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As Filed With the Securities and Exchange Commission on November 15, 1996
Registration No. 333-________
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SECURITIES AND EXCHANGE COMMISSION
Washington. D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GISH BIOMEDICAL, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-3046028
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
2681 KELVIN AVENUE, IRVINE, CALIFORNIA 92714
(714) 756-5485
(Address, including zip code, and telephone number, including area code of
registrant's principal executive offices)
JACK BROWN
CHIEF EXECUTIVE OFFICER
GISH BIOMEDICAL, INC.
2681 KELVIN AVENUE, IRVINE, CALIFORNIA 92714
(714) 756-5485
(Name, address, including zip code, and telephone number, including area code
of agent for service)
COPY TO:
MICHAEL E. FLYNN, ESQ.
MATTHEW P. THULLEN, ESQ.
STRADLING, YOCCA, CARLSON & RAUTH
660 NEWPORT CENTER DRIVE, SUITE 1600
NEWPORT BEACH, CALIFORNIA 92660
Approximate date of commencement of proposed sale to public: AS SOON
AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
If the only securities being registered on this form are being
offered pursuant to dividend or interest reinvestment plans, please check the
following box. / /
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. / / __________
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. / / __________
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. / /
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CALCULATION OF REGISTRATION FEE
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Proposed maximum Proposed maximum
Title of securities Amount to be offering price aggregate offering Amount of
to be registered registered per share (1) price (1) registration fee
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Common Stock, no 240,240 $6.4375 $1,546,545 $468.65
par value shares
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(1) The offering price is estimated solely for the purpose of calculating
the registration fee in accordance with Rule 457(c) and (g), using
the average of the high and low price reported by the Nasdaq National
Market for the Common Stock on November 13, 1996, which was
approximately $6.4375 per share.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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PROSPECTUS SUBJECT TO COMPLETION
DATED NOVEMBER 15, 1996
GISH BIOMEDICAL, INC.
240,240 SHARES OF COMMON STOCK
(NO PAR VALUE)
This Prospectus relates to the offer and sale of shares of common
stock, no par value ("Common Stock"), of Gish Biomedical, Inc. (the "Company" or
"Gish"), which may be offered hereby from time to time by the selling
stockholder named herein (the "Selling Stockholder") for its own benefit. The
Company will receive no part of the proceeds of sales made hereunder. See "Use
of Proceeds." All expenses of registration incurred in connection with this
offering are being borne by the Company, but all selling and other expenses
incurred by the Selling Stockholder will be borne by such Selling Stockholder.
None of the shares offered pursuant to this Prospectus have been registered
prior to the filing of the Registration Statement of which this Prospectus is a
part.
The distribution of the shares of Common Stock offered hereby may be
effected from time to time in one or more transactions. All or a portion of the
shares of Common Stock offered hereby may be offered for sale, from time to
time, on the Nasdaq National Market (the "Nasdaq NM") in negotiated
transactions, or by a combination of these methods, at fixed prices that may be
changed, at market prices prevailing at the time of sale, at prices related to
such market prices or at negotiated prices. In addition, the Selling Stockholder
may elect to distribute, pursuant to the Registration Statement of which this
Prospectus is a part, the shares of Common Stock as a dividend to its
stockholders. In effecting sales, brokers or dealers engaged by the Selling
Stockholder may arrange for other brokers or dealers to participate. All
brokers' commissions, concessions or discounts will be paid by the Selling
Stockholder. See "Plan of Distribution."
The Selling Stockholder and any broker executing selling orders on
behalf of the Selling Stockholder may be deemed to be an "underwriter" within
the meaning of the Securities Act of 1933, as amended (the "Securities Act"), in
which event commissions received by such broker may be deemed to be underwriting
commissions under the Securities Act.
The Common Stock of the Company is registered pursuant to Section
12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and is listed on the Nasdaq NM under the symbol "GISH". On November 14, 1996,
the last reported sale price of the Company's Common Stock on the Nasdaq NM was
$6.75.
SEE "RISK FACTORS" BEGINNING ON PAGE 4 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE
COMMISSION NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The date of this Prospectus is , 1996.
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TABLE OF CONTENTS
PAGE
Available Information...........................................................2
Incorporation of Certain Documents by Reference.................................3
The Company.....................................................................4
Risk Factors....................................................................4
Use of Proceeds.................................................................7
Selling Stockholder.............................................................8
Plan of Distribution............................................................8
Legal Matters...................................................................9
Experts.........................................................................9
Indemnification of Directors and Officers.......................................9
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, IN CONNECTION
WITH THE OFFERING DESCRIBED HEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION
OF AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF THESE SECURITIES BY ANY
PERSON IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH
OFFER, SOLICITATION OR SALE. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Exchange Act and in accordance therewith files reports, proxy statements and
other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information can be
inspected and copied at the public reference facilities maintained by Commission
at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's regional offices at 500 West Madison Street, Chicago, Illinois
60606 and 7 World Trade Center, New York, New York 10048. Copies of such
material can also be obtained at prescribed rates from the Public Reference
Section of the Commission at its principal office at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549.
This Prospectus does not contain all of the information set forth in
the Registration Statement of which this Prospectus is a part and which the
Company has filed with the Commission. For further information with respect to
the Company and the securities offered hereby, reference is made to the
Registration Statement, including the exhibits filed as a part thereof, copies
of which can be inspected at, or obtained at prescribed rates from, the Public
Reference Section of the Commission at the address set forth above. Additional
updating information with respect to the Company may be provided in the future
by means of appendices of supplements to this Prospectus.
The Company's Common Stock is listed on the Nasdaq NM. Reports, proxy
statements and other information concerning the Company can be inspected at 1735
K Street, N.W., Washington D.C. 20006-1506.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by the Company with the
Commission under the Exchange Act and are incorporated by reference herein:
a. The Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1996;
b. The Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1996.
c. All other reports filed by the Company pursuant to Section
13(a) or 15(d) of the Exchange Act since the end of the
Company's fiscal year ended June 30, 1996; and
d. The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, filed pursuant
to Section 12 of the Exchange Act, including any amendments or
reports filed for the purpose of updating such description.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 and 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Prospectus and to be part hereof from the date of filing such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
or in any other subsequently filed document that also is or is deemed to be
incorporated by reference herein, modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Company will provide, without charge, to each person to whom a
copy of this Prospectus is delivered, upon written or oral request of such
person, a copy of any and all of the information that has been or may be
incorporated by reference herein (other than exhibits to such documents unless
such exhibits are specifically incorporated by reference into such documents).
Such requests should be directed to Chief Financial Officer, Gish Biomedical,
Inc., 2681 Kelvin Avenue, Irvine, California 92714, telephone number (714)
756-5485.
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THE COMPANY
The Company was incorporated in California in April 1976 under the
name "Gics Pharmaceuticals, Inc." In November 1981, the Company changed its name
to Gish Biomedical, Inc . The Company has one operating subsidiary: Gish
International, Inc. Unless the context otherwise requires, references to the
"Company" herein include Gish Biomedical, Inc. and its operating subsidiary. The
Company's headquarters and principal place of business are located at 2681
Kelvin Avenue, Irvine, California 92714, and its telephone number is (714)
756-5485.
RISK FACTORS
The following factors should be considered carefully in evaluating the
Company and its business before making an investment in the Common Stock offered
hereby, together with all of the other information set forth or incorporated by
reference in this Prospectus.
This Prospectus, including documents incorporated into this Prospectus
by reference, contains certain forward-looking statements that are based on
current expectations. In light of the important factors that can materially
affect results, including those set forth in this paragraph and below, the
inclusion of forward-looking information herein should not be regarded as a
representation by the Company or any other person that the objectives or plans
of the Company will be achieved. The Company may encounter competitive,
technological, financial and business challenges making it more difficult than
expected to continue to develop and market its products; the market may not
accept the Company's existing and future products; the Company may be unable to
retain existing key management personnel; and there may be other material
adverse changes in the Company's operations or business. Certain important
factors affecting the forward-looking statements made herein include, but are
not limited to (i) failure to obtain U.S. Food and Drug Administration approval
for its oxygenator which is currently in development, (ii) the lack of market
acceptance of its redesigned MyoManager or ambulatory infusion pump, (iii)
continued downward pricing pressures in the Company's targeted markets, (iv) the
continued acquisition of the Company's customers by certain of its competitors
and (v) the decision by the Company to replace its distributor network with a
direct sales force in certain geographic territories. Assumptions relating to
budgeting, marketing, product development and other management decisions are
subjective in many respects and thus susceptible to interpretations and periodic
revisions based on actual experience and business developments, the impact of
which may cause the Company to alter its marketing, capital expenditure or other
budgets, which may in turn affect the Company's financial position and results
of operations. The reader is therefore cautioned not to place undue reliance on
forward-looking statements contained herein, which speak as of the date of this
Prospectus.
COMPETITION
The medical device industry in general, and the market for products for
use in cardiovascular surgery in particular, is intensely competitive and
characterized by innovation and technological advances. Product differentiation
and performance, client service, reliability, cost and ease of use are important
competitive considerations in the medical device industry. The Company expects
that the current high levels of competition and technological change in the
medical device industry in general, and the cardiovascular surgery products
industry in particular, will continue to increase. Several companies offer
devices which compete with devices manufactured by the Company, including
Bentley Laboratories, a division of Baxter Health Care Corporation, Bard
Cardiopulmonary, Inc., a division of C.A. Bard, Inc., COBE Laboratories, Inc.,
Sorin Biomedical, Inc., a unit of Fiat Italy, Medtronic, Inc. and Stryker
Surgical. Most of the Company's competitors have longer operating histories and
significantly greater financial, technical, research, marketing, sales,
distribution and other resources than the Company. In addition, the Company's
competitors have greater name recognition than the Company and frequently offer
discounts as a competitive tactic. There can be no assurance that the Company's
current competitors or potential future competitors will not succeed in
developing or marketing technologies and products that are more effective or
commercially attractive than those that have been and are being developed by the
Company or that would render the Company's technologies and products obsolete or
noncompetitive, or that such companies will not succeed in obtaining regulatory
approval for, introducing or commercializing any such products prior to the
Company. Any of the above competitive developments could have a material adverse
effect on the Company's business, financial condition and results of operations.
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RISK OF DECLINING AVERAGE SELLING PRICES
The Company is currently facing and may continue to face increasing
pricing pressures from its current and future competitors, especially from
competitors in the cardiovascular surgery products market. As a result of such
pressures, the Company has been forced to lower the prices of certain of its
products in order to maintain market share. There can be no assurance that the
Company will be able to maintain its market share in the cardiovascular surgery
products market in the face of continuing pricing pressures. Over time, the
average selling prices for the Company's products may continue to decline as the
markets for these products continues to become more competitive. Any material
reduction in the prices for the Company's products would negatively affect the
Company's gross margin and would require the Company to increase unit sales in
order to maintain net sales.
RISK OF MARKET WITHDRAWAL OR PRODUCT RECALL
Complex medical devices, such as the Company's products, can experience
performance problems in the field that require review and possible corrective
action by the manufacturer. Similar to many other medical device manufacturers,
the Company periodically receives reports from users of its products relating to
performance difficulties they have encountered. The Company expects that it will
continue to receive customer reports regarding the performance and use of its
products. There can be no assurance that component failures, manufacturing
errors or design defects that could result in an unsafe condition or injury to
the patient will not occur. If any such failures or defects were deemed serious,
the Company could be required to withdraw or recall products, which could result
in significant costs to the Company. However, there can be no assurance that
market withdrawals or product recalls will not occur in the future. Any future
product problems could result in market withdrawals or recalls of products,
which could have a material adverse affect on the Company's business, financial
condition or results of operations.
The Company has recently undertaken a voluntary recall of its
ambulatory infusion pumps. There can be no assurance that the Company will be
able to successfully take corrective actions with respect to these pumps, nor
can there be any assurance that any such corrective actions will not force the
Company to incur significant costs. In addition, there can be no assurance that
the current recall or any future recalls will not cause the Company to face
increasing scrutiny from its customers, which could cause the Company to lose
market share or incur substantial costs in order to maintain existing market
share.
RISKS ASSOCIATED WITH EXTENSIVE GOVERNMENT REGULATION
The manufacture and sale of medical devices, including products
currently sold by the Company and the Company's other potential products, are
subject to extensive regulation by numerous governmental authorities in the
United States, principally the FDA, and corresponding state agencies, such as
the California Department of Health Services ("CDHS"). In order for the Company
to market its products for clinical use in the United States, the Company must
obtain clearance from the FDA of a 510(k) premarket notification or approval of
a more extensive submission known as a premarket approval ("PMA") application.
In addition, certain material changes to medical devices also are subject to FDA
review and clearance or approval. The process of obtaining FDA and other
required regulatory clearances and approvals is lengthy, expensive and
uncertain, frequently requiring from one to several years from the date of FDA
submission if premarket clearance or approval is obtained at all. Securing FDA
clearances and approvals may require the submission of extensive clinical data
and supporting information to the FDA. The Company is currently awaiting
clearance of 510(k) premarket notification for a new oxygenator product which
the Company expects to receive by January 1997.
Sales of medical devices outside of the United States are subject to
international regulatory requirements that vary from country to country. The
time required to obtain approval for sales internationally may be longer or
shorter than that required for FDA clearance or approval, and the requirements
may differ. The Company has entered into distribution agreements for the foreign
distribution of its products. These agreements generally require that the
foreign distributor is responsible for obtaining all necessary regulatory
approvals in order to allow sales of the Company's products in a particular
country. There can be no assurance that the Company's foreign distributors will
be able to obtain approval in a particular country for any future products of
the Company.
Regulatory clearances or approvals, if granted, may include significant
limitations on the indicated uses for which the product may be marketed. In
addition, to obtain such clearances or approvals, the FDA and certain foreign
regulatory authorities impose numerous other requirements with which medical
device manufacturers must
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comply. FDA enforcement policy strictly prohibits the marketing of cleared or
approved medical devices for uncleared or unapproved uses. In addition, product
clearances or approvals could be withdrawn for failure to comply with regulatory
standards or the occurrence of unforeseen problems following the initial
marketing. The Company will be required to adhere to applicable FDA regulations
regarding good manufacturing practices ("GMP") and similar regulations in other
countries, which include testing, control, and documentation requirements.
Ongoing compliance with GMP and other applicable regulatory requirements will be
monitored through periodic inspections by federal and state agencies, including
FDA and CDHS, and by comparable agencies in other countries. Failure to comply
with applicable regulatory requirements, including marketing products for
unapproved uses, could result in, among other things, warning letters, fines,
injunctions, civil penalties, recall or seizure of products, total or partial
suspension of production, refusal of the government to grant premarket clearance
or premarket approval for devices, withdrawal of clearances or approvals and
criminal prosecution. Changes in existing regulations or adoption of new
governmental regulations or policies could prevent or delay regulatory approval
of the Company's products.
There can be no assurance that the Company will be able to obtain FDA
510(k) clearance or PMA approval for its potential products or other necessary
regulatory approvals or clearances on a timely basis or at all. Delays in
receipt of or failure to receive U.S. or foreign clearances or approvals, the
loss of previously obtained clearances or approvals, or failure to comply with
existing or future regulatory requirements would have a material adverse effect
on the Company's business, financial condition and results of operations.
PRODUCT LIABILITY RISK; LIMITED INSURANCE COVERAGE
The manufacture and sale of medical products entail significant risk of
product liability claims. There can be no assurance that the Company's existing
annual insurance coverage limits of $5 million per occurrence and $5 million in
the aggregate will be adequate to protect the Company from any liabilities it
might incur in connection with the clinical trials or sales of its products. In
addition, the Company may require increased product liability coverage as
products under development are successfully commercialized. Such insurance is
expensive and in the future may not be available on acceptable terms, or at all.
A successful product liability claim or series of claims brought against the
Company in excess of its insurance coverage, could have a material adverse
effect on the Company's business, financial condition and results of operations.
RISKS RELATING TO NEW PRODUCT DEVELOPMENT
The Company's growth is dependent in part on the design and development
of new products in the medical device industry. The product development process
is time-consuming and costly, and there can be no assurance that product
development will be successfully completed, that necessary regulatory clearances
or approvals will be granted by the FDA on a timely basis, or at all, or that
the potential products will achieve market acceptance. Failure by the Company to
develop, obtain necessary regulatory clearances or approvals for, or
successfully market potential new products could have a material adverse effect
on the Company's business, financial conditions and results of operations.
DEPENDENCE UPON KEY PERSONNEL
The Company is dependent upon a number of key management and technical
personnel. The loss of the services of one or more key employees would have a
material adverse effect on the Company. The Company's success will also depend
on its ability to attract and retain additional highly qualified management and
technical personnel. The Company faces intense competition for qualified
personnel, many of whom are often subject to competing employment offers, and
there can be no assurance that the Company will be able to attract and retain
such personnel.
RISKS ASSOCIATED WITH HEALTHCARE REFORM PROPOSALS
Political, economic and regulatory influences are subjecting the
healthcare industry in the United States to fundamental change. The Clinton
administration has expressed a continuing commitment to increasing access to
healthcare for the uninsured, and both the President and the Congress have
expressed interest in controlling the escalation of healthcare expenditures and
using healthcare reimbursement policies to help control the federal deficit.
Potential reforms proposed over the last several years have included mandated
basic healthcare benefits, controls
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on healthcare spending through limitations on the growth of private health
insurance premiums and Medicare and Medicaid spending, the creation of large
insurance purchasing groups and fundamental changes in the healthcare delivery
system. In addition, some states in which the Company operates are also
considering various healthcare reform proposals. The Company anticipates that
federal and state governments will continue to review and assess alternative
healthcare delivery systems and payment methodologies and public debate of these
issues will likely continue in the future. Due to uncertainties regarding the
ultimate features of reform initiatives and their enactment and implementation,
the Company cannot predict which, if any, of such reform proposals will be
adopted,when they may be adopted or what impact they may have on the Company,
and there can be no assurance that the adoption of reform proposals will not
have a material adverse effect on the Company's business, operating results or
financial condition. In addition, the actual announcement of reform proposals
and the investment community's reaction to such proposals, as well as
announcements by competitors and third-party payors of their strategies to
respond to such initiatives, could produce volatility in the trading and market
price of the Common Stock.
RISKS ASSOCIATED WITH ENVIRONMENTAL COMPLIANCE
In the ordinary course of its manufacturing process, the Company uses
solvents and isopropyl alcohol which are stored on-site. The waste created by
the use of these products is transported off-site on a regular basis by a
state-registered waste hauler. Although the Company is not aware of any claim
involving violation of environmental or occupational safety and health laws and
regulations, there can be no assurance that such a claim may not arise in the
future, which may have a material adverse effect on the Company.
CONTROL BY DIRECTORS AND EXECUTIVE OFFICERS
The Company's directors and executive officers will, in the aggregate,
beneficially own approximately 24% of the Company's outstanding Common Stock
following the completion of this offering. These shareholders, if acting
together, would be able to control substantially all matters requiring approval
by the shareholders of the Company, including the election of directors and the
approval of mergers or other business combination transactions. Such
concentration of ownership could discourage or prevent a change in control of
the Company.
ADVERSE EFFECTS OF PREFERRED STOCK ON RIGHTS OF COMMON STOCK
The Board of Directors of the Company is authorized to issue, from time
to time, without any action on the part of the Company's shareholders, up to
1,500,000 shares of Preferred Stock in one or more series, with such relative
rights, preferences, privileges and restrictions as are determined by the Board
of Directors at the time of issuance. Accordingly, the Board of Directors is
empowered to issue Preferred Stock with dividend, liquidation, conversion,
voting or other rights which could adversely affect the voting power or other
rights of the holders of Common Stock. In the event of such issuance, the
Preferred Stock could be utilized as a method of discouraging, delaying or
preventing a change in control of the Company.
VOLATILITY OF STOCK PRICE; NO DIVIDENDS
The trading price of the Common Stock has been and is likely to
continue to be subject to significant fluctuations in response to variations in
quarterly operating results, the gain or loss of significant contracts, changes
in management, announcements of technological innovations or new products by the
Company or its competitors, legislative or regulatory changes, general trends in
the industry and other events and factors. In addition, the stock market has
experienced extreme price and volume fluctuations which have affected the market
price for any companies for reasons frequently unrelated to the operating
performance of these companies. These broad market fluctuations may adversely
affect the market price of the Company's Common Stock. The Company currently
intends to retain any future earnings for use in its business and does not
anticipate any cash dividends in the future.
USE OF PROCEEDS
The proceeds from the sale of the Selling Stockholder's Common Stock
will belong to the Selling Stockholder. The Company will not receive any
proceeds from any such sale of the Common Stock.
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SELLING STOCKHOLDER
The following table sets forth the name of the Selling Stockholder,
the nature of any material relationship with the Company within the past three
years, if applicable, the number of shares of Common Stock owned by such Selling
Stockholder prior to the offering, and the number of shares and (if one percent
or more) the percentage of the class to be owned by such Selling Stockholder
after the offering.
Shares Owned
After Offering(1)
Shares Owned Shares ------------------
Name Prior to Offering Offered Number Percent
- ---- ----------------- ------- ------ -------
Creative Medical Development, Inc. 240,240 240,240 -- --
(1) Assumes the Selling Stockholder sells all of the shares offered hereby.
On September 13, 1995, the Company and the Selling Stockholder entered
into an agreement whereby the Selling Stockholder sold substantially all of its
ambulatory infusion pump assets to the Company in exchange for 240,240 shares of
Common Stock and a cash payment of $600,000. This transaction was consummated on
April 17, 1996. In connection with and at the consummation of this transaction,
the Company entered into a one-year lease with a subsidiary of the Selling
Stockholder with respect to property housing the equipment used to manufacture
the assets acquired. The Company also entered into one-year employment
agreements at the consummation of this transaction with the Selling
Stockholder's Chief Executive Officer and Secretary/Treasurer. The agreement
with the Chief Executive Officer of the Selling Stockholder provides for an
annual salary of $110,000, with vacation and other benefits in accordance with
the Company's general personnel policies, and further provides for stock awards
which vest over the life of the agreement, as well as bonuses and options to be
granted in the event certain performance targets are met. The agreement with the
Secretary/Treasurer of the Selling Stockholder provides for an annual salary of
$96,000, with vacation and other benefits in accordance with the Company's
general personnel policies, as well as stock awards which vest over the term of
the agreements and a stock bonus to be granted on the satisfaction of an
administrative transition between the Company and the Selling Stockholder with
respect to the ambulatory infusion pump assets sold to the Company.
PLAN OF DISTRIBUTION
The Company will not receive any of the proceeds from the sale of
shares of Common Stock offered hereby. The Selling Stockholder may sell all or a
portion of the shares of Common Stock held by it from time to time while the
Registration Statement of which this Prospectus is a part remains effective. By
agreement with the Selling Stockholder, the Company is obligated to maintain the
effectiveness of such Registration Statement until the earlier of April 17, 1998
or the date all of the shares of Common Stock offered hereby have been sold or
withdrawn from registration by the Selling Stockholder. To the extent required,
the number of shares of Common Stock to be sold, the name(s) of the Selling
Stockholder(s), the purchase price, the name of any agent or dealer and any
applicable commissions with respect to a particular offer will be set forth in
an accompanying Supplement to this Prospectus. The aggregate proceeds to the
Selling Stockholder from the sale of shares of Common Stock offered by the
Selling Stockholder hereby will be the prices at which such securities are sold,
less any commissions. There is no assurance that the Selling Stockholder will
sell any or all of the shares of Common Stock offered hereby.
The shares of Common Stock may be sold by the Selling Stockholder in
transactions on the Nasdaq NM, in negotiated transactions, or by a combination
of these methods, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to such market prices or at
negotiated prices. The Selling Stockholder may elect to engage a broker or
dealer to effect sales in one or more of the following transactions: (a) block
trades in which the broker or dealer so engaged will attempt to sell the shares
as agent but may position and resell a portion of the block as principal to
facilitate the transaction, (b) purchases by a broker or dealer as principal and
resale by such broker or dealer for its account pursuant to this Prospectus, and
(c) ordinary brokerage transactions and transactions in which the broker
solicits purchasers. In addition, the Selling Stockholder may elect to
distribute, pursuant to the Registration Statement of which this Prospectus is a
part, the shares of Common Stock as a dividend to its stockholders. In effecting
sales, brokers and dealers engaged by Selling Stockholder may
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arrange for other brokers or dealers to participate. Brokers or dealers may
receive commissions or discounts from the Selling Stockholder in amounts in
amounts to be negotiated (and, if such broker-dealer acts as agent for the
purchaser of such shares, from such purchaser). Broker-dealers may agree with
the Selling Stockholder to sell a specified number of such shares at a
stipulated price per share, and, to the extent such broker-dealer is unable to
do so acting as agent for the Selling Stockholder, to purchase as principal any
unsold shares at the price required to fulfill the broker-dealer commitment to
the Selling Stockholder. Broker-dealers who acquire shares as principal may
thereafter resell such shares from time to time in transactions (which may
involve crosses and block transaction and sales to and through other
broker-dealers, including transactions of the nature described above) in the
over-the-counter market or otherwise at prices and on terms then prevailing at
the time of sale, at prices then related to the then-current market price or in
negotiated transactions and, in connection with such resales, may pay to or
receive from the purchasers of such shares commissions as described above.
The Selling Stockholder and any broker-dealers or agents that
participate with the Selling Stockholder in sales of the shares of Common Stock
may be deemed to be "underwriters" within the meaning of the Securities Act in
connection with such sales. In such event, any commissions received by such
broker-dealers or agents and any profit on the resale of the shares of Common
Stock purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.
Pursuant to the registration agreement entered into with the Selling
Stockholder, the Company has agreed to indemnify the Selling Stockholder against
certain liabilities, including liabilities under the Securities Act.
The Company will pay all expenses incident to the registration of the
offer and sale of the shares of Common Stock to the public. All selling and
other expenses incurred by the Selling Stockholder, including selling
commissions and fees, are to be paid by the Selling Stockholder.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will be
passed upon for the Company by Stradling, Yocca, Carlson & Rauth, a Professional
Corporation, Newport Beach, California.
EXPERTS
The consolidated financial statements of Gish Biomedical, Inc.
appearing incorporated by reference in Gish Biomedical, Inc.'s Annual Report
(Form 10-K) for the year ended June 30, 1996 have been audited by Ernst & Young
LLP, independent auditors, as set forth in their report included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles of Incorporation provides that to the fullest
extent permitted by California law, a director will not be liable for monetary
damages for breach of the director's fiduciary duty of care to the Company and
its stockholders. This provision in the Articles of Incorporation does not
eliminate a director's fiduciary duty of care, and, in appropriate
circumstances, equitable remedies such as an injunction or other forms of
non-monetary relief would remain available under California law. Each director
will continue to be subject to liability for (i) acts or omissions that involve
intentional misconduct or a knowing and culpable violation of law, (ii) acts or
omissions that the director believes to be contrary to the best interests of the
Company or its stockholders or involve the absence of good faith on the part of
the director, (iii) any transaction from which the director derives an improper
personal benefit, (iv) acts or omissions involving reckless disregard for the
director's duty to the Company or its stockholders when the director was aware
or should have been aware of the risk of serious injury to the Company or its
stockholders, (v) acts or omissions that constitute an unexpected pattern of
inattention that amounts to an abdication of the director's duty to the Company
or its stockholders, (vi) improper transactions between a director and the
Company, and (vii) improper distributions and loans to directors and officers.
This provision does not affect
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a director's responsibilities under any laws, such as the federal securities
laws or state or federal environmental laws.
In addition, the Company's Bylaws provide that the Company may
indemnify its directors, officers, employees and other agents to the fullest
extent permitted by California law. The Company is also empowered under its
Bylaws to enter into indemnification contracts with its directors and officers
and to purchase insurance on behalf of any person whom the Company is required
or permitted to indemnify. The Company has entered into agreements with its
directors and executive officers, which requires the Company to indemnify them
to the fullest extent permitted by law against certain losses they may incur in
legal proceedings arising in connection with their services to the Company.
Insofar as indemnification for liabilities under the Securities Act
may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in the
opinion of the Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
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No dealer, salesperson or any other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company. This Prospectus does
not constitute an offer to sell or a solicitation of an offer to buy to any
person in any jurisdiction in which such offer or solicitation would be unlawful
or to any person to whom it is unlawful. Neither the delivery of this Prospectus
nor any offer or sale made hereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of the Company or that
information contained herein is correct as of any time subsequent to the date
hereof.
----------------------------------------------------------
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240,240 SHARES
GISH BIOMEDICAL, INC.
COMMON STOCK
PROSPECTUS
, 1996
----------------------------------------------------------
----------------------------------------------------------
14
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 14. Other Expenses of Issuance and Distribution
The following sets forth the costs and expenses, all of which shall be
borne by the Company, in connection with the offering of the shares of Common
Stock pursuant to this Registration Statement:
Securities and Exchange Commission Fee....................... $ 469.00
Accounting Fees and Expenses................................. $ 5,000.00*
Legal Fees and Expenses...................................... $10,000.00*
Miscellaneous Expenses....................................... $ 3,000.00*
---------
Total............................................... $18,469.00
* Estimated
Item 15. Indemnification of Directors and Officers.
(a) As permitted by the California General Corporation Law, the
Company's Articles of Incorporation eliminates the liability of directors to the
Company or its stockholders for monetary damages for breach of fiduciary duty as
a director, except to the extent otherwise required by the California General
Corporation Law.
(b) The Company's Articles of Incorporation provides that the Company
will indemnify each person who was or is made a party to any proceeding by
reason of the fact that such person is or was a director or officer of the
Company against all expense, liability and loss reasonably incurred or suffered
by such person in connection therewith to the fullest extent authorized by the
California General Corporation Law. The Company's Bylaws provide for a similar
indemnity to directors and officers of the Company to the fullest extent
authorized by the California General Corporation Law.
(c) The Company's Articles of Incorporation also gives the Company the
ability to enter into indemnification agreements with each of its officers and
directors. The Company has entered into indemnification agreements with each of
its directors and officers. The indemnification agreements provide for the
indemnification of directors and officers of the Company against any and all
expenses, judgments, fines, penalties and amounts paid in settlement, to the
fullest extent permitted by laws.
Item 16. Exhibits.
4.1 Registration Rights Agreement dated as of April 17, 1996, by
and among the Company and Creative Medical Development, Inc.,
a Delaware corporation.
5.1 Opinion of Stradling, Yocca, Carlson & Rauth, a Professional
Corporation.
23.1 Consent of Stradling, Yocca, Carlson & Rauth, a Professional
Corporation (included in Exhibit 5.1).
23.2 Consent of Ernst & Young LLP.
24.1 Power of Attorney (included on the signature page to the
Registration Statement - see page S-1.)
II-1
15
Item 17. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933 (the
"Securities Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule
424(b). If, in the aggregate, the changes in volume
and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement.
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement.
Provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the registration statement is on
Form S-3 of S-8, and the information required to be included
in a post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
(the "Exchange Act") that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d)
of the Exchange Act, (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the
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opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Irvine, State of California, on the 14th day of
November, 1996.
GISH BIOMEDICAL, INC.
By: /s/ Jack W. Brown
-------------------------------------
Jack W. Brown
Chief Executive Officer and President
POWER OF ATTORNEY
We, the undersigned officers and directors of Gish Biomedical, Inc., do
hereby constitute and appoint Jack W. Brown and Jeanne M. Miller, or either of
them, our true and lawful attorneys-in-fact and agents, each with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, or any related Registration
Statement that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and to file the same, with exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite or necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that each of said attorneys-in-fact and agents, or his substitute
or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
--------- ----- ----
Chief Executive Officer,
/s/ Jack W. Brown President and Director
- ----------------------------- (Principal Executive Officer) November 14, 1996
Jack W. Brown
Vice President and Chief Financial
/s/ Jeanne M. Miller Officer
- ----------------------------- (Principal Financial officer) November 14, 1996
Jeanne M. Miller
President and Director
(Principal Executive Officer)
- ----------------------------- Director November 14, 1996
Richard A. Braun
/s/ Ray R. Coulter Director November 14, 1996
- -----------------------------
Ray R. Coulter
S-1
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/s/ Richard W. Dutrisac Director November 14, 1996
- -----------------------------
Richard W. Dutrisac
/s/ James B. Glavin Director November 14, 1996
- -----------------------------
James B. Glavin
/s/ John S. Hagestad Director November 14, 1996
- -----------------------------
John S. Hagestad
S-2
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EXHIBIT INDEX
Exhibit Sequential
Number Description Page Number
- ----- ----------- -----------
4.1 Registration Rights Agreement dated as of April 17, 1996, by and
among the Company and Creative Medical Development, Inc., a
Delaware corporation.
5.1 Opinion of Stradling, Yocca, Carlson & Rauth, a Professional
Corporation.
23.1 Consent of Stradling, Yocca, Carlson & Rauth, a Professional
Corporation (included in Exhibit 5.1).
23.2 Consent of Ernst & Young LLP.
24.1 Power of Attorney (included on signature page to the Registration
Statement at page S-1).