Published on May 8, 2007
File
No. 2311-4
May
8,
2007
Via
FedEx and Edgar
Mr. Russell
Mancuso
Branch
Chief
United
States Securities and Exchange Commission
Office
of
Emerging Growth Companies
Mail
Stop
3561
100
F
Street, N.E.
Washington,
D.C. 20549
|
Re:
|
Lixte
Biotechnology Holdings, Inc.
Amendment
No. 4 to Form SB-2
Filed
April 19, 2007
File
No. 333-137208
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Dear
Mr. Mancuso:
On
behalf
of our client, Lixte Biotechnology Holdings, Inc. (“Lixte”), we are responding
to the comments of the Staff of the Securities and Exchange Commission set
forth
in your letter, dated May 3, 2007, to John S. Kovach of Lixte regarding the
above-referenced Form SB-2. As in our previous response letters, we have set
forth below each of the Staff’s numbered comments, followed by Lixte’s response.
We are concurrently filing herewith Amendment No. 5 to Form SB-2.
Summary,
page 1
| 1. |
If
your “exclusive license” from the NIH is subject to terms that are unknown
or to be negotiated in the future, please balance your discussion
regarding the license here and throughout your document
accordingly.
|
Company
Response
We
have
received a draft of a license agreement from NIH. We anticipate negotiating
the
economic terms, but we know from the draft the outside parameters of such terms
which we have disclosed in the Amendment.
Mr. Russell
Mancuso
May
8,
2007
Page 2
Management’s
Discussion and Analysis of Financial Condition . . . page 24
| 2. |
We
note your revised disclosure in response to comment two in our letter
to
you dated April 3, 2007. That comment also sought clarification on
how the penalties affect the proceeds from this transaction, and
your
liquidity. Therefore, we reissue the
comment.
|
Company
Response
We
have
disclosed the effect of the penalties in the MD&A and the Notes to the
Financial Statements.
| 3. |
Please
file as an exhibit the agreement mentioned in Exhibit
2.4.
|
Company
Response
We
have
filed the agreement as Exhibit 2.5.
Intellectual
Property, page 34
| 4. |
We
note your response to prior comment five. Please revise to clarify
whether
your provisional patent application fails under your CRADA agreement.
Explain the scope of your rights to the intellectual property if
it is not
defined by the agreement. Also, with a view toward disclosure, please
tell
us the status of the December 2006 agreement mentioned in response
19 to
your December 1, 2006 letter to
us.
|
Company
Response
We
have
disclosed that the provisional patent application does not fall under the CRADA
agreement and we have sole rights to any patent issued thereunder. As is clear
in the Registration Statement, the “December 2006” agreement (which is the
agreement with the University of Regensburg) was executed in January
2007.
Financial
Statements
Note
8. Restatement, page F-16
| 5. |
We
note that you restated your December 31, 2006 financial statement to
recognize a charge of $74,000 for estimated liquidated damages under
the
registration rights agreement associated with the shares of common
stock
sold in 2006 but not yet registered with the SEC. Please tell us
why
Amendment 3 of your Form SB-2 did not discuss your early adoption
of EITF
00-19-2. Also, please tell us why you did not file an Item 4.02
Form 8-K disclosing when you concluded that your prior financial
statements and all financial press releases and similar communications
issued by the Company with respect to such statement of operation
and
balance sheet for the year ended December 31, 2006 should no longer
be relied upon. Please file any Item 4.02 Form 8-K necessary based
on our
concerns.
|
Mr.
Russell Mancuso
May
8, 2007
Page
3
Company
Response
Amendment
No. 3 to the Company’s Registration Statement on Form SB-2, which contained the
Company’s December 31, 2006 audited financial statements, was filed with the
Commission on March 13, 2007, and the Company’s Annual Report on Form 10-KSB for
the fiscal year ended December 31, 2006, which also contained the Company’s
December 31, 2006 audited financial statements, was filed with the Commission
on
March 29, 2007. Due to an inadvertent oversight by the Company, such December
31, 2006 audited financial statements did not properly account for registration
penalty arrangements related to the 2006 private placement of the Company’s
common stock. When the Company became aware of such oversight, it promptly
revised its December 31, 2006 audited financial statements to early adopt,
as
permitted, EITF 00-19-2 and to accrue estimated liquidated damages payable
under
the registration rights agreement of $74,000 at such date. The revised December
31, 2006 audited financial statements were included in Amendment No. 4 to the
Company’s Registration Statement on Form SB-2 (filed with the Commission on
April 19, 2007) and in the Company’s Annual Report on Form 10-KSB/A for the
fiscal year ended December 31, 2006 (filed with the Commission on April 23,
2007).
Based
on
the aforementioned comment from the Staff, the Company has prepared and filed
an
Item 4.02 Form 8-K to disclose that the Company’s December 31, 2006 financial
statements, as originally included in Amendment No. 3 to the Company’s
Registration Statement on Form SB-2 and in the Company’s Annual Report on Form
10-KSB for the fiscal year ended December 31, 2006, should no longer be relied
upon. The Company did not issue any financial press releases or similar
communications with respect to such financial statements.
| 6. |
In
addition, please have your auditor tell us what consideration they
have
given to revising the audit report date in light of the restatement
of the
financial statements to properly account for the estimated liquidated
damages resulting from early adoption of EITF 00-19-2. Refer to AICPA
Auditing Standards Section 561.06.a for further
guidance.
|
Mr.
Russell Mancuso
May
8, 2007
Page
4
Company
Response
The
Company’s auditor has considered the guidance in AICPA Auditing Standards
Section 561.06.a and has reissued their audit report on the Company's 2006
financial statements with a new paragraph that refers to the restatement and
that reflects an appropriate dual date.
* * *
All
questions and comments regarding the foregoing should be addressed to me at
(310) 789-1290.
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Very
truly yours,
/s/
David L. Ficksman
|
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DLF/wp
| cc: |
John
Kovach, M.D.
Dale
Campbell
Robert
Weingarten
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