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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 28, 1999
REGISTRATION NO. 333-
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
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BIO-PLEXUS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
CONNECTICUT
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
06-1211921
(I.R.S. EMPLOYER IDENTIFICATION NO.)
129 RESERVOIR ROAD
VERNON, CONNECTICUT 06066
(860) 870-6112
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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RICHARD L. HIGGINS
PRESIDENT AND CHIEF EXECUTIVE OFFICER
BIO-PLEXUS, INC.
129 RESERVOIR ROAD
VERNON, CONNECTICUT 06066
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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COPIES TO:
WALTER W. SIMMERS, ESQ.
PEPE & HAZARD LLP
GOODWIN SQUARE
225 ASYLUM STREET
HARTFORD, CONNECTICUT 06103-4302
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
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 of 1933, 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 of 1933, 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 EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED(1) PER SHARE(2) PRICE REGISTRATION FEE
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Common Stock, without par
value............................ 3,500,000 $5.75 $20,125,000 $5,595
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(1) Represents shares issuable upon conversion of debentures (and interest
accrued thereon) in the original aggregate principal amount of $2,500,000
and 500,000 shares issuable upon exercise of warrants each issued by the
Registrant to certain institutional investors in a private placement
transaction. See "Selling Stockholders" for a description of certain
assumptions made by the Registrant to determine the number of shares of
Common Stock to be registered hereunder. Pursuant to Rule 416 under the
Securities Act of 1933, any additional shares of Common Stock issued either
as a result of the provisions of the debentures or warrants pursuant to
which the Common Stock will be issued or by reason of a reduction in the
conversion price of the debentures or exercise price of the warrants in
accordance with the respective terms thereof are deemed to be registered
herewith.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) under the Securities Act, based upon the average of the high
and low prices for the Registrant's Common Stock on the Nasdaq SmallCap
Market on May 25, 1999, and the maximum aggregate offering price of
$20,125,000 is the product of $5.75 and the number of shares of the
Registrant's Common Stock being registered hereby.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT WILL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT WILL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT WILL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
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EXPLANATORY NOTE
This Registration Statement on Form S-3 (Registration No. 333- ) (the
"Registration Statement") of Bio-Plexus, Inc. (the "Company") registers
3,500,000 shares of Common Stock for resale by the holders thereof. Such shares
represent (i) 816,993 shares of Common Stock (the "Conversion Shares") issuable
upon the conversion of the $2,500,000 original aggregate principal amount of 6%
Convertible Debentures due 2004 (the "Debentures") issued in a private placement
in April, 1999 (the "April Offering"), (ii) an additional indeterminate amount
of shares of Common Stock (the "PIK Shares") that may be issued as interest
accrued on the Debentures, (iii) 500,000 shares of Common Stock issuable upon
the exercise of warrants issued in the April Offering, and (iv) additional
shares of Common Stock that may be issued as a result of adjustments to the
Debentures and Warrants in amounts agreed upon between the Company and the
selling stockholders. The number of Conversion Shares is not currently
calculable and cannot be calculated until conversion of the Debentures, because
it is based on a conversion price that is equal to the lesser of (a) a "Fixed
Conversion Price" of initially $3.06 per share and subject to adjustments, or
(b) a "Floating Conversion Price" calculated based on the average of the five
lowest closing prices during the thirty-five trading days preceding the date of
conversion. The number of shares issuable upon such conversion will vary
inversely with the market price of the Common Stock. However, for purposes of
calculating the number of shares of Common Stock included in this Registration
Statement, we have determined by agreement with the selling stockholders to
register that number of shares which represent 200% of the Conversion Shares and
Warrant Shares issuable on the closing date of the April Offering or the date
this Registration Statement is initially filed with the Securities and Exchange
Commission whichever produces the greatest number of registrable securities. The
Company calculated the number of Conversion Shares based on an assumed
conversion price of $2.00, which represents the Floating Conversion Price in
effect on April 21, 1999, the closing date of the April Offering. The actual
number of shares of Common Stock issuable upon conversion of the Debentures
could be materially more or less than the number of shares registered hereunder.
All of the Conversion Shares will be sold for the accounts of the selling
stockholders and the Company will receive no proceeds therefrom.
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SUBJECT TO COMPLETION, DATED MAY 28, 1999
PROSPECTUS
BIO-PLEXUS, INC.
3,500,000 SHARES
COMMON STOCK
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On behalf of certain shareholders ("Selling Stockholders") of the
Bio-Plexus, Inc. ("Bio-Plexus" or the "Company"), we are registering for resale
up to 3,500,000 shares of our common stock, without par value ("Common Stock").
See "Selling Stockholders" for more information. The shares that we are
registering consist of:
(i) 816,993 shares (the "Conversion Shares") issuable upon conversion
of the $2,500,000 original aggregate principal amount of the Company's
outstanding 6% Convertible Debentures due 2004 (the "Debentures") issued in
a private placement in April, 1999 (the "April Offering");
(ii) an additional indeterminate amount of shares of Common Stock (the
"PIK Shares") that may be issued as interest accrued on the Debentures;
(iii) 500,000 shares of Common Stock (the "Warrant Shares") issuable
upon the exercise of warrants (the "Warrants") issued by the Company in the
April Offering; and
(iv) additional shares of Common Stock that may be issued as a result
of adjustments to Debentures and Warrants in amounts agreed upon by the
Company and the Selling Stockholders.
The Conversion Shares, PIK Shares and Warrant Shares are collectively
referred to in this Prospectus as the "Shares." The number of Conversion Shares
and PIK Shares offered for resale by this Prospectus will be determined by
formulae set forth in the Debentures and related Registration Rights Agreement
(filed as Exhibit 10.25). See "Selling Stockholders" for more information. This
number is subject to adjustment and could be materially more or less than the
estimate depending on a variety of factors, certain of which are outside the
control of the Company, including, without limitation, the future market price
of the Common Stock and the decision of the holders of the Debentures as to when
and in what amounts to convert their Debentures. The estimate set forth in this
Prospectus is not intended to constitute a prediction as to future market price
of the Common Stock or when and in what amounts holders will elect to convert
their Debentures. See "Risk Factors -- Effect of Conversion of the Debentures".
The actual number of shares of Common Stock issuable upon conversion of the
Debentures and exercise of the Warrants could be materially more or less than
the number of Shares registered hereunder.
We will deliver this Prospectus to purchasers upon resale of the
above-described Shares as required by applicable law or the regulations of the
United States Securities and Exchange Commission ("SEC"). This Prospectus is
neither an offer to sell these Shares nor a solicitation of an offer to buy the
Shares in any state where the offer or sale is not permitted. No underwriting
arrangements have been entered into by the Selling Stockholders. However, the
Selling Stockholders have advised us that they may offer the Shares registered
under this Prospectus to purchasers from time to time in transactions taking
place on the Nasdaq SmallCap Market, in negotiated transactions, through the
writing of options on the Shares, or a combination of such methods of sale, at
fixed prices that may be changed, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices, or at negotiated
prices. The Selling Stockholders may sell these Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders and/or the
purchasers of the Shares for whom such broker-dealers may act as agent or to
whom they may sell as principal, or both. Usual and customary or specifically
negotiated brokerage fees or commissions may be paid by the Selling Stockholders
in connection with the sales of the Shares.
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We will not receive any proceeds from the resale of these Shares by the
Selling Stockholders. See "Selling Stockholders" for additional information. We
will receive, however, certain cash consideration if the Selling Stockholders
exercise the Warrants. See "Use of Proceeds" for additional information. We have
agreed to bear all expenses (other than selling commissions) in connection with
the registration and sale of the Shares being offered by the Selling
Stockholders. We have also agreed to indemnify the Selling Stockholders against
certain liabilities, including liabilities under the Securities Act of 1933, as
amended (the "Securities Act").
The Selling Stockholders and their intermediaries through which the Shares
registered under this Prospectus are sold may be considered "underwriters"
(within the meaning of the Securities Act) with respect to the resale of such
shares, and any profits realized or commissions received may be considered
underwriting compensation. See "Plan of Distribution" for additional
information.
The Common Stock is traded on the Nasdaq SmallCap Market under the symbol
"BPLX." On May 25, 1999, the closing bid price of the Common Stock as reported
on the SmallCap Market of the National Association of Securities Dealers
Automated Quotation System ("Nasdaq") was $5.4375 per share. As of May 28, 1999
there are 13,509,081 shares of Common Stock issued and outstanding.
AN INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES A HIGH DEGREE OF
RISK AND IMMEDIATE AND SUBSTANTIAL DILUTION AND SHOULD BE CONSIDERED CAREFULLY
AND ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. SEE
"RISK FACTORS" BEGINNING ON PAGE 4 OF THIS PROSPECTUS.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is , 1999.
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BIO-PLEXUS, INC.
TABLE OF CONTENTS
SUMMARY..................................................... 1
THE COMPANY................................................. 1
RISK FACTORS................................................ 4
USE OF PROCEEDS............................................. 8
SELLING STOCKHOLDERS........................................ 8
PLAN OF DISTRIBUTION........................................ 10
LEGAL MATTERS............................................... 11
EXPERTS..................................................... 12
WHERE YOU CAN OBTAIN MORE INFORMATION....................... 12
INCORPORATION BY REFERENCE OF CERTAIN INFORMATION........... 12
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SUMMARY
You should read the following summary together with the more detailed
information contained elsewhere in this Prospectus regarding our Company, the
shares of our Common Stock being registered by this Prospectus, and the
financial statements and related notes. In particular, you should read the
section entitled "Risk Factors," which explains that your investment in shares
of our Common Stock involves a high degree of risk. This Prospectus contains
forward-looking statements concerning future events or performance of our
Company. You should not rely excessively on these forward-looking statements,
because they are only predictions based on our current expectations and
assumptions. Forward-looking statements often contain words like "intend,"
"plan," "future," "estimate," "anticipate," "believe" or "expect." Many known
and unknown risks and uncertainties could cause our actual results to differ
materially from those indicated in these forward-looking statements. You should
review carefully the risks and uncertainties identified in this Prospectus,
including those explained below and in our other SEC filings such as our Form
10-K for the fiscal year ended December 31, 1998.
You should rely only on the information contained or incorporated by
reference in this Prospectus and in any accompanying prospectus supplement. No
one has been authorized to provide you with different information. The shares of
Common Stock of our Company are not being offered in any jurisdiction where the
offer is not permitted. You should not assume that the information in this
Prospectus or any prospectus supplement is accurate as of any date other than
the date provided on the front page of the documents. We have no obligation to
update or announce revisions to any forward-looking statements to reflect actual
events or developments.
We are registering for resale the shares of our Common Stock issuable upon
conversion of the Debentures and exercise of the Warrants that we issued to
certain institutional investors. On April 21, 1999, we negotiated a private
placement of up to $4,500,000 aggregate principal amount 6% Convertible
Debentures due 2004 pursuant to a Subscription Agreement dated as of April, 1999
and executed by the Selling Stockholders, to initially purchase $2,500,000
aggregate principal amount of Debentures. The Debentures accrue interest at the
rate of 6.0% per annum, payable quarterly in arrears, and the interest is
payable either in cash or in the issuance of additional Debentures, at our
option. The Debentures are convertible at any time at the option of the holders
into shares of Common Stock, at a conversion price that is equal to the lesser
of (a) a "Fixed Conversion Price" of initially $3.06 per share and subject to
adjustments, or (b) a "Floating Conversion Price" calculated based on the
average of the five lowest closing prices during the thirty-five trading days
preceding the date of conversion. The Debentures may be wholly or partially
redeemed at our option for an amount not to exceed 130% of the face value plus
accrued and unpaid interest at any time after the date of issuance. We and the
Selling Stockholders have limited put and call options, respectively, for
additional Debentures. The financing also included the Warrant to purchase
500,000 shares of Common Stock at an exercise price of $3.38 per share subject
to certain adjustments. The imputed interest rate on the debt will be
significantly higher than the stated rate due to the value of the Warrants.
Additionally, we will incur a material charge in the second quarter for the
beneficial conversion feature of the securities.
THE COMPANY
Bio-Plexus, Inc. was incorporated under the laws of the State of
Connecticut in September 1987 for the purpose of designing, developing,
manufacturing and selling safety medical products. Our executive offices and
manufacturing facility are located at 129 Reservoir Road, Vernon, Connecticut
06066, and our telephone number is (860) 870-6112. All references herein to the
"Company" refer to Bio-Plexus, Inc. unless otherwise indicated by context.
We are engaged principally in the design, development and manufacture of
safety medical products used by healthcare professionals. Our initial products
have been safety blood collection needles and related accessory products that
are marketed under the Punctur-Guard(R) and Drop-It(R) trade names. The safety
blood collection needle utilizes a patented technology that greatly reduces the
risk of accidental needlesticks by internally blunting the needle prior to
removal from the patient. Our primary focus has been the design, development,
testing and evaluation of our safety blood collection needle, and the design and
development of
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the molds, machinery and systems used to manufacture the blood collection
needle. More recently, we have focused our efforts on developing strategic
partnerships with major healthcare companies in order to assist with the
development and expansion of our product lines.
Our Punctur-Guard(R) blood collection needle is a patented safety needle
which reduces the risk of accidental needle sticks through a self-blunting
mechanism. The Punctur-Guard(R) needle is the only safety needle on the market
which is activated prior to its removal from the patient, eliminating exposure
to a contaminated sharp. Our first Punctur-Guard(R) product was a safety blood
collection needle. The Company manufactures and sells three varieties of safety
blood collection needles, two types of needle holders and a needle disposal
container. The blood collection needle is similar in appearance, size,
performance and general operation to standard blood collection needles, and
works with substantially all standard blood collection accessories.
The blood collection needle assembly consists of a mechanically activated,
hollow, internal cannula with a blunt end, called a blunting member, placed
within a blood collection needle. The blunting member advances through the
needle by applied mechanical pressure. When the needle is inserted into the
patient, the blunting member is in its retracted position. Prior to removing the
needle from the patient, the operator applies slight additional forward force to
the blood collection tube, allowing the blunting member to advance forward and
lock into place beyond the needle's tip. The blunting member does not cause any
additional patient discomfort, and because it is hollow, fluids flow through the
needle in the same manner as through standard blood collection needles.
In addition to our blood collection needles, we manufacture needle holders
and needle disposal containers. The Drop-It(R) product line consists of the
Drop-It(R) Quick Release Needle Holder and Drop-It(R) Needle Disposal Container.
These products are designed to work in conjunction with the blood collection
needle to increase the ease-of-use for the healthcare professional. The needle
holder features simple one-handed disposal of a needle, with a push button for
quick release. The needle can also be automatically released when used with the
Drop-It(R) Needle Disposal Container.
The Drop-It(R) Needle Disposal Container is a one-quart, tray-mountable
container. The container offers fast, one handed needle disposal with push
button or automatic release when used with a Drop-It(R) Quick Release Needle
Holder. It offers temporary and permanent locking tabs, is injection molded for
uniform thickness, and meets OSHA Standards for needle disposal containers. The
Company also developed and manufactures a standard needle holder which can be
used with both Punctur-Guard(R) and standard blood collection needles.
As a company, we have received both ISO 9002 and EN 46002 certifications.
ISO 9002 is a general international standard for quality assurance in
production, installation and servicing. EN 46002 provides particular quality
system requirements for suppliers of medical devices that are more specific than
the general requirements specified in ISO 9002. We also label our products with
the CE Mark, which indicates that we are following Medical Device Directives in
Europe which include the standards set forth under ISO 9002 and EN 46002.
From the latter part of 1996 to the present, we have focused our efforts on
establishing joint venture agreements on one or more of our major product lines.
We have entered into a Development and License Agreement and a Supply Agreement
with Johnson & Johnson Medical ("JJM") of Arlington, Texas. Under the terms of
the original agreements, we would develop and manufacture safety needle
assemblies for JJM utilizing our self-blunting technology, which will be used by
JJM, under an exclusive worldwide license granted by us, to manufacture and sell
a new safety intravenous catheter ("I.V. catheter").
In recent years, we have entered into additional strategic partnerships,
namely:
- a distribution agreement with Fisher HealthCare of Houston, Texas, the
second largest operating unit of Fisher Scientific. Fisher Scientific is
one of the world leaders in serving science, providing more than 245,000
products and services to research, healthcare, industrial, educational
and government customers in 145 countries. The distribution agreement
allows Fisher HealthCare to purchase and distribute all of the Bio-Plexus
blood collection products.
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- a non-exclusive supply and distribution agreement for the United States
and Canada with Graphic Controls Corporation, a subsidiary of Tyco and a
major supplier of sharps containers in the United States. The agreement
allows Graphic Controls to purchase and distribute Bio-Plexus Drop-It(R)
Needle Disposal Containers and Drop-It(R)Quick Release Needle Holders.
- an exclusive License Agreement and Design, Development and Asset Transfer
Agreement for a safety Peripherally Inserted Central Catheter ("PICC")
introducer with TFX Medical ("TFX"), a division of Teleflex Incorporated,
the industry's dominant supplier of PICC introducers. The License
Agreement includes certain minimum annual volume requirements and ongoing
royalties on the sale of PICC introducer catheters featuring
Punctur-Guard(R) technology. Under the Design, Development and Asset
Transfer Agreement, we will design and develop safety needle assemblies
to be used with the TFX peelable catheter, and will modify existing
manufacturing equipment to be transferred to TFX pursuant to the terms
and conditions of the agreement.
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RISK FACTORS
AN INVESTMENT IN THE SHARES OF COMMON STOCK OFFERED BY THIS PROSPECTUS
INVOLVES A HIGH DEGREE OF RISK. IN ADDITION TO THE OTHER INFORMATION IN THIS
PROSPECTUS, THE FOLLOWING FACTORS SHOULD BE CONSIDERED CAREFULLY BY POTENTIAL
PURCHASERS IN EVALUATING AN INVESTMENT IN THE SHARES OF COMMON STOCK OFFERED
HEREBY. THE RISKS DESCRIBED BELOW AND ELSEWHERE IN THIS PROSPECTUS ARE NOT
INTENDED TO BE AN EXHAUSTIVE LIST OF THE GENERAL OR SPECIFIC RISKS INVOLVED, BUT
MERELY IDENTIFY CERTAIN RISKS THAT ARE NOW FORESEEN BY THE COMPANY. THESE RISK
FACTORS SHOULD BE READ IN CONJUNCTION WITH THE PUBLIC DISCLOSURE DOCUMENTS WHICH
ARE INCORPORATED IN THIS PROSPECTUS BY REFERENCE.
HISTORY OF LOSSES/UNCERTAIN PROFITABILITY
We have experienced annual operating losses and negative operating cash
flow since our incorporation in 1987. For the three months ended March 31, 1999,
we had net income of approximately $3,000. As of March 31, 1999, we had an
accumulated deficit of approximately $63 million.
POTENTIAL DELISTING FROM THE NASDAQ STOCK MARKET
Although our Common Stock is traded on the Nasdaq SmallCap Market, there is
no assurance that the Common Stock will continue to be included in such market,
or that an active market for such stock will exist. The requirements for
continued listing on the Nasdaq SmallCap Market include that the Company
maintain net assets of at least $2.0 million. As of March 31, 1999 we were in
compliance with such requirements. However, additional funding sources may be
necessary to maintain the Nasdaq minimum net asset requirements over the next
several months. The delisting of the Company's stock from the Nasdaq SmallCap
Market could cause disruption in trading of the Common Stock, and would have a
material adverse effect on our business, assets, liabilities, financial
condition, operations or prospects. There is no assurance any potential future
financing will be successful.
NEED FOR ADDITIONAL FUNDS
Future funds may be needed to be raised before we achieve profitability.
The amount of such funds will vary based upon a number of factors including --
- the level of sales of current products,
- the commercial introduction of new products,
- changes in business plan, and
- other unforeseeable events.
Such funds may not be available or may not be available on terms acceptable to
us. The lack of additional funds when needed could have a material adverse
effect on our business, assets, liabilities, financial condition, operations or
prospects. Furthermore, the issuance of additional shares of capital stock could
also be dilutive to investors in the Company.
NEED TO REDUCE MANUFACTURING COST PER NEEDLE
We continue to improve and refine our manufacturing processes. For us to be
successful, we must manufacture and sell sufficient quantities of blood
collection needles and other products under rigorous quality control standards
at a reasonable cost. Failure to produce and sell sufficient quantities of
products, at a cost per product sufficiently below our selling price, while
meeting appropriate quality control standards, could have a material adverse
effect on our business, assets, liabilities, financial condition, operations or
prospects.
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UNCERTAIN MARKET ACCEPTANCE
The use of safety medical products, including safety needles, is relatively
new. Although the market for needles is large and safety needle legislation has
passed in several states, actual sales of our products may be much less than the
market's potential. Market acceptance of our products will depend in large part
upon our ability to demonstrate the operational advantages, safety and cost
effectiveness of our blood collection needle compared to both standard and other
safety needles. The higher cost of our products may be an impediment to market
acceptance, and there can be no assurances that our products will achieve full
market acceptance.
NEED FOR GREATER MARKET PENETRATION
Sales of our products are currently significantly below the levels required
to achieve profitability. Failure to achieve a timely and significant increase
in sales may have a substantial adverse effect on our business, assets,
liabilities, financial condition, operations or prospects.
DEPENDENCE ON A SINGLE TECHNOLOGY
Our strategy is to develop a series of safety needles and related products
based upon our patented internal blunting cannula structure. This narrow focus
on a particular product line and technology makes us vulnerable to the
development of superior competing products and changes in technology which could
eliminate the need for our products. While we believe there will be no
significant change in the need for, or the desirability of, our products in the
foreseeable future, there can be no assurance that such changes will not occur.
ABILITY TO MANAGE GROWTH
We intend to pursue our current strategy of expanding production
capabilities, while reducing production costs, and devoting substantial
resources to other areas, such as the research and development of new products.
Failure to properly manage growth could have a material adverse effect on our
business, assets, liabilities, financial condition, operations or prospects.
DEPENDENCE ON KEY SUPPLIERS
We purchase our needle cannula from a single supplier located in a foreign
country. In addition, certain other components of our blood collection needles
are each manufactured by separate single major suppliers. We own or otherwise
control the molds used by such suppliers to manufacture the component parts of
our needles and could establish alternative manufacturing arrangements if
necessary. However, certain of such components have lead times of several
months, and changes in suppliers would disrupt production schedules which could
have a material adverse effect on our business, assets, liabilities, financial
condition, operations or prospects. The Company is subject to the risks of both
increased supplier prices and unfavorable exchange rate fluctuations. Recently,
we have not experienced any significant cost increases as a result of increased
supplier prices and fluctuating exchange rates.
DEPENDENCE ON CONTINUED RESEARCH AND DEVELOPMENT
The development of additional applications and products using our patented
internal blunting cannula structure may be important to the longer-term success
of the Company. There can be no assurance that any of such applications or
products will be developed or, if developed, that they will be successful. There
can be no assurance that the development of future products will be completed,
that clinical trials of such products, when and if undertaken, will be
successful, or that there will be a significant demand for such products if
development is completed.
DEPENDENCE ON PATENTS AND PROPRIETARY RIGHTS
Our future success depends in part on our ability to maintain the
proprietary nature of our technology through a combination of patents and other
intellectual property protection devices. We have been granted three patents in
the U.S. and in a number of foreign countries, and have pending applications for
our self-
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blunting safety needle in the U.S. and in a number of foreign countries. We
believe such patents will be sufficient to protect the structure and design of
our current and proposed products. However, there can be no assurance that the
protection provided by such patents will be broad enough to prevent competitors
from introducing similar devices or that such patents, if challenged, will be
upheld by the courts of any jurisdiction. Patent infringement litigation, either
to enforce our patents or defend us from patent infringement suits, would be
expensive, and if it occurs, could divert our resources from other planned uses.
Further, any adverse outcome in such litigation could have a material adverse
effect on our business, assets, liabilities, financial condition, operations or
prospects. In addition, patent applications filed in foreign countries and
patents granted in such countries are subject to laws, rules and procedures
which differ from those in the United States. Patent protection in such
countries may be different from patent protection provided by U.S. laws and may
not be as favorable to us. We also attempt to protect our proprietary
information by limiting access to our facilities and by requiring the execution
of a confidentiality agreement by any person (including contractors and Company
employees) to whom such proprietary information needs to be disclosed. There can
be no assurance that our program of patent protection, confidentiality
agreements and restricted access to our facilities will be sufficient to protect
our proprietary technology from competitors nor whether we will be able to
secure patents on any future products.
COMPETITION
The blood collection needle market is highly competitive. The leading
manufacturers of standard needles are Becton-Dickinson and Company, Sherwood
Medical Company, Inc., a subsidiary of American Home Products Corporation, and
Terumo Medical Corporation of Japan. Becton-Dickinson, as well as numerous other
smaller companies, also manufacture safety needles that use plastic sleeves or
shields as protective devices. Our safety needles compete with both standard and
safety needles. We believe that the Punctur-Guard blood collection needle is
superior in design, quality and convenience of use to all other safety needles
on the market today and can compete effectively against safety and standard
needles. However, many of our competitors have longer operating histories and
are substantially larger, better financed and better situated in the market than
us. Some of these larger competitors have the potential marketing advantage of
being able to offer multiple products to our current or prospective customers.
Such competitors may use their economic strength or market position to influence
the market. One or more of these competitors could also improve their current
products or develop new products which may compete more effectively with our
products. New competitors may arise and may develop products which compete with
our products. In addition, new technologies may arise which could lower or
eliminate the demand for our products.
PRODUCT LIABILITY
The manufacture and sale of medical devices entails an inherent risk of
liability in the event of product failure or claim of harm caused by product
operation. We are not aware of any claim against us based upon the use or the
failure of our blood collection needles. We maintain product liability insurance
against any such claims in amounts we believe to be adequate. There can be no
assurance that if we are found liable, the claim will not exceed the limits of
our insurance. There is also no assurance that we will be able to continue to
obtain product liability insurance on acceptable terms. Product liability claims
could have a material adverse effect on our business, assets, liabilities,
financial condition, operations or prospects.
DEPENDENCE ON KEY PERSONNEL
Our success depends upon the skills, experience and efforts of our
executive officers and certain marketing and technical people. We are
particularly dependent upon the services of Richard L. Higgins, our President,
and Thomas K. Sutton, our Executive Vice President. The loss of the services of
Messrs. Higgins and Sutton or any of our other key personnel could have a
material adverse effect on our business, assets, liabilities, financial
condition, operations or prospects. We have no employment agreement with either
Messrs. Higgins or Sutton.
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GOVERNMENT REGULATION
Government regulation is a significant factor in the development and
marketing of our products and in our ongoing manufacturing and research and
development activities.
Our blood collection needle is a Class II device under the regulatory
structure of the Federal Food, Drug, and Cosmetic Act (the "FDC Act") which is
administered by the United States Food and Drug Administration (the "FDA"). We
are free to market and sell the Punctur-Guard(R) blood collection needle subject
to ongoing regulatory controls by the FDA. Among other things, the FDA requires
that we adhere to certain "Good Manufacturing Practices" ("GMP") regulations
which include validation testing, quality assurance, quality control and
documentation procedures. Our facilities are also subject to periodic
inspections. In addition, performance standards may be adopted for blood
collection needles which our product would then be required to meet. Failure to
meet those standards would require us to discontinue the marketing of the
product. Furthermore, future regulations may be imposed which might have a
material adverse effect on our business, assets, liabilities, financial
condition, operations or prospects and/or one or more of our products. Finally,
since the FDA continually regulates and inspects medical devices and their
manufacture, any actual or potential product failure could result in the
imposition of administrative and/or judicial sanctions, including product
recall, which might have a material adverse effect on our business, assets,
liabilities, financial condition, operations or prospects.
In 1996, pursuant to Section 510(k) of the FDC Act (21 U.S.C. 360(k)) and
the regulations promulgated thereunder, we received approval ("510(k) approval")
from the FDA for our winged intravenous set, Drop-It(R) holder, and needle
disposal container. In 1998, Johnson & Johnson Medical, Inc. ("JJM"), one of the
Company's strategic partners (as described more fully below), received 510(k)
approval for its safety I.V. catheter using Punctur-Guard(R) blunting
technology.
The Company cannot predict the time period in which the FDA will act on new
product submittals. FDA action may take longer than we anticipate, affecting
product introductions. In addition, future regulations could impose greater
limitations and controls on our products. There is no assurance that FDA
approval for a particular product will be granted.
Distribution of our products in countries other than the United States may
be subject to foreign regulation. There can be no assurance that we will be able
to obtain the approvals necessary to market our products outside of the United
States.
POTENTIAL VOLATILITY OF STOCK PRICE
The stock market has from time to time experienced significant price and
volume fluctuations that are unrelated to the operating performance of
particular companies. The market price of the publicly traded Common Stock,
similar to that of the common stock of other bio-technology companies, may be
highly volatile. Factors which may have a significant effect on the market price
of our Common Stock and may cause it to fluctuate dramatically include --
- fluctuations in the Company's operating results,
- changes in actual earnings or in earnings estimates by analysts,
- government regulation,
- general conditions in the medical products and/or healthcare markets,
- recessionary cycles,
- changing interest rates,
- our announcements of technological developments,
- our competitors' announcements of technological developments, and
- other events largely outside our control.
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DIVIDENDS
The Company has not paid dividends since its inception and does not intend
to pay any dividends on the Common Stock for the foreseeable future.
ANTI-TAKEOVER PROVISIONS
The Connecticut Business Corporation Act contains certain provisions that
may have the effect of discouraging unsolicited takeover bids from third
parties.
STRATEGIC PARTNERS
Our future may depend on our ability to secure strategic partners for the
development, manufacture and marketing of our products. In January 1997, we
entered into a long-term partnership with JJM for the development of a new
safety I.V. catheter using Punctur-Guard(R) technology. Pursuant to that
agreement, JJM has been granted the worldwide license to market and sell the
catheter developed under that agreement. In April 1998, the agreement was
amended to, among other things, transfer manufacturing of the safety needle
assemblies to JJM.
In October 1998, we entered into an agreement with TFX Medical, a division
of Teleflex Incorporated, for the development and production of a PICC
Introducer Catheter featuring Punctur-Guard(R) technology. Pursuant to that
agreement, the Company will design and develop safety needle assemblies to be
used with the TFX Peelable Catheter, and will modify existing manufacturing
equipment to be transferred to TFX pursuant to the terms and conditions of the
agreement.
We are currently negotiating with several other potential strategic
partners. However, we are not certain that we will be able to secure additional
strategic partnerships for our products on terms favorable to us.
EFFECT OF CONVERSION OF THE DEBENTURES
Depending upon the date on which the Debentures are converted, the number
of Conversion Shares and PIK Shares issuable under the Debentures to the Selling
Stockholders could represent a significant percentage of the outstanding shares
of Common Stock. Sale of the Conversion Shares and PIK Shares issuable under the
Debentures or the sale of shares of Common Stock after this offering in the
public market could materially adversely affect the market price of the Common
Stock.
USE OF PROCEEDS
We will receive certain cash consideration if any of the Selling
Stockholders exercises its respective Warrant. We intend to use any cash
proceeds that we receive from exercise of the warrants for working capital
purposes. Otherwise, we will not receive any proceeds from the resale of any of
the Shares registered under this Prospectus. We will pay all of the costs of the
registration of the Shares of Common Stock registered under this Prospectus
(other than selling commissions). See "Selling Stockholders" for additional
information.
SELLING STOCKHOLDERS
The following table sets forth information with respect to the Selling
Stockholders, the shares of Common Stock beneficially owned by the Selling
Stockholders, and the Shares of Common Stock issuable upon conversion of the
Debentures and exercise of the Warrants, which Shares we have agreed to register
for resale by the Selling Stockholders. Except as otherwise disclosed in this
Prospectus, the Selling Stockholders neither have nor within the past three
years had any position, office or other material relationship with our Company
or any of our affiliates. Because the Selling Stockholders may offer all or a
portion of the Shares of
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Common Stock registered hereby pursuant to this Prospectus, we cannot estimate
the number of Shares that will be held by the selling shareholders after such
sales.
NUMBER OF
SHARES OWNED PERCENTAGE NUMBER OF
BEFORE OF SHARES OFFERED
NAME OF SELLING STOCKHOLDER OFFERING(1)(2) CLASS(3) HEREBY(4)
- --------------------------- -------------- ---------- --------------
Leonardo, L.P. ....................................... 368,758 2.7% 980,000
c/o Angelo Gordon & Co., L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attn: Gary Wolf
AG Super Fund International Partners, L.P. ........... 52,680 * 140,000
c/o Angelo Gordon & Co., L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attn: Gary Wolf
Ramius Fund, Ltd. .................................... 131,699 1% 350,000
c/o Angelo Gordon & Co., L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attn: Gary Wolf
GAM Arbitrage Investments, Inc. ...................... 52,680 * 140,000
c/o Angelo Gordon & Co., L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attn: Gary Wolf
Raphael, L.P. ........................................ 52,680 * 140,000
c/o Angelo Gordon & Co., L.P.
245 Park Avenue, 26th Floor
New York, NY 10167
Attn: Gary Wolf
AGR Halifax Fund, Ltd. ............................... 658,497 4.6% 1,750,000
c/o Ramius Capital Group, LLC
757 Third Avenue, 27th Floor
New York, NY 10017
Attn: Jeffrey M. Solomon
- ---------------
* Indicates less than 1 percent.
(1) Beneficial ownership is determined in accordance with SEC rules and
generally includes voting or investment power with respect to securities.
Shares of our Common Stock that are issuable upon exercise of the Debentures
and Warrants, to the extent that such securities are currently exercisable
within 60 days of May 28, 1999, are treated as outstanding for computing
each Selling Shareholder's percentage ownership of shares of our Common
Stock.
(2) Assumes that all of the shares of Common Stock registered under this
Prospectus are resold pursuant to this Prospectus and that the Selling
Stockholders will not hold any other shares of Common Stock.
(3) Beneficial ownership is determined as of May 27, 1999 and with regard to the
holders of the Debentures, is based on a conversion price equal to $3.06
(which is the conversion price in effect on such date). Assumes conversion
of all of the Debentures and exercise of all the Warrants.
(4) Represents 200% of the number of shares of Common Stock that would have been
issuable upon conversion of the Debentures and 200% of the number of shares
of Common Stock issuable to the Selling Stockholders upon exercise of their
Warrants to purchase common shares as of April 21, 1999, the closing date of
the April Offering. The actual number of Shares registered and offered under
this Prospectus were determined by agreement between the Company and the
Selling Stockholders. The number of
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Conversion Shares and PIK Shares cannot be determined at this time because that
number depends on (a) closing bid prices of the Common Stock prior to conversion
and (b) certain antidilution adjustments.
(5) Under the Registration Rights Agreement (included as Exhibit 10.25 to the
Registration Statement -- See "Exhibits" and "Where You Can Obtain More
Information" for more information), we agreed to register certain shares of
Common Stock for resale by the Selling Stockholders to permit the resale
from time to time in the market or in privately-negotiated transactions. We
will prepare and file such amendments and supplements to the Registration
Statement and accompanying Prospectus as may be necessary in accordance with
the rules and regulations of the Securities Act of 1933, to keep it
effective until the earlier of three years from the effective date or the
date on which the Shares covered by the Registration Statement have been
sold or may be sold without restriction pursuant to Rule 144 of the
Securities Act.
(6) There are several limitations on the number of Conversion Shares that we are
required to issue:
(i) The Company is not required to issue upon conversion of the
Debentures, in the aggregate, more than a number of shares of Common Stock
equal to 19.99% of the number of shares of Common Stock outstanding on the
date of issuance.
(ii) No holder of Debentures covered by this Prospectus may convert
such Debentures if the conversion would cause that holder to beneficially
own more than 5% of the Company's Common Stock (other than shares deemed to
be beneficially owned through the conversion right in the Debentures owned
by such Selling Stockholder, except upon 61 days prior notice to the
Company).
(iii) For the first 30,000 shares of the Company's Common Stock traded
on Nasdaq on any conversion date, the holders of the Debentures may only
convert the Debentures into shares of Common Stock equal to 25% of the
Company's trading volume on Nasdaq.
(7) Angelo, Gordon & Co., L.P. is the trading manager of Leonardo, L.P., GAM
Arbitrage Investments, Inc., AG Super Fund International Partners, L.P.,
Raphael, L.P. and Ramius, L.P. (the "Angelo Gordon Entities") and
consequently has voting control and investment discretion over securities
held by the Angelo Gordon Entities.
PLAN OF DISTRIBUTION
The Selling Stockholders have advised us that they may offer the shares of
Common Stock registered under this Prospectus to purchasers from time to time:
- in transactions in the Nasdaq SmallCap Market System, 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 the resale;
- at prices related to such market prices; or
- at negotiated prices.
At the date of this Prospectus, the Selling Stockholders have not entered
into any underwriting arrangements. The Selling Stockholders may sell the shares
registered under this Prospectus to or through:
- ordinary brokers' transactions;
- transactions involving cross or block trades or otherwise on the Nasdaq
SmallCap Market;
- purchases by brokers, dealers or underwriters as principal and resale by
such purchasers for their own accounts pursuant to this Prospectus;
- "at the market" to or through market makers or into an existing market
for our Common Stock;
- in other ways not involving market makers or established trading markets,
including direct sales to purchasers or sales effected through agents;
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- through transactions in options, swaps or other derivatives (whether
exchange-listed or otherwise);
- in privately negotiated transactions;
- to cover short sales; or
- any combination of the foregoing.
From time to time, one or more of the Selling Stockholders may pledge,
hypothecate or grant a security interest in some or all of the Shares of Common
Stock registered under this Prospectus owned by them, and the pledgees, secured
parties or persons to whom such Shares have been hypothecated shall, upon
foreclosure in the event of default, be deemed to be Selling Stockholders under
this Prospectus. The number of Shares of Common Stock registered under this
Prospectus and beneficially owned by those Selling Stockholders who so transfer,
pledge, donate or assign those shares will decrease as and when they take such
actions. The plan of distribution for Shares sold under this Prospectus will
otherwise remain unchanged, except that the transferees, pledgees, donees or
other successors will be Selling Stockholders under this Prospectus. In
addition, a Selling Stockholder may, from time to time, sell short shares of
Common Stock. In such instances, this Prospectus may be delivered in connection
with such short sales and the Shares of Common Stock offered hereby may be used
to cover such short sales.
A Selling Stockholder may enter into hedging transactions with
broker-dealers and the broker-dealers may engage in short sales of the Common
Stock in the course of hedging the positions they assume with that Selling
Stockholder, including, without limitation, in connection with distributions of
the Common Stock by the broker-dealers. A Selling Stockholder also may enter
into option or other transactions with broker-dealers that involve the delivery
of the Shares of Common Stock registered under this Prospectus to the broker-
dealers, who then may resell or otherwise transfer these Shares. A Selling
Stockholder also may loan or pledge the Shares of Common Stock registered under
this Prospectus to a broker-dealer and the broker-dealer may sell the Shares so
loaned or upon a default may sell or otherwise transfer the pledged Shares.
Broker, dealers, underwriters or agents participating in the distribution
of the Shares of Common Stock registered under this Prospectus as agents may
receive compensation in the form of commissions, discounts or concessions from
the Selling Stockholders and/or purchasers of the Common Stock for whom the
broker-dealers may act as agent, or to whom they may sell as principal, or both
(which compensation as to a particular broker-dealer may be less than or in
excess of customary commissions). The Selling Stockholders and any
broker-dealers who act in connection with the sale of the Shares of Common Stock
under this Prospectus may be deemed to be"underwriters" within the meaning of
the Securities Act of 1933, and any commissions they receive and proceeds of any
sale of the Shares of Common Stock may be deemed to be underwriting discounts
and commissions under the Securities Act of 1933. Neither we nor any of the
Selling Stockholders can presently estimate the amount of this compensation. We
know of no existing arrangements between any of the Selling Stockholders, any
other shareholder, broker, dealer, underwriter or agent relating to the sale or
distribution of the Shares registered under this Prospectus.
We will pay substantially all of the expenses relating to the registration,
offer and sale of the Shares of Common Stock registered under this Prospectus to
the public other than commissions or discounts of underwriters, broker-dealers
or agents. We also have agreed to indemnify the Selling Stockholders and certain
related persons against any losses, claims, damages or liabilities under the
Securities Act of 1933 or otherwise that arise out of, or are based upon, any
untrue or alleged untrue statement of a material fact or the omission or alleged
omission in stating a material fact under this Registration Statement or
Prospectus. To the extent that indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to our directors, officers and
controlling persons, we have been advised that, in the opinion of the SEC, this
indemnification is against public policy as expressed in the Securities Act of
1933 and is therefore, unenforceable.
LEGAL MATTERS
The validity of the securities offered hereby have been passed upon for our
Company by Pepe & Hazard LLP, Hartford, Connecticut.
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EXPERTS
The audited financial statements included in this Prospectus have been
audited by various independent accountants. The firms and periods covered by
these audits are indicated in the individual accountants' reports. Such
financial statements have been so included in reliance on the reports of the
various independent accountants given on the authority of such firms as experts
in auditing and accounting.
WHERE YOU CAN OBTAIN MORE INFORMATION
We are required to follow the reporting requirements of the Securities
Exchange Act of 1934. To comply with these requirements, we file a number of
reports, including annual and quarterly reports, proxy statements, information
statements and other information with the SEC. You may inspect and copy any of
this information that we have filed with the SEC at the public reference
facilities maintained by the SEC at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the SEC's regional offices located at 7 World
Trade Center, Suite 1300, New York, New York 10048 and Citicorp Center, 500 W.
Madison Street, Suite 1400, Chicago, IL 60661-2511. You may obtain information
on the operation of the public reference room by calling the Commission at
1-800-SEC-0330. You also may obtain copies of such material at prescribed rates
from the Public Reference Section of the SEC at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549. You also may inspect such reports, proxy
statements, information statements and other information concerning us at the
offices of The Nasdaq Stock Market, Inc. at 1735 K Street, N.W., Washington,
D.C. 20006. You also may access the materials that we file electronically with
the SEC at the SEC's website (http://www.sec.gov), which contains the reports,
proxy statements, information statements and other information that we file
electronically with the SEC.
We have filed with the SEC a Registration Statement on Form S-3 under the
Securities Act of 1933, with respect to the shares covered by this Prospectus.
This Prospectus does not contain all of the information set forth in the
Registration Statement, because certain parts are omitted in accordance with the
rules and regulations of the SEC. Statements made in this Prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete and, with respect to each such contract, agreement or other
document filed as an exhibit to the Registration Statement, we refer you to such
exhibit for a more complete description of the matter involved. Each such
statement is deemed qualified in its entirety by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
We incorporate by reference in this Prospectus and encourage you to read
the following documents that we have filed with the SEC (File No. 0-24128)
pursuant to the requirements of the Securities Exchange Act of 1934:
(1) Our Registration Statement on Form 8-A filed with the Commission
on March 13, 1997 registering the Common Stock of the Company under Section
12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act");
(2) Our Annual Report on Form 10-K for the year ended December 31,
1998;
(3) Our Quarterly Report on Form 10-Q for the quarter ended March 31,
1999;
(4) Our Current Report on Form 8-K dated April 30, 1999;
(5) The description of our Common Stock contained in our Registration
Statement on Form 8-A filed with the SEC on May 13, 1994, including any
amendments or reports filed for the purpose of updating the description;
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(6) All documents that we subsequently filed with the SEC pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934,
prior to termination of the offering of shares of our Common Stock for
resale as described in this Prospectus. We also incorporate by reference as
part of this Prospectus and encourage you to read all reports and other
documents that we have filed (or will file) with the SEC under the
Securities Exchange Act of 1934, that are after the date of this Prospectus
and before the termination of the offering of the shares registered under
this Prospectus.
You should understand that, if any statement contained in a report or
document that is incorporated by reference in this Prospectus is supplemented,
modified or superseded, then the later filed report or document will supplement,
modify or supersede the statements contained in this Prospectus.
We will provide without charge to each person, including any beneficial
owner, to whom a copy of this Prospectus is delivered, upon the written or oral
request of that person, a copy of any and all documents incorporated by
reference in this Prospectus (not including, however, the exhibits to those
documents unless those exhibits are specifically incorporated by reference in
such documents). Requests should be sent to the attention of the Secretary of
our Company, at 129 Reservoir Road, Vernon, Connecticut 06066 or you may call
and ask for the Secretary of our Company at (860) 870-6112.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated cumulative expenses of this registration of Shares of Common
Stock for resale by the Selling Stockholders, all of which are to be paid by the
registrant in connection with the issuance and distribution of the Shares being
registered, are estimated as follows:
AMOUNT
-------
Registration Fee -- SEC..................................... $ 5,595(1)
Nasdaq SmallCap Market Listing Fee.......................... 7,500
Accounting Fees and Expenses................................ 10,000*
Legal Fees and Expenses (including Blue Sky)................ 20,000*
Printing and engraving expenses............................. 5,000*
Miscellaneous............................................... 2,000*
Total....................................................... $50,095
- ---------------
* Estimated
(1) Registration fee paid upon the initial filing of this Registration
Statement.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
We maintain directors' and officers' liability insurance with policy limits
as are reasonable and customary for our industry. The policy covers losses
arising from, among other things, claims of breach of duty, neglect, error,
alleged misstatement, misleading statement or omission by the directors and
officers in their capacity as such. Payment for loss would be made to or on our
behalf where we are required or permitted to indemnify directors or officers for
covered losses pursuant to statutory of common law, our Certificate of
Incorporation, as amended, or Bylaws, as amended, or by agreement. The policy
provides for retentions at various limits.
We hereby incorporate by reference Sections 33-771, 33-772, 33-774 and
33-776 of the Connecticut Business Corporation Act as follows:
CONNECTICUT BUSINESS CORPORATION ACT SECTION 33-771 PROVIDES IN PART:
(a) Except as provided in subsection (d) of this section, a
corporation may indemnify an individual made a party to a proceeding
because he is or was a director against liability incurred in the
proceeding if: (1) He conducted himself in good faith; and (2) he
reasonably believed (A) in the case of conduct in his official capacity
with the corporation, that his conduct was in its best interests, and (B)
in all other cases, that his conduct was at least not opposed to its best
interests; and (3) in the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit plan for
a purpose he reasonably believed to be in the interests of the participants
in and beneficiaries of the plan is conduct that satisfies the requirement
of subparagraph (B) of subdivision (2) of subsection (a) of this section.
(c) The termination of a proceeding by judgment, order, settlement or
conviction or upon a plea of nolo contendere or its equivalent is not, of
itself, determinative that the director did not meet the standard of
conduct described in this section.
(d) A corporation may not indemnify a director under this section: (1)
In connection with a proceeding by or in the right of the corporation in
which the director was adjudged liable to the corporation; or (2) in
connection with any other proceeding charging improper personal benefit to
him,
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whether or not involving action in his official capacity, in which he was
adjudged liable on the basis that personal benefit was improperly received
by him.
(e) Indemnification permitted under this section in connection with a
proceeding by or in the right of the corporation is limited to reasonable
expenses incurred in connection with the proceeding.
CONNECTICUT BUSINESS CORPORATION ACT SECTION 33-772 PROVIDES:
Unless limited by its certificate of incorporation, a corporation shall
indemnify a director who was wholly successful, on the merits or otherwise, in
the defense of any proceeding to which he was a party because he is or was a
director of the corporation against reasonable expenses incurred by him in
connection with the proceeding.
CONNECTICUT BUSINESS CORPORATION ACT SECTION 33-774 PROVIDES:
Unless a corporation's certificate of incorporation provides otherwise, a
director of the corporation who is a party to a proceeding may apply for
indemnification to the court conducting the proceeding or to another court of
competent jurisdiction. On receipt of an application, the court after giving any
notice the court considers necessary may order indemnification if it determines:
(1) The director is entitled to mandatory indemnification under section 33-772,
in which case the court shall also order the corporation to pay the director's
reasonable expenses incurred to obtain court-ordered indemnification; or (2) the
director is fairly and reasonable entitled to indemnification in view of all the
relevant circumstances, whether or not he met the standard of conduct set forth
in section 33-771 or was adjudged liable as described in subsection (d) of said
section, but if he was adjudged so liable his indemnification is limited to
reasonable expenses incurred.
CONNECTICUT BUSINESS CORPORATION ACT SECTION 33-776 PROVIDES IN PART:
Unless a corporation's certificate of incorporation provides otherwise:
(1) An officer of the corporation who is not a director is entitled to
mandatory indemnification under section 33-772, and is entitled to apply
for court-ordered indemnification under section 33-774, in each case to the
same extent as a director.
(3) Notwithstanding subdivision (4) of this section, a corporation may
also indemnify and advance expenses to an officer, employee or agent who is
not a director to the extent, consistent with public policy, that may be
provided by contract, its certificate of incorporation, bylaws, or general
or specific action of its board of directors, each of which may delegate to
its general counsel or other specified officer or officers the ability to
authorize such indemnification and the responsibility to determine whether
any conditions to such indemnification or advance of expenses have been
established.
ARTICLE IX OF THE REGISTRANT'S BYLAWS PROVIDES:
The Corporation shall indemnify shareholders, directors, officers,
employees and agents of the Corporation to the maximum extent permitted
by the Stock Corporation Act of the State of Connecticut. Expenses of a
party which may be indemnifiable under the Stock Corporation Act
incurred in defending a proceeding shall be paid by the Corporation in
advance of the final disposition of such proceeding as authorized by the
Board of Directors upon agreement of the eligible party to repay such
amount if he is later found not entitled to be indemnified by the
Corporation under the Stock Corporation Act.
Effective January 1, 1997, the Stock Corporation Act of the State of
Connecticut was been repealed, superseded by the Business Corporation Act of the
State of Connecticut.
In addition, the Registrant maintains directors' and officers' liability
insurance policies.
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ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
See Exhibit Index included immediately preceding the Exhibits to this
Registration Statement, which is incorporated herein by reference.
ITEM 17. UNDERTAKINGS. The Company 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, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this 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 this
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
provided, however, that paragraphs (1)(i) and (1) (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") that are incorporated by reference in this
Registration Statement.
(2) That, for the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at the 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. The Company hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Company's annual report
pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable,
each filing of any employer benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Company
pursuant to the indemnification provisions described herein, or otherwise, the
Company 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 Company
of expenses incurred or paid by a director, officer or controlling person of the
Company in the successful defense of any action, suit or proceedings) is
asserted by such director, officer or controlling person in connection with the
securities being registered, the Company will, unless in the 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.
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22
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing this Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Vernon, Connecticut on the 28th day of May 1999.
BIO-PLEXUS, INC.
By: /s/ RICHARD L. HIGGINS
------------------------------------
Richard L Higgins
President and
Chief Executive Officer
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
dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/ RICHARD L. HIGGINS President, Chief Executive Officer and May 28, 1999
- ------------------------------------------------ Director (Principal Executive
Richard L. Higgins Officer)
/s/ KIMBERLEY A. CADY Vice President and Chief Financial May 28, 1999
- ------------------------------------------------ Officer (Principal Financial Officer
Kimberley A. Cady and Principal Accounting Officer)
/s/ DAVID HIMICK Director May 28, 1999
- ------------------------------------------------
David Himick
/s/ HERMAN GROSS Director May 28, 1999
- ------------------------------------------------
Herman Gross
/s/ RICHARD RIBAKOVE Director May 28, 1999
- ------------------------------------------------
Richard Ribakove
II-4
23
EXHIBIT INDEX
NO. DESCRIPTION
--- -----------
1.1 Form of Underwriting Agreement between Advest, Inc. and the
Company(1)
1.2 Form of Advest, Inc. Warrant(1)
1.3 Form of Advest, Inc. Registration Rights Agreement(1)
1.4 Form of Underwriting Agreement among Advest, Inc. as
representative of the several underwriters named therein and
the Company(2)
3.1 Certificate of Incorporation of the Company, as amended(3)
3.2 Bylaws of the Company, as amended(4)
4.1 Loan Agreement, dated January 7, 1992, between the Company
and CII(1)
4.2 Loan Agreement dated July 27, 1993, between the Company and
the CDA(1)
4.3 Form of Unsecured Term Notes with Detachable Warrants to
Purchase Common Stock(5)
4.4 Loan Agreement, dated March 7, 1995, between the Company and
the CDA(6)
4.4a Letter agreement dated March 31, 1997 between the Company
and CDA(7)
4.5 Promissory Note, dated October 28, 1994, between the Company
and Victor and Margaret DeMattia(6)
4.6 Offshore Convertible Securities Subscription Agreement dated
January 30, 1997 between the Company and Shepherd
Investments International Ltd., as amended by Letter
agreement dated March 25, 1997, and as further amended by
Letter agreement dated April 16, 1997(7)
4.6a Letter agreement between the Company and Ronald A. Haverl
and Carl R. Sahi regarding voting of Class A Common Stock(8)
5.1 Opinion of Pepe & Hazard LLP, Hartford, Connecticut(12)
10.1 Lease, dated March 7, 1989, between the Company and T&S
Limited Partnership, as amended(1)
10.2 Royalty Agreement, dated November 6, 1989, between the
Company and CII, as amended(1)
10.3 Master Lease Agreement, dated April 30, 1993, between the
Company and Aberlyn Capital Management and its Affiliate,
Aberlyn(1)
10.4 Purchase and Sale Agreement, as amended, for 129 Reservoir
Road, Vernon, Connecticut, dated October 28, 1994, between
the Company and Victor and Margaret DeMattia(6)
10.5 Lease, dated March 11, 1994, between the Company and Thomas
D. Buccino d/b/a The Mill Works(1)
10.6 Marketing and Distribution Agreement dated March 16, 1995,
between the Company and Allegiance(9)
10.7 1991 Long-Term Incentive Plan(9)
10.8 Stock Warrant granted by the Company to Ronald A. Haverl(9)
10.9 Stock Warrant granted by the Company to Carl R. Sahi(9)
10.10 Stock Warrant granted by the Company to Ronald A. Haverl(9)
10.11 Stock Warrant granted by the Company to Carl R. Sahi(9)
10.12 Master Equipment Lease Agreement dated as of March 8, 1995,
between the Company and Financing for Science International,
Inc.(10)
10.13 1995 Non-Employee Directors' Stock Option Plan(10)
10.14 Note and Warrant Purchase Agreement, Form of Private
Placement Note, Security Agreement, and Form of Warrant(10)
10.15 Letter Agreement with Aberlyn Capital Management Limited
Partnership(10)
10.16 Employment Agreement dated January 13, 1997 between the
Company and Lucio Improta(7)
II-5
24
NO. DESCRIPTION
--- -----------
10.17 Term Sheet dated August 1, 1997 describing arrangement
between the Company and Ronald Haverl(11)
10.18 Development and License Agreement dated January 28, 1997 by
and between the Company and Johnson & Johnson Medical,
Inc.(3)
10.19 Supply Agreement dated January 28, 1997 by and between the
Company and Johnson & Johnson Medical, Inc.(3)
10.20 Term Promissory Note issued to Carl R. Sahi(3)
10.21 Warrant for shares of common stock issued to Carl R. Sahi(3)
10.22 Subscription Agreement by and among the Company and the
Selling Stockholders(12)
10.23 Form of Debenture granted by the Company to the Selling
Stockholders(12)
10.24 Form of Warrant granted by the Company to the Selling
Stockholders(12)
10.25 Registration Rights Agreement by and among the Company and
the Selling Stockholders(12)
23.1 Consent of Mahoney Sabol & Company, LLP(12)
23.2 Consent of PricewaterhouseCoopers LLP(12)
23.3 Consent of Pepe & Hazard LLP (included in Exhibit 5.1)(12)
- ---------------
(1) Incorporated by reference to the similarly described exhibits filed in
connection with the Registrant's registration statement on Form S-1 filed
on April 1, 1994 (File No. 33-77202).
(2) Incorporated by reference to the similarly described exhibit filed in
connection with Registrant's Amendment No. 2 to the registration statement
on Form S-1 filed on September 15, 1995 (File No. 33-95554).
(3) Incorporated by reference to the similarly described exhibits included with
Registrant's Quarterly Report on Form 10-Q for the quarter ended September
30, 1998 (File No. 0-24128).
(4) Incorporated by reference to the similarly described exhibit included with
the Registrant's Annual Report on Form 10-K filed on April 13, 1998 (File
No. 0-24128).
(5) Incorporated by reference to the similarly described exhibit filed in
connection with the Registrant's registration statement on Form S-1 filed
on April 1, 1994 (File No. 33-77202).
(6) Incorporated by reference to the similarly described exhibits included with
the Registrant's Annual Report on Form 10-K filed on March 30, 1995 (File
No. 0-24128).
(7) Incorporated by reference to the similarly described exhibits included with
the Registrant's Quarterly Report on Form 10-Q for the quarter ended on
March 31, 1997 (File No. 0-24128).
(8) Incorporated by reference to the similarly described exhibit included with
the Registrant's Quarterly Report on Form 10-Q for the quarter ended on
June 30, 1997 (File No. 0-24128).
(9) Incorporated by reference to the similarly described exhibits included with
the Registrant's Amendment No. 2 to Annual Report on Form 10-K filed on
June 30, 1995 (File No. 0-24128).
(10) Incorporated by reference to the similarly described exhibits included with
the Registrant's Quarterly Report on Form 10-Q for the quarter ended on
June 30, 1995 (File No. 0-24128).
(11) Incorporated by reference to the similarly described exhibit included with
the Registrant's Annual Report on Form 10-K/A filed on April 30, 1998 (File
No. 0-24128).
(12) Filed with this Registration Statement.
II-6