SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BIOSYNTECH, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Nevada
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(State or Other Jurisdiction of Incorporation or Organization)
88-0329399
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(I.R.S. Employer Identification No.)
475 Boulevard Armand-Frappier, Laval, Quebec, Canada H7V 4B3
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(Address of Principal Executive Offices) (Zip Code)
BioSyntech, Inc. Stock Option Incentive Plan
Bio Syntech Canada Inc. Stock Option Incentive Plan
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(Full Title of the Plans)
Mr. David J. Adler, Esq.
Olshan Grundman Frome Rosenzweig & Wolosky LLP
505 Park Avenue, 16th Floor
New York, New York 10022
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(Name and Address of Agent for Service)
(212) 753-7200
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(Telephone Number, Including Area Code, of Agent for Service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price per Offering Registration
Registered Registered(1) Share Price Fee
---------- ------------- ----- ----- ---
Common Stock, $.001 par value per share,
issuable under the BioSyntech, Inc. Stock
Option Incentive Plan 2,500,000 $1.47 $3,559,470 $939.70
shares (2)
Common Stock, $.001 par value per share,
issuable upon the exchange of non-voting
exchangeable preferred stock issuable under
to the Bio Syntech Canada Inc. Stock Option
Incentive Plan
1,499,500 CDN$1.04 $1,001,593 $264.42
shares (3) (3)
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Total 3,999,500 $1,204.12
1. Pursuant to Rule 416 promulgated under the Securities Act of 1933,
as amended (the "Securities Act"), this Registration Statement also
registers such number of additional shares of common stock, $.001
par value per share (the "Common Stock") that may be offered or
issued pursuant to the BioSyntech, Inc. Stock Option Incentive Plan
(the "BSI Plan") and the Bio Syntech Canada, Inc. Stock Option
Incentive Plan (the "BSC Plan" and together with the BSI Plan, the
"BioSyntech Plans") to prevent dilution resulting from stock splits,
stock dividends or similar transactions.
2. Includes an aggregate of 600,000 shares of Common Stock with respect
to which options were granted under the BSI Plan at an average
exercise price of $3.66 per share. An additional 1,900,000 shares of
Common Stock may be offered under the BSI Plan. Pursuant to Rules
457(g) and (h) under the Securities Act, the offering price for the
shares of Common Stock which may be issued under the BSI Plan is
estimated solely for the purpose of determining the registration fee
and is based on $0.7188, the per share average of high and low
closing bid and ask prices of the Common Stock as reported by the
OTC Bulletin Board for March 26, 2000.
3. Consists of aggregate of 1,499,500 shares with respect to which
options were granted under the BSC Plan at an average exercise price
of CDN $1.04 per share. The foreign currency rate of March 26, 2001
of CDN $1.5570 to US $1 was used to compute the applicable
registration fee.
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EXPLANATORY NOTE
BioSyntech, Inc. (the "Company") has prepared this registration
statement in accordance with the requirements of Form S-8 (the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
to register shares of our common stock, $.001 par value per share (the "Common
Stock"), issuable pursuant to the BioSyntech, Inc. Stock Option Incentive Plan
(the "BSI Plan") and issuable upon the exchange of non-voting exchangeable
preferred stock issuable under the Bio Syntech Canada Inc. Stock Option
Incentive Plan (the "BSC Plan" and together with the BSI Plan, the "BioSyntech
Plans").
This Form S-8 includes a reoffer prospectus prepared in accordance
with Part I of Form S-3 under the Securities Act. The reoffer prospectus may be
utilized for reofferings and resales of shares of Common Stock acquired pursuant
to the BioSytench Plans by selling stockholders who may be deemed "affiliates"
(as such term is defined in Rule 405 under the Securities Act) of the Company.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The Company will provide documents containing the information
specified in Part I of this Form S-8 to employees as specified by Rule 428(b)(1)
of the Securities Act. Pursuant to the instructions to Form S-8, the Company is
not required to file these documents either as part of this Registration
Statement or as prospectuses or prospectus supplements pursuant to Rule 424 of
the Securities Act.
-iii-
PROSPECTUS
BIOSYNTECH, INC.
3,999,500 Shares
Common Stock ($.001 par value)
This prospectus relates to the reoffer and resale by certain selling
stockholders of shares of our common stock that we may be to the selling
stockholders upon the exercise of stock options granted under our stock option
plan or upon the exchange of shares of non-voting exchangeable preferred stock
of our subsidiary, Bio Syntech Canada Inc., issuable under their stock option
plan. This prospectus also relates to certain underlying options that have not
as of this date been granted. If and when such options are granted to persons
required to use the prospectus to reoffer and resell the shares underlying such
options, we will distribute a prospectus supplement. The shares are being
reoffered and resold for the account of the selling stockholders and we will not
receive any of the proceeds from the resale of the shares.
The selling stockholders have advised us that the resale of their
shares may be effected from time to time in one or more transactions on the OTC
Bulletin Board, in negotiated transactions or otherwise, at market prices
prevailing at the time of the sale or at prices otherwise negotiated. See "Plan
of Distribution." We will bear all expenses in connection with the preparation
of this prospectus.
Our common stock is listed on the OTC Bulletin Board. On March 26,
2001, the closing price per share for our common stock, as reported by the OTC
Bulletin Board, was $0.7188.
This investment involves risk. See "Risk Factors" beginning at page 5.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION HAS DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. THEY HAVE NOT MADE, NOR WILL THEY MAKE, ANY DETERMINATION AS TO
WHETHER ANYONE SHOULD BUY THESE SECURITIES. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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The date of this Prospectus is April 3, 2001.
1
TABLE OF CONTENTS
INCORPORATION BY REFERENCE.....................................................3
ABOUT THIS PROSPECTUS..........................................................3
WHERE YOU CAN FIND MORE INFORMATION............................................4
RISK FACTORS...................................................................5
THE COMPANY....................................................................9
USE OF PROCEEDS...............................................................10
SELLING STOCKHOLDERS..........................................................10
PLAN OF DISTRIBUTION..........................................................11
EXPERTS.......................................................................12
LEGAL MATTERS.................................................................12
ADDITIONAL INFORMATION........................................................12
2
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" the information we
file with them, which means that we can disclose important information to you by
referring you to those documents. The information we incorporate by reference is
considered to be a part of this prospectus and information that we file later
with the SEC will automatically update and replace this information. We
incorporate by reference the documents listed below and any future filings we
make with the SEC under Sections 13(a) and 15(d) of the Securities Exchange Act:
1. Our annual report for fiscal year ended March 31, 2000, on Form
10-KSB.
2. Our quarterly reports for quarters ended June 30, 2000,
September 30, 2000 and December 31, 2000, on Form 10-QSB.
3. Our registration statement amendment no. 2 on Form SB-2/A filed
with Securities and Exchange Commission on March 22, 2001 under
registration no. 333-45756;
4. Our current report on Form 8-K dated March 15, 2000 and an
amendment to the current report on Form 8-K/A dated May 15,
2000.
5. Our current report on Form 8-K dated January 30, 2001.
6. A description of our common stock, in our registration
statement on Form 10-SB filed August 30, 1999.
You may request a copy of these filings, excluding the exhibits to
such filings which we have not specifically incorporated by reference in such
filings, at no cost, by writing or calling us at the following address and
telephone number:
BioSyntech, Inc.
475 Boulevard Armand-Frappier
Montreal (Laval) Quebec
Canada H7V 4B3
Attention: Mr. Anthony Casola
Telephone Number: (450) 686-2437
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement we filed with
the SEC. You should rely only on the information provided or incorporated by
reference in this prospectus or any related supplement. We have not authorized
anyone else to provide you with different information. The selling stockholders
will not make an offer of these shares in any state where the offer in not
permitted. You should not assume that the information in this prospectus or any
supplement is accurate as of another date than the date on the front of those
documents.
3
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any document we file at the SEC's public reference room located at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain
further information on the operation of the public reference room by calling the
SEC at 1-800-SEC-0330. Our SEC filings are also available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also request
copies of such documents, upon payment of a duplicating fee, by writing to the
SEC at 450 Fifth Street, N.W., Washington, D.C. 20549.
4
RISK FACTORS
An investment in our common stock involves a high degree of risk. In
addition to the other information contained in this prospectus, you should
carefully consider the following risk factors before investing in our common
stock.
Since our inception, we have incurred losses and we expect that we
will incur more losses for the foreseeable future. We also may never
become profitable.
We have had net operating losses since being founded and currently
have an accumulated deficit. These losses consist of research and development
costs and general and administrative expenses. We expect to have substantial
additional expenses over the next several years as our research and development
activities and the process of seeking regulatory approval of our products,
including clinical trials, accelerate. Because we do not expect to have
significant revenues from the sale of products for several years, if ever, we
expect that those expenses will result in additional losses.
Our future profitability depends, in part, on:
o Obtaining regulatory approval for our products;
o Entering into agreements to develop and commercialize
products;
o Developing the capacity to manufacture and market products or
entering into agreements with others to do so;
o Market acceptance of our products;
o The ability to obtain additional funding from our
collaborative partners; and
o The ability to achieve certain product development
milestones.
We may not achieve any or all of these goals and are unable to
predict whether we will ever achieve significant revenues or profits. Even if we
receive regulatory approval for one or more of our products, we may not achieve
significant commercial success.
We may need additional financing to continue our operations after
April 1, 2002 and will need substantial funds before we are
profitable.
Based on our current operating plan, we estimate that the cash on
hand and anticipated receipts will fund our operations only until April 1, 2002.
Accordingly, in order to continue operating after April 1, 2002, we may need
additional financing. If we do not receive additional financing, we will
reassess our operating plan to reduce expenses. In addition, we need to raise
substantial amounts of money if we are ever to become profitable. If sufficient
financing is unavailable on a timely basis, we may have to curtail development
programs or transfer rights in products that could later prove to be of great
value. The financing we require and when we will spend it, will depend, in part,
on:
o How our research and development programs, including clinical
trials, progress;
o How much time and expense will be required to receive FDA
approval for our product candidates;
o The cost of building, operating and maintaining manufacturing
facilities;
o How many product candidates we pursue;
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o How much time and money we need to prosecute and enforce
patent rights;
o How competing technological and market developments affect
our product candidates; and
o The cost of obtaining licenses to use technology owned by
others.
We will seek funds by issuing equity and debt securities and through
arrangements with our collaborative partners. We currently have no commitments,
agreements or understandings regarding additional financing or any current
funding arrangement with any of our collaborative partners and we may be unable
to obtain additional financing or enter into a funding arrangement with any of
our collaborative partners on satisfactory terms, or at all. In addition, if we
issue equity securities, our present stockholders will suffer dilution. If we
issue debt securities, we will face the risks associated with debt, including
rises in interest rates and insufficient cash flow to pay the principal of and
interest on our debt securities.
There are factors beyond our control that may prevent our delivery
technologies from producing safe, useful or commercially viable
products. Accordingly, we may never become profitable.
To be profitable, we must develop, manufacture and market our
products, either alone or by collaborating with others. This process could take
several years and we may never be successful in bringing our product candidates
to the market. Additionally, our success in pre-clinical and early clinical
trials does not ensure that large scale clinical trials will be successful.
Clinical results are frequently susceptible to varying interpretations that may
delay, limit or prevent further clinical development or regulatory approvals.
Our products may:
o Be shown to be ineffective or to cause harmful side effects;
o Fail to receive regulatory approval on a timely basis or at
all;
o Be hard to manufacture on a large scale;
o Be uneconomical;
o Not be pursued by our collaborative partners;
o Not be prescribed by doctors or accepted by patients; or
o Infringe on proprietary rights of another party.
If the Food and Drug Administration does not approve or
significantly delays the approval of our therapeutic delivery
products, we may be unable to continue operations.
FDA approval is required to manufacture and market pharmaceutical
products in the United States. The process to receive this approval is extensive
and includes pre-clinical testing and clinical trials to demonstrate safety and
efficacy, and a review of the manufacturing process to ensure compliance with
good manufacturing practices. This process can last many years and be very
costly and still be unsuccessful. The length of time necessary to complete
clinical trials and receive approval for product marketing by regulatory
authorities varies significantly by product and indication and is difficult to
predict. If the Food and Drug Administration does not approve or significantly
delays the approval of our therapeutic delivery products, we may be unable to
continue operations. FDA approval can be delayed, limited or denied for many
reasons, including:
o A product candidate may not be safe or effective;
o Data from pre-clinical testing and clinical trials can be
interpreted by FDA officials in different ways than we
interpret it;
6
o The FDA might not approve our manufacturing processes or
facilities;
o The FDA may change its approval policies or adopt new
regulations; and
o A product candidate may not be approved for all the uses we
requested.
Countries other than the United States, including Canada, have
similar requirements. The process of getting approvals in foreign countries is
subject to delay and failure for the same reasons.
If our present and future arrangements with our collaborators and
licensees are unsuccessful, we may be unable to continue operations
due to substantial additional operating costs.
We are designing delivery systems for medications and drug products
that are protected by our licensees' or collaborators' patents. In some cases,
we depend on these parties to conduct pre-clinical testing and clinical trials
and in the future, we may seek to have these parties fund our development
programs. Our agreements with our collaborators currently do not provide for
financing. If we are unable to reach satisfactory agreements with our
collaborators or with third parties, we would incur substantial additional costs
and would experience substantial delay in commercializing most of our products.
Some of our collaborators can terminate their agreements with us for no reason
and on limited notice. We are unsure whether any of these relationships will
continue.
Our present plans call for us to develop the capabilities to
manufacture our own products in commercial quantities. We may rely upon our
collaborators and or licensees for the marketing and sales of our products.
We have limited means of enforcing our collaborators' or licensees'
performance or of controlling the resources they devote to our programs. If a
collaborator fails to perform, the research, development or commercialization
program on which it is working will be delayed. If this happens, we may have to
stop the program entirely.
Disputes may arise between us and a collaborator and may involve the
issue of which of us owns the technology that is developed during a
collaboration. A potential dispute could delay the program or result in
expensive arbitration or litigation, which we might not win. A collaborator may
choose to use its own or other technology to deliver its drug or cell product.
Our collaborators could merge with or be acquired by another company or
financial or operational difficulties that could adversely affect our programs.
Proprietary protection for our products is uncertain and we could
become involved in costly litigation and be prevented from selling
our products.
The following factors are important to our success:
o Receiving patent protection for our product candidates and
those of our collaborators;
o Maintaining our trade secrets;
o Not infringing on the proprietary rights of others; and
o Preventing others from infringing our proprietary rights.
We can protect our proprietary rights from unauthorized use by third
parties only if these rights are covered by valid and enforceable patents or are
effectively maintained as trade secrets. Otherwise, we could become involved in
costly litigation and be prevented from selling our products.
We try to protect our proprietary position by filing United States,
Canadian, and foreign patent applications related to our proprietary technology,
inventions and improvements that are important to the development of our
business. The patent position of biopharmaceutical companies involves complex
legal and factual questions.
7
Enforceability of patents cannot be projected with certainty. Patents, if
issued, may be challenged, invalidated or circumvented. Any patents that we own
or license from others may provide no protection against competitors. Our
pending patent applications, those we may file in the future, or those we may
license from third parties, may not result in patents being issued. If patents
do issue, they may not provide us with proprietary protection or competitive
advantages against competitors with similar technology. Also, others may
independently develop similar technologies or duplicate any technology that we
have developed. The laws of certain foreign countries may not protect our
intellectual property rights to the same extent as the laws of the United
States.
We also rely on trade secrets, know-how and technology, which we try
to protect by entering into confidentiality agreements with parties that have
access to it, including our corporate partners, collaborators, employees and
consultants. Any of these parties may breach the agreement and disclose our
confidential information or our competitors might learn of the information in
some other way.
Foreign exchange fluctuations of the Canadian Dollar may affect our
financial performance, because it is not cost-effective for us to
enter into forward contracts or currency options.
We expect a substantial portion of our revenues to be based on sales
and services rendered to come from the United States, while a significant amount
of our operating expenses will be incurred in Canada. As a result, our financial
performance will be affected by fluctuations in the value of the United States
dollar to the Canadian dollar. At the present time, we have no plan or policy to
utilize forward contracts or currency options to minimize this exposure, and
even if these measures are implemented, we are unsure whether these arrangements
will be available, be cost effective or be able to fully offset future currency
risks.
Our common stock currently is and may continue to be subject to
additional regulations applicable to lower priced securities, which
makes it cumbersome for broker-dealers to sell our securities.
Our common stock may be subject to a number of regulations that can
affect its price and your ability to sell it. For example, Rule 15g-9 under the
Exchange Act may apply to our common stock. This rule imposes sales practice
requirements on broker-dealers that sell low priced securities to persons other
than established customers and institutional accredited investors. For
transactions covered by this rule, a broker-dealer must make a special
suitability determination for the purchaser and have received the purchaser's
written consent to the transaction.
In addition, under United States securities regulations, penny
stocks generally are equity securities with a price of less than $5.00 per share
other than securities registered on certain national securities exchanges or
quoted on the Nasdaq Stock Market. For any transaction involving a penny stock,
unless exempt, the penny stock rules require the delivery, prior to the
transaction, of a disclosure schedule prescribed by the Securities and Exchange
Commission relating to the penny stock market. The broker-dealer must also
disclose the commissions payable to both the broker-dealer and the registered
representative and current quotations for the securities. Finally, monthly
statements must be sent disclosing recent price information on the limited
market in penny stocks. Consequently, the penny stock rules may restrict the
ability of broker-dealers to sell our common stock. The penny stock rules will
not apply if the market price of our common stock is $5.00 or greater. These
requirements may reduce the level of trading activity in any secondary market
for our common stock and may adversely affect the ability of broker-dealers to
sell our securities.
We may not accurately predict business trends which consequently
makes our forward looking statements incorrect.
This prospectus includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. The words "believe", "anticipate", "estimate",
"expect" or words of similar import identify these forward-looking statements.
These forward-looking statements are contained principally under the headings
"Summary", "Risk Factors", "Management's Discussion and Analysis to Financial
Condition and Results of Operations" and "Business". Although we have based
these forward-looking statements on management's analysis of the business trends
in the biotechnology industry, these forward-looking statements are subject to
risks and uncertainties. Our actual results may differ materially from the
8
expectations expressed by these forward-looking statements. Important factors
that may cause actual results to differ materially from the expectations
reflected in the forward-looking statements include, but not limited to, those
set forth below:
o general economic, business and market conditions;
o customer acceptance of new products; and
o the occurrence or nonoccurrence of circumstances beyond our control.
All subsequent written and oral forward-looking statements
attributable to us are expressly qualified in their entirety by the cautionary
statements. We caution readers not to place undue reliance on these
forward-looking statements, which speak only as of their dates. We undertake no
obligations to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
THE COMPANY
We are an advanced biomaterials company specialized in tissue
engineering and therapeutic delivery. Our main focus is the repair of damaged
tissue in the human body like bone or cartilage. We are also engaged in the
development of advanced injectable biomaterials for the delivery of cells and
genetic material and biotherapeutic agents. We have had limited revenues to date
and they have come entirely from sales in the our instrumentation division. Our
future operations are dependent upon our receiving the financing necessary to
complete research and development projects and market our products. We are
unsure whether we can complete the development of our products, or if we
complete them whether we can successfully market them or generate sufficient
revenues to fund our future operations or additional research, development and
marketing. In addition, major technological changes can occur quickly in the
biotechnological and pharmaceutical industries. The development by competitors
of technologically improved or different products may make our products obsolete
or noncompetitive.
Our research and development efforts are focused on maximizing the
multiple benefits of our core technologies, which include:
o tissue engineering;
o the therapeutic delivery of cells;
o genetic material for site specific gene therapy; and
o the delivery of biotherapeutic agents.
Our technologies apply to diverse specialties, which include
orthopedics and rheumatology. Orthopedic and rheumatology problems include
cartilage injuries and diseases as well as bone injuries and diseases, vaccines,
and the delivery of biotherapeutic agents.
We also have an instrumentation division wherein we are developing
the ARTHRO-BSTTM and the Mach-1TM Mechanical Tester. ARTHRO-BST(TM) is a device
used for visual examination of the interior of the articular cartilage with a
special surgical instrument which provides precise and non-destructive
diagnosis. The Mach-1TM Mechanical Tester is a universal mechanical testing
system for specimens with dimensions between hundreds of microns and a few
centimeters.
9
Our principal executive offices are located at 475, boulevard
Armand-Frappier, Montreal (Laval) Quebec, Canada H7V 4B3. Our telephone number
is (450) 686-2437.
USE OF PROCEEDS
This prospectus relates to an aggregate of 3,999,500 shares of our
common stock that may be sold from time to time by the selling stockholders. All
net proceeds from the sale of the common stock will go the stockholders who
offer and sell their shares. We will not receive any part of the proceeds from
such sales of common stock. We will, however, receive the exercise price of the
options at the time of their exercise. If all of the options are exercised, we
will realize proceeds in the amount of approximately $1,588,788. Such proceeds
will be contributed to working capital and will be used for general corporate
purposes.
SELLING STOCKHOLDERS
This prospectus relates to the reoffer and resale of shares issued
or that may be issued to the selling stockholders under our stock option plan or
upon the exchange of shares of non-voting exchangeable preferred stock of our
subsidiary, Bio Syntech Canada Inc., issuable under their stock option plan.
The following table sets forth (i) the number of shares of common
stock beneficially owned by each selling stockholder at March 26, 2001, (ii) the
number of shares to be offered for resale by each selling stockholder (i.e., the
total number of shares underlying options held by each selling stockholder
irrespective of whether such options are presently exercisable or exercisable
within sixty days of March 26, 2001), and (iii) the number and percentage of
shares of our common stock to be held by each selling stockholder after
completion of the offering. The table assumes that the selling stockholders will
sell all of the shares and that the selling stockholders will make no other
purchases or sales of our common stock. However, the selling stockholders are
not obligated to sell their shares at any time or at any price. We cannot state
with certainty the number of shares of our common stock that will be owned by
each of the selling stockholders upon the termination of this offering. The
number of shares of our common stock that each holder may own may also change
due to stock splits or other anti-dilution adjustments. All percentages are
based on 29,182,250 shares of our common stock outstanding as of March 26, 2001.
Percentage of Shares of
Shares of common common Percentage of
common stock stock Shares of Stock common stock
Beneficially Beneficially common Beneficially Beneficially
Name and Address of Owned Before Owned Before stock being Owned After Owned After
Beneficial Owner Offering Offering Offered Offering Offering
---------------- -------- -------- ------- -------- --------
Dr. Amine Selmani 9,087,500 30.6% 562,500 8,525,000 28.7%
Chairman of the Board, Chief
Executive Officer and President
Denis N. Beaudry 50,000 0.2% 50,000 0 0%
Director
Pierre Alary 50,000 0.2% 50,000 0 0%
Director
Jean-Yves Bourgeois 50,000 0.2% 50,000 0 0%
Director
Dr. Pierre Ranger 150,000 0.5% 150,000 0 0%
Director
10
Percentage of Shares of
Shares of common common Percentage of
common stock stock Shares of Stock common stock
Beneficially Beneficially common Beneficially Beneficially
Name and Address of Owned Before Owned Before stock being Owned After Owned After
Beneficial Owner Offering Offering Offered Offering Offering
---------------- -------- -------- ------- -------- --------
Ajay Gupta 75,000 0.3% 75,000 0 0%
Chief Operating Officer
Anthony Casola 50,000 0.2% 50,000 0 0%
Chief Financial Officer and Secretary
--------- ------- ---------
TOTAL 9,512,500 31.3% 987,500 8,525,000 28.7%
Dr. Selmani owns indirectly 9083-1496 Quebec Inc. and has shared
voting and dispositive power with respect to the 7,640,000 shares of non-voting
exchangeable preferred stock owned by 9083-1496 Quebec Inc. Dr. Selmani also may
be deemed the beneficial owner of 312,500 shares of common stock that would be
held by him upon exchange of 312,500 shares of non-voting exchangeable preferred
stock issuable upon exercise of options. Monique Jarry, the spouse of Dr.
Selmani, owns 1,085,000 shares of non-voting exchangeable preferred stock,
including 200,000 shares issuable upon the exercise of options.
PLAN OF DISTRIBUTION
As referred to in this prospectus, selling stockholders include the
pledgees, donees, transferees or others who may later hold the selling
stockholders' beneficial ownership of shares of common stock. We will file a
post-effective amendment registration statement to identify the pledgees,
donees, transferees of the shares currently held by the selling stockholders. We
will pay the costs and fees of registering the shares of common stock, but the
selling stockholders will pay any brokerage commissions, discounts or other
expenses relating to the sale of these shares.
The selling stockholders may sell the shares of common stock in the
over-the-counter market or otherwise, at market prices prevailing at the time of
sale, at prices related to the prevailing market prices or at negotiated prices.
In addition, the selling stockholders may sell some or all of their shares
through:
o a block trade in which a broker-dealer may resell a portion of
the block, as principal, in order to facilitate the
transaction;
o purchases by a broker-dealer, as principal, and resale by the
broker-dealer for its account; or
o ordinary brokerage transactions and transactions in which a
broker solicits purchasers.
When selling the shares of common stock, the selling stockholders
may enter into hedging transactions. For example, the selling stockholders may:
o enter into transactions involving short sales of the shares by
broker-dealers;
o sell shares short themselves and redeliver the shares to close
out their short positions;
o enter into option or other types of transactions that require
the selling stockholder to deliver shares to a broker-dealer,
who will then resell or transfer the common shares under this
prospectus; or
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o loan or pledge the shares to a broker-dealer, who may sell the
loaned shares or, in the event of default, sell the pledged
shares.
The selling stockholders may negotiate and pay broker-dealers
commissions, discounts or concessions for their services. Broker-dealers engaged
by the selling stockholders may allow other broker-dealers to participate in
resales. However, the selling stockholders and any broker-dealers involved in
the sale or resale of the shares of our common stock may qualify as underwriters
within the meaning of Section 2(a)(11) of the Securities Act. In addition, the
broker-dealers' commissions, discounts or concession may qualify as
underwriters' compensation under the Securities Act.
In addition to selling their shares under this prospectus, the
selling stockholders may:
o agree to indemnify any broker-dealer or agent against
liabilities related to the selling of the shares, including
liabilities arising under the Securities Act;
o transfer their shares in other ways not involving market
makers or established trading markets, including directly by
gift, distribution or other transfer; or
o sell their shares under Rule 144 of the Securities Act rather
than under this prospectus, if the transaction meets the
requirements of Rule 144.
EXPERTS
Our consolidated financial statements as of March 31, 2000 and March
31, 1999 and for the fiscal years ended March 31, 2000 and March 31, 1999 are
incorporated by reference to the Annual Report on Form 10-KSB filed with the SEC
on September 15, 2000 and have been audited by Ernst & Young LLP, independent
auditors, as is set forth in their consent appearing elsewhere in this document
and included in reliance upon the authority of this firm as experts in
accounting and auditing. We have also incorporated by reference our consolidated
financial statements for the quarters ended June 30, 1999 and June 30, 2000,
September 30, 1999 and September 30, 2000 and December 31, 1999 and December 31,
2000 to the Annual Report.
LEGAL MATTERS
The legality of the shares of our common stock offered will be
passed upon for us by Olshan Grundman Frome Rosenzweig & Wolosky LLP, New York,
New York.
ADDITIONAL INFORMATION
We have filed with the SEC a registration statement on Form S-8
under the Securities Act with respect to the shares of common stock being
offered. Statements contained in this prospectus as to the contents of any
contract or other document are not necessarily complete, and in each instance,
reference is made to the copy of such contract or document filed as an exhibit
to the registration statement, each such statement being qualified in all
respects by such reference.
12
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3 Incorporation of Documents By Reference
The following documents filed by the "Company with the Securities
and Exchange Commission are incorporated herein by reference:
1. The Company's Annual Report for fiscal year ended March 31,
2000, on Form 10-KSB.
2. The Company's Quarterly Report for quarters ended June 30,
2000, September 30, 2000 and December 31, 2000, on Form
10-QSB.
3. The Company's Registration Statement Amendment No. 2 on Form
SB-2/A filed with the Securities and Exchange Commission on
March 22, 2001 under Registration No. 333-45756.
4. The Company's Current Report on Form 8-K dated March 15, 2000
and an amendment thereto on Form 8-K/A dated May 15, 2000.
5. The Company's Current Report on Form 8-K dated January 30,
2001.
6. The description of the Company's Common Stock, $.001 par value
(the "Common Stock"), in the Company's Registration Statement
on Form 10-SB filed August 30, 1999.
All documents filed by the Company pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, after
the effective date of this registration statement and prior to the filing of a
post-effective amendment which indicates that all securities offered hereunder
have been sold or which deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference herein and to be a part hereof from
the date of filing of such documents.
Item 4. Description of Securities
Not Applicable
Item 5. Interest of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
Section 5.1 of the Company's By-laws provides that the Company shall
indemnify its directors, officers and agents to the fullest extent possible
under the Nevada General Corporate Law ("NGCL"). Section 5.1 of the Company's
By-laws in part states that:
"(a) The Corporation shall indemnify, subject
to the requirements of subsection (d) of this Section, any
person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of
the Corporation), by reason of the fact that he is or was
a director, officer, employee or agent of the Corporation,
or is or was serving at the request of the Corporation as
a director, officer, employee or agent of another
Corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually
and reasonably incurred by such person in connection with
such action, suit or proceeding if he acted in good faith
and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation and, with
respect to any criminal action or proceeding, had no
reasonable cause to believe such person's conduct was
unlawful. The termination of any action, suit or
proceeding
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by judgment, order, settlement, conviction or upon a plea
of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the
Corporation and, with respect to any criminal action or
proceeding, had reasonable cause to believe that such
person's conduct was unlawful.
(b) The Corporation shall indemnify, subject
to the requirements of subsection (d) of this Section, any
person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he is or
was a director, officer, employee or agent of the
Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys'
fees) actually and reasonably incurred by such person in
connection with the defense or settlement of such action
or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best
interests of the Corporation. Indemnification may not be
made for a claim, issue or matter as to which such a
person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals therefrom,
to be liable to the Corporation or for amounts paid in
settlement to the Corporation, unless and only to the
extent that the court in which the action or suit was
brought or other court of competent jurisdiction
determines upon application that in view of all the
circumstances of the case, the person is fully and
reasonably entitled to indemnity for such expenses as the
court deems proper.
(c) To the extent that a present or former
director or officer of the Corporation has been successful
on the merits or otherwise in defense of any action, suit
or proceeding referred to in subsection (a) and (b) of
this section, or in defense of any claim, issue or matter
therein, the Corporation shall indemnify such person
against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection
therewith.
(d) Any indemnification under subsections (a)
and (b) of this section (unless ordered by a court) may be
made by the Corporation only as authorized in the specific
case upon a determination that indemnification of the
present or former director, officer, employee or agent is
proper in the circumstances because such person has met
the applicable standard of conduct set forth in
subsections (a) and (b) of this section. Such
determination shall be made with respect to a person who
is a director or officer at the time of such determination
(1) by a majority vote of the directors who are not
parties to such action, suit or proceeding, even though
less than a quorum, or (2) if there are no such directors,
or if such directors so direct, by independent legal
counsel in a written opinion or (3) by the stockholders."
and
"Expenses incurred by a director, officer, employee or
agent in defending a civil or criminal action, suit or proceeding
shall be paid by the Corporation in advance of the final disposition
of such action, suit or proceeding as authorized by the Board of
Directors upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount if it
shall ultimately be determined that such person is not entitled to
be indemnified by the Corporation as authorized in this section."
Section 5.1 of the Company's By-laws is consistent with the
indemnification provisions in the NGCL which allow for discretionary and
mandatory indemnification of a corporation's officers, directors, employees and
agents. Section 78.7502 of the NGCL provides for the general concept of
indemnification and Section 78.751 of the NGCL provides for authorization,
advance and limitation of such indemnification.
Section 78.7502 of the NGCL states that:
"1. A corporation may indemnify any person who
was or is a party or is threatened to be made a party to
any threatened, pending or completed action, suit or
proceeding, whether civil,
II-2
criminal, administrative or investigative, except an
action by or in the right of the corporation, by reason of
the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer,
employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against
expenses, including attorneys' fees, judgments, fines and
amounts paid in settlement actually and reasonably
incurred by him in connection with the action, suit or
proceeding if he acted in good faith and in a manner which
he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its
equivalent, does not, of itself, create a presumption that
the person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best
interests of the corporation, and that, with respect to
any criminal action or proceeding, he had reasonable cause
to believe that his conduct was unlawful.
2. A corporation may indemnify any person who
was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or
in the right of the corporation to procure a judgment in
its favor by reason of the fact that he is or was a
director, officer, employee or agent of the corporation,
or is or was serving at the request of the corporation as
a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise against expenses, including amounts paid in
settlement and attorneys' fees actually and reasonably
incurred by him in connection with the defense or
settlement of the action or suit if he acted in good faith
and in a manner which he reasonably believed to be in or
not opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue or
matter as to which such a person has been adjudged by a
court of competent jurisdiction, after exhaustion of all
appeals therefrom, to be liable to the corporation or for
amounts paid in settlement to the corporation, unless and
only to the extent that the court in which the action or
suit was brought or other court of competent jurisdiction
determines upon application that in view of all the
circumstances of the case, the person is fairly and
reasonably entitled to indemnity for such expenses as the
court deems proper.
3. To the extent that a director, officer,
employee or agent of a corporation has been successful on
the merits or otherwise in defense of any action, suit or
proceeding referred to in subsections 1 and 2, or in
defense of any claim, issue or matter therein, he must be
indemnified by the corporation against expenses, including
attorneys' fees actually and reasonably incurred by him in
connection with the defense."
II-3
Section 78.751 of the NGCL states that:
"(1) Any discretionary indemnification under Section
78.7502 of the NGCL, unless ordered by a court or advanced pursuant
to subsection 2, may be made by the corporation only as authorized
in the specific case upon a determination that indemnification of
the director, officer, employee or agent is proper in the
circumstances. The determination must be made:
(a) By the shareholders;
(b) By the board of directors by majority vote of
a quorum consisting of directors who were not parties to
the action, suit or proceeding;
(c) If a majority vote of a quorum consisting of
directors who were not parties to the action, suit or
proceeding so orders, by independent legal counsel in a
written opinion; or
(d) If a quorum consisting of directors who were
not parties to the action, suit or proceeding cannot be
obtained, by independent legal counsel in a written
opinion.
(2) The articles of incorporation, the bylaws or an
agreement made by the corporation may provide that the expenses of
officers and directors incurred in defending a civil or criminal
action, suit or proceeding must be paid by the corporation as they
are incurred and in advance of the final disposition of the action,
suit or proceeding, upon receipt of an undertaking by or on behalf
of the director or officer to repay the amount if it is ultimately
determined by a court of competent jurisdiction that he is not
entitled to be indemnified by the corporation. The provisions of
this subsection do not affect any rights to advancement of expenses
to which corporate personnel other than directors or officers may be
entitled under any contract or otherwise by law.
(3) The indemnification and advancement of expenses
authorized in or ordered by a court pursuant to this section:
(a) Does not exclude any other rights to which a
person seeking indemnification or advancement of
expenses may be entitled under the articles of
incorporation or any bylaw, agreement, vote of
shareholders or disinterested directors or otherwise,
for either an action in his official capacity or an
action in other capacity while holding his office,
except that indemnification, unless ordered by a court
pursuant to Section 78.7502 of the NGCL or for the
advancement of expenses made pursuant to subsection 2,
may not be made to or on behalf of any director or
officer if a final adjudication establishes that his
acts or omissions involved intentional misconduct, fraud
or a knowing violation of the law and was material to
the cause of action.
(b) Continues for a person who has ceased to be a
director, officer, employee or agent and inures to the
benefit of the heirs, executors and administrators of
such a person."
Item 7. Exemption From Registration Claimed
Not Applicable.
II-4
Item 8. Exhibits.
Exhibit Index
4.1 Bio Syntech Canada Inc. Stock Option Incentive Plan.
4.2 BioSyntech, Inc. Stock Option Incentive Plan.
5.1 Opinion of Olshan Grundman Frome Rosenzweig & Wolosky LLP.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Olshan Grundman Frome Rosenzweig & Wolosky LLP (included
in Exhibit 5.1).
24.1 Power of Attorney (included on the signature page of this
Registration Statement).
Item 9. Undertakings
The undersigned registrant hereby undertakes that if the Company
registers securities under Rule 415 of the Securities Act, it will:
a. File, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement to:
1. Include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
2. Reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
Registration Statement;
3. Include any material information with respect to the plan
of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (1) and (2) above 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 registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the
Registration Statement;
b. For the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof; and
c. 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.
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the city of Laval, province of Quebec, Canada, on this 2nd day of
April, 2001
BIOSYNTECH, INC.
By: /s/ Amine Selmani
--------------------------------------
Name: Dr. Amine Selmani
Title: Chief Executive Officer &
President
POWER OF ATTORNEY
BioSyntech, Inc. and each of the undersigned do hereby appoint Dr.
Amine Selmani, its or his true and lawful attorney to execute on behalf of
BioSyntech, Inc. and the undersigned any and all amendments to this Registration
Statement on Form S-8 and to file the same with all exhibits thereto and other
documents in connection therewith, with the Securities and Exchange Commission.
Pursuant to the requirements of the Securities Exchange Act of 1934,
this Registration Statement on Form S-8 has been signed below by the following
persons on behalf of the Company and in the capacities and on the dates
indicated.
Signature Title Date
- --------- ----- ----
/s/ Amine Selmani Chairman of the Board April 2, 2001
- ----------------------- Chief Executive Officer
Amine Selmani & President
Director April 2, 2001
- -----------------------
Denis N. Beaudry
/s/ Pierre Alary Director March 29, 2001
- -----------------------
Pierre Alary
/s/ Jean-Yves Bourgeois Director April 2, 2001
- -----------------------
Jean-Yves Bourgeois
/s/ Pierre Ranger Director March 29, 2001
- -----------------------
Pierre Ranger
/s/ Anthony Casola
- ----------------------- Chief Financial Officer, April 2, 2001
Anthony Casola Principal Financial Officer,
Principal Accounting Officer &
Secretary
II-6