Filed
pursuant to Rule 424(b)(5)
Registration
No. 333-220632
PROSPECTUS
SUPPLEMENT
|
(To
the Prospectus dated October 10, 2017)
|
Up
to $10,000,000 maximum aggregate offering price
of
Common Stock
We have entered into an equity distribution
agreement with Ladenburg Thalmann & Co. Inc. (“Ladenburg”), Barrington Research Associates, Inc. (“Barrington”)
and A.G.P./Alliance Global Partners (“AGP” and together with Ladenburg and Barrington, the “Agents”),
relating to shares of our common stock, par value $0.001 per share (the “Common Stock”), offered pursuant to this
prospectus supplement and the accompanying prospectus. In accordance with the terms of the equity distribution agreement, we may
offer and sell shares of our Common Stock having an aggregate offering price of up to $10,000,000 from time to time through
any of the Agents.
Our Common Stock is traded on The Nasdaq Capital
Market under the symbol “COCP.” On July 18, 2018, the last reported sale price of our Common Stock on The Nasdaq
Capital Market was $4.95 per share.
In
connection with the listing of our Common Stock on The Nasdaq Capital Market, we implemented a 1-for-30 reverse split of our issued
and outstanding shares of Common Stock on January 24, 2018. All share and per share data in this prospectus supplement have been
retroactively restated to reflect the reverse stock split. All share and per share data in the accompanying prospectus are presented
without restatement.
Sales
of our Common Stock, if any, under this prospectus supplement and the accompanying prospectus may be made by any method permitted
by law deemed to be an “at the market” offering as defined in Rule 415 of the Securities Act of 1933, as amended (the
“Securities Act”), including without limitation sales made directly on The Nasdaq Capital Market, on any other existing
trading market for the Common Stock or to or through a market maker. If specified by us, the Agents may also sell our Common Stock
by any other method permitted by law, including, but not limited to, in privately negotiated transactions. The Agents are not
required to sell any certain number of shares or dollar amount of our Common Stock, but will act as sales agents and use commercially
reasonable efforts to sell on our behalf all of the shares of Common Stock requested to be sold by us, consistent with their normal
trading and sales practices, subject to the terms of the equity distribution agreement. We also may sell shares of our Common
Stock to the Agents as principals for their own account at a price agreed upon at the time of sale. Under the terms of the equity
distribution agreement, the terms of any such sale will be set forth in writing, and we will describe these terms in a separate
prospectus supplement.
Under
the terms of the equity distribution agreement, each Agent will be entitled to compensation of up to 2.0% of the gross
proceeds from the sales of shares of Common Stock sold by it under the equity distribution agreement. In connection with the sale
of shares of our Common Stock on our behalf, each Agent will be deemed to be an “underwriter” within the meaning of
the Securities Act and the compensation of each Agent will be deemed to be underwriting commissions or discounts. Please see “Plan
of Distribution (Conflicts of Interest)” on page S-15 for further information relating to the compensation arrangements
for the Agents.
There
is no arrangement for funds to be received in any escrow, trust or similar arrangement.
Ladenburg
has a “conflict of interest” within the meaning of Financial Industry Regulatory Authority (“FINRA”) Rule
5121(f)(5)(B) in this offering because Dr. Phillip Frost beneficially owns more than 10% of our common equity and more than 10%
of the common equity of Ladenburg’s parent, Ladenburg Thalmann Financial Services, Inc. Dr. Frost is also a director of
ours and chairman of the board of Ladenburg Thalmann Financial Services, Inc. Due to this conflict of interest, Barrington Research
is acting as a “qualified independent underwriter” in accordance with FINRA Rule 5121, which requires, among other
things, that a qualified independent underwriter participate in the preparation of, and exercise the usual standards of “due
diligence” with respect to the registration statement and this prospectus supplement and the accompanying prospectus.
Investing
in our Common Stock involves a high degree of risk. Please read “Risk Factors” beginning on page S-5 of this prospectus
supplement, and in our Annual Report on Form 10-K for the year ended December 31, 2017 which is incorporated by reference into
this prospectus supplement.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary
is a criminal offense.
Ladenburg
Thalmann
|
|
Barrington
Research
|
A.G.P.
Offering
Securities Through Euro Pacific Capital, Inc.
The
date of this prospectus supplement is
July 19,
2018
ABOUT
THIS PROSPECTUS SUPPLEMENT
This
document is in two parts. The first part is this prospectus supplement, which describes
the terms of the offering and also adds to and updates information contained in the accompanying prospectus and the documents
incorporated by reference into this prospectus supplement and the accompanying prospectus. The second part consists of a prospectus
dated October 10, 2017, included in the registration statement on Form S-3
(No. 333-220632) that was initially filed on
September 26, 2017, as amended on October 5, 2017, with the Securities and Exchange Commission (“SEC”) and was declared
effective by the SEC on October 10, 2017. Since
the accompanying prospectus provides general
information about us, some of the information may not apply to this offering. This prospectus supplement describes the specific
details regarding this offering. Generally, when we refer to the “prospectus,” we are referring to both parts of this
document. Additional information is incorporated by reference in this prospectus supplement. If information in this prospectus
supplement is inconsistent with the accompanying prospectus, you should rely on this prospectus supplement. You should read this
prospectus supplement, the accompanying prospectus and any information incorporated by reference before you make any investment
decision.
Neither
we nor the Agents are making an offer to sell the securities in jurisdictions where the offer or sale is not permitted. The distribution
of this prospectus supplement and the accompanying prospectus and the offer and sale of our securities in certain jurisdictions
may be restricted by law. Persons outside the United States who come into possession of this prospectus supplement and the accompanying
prospectus must inform themselves about and observe any restrictions relating to the offering of the securities and the distribution
of this prospectus supplement and the accompanying prospectus outside the United States. This prospectus supplement and the accompanying
prospectus do not constitute an offer of, or an invitation to purchase, any shares of common stock in any jurisdiction in which
such offer or invitation would be unlawful.
You
should rely only on information contained in this prospectus supplement, t
he accompanying
prospectus and the documents we incorporate by reference in this prospectus supplement
. We have not authorized anyone to
provide you with information that is different from that contained in this prospectus supplement. We are not offering to sell
or seeking offers to buy shares of common stock in jurisdictions where offers and sales are not permitted. The information contained
in this prospectus supplement and the accompanying prospectus supplement is accurate only as of their respective dates, regardless
of the time of delivery of this prospectus or of any sale of our common stock.
Unless
otherwise mentioned or unless the context requires otherwise, all references in this prospectus to the “Company,”
“we,” “us,” “our” and “Cocrystal” refer to Cocrystal Pharma, Inc., a Delaware
corporation, and its consolidated subsidiaries.
To
the extent this prospectus supplement contains summaries of the documents referred to herein, you are directed to the actual documents
for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the
documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration
statement of which this prospectus supplement is a part, and you may obtain copies of those documents as described below under
the section entitled “Where You Can Find Additional Information.”
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus supplement and the accompanying prospectus, including documents incorporated by reference into this prospectus supplement
and the accompanying prospectus, contain “forward-looking statements” within the meaning of Section 27A of the Securities
Act of 1933 (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”).
Such forward-looking statements include those statements that express plans, anticipation, intent, contingency, goals, targets
or future development and/or otherwise are not statements of historical fact. Forward-looking statements can generally be identified
by the use of words such as “anticipate,” “expect,” “plan,” “could,” “may,”
“will,” “should,” “would,” “intend,” “seem,” “potential,”
“appear,” “continue,” “future,” believe,” “estimate,” “forecast,”
“project” and other words of similar meaning, although not all forward-looking statements contain these identifying
words. In particular, these forward-looking statements include, among others, statements about our intended use of proceeds, the
development and commercialization of broad-spectrum antiviral drug candidates and their success.
These
statements are based on our current expectations and projections and involve estimates, assumptions, risks and uncertainties that
could cause actual results to differ materially from those expressed in them. Any forward-looking statements are qualified in
their entirety by reference to the factors discussed in this prospectus supplement, and the accompanying prospectus, and the documents
incorporated by reference herein and therein. Important factors that could cause actual results to differ from those in the forward-looking
statements include our failure to generate revenue and unsuccessful or significant delays in the development or commercialization
of any of our product candidates. We also refer you to the Risk Factors which begin at page S-5 of this prospectus supplement
and our most recent Annual Report on Form 10-K for the year ended December 31, 2017, under the caption “Item 1A –
Risk Factors” of such report, and the other documents incorporated by reference into this prospectus supplement for both
an expanded discussion of the risks and uncertainties described above and additional risks and uncertainties that could cause
actual results to differ materially and adversely from those expressed or implied by forward-looking statements. However, factors
or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict
all of them.
You
should read this prospectus supplement, the accompanying prospectus and the documents that we reference herein and therein, completely
and with the understanding that our actual future results may be materially different from what we expect. You are cautioned not
to place undue reliance on the forward-looking statements contained in, or incorporated by reference into, this prospectus supplement.
Each forward-looking statement speaks only as of the date of this prospectus supplement or, in the case of documents incorporated
by reference, the date of the applicable document (or any earlier date indicated in the statement), and we undertake no obligation
to update or revise any of these statements, whether as a result of new information, future developments or otherwise, except
as required by law. We qualify all of our forward-looking statements by these cautionary statements.
PROSPECTUS
SUPPLEMENT SUMMARY
This
summary is not complete and does not contain all of the information that you should consider before investing in the securities
offered by this prospectus supplement and the accompanying prospectus. You should read this summary together with the entire prospectus
supplement and the accompanying prospectus, including our financial statements, the notes to those financial statements and the
other documents that are incorporated by reference in this prospectus supplement and the accompanying prospectus, before making
an investment decision. See “Risk Factors” beginning on page S-5 of this prospectus supplement for a discussion of
the risks involved in investing in our securities.
Our
Business
Cocrystal
is a biotechnology company seeking to discover and develop novel antiviral therapeutics as treatments for serious and/or chronic
viral diseases. Cocrystal employs unique structure based technologies and Nobel Prize winning expertise to create first- and best-in-class
antiviral drugs. These technologies, which leverage our nucleoside chemistry expertise, are designed to efficiently deliver small
molecule therapeutics that are safe, effective and convenient to administer. We have identified promising preclinical and early
clinical stage antiviral compounds for unmet medical needs including hepatitis, influenza and norovirus infections.
Cocrystal
Technology
We
are developing antiviral therapeutics that inhibit the essential replication function of a virus, including the RNA-dependent
RNA polymerase enzyme, the NS5A protein of hepatitis C (HCV), and the RNA-dependent RNA polymerases of influenza virus and norovirus.
To discover and design these inhibitors, we use a proprietary platform comprising computation, nucleoside and medicinal chemistry,
X-ray crystallography, and our extensive know-how. We determine the structures of cocrystals containing the inhibitors bound to
the enzyme or protein to guide our design. We also use advanced computational methods to screen and design product candidates
using proprietary cocrystal structural information. In designing the candidates, we seek to anticipate and avert potential viral
mutations leading to resistance. By designing and selecting drug candidates that interrupt the viral replication process and also
have specific binding characteristics, we seek to develop drugs that are not only effective against both the virus and possible
mutants of the virus, but which also have reduced off-target interactions that cause undesirable clinical side effects. While
this approach is easy to describe, it is much more difficult to carry out. In particular, an extensive knowledge of viruses and
drug targets is required. In addition, knowledge and experience in the fields of structural biology, enzymology, and chemistry
is required.
We
developed our proprietary structure-based drug design and antiviral chemistry under the guidance of Dr. Roger Kornberg, our Chief
Scientist and recipient of the Nobel Prize in Chemistry in 2006, and Dr. Raymond Schinazi, our Chairman and a world leader in
the area of nucleoside chemistry and a cofounder of several biotechnology companies focusing on antiviral drug discovery and development.
Our drug discovery process focuses on those parts of the enzymes to which drugs bind and on drug-enzyme interactions at the atomic
level. Additionally, we have developed proprietary targeted in-house chemical libraries of nucleosides, non-nucleoside inhibitors,
metal-binding inhibitors, and fragments. Our drug discovery process is different from traditional, empirical, medicinal chemistry
approaches that often require iterative high-throughput compound screening and lengthy hit-to-lead processes.
Product
Candidates
Hepatitis
C.
Our Hepatitis C Virus (“HCV”) Non-Nucleoside Polymerase Inhibitor CC-31244 is a potential best-in-class pan-genotypic
inhibitor of NS5B polymerase for the treatment of hepatitis C infection. It has the potential to be an important component in
an all-oral ultra-short HCV combination therapy. In Phase 1a/b clinical trials CC-31244 showed an acceptable safety profile in
both healthy volunteers and HCV-infected patients. There were no serious adverse events or discontinuations due to adverse events.
The mean HCV viral load reduction was 1,000-fold at 48 hours and there was a sustained post-treatment antiviral effect of a 100-fold
viral reduction after seven days following cessation of treatment. Recently, we received FDA clearance to initiate Phase 2a clinical
trials of CC-31244. We expect to receive topline data this year.
Influenza.
We have several preclinical candidates under development for the treatment of influenza infection. CC-42344, a novel PB2 inhibitor,
has been selected as a preclinical lead. This candidate binds to a highly conserved PB2 site of influenza polymerase complex (PB1:
PB2: PA), and exhibits a novel mechanism of action. CC-42344 showed excellent antiviral activity against influenza A strains,
including avian pandemic strains and Tamiflu resistant strains, and has favorable pharmacokinetic profiles. We plan to complete
preclinical IND-enabling studies and initiate Phase 1 study this year.
Norovirus
Infections.
We continue to identify and develop nucleoside and non-nucleoside polymerase inhibitors.
Corporate
Information
Our
executive offices and research facilities are located at 1860 Montreal Road, Tucker, Georgia 30084. Our telephone number is (678)
892-8800. We also conduct our principal research from offices located in Bothell, Washington. Our corporate website is www.cocrystalpharma.com.
Investors can obtain copies of our SEC filings from our corporate website free of charge, as well as from the SEC website, www.sec.gov.
Information contained on our corporate website does not constitute part of the prospectus supplement or the accompanying prospectus.
The
Offering
Issuer
|
|
Cocrystal Pharma, Inc.
|
|
|
|
Common Stock offered by us
|
|
Common Stock having an aggregate gross offering price of up
to $10,000,000 or up to 2,020,202 shares, assuming sales at a price of $4.95 per share, which was the closing price of
the Common Stock on The Nasdaq Capital Market on July 18, 2018. The actual number of shares issued in connection with this
offering will vary depending on how many shares of Common Stock we choose to sell and the prices at which such sales occur.
|
|
|
|
Common Stock outstanding after this offering
|
|
31,943,278 assuming sales at a price of $4.95 per share,
which was the closing price of the Common Stock on The Nasdaq Capital Market on July 18, 2018.
|
|
|
|
Manner of offering
|
|
Sales of our Common Stock, if any, under this prospectus supplement and the accompanying prospectus may be made by any method permitted by law deemed to be an “at the market” offering as defined in Rule 415 of the Securities Act, including without limitation sales made directly on The Nasdaq Capital Market, on any other existing trading market for the Common Stock or to or through a market maker. If specified by us, the Agents may also sell our Common Stock by any other method permitted by law, including, but not limited to, in privately negotiated transactions. The Agents are not required to sell any certain number of shares or dollar amount of our Common Stock, but will act as sales agents and use commercially reasonable efforts to sell on our behalf all of the shares of Common Stock requested to be sold by us, consistent with their normal trading and sales practices, subject to the terms of the equity distribution agreement. See “Plan of Distribution (Conflicts of Interest)” beginning on page S-15 of this prospectus supplement.
|
|
|
|
Use of proceeds
|
|
We intend to use the net proceeds from this offering for general corporate purposes and the continued development of novel medicines for use in the treatment of human viral diseases. See “Use of Proceeds” on page S-13 of this prospectus supplement.
|
|
|
|
Conflicts of Interest
|
|
Ladenburg has a “conflict of interest” within the meaning of FINRA Rule 5121(f)(5)(B) in this offering because Dr. Phillip Frost beneficially owns more than 10% of our common equity and more than 10% of the common equity of Ladenburg’s parent, Ladenburg Thalmann Financial Services, Inc. Dr. Frost is also a director of ours and chairman of the board of Ladenburg Thalmann Financial Services, Inc. Accordingly, this offering is being made in compliance with the applicable requirements of FINRA Rule 5121. FINRA Rule 5121 requires that a “qualified independent underwriter,” as defined in FINRA Rule 5121, participate in the preparation of the registration statement and prospectus and exercise the usual standards of due diligence with respect thereto. Barrington Research has agreed to act as a “qualified independent underwriter” for this offering. See “Plan of Distribution (Conflicts of Interest)” beginning on page S-15 of this prospectus supplement.
|
|
|
|
Nasdaq Capital Market symbol
|
|
“COCP”
|
|
|
|
Risk factors
|
|
This investment involves a high degree of risk. See “Risk Factors” beginning on page S-5 of this prospectus supplement, our Annual Report on Form 10-K for the year ended December 31, 2017, which is incorporated by reference into this prospectus supplement, and the other reports incorporated by reference into the accompanying prospectus for a discussion of factors you should carefully consider before deciding to invest in our Common Stock.
|
The number of shares Common Stock to be outstanding
immediately after this offering is based on 29,923,076 shares of Common Stock outstanding as of July 18, 2018 and
excludes, as of that date:
●
|
243,375
shares of
Common Stock issuable upon the exercise of outstanding warrants at a weighted average exercise price of $10.28 per
share;
|
●
|
425,637
shares
of Common Stock issuable upon the exercise of outstanding stock options at a weighted average exercise price of $12.44
per share; and
|
●
|
1,813,467
shares
of Common Stock available for future grants under our 2007 Equity Incentive Plan and 2015 Equity Incentive Plan.
|
RISK
FACTORS
An
investment in our Common Stock involves a substantial risk of loss. You should carefully consider the risk factors set forth below
and in our Annual Report on Form 10-K for the year ended December 31, 2017, together with the other information included or incorporated
by reference into this prospectus supplement and the accompanying prospectus, before you decide to invest in our common stock.
The occurrence of any of these risks could harm our business. In that case, the trading price of our common stock could decline,
and you may lose all or part of your investment. Additional risks and uncertainties not presently known to us or that we currently
deem immaterial may also impair our operations. You should also refer to the other information contained in this prospectus supplement
and the accompanying prospectus or incorporated by reference herein or therein, including our financial statements and the notes
to those statements and the information set forth under the heading “Cautionary Note Regarding Forward-Looking Statements.”
Risks
Relating to Our Business
Because
we have lost $139.6 million from inception through March 31, 2018 and expect to continue losing money for an unforeseen number
of years, we cannot assure you we will ever generate revenue, achieve income from operations or have positive cash flow
.
As
an early stage drug development company, our focus is on developing product candidates, obtaining regulatory approval and commercializing
pharmaceutical products. As a result, we have lost $139.6 million from inception through March 31, 2018, we expect losses to continue,
and have never generated material revenue or revenue from product sales. Consequently, even with the proceeds of this offering,
it is likely that we will need to raise money again in the future. We cannot assure you that we will ever generate revenue, income
from operations or have positive cash flow.
Our
ability to continue as a going concern is in doubt absent obtaining adequate new financing.
We incurred a net loss
of approximately $1.6 million in the first quarter of 2018, $613,000 in 2017 and $75 million in 2016. We anticipate that we will
continue to lose money for the foreseeable future. Based on cash on hand as of July 18, 2018 of approximately $6.7
million, Cocrystal does not have the capital to finance operations for the next 12 months. This raises substantial doubt about
our ability to continue as a going concern. Our auditors issued an audit opinion for the year ended December 31, 2017 which contained
what is referred to as a “going concern” opinion. Our continued existence is dependent upon obtaining adequate new
financing. Because of our continuing losses, if we do not obtain new financing, we may have to continue to reduce our expenditures.
Working capital limitations may impinge on our day-to-day operations, including causing us to reduce our research and development
or planned clinical trials.
If
we do not raise additional debt or equity capital, we may not be able to remain operational.
Presently we have cash
to last through March 2019. Accordingly, we must raise approximately $2.5 million to support our planned operations over
the next 12 months.
Developing
pharmaceutical products, including conducting preclinical studies and clinical trials, is very expensive. We expect our research
and development expenses to substantially increase as we advance our product candidates toward clinical trials. In order to conduct
these trials, we will need to raise additional capital to support our operations and such funding may not be available to us on
acceptable terms, or at all. Moreover, any future financing may be at prices less than the public offering price of this offering
and be very dilutive to our existing stockholders.
As
we move lead compounds through toxicology and other preclinical studies, also referred to as nonclinical studies, we have and
we will be required to file an Investigational New Drug application or its equivalent in foreign countries, and as we conduct
clinical development of product candidates, we may have adverse results that may cause us to consume additional capital. If we
have partners, they may not elect to pursue the development and commercialization of our product candidates subject to our respective
agreements with them. These events may increase our development costs more than we expect. We may need to raise additional capital
or otherwise obtain funding through strategic alliances if we initiate clinical trials for new product candidates other than programs
currently partnered. We will require additional capital to obtain regulatory approval for, and to commercialize, product candidates.
Efforts
to secure additional financing may divert our management’s attention from our day-to-day activities, which may adversely
affect our ability to develop and commercialize product candidates.
We
cannot guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all. If we
cannot raise additional capital when required or on acceptable terms, we may be required to:
|
●
|
significantly
delay, scale back or discontinue the development or commercialization of any product candidates;
|
|
|
|
|
●
|
seek
strategic alliances for research and development programs at an earlier stage than otherwise would be desirable or on terms
less favorable than might otherwise be available; or
|
|
|
|
|
●
|
relinquish
or license on unfavorable terms, our rights to technologies or any product candidates we otherwise would seek to develop or
commercialize ourselves.
|
If
we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we will be prevented from pursuing
development and commercialization efforts, which will have a material adverse effect on our business, operating results and prospects
or may render us unable to continue operations at all.
We
have never generated revenue and expect that due to the regulatory constraints on a drug development company with products in
the pre-clinical and early clinical stages, we may not ever generate revenue and may continue to incur significant losses for
the foreseeable future.
We
are primarily a pre-clinical and early clinical stage biopharmaceutical discovery and development company. Since inception, our
operations have been limited to our organization and staffing, acquiring and developing intellectual property rights, developing
our technology platform, undertaking basic research on viral replication enzyme targets and conducting preclinical studies for
our initial programs. In 2016, we initiated our first clinical trial, a Phase 1 study for a hepatitis C product. In August 2017,
we announced positive data from the completion of the HCV Phase 1 study. Recently, we received FDA clearance for, and began enrollment
and initiated patient dosing in, the Phase 2a clinical trials of HCV. We plan to announce topline results in the Phase 2a study
by the end of 2018. Because of the need to complete clinical trials, establish safety and efficacy and obtaining regulatory approval,
we do not anticipate generating product revenue for at least five years and will continue to sustain large losses.
We
have devoted the majority of our financial resources to research and development. We have financed our operations primarily through
the sale of equity securities. The results of our operations will depend, in part, on the rate of future expenditures and our
ability to obtain funding through equity or debt financings, strategic alliances or grants. We anticipate our expenses will increase
substantially if and as we continue our research and clinical and preclinical development of our product candidates. We anticipate
that if we continue to undertake clinical studies our expenses will increase even further.
Because
we have yet to generate any revenue on which to evaluate our potential for future success and to determine if we will be able
to execute our business plan, it is difficult to evaluate our future prospects and the risk of success or failure of our business.
Our
ability to generate revenue and achieve profitability depends on our ability, alone or with partners, to successfully complete
the development of, obtain the regulatory approvals for and commercialize pharmaceutical product candidates. We have no pharmaceutical
product candidates that have generated any commercial revenue, do not expect to generate revenues from the commercial sale of
pharmaceutical products in the near future, and might never generate revenues from the sale of pharmaceutical products. Our ability
to generate revenue and achieve profitability will depend on, among other things, the following:
|
●
|
identifying
and validating new therapeutic strategies;
|
|
|
|
|
●
|
completing
our research and preclinical development of pharmaceutical product candidates;
|
|
|
|
|
●
|
initiating
and completing clinical trials for pharmaceutical product candidates;
|
|
|
|
|
●
|
seeking
and obtaining regulatory marketing approvals for pharmaceutical product candidates that successfully complete clinical trials;
|
|
|
|
|
●
|
establishing
and maintaining supply and manufacturing relationships with third parties;
|
|
|
|
|
●
|
launching
and commercializing pharmaceutical product candidates for which we obtain regulatory marketing approval, with a partner or,
if launched independently, successfully establishing a sales force, marketing and distribution infrastructure;
|
|
|
|
|
●
|
maintaining,
protecting, enforcing, defending and expanding our intellectual property portfolio; and
|
|
|
|
|
●
|
attracting,
hiring and retaining qualified personnel.
|
Because
of the numerous risks and uncertainties associated with pharmaceutical product development, we cannot predict the timing or amount
of increased expenses and when we will be able to achieve or maintain profitability, if ever. Our expenses could increase beyond
expectations if we are required by the regulatory agencies to perform unanticipated studies and trials.
Even
if one or more pharmaceutical product candidates we independently develop is approved for commercial sale, we anticipate incurring
significant costs associated with commercializing any approved pharmaceutical product candidate. Moreover, if we can generate
revenues from the sale of any approved pharmaceutical products, we may not become profitable and may need to obtain additional
funding to continue operations.
Because
our future commercial success depends on gaining regulatory approval for our products, we cannot generate revenue without obtaining
approvals
.
Our
long-term success and generation of revenue will depend upon the successful development of new products from our research and
development activities, including those licensed or acquired from third parties. Product development is very expensive and involves
a high degree of risk. Only a small number of research and development programs result in the commercialization of a product.
The process for obtaining regulatory approval to market a product like our hepatitis C product is expensive, often takes many
years, and can vary substantially based on the type, complexity, and novelty of the product candidates involved. Our ability to
generate revenues would be adversely affected if we are delayed or unable to successfully develop our products.
We
cannot guarantee that any marketing application for our product candidates will be approved. If we do not obtain regulatory approval
of our products or we are significantly delayed or limited in doing so, we cannot generate revenue, and we may need to significantly
curtail operations.
Risk
Related to This Offering
We
have broad discretion in the use of the net proceeds we receive from this offering and may not use them effectively.
We
cannot specify with certainty the particular uses of the net proceeds we will receive from this offering. We will have broad discretion
in the application of these net proceeds, including for any of the purposes described in the section entitled “Use of Proceeds.”
Accordingly, you will have to rely upon our judgment with respect to the use of these net proceeds, with only limited information
concerning our specific intentions. We may spend a portion or all of the net proceeds we will receive from this offering in ways
that our stockholders may not desire or that may not yield a favorable return. Our failure to apply these funds effectively could
harm our business.
The
price of our Common Stock may be volatile or may decline regardless of our operating performance, and you may not be able to resell
your shares at or above the price at which you purchase them in this offering.
The
market price of our Common Stock following this offering may be higher or lower than the price at which you purchase them in this
offering. The market price of our Common Stock your purchase of shares in this offering will depend on a number of factors, many
of which are beyond our control and may not be related to our operating performance. These fluctuations could cause you to lose
part of your investment in our Common Stock since you might be unable to sell your shares at or above the price you paid in this
offering. Factors that could cause fluctuations in the market price of our common stock include the following:
|
●
|
price
and volume fluctuations in the overall stock market from time to time;
|
|
|
|
|
●
|
volatility
in the market prices and trading volumes of biotechnology stocks generally, or those in our industry in particular;
|
|
|
|
|
●
|
our
announcements concerning the initiation and results of clinical trials;
|
|
|
|
|
●
|
changes
in operating performance and stock market valuations of other biotechnology companies generally, or those in our industry
in particular;
|
|
●
|
sales
of shares of our stock by us or our stockholders;
|
|
|
|
|
●
|
the
failure of securities analysts to maintain coverage of us, changes in financial estimates by securities analysts who follow
us or our failure to meet these estimates or the expectations of investors;
|
|
|
|
|
●
|
the
financial projections we may provide to the public, any changes in those projections or our failure to meet those projections;
|
|
|
|
|
●
|
announcements
by us or our competitors of new novel medicines;
|
|
|
|
|
●
|
the
public’s reaction to our earnings releases, other public announcements and filings with the SEC;
|
|
|
|
|
●
|
rumors
and market speculation involving us or other companies in our industry;
|
|
|
|
|
●
|
actual
or anticipated developments in our business, our competitors’ businesses or the competitive landscape generally;
|
|
|
|
|
●
|
actual
or anticipated changes in our operating results or fluctuations in our operating results;
|
|
|
|
|
●
|
litigation
involving us, our industry or both, or investigations by regulators into our operations or those of our competitors;
|
|
|
|
|
●
|
developments
or disputes concerning our intellectual property or other proprietary rights;
|
|
|
|
|
●
|
new
laws or regulations or new interpretations of existing laws or regulations applicable to our business;
|
|
|
|
|
●
|
changes
in accounting standards, policies, guidelines, interpretations or principles;
|
|
|
|
|
●
|
any
significant change in our management; and
|
|
|
|
|
●
|
general
economic conditions and slow or negative growth in any of our significant markets.
|
In
addition, in the past, following periods of volatility in the overall market and the market price of particular companies’
securities, securities class action litigation has often been instituted against companies. This litigation, if instituted against
us, could result in substantial costs and a diversion of our management’s attention and resources.
You
likely will experience immediate and substantial dilution in the net tangible book value per share of the common stock you purchase.
The price per share of
our Common Stock you pay in this offering likely will be substantially higher than the net tangible book value per share
of our Common Stock outstanding prior to this offering. Accordingly, you likely will experience immediate and substantial
dilution in the net tangible book value of the common stock you purchase in this offering. See the section entitled “Dilution”
in this prospectus supplement.
The
issuance of additional shares of our Common Stock could be dilutive to stockholders if they do not invest in future offerings.
In addition, we have a significant number of options and warrants to purchase shares or our common stock outstanding. If these
securities are exercised, you may incur further dilution. Moreover, to the extent that we issue additional options or warrants
to purchase, or securities convertible into or exchangeable for, shares of our Common Stock in the future and those options, warrants
or other securities are exercised, converted or exchanged, stockholders may experience further dilution.
Because
certain of our stockholders control a significant number of shares of our Common Stock, they may
have
effective control over actions requiring stockholder approval.
As of the date of this
prospectus supplement, our directors, executive officers and principal stockholders (those beneficially owning in excess of 5%),
and their respective affiliates, beneficially own approximately 60% of our outstanding shares of Common Stock. As a result,
these stockholders, acting together, would have the ability to control the outcome of matters submitted to our stockholders for
approval, including the election of directors and any merger, consolidation or sale of all or substantially all of our assets.
Dr.
Schinazi, our Chairman, and Dr. Phillip Frost, a director and certain other stockholders entered into a Stockholders Rights Agreement
in November 2014 when we acquired another company headed by Dr. Schinazi. This Agreement gives each of Dr. Schinazi and Dr. Frost
(and certain other stockholders) the right to designate three directors to a seven person board of directors and together agree
upon the seventh designee. In addition, our principal stockholders, acting together, would have the ability to control our management
and affairs. Accordingly, this concentration of ownership might harm the market price of our common stock by:
|
●
|
delaying,
deferring or preventing a change in corporate control;
|
|
|
|
|
●
|
impeding
a merger, consolidation, takeover or other business combination involving us; or
|
|
|
|
|
●
|
discouraging
a potential acquirer from making a tender offer or otherwise attempting to obtain control of us.
|
Further,
the Stockholder Rights Agreement provides Dr. Schinazi and Dr. Frost and certain other Cocrystal stockholders with rights including
the right to approve future financings and a right of first refusal, which have not been impediments to date and have been waived
in connection with the offering of Common Stock pursuant to this prospectus supplement. However, in the event of any future disagreements
between Dr. Schinazi and Dr. Frost, we may be unable to raise future capital we need or make concessions to one of these directors,
which may adversely affect us or result in additional expenses.
Although
our Common Stock is listed on The Nasdaq Capital Market, we are subject to a risk that Nasdaq will delist us or subject us to
additional trading restrictions, which could limit investors’ ability to make transactions in our securities.
Our
Common Stock recently began trading on The Nasdaq Capital Market, a national securities exchange. Nasdaq rules require us to meet
certain requirements for continued listing including our stock price and number of public stockholders. We cannot assure you that
we will be able to meet the continued listing requirements. If removes our common stock is delisted from The Nasdaq Capital Market
for failure to meet its continued listing requirements, we could face significant material adverse consequences, including:
|
●
|
a
limited availability of market quotations for our Common Stock;
|
|
●
|
reduced
liquidity with respect to our Common Stock;
|
|
|
|
|
●
|
a
determination that our shares of Common Stock are a “penny stock” which will require broker-dealers trading in
our Common Stock to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary
trading market for our Common Stock;
|
|
|
|
|
●
|
a
limited amount of news and analyst coverage for our company; and
|
|
|
|
|
●
|
a
limited ability to issue additional securities or obtain additional financing in the future.
|
The
National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating
the sale of certain securities, which are referred to as “covered securities.” Because our common stock is listed
on The Nasdaq Capital Market, our common stock is a covered security. Although the states are preempted from regulating the sale
of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if
there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular
case. Further, if we were no longer listed on The Nasdaq Capital Market, our securities would not be covered securities and we
would be subject to regulation in each state in which we offer our securities. In many states, we would not meet the merit review
standards which are applied to public offerings.
Because
our Common Stock is thinly traded, purchasers in this offering may incur difficulty in selling their shares at or above the price
they paid for them.
Until March 11, 2018,
our Common Stock traded on the OTCQB, which has not been a liquid market. While The Nasdaq Capital Market where our Common
Stock is currently listed is more liquid than the OTCQB, in the brief period since its listing, the volume has not been materially
greater. We cannot assure you that an active market for our Common Stock will develop, or if it does, it will be sustained. Accordingly,
investors may experience difficulty is selling their shares of Common Stock at or above the price they paid for them.
Future
sales of our Common Stock could cause the market price for our common stock to decline.
We
cannot predict the effect, if any, that market sales of shares of our Common Stock or the availability of shares of our common
stock for sale will have on the market price of our Common Stock prevailing from time to time. Sales of substantial amounts of
shares of our Common Stock in the public market, or the perception that those sales will occur, could cause the market price of
our Common Stock to decline or be depressed.
The
shares of Common Stock issued in connection with this offering will be freely tradable without restriction or further registration
under the Securities Act.
If
we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce
timely and accurate financial statements or comply with applicable regulations could be impaired.
As
a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley
Act”) and the Nasdaq listing standards. We expect that the requirements of these rules and regulations will continue to
increase our legal, accounting, and financial compliance costs, make some activities more difficult, time-consuming and costly,
and place significant strain on our personnel, systems, and resources.
The
Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control
over financial reporting. We are continuing to develop and refine our disclosure controls and other procedures that are designed
to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed,
summarized, and reported within the time periods specified in SEC rules and forms and that information required to be disclosed
in reports under the Exchange Act is accumulated and communicated to our principal executive and financial officers. We are also
continuing to improve our internal control over financial reporting. In order to maintain and improve the effectiveness of our
disclosure controls and procedures and internal control over financial reporting, we have expended, and anticipate that we will
continue to expend, significant resources, including accounting-related costs and significant management oversight.
Our
management has concluded that our disclosure controls and procedures were not effective as of December 31, 2017 as the result
of certain material weaknesses in our internal control over financial reporting identified in our Annual Report on Form 10-K for
the year ended December 31, 2017. Other weaknesses in our disclosure controls and internal control over financial reporting may
be identified in the future. Any failure to develop or maintain effective controls or any difficulties encountered in their implementation
or improvement could harm our results of operations or cause us to fail to meet our reporting obligations and may result in a
restatement of our financial statements for prior periods. Any failure to implement and maintain effective internal control over
financial reporting also could adversely affect the results of periodic management evaluations and annual independent registered
public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that we
will eventually be required to include in our periodic reports that will be filed with the SEC.
BDO
USA, LLP, our independent registered public accounting firm, has audited the effectiveness of our internal control over financial
reporting and has also concluded that we did not maintain, in all material respects, effective internal control over financial
reporting as of December 31, 2017.
Ineffective
disclosure controls and procedures and internal control over financial reporting could also cause investors to lose confidence
in our reported financial and other information, which would likely have a negative effect on the trading price of our common
stock.
USE
OF PROCEEDS
We
intend to use the net proceeds from this offering, after deducting the Agents’ commissions and our offering expenses, for
general corporate purposes and the continued development of novel medicines for use in the treatment of human viral diseases.
As
of the date of this prospectus supplement, we cannot specify with certainty all of the particular uses of the proceeds from this
offering. Accordingly, we will retain broad discretion over the use of such proceeds. Pending the use of the net proceeds from
this offering as described above, we intend to invest the net proceeds in short-term, investment-grade securities.
DILUTION
If you purchase shares
of Common Stock in this offering, your interest will be diluted to the extent of the difference between the price per share you
pay in this offering and the net tangible book value per share of our Common Stock after this offering. Our net tangible book
value as of March 31, 2018 was approximately $(14.9) million, or $(0.616) per share. Net tangible book value
per share represents the amount of our total tangible assets, excluding goodwill and intangible assets, less total liabilities
divided by the total number of shares of our common stock outstanding.
After giving effect to
the sale of shares of our Common Stock in the aggregate amount of $10,000,000 at an assumed offering price of $4.95
per share, the last reported sale price of our Common Stock on July 17, 2018 on The Nasdaq Capital Market, and after
deducting estimated commissions and estimated offering expenses, our as adjusted net tangible book value as of July 18,
2018 would have been approximately $(5.0) million or approximately $(0.19) per share. This represents an immediate
increase in the net tangible book value of approximately $0.42 per share to our existing stockholders and an immediate
dilution in as adjusted net tangible book value of approximately $5.14 per share to purchasers of our Common Stock in this
offering, as illustrated by the following table:
Assumed offering price per share
|
|
|
|
|
|
$
|
4.95
|
|
|
|
|
|
|
|
|
|
|
Net tangible book value per share as of March 31, 2018
|
|
$
|
(0.616
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase in net tangible book value per share attributable to this offering
|
|
$
|
0.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As adjusted net tangible book value per share after this offering
|
|
$
|
|
|
|
|
(0.19)
|
|
|
|
|
|
|
|
|
|
|
Dilution per share to new investors in this offering
|
|
|
|
|
|
$
|
5.14
|
|
The table above assumes
for illustrative purposes only an aggregate of 2,020,202 shares of our Common Stock are sold at a price of $4.95
per share, for aggregate gross proceeds of $10 million. The shares, if any, sold in this offering will be sold from time
to time at various prices. An increase of $1.00 per share in the price at which the shares are sold from the assumed offering
price of $4.95 per share shown in the table above, assuming all of our Common Stock in the aggregate amount of $10 million
is sold at that price, would increase our adjusted net tangible book value per share after the offering to $(0.20) per share and
would increase the dilution in net tangible book value per share to new investors in this offering to $6.15 per share,
after deducting commissions and estimated aggregate offering expenses payable by us. A decrease of $1.00 per share in the
price at which the shares are sold from the assumed offering price of $4.95 per share shown in the table above, assuming
all of our Common Stock in the aggregate amount of $10 million is sold at that price, would increase our adjusted net tangible
book value per share after the offering to $(0.19) per share and would decrease the dilution in net tangible book value
per share to new investors in this offering to $4.14 per share, after deducting commissions and estimated aggregate offering
expenses payable by us. This information is supplied for illustrative purposes only.
The above calculations
are based on 24,402,444 shares of Common Stock outstanding as of March 31, 2018 and exclude, as of that date:
|
●
|
209,166
shares of Common Stock issuable upon the exercise of outstanding warrants at a weighted average exercise price of $15.00
per share;
|
|
|
|
|
●
|
425,637
shares of Common Stock issuable upon the exercise of outstanding stock options at a weighted average exercise price of $12.44
per share; and
|
|
|
|
|
●
|
1,813,467
shares of Common Stock available for future grants under our 2007 Equity Incentive Plan and 2015 Equity Incentive Plan.
|
To
the extent that any outstanding options or warrants are exercised, or we otherwise issue additional shares of common stock in
the future, at a price less than the public offering price, there will be further dilution to the investors.
DIVIDEND
POLICY
We
have never declared or paid cash dividends on our capital stock. We currently intend to retain our future earnings, if any, for
use in our business and therefore do not anticipate paying cash dividends in the foreseeable future. Payment of future dividends,
if any, will be at the discretion of our board of directors after taking into account various factors, including our financial
condition, operating results, current and anticipated cash needs and plans for expansion.
PLAN
OF DISTRIBUTION (CONFLICTS OF INTEREST)
We have entered into an
equity distribution agreement with the Agents under which we may issue and sell from time to time shares of our Common Stock having
an aggregate gross offering price of up to $10,000,000 through the Agents. Sales of our Common Stock, if any, under this
prospectus supplement and the accompanying prospectus may be made by any method permitted by law deemed to be an “at the
market” offering as defined in Rule 415 of the Securities Act, including without limitation sales made directly on The Nasdaq
Capital Market, on any other existing trading market for the Common Stock or to or through a market maker. If specified by us,
the Agents may also sell our Common Stock by any other method permitted by law, including but not limited to in privately negotiated
transactions.
Each
time that we wish to sell shares of our Common Stock under the equity distribution agreement, we will provide notice to an Agent
containing the parameters within which the shares must be sold, which shall at a minimum include the number of shares, the time
period during which sales are requested to be made, any limitation on the number of shares that may be sold in any one trading
day and any minimum price below which sales may not be made. The Agents are not required to sell any certain number of shares
or dollar amount of our Common Stock, but will act as sales agents and use commercially reasonable efforts to sell on our behalf
all of the shares of Common Stock requested to be sold by us, consistent with their normal trading and sales practices, subject
to the terms of the equity distribution agreement. We or the Agents may suspend the offering of our Common Stock under the equity
distribution agreement upon proper notice and subject to other conditions.
We will pay the Agents
commissions for their services in acting as agents in the sale of our Common Stock. Under the equity distribution agreement, the
Agents will be entitled to compensation of up to 2.0% of the gross sales price of our Common Stock sold through them as
our agent. We also have agreed to reimburse the Agents for the reasonable out-of-pocket incurred by them in connection with the
transactions contemplated by the equity distribution agreement, including fees and disbursements of counsel to Ladenburg,
not to exceed $50,000. In addition, we have agreed to reimburse Ladenburg for the reasonable out-of-pocket expenses incurred
by them in connection with the delivery of certain documents under the equity distribution agreement, not to exceed $4,000
per such delivery.
The
Agent will provide written confirmation to us following the close of trading on The Nasdaq Capital Market each day on which shares
of our Common Stock are sold by the Agent for us under the equity distribution agreement. Each confirmation will include the number
of shares sold on that day, the gross sales price per share and the net proceeds to us.
Settlement
for sales of our Common Stock will occur, unless the parties agree otherwise, on the second business day following the date on
which any sales were made in return for payment of the net proceeds or gross sales price to us. There is no arrangement for funds
to be received in an escrow, trust or similar arrangement.
We
also may sell shares of our Common Stock to the Agents as principals for their own account at a price agreed upon at the time
of sale. Under the terms of the equity distribution agreement, the terms of any such sale will be set forth in writing, and we
will describe these terms in a separate prospectus supplement.
We
will report in a prospectus supplement and/or our filings with the SEC under the Exchange Act at least quarterly the number of
shares of our Common Stock sold through the Agents under the equity distribution agreement, the net proceeds to us and the compensation
paid by us to the Agent in connection with the sales of our Common Stock.
In
connection with the sale of our Common Stock on our behalf, each Agent may be deemed to be an “underwriter” within
the meaning of the Securities Act, and the compensation paid to such Agent may be deemed to be underwriting commissions or discounts.
We
have agreed to indemnify the Agents against specified liabilities, including liabilities under the Securities Act, or to contribute
to payments that each such Agent may be required to make because of those liabilities.
The
offering of our Common Stock pursuant to the equity distribution agreement will terminate upon the earlier of (i) the sale of
all shares of our Common Stock subject to the equity distribution agreement and (ii) the termination of the equity distribution
agreement by us and/or by the Agents
In
connection with acting as our agents, the Agents will not engage in any transactions that stabilize our shares of common stock.
To the extent required by Regulation M, the Agents will not engage in any market making activities involving our common stock
while the offering is ongoing under this prospectus supplement.
We estimate that the total
expenses for the offering, excluding commissions and reimbursable expenses payable to the Agents under the terms of the equity
distribution agreement, will be approximately $65,000. The remaining sales proceeds, after deducting commissions and reimbursable
expenses payable to the Agents, the other expenses payable by us and any transaction fees imposed by any governmental, regulatory
or self-regulatory organization in connection with the sales, will equal our net proceeds for the sale of such shares.
Additional
Relationships
The
Agents and their affiliates are financial institutions engaged in various activities, which may include sales and trading, commercial
and investment banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage
and other financial and non-financial activities and services. The Agents and their affiliates may provide from time to time in
the future in the ordinary course of their business certain commercial banking, financial advisory, investment banking and other
services to us for which they will be entitled to receive customary fees and expenses. In the ordinary course of their various
business activities, the Agents and their affiliates may also make or hold a broad array of investments and actively trade debt
and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account
and for the accounts of their customers, and such investment and securities activities may involve securities and/or instruments
of ours. The Agents and their affiliates may also make investment recommendations and/or publish or express independent research
views in respect of these securities or instruments and may at any time hold, or recommend to clients that they acquire, long
and/or short positions in these securities and instruments.
AGP previously acted as
the underwriter in our public offering of Common Stock consummated on May 3, 2018, for which AGP received customary compensation,
consisting of approximately $747,300 of discounts and reimbursable expenses (including the over-allotment option).
In connection with the underwritten public offering, we also granted to AGP and its assigns warrants to purchase an aggregate
of 84,211 shares of our Common Stock. The warrants are exercisable for cash or on a cashless basis at an exercise price of $2.09
per share, are exercisable beginning on October 27, 2018 and expire on October 27, 2022. The warrants provide for a one-time demand
registration right and unlimited piggyback registration rights. The exercise price and number of shares of common stock issuable
upon exercise of the warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary
cash dividend or our recapitalization, reorganization, share reconstruction, amalgamation or consolidation. Furthermore, in connection
with the underwritten public offering, we granted AGP an irrevocable right of first refusal until January 3, 2019 to act as sole
and exclusive investment banker, sole and exclusive book-runner and/or sole and exclusive placement agent at its sole and exclusive
discretion for each and every future public and private equity and debt offering, including all equity linked financings, of ours
on commercially reasonable terms and conditions. AGP waived this right with respect to the offering of our Common Stock pursuant
to this prospectus supplement.
Conflicts
of Interest
Ladenburg
has a “conflict of interest” within the meaning of FINRA Rule 5121(f)(5)(B) in this offering because Dr. Phillip Frost
beneficially owns more than 10% of our common equity and more than 10% of the common equity of Ladenburg’s parent, Ladenburg
Thalmann Financial Services, Inc. Dr. Frost beneficially owns 35.9% of the outstanding common stock of Ladenburg Thalmann Financial
Services, Inc. and 12.2% of our outstanding Common Stock. The amount of our Common Stock beneficially owned by Dr. Frost does
not include shares of Common Stock held by OPKO Health, Inc., an entity of which Dr. Frost is the chairman and chief executive
officer, but over whose securities Dr. Frost does not exercise voting or investment control. Dr. Frost is also a director of ours
and chairman of the board of Ladenburg Thalmann Financial Services, Inc. In addition, Dr. Frost has certain rights under the Stockholders
Rights Agreement, certain of which he waived in connection with this offering, as described under “
Risk Factors
”
above.
Accordingly,
this offering is being made in compliance with the applicable requirements of FINRA Rule 5121. FINRA Rule 5121 requires that a
“qualified independent underwriter,” as defined in FINRA Rule 5121, participate in the preparation of the registration
statement and prospectus and exercise the usual standards of due diligence with respect thereto. Barrington Research has agreed
to act as a “qualified independent underwriter” for this offering. Barrington Research will not receive any additional
compensation for acting as a qualified independent underwriter. In addition, Ladenburg will not confirm sales to any account over
which it exercises discretionary authority without receiving the specific prior written approval of the account holder and retaining
such approval in its records.
LEGAL
MATTERS
The
legality of the Common Stock offered by this prospectus supplement and the accompanying prospectus has been passed upon for us
by Nason Yeager Gerson White & Lioce, P.A., Palm Beach Gardens, Florida. Graubard Miller is acting as counsel to the Agents
in connection with certain legal matters relating to this offering.
EXPERTS
The
consolidated financial statements as of December 31, 2017 and 2016 and for each of the three years in the period ended December
31, 2017 and management’s assessment of the effectiveness of internal control over financial reporting as of December 31,
2017 incorporated by reference in this prospectus supplement have been so incorporated by reference in reliance on the reports
of BDO USA, LLP, an independent registered public accounting firm (the report on the financial statements contains an explanatory
paragraph regarding our ability to continue as a going concern and the report on the effectiveness of internal control over financial
reporting expresses an adverse opinion on the effectiveness of our internal control over financial reporting as of December 31,
2017), incorporated by reference herein, given on the authority of said firm as experts in auditing and accounting.
WHERE
YOU CAN FIND MORE INFORMATION
We
file annual, quarterly and special reports, proxy statements and other information with the SEC. You may read and copy any document
we file at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330
for more information about the operation of the public reference room. The SEC maintains an internet website that contains reports,
proxy and information statements, and other information regarding issuers that file electronically with the SEC, including Cocrystal
at www.sec.gov. You may also access our SEC reports and proxy statements free of charge at our website, www.cocrystalpharma.com.
The information contained in, or that can be accessed through, our website is not part of this prospectus supplement.
This
prospectus supplement and the accompanying prospectus are part of
the registration statement
on Form S-3 filed with the SEC under the Securities Act for the Common Stock offered by this prospectus supplement. This prospectus
supplement does not contain all of the information set forth in the registration statement, certain parts of which have been omitted
in accordance with the rules and regulations of the SEC. For further information, reference is made to the registration statement
and its exhibits. Whenever we make references in this prospectus supplement or the accompanying prospectus to any of our contracts,
agreements or other documents, the references are not necessarily complete and you should refer to the exhibits attached to the
registration statement for the copies of the actual contract, agreement or other document.
DOCUMENTS
INCORPORATED BY REFERENCE
The
SEC allows us to incorporate by reference the information we file with it, which means that we can disclose important information
to you by referring you to another document that we have filed separately with the SEC. A
ny
information that we incorporate by reference is considered part of this prospectus supplement.
We hereby incorporate by
reference the following information or documents into this prospectus supplement and the accompanying prospectus:
|
●
|
our
annual report on Form 10-K for the fiscal year ended December 31, 2017, filed with the SEC on March 21, 2018 (as amended by
the Form 10-K/A filed on April 30, 2017);
|
|
|
|
|
●
|
our
quarterly report on Form 10-Q for the fiscal quarter ended March 31, 2018, filed with the SEC on May 10, 2018;
|
|
|
|
|
●
|
Our
current reports on Form 8-K filed with the SEC on January 24, 2018, February 6, 2018, February 14, 2018, May 2, 2018 and May
21, 2018 (excluding information furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are
related to such items); and
|
|
|
|
|
●
|
the
description of our Common Stock contained in our Registration Statement on Form 8-A (File No. 001-38418), filed with the SEC
under Section 12(b) of the Exchange Act on March 9, 2018, including any subsequent amendment or report filed for the purpose
of amending such description.
|
Any
information in any of the foregoing documents will automatically be deemed to be modified or superseded to the extent that information
in this prospectus supplement or the accompanying prospectus or in a later filed document that is incorporated or deemed to be
incorporated herein by reference modifies or replaces such information.
We
also incorporate by reference any future filings (excluding information furnished under Item 2.02 or Item 7.01 of Form 8-K and
exhibits filed on such form that are related to such items) made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Exchange Act, until we sell all of the securities offered by this prospectus supplement. Information in such future filings
updates and supplements the information provided in this prospectus supplement. Any statements in any such future filings will
automatically be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated
or deemed to be incorporated herein by reference to the extent that statements in the later filed document modify or replace such
earlier statements.
Upon
written or oral request, we will provide to you, without charge, a copy of any or all of the documents that are incorporated by
reference into this prospectus supplement and the accompanying prospectus but not delivered with the prospectus, including exhibits
which are specifically incorporated by reference into such documents. Requests should be directed to:
Cocrystal
Pharma, Inc.
1860
Montreal Road, Tucker, Georgia 30084
Attention:
Corporate Secretary
(678)
892-8800
PROSPECTUS
$150,000,000
Cocrystal
Pharma, Inc.
Common
Stock
Preferred
Stock
Warrants
Units
Cocrystal
Pharma, Inc. intends to offer and sell from time to time the securities described in this prospectus. The total offering price
of the securities described in this prospectus will not exceed a total of $150,000,000.
This
prospectus describes some of the general terms that apply to the securities. We will provide specific terms of any securities
we may offer in supplements to this prospectus. You should read this prospectus and any applicable prospectus supplement carefully
before you invest. We also may authorize one or more free writing prospectuses to be provided to you in connection with the offering.
The prospectus supplement and any free writing prospectus also may add, update or change information contained or incorporated
in this prospectus.
We
may offer and sell these securities to or through one or more underwriters, dealers or agents, or directly to purchasers on a
continuous or delayed basis. The prospectus supplement for each offering of securities will describe the plan of distribution
for that offering. For general information about the distribution of securities offered, see “Plan of Distribution”
in this prospectus. The prospectus supplement also will set forth the price to the public of the securities and the net proceeds
that we expect to receive from the sale of such securities.
Our
common stock is traded on the OTCQB under the symbol “COCP.” On September 22, 2017, the last reported sales price
of our common stock on the OTCQB was $0.28 per share and our public float consisted of 293,887,980 shares of common stock.
Investing
in our securities involves risks. You should read carefully and consider “Risk Factors” included in our most recent
Annual Report on Form 10-K and on page 2 of this prospectus and in the applicable prospectus supplement before investing in our
securities.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined whether this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The
date of this prospectus is October 10, 2017
TABLE
OF CONTENTS
You
should rely only on information contained in this prospectus. We have not authorized anyone to provide you with information that
is different from that contained in this prospectus. We are not offering to sell or seeking offers to buy shares of common stock
in jurisdictions where offers and sales are not permitted. The information contained in this prospectus is accurate only as of
the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common stock. We are
responsible for updating this prospectus to ensure that all material information is included and will update this prospectus to
the extent required by law.
PROSPECTUS
SUMMARY
This
summary only highlights the more detailed information appearing elsewhere in this prospectus or incorporated by reference in this
prospectus. It may not contain all of the information that is important to you. You should carefully read the entire prospectus
and the documents incorporated by reference in this prospectus before deciding whether to invest in our securities. Unless otherwise
indicated or the context requires otherwise, in this prospectus and any prospectus supplement hereto references to “Cocrystal,”
“we,” “us,” and “our” refer to Cocrystal Pharma, Inc. and its consolidated subsidiaries.
About
This Prospectus
This
prospectus is part of a “shelf” registration statement that we have filed with the Securities and Exchange Commission
or the SEC. By using a shelf registration statement, we may sell, at any time and from time to time, in one or more offerings,
any combination of the securities described in this prospectus. The exhibits to our registration statement contain the full text
of certain contracts and other important documents we have summarized in this prospectus. Since these summaries may not contain
all the information that you may find important in deciding whether to purchase the securities we offer, you should review the
full text of these documents. The registration statement and the exhibits can be obtained from the SEC as indicated under the
section entitled “Incorporation of Certain Documents by Reference.”
This
prospectus only provides you with a general description of the securities we may offer. Each time we sell securities, we will
provide a prospectus supplement that contains specific information about the terms of those securities. The prospectus supplement
also may add, update or change information contained in this prospectus. If there is an inconsistency between the information
in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. You should
read carefully both this prospectus and any prospectus supplement together with the additional information described below under
the section entitled “Incorporation of Certain Documents by Reference.”
We
are not making an offer of these securities in any jurisdiction where the offer is not permitted. You should not assume that the
information in this prospectus or a prospectus supplement is accurate as of any date other than the date on the front of the document.
Our
Company
Cocrystal
Pharma, Inc. is a biotechnology company working to develop novel medicines for use in the treatment of human viral diseases. Cocrystal
has developed proprietary structure-based drug design technology and antiviral nucleoside chemistry to create first-in-class and
best-in-class antiviral drug candidates. Our focus is to pursue the development and commercialization of broad-spectrum antiviral
drug candidates that will transform the treatment and prophylaxis of hepatitis C, influenza and norovirus infections. By concentrating
our research and development efforts on viral replication inhibitors, we plan to leverage our infrastructure and expertise in
these areas.
Corporate
Information
Our
principal executive offices are located at 1860 Montreal Road, Tucker, Georgia 30084 and our telephone number is (404) 601-1430.
Our Internet website address is www.cocrystalpharma.com. The information on our website is not incorporated into this prospectus.
CAUTIONARY
NOTE REGARDING FORWARD LOOKING STATEMENTS
This
prospectus including the incorporated documents contains forward-looking statements. All statements other than statements of historical
facts, including statements regarding our future financial position, liquidity, business strategy and plans and objectives of
management for future operations, are forward-looking statements. The words “believe,” “may,” “estimate,”
“continue,” “anticipate,” “intend,” “should,” “plan,” “could,”
“target,” “potential,” “is likely,” “will,” “expect” and similar expressions,
as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely
on our current expectations and projections about future events and financial trends that we believe may affect our financial
condition, results of operations, business strategy and financial needs.
The
results anticipated by any or all of these forward-looking statements might not occur. Important factors, uncertainties and risks
that may cause actual results to differ materially from these forward-looking statements are contained in the risk factors that
follow and elsewhere in this prospectus and the incorporated documents. We undertake no obligation to publicly update or revise
any forward-looking statements, whether as the result of new information, future events or otherwise. For more information regarding
some of the ongoing risks and uncertainties of our business, see the risk factors that follow and or that are disclosed in our
incorporated documents.
RISK
FACTORS
Investing
in our securities involves risks. Before purchasing the securities offered by this prospectus you should consider carefully the
risk factors incorporated by reference in this prospectus from our Annual Report on Form 10-K for the year ended December 31,
2016 filed with the SEC on March 31, 2017, as subsequently amended, as well as the risks, uncertainties and additional information
(i) set forth in our SEC reports on Forms 10-K, 10-Q and 8-K and in the other documents incorporated by reference in this prospectus
that we file with the SEC after the date of this prospectus and which are deemed incorporated by reference in this prospectus,
and (ii) the information contained in any applicable prospectus supplement. For a description of these reports and documents,
and information about where you can find them, see “Incorporation of Certain Documents By Reference.” The risks and
uncertainties we discuss in this prospectus and in the documents incorporated by reference in this prospectus are those that we
currently believe may materially affect our company. Additional risks not presently known, or currently deemed immaterial, also
could materially and adversely affect our financial condition, results of operations, business and prospects.
USE
OF PROCEEDS
Unless
we specify otherwise in an accompanying prospectus supplement, we intend to use the net proceeds from the sale of the securities
by us to provide additional funds for working capital and other general corporate purposes. Any specific allocation of the net
proceeds of an offering of securities will be determined at the time of such offering and will be described in the accompanying
supplement to this prospectus.
DESCRIPTION
OF CAPITAL STOCK
We
are authorized to issue 800,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock,
par value $0.001 per share.
Common
Stock
We
are authorized to issue 800,000,000 shares of common stock, par value $0.001 per share. The holders of common stock are entitled
to one vote per share on all matters submitted to a vote of shareholders, including the election of directors. There is no cumulative
voting in the election of directors. In the event of our liquidation or dissolution, holders of common stock are entitled to share
ratably in all assets remaining after payment of liabilities and the liquidation preferences of any outstanding shares of preferred
stock. Holders of common stock have no preemptive rights and have no right to convert their common stock into any other securities
and there are no redemption provisions applicable to our common stock.
The
holders of common stock are entitled to any dividends that may be declared by the Board of Directors out of funds legally available
for payment of dividends subject to the prior rights of holders of preferred stock and any contractual restrictions we have against
the payment of dividends on common stock. We have not paid dividends on our common stock since inception and do not plan to pay
dividends on our common stock in the foreseeable future.
As
of September 25, 2017, we had 726,531,530 shares of common stock outstanding. In addition, as of that date, there were 29,326,000
shares underlying our outstanding warrants and stock options.
Preferred
Stock
We
are authorized to issue 5,000,000 shares of “blank check” preferred stock with designations, rights and preferences
as may be determined from time to time by our Board of Directors. As the date of this prospectus, we had no shares of preferred
stock issued and outstanding.
Preferred
stock is available for possible future financings or acquisitions and for general corporate purposes without further authorization
of our shareholders unless such authorization is required by applicable law, or the rules of any securities exchange or market
on which our stock is then listed or admitted or trading.
Our
Board of Directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect
the voting power or other rights of the holders of common stock. The issuance of preferred stock, while providing flexibility
in connection with possible acquisitions and other corporate purposes could, under some circumstances, have the effect of delaying,
deferring or preventing a change in control of the Company. For a description of how future issuances of our preferred stock could
affect the rights of our shareholders, see “Certain Provisions of Delaware Law and of Our Charter and Bylaws - Issuance
of “blank check” Preferred Stock,” below.
A
prospectus supplement relating to any series of preferred stock being offered will include specific terms relating to the offering.
Such prospectus supplement will include:
●
|
the
title and stated or par value of the preferred stock;
|
|
|
●
|
the
number of shares of the preferred stock offered, the liquidation preference per share and the offering price of the preferred
stock;
|
|
|
●
|
the
dividend rate(s), period(s) and/or payment date(s) or method(s) of calculation thereof applicable to the preferred stock;
|
|
|
●
|
whether
dividends shall be cumulative or non-cumulative and, if cumulative, the date from which dividends on the preferred stock shall
accumulate;
|
●
|
the
provisions for a sinking fund, if any, for the preferred stock;
|
|
|
●
|
any
voting rights of the preferred stock;
|
|
|
●
|
the
provisions for redemption, if applicable, of the preferred stock;
|
|
|
●
|
any
listing of the preferred stock on any securities exchange;
|
|
|
●
|
the
terms and conditions, if applicable, upon which the preferred stock will be convertible into our common stock, including the
conversion price or the manner of calculating the conversion price and conversion period;
|
|
|
●
|
if
appropriate, a discussion of federal income tax consequences applicable to the preferred stock; and
|
|
|
●
|
any
other specific terms, preferences, rights, limitations or restrictions of the preferred stock.
|
DESCRIPTION
OF WARRANTS
We
may issue warrants for the purchase of common stock. Warrants may be issued independently or together with other securities and
may be attached to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement.
The following outlines some of the general terms and provisions of the warrants that we may issue from time to time. Additional
terms of the warrants and the applicable warrant agreement will be set forth in the applicable prospectus supplement.
The
following descriptions, and any description of the warrants included in a prospectus supplement, may not be complete and is subject
to and qualified in its entirety by reference to the terms and provisions of the applicable warrant agreement, which we will file
with the Commission in connection with any offering of warrants.
General
The
prospectus supplement relating to a particular issue of warrants will describe the terms of the warrants, including the following:
●
|
the
title of the warrants;
|
|
|
●
|
the
offering price for the warrants, if any;
|
|
|
●
|
the
aggregate number of the warrants;
|
|
|
●
|
the
terms of the security that may be purchased upon exercise of the warrants;
|
|
|
●
|
if
applicable, the designation and terms of the securities that the warrants are issued with and the number of warrants issued
with each security;
|
|
|
●
|
if
applicable, the date from and after which the warrants and any securities issued with the warrants will be separately transferable;
|
●
|
the
dates on which the right to exercise the warrants commence and expire;
|
|
|
●
|
if
applicable, the minimum or maximum amount of the warrants that may be exercised at any one time;
|
|
|
●
|
if
applicable, a discussion of material United States federal income tax considerations;
|
|
|
●
|
anti-dilution
provisions of the warrants, if any;
|
|
|
●
|
redemption
or call provisions, if any, applicable to the warrants; and
|
|
|
●
|
any
additional terms of the warrants, including terms, procedures and limitations relating to the exchange and exercise of the
warrants.
|
Exercise
of warrants
Each
warrant will entitle the holder of the warrant to purchase the securities that we specify in the applicable prospectus supplement
at the exercise price that we describe in the applicable prospectus supplement. Holders may exercise warrants at any time up to
the close of business on the expiration date set forth in the applicable prospectus supplement. After the close of business on
the expiration date, unexercised warrants will be void. Holders may exercise warrants as set forth in the prospectus supplement
relating to the warrants being offered. Until a holder exercises the warrants to purchase any securities underlying the warrants,
the holder will not have any rights as a holder of the underlying securities by virtue of ownership of warrants.
Transfer
Agent
We
have appointed Equity Stock Transfer as our transfer agent. Their contact information is: 237 West 37th Street, Suite 601, New
York, New York 10018, phone number (917) 746-4595, facsimile (347) 584-3644.
CERTAIN
PROVISIONS OF DELAWARE LAW AND OF OUR CHARTER AND BYLAWS
Anti-takeover
Provisions
In
general, Section 203 of the Delaware General Corporation Law, or the DGCL, prohibits a Delaware corporation with a class of voting
stock listed on a national securities exchange or held of record by 2,000 or more shareholders from engaging in a “business
combination” with an “interested shareholder” for a three-year period following the time that this shareholder
becomes an interested shareholder, unless the business combination is approved in a prescribed manner. A “business combination”
includes, among other things, a merger, asset or stock sale or other transaction resulting in a financial benefit to the interested
shareholder. An “interested shareholder” is a person who, together with affiliates and associates, owns, or did own
within three years prior to the determination of interested shareholder status, 15% or more of the corporation’s voting
stock. Under Section 203, a business combination between a corporation and an interested shareholder is prohibited unless it satisfies
one of the following conditions:
●
|
before
the shareholder became interested, the board of directors approved either the business combination or the transaction which
resulted in the shareholder becoming an interested shareholder;
|
|
|
●
|
upon
consummation of the transaction which resulted in the shareholder becoming an interested shareholder, the interested shareholder
owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for
purposes of determining the voting stock outstanding, shares owned by persons who are directors and also officers, and employee
stock plans, in some instances; or
|
|
|
●
|
at
or after the time the shareholder became interested, the business combination was approved by the board of directors of the
corporation and authorized at an annual or special meeting of the shareholders by the affirmative vote of at least two-thirds
of the outstanding voting stock which is not owned by the interested shareholder.
|
The
DGCL permits a corporation to opt out of, or choose not to be governed by, its anti-takeover statute by expressly stating so in
its original certificate of incorporation (or subsequent amendment to its certificate of incorporation or bylaws approved by its
shareholders). Our Certificate of Incorporation does not contain a provision expressly opting out of the application of Section
203 of the DGCL; therefore we are subject to the anti-takeover statute.
Issuance
of “blank check” preferred stock
Our
Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of “blank check” preferred stock with
designations, rights and preferences as may be determined from time to time by our Board of Directors. Our Board is empowered,
without shareholder approval, to issue a series of preferred stock with dividend, liquidation, conversion, voting or other rights
which could dilute the interest of, or impair the voting power of, our common shareholders. The issuance of a series of preferred
stock could be used as a method of discouraging, delaying or preventing a change in control. For example, it would be possible
for our Board of Directors to issue preferred stock with voting or other rights or preferences that could impede the success of
any attempt to effect a change in control of our company.
Our
Bylaws also allow our Board of Directors to fix the number of directors. Our shareholders do not have cumulative voting in the
election of directors.
Special
Shareholder Meetings and Action by Written Consent
Under
our Bylaws,
special meetings of the shareholders shall be held when directed by (i) the
Board of Directors, or (ii) when requested in writing by the holders of not less than 20 percent of all the shares entitled to
vote at the meeting
. Our Bylaws do not permit meetings of shareholders to be called by any other person. This could have
the effect of delaying or preventing unsolicited takeovers and changes in control or changes in our management.
Indemnification
of Directors and Officers.
Section
145(a) of the DGCL, which Cocrystal is subject to, provides that a corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person
is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by
the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably
believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe the person’s conduct was unlawful. Section 145(b) of the DGCL provides that a corporation
may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action
or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was
a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including
attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action
or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests
of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such
person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which
the Court of Chancery or such other court shall deem proper. To the extent that a present or former director or officer of a corporation
has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in Section 145(a) and
(b) of the DGCL, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including
attorneys’ fees) actually and reasonably incurred by such person in connection therewith.
Any
indemnification under Section 145(a) and (b) of the DGCL (unless ordered by a court) shall be made by Cocrystal only as authorized
in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is
proper in the circumstances because the person has met the applicable standard of conduct set forth in Section 145(a) and (b).
Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1)
by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or
(2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if
there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the
shareholders. Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal,
administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition
of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount
if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this
section. Such expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents
may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. The indemnification and advancement
of expenses provided by, or granted pursuant to, Section 145 shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of shareholders or disinterested
directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while
holding such office. We have entered into Indemnification Agreements with each director and executive officer.
Section
145 of the DGCL also empowers a corporation to purchase and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted
against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether
or not the corporation would have the power to indemnify such person against such liability under Section 145.
Article
11 of Cocrystal’s Certificate of Incorporation provides that directors, officers, employees and agents shall be indemnified
to the fullest extent permitted by the DGCL.
Cocrystal
carries directors and officers liability coverages designed to insure its officers and directors and those of its subsidiaries
against certain liabilities incurred by them in the performance of their duties, and also providing for reimbursement in certain
cases to Cocrystal and its subsidiaries for sums paid to directors and officers as indemnification for similar liability.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling
persons pursuant to the foregoing provisions, or otherwise, Cocrystal has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
PLAN
OF DISTRIBUTION
We
may sell the securities offered by this prospectus from time to time in one or more transactions, including without limitation:
●
|
through
underwriters or dealers;
|
|
|
●
|
directly
to purchasers;
|
|
|
●
|
in
a rights offering;
|
|
|
●
|
in
“at the market” offerings, within the meaning of Rule 415(a)(4) of the Securities Act to or through a market maker
or into an existing trading market on an exchange or otherwise;
|
|
|
●
|
through
agents;
|
|
|
●
|
in
block trades;
|
|
|
●
|
through
a combination of any of these methods; or
|
|
|
●
|
through
any other method permitted by applicable law and described in a prospectus supplement.
|
In
addition, we may issue the securities as a dividend or distribution to our existing stockholders or other security holders.
The
prospectus supplement with respect to any offering of securities will include the following information:
●
|
the
terms of the offering;
|
|
|
●
|
the
names of any underwriters or agents;
|
|
|
●
|
the
name or names of any managing underwriter or underwriters;
|
|
|
●
|
the
purchase price or initial public offering price of the securities;
|
|
|
●
|
the
net proceeds from the sale of the securities;
|
|
|
●
|
any
delayed delivery arrangements;
|
|
|
●
|
any
underwriting discounts, commissions and other items constituting underwriters’ compensation;
|
●
|
any
discounts or concessions allowed or reallowed or paid to dealers;
|
|
|
●
|
any
commissions paid to agents; and
|
|
|
●
|
any
securities exchange on which the securities may be listed.
|
Sale
through Underwriters or Dealers
If
underwriters are used in the sale, the underwriters may resell the securities from time to time in one or more transactions, including
negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Underwriters may
offer securities to the public either through underwriting syndicates represented by one or more managing underwriters or directly
by one or more firms acting as underwriters. Unless we inform you otherwise in the applicable prospectus supplement, the obligations
of the underwriters to purchase the securities will be subject to certain conditions, and the underwriters will be obligated to
purchase all of the offered securities if they purchase any of them. The underwriters may change from time to time any initial
public offering price and any discounts or concessions allowed or reallowed or paid to dealers.
We
will describe the name or names of any underwriters, dealers or agents and the purchase price of the securities in a prospectus
supplement relating to the securities.
In
connection with the sale of the securities, underwriters may receive compensation from us or from purchasers of the securities,
for whom they may act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the securities to
or through dealers, and these dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters
and/or commissions from the purchasers for whom they may act as agents, which is not expected to exceed that customary in the
types of transactions involved. Underwriters, dealers and agents that participate in the distribution of the securities may be
deemed to be underwriters, and any discounts or commissions they receive from us, and any profit on the resale of the securities
they realize may be deemed to be underwriting discounts and commissions, under the Securities Act. The prospectus supplement will
identify any underwriter or agent and will describe any compensation they receive from us.
Underwriters
could make sales in privately negotiated transactions and/or any other method permitted by law, including sales deemed to be an
“at-the-market” offering, sales made directly on the OTCQB, the existing trading market for our shares of common stock,
or sales made to or through a market maker other than on the OTCQB. The name of any such underwriter or agent involved in the
offer and sale of our securities, the amounts underwritten, and the nature of its obligations to take our securities will be described
in the applicable prospectus supplement.
Unless
otherwise specified in the prospectus supplement, each series of the securities will be a new issue with no established trading
market, other than our shares of common stock, which are currently traded on the OTCQB. It is possible that one or more underwriters
may make a market in a series of the securities, but underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. Therefore, we can give no assurance about the liquidity of the trading market for any of the
securities.
Under
agreements we may enter into, we may indemnify underwriters, dealers, and agents who participate in the distribution of the securities
against certain liabilities, including liabilities under the Securities Act, or contribute with respect to payments that the underwriters,
dealers or agents may be required to make.
Any
compensation we pay underwriters or dealers will be subject to the guidelines of the Financial Industry Regulatory Authority,
Inc. We will disclose the compensation in any applicable prospectus supplement or pricing supplement, as the case may be.
To
facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize,
maintain, or otherwise affect the price of the securities. This may include over-allotments or short sales of the securities,
which involve the sale by persons participating in the offering of more securities than we sold to them. In these circumstances,
these persons would cover such over-allotments or short positions by making purchases in the open market or by exercising their
over-allotment option, if any. In addition, these persons may stabilize or maintain the price of the securities by bidding for
or purchasing securities in the open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating
in the offering may be reclaimed if securities sold by them are repurchased in connection with stabilization transactions. The
effect of these transactions may be to stabilize or maintain the market price of the securities at a level above that which might
otherwise prevail in the open market. These transactions may be discontinued at any time.
From
time to time, we may engage in transactions with these underwriters, dealers, and agents in the ordinary course of business.
Direct
Sales and Sales through Agents
We
may sell the securities directly. In this case, no underwriters or agents would be involved. We also may sell the securities through
agents designated by us from time to time. In the applicable prospectus supplement, we will name any agent involved in the offer
or sale of the offered securities, and we will describe any commissions payable to the agent. Unless we inform you otherwise in
the applicable prospectus supplement, any agent will agree to use its reasonable best efforts to solicit purchases for the period
of its appointment.
We
may sell the securities directly to institutional investors or others who may be deemed to be underwriters within the meaning
of the Securities Act with respect to any sale of those securities. We will describe the terms of any sales of these securities
in the applicable prospectus supplement.
Remarketing
Arrangements
Securities
also may be offered and sold, if so indicated in the applicable prospectus supplement, in connection with a remarketing upon their
purchase, in accordance with a redemption or repayment pursuant to their terms, or otherwise, by one or more remarketing firms,
acting as principals for their own accounts or as agents for us. Any remarketing firm will be identified and the terms of its
agreements, if any, with us and its compensation will be described in the applicable prospectus supplement.
Delayed
Delivery Contracts
If
we so indicate in the applicable prospectus supplement, we may authorize agents, underwriters or dealers to solicit offers from
certain types of institutions to purchase securities from us at the public offering price under delayed delivery contracts. These
contracts would provide for payment and delivery on a specified date in the future. The contracts would be subject only to those
conditions described in the applicable prospectus supplement. The applicable prospectus supplement will describe the commission
payable for solicitation of those contracts.
General
Information
We
may have agreements with the underwriters, dealers, agents and remarketing firms to indemnify them against certain civil liabilities,
including liabilities under the Securities Act, or to contribute with respect to payments that the underwriters, dealers, agents
or remarketing firms may be required to make. Underwriters, dealers, agents and remarketing firms may be customers of, engage
in transactions with or perform services for us in the ordinary course of their businesses.
LEGAL
MATTERS
The
validity of the securities offered hereby will be passed upon for us by Nason, Yeager, Gerson, White & Lioce, P.A., Palm Beach
Gardens, Florida.
EXPERTS
The
consolidated financial statements as of December 31, 2016 and 2015 and for each of the three years in the period ended December
31, 2016 and management’s assessment of the effectiveness of internal control over financial reporting as of December 31,
2016 incorporated by reference in this Prospectus have been so incorporated in reliance on the reports of BDO USA, LLP, an independent
registered public accounting firm (the report on the consolidated financial statements contains an explanatory paragraph regarding
the Company’s ability to continue as a going concern and the report on the effectiveness of internal control over financial
reporting expresses an adverse opinion on the effectiveness of the company’s internal control over financial reporting as
of December 31, 2016), incorporated herein by reference, given on the authority of said firm as experts in auditing and accounting.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
documents listed below are incorporated by reference into this registration statement:
●
|
Our
annual report on Form 10-K for the year ended December 31, 2016 filed on March 31, 2017 (as amended by the Form 10-K/A filed
April 27, 2017);
|
|
|
●
|
Our
quarterly report on Form 10-Q for the quarter ended March 31, 2017, filed on May 10, 2017 and our quarterly report on Form
10-Q for the quarter ended June 30, 2017, filed on August 8, 2017;
|
|
|
●
|
Our
current reports on Form 8-K filed on January 9, 2017, January 30, 2017, February 16, 2017, February 24, 2017, April 24, 2017,
and June 1, 2017;
|
|
|
●
|
The
description of our common stock in our registration statement on Form S-8 filed with the SEC on January 2, 2014, as updated
by any amendments and reports filed for the purpose of updating such description; and
|
|
|
●
|
All
documents subsequently filed pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange
Act”) prior to the termination of the offering, other than information furnished pursuant to Items 2.02 and 7.01 of
Form 8-K and any related exhibits, shall be deemed to be incorporated by reference into the prospectus.
|
Any
statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus is modified or superseded
for purposes of the prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement.
We
will provide to each person, including any beneficial owner, to whom a prospectus is delivered, a copy of any or all of the information
that has been incorporated by reference in this prospectus but not delivered with the prospectus.
We
are an Exchange Act reporting company and are required to file periodic reports on Form 10-K and 10-Q and current reports on Form
8-K. You may read and copy all or any portion of the registration statement or any other information, which we file at the SEC’s
public reference room at 100 F Street, N.E., Washington, DC 20549, Please call the SEC at 1-800-SEC-0330 for further information
on the operation of the public reference room. Also, the SEC maintains an internet site that contains reports, proxy and information
statements, and other information that we file electronically with the SEC, including the registration statement. The website
address is
www.sec.gov
.
Up
to $10,000,000
Common
Stock
PROSPECTUS
SUPPLEMENT
Ladenburg
Thalmann
|
|
Barrington
Research
|
A.G.P.
Offering
Securities Through Euro Pacific Capital, Inc.
July
19
, 2018
Cocrystal Pharma (NASDAQ:COCP)
Historical Stock Chart
From Aug 2024 to Sep 2024
Cocrystal Pharma (NASDAQ:COCP)
Historical Stock Chart
From Sep 2023 to Sep 2024