SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
Amendment No. 1
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1996 Commission File Number: 0-24866
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ISOLYSER COMPANY, INC.
(Exact Name of registrant as specified in its charter)
GEORGIA 58-1746149
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
650 ENGINEERING DRIVE
TECHNOLOGY PARK
NORCROSS, GEORGIA 30092
(Address of principal executive offices) (Zip Code)
(770) 582-6363
Registrant's telephone number, including area code
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
common stock, $.001 par value per share
stock purchase rights
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of common stock held by nonaffiliates of the
registrant based on the sale trade price of the common stock as reported on The
Nasdaq Stock Market on March 27, 1997, was approximately $165.4 million. For
purposes of this computation, all officers, directors and 5% beneficial owners
of the registrant are deemed to be affiliates. Such determination should not be
deemed an admission that such officers, directors or 5% beneficial owners are,
in fact, affiliates of the registrant.
At March 27, 1997, there were outstanding 39,207,668 shares of the registrant's
common stock, $.001 par value per share.
Documents incorporated by reference: Portions of the Company's definitive proxy
statement for the annual meeting of shareholders are incorporated by reference
into Part III. Certain exhibits provided in Part IV are incorporated by
reference from the Company's Registration Statements on Form S-1 (File Nos.
33-83474 and 33-97086), Registration Statement on Form S-4 (File No. 333-7977),
Registration Statement on Form S-8 (File Nos. 33-85668), annual report on Form
10-K for the periods ended December 31, 1994, and December 31, 1995, and current
reports on Form 8-K dated May 31, 1995, September 18, 1995, June 4, 1996, August
30, 1996 and December 19, 1996.
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Note: The discussions in the Form 10-K and this Amendment contain
forward looking statements that involve risks and uncertainties. The actual
results of Isolyser Company, Inc. and subsidiaries (the "Company") could differ
significantly from those set forth herein. Factors that could cause or
contribute to such differences include, but are not limited to, those discussed
in "Business", particularly "Business -- Risk Factors", and "Management's
Discussion and Analysis of Financial Condition and Results of Operations" as
well as those discussed elsewhere in the Form 10-K. Statements contained in the
Form 10-K and this Amendment that are not historical facts are forward looking
statements that are subject to the safe harbor created by the Private Securities
Litigation Reform Act of 1995. A number of important factors could cause the
Company's actual results for 1997 and beyond to differ materially from those
expressed or implied in any forward looking statements made by, or on behalf of,
the Company. These factors include, without limitation, those listed in
"Business -- Risk Factors" in the Form 10-K.
Subsequent to filing the Annual Report on Form 10-K for the period
ending December 31, 1996 ("Form 10-K") of Isolyser Company, Inc. (the "Company")
and during 1996, the Company changed certain of its directors and executive
officers. Accordingly, effective May 1, 1997 the undersigned registrant hereby
amends Part III of its Annual Report on Form 10-K as set forth below:
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PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information contained in the Company's definitive proxy statement
dated May 1, 1997 (the "Proxy Statement") under the caption "Directors and
Executive Officers" is incorporated herein by reference in response to this
item.
ITEM 11. EXECUTIVE COMPENSATION
The information contained in the Proxy Statement under the caption
"Executive Compensation" is incorporated herein by reference in response to this
item, exclusive of the information contained in the Proxy Statement under the
captions "Report of the Compensation Committee on Executive Compensation" and
"Stock Price Performance Graph".
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The information in the Proxy Statement contained under the caption
"Security Ownership of Certain Beneficial Owners and Management" is incorporated
herein by reference in response to this item.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has no information to report pursuant to this Item.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) (1) and (2) - Financial Statements and Schedules
The following financial statements and schedules included on pages
F-1 through F-23 are filed as part of this annual report.
Consolidated Financial Statements and Independent Auditors' Report:
Independent Auditors' Report
Consolidated Balance Sheets as of December 31, 1996 and 1995
Consolidated Statements of Operations for the years
ended December 31, 1996, 1995 and 1994 Consolidated
Statements of Changes in Shareholders' Equity for
the years ended December 31, 1996, 1995 and 1994
Consolidated Statements of Cash Flows for the years
ended December 31, 1996, 1995 and 1994 Notes to the
Consolidated Financial Statements
Financial Statement Schedules:
Schedule II - Valuation and Qualifying Accounts
Other schedules are omitted because they are not applicable,
not required or because required information is included in the
consolidated financial statements or notes thereto.
(3) Exhibits
2.1 Articles of Merger of MedSurg Industries, Inc. and MedSurg Acquisition Corp. dated December 31, 1993
(incorporated by reference to Exhibit 2.1 filed with the Company's Registration Statement on Form S-1, File No. 33-
83474)
2.2 Plan and Agreement of Merger dated December 31, 1993 of MedSurg Industries, Inc. and MedSurg Acquisition Corp.
(incorporated by reference to Exhibit 2.2 filed with the Company's Registration Statement on Form S-1, File No. 33-
83474)
2.3 Certificate of Merger and Name Change of MedSurg Industries, Inc. and MedSurg Acquisition Corp. dated January
7, 1994 (incorporated by reference to Exhibit 2.3 filed with the Company's Registration Statement on Form S-1, File
No. 33-84374)
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2.4 Articles of Merger of Creative Research and Manufacturing, Inc. and Creative Acquisition Corp. dated December 31,
1993 (incorporated by reference to Exhibit 2.4 filed with the Company's Registration Statement on Form S-1, File
No. 33-83474)
2.5 Plan and Agreement of Merger dated December 31, 1993 of Creative Research and Manufacturing, Inc. and Creative
Acquisition Corp. (incorporated by reference to Exhibit 2.5 filed with the Company's Registration Statement on Form
S-1, File No. 33-83474)
2.6 Certificate of Merger and Name Change of Creative Research and Manufacturing, Inc. and Creative Acquisition Corp.
dated January 7, 1994 (incorporated by reference to Exhibit 2.6 filed with the Company's Registration Statement on
Form S-1, File No. 33-83474)
2.7 Agreement and Plan of Merger dated as of July 28, 1995 among the Company, White Knight Acquisition Corp. and
White Knight Healthcare, Inc. (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form
8-K filed October 3, 1995)
2.8 Agreement and Plan of Merger dated as of May 1, 1995 among the Company, Isolyser/SafeWaste Acquisition Corp.
and SafeWaste Corporation (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K
filed on June 15, 1995)
2.9 Articles of Merger dated May 31, 1995 of SafeWaste Corporation With and Into Isolyser/SafeWaste Acquisition Corp.
(incorporated by reference to Exhibit 2.2 to the Company's Current Report on Form 8-K filed on June 15, 1995)
2.10 Certificate of Merger dated May 31, 1995 of Isolyser/SafeWaste Acquisition Corp. and SafeWaste Corporation
(incorporated by reference to Exhibit 2.3 to the Company's Current Report on Form 8-K filed on June 15, 1995)
2.11 Articles of Merger of White Knight Healthcare, Inc., and White Knight Acquisition Corp., dated September 18, 1995
(incorporated by reference to Exhibit 2.2 to the Company's Current Report on Form 8-K filed on October 3, 1995)
2.12 Certificate of Merger of White Knight Healthcare, Inc., and White Knight Acquisition Corp., dated September 18, 1995
(incorporated by reference to Exhibit 2.3 to the Company's Current Report on Form 8-K filed October 3, 1995)
2.13 Stock Purchase Agreement dated December 31, 1993 between the Company, MedSurg Acquisition Corp., Creative
Acquisition Corp., MedSurg Industries, Inc., Creative Research and Manufacturing, Inc. and MedInvest Enterprises,
Inc. (incorporated by reference to Exhibit 2.7 to the Company's Registration Statement on Form S-1, File No. 33-
83474)
2.14 Agreement and Plan of Merger dated March 15, 1996 among the Company, Microtek Medical, Inc. and MMI Merger
Corp. (incorporated by reference to the Joint Proxy Statement/Prospectus included in the Company's Registration
Statement on Form S-4, File No. 333-7977).
3.1 Articles of Incorporation of Isolyser Company, Inc. (incorporated by reference to Exhibit 3.1 filed with the Company's
Registration Statement on Form S-1, File No. 33-83474).
3.2* Articles of Amendment to Articles of Incorporation of Isolyser Company, Inc.
3.3 Amended and Restated Bylaws of Isolyser Company, inc. (incorporated by reference to Exhibit 3.2 filed with the
Company's Registration Statement on Form S-1, File No. 33-83474)
3.4 First Amendment to Amended and Restated Bylaws of Isolyser Company, Inc. (incorporated by reference to Exhibit
3.1 to the Company's Current Report on Form 8-K filed July 29, 1996).
3.5 Second Amendment of Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Company's
Current Report on Form 8-K filed December 20, 1996).
4.1 Specimen Certificate of Common Stock (incorporated by reference to Exhibit 4.1 filed with the Company's
Registration Statement on Form S-1, File No. 33-83474)
4.2 Shareholder Protection Rights Agreement dated as of December 20, 1996 between Isolyser Company, Inc. and
SunTrust Bank (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on
December 20, 1996).
10.1 Stock Option Plan and First Amendment to Stock Option Plan (incorporated by reference to Exhibit 4.1 filed with the
Company's Registration Statement on Form S-8, File No. 33-85668)
10.2 Second Amendment to Stock Option Plan (incorporated by reference to Exhibit 4.1 filed with the Company's
Registration Statement on Form S-8, File No. 33-85668)
10.3 Form of Third Amendment to Stock Option Plan (incorporated by reference to Exhibit 10.37 filed with the Company's
Annual Report on Form 10-K for the period ended December 31, 1994)
10.4 Form of Fourth Amendments to the Stock Option Plan (incorporated by reference to Exhibit 10.59 filed with the Company's
Annual Report on Form 10-K for the period ended December 31, 1995).
10.5* Form of Fifth Amendment to Stock Option Plan.
10.6 Form of Incentive Stock Option Agreement pursuant to Stock Option Plan (incorporated by reference to Exhibit 4.2
filed with the Company's Registration Statement on Form S-8, File No. 33-85668)
10.7 Form of Non-Qualified Stock Option Agreement pursuant to Stock Option Plan (incorporated by reference to Exhibit
4.3, filed with the Company's Registration Statement on Form S-8, File No. 33-85668)
10.8 Form of Option for employees of the Company outside of Stock Option Plan (incorporated by reference to Exhibit
10.6 filed with the Company's Registration Statement on Form S-1, File No. 33-83474)
10.9* Employment Agreement of Lester J. Berry.
10.10 Lease Agreement, dated July 29, 1993, between Richard E. Curtis, Trustee and MedSurg Industries, Inc.
(incorporated by reference to Exhibit 10.25 filed with the Company's Registration Statement on Form S-1, File No.
33-83474)
10.11 First Lease Amendment, dated February 28, 1994, between Richard E. Curtis, Trustee and MedSurg Industries, Inc.
(incorporated by reference to Exhibit 10.26 filed with the Company's Registration Statement on Form S-1, File No.
33-83474)
10.12 Lease Agreement, dated October 21, 1991, between Weeks Master Partnership, L.P. and the Company (incorporated
by reference to Exhibit 10.27 filed with the Company's Registration Statement on Form S-1, File No. 33-83474)
10.13 Lease, dated September 28, 1984, between M.S.I. Limited Partnership and MedSurg Industries, Inc. (incorporated
by reference to Exhibit 10.28 filed with the Company's Registration Statement on Form S-1, File No. 33-83474)
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10.14 Amendment No. 1 to Lease, dated October 10, 1984, between M.S.I. Limited Partnership and MedSurg Industries,
Inc. (incorporated by reference to Exhibit 10.29 filed with the Company's Registration Statement on Form S-1, File
No. 33-83474)
10.15 Agreement and Second Amendment to Lease, dated December 31, 1993, between M.S.I. Limited Partnership and
MedSurg Industries, Inc. (incorporated by reference to Exhibit 10.30 filed with the Company's Registration Statement
on Form S-1, File No. 33-83474)
10.16 Third Amendment to Lease, dated September 9, 1994, between M.S.I. Limited Partnership nd Medsurg Industries,
Inc. (incorporated by reference to Exhibit 10.31 filed with the Company's Registration Statement on Form S-1, File
No. 33-83474)
10.17 Lease Agreement, dated October 4, 1990, between Minnetonka Business Associates and Creative Research and
Manufacturing, Inc. (incorporated by reference to Exhibit 10.35 filed with the Company's Registration Statement on
Form S-1, File No. 33-83474)
10.18 Agreement to Extend Lease, dated October 7, 1991, between Minnetonka Business Associates and Creative Research
and Manufacturing, Inc. (incorporated by reference to Exhibit 10.36 filed with the Company's Registration Statement
on Form S-1, File No. 33-83474)
10.19 Agreement to Extend Lease, dated June 23, 1993, between Minnetonka Business Associates and Creative Research
and Manufacturing, Inc. (incorporated by reference to Exhibit 10.37 filed with the Company's Registration Statement
on Form S-1, File No. 33-83474)
10.20 Agreement to Extend Lease dated June 27, 1995, between 7100 Building Company Limited Partnership and Creative
Research and Manufacturing, Inc. (incorporated by reference to Exhibit 10.27 filed with the Company's Registration
Statement on Form S-1 File No. 33-97086)
10.21 Form of Indemnity Agreement entered into between the Company and certain of its officers and directors (incorporated
by reference to Exhibit 10.45 filed with the Company's Registration Statement on Form S-1, File No. 33-83474)
10.22 Amended and Restated Credit Agreement dated as of August 30, 1996, among the Company, MedSurg, Microtek, White Knight,
the Guarantors named therein, the Lenders named therein and The Chase Manhattan Bank (incorporated by referenced
to Exhibit 10.1 of the Company's Current Report on Form 8-K filed on September 13, 1996).
10.23 Lease Agreement, dated November 18, 1994, between Weeks Realty, L.P. and the Company (incorporated by reference
to Exhibit 10.38 filed with the Company's Annual Report on Form 10-K for the period ended December 31, 1994)
10.24 1995 Nonemployee Director Stock Option Plan (incorporated by reference to Exhibit 10.39 filed with the Company's
Annual Report on Form 10-K for the period ended December 31, 1994)
10.25 Agreement and Lease dated October 1, 1992 between Industrial Development Authority of the City of Douglas,
Arizona and White Knight Healthcare, Inc. (incorporated by reference to Exhibit 10.41 filed with the Company's
Registration Statement on Form S-1 File No. 33-97086)
10.26 Product Purchase and Supply Agreement dated February 8, 1993 between White Knight Healthcare, Inc. and Sterile
Concepts, Inc. (incorporated by reference to Exhibit 10.42 filed with the Company's Registration Statement on Form
S-1 File No. 33-97086)
10.27 Non-Negotiable Promissory Note in the original principal amount of $2,304,000.00 dated February 8, 1993 between
White Knight Healthcare, Inc. and Sterile Concepts, Inc. (incorporated by reference to Exhibit 10.43 filed with the
Company's Registration Statement on Form S-1 File No. 33-97086)
10.28 Non-Negotiable Promissory Note in the original principal amount of $1,278,500.00 dated February 8, 1993 between
White Knight Healthcare, Inc. and Sterile Concepts, Inc. (incorporated by reference to Exhibit 10.44 filed with the
Company's Registration Statement on Form S-1 File No. 33-97086)
10.29 Form of Non-Negotiable Promissory Note in the original Principal amount of $750,000 dated September 15, 1995 between
the Company and Ali R. Momtaz (incorporated by reference to Exhibit 10.46 filed with the Company's Registration
Statement on Form S-1 File No. 33-97086)
10.30 Distribution and Marketing Agreement dated September 15, 1995 between the Company and Sterile Concepts, Inc.
(incorporated by reference to Exhibit 10.48 filed with the Company's Registration Statement on Form S-1 File No.
33-97086)
10.31 Agreement, dated November 1, 1992 between Struble & Moffitt Company and United Food and Commercial Workers Union Local
1360, chartered by United Food and Commercial Workers, AFL-CIO (incorporated by reference to Exhibit 10.49 filed
with the Company's Registration Statement on Form S-1 File No. 33-97086)
10.32 Agreement, dated March 18, 1995 between White Knight Hospital Disposables and United Food and Commercial
Workers Local 99R (incorporated by reference to Exhibit 10.50 filed with the Company's Registration
Statement on Form S-1 File No. 33-97086)
10.33 Labor Contract, dated July 22, 1994, between Union of Industrial, Related and Similar Workers of the Municipality
of Agua Prieta, Sonora, C.R.O.M. and Industrias Apson, S.A. de C.V. (incorporated by reference to Exhibit 10.51
filed with the Company's Registration Statement on Form S-1 File No. 33-97086)
10.34 Lease Agreement dated June 21, 1995 between Caballeros Blanca, S.A. de C.V. and Constuctora Immobiliaria del
Norte de Doahuila, S.A. de C.V. (incorporated by reference to Exhibit 10.53 filed with the Company's Registration
Statement on Form S-1 File No. 33-97086)
10.35 Lease, dated August 1, 1987, between HARP, a division of M.B. Haynes Electric Corporation, and Mars/White
Knight, a division of Work Wear Corporation, Inc., as amended by Addendum No. 1 dated July 6, 1987, Addendum
No. 2 dated July 6, 1987, Addendum No. 3 dated May 14, 1990, Addendum No. 4, dated June 17, 1992, second
Addendum No.4 dated June 28, 1993, Addendum No. 5 dated May 26, 1994, Addendum No. 6 dated July 11, 1995,
and Addendum No. 7 dated September 202, 1995 (incorporated by reference to Exhibit 10.55 filed with the
Company's Registration Statement on Form S-1 File No. 33-97086)
10.36 Lease, dated October 1, 1995, between SafeWaste Corporation and Highwoods/Forsyth Limited Partnership (incorporated
by reference to Exhibit 10.56 filed with the Company's Registration Statement on Form S-1 File No. 33-97086)
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10.37 1995 Employee Stock Purchase Plan, as amended by First Amendment dated July 1, 1995 (incorporated by reference
to Exhibit 10.57 filed with the Company's Registration Statement on Form S-1 File No. 33-97086)
10.38 Second Amendment to 1995 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.58 to the
Company vs. Annual Report on Form 10-K for the period ended December 31, 1995)
10.39* Third Amendment to 1995 Employee Stock Purchase Plan
10.40 Asset Exchange Agreement dated July, 1995 between Microtek and Xomed, Inc. (incorporated by reference to Exhibit
10.9 to Microtek's Annual Report on Form 10-K for the period ended November 30, 1995).
10.41 Asset Purchase Agreement dated November 30, 1995 among Microtek, Medi-Plast International, Inc. and certain
affiliates of Medi-Plast International, Inc. (incorporated by reference to Microtek's Current Report on Form 8-K dated
December 8, 1995).
10.42 Asset Purchase Agreement dated April 27, 1996 between Microtek and Advanced Instruments, Inc. (incorporated by
reference to Exhibit 2.1 to Microtek's Current Report on Form 8-K dated May 15, 1996).
10.43 Employment Agreement dated December 31, 1993 between Michael Sahady MedSurg Industries, Inc., Creative
Research and Manufacturing, Inc. and the Company (incorporated by reference to Exhibit 10.1 filed with the
Company's Registration Statement on Form S-1, File No. 33-83474).
10.44 Amendment to Employment Agreement dated as of May 24, 1996 between Michael Sahady, MedSurg Industries, Inc.,
Creative Research and Manufacturing, Inc. and the Company.
10.45 Employment Agreement dated December 31, 1993 between Kenneth Newsome, MedSurg Industries, Inc., Creative
Research and Manufacturing, Inc. and the Company (incorporated by reference to Exhibit 10.2 filed with the
Company's Registration Statement on Form S-1, File No. 33-83474)
10.46 Amendment to Employment Agreement dated as of December 31, 1996 between Kenneth Newsome, MedSurg
Industries, Inc., Creative Research and Manufacturing, Inc. and the Company.
10.47 Form of Sixth Amendment of Isolyser Company, Inc. Stock Option Plan
11.1* Statement re: computation of per share earnings
21.1* Subsidiaries of the Company
23.1* Consent of Deloitte & Touche LLP
23.2* Consent of KPMG Peat Marwick LLP
27.1* Financial Data Schedule
* Previously filed
(b) Reports on Form 8-K:
(1) Form 8-K, dated December 19, 1996, regarding Other Events
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized on June 11, 1997.
ISOLYSER COMPANY, INC.
By: Gene R. McGrevin
Gene R. McGrevin, President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons on behalf of the registrant
in the capacities indicated on June 11, 1997.
SIGNATURE TITLE
Gene R. McGrevin President
Gene R. McGrevin Chairman of the Board of Directors
(principal executive officer)
Peter Schmitt Vice President of Finance,
Peter Schmitt Chief Financial Officer and Treasurer
(principal financial and accounting
officer)
Travis W. Honeycutt Executive Vice President,
Travis W. Honeycutt Secretary and Director
Dan R. Lee Executive Vice President
Dan R. Lee and Director
Rosdon Hendrix Director
Rosdon Hendrix
Kenneth F. Davis Director
Kenneth F. Davis
Olivia F. Kirtley Director
Olivia F. Kirtley
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