
we are not required to pay the potential liquidated damages described in
footnote (1), this amount will be reduced to
11.1%.
|
Selling Stockholder
|
Date of
Transaction
|
Total Number
of Shares
Outstanding
Prior to the
Transaction
|
Total Number of
Shares held by
Non-Affiliates
Prior to the
Transaction (1)
|
Total Number of
Shares Issued or
Issuable to the
Selling Stockholder
in the Transaction
|
Shares Issued
or Issuable in
Transaction as
a Percentage of
Shares held by
Non-Affiliates
|
Market Price
Per Share
Immediately
Prior to the
Transaction
(2)
|
Current
Market
Price Per
Share (3)
|
|||||||||||||||||||
3071341
Canada Inc.
|
6/2/08
|
9,968,797 | 4,169,985 | 41,277 | 1.0 | $ | 2.42 | $ | 1.00 | |||||||||||||||||
6984321
Canada Inc.
|
6/2/08
|
9,968,797 | 4,169,985 | 10,317 | * | $ | 2.42 | $ | 1.00 | |||||||||||||||||
87111
Canada Limited
|
6/2/08
|
9,968,797 | 4,169,985 | 61,916 | 1.5 | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Allen
Rubin
|
6/2/08
|
9,968,797 | 4,169,985 | 10,317 | * | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Belldegrun
Selling Stockholders (4)
|
8/9/05
|
- | - | 24,922 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 61,916 | 1.5 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Benjamin
Bernstein (5)
|
8/9/05
|
- | - | 418,691 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
1/2/08
|
9,968,797 | 4,169,985 | 59,813 | 1.4 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Canyon
Selling Stockholders (6)
|
6/2/08
|
9,968,797 | 4,169,985 | 1,011,330 | 24.3 | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Clal
Selling Stockholders (7)
|
8/9/05
|
- | - | 9,968 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 1,444,759 | 34.6 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
David
M. Tanen (8)
|
8/9/05
|
- | - | 1,434,183 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 23,918 | * | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Dikla
Insurance Company Ltd. (9)
|
6/2/08
|
9,968,797 | 4,169,985 | 14,444 | * | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Harel
Selling Stockholders (10)
|
6/2/08
|
9,968,797 | 4,169,985 | 377,688 | 9.1 | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Isaac
Kier
|
8/9/05
|
- | - | 199,377 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
Kazam
Selling Stockholders (11)
|
8/9/05
|
- | - | 1,512,273 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 75,050 | 1.8 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Kash
Selling Stockholders (12)
|
8/9/05
|
- | - | 1,641,135 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 47,841 | 1.1 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Primafides
(Suisse) SA as Trustees of the Sirius Trust (13)
|
8/9/05
|
- | - | 199,377 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 342,429 | 8.2 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Robert
I. Falk (14)
|
8/9/05
|
- | - | 49,844 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
6/2/08
|
9,968,797 | 4,169,985 | 95,690 | 2.3 | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Sabrinco
Inc.
|
6/2/08
|
9,968,797 | 4,169,985 | 20,637 | * | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Scott
Navins
|
8/9/05
|
- | - | 149,532 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
Steven
Blum (15)
|
8/9/05
|
- | - | 39,875 | N/A | $ | 0.0005 | $ | 1.00 | |||||||||||||||||
1/2/08
|
9,968,797 | 4,169,985 | 29,906 | * | $ | 2.42 | $ | 1.00 | ||||||||||||||||||
Wexford
Selling Stockholders (16)
|
6/2/08
|
9,968,797 | 4,169,985 | 2,005,798 | 47.8 | $ | 2.42 | $ | 1.00 | |||||||||||||||||
Yu
Yeung
|
8/9/05
|
- | - | 19,937 | N/A | $ | 0.0005 | $ | 1.00 |
Excludes
shares held by the selling stockholders, affiliates of the Company, or
affiliates of the selling
stockholders.
|
(2)
|
Because
there was no market for our common stock at the time of the transaction,
the listed price represents the negotiated price per share at the time of
the transaction.
|
(3)
|
There
is not currently a market for our common stock. See “Plan of
Distribution.”
|
(4)
|
On
August 9, 2005, 24,922 founders shares were issued to Bellco Capital,
Inc. In connection with our June 2, 2008 private placement,
61,916 shares of common stock were issued to Leumi Overseas Trust
Corporation Limited as Trustees of the BTL
Trust.
|
(5)
|
On
August 9, 2005, 418,691 founders shares were issued to Mr.
Bernstein. On January 2, 2008, five-year warrants to purchase
59,813 shares of common stock at an exercise price of $2.42 per share, the
fair market value at the time of issuance, were issued to Mr. Bernstein in
exchange for consulting
services.
|
(6)
|
In
connection with our June 2, 2008 private placement: (i) 687,651 shares of
common stock were issued to Canyon Value Realization Fund (Cayman) Ltd.;
(ii) 263,069 shares were issued to Canyon Value Realization Fund, L.P.;
and (iii) 60,610 shares were issued to Canyon Value Realization Mac-18
Ltd.
|
(7)
|
On
August 9, 2005, 9,968 founders shares were issued to Clal Finance
Underwriting Ltd. In connection with our June 2, 2008 private
placement: (i) 825,578 shares of common stock were issued to Clal
Insurance Company Ltd. – Profit Participating Policies; (ii) 412,788
shares were issued to Clal Pension & Provident Funds Ltd. – Sapir; and
(iii) 206,393 shares were issued to Clal Pension & Provident Funds
Ltd. – Yahalom.
|
(8)
|
On
August 9, 2005: (i) 1,284,651 founders shares were issued to David M.
Tanen; and (ii) 149,532 founders shares were issued to Mr. Tanen’s wife as
custodian for the benefit of their minor children under the Uniform Gift
to Minors Act (UGMA). In connection with our June 2, 2008
private placement: (i) 22,682 shares of common stock were issued to Mr.
Tanen; and (ii) five-year warrants to purchase 1,236 shares of common
stock at an exercise price of $2.42 per share were issued to Mr.
Tanen.
|
(9)
|
In
connection with our June 2, 2008 private placement: (i) 4,127 shares of
common stock were issued to Dikla Insurance Company Ltd. – Nostro; and
(ii) 10,317 shares were issued to Dikla Insurance Company Ltd. –
Siudi.
|
(10)
|
In
connection with our June 2, 2008 private placement: (i) 20,637 shares of
common stock were issued to Harel Insurance Company Ltd. – Clali; (ii)
115,580 shares were issued to Harel Insurance Company Ltd. – Mishtatefet;
(iii) 45,406 shares were issued to Harel Insurance Company Ltd. – Nostro;
(iv) 41,277 shares were issued to Harel Pension Fund Management Company
Ltd. – Harel Pensia; (v) 28,893 shares were issued to Harel Provident
Funds Ltd. – Taoz; (vi) 10,317 shares were issued to Harel Provident
Funds, Ltd. – Hishtalmut; (vii) 8,254 shares were issued to Harel
Provident Funds, Ltd. – Gmisha; and (viii) 107,324 shares were issued to
Harel Provident Funds, Ltd. –
Otzma.
|
(11)
|
On
August 9, 2005: (i) 1,080,292 founders shares were issued to Joshua Kazam;
(ii) 99,688 founders shares were issued to Mr. Kazam’s wife as custodian
for the benefit of their minor daughter under the UGMA; and (iii) 332,293
founders shares were issued to the Kazam Family Trust. In
connection with our June 2, 2008 private placement: (i) 20,637 shares of
common stock were issued to the Joshua Kazam Trust; (ii) 49,467 shares
were issued to Mr. Kazam; and (iii) five-year warrants to purchase 4,946
shares of common stock at an exercise price of $2.42 per share were issued
to Mr. Kazam.
|
(12)
|
On
August 9, 2005: (i) 1,282,259 founders shares were issued to Peter Kash;
and (ii) 358,876 founders shares were issued to Mr. Kash’s wife as
custodian for the benefit of their minor children under the
UGMA. In connection with our June 2, 2008 private placement:
(i) 45,369 shares of common stock were issued to Mr. Kash; and (ii)
five-year warrants to purchase 2,472 shares of common stock at an exercise
price of $2.42 per share were issued to Mr.
Kash.
|
(13)
|
On
August 9, 2005, 199,377 founders shares were issued to the selling
stockholder. In connection with our June 2, 2008 private
placement: (i) 330,064 shares of common stock were issued to the selling
stockholder; and (ii) five-year warrants to purchase 12,365 shares of
common stock at an exercise price of $2.42 per share were issued to the
selling stockholder.
|
(14)
|
On
August 9, 2005, 49,844 founders shares were issued to Falk Family
Partners, LLC. In connection with our June 2, 2008 private
placement: (i) 41,277 shares of common stock were issued to Mr. Falk; (ii)
49,467 shares were issued to Falk Family Partners, LLC; and (iii)
five-year warrants to purchase 4,946 shares of common stock at an exercise
price of $2.42 per share were issued to Falk Family Partners,
LLC.
|
(15)
|
On
August 9, 2005, 39,875 founders shares were issued to Mr.
Blum. On January 2, 2008, five-year warrants to purchase 29,906
shares of common stock at an exercise price of $2.42 per share, the fair
market value at the time of issuance, were issued to Mr. Blum in exchange
for consulting services.
|
(16)
|
In
connection with our June 2, 2008 private placement: (i) 1,733,712 shares
of common stock were issued to Wexford Spectrum Investors, LLC; (ii)
247,354 shares were issued to Kappa Investors, LLC; and (iii) five-year
warrants to purchase 24,732 shares of common stock at an exercise price of
$2.42 per share were issued to Kappa Investors,
LLC.
|
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
·
|
block
trades in which the broker-dealer will attempt to sell the shares as
agent, but may position and resell a portion of the block as principal to
facilitate the transaction;
|
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for its
account;
|
|
·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
|
·
|
privately
negotiated transactions;
|
|
·
|
short
sales;
|
|
·
|
through
the writing or settlement of options or other hedging transactions,
whether through an options exchange or
otherwise;
|
|
·
|
broker-dealers
may agree with the selling stockholders to sell a specified number of such
shares at a stipulated price per
share;
|
|
·
|
a
combination of any such methods of sale;
and
|
|
·
|
any
other method permitted pursuant to applicable
law.
|
|
·
|
20,412,024
shares of our common stock,
|
|
·
|
15,274,000
shares of our Series A Preferred
Stock,
|
|
·
|
warrants
to purchase 8,693,930 shares of Series A Preferred
Stock,
|
|
·
|
options
to purchase 1,893,303 shares of our common stock at exercise prices
ranging from $0.25 to $3.00 per share,
and
|
|
·
|
warrants
to purchase 495,252 shares of our common stock at an exercise price
of $2.42 per share.
|
Quarter
Ended
|
High
|
Low
|
||||||
March
31, 2008
|
$ | - | $ | - | ||||
June
30, 2008
|
$ | 2.00 | $ | 2.00 | ||||
September
30, 2008
|
$ | 3.50 | $ | 1.80 | ||||
December
31, 2008
|
$ | 3.25 | $ | 1.95 | ||||
March
31, 2009
|
$ | 1.90 | $ | 1.90 | ||||
June
30, 2009
|
$ | 1.50 | $ | 1.00 | ||||
September
30, 2009
|
$ | - | $ | - | ||||
December
31, 2009
|
$ | - | $ | - | ||||
March
31, 2010
|
$ | - | $ | - | ||||
June
30, 2010
|
$ | 0.51 | $ | 0.51 | ||||
September
30, 2010
|
$ | - | $ | - | ||||
December 31, 2010 | $ | - | $ | - |
Plan
category
|
Number of
Securities to be
Issued Upon
Exercise of
Outstanding
Options
(A)
|
Weighted-Average
Exercise Price
of
Outstanding
Options
(B)
|
Number
of Securities
Remaining
Available for
Future
Issuance Under
Equity
Compensation Plans
(Excluding
Securities
Reflected in Column
(A))
(C)
|
|||||||||
Equity
compensation plans approved by security holders:
|
||||||||||||
2005
Stock Option Plan
|
1,893,303
|
$ | 1.36 |
1,077,352
|
||||||||
Equity
compensation plans not approved by stockholders:
|
||||||||||||
None
|
— | — | — | |||||||||
Total
|
1,893,303
|
$ | 1.36 |
1,077,352
|
|
·
|
AR-12 – Our lead clinical product
candidate is being developed as a potentially first-in-class, orally
available, targeted anti-cancer agent that has been shown in pre-clinical
studies to inhibit phosphoinositide dependent protein kinase-1, or PDK-1,
a protein in the PI3K/Akt pathway that is involved in the growth and
proliferation of cells, including cancer cells. We believe AR-12 may
also cause cell death through the induction of stress in the endoplasmic
reticulum. In May 2009, the FDA accepted our investigational new drug
application, or IND, for AR-12. We are currently conducting a
multi-centered Phase I clinical study of AR-12 in adult patients with
advanced or recurrent solid tumors or lymphoma. The
Phase I study of AR-12 is being conducted in two parts. The first
part is a dose-escalating study, which we refer to as the Escalation
Phase, primarily designed to evaluate the compound’s safety in order to
identify the maximum tolerated dose, or MTD, or a recommended dose, or RD,
for future studies of AR-12. We anticipate that the Escalation Phase
will be completed in 2011. Following the Escalation Phase, we plan
to initiate the second part of the study, which involves enrolling an
expanded cohort of additional patients at the MTD or RD in multiple tumor
types. We refer to this second part of the study as the Expansion
Phase. The purpose of the Expansion Phase is to further evaluate and
confirm the pharmacodynamics, or PD, effects, potential anti-tumor
activity, and safety of AR-12 at the MTD or RD in specific patient
populations. We anticipate that most subgroups of the Expansion
Phase will be fully enrolled within one year from the initiation of this
phase.
|
|
·
|
AR-42 – We are also developing AR-42,
an orally available, broad spectrum inhibitor of both histone and
non-histone deacetylation proteins, or Pan-DAC, which play an important
role in the regulation of gene expression, cell growth and survival.
In preclinical studies, AR-42 has demonstrated greater potency and
activity in solid and liquid tumors when compared to vorinostat (also
known as SAHA and marketed as Zolinza® by Merck) and other deacetylase
inhibitors. These data demonstrate the potent and differentiating activity
of AR-42. Additionally, pre-clinical findings presented at the 2009
American Society of Hematology Annual Meeting and Exposition showed that
AR-42 potently and selectively inhibits leukemic stem cells in acute
myeloid leukemia, or AML. AR-42 is currently being studied in an
investigator initiated Phase I/IIa clinical study in adult patients with
relapsed or refractory multiple myeloma, chronic lymphocytic leukemia, or
CLL, or lymphoma. We expect to identify the MTD by
mid-2011. Once the MTD is defined, the study is designed so
that additional patients can be added to investigate efficacy in a
particular disease and help guide future Phase II programs. Up to an
additional 10 patients may be enrolled at the MTD dose in each of multiple
myeloma, CLL and lymphoma. We expect this expansion phase
will take 12 months to
complete.
|
|
·
|
AR-67 – We are also developing AR-67,
a novel, third-generation camptothecin analogue that inhibits
Topoisomerase I activity. In 2008, we completed a multi-centered,
ascending dose Phase I clinical trial of AR-67 in patients with advanced
solid tumors. AR-67 is currently being studied in a Phase II
clinical trial in patients with glioblastoma multiforme, or GBM, a
highly aggressive form of brain cancer. We anticipate having interim
data from this Phase II study by the third quarter of 2011.
Thereafter, if the data is positive, we may elect to initiate larger Phase
II studies or advance AR-67 into a registration-enabling Phase III
study.
|
Three Months Ended September 30,
|
Nine Months Ended September 30,
|
Years Ended December 31,
|
Cumulative
|
|||||||||||||||||||||||||
amounts during
|
||||||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
2009
|
2008
|
development
|
||||||||||||||||||||||
AR-12
|
$
|
286,066
|
$
|
476,901
|
$
|
1,407,048
|
$
|
1,513,344
|
$
|
1,999,469
|
$
|
2,820,442
|
$
|
6,349,385
|
||||||||||||||
AR-67
|
234,371
|
222,554
|
435,500
|
950,373
|
1,075,141
|
2,801,368
|
7,062,218
|
|||||||||||||||||||||
AR-42
|
88,451
|
164,028
|
125,888
|
485,725
|
541,066
|
2,263,440
|
3,044,262
|
|||||||||||||||||||||
Unallocated
R&D
|
319,006
|
243,199
|
1,089,587
|
1,394,138
|
1,828,526
|
1,883,139
|
5,079,846
|
|||||||||||||||||||||
Total
|
$
|
927,894
|
$
|
1,106,682
|
$
|
3,058,023
|
$
|
4,343,580
|
$
|
5,444,202
|
$
|
9,768,389
|
$
|
21,535,711
|
|
·
|
the
number of trials and studies in a clinical
program;
|
|
·
|
the
number of patients who participate in the
trials;
|
|
·
|
the
number of sites included in the
trials;
|
|
·
|
the
rates of patient recruitment and
enrollment;
|
|
·
|
the
duration of patient treatment and
follow-up;
|
|
·
|
the
costs and timing of manufacturing our drug candidates;
and
|
|
·
|
the
costs, requirements, timing of, and the ability to secure regulatory
approvals.
|
Liquidity and capital resources
|
September 30,
2010
|
December 31,
2009
|
September 30,
2009
|
|||||||||
Cash
and cash equivalents
|
$ | 13,844 | $ | 3,087 | $ | 4,370 | ||||||
Working
capital
|
$ | 12,262 | $ | 1,506 | $ | 2,673 | ||||||
Stockholders'
equity
|
$ | 9,008 | $ | 1,576 | $ | 2,907 |
Nine Months Ended
September 30,
|
Year Ended
|
|||||||||||
Cash flow data
|
2010
|
2009
|
December 31,
2009
|
|||||||||
Cash
provided by (used in):
|
||||||||||||
Operating
activities
|
$ | (3,111 | ) | $ | (6,027 | ) | $ | (7,310 | ) | |||
Investing
activities
|
- | - | - | |||||||||
Financing
activities
|
13,868 | 3 | 3 | |||||||||
Net
increase (decrease) in cash and cash equivalents
|
$ | 10,757 | $ | (6,024 | ) | $ | (7,307 | ) |
|
·
|
the
progress of our research
activities;
|
·
|
the costs of hiring additional
full-time
personnel;
|
|
·
|
the
number and scope of our research
programs;
|
|
·
|
the
progress of our pre-clinical and clinical development
activities;
|
|
·
|
the
costs and timing of manufacturing our drug
candidates;
|
|
·
|
the
progress of the development efforts of parties with whom we have entered
into research and development
agreements;
|
|
·
|
our
ability to maintain current research and development programs and to
establish new research and development and licensing arrangements;
and
|
|
·
|
the
cost involved in prosecuting and enforcing patent claims and other
intellectual property rights; and the cost and timing of regulatory
approvals.
|
Product
Candidate
|
Indications
|
Commercial
Rights
|
Ongoing Studies / Status
|
|||
AR-12
|
Solid
tumors and hematological malignancies
|
Arno
|
A
two part, multi-centered Phase I clinical trial of AR-12 is ongoing in
patients with solid tumors and lymphoma who have progressed despite
treatment with other therapies.
|
|||
AR-42
|
Hematological
malignancies
|
Arno
|
Investigator
initiated Phase I/IIa clinical study of AR-42 is ongoing at The James
Cancer Center at The Ohio State University in patients with advanced or
recurrent hematological malignancies for which no treatment is
available.
|
|||
AR-67
|
Glioblastoma
multiforme (GBM)
|
Arno
|
A
two-cohort, multi-center Phase II clinical trial is ongoing in patients
with GBM that have progressed with other therapies. The first cohort
will enroll up to 26 patients who experienced rapid progression after
treatment with bevacizumab (Avastin®,Roche).
The second cohort will enroll up to 32 patients who have not been treated
with Avastin within the last 90
days.
|
|
·
|
our
ability to develop novel compounds with attractive pharmaceutical
properties and to secure and protect intellectual property rights based on
our innovations;
|
|
·
|
the
efficacy, safety and reliability of our drug
candidates;
|
|
·
|
the
speed at which we develop our drug
candidates;
|
|
·
|
our
ability to design and successfully complete appropriate clinical
trials;
|
|
·
|
our
ability to maintain a good relationship with regulatory
authorities;
|
|
·
|
the
timing and scope of regulatory
approvals;
|
|
·
|
our
ability to manufacture and sell commercial quantities of future products
to the market; and
|
|
·
|
acceptance
of future products by physicians and other healthcare
providers.
|
|
·
|
completion
of extensive pre-clinical laboratory tests, pre-clinical animal studies
and formulation studies, all performed in accordance with the FDA’s good
laboratory practice regulations and other
regulations;
|
|
·
|
submission
to the FDA of an IND application, which must become effective before
clinical trials may begin;
|
|
·
|
performance
of multiple adequate and well-controlled clinical trials meeting FDA
requirements to establish the safety and efficacy of the product candidate
for each proposed indication;
|
|
·
|
submission
of a new drug application, or NDA, to the
FDA;
|
|
·
|
satisfactory
completion of an FDA pre-approval inspection of the manufacturing
facilities at which the product candidate is produced, and potentially
other involved facilities as well, to assess compliance with current good
manufacturing practice, or cGMP, regulations and other applicable
regulations; and
|
|
·
|
FDA
review and approval of the NDA prior to any commercial marketing, sale or
shipment of the drug.
|
|
·
|
Phase I clinical trials
are initially conducted in a limited population to test the drug
candidate for safety, dose tolerance, absorption, metabolism, distribution
and excretion in healthy humans or, on occasion, in patients, such as
cancer patients. In some cases, particularly in cancer trials, a sponsor
may decide to conduct what is referred to as a “Phase Ib” evaluation,
which is a second safety-focused Phase I clinical trial typically designed
to evaluate the impact of the drug candidate in combination with currently
FDA-approved drugs or in a particular patient
population.
|
|
·
|
Phase II clinical trials
are generally conducted in a limited patient population to identify
possible adverse effects and safety risks, to determine the efficacy of
the drug candidate for specific targeted indications and to determine dose
tolerance and optimal dosage. Multiple Phase II clinical trials may be
conducted by the sponsor to obtain information prior to beginning larger
and more expensive Phase III clinical trials. In some cases, a sponsor may
decide to conduct what is referred to as a “Phase IIb” evaluation, which
is a second, confirmatory Phase II clinical trial that could, if accepted
by the FDA, serve as a pivotal clinical trial in the approval of a drug
candidate.
|
|
·
|
Phase III clinical trials
are commonly referred to as pivotal trials. When Phase II clinical
trials demonstrate that a dose range of the drug candidate is effective
and has an acceptable safety profile, Phase III clinical trials are
undertaken in large patient populations to further evaluate dosage, to
provide substantial evidence of clinical efficacy and to further test for
safety in an expanded and diverse patient population at multiple,
geographically dispersed clinical trial
sites.
|
|
·
|
Priority Review. As
explained above, a drug candidate may be eligible for a six-month priority
review. The FDA assigns priority review status to an application if the
drug candidate provides a significant improvement compared to marketed
drugs in the treatment, diagnosis or prevention of a disease. A fast track
drug would ordinarily meet the FDA’s criteria for priority review, but may
also be assigned a standard review. We do not know whether any of our drug
candidates will be assigned priority review status or, if priority review
status is assigned, whether that review or approval will be faster than
conventional FDA procedures, or that the FDA will ultimately approve the
drug.
|
|
·
|
Accelerated Approval.
Under the FDA’s accelerated approval regulations, the FDA is
authorized to approve drug candidates that have been studied for their
safety and efficacy in treating serious or life-threatening illnesses and
that provide meaningful therapeutic benefit to patients over existing
treatments based upon either a surrogate endpoint that is reasonably
likely to predict clinical benefit or on the basis of an effect on a
clinical endpoint other than patient survival or irreversible morbidity.
In clinical trials, surrogate endpoints are alternative measurements of
the symptoms of a disease or condition that are substituted for
measurements of observable clinical symptoms. A drug candidate approved on
this basis is subject to rigorous post-marketing compliance requirements,
including the completion of Phase IV or post-approval clinical trials to
validate the surrogate endpoint or confirm the effect on the clinical
endpoint. Failure to conduct required post-approval studies with due
diligence, or to validate a surrogate endpoint or confirm a clinical
benefit during post-marketing studies, may cause the FDA to seek to
withdraw the drug from the market on an expedited basis. All promotional
materials for drug candidates approved under accelerated regulations are
subject to prior review by the FDA.
|
Name
|
Age
|
Positions
|
||
Arie
S. Belldegrun, M.D.
|
61
|
Chairman
of the Board
|
||
David
M. Tanen
|
39
|
President,
Secretary and Director
|
||
J.
Chris Houchins
|
47
|
Chief
Operating Officer
|
||
Scott
L. Navins
|
39
|
Treasurer
|
||
Stefan
Proniuk, Ph.D.
|
40
|
Senior
Director of Product Development
|
||
William
F. Hamilton, Ph.D.
|
70
|
Director
|
||
49
|
Director
|
|||
Peter
M. Kash
|
49
|
Director
|
||
Yacov
Reizman
|
59
|
Director
|
||
Steven
B. Ruchefsky
|
|
48
|
|
Director
|
Committee
|
Membership
|
|
Audit
|
Dr.
Hamilton (Chair) and Mr. Ruchefsky
|
|
Compensation
|
Dr.
Belldegrun, Mr. Kariv, Mr. Reizman and Mr. Ruchefsky
|
|
Nominating
& Governance
|
Dr.
Hamilton, Mr. Reizman and Mr.
Ruchefsky
|
Name and
Principal Position
|
Year
|
Salary
|
Bonus
|
Option
Awards (1)
|
All Other
Compensation
|
Total
|
||||||||||||||||
David
M. Tanen (2)
|
2010
|
$ | – | $ | – | $ | – | $ | – | $ | – | |||||||||||
President
|
2009
|
$ | – | $ | – | $ | – | $ | – | $ | – | |||||||||||
J.
Chris Houchins
|
2010
|
$ | 209,756 | $ | 102,422 | $ | – | $ | – | $ | 312,178 | |||||||||||
Chief
Operating Officer
|
2009
|
$ | 207,573 | $ | 51,875 | $ | 182,300 | $ | – | $ | 441,748 |
(1)
|
Amounts
reflect the grant date fair value of awards granted under the Company’s
2005 Stock Option Plan, computed pursuant to Financial Accounting
Standards Board’s Accounting Standards Codification 718 “Compensation
– Stock Compensation”.
|
(2)
|
Mr.
Tanen was appointed President on June 8, 2009. Mr. Tanen, who also serves
as a director, does not receive compensation for his service as President,
but does receive compensation for his service as a director in accordance
with the terms of our non-employee director compensation plan. See
“—Director Compensation.”
|
Name
|
Number of
Securities
Underlying
Unexercised Options
Exercisable
|
Number of
Securities
Underlying
Unexercised Options
Unexercisable
|
Option Exercise
Price ($)
|
Option
Expiration Date
|
||||||||||||
Mr.
Tanen
|
6,666 | 3,334 | 1.00 | 9/29/19 | (1) | |||||||||||
– | 10,000 | 1.00 | 11/5/20 | (2) | ||||||||||||
Mr.
Houchins
|
83,074 | 16,615 | 2.00 | 9/17/17 | (3) | |||||||||||
66,667 | 133,333 | 1.00 | 9/29/19 | (4) |
(1)
|
Option
granted on September 29, 2009, as compensation for Mr. Tanen’s services as
a director prior to his appointment as our President. The option
vests in three equal installments on each anniversary of the date of
grant.
|
(2) | Option granted November 5, 2010 and vests in three equal annual installments commencing on the first anniversary of the grant date. |
(3)
|
Option
granted September 17, 2007 relating to an aggregate of 99,688 shares, of
which 25% vested on the first anniversary of the grant date and the
remainder vests in 36 equal monthly installments
thereafter.
|
(4)
|
Option
granted September 29, 2009 and vests in three equal annual installments
commencing on the first anniversary of the grant
date.
|
Name
|
Fees earned or
paid in cash
|
Option
Awards (1)
|
Total
|
|||||||||
Arie
S. Belldegrun, M.D.
|
$ | 43,000 | $ | 106,300 | (2) | $ | 149,300 | |||||
Robert
I. Falk (3)
|
$ | 21,750 | $ | 3,400 | (4) | $ | 25,150 | |||||
William
F. Hamilton, Ph.D.
|
$ | 33,000 | $ | 3,300 | $ | 36,300 | ||||||
Tomer
Kariv
|
$ | 6,250 | $ | 9,900 | $ | 16,150 | ||||||
Peter
M. Kash
|
$ | 25,000 | $ | 3,300 | $ | 28,300 | ||||||
Joshua
A. Kazam (3)
|
$ | 18,750 | $ | – | $ | 18,750 | ||||||
Yacov
Reizman
|
$ | 6,250 | $ | 9,900 | $ | 16,150 | ||||||
Steven
B. Ruchefsky
|
$ | 6,250 | $ | 9,900 | $ | 16,150 | ||||||
David
M. Tanen
|
$ | 25,000 | $ | 3,300 | $ | 28,300 |
|
(1)
|
Amounts
reflect the grant date fair value of awards granted under the Company’s
2005 Stock Option Plan, computed pursuant to Financial Accounting
Standards Board’s Accounting Standards Codification 718 “Compensation
– Stock Compensation”.
|
|
(2)
|
In
addition to the compensation paid to Dr. Belldegrun pursuant to our
non-employee director compensation plan for his service in 2010,
on September 9, 2010, Dr. Belldegrun was granted a fully vested,
ten-year stock option to purchase 300,000 shares of our common stock at an
exercise price of $1.00.
|
(3) |
Messrs.
Falk and Kazam resigned as directors in September 2010 upon the completion
of our private placement of Series A Preferred
Stock.
|
|
(4) |
On
September 9, 2010, Mr. Falk was granted a fully vested, ten-year stock
option to purchase 10,000 shares of our common stock at an exercise price
of $1.00.
|
Name of Beneficial Owner
|
No. Shares of
Common Stock
Beneficially Owned (1)
|
Percent of
Class (1)
|
No. Shares of
Series A
Preferred Stock
Beneficially Owned (2)
|
Percent of
Class (2)
|
||||||||||||
Arie
S. Belldegrun, M.D. (3)
|
1,342,251 | 3.7 | 750,000 | 4.9 | ||||||||||||
David
M. Tanen (4)
|
1,629,920 | 4.6 | 165,152 | 1.1 | ||||||||||||
J.
Chris Houchins (5)
|
149,741 | * | — | — | ||||||||||||
William
F. Hamilton, Ph.D. (6)
|
29,938 | * | — | — | ||||||||||||
Tomer
Kariv (7)
|
4,500,000 | 12.1 | 4,500,000 | 26.8 | ||||||||||||
Peter
M. Kash (8)
|
2,035,177 | 5.7 | 339,534 | 2.2 | ||||||||||||
Yacov
Reizman (9)
|
756,300 | 2.1 | 756,300 | 4.8 | ||||||||||||
Steven
B. Ruchefsky (10)
|
3,300,000 | 9.0 | 3,300,000 | 20.2 | ||||||||||||
All
current executive officers and directors as a group (9
persons)
|
13,992,859 | 34.9 | 9,910,986 | 52.3 | ||||||||||||
Pontifax
Ltd. (7)
|
4,500,000 | 12.1 | 4,500,000 | 26.8 | ||||||||||||
UTA
Capital LLC (11)
|
3,000,000 | 8.2 | 3,000,000 | 18.4 | ||||||||||||
100
Executive Drive, Ste. 330
|
||||||||||||||||
West
Orange, NJ 07052
|
||||||||||||||||
Commercial
Street Capital, LLC (10)
|
3,300,000 | 9.0 | 3,300,000 | 20.2 | ||||||||||||
800
Westchester Ave.
|
||||||||||||||||
Rye
Brook, NY 10573
|
||||||||||||||||
Clal
Insurance Co. Ltd. (12)
|
3,104,727 | 8.6 | 1,650,000 | 10.4 | ||||||||||||
48
Menachem Begin St.
|
||||||||||||||||
Tel-Aviv
66180, Israel
|
||||||||||||||||
Wexford
Capital LP (13)
|
3,865,789 | 10.6 | 1,860,000 | 11.7 | ||||||||||||
411
West Putnam Ave.
|
||||||||||||||||
Greenwich,
CT 06830
|
(1)
|
Assumes
35,686,024 shares of our common stock are outstanding, including
15,274,000 shares issuable upon the conversion of our Series A Preferred
Stock, but does not include any shares issuable upon the exercise of
outstanding warrants and options to purchase shares of our capital
stock. Beneficial ownership is determined in accordance with Rule
13d-3 under the Securities Act, and includes any shares as to which the
security or stockholder has sole or shared voting power or investment
power, and also any shares which the security or stockholder has the right
to acquire within 60 days of the date hereof, whether through the exercise
or conversion of any stock option, convertible security, warrant or other
right. The indication herein that shares are beneficially owned is
not an admission on the part of the security or stockholder that he, she
or it is a direct or indirect beneficial owner of those
shares.
|
(2)
|
Based upon 15,274,000 shares of
Series A Preferred Stock outstanding, excluding warrants to purchase
8,693,930 shares of Series A Preferred
Stock.
|
(3)
|
Common stock beneficially
owned include (i) 61,916 shares held in a trust of which Dr. Belldegrun is
a beneficiary, and (ii) 506,043 shares issuable upon exercise of stock
options. Series A Preferred Stock beneficially owned includes (i)
187,500 shares held in a family trust for which Dr. Belldegrun is a
co-trustee, including 62,500 shares issuable upon the exercise of
warrants, (ii) 375,000 shares held in a trust of which Dr. Belldegrun is a
beneficiary, including 125,000 shares issuable upon the exercise of
warrants, and (iii) 187,500 shares held in a family limited partnership of
which Dr. Belldegrun is a
partner.
|
(4)
|
Common stock beneficially
owned includes 149,532 shares held by Mr. Tanen’s minor children and 7,902
shares issuable upon the exercise of options and warrants held by Mr.
Tanen. Series A Preferred Stock beneficially owned includes 100,152
shares issuable upon the exercise of
warrants.
|
(5)
|
Represents shares issuable upon
the exercise of stock
options.
|
(6)
|
Includes 20,000 shares
issuable upon the exercise of stock
options.
|
(7)
|
Represents shares issuable
upon conversion of Series A Preferred Stock, including warrants to
purchase 1,500,000 shares of Series A Preferred Stock, all of which are
held by affiliates of Pontifax Ltd., of which Mr. Kariv is chief executive
officer.
|
(8)
|
Common stock beneficially
owned includes (i) 358,876 shares held by Mr. Kash’s minor children and
(ii) 9,138 shares issuable upon the exercise of stock options and warrants
held by Mr. Kash. Series A Preferred Stock beneficially owned
includes 239,534 shares issuable upon the exercise of
warrants.
|
(9)
|
Represents shares issuable
upon conversion of Series A Preferred Stock, including warrants to
purchase 456,300 shares of Series A Preferred Stock, all of which are held
by FCC Ltd., of which Mr. Reizman is chairman and chief executive
officer.
|
(10)
|
Represents shares issuable
upon conversion of Series A Preferred Stock, including warrants to
purchase 1,100,000 shares of Series A Preferred Stock, held by Commercial
Street Capital, LLC, of which Mr. Ruchefsky is
president.
|
(11)
|
Represents shares issuable
upon conversion of Series A Preferred Stock, including warrants to
purchase 1,000,000 shares of Series A Preferred
Stock.
|
(12)
|
Common stock beneficially
owned includes 1,650,000 shares of Series A Preferred Stock, including
550,000 shares of Series A Preferred Stock issuable upon the exercise of
warrants.
|
(13)
|
Common stock beneficially
owned represents: (i) 247,345 shares of our common stock held
by Kappa Investors, LLC (“Kappa”); (ii) a warrant held by Kappa to
purchase 24,734 shares of our common stock that are exercisable at $2.42
per share; and (iii) 1,733,712 shares of our common stock held by Wexford
Spectrum Investors LLC, a Delaware limited liability company ("Wexford
Spectrum"). Series A Preferred Stock beneficially owned represents
(i) 1,607,985 shares held by Wexford Spectrum, including 535,995 shares
issuable upon the exercise of warrants to purchase Series A Preferred
Stock, and (ii) 252,014 shares held by Kappa, including 84,005 shares
issuable upon the exercise of warrants. Wexford Capital LP, a
Delaware partnership (“Wexford Capital”), is a registered Investment
Advisor and also serves as an investment advisor or sub-advisor to the
members of Kappa and Wexford Spectrum. Wexford GP LLC (“Wexford GP”)
is the general partner of Wexford Capital. Mr. Charles E. Davidson
and Mr. Joseph M. Jacobs are each managing and controlling
members of Wexford
GP.
|
|
Page
|
|
Arno
Therapeutics, Inc. for the years ended December 31, 2009 and
2008:
|
||
Reports
of Independent Registered Public Accounting Firms
|
F-2
|
|
Balance
Sheets as of December 31, 2009 and 2008
|
F-4
|
|
Statements
of Operations for the years ended December 31, 2009 and 2008 and the
period from August 1, 2005 (Inception) through December 31,
2009
|
F-5
|
|
Statement
of Stockholders’ Equity (Deficiency) for the period from August 1, 2005
(Inception) through December 31, 2009
|
F-6
|
|
Statements
of Cash Flows for the years ended December 31, 2009 and 2008 and the
period from August 1, 2005(Inception) through December 31,
2009
|
F-7
|
|
Notes
to Financial Statements
|
F-9
|
|
Arno
Therapeutics, Inc. for the three and nine months ended September 30,
2010 and 2009 (Unaudited)
|
||
Condensed
Balance Sheets as of September 30, 2010 and December 31,
2009
|
F-25
|
|
Condensed
Statements of Operations for the three and nine months ended
September 30, 2010 and 2009 and the period from August 1, 2005 (Inception)
through September 30, 2010
|
F-26
|
|
Condensed
Statement of Stockholders’ Equity (Deficiency) for the period from August
1, 2005 (Inception) through September 30, 2010
|
F-27
|
|
Condensed
Statements of Cash Flows for the nine months ended September 30, 2010
and 2009 and the period from August 1, 2005 (Inception)
through September 30, 2010
|
F-28
|
|
Notes
to Condensed Financial Statements
|
F-29
|
/s/ Hays & Company
LLP
|
March 31,
2009
|
New
York, New York
|
December 31,
|
||||||||
2009
|
2008
|
|||||||
ASSETS
|
||||||||
Current
assets
|
||||||||
Cash
and cash equivalents
|
$ | 3,087,299 | $ | 10,395,007 | ||||
Prepaid
expenses
|
110,589 | 315,014 | ||||||
Total
current assets
|
3,197,888 | 10,710,021 | ||||||
Property
and equipment, net
|
41,567 | 63,584 | ||||||
Restricted
cash
|
44,018 | 44,018 | ||||||
Security
deposit
|
- | 12,165 | ||||||
Total
assets
|
$ | 3,283,473 | $ | 10,829,788 | ||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Current
liabilities
|
||||||||
Accounts
payable
|
$ | 1,003,030 | $ | 2,493,658 | ||||
Accrued
expenses
|
556,204 | 450,713 | ||||||
Due
to related party
|
132,418 | 5,616 | ||||||
Total
current liabilities
|
1,691,652 | 2,949,987 | ||||||
Deferred
rent
|
16,070 | 17,393 | ||||||
Total
liabilities
|
1,707,722 | 2,967,380 | ||||||
COMMITMENTS
AND CONTINGENCIES
|
||||||||
STOCKHOLDERS’
EQUITY
|
||||||||
Preferred
stock, $0.0001 par value; 20,000,000 shares authorized, 0 shares
issued and outstanding
|
- | - | ||||||
Common
stock, $0.0001 par value; 80,000,000 shares
authorized, 20,412,024 and 20,392,024 shares issued and
outstanding
|
2,041 | 2,039 | ||||||
Additional
paid-in capital
|
25,154,571 | 24,504,525 | ||||||
Deficit
accumulated during the development stage
|
(23,580,861 | ) | (16,644,156 | ) | ||||
Total
stockholders' equity
|
1,575,751 | 7,862,408 | ||||||
Total
liabilities and stockholders' equity
|
$ | 3,283,473 | $ | 10,829,788 |
Year ended December 31,
|
Period from
August 1, 2005
(inception) through
|
|||||||||||
2009
|
2008
|
December 31, 2009
|
||||||||||
Operating
expenses
|
||||||||||||
Research
and development
|
$ | 5,444,202 | $ | 9,768,389 | $ | 18,477,688 | ||||||
General
and administrative
|
1,520,648 | 2,315,178 | 4,201,235 | |||||||||
Total
operating expenses
|
6,964,850 | 12,083,567 | 22,678,923 | |||||||||
Loss
from operations
|
(6,964,850 | ) | (12,083,567 | ) | (22,678,923 | ) | ||||||
Other
income (expense)
|
||||||||||||
Interest
income
|
28,145 | 206,054 | 358,161 | |||||||||
Interest
expense
|
- | (1,036,053 | ) | (1,260,099 | ) | |||||||
Total
other income (expense)
|
28,145 | (829,999 | ) | (901,938 | ) | |||||||
Net
loss
|
$ | (6,936,705 | ) | $ | (12,913,566 | ) | $ | (23,580,861 | ) | |||
Net
loss per share - basic and diluted
|
$ | (0.34 | ) | $ | (0.81 | ) | ||||||
Weighted
average shares outstanding - basic and diluted
|
20,399,092 | 16,022,836 |
Common Stock
|
Additional
paid-in
|
Deficit
accumulated
during the
development
|
Total
stockholders'
equity
|
|||||||||||||||||
Shares
|
Amount
|
capital
|
stage
|
(deficiency)
|
||||||||||||||||
Issuance
of common stock to founders at $0.0001 per share
|
9,968,797 | $ | 997 | $ | 4,003 | $ | - | $ | 5,000 | |||||||||||
Stock
based compensation for services
|
- | - | 9,700 | - | 9,700 | |||||||||||||||
Net
loss, period from August 1, 2005 (inception) through December 31,
2006
|
- | - | - | (370,893 | ) | (370,893 | ) | |||||||||||||
Balance
at December 31, 2006
|
9,968,797 | 997 | 13,703 | (370,893 | ) | (356,193 | ) | |||||||||||||
Stock
based compensation for services
|
- | - | 88,300 | - | 88,300 | |||||||||||||||
Net
loss, year ended December 31, 2007
|
- | - | - | (3,359,697 | ) | (3,359,697 | ) | |||||||||||||
Balance
at December 31, 2007
|
9,968,797 | 997 | 102,003 | (3,730,590 | ) | (3,627,590 | ) | |||||||||||||
Common
stock sold in private placement, net of issuance costs of
$141,646
|
7,360,689 | 736 | 17,689,301 | - | 17,690,037 | |||||||||||||||
Conversion
of notes payable upon closing of private placement
|
1,962,338 | 196 | 4,278,322 | - | 4,278,518 | |||||||||||||||
Discount
arising from note conversion
|
- | - | 475,391 | - | 475,391 | |||||||||||||||
Warrants
issued in connection with note conversion
|
- | - | 348,000 | - | 348,000 | |||||||||||||||
Reverse
merger transaction - elimination of accumulated
deficit
|
- | - | (120,648 | ) | - | (120,648 | ) | |||||||||||||
Previously
issued Laurier common stock
|
1,100,200 | 110 | 120,538 | - | 120,648 | |||||||||||||||
Warrants
issued for services
|
- | - | 480,400 | - | 480,400 | |||||||||||||||
Stock
based compensation for services
|
- | - | 1,131,218 | - | 1,131,218 | |||||||||||||||
Net
loss, year ended December 31, 2008
|
- | - | - | (12,913,566 | ) | (12,913,566 | ) | |||||||||||||
Balance
at December 31, 2008
|
20,392,024 | 2,039 | 24,504,525 | (16,644,156 | ) | 7,862,408 | ||||||||||||||
Stock
based compensation for services
|
- | - | 647,448 | - | 647,448 | |||||||||||||||
Stock
option exercise
|
20,000 | 2 | 2,598 | - | 2,600 | |||||||||||||||
Net
loss, year ended December 31, 2009
|
- | - | - | (6,936,705 | ) | (6,936,705 | ) | |||||||||||||
Balance
at December 31, 2009
|
20,412,024 | $ | 2,041 | $ | 25,154,571 | $ | (23,580,861 | ) | $ | 1,575,751 |
Year ended December 31,
|
Period from
August 1, 2005
(inception) through
|
|||||||||||
2009
|
2008
|
December 31, 2009
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
loss
|
$ | (6,936,705 | ) | $ | (12,913,566 | ) | $ | (23,580,861 | ) | |||
Adjustments
to reconcile net loss to net cash used in operating
activities
|
||||||||||||
Depreciation
and amortization
|
19,337 | 45,467 | 77,913 | |||||||||
Stock
based compensation
|
647,448 | 1,131,218 | 1,876,666 | |||||||||
Write-off
of intangible assets
|
- | - | 85,125 | |||||||||
Warrants
issued for services
|
- | 480,400 | 480,400 | |||||||||
Warrants
issued in connection with note conversion
|
- | 348,000 | 348,000 | |||||||||
Note
discount arising from beneficial conversion feature
|
- | 475,391 | 475,391 | |||||||||
Deferred
rent
|
(1,323 | ) | 17,242 | 16,070 | ||||||||
Loss
on disposal of assets
|
2,680 | - | 2,680 | |||||||||
Non
cash interest expense
|
- | 98,930 | 311,518 | |||||||||
Changes
in operating assets and liabilities
|
||||||||||||
Prepaid
expenses
|
204,425 | (240,922 | ) | (110,589 | ) | |||||||
Restricted
cash
|
- | (44,018 | ) | (44,018 | ) | |||||||
Security
deposit
|
12,165 | - | - | |||||||||
Accounts
payable
|
(1,490,628 | ) | 2,382,184 | 1,003,030 | ||||||||
Accrued
expenses
|
105,491 | (669,315 | ) | 556,204 | ||||||||
Due
to related parties
|
126,802 | 5,033 | 132,418 | |||||||||
Net
cash used in operating activities
|
(7,310,308 | ) | (8,883,956 | ) | (18,370,053 | ) | ||||||
Cash
flows from investing activities
|
||||||||||||
Purchase
of equipment
|
- | (37,317 | ) | (77,160 | ) | |||||||
Cash
paid for intangible assets
|
- | - | (85,125 | ) | ||||||||
Proceeds
from related party advance
|
- | - | 525,000 | |||||||||
Repayment
of related party advance
|
- | - | (525,000 | ) | ||||||||
Net
cash used in investing activities
|
$ | - | $ | (37,317 | ) | $ | (162,285 | ) |
Year ended December 31,
|
Period from
August 1, 2005
(inception) through
|
|||||||||||
2009
|
2008
|
December 31, 2009
|
||||||||||
Cash
flows from financing activities
|
||||||||||||
Deferred
financing fees paid
|
$ | - | $ | (20,000 | ) | $ | (45,000 | ) | ||||
Proceeds
from issuance of common stock in private placement,
net
|
- | 17,690,037 | 17,690,037 | |||||||||
Proceeds
from issuance of common stock to founders
|
- | - | 5,000 | |||||||||
Proceeds
from issuance of notes payable
|
- | 1,000,000 | 1,000,000 | |||||||||
Repayment
of notes payable
|
- | (1,000,000 | ) | (1,000,000 | ) | |||||||
Proceeds
from issuance of convertible notes payable
|
- | - | 3,967,000 | |||||||||
Proceeds
from exercise of stock options
|
2,600 | - | 2,600 | |||||||||
Net
cash provided by financing activities
|
2,600 | 17,670,037 | 21,619,637 | |||||||||
Net
increase (decrease) in cash and cash equivalents
|
(7,307,708 | ) | 8,748,764 | 3,087,299 | ||||||||
Cash
and cash equivalents - beginning of period
|
10,395,007 | 1,646,243 | - | |||||||||
Cash
and cash equivalents - end of period
|
$ | 3,087,299 | $ | 10,395,007 | $ | 3,087,299 | ||||||
Supplemental
schedule of cash flows information
|
||||||||||||
Cash
paid for interest
|
$ | - | $ | 80,000 | $ | 80,000 | ||||||
Supplemental
disclosure of non-cash and financing activities
|
||||||||||||
Conversion
of notes payable and interest to common stock
|
$ | - | $ | 4,278,518 | $ | 4,278,518 | ||||||
Common
shares of Laurier issued in reverse merger
transaction
|
$ | - | $ | 110 | $ | 110 |
Description
|
Estimated useful life
|
|
Office
equipment and furniture
|
5
to 7 years
|
|
Leasehold
improvements
|
3
years
|
|
Computer
equipment
|
3
years
|
2009
|
2008
|
|||||||
Warrants
to purchase common stock
|
$ | 495,252 | $ | 495,252 | ||||
Options
to purchase common stock
|
1,913,241 | 2,436,511 | ||||||
Total
potential dilutive securities
|
$ | 2,408,493 | $ | 2,931,763 |
2009
|
2008
|
|||||||
Computer
equipment
|
$ | 5,080 | $ | 12,602 | ||||
Office
furniture and equipment
|
48,380 | 53,802 | ||||||
Leasehold
improvements
|
9,144 | 10,756 | ||||||
Total
property and equipment
|
62,604 | 77,160 | ||||||
Accumulated
depreciation
|
(21,037 | ) | (13,576 | ) | ||||
Total
property and equipment, net
|
$ | 41,567 | $ | 63,584 |
2009
|
2008
|
|||||||
Accrued
compensation and related benefits
|
$ | 250,800 | $ | 274,268 | ||||
Accrued
research and development expense
|
305,404 | 98,761 | ||||||
Accrued
other expenses
|
- | 77,684 | ||||||
Total
accrued liabilities
|
$ | 556,204 | $ | 450,713 |
Options Outstanding
|
||||||||||||||||
Shares
Available
for Grant
|
Outstanding
Stock
Options
|
Weighted-
average
exercise price
|
Aggregate
Intrinsic
Value
|
|||||||||||||
Balance
at January 1, 2008
|
2,302,806 | 687,849 | $ | 0.81 | ||||||||||||
Granted
under the Plan
|
(1,748,662 | ) | 1,748,662 | 2.06 | ||||||||||||
Exercised
|
- | - | - | |||||||||||||
Surrendered/cancelled
|
- | - | - | |||||||||||||
Forfeited
|
- | - | - | |||||||||||||
Balance
at December 31, 2008
|
554,144 | 2,436,511 | 1.71 | $ | - | |||||||||||
Granted
under the Plan
|
(305,000 | ) | 305,000 | 1.00 | ||||||||||||
Exercised
|
- | (20,000 | ) | 0.13 | ||||||||||||
Surrendered/cancelled
|
- | - | - | |||||||||||||
Forfeited
|
808,270 | (808,270 | ) | (2.98 | ) | |||||||||||
Balance
at December 31, 2009
|
1,057,414 | 1,913,241 | $ | 1.76 | $ | - | ||||||||||
Exercisable
at December 31, 2009
|
1,278,507 | $ | 1.71 | $ | - |
2009
|
2008
|
|||||||
Term
|
5 - 10 Years
|
5 - 10 Years
|
||||||
Stock price | $1.00 | $2.42 - $3.00 | ||||||
Volatility
|
135 | % | 77 - 123 | % | ||||
Dividend
yield
|
0 | % | 0 | % | ||||
Risk-free
interest rate
|
2.3 - 3.5 | % | 1.5 - 3.2 | % | ||||
Forfeiture
rate
|
0 | % | 0 | % |
Year ended December 31,
|
Period from
August 1, 2005
(inception) through
|
|||||||||||
2009
|
2008
|
December 31, 2009
|
||||||||||
General
and administrative
|
$ | 270,293 | $ | 679,948 | $ | 773,526 | ||||||
Research
and development
|
377,155 | 451,270 | 1,103,140 | |||||||||
Total
|
$ | 647,448 | $ | 1,131,218 | $ | 1,876,666 |
Outstanding
|
Exercisable
|
|||||||||||||||||||||
Range of
Exercise
Prices
|
Shares
|
Weighted -
Average
Remaining
Contractual Life
|
Weighted -
Average
Exercise
Price
|
Total
Shares
|
Weighted -
Average
Exercise
Price
|
|||||||||||||||||
$ | 0.13 | 129,532 | 1.86 | $ | 0.13 | 129,532 | $ | 0.13 | ||||||||||||||
$ | 1.00 | 823,381 | 6.84 | 1.00 | 501,434 | 1.00 | ||||||||||||||||
$ | 2.42 | 428,661 | 7.61 | 2.42 | 387,124 | 2.42 | ||||||||||||||||
$ | 2.75 | 440,000 | 8.52 | 2.75 | 178,750 | 2.75 | ||||||||||||||||
$ | 3.00 | 91,667 | 4.28 | 3.00 | 81,667 | 3.00 | ||||||||||||||||
1,913,241 | 6.94 | $ | 1.76 | 1,278,507 | $ | 1.71 |
2009
|
2008
|
|||||||
Research
tax credit
|
$ | 1,015,000 | $ | 702,000 | ||||
Net
operating loss carry forwards
|
8,900,000 | 6,111,000 | ||||||
Stock
based compensation
|
735,000 | 528,000 | ||||||
Depreciation
and amortization
|
- | (6,000 | ) | |||||
Total
net deferred tax assets
|
10,650,000 | 7,335,000 | ||||||
Valuation
allowance
|
(10,650,000 | ) | (7,335,000 | ) | ||||
Net
deferred tax assets
|
$ | - | $ | - |
Year ended December 31,
|
||||
2010
|
$ | 144,000 | ||
2011
|
143,000 | |||
2012
|
143,000 | |||
2013
|
146,000 | |||
Total
|
$ | 576,000 |
September 30, 2010
|
December 31, 2009
|
|||||||
(unaudited)
|
||||||||
ASSETS
|
||||||||
Current
assets
|
||||||||
Cash
and cash equivalents
|
$ | 13,844,124 | $ | 3,087,299 | ||||
Prepaid
expenses
|
74,054 | 110,589 | ||||||
Total
current assets
|
13,918,178 | 3,197,888 | ||||||
Property
and equipment, net
|
32,736 | 41,567 | ||||||
Restricted
cash
|
44,018 | 44,018 | ||||||
Total
assets
|
$ | 13,994,932 | $ | 3,283,473 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
Current
liabilities
|
||||||||
Accounts payable
|
$ | 272,127 | $ | 1,003,030 | ||||
Accrued expenses
and other current liabilities
|
1,257,637 | 556,204 | ||||||
Due
to related party
|
126,022 | 132,418 | ||||||
Total
current liabilities
|
1,655,786 | 1,691,652 | ||||||
Warrant
liability
|
3,315,927 | - | ||||||
Deferred
rent
|
15,078 | 16,070 | ||||||
Total
liabilities
|
4,986,791 | 1,707,722 | ||||||
Commitments
and contingencies
|
||||||||
Stockholders'
equity
|
||||||||
Preferred
stock, $0.0001 par value, 35,000,000 shares
authorized,
|
||||||||
15,162,000
and 0 shares issued and outstanding
|
1,516 | - | ||||||
Common
stock, $0.0001 par value, 80,000,000 shares
authorized,
|
||||||||
20,412,024 shares
issued and outstanding
|
2,041 | 2,041 | ||||||
Additional
paid-in capital
|
35,916,151 | 25,154,571 | ||||||
Deficit
accumulated during the development stage
|
(26,911,567 | ) | (23,580,861 | ) | ||||
Total
stockholders' equity
|
9,008,141 | 1,575,751 | ||||||
Total
liabilities and stockholders' equity
|
$ | 13,994,932 | $ | 3,283,473 |
Three months ended September 30,
|
Nine months ended September 30,
|
Period from
August 1, 2005 (inception)
|
||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
through September 30, 2010
|
||||||||||||||||
Operating
expenses:
|
||||||||||||||||||||
Research
and development
|
$ | 927,894 | $ | 1,106,682 | $ | 3,058,023 | $ | 4,343,580 | $ | 21,535,711 | ||||||||||
General
and administrative
|
292,084 | 328,234 | 610,979 | 936,208 | 4,812,214 | |||||||||||||||
Total
operating expenses
|
1,219,978 | 1,434,916 | 3,669,002 | 5,279,788 | 26,347,925 | |||||||||||||||
Loss
from operations
|
(1,219,978 | ) | (1,434,916 | ) | (3,669,002 | ) | (5,279,788 | ) | (26,347,925 | ) | ||||||||||
Other
income (expense):
|
||||||||||||||||||||
Interest
income
|
4,151 | 1,172 | 7,569 | 27,369 | 365,730 | |||||||||||||||
Interest
expense
|
- | - | - | - | (1,260,099 | ) | ||||||||||||||
Other
income (expense)
|
(887 | ) | - | 330,727 | - | 330,727 | ||||||||||||||
Total
other income (expense)
|
3,264 | 1,172 | 338,296 | 27,369 | (563,642 | ) | ||||||||||||||
Net
loss
|
$ | (1,216,714 | ) | $ | (1,433,744 | ) | $ | (3,330,706 | ) | $ | (5,252,419 | ) | $ | (26,911,567 | ) | |||||
Preferred
stock dividends
|
$ | 45,358 | $ | - | $ | 45,358 | $ | - | ||||||||||||
Net
loss available to common stockholders
|
$ | (1,262,072 | ) | $ | (1,433,744 | ) | $ | (3,376,064 | ) | $ | (5,252,419 | ) | ||||||||
Net
loss per share - basic and diluted
|
$ | (0.06 | ) | $ | (0.07 | ) | $ | (0.17 | ) | $ | (0.26 | ) | ||||||||
Weighted-average
shares outstanding -basic and diluted
|
20,412,024 | 20,400,285 | 20,412,024 | 20,394,808 |
PREFERRED STOCK
|
COMMON STOCK
|
ADDITIONAL
PAID-IN
|
DEFICIT
ACCUMULATED
DURING THE
DEVELOPMENT
|
TOTAL
STOCKHOLDERS'
|
||||||||||||||||||||||||
SHARES
|
AMOUNT
|
SHARES
|
AMOUNT
|
CAPITAL
|
STAGE
|
EQUITY (DEFICIT)
|
||||||||||||||||||||||
Issuance
of common shares to founders at $0.0001 per share
|
- | $ | - | 9,968,797 | $ | 997 | $ | 4,003 | $ | - | $ | 5,000 | ||||||||||||||||
Stock
based compensation for services
|
- | - | - | - | 9,700 | - | 9,700 | |||||||||||||||||||||
Net
loss, period from August 1, 2005 (inception) through December 31,
2006
|
- | - | - | - | - | (370,893 | ) | (370,893 | ) | |||||||||||||||||||
Balance
at December 31, 2006
|
- | - | 9,968,797 | 997 | 13,703 | (370,893 | ) | (356,193 | ) | |||||||||||||||||||
Stock
based compensation for services
|
- | - | - | - | 88,300 | - | 88,300 | |||||||||||||||||||||
Net
loss, year ended December 31, 2007
|
- | - | - | - | - | (3,359,697 | ) | (3,359,697 | ) | |||||||||||||||||||
Balance
at December 31, 2007
|
- | - | 9,968,797 | 997 | 102,003 | (3,730,590 | ) | (3,627,590 | ) | |||||||||||||||||||
Common
stock sold in private placement, net of issuance costs of
$141,646
|
- | - | 7,360,689 | 736 | 17,689,301 | - | 17,690,037 | |||||||||||||||||||||
Conversion
of notes payable upon closing of private placement
|
- | - | 1,962,338 | 196 | 4,278,322 | - | 4,278,518 | |||||||||||||||||||||
Note
discount arising from note conversion
|
- | - | - | - | 475,391 | - | 475,391 | |||||||||||||||||||||
Warrants
issued in connection with note conversion
|
- | - | - | - | 348,000 | - | 348,000 | |||||||||||||||||||||
Reverse
merger transaction -
|
||||||||||||||||||||||||||||
elimination
of accumulated deficit
|
- | - | - | - | (120,648 | ) | - | (120,648 | ) | |||||||||||||||||||
previously
issued Laurier common stock
|
- | - | 1,100,200 | 110 | 120,538 | - | 120,648 | |||||||||||||||||||||
Warrants
issued for services
|
- | - | - | - | 480,400 | - | 480,400 | |||||||||||||||||||||
Stock
based compensation for services
|
- | - | - | - | 1,131,218 | - | 1,131,218 | |||||||||||||||||||||
Net
loss, year ended December 31, 2008
|
(12,913,566 | ) | (12,913,566 | ) | ||||||||||||||||||||||||
Balance
at December 31, 2008
|
- | - | 20,392,024 | 2,039 | 24,504,525 | (16,644,156 | ) | 7,862,408 | ||||||||||||||||||||
Stock
based compensation for services
|
- | - | - | - | 647,448 | - | 647,448 | |||||||||||||||||||||
Stock
option exercise
|
- | - | 20,000 | 2 | 2,598 | - | 2,600 | |||||||||||||||||||||
Net
loss, year ended December 31, 2009
|
(6,936,705 | ) | (6,936,705 | ) | ||||||||||||||||||||||||
Balance
at December 31, 2009
|
- | - | 20,412,024 | 2,041 | 25,154,571 | (23,580,861 | ) | 1,575,751 | ||||||||||||||||||||
Stock
based compensation for services
|
- | - | - | - | 210,703 | - | 210,703 | |||||||||||||||||||||
Convertible
preferred units issued in private placement, net of issuance costs of
$1,293,680
|
15,162,000 | 1,516 | - | - | 13,403,384 | - | 13,404,900 | |||||||||||||||||||||
Warrants
issued in connection with convertible preferred units in private
placement
|
- | - | - | - | (3,315,927 | ) | - | (3,315,927 | ) | |||||||||||||||||||
Warrants
issued to placement agents in connection with private
placement
|
- | - | - | - | 463,420 | - | 463,420 | |||||||||||||||||||||
Net
loss, nine months ended September 30, 2010
|
- | - | - | - | - | (3,330,706 | ) | (3,330,706 | ) | |||||||||||||||||||
Balance
at September 30, 2010
|
15,162,000 | $ | 1,516 | 20,412,024 | $ | 2,041 | $ | 35,916,151 | $ | (26,911,567 | ) | $ | 9,008,141 |
Nine months ended September 30,
|
Period from
August 1, 2005 (inception)
|
|||||||||||
2010
|
2009
|
through September 30, 2010
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
loss
|
$ | (3,330,706 | ) | $ | (5,252,419 | ) | $ | (26,911,567 | ) | |||
Adjustment
to reconcile net loss to net cash used in operating
activities
|
||||||||||||
Depreciation
and amortization
|
8,831 | 12,911 | 86,744 | |||||||||
Stock-based
compensation
|
210,703 | 294,703 | 2,087,369 | |||||||||
Write-off
of intangible assets
|
- | - | 85,125 | |||||||||
Warrants
issued for services
|
- | - | 480,400 | |||||||||
Warrants
issued in connection with note conversion
|
- | - | 348,000 | |||||||||
Note
discount arising from beneficial conversion feature
|
- | - | 475,391 | |||||||||
Deferred
rent
|
(992 | ) | (992 | ) | 15,078 | |||||||
Loss
on disposal of assets
|
- | 2,779 | 2,680 | |||||||||
Noncash
interest expense
|
- | - | 311,518 | |||||||||
Changes
in operating assets and liabilities
|
||||||||||||
Prepaid
expenses
|
36,535 | 156,168 | (74,054 | ) | ||||||||
Restricted
cash
|
- | - | (44,018 | ) | ||||||||
Security
deposit
|
- | 12,165 | - | |||||||||
Accounts
payable
|
(730,903 | ) | (1,103,013 | ) | 272,127 | |||||||
Accrued
expenses
|
701,433 | (200,034 | ) | 1,257,637 | ||||||||
Due
to related party
|
(6,396 | ) | 50,458 | 126,022 | ||||||||
Net
cash used in operating activities
|
(3,111,495 | ) | (6,027,274 | ) | (21,481,548 | ) | ||||||
Cash
flows from investing activities
|
||||||||||||
Purchase
of property and equipment
|
- | - | (77,160 | ) | ||||||||
Cash
paid for intangible assets
|
- | - | (85,125 | ) | ||||||||
Proceeds
from related party advance
|
- | - | 525,000 | |||||||||
Repayment
of related party advance
|
- | - | (525,000 | ) | ||||||||
Net
cash used in investing activities
|
- | - | (162,285 | ) | ||||||||
Cash
flows from financing activities
|
||||||||||||
Deferred
financing fees paid
|
- | - | (45,000 | ) | ||||||||
Proceeds
from issuance of preferred stock in private placement,
net
|
13,868,320 | - | 13,868,320 | |||||||||
Proceeds
from issuance of common stock in private placement,
net
|
- | - | 17,690,037 | |||||||||
Proceeds
from issuance of common stock to founders
|
- | - | 5,000 | |||||||||
Proceeds
from issuance of notes payable
|
- | - | 1,000,000 | |||||||||
Repayment
of notes payable
|
- | - | (1,000,000 | ) | ||||||||
Proceeds
from issuance of convertible notes payable
|
- | - | 3,967,000 | |||||||||
Proceeds
from exercise of stock options
|
- | 2,600 | 2,600 | |||||||||
Net
cash provided by financing activities
|
13,868,320 | 2,600 | 35,487,957 | |||||||||
Net
(decrease) increase in cash and cash equivalents
|
10,756,825 | (6,024,674 | ) | 13,844,124 | ||||||||
Cash
and cash equivalents at beginning of period
|
3,087,299 | 10,395,007 | - | |||||||||
Cash
and cash equivalents at end of period
|
$ | 13,844,124 | $ | 4,370,333 | $ | 13,844,124 | ||||||
Supplemental
schedule of cash flows information:
|
||||||||||||
Cash
paid for interest
|
$ | - | $ | - | $ | 80,000 | ||||||
Supplemental
schedule of non-cash investing and financing
activities:
|
||||||||||||
Conversion
of notes payable and interest to common stock
|
$ | - | $ | - | $ | 4,278,518 | ||||||
Common
shares of Laurier issued in reverse merger transaction
|
$ | - | $ | - | $ | 110 | ||||||
Issuance
of warrants in connection with private placement of convertible preferred
units
|
$ | 3,315,927 | $ | - | $ | 3,315,927 |
For the Three Months Ended September 30,
|
For the Nine Months Ended September 30,
|
|||||||||||||||||||||||||||||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
|||||||||||||||||||||||||||||||||||||||||||||
Loss
|
Shares
|
Per Share
|
Loss
|
Shares
|
Per Share
|
Loss
|
Shares
|
Per Share
|
Loss
|
Shares
|
Per Share
|
|||||||||||||||||||||||||||||||||||||
(Numerator)
|
(Denominator)
|
Amount
|
(Numerator)
|
(Denominator)
|
Amount
|
(Numerator)
|
(Denominator)
|
Amount
|
(Numerator)
|
(Denominator)
|
Amount
|
|||||||||||||||||||||||||||||||||||||
Net
loss
|
$ | (1,216,714 | ) | $ | (1,433,744 | ) | $ | (3,330,706 | ) | $ | (5,252,419 | ) | ||||||||||||||||||||||||||||||||||||
Less:
Preferred stock dividends
|
(45,358 | ) | - | (45,358 | ) | - | ||||||||||||||||||||||||||||||||||||||||||
Basic
and Diluted EPS
|
||||||||||||||||||||||||||||||||||||||||||||||||
Loss
available to common stockholders
|
$ | (1,262,072 | ) | 20,412,024 | $ | (0.06 | ) | $ | (1,433,744 | ) | $ | 20,400,285 | $ | (0.07 | ) | $ | (3,376,064 | ) | 20,412,024 | $ | (0.17 | ) | $ | (5,252,419 | ) | $ | 20,394,808 | $ | (0.26 | ) |
September 30, 2010
|
September 30, 2009
|
|||||||
Warrants
to purchase common stock
|
9,127,087
|
495,252
|
||||||
Options
to purchase common stock
|
1,763,303
|
1,937,161
|
||||||
Convertible
preferred stock
|
15,162,000
|
–
|
||||||
Total
potentially dilutive securities
|
26,052,390
|
2,432,413
|
Options Outstanding
|
||||||||||||||||
Shares
|
Outstanding
|
Weighted-
|
Aggregate
|
|||||||||||||
Available for
|
Stock
|
Average
|
Intrinsic
|
|||||||||||||
Grant
|
Options
|
Exercise Price
|
Value
|
|||||||||||||
Balance
at January 1, 2010
|
1,057,414
|
1,913,241
|
$
|
1.76
|
||||||||||||
Options
granted under the Plan
|
(310,000)
|
310,000
|
$
|
1.00
|
||||||||||||
Options
exercised
|
-
|
-
|
$
|
-
|
||||||||||||
Options
forfeited
|
459,938
|
(459,938
|
)
|
$
|
2.72
|
|||||||||||
Balance
at September 30, 2010
|
1,207,352
|
1,763,303
|
$
|
1.39
|
$
|
60,250
|
||||||||||
Exercisable
at September 30, 2010
|
1,510,540
|
$
|
1.43
|
$
|
60,250
|
2010
|
2009
|
||||||
Term
|
5-10 Years
|
5 - 10 Years
|
|||||
Stock
price
|
$0.53 - $1.00 | $1.00 | |||||
Volatility
|
73 | % | 135 | % | |||
Dividend
yield
|
0 | % | 0 | % | |||
Risk-free
interest rate
|
1.6 | % | 2.3 – 2.5 | % | |||
Forfeiture
rate
|
0 | % | 0 | % |
Three months ended September 30,
|
Nine months ended September 30,
|
Period from
|
||||||||||||||||||
August 1, 2005 (inception)
|
||||||||||||||||||||
2010
|
2009
|
2010
|
2009
|
through September 30, 2010
|
||||||||||||||||
General
and administrative
|
$
|
112,700
|
$
|
112,902
|
$
|
109,703
|
$
|
90,307
|
$
|
1,086,292
|
||||||||||
Research
and development
|
31,700
|
18,102
|
101,000
|
204,396
|
1,001,077
|
|||||||||||||||
Total
|
$
|
144,400
|
$
|
131,004
|
$
|
210,703
|
$
|
294,703
|
$
|
2,087,369
|
Outstanding
|
Exercisable
|
|||||||||||||||||||||
Range of
Exercise
Prices
|
Shares
|
Weighted-
Average
Remaining
Contractual Life
(in years)
|
Weighted-
Average
Exercise
Price
|
Total Shares
|
Weighted-
Average
Exercise
Price
|
|||||||||||||||||
$ | 0.13 | 129,532 | 1.1 | $ | 0.13 | 129,532 | $ | 0.13 | ||||||||||||||
1.00 | 1,113,443 | 7.3 | 1.00 | 887,264 | 1.00 | |||||||||||||||||
2.42 | 428,661 | 6.9 | 2.42 | 402,077 | 2.42 | |||||||||||||||||
3.00 | 91,667 | 3.5 | 3.00 | 91,667 | 3.00 | |||||||||||||||||
1,763,303 | 6.5 | $ | 1.39 | 1,510,540 | $ | 1.43 |
Amount
to be Paid
|
||||
SEC
registration fee
|
$ | 975 | ||
Legal
fees and expenses
|
50,000 | |||
Accounting
fees and expenses
|
20,000 | |||
Printing
and engraving and miscellaneous expenses
|
5,000 | |||
Total
|
$ | 75,975 |
Exhibit Number
|
Description of Document
|
|
2.1
|
Agreement
and Plan of Merger dated March 5, 2008, by and among Laurier
International, Inc., Laurier Acquisition, Inc. and Arno Therapeutics, Inc.
(incorporated by reference to Exhibit 2.1 of the Registrant’s Form 8-K
filed on March 6, 2008).
|
|
2.2
|
Amendment
No. 1 dated May 12, 2008 to Agreement and Plan of Merger by and among
Laurier International, Inc., Laurier Acquisition, Inc. and Arno
Therapeutics, Inc. (incorporated by reference to Exhibit 2.2 of the
Registrant’s Registration Statement on Form S-1 filed July 31, 2008, SEC
File No. 333-152660).
|
|
2.3
|
Amendment
No. 2 dated May 30, 2008 to Agreement and Plan of Merger by and among
Laurier International, Inc., Laurier Acquisition, Inc. and Arno
Therapeutics, Inc. (incorporated by reference to Exhibit 2.3 of the
Registrant’s Registration Statement on Form S-1 filed July 31, 2008, SEC
File No. 333-152660).
|
|
3.1
|
Amended
& Restated Certificate of Incorporation of Arno Therapeutics, Inc.
(previously filed).
|
|
3.2
|
Bylaws
of the Registrant (incorporated by reference to Exhibit 3.2 of the
Registrant’s Registration Statement on Form SB-2 filed on October 2, 2002,
SEC File No. 333-100259).
|
|
3.3
|
Certificate
of Designation of Series A Convertible Preferred Stock (previously
filed).
|
|
4.1
|
Specimen
Common Stock Certificate (incorporated by reference to Exhibit 4.1 of the
Registrant’s Form 8-K filed June 9, 2008).
|
|
4.2
|
Form
of Common Stock Purchase Warrant issued to former note holders of Arno
Therapeutics, Inc. (incorporated by reference to Exhibit 4.2 of the
Registrant’s Form 8-K filed June 9, 2008).
|
|
4.3
|
Form
of Class A Warrant issued to investors in September 2010 private placement
(previously filed).
|
|
4.4
|
Form
of Class B Warrant issued to investors in September 2010 private placement
(previously filed).
|
|
4.5
|
Form
of Placement Agent Warrant issued in September 2010 private placement
(previously filed).
|
|
5.1
|
Opinion
of Fredrikson & Byron, P.A. (previously filed).
|
|
10.1
|
Employment
Agreement dated June 1, 2007 between Arno Therapeutics, Inc. and Scott Z.
Fields, M.D. (incorporated by reference to Exhibit 10.1 of the
Registrant’s Form 8-K filed June 9, 2008).
|
|
10.2
|
Letter
agreement dated September 12, 2007 between Arno Therapeutics, Inc. and J.
Chris Houchins (incorporated by reference to Exhibit 10.2 of the
Registrant’s Form 8-K filed June 9, 2008).
|
|
10.3
|
Arno
Therapeutics, Inc. 2005 Stock Option Plan (incorporated by reference to
Exhibit 10.3 of the Registrant’s Form 8-K filed June 9,
2008).
|
|
10.4
|
Form
of stock option agreement for use under Arno Therapeutics, Inc. 2005 Stock
Option Plan (incorporated by reference to Exhibit 10.4 of the Registrant’s
Form 8-K filed June 9, 2008).
|
|
10.5
|
License
Agreement dated October 25, 2006 between Arno Therapeutics, Inc. and The
University of Pittsburgh (incorporated by reference to Exhibit 10.5 of the
Registrant’s Form 8-K filed June 9, 2008).+
|
|
10.6
|
License
Agreement dated January 3, 2008 between Arno Therapeutics, Inc. and The
Ohio State University Research Foundation (incorporated by reference to
Exhibit 10.6 of the Registrant’s Form 8-K filed June 9,
2008).+
|
|
10.7
|
License
Agreement dated January 9, 2008 between Arno Therapeutics, Inc. and The
Ohio State University Research Foundation (incorporated by reference to
Exhibit 10.7 of the Registrant’s Form 8-K filed June 9,
2008).+
|
|
10.8
|
Form
of Subscription Agreement between Arno Therapeutics, Inc. and the
investors in the June 2, 2008 private placement (incorporated by reference
to Exhibit 10.8 of the Registrant’s Form 8-K filed June 9,
2008).
|
|
10.9
|
Employment
Agreement dated June 9, 2008 between Arno Therapeutics, Inc. and Brian
Lenz, as amended on July 9, 2008 (incorporated by reference to Exhibit
10.1 of the Registrant’s Form 10-Q for the quarter ended June 30,
2008).
|
|
10.10
|
Employment
Agreement by and between Arno Therapeutics, Inc. and Dr. Roger Berlin,
dated September 3, 2008 (incorporated by reference to Exhibit 10.1 of the
Registrant’s Form 8-K filed September 3, 2008).
|
|
10.11
|
Services
Agreement dated June 1, 2009, between Arno Therapeutics, Inc. and Two
River Consulting, LLC (previously filed).
|
|
10.12
|
Lease
Agreement by and between Arno Therapeutics, Inc. and Maple 4 Campus
L.L.C., dated October 17, 2008 (incorporated by reference to Exhibit 10.11
of the Registrant’s Form 10-K for the fiscal year ended December 31,
2008).
|
|
10.13
|
Form
of Securities Purchase and Registration Rights Agreement dated September
3, 2010 among Arno Therapeutics, Inc. and the purchasers identified
therein (previously filed).
|
|
10.14
|
First
Amendment to Services Agreement dated September 9, 2010, between Arno
Therapeutics, Inc. and Two River Consulting, LLC (previously
filed).
|
|
10.15
|
Letter
Agreement dated February 18, 2010 between Arno Therapeutics, Inc. and Two
River Consulting, LLC.
|
|
10.16
|
Letter
agreement dated August 26, 2010 between Arno Therapeutics, Inc. and J.
Chris Houchins.
|
|
23.1
|
Consent
of Crowe Horwath LLP
|
|
23.2
|
Consent
of Hays & Company LLP.
|
|
23.3
|
Consent
of Fredrikson & Byron, P.A. (included in Exhibit
5.1).
|
|
24.1
|
Power
of Attorney (previously
filed).
|
|
+
|
Confidential
treatment has been granted as to certain omitted portions of this exhibit
pursuant to Rule 406 of the Securities Act or Rule 24b-2 of the Exchange
Act.
|
|
(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;
|
|
(ii)
|
To
reflect in the prospectus any facts or events arising after the effective
date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the “Calculation of Registration
Fee” table in the effective registration statement;
and
|
|
(iii)
|
To
include any material information with respect to the plan of distribution
not previously disclosed in the registration statement or any material
change to such information in the registration
statement.
|
|
|
|
(2)
|
That,
for the purpose of determining any liability under the Securities Act,
each post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
the 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 that remain unsold at the termination of this
offering.
|
|
(4)
|
That,
for the purpose of determining liability under the Securities Act to any
purchaser, if the registrant is subject to Rule 430C, each prospectus
filed pursuant to Rule 424(b) as part of a registration
statement relating to an offering, other than registration statements
relying on Rule 430B or other than prospectuses filed in reliance on
Rule 430A, shall be deemed to be part of and included in the
registration statement as of the date it is first used after
effectiveness. Provided, however, that
no statement made in a registration statement or prospectus that is part
of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus
that is part of the registration statement will, as to a purchaser with a
time of contract of sale prior to such first use, supersede or modify any
statement that was made in the registration statement or prospectus that
was part of the registration statement or made in any such document
immediately prior to such date of first
use.
|
ARNO
THERAPEUTICS, INC.
|
||
By:
|
/s/
David M. Tanen
|
|
David
M. Tanen, President
|
Signature
|
Title
|
Date
|
||
/s/
David M. Tanen
|
President,
Secretary, and Director
|
January
18, 2011
|
||
David
M. Tanen
|
(Principal
Executive Officer)
|
|||
*
|
Treasurer
|
January
18, 2011
|
||
Scott
L. Navins
|
(Principal
Financial and Accounting Officer)
|
|||
*
|
Chairman
of the Board
|
January
18, 2011
|
||
Arie
S. Belldegrun, M.D.
|
||||
*
|
Director
|
January
18, 2011
|
||
William
F. Hamilton, Ph.D.
|
||||
|
Director
|
January
__, 2011
|
||
Tomer
Kariv
|
||||
*
|
Director
|
January
18, 2011
|
||
Peter
M. Kash
|
||||
*
|
Director
|
January
18, 2011
|
||
Yacov
Reizman
|
||||
*
|
Director
|
January
18, 2011
|
||
Steven
B. Ruchefsky
|
/s/
David M. Tanen
|
|
David
M. Tanen
|
|
Attorney-in-fact
|
Exhibit Number
|
Description of Document
|
|
10.15
|
Letter
Agreement dated February 18, 2010 between Arno Therapeutics, Inc. and Two
River Consulting, LLC.
|
|
10.16
|
Letter
agreement dated August 26, 2010 between Arno Therapeutics, Inc. and J.
Chris Houchins.
|
|
23.1
|
Consent
of Crowe Horwath LLP
|
|
23.2
|
Consent
of Hays & Company
LLP
|