<PAGE>
As filed with the Securities and Exchange Commission on May 31, 2000
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
------------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------
VISIBLE GENETICS INC.
(Exact name of registrant as specified in its charter)
Ontario, Canada 98-0194462
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
700 Bay Street, Suite 1000
Toronto, Ontario, Canada
M5G 1Z6
(416) 813-3240
(Address and Telephone Number of Principal Executive Offices)
2000 EMPLOYEE SHARE OPTION PLAN
(Full title of the plan)
Baer Marks & Upham LLP
805 Third Avenue
New York, New York 10022
Attn: Steven S. Pretsfelder, Esq.
(Name and address of agent for service)
(212) 702-5700
(Telephone number, including area code, of agent for service)
Pursuant to Rule 429, the Form F-3 reoffer prospectus, filed as part of
this Registration Statement, amends Form S-8, Registration Nos. 333-6454,
333-8804 and 333-11434 earlier filed with the Securities and Exchange Commission
on February 13, 1997, May 21, 1998 and January 14, 2000 respectively.
CALCULATION OF REGISTRATION FEE(1)
<TABLE>
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------------------------------ ------------ -------------- ----------------- ------------
PROPOSED PROPOSED
MAXIMUM MAXIMUM
OFFERING AGGREGATE AMOUNT OF
TITLE OF SECURITIES TO BE AMOUNT TO BE PRICE PER OFFERING PRICE REGISTRATION
REGISTERED REGISTERED(2) SHARE (3) (3) FEE
------------------------------ ------------ -------------- ----------------- ------------
<S> <C> <C> <C> <C>
COMMON SHARES, NO PAR VALUE 1,000,000 $28.125 $28,125,000 $7,425
PER SHARE SHARES
------------------------------ ------------ -------------- ----------------- ------------
</TABLE>
(1) A Form S-8 Registration Statement was filed with the Securities and Exchange
Commission on February 13, 1997, Registration No. 333-6454, in which 1,660,901
common shares, no par value, including 450,000 common shares issuable under the
1996 Employee Share Option Plan and 250,000 common shares issuable under the
1997 Director Option Plan, both covered by that Registration Statement, were
registered for a fee of $3,963.51.
A Form S-8 Registration Statement was filed with the Securities and Exchange
Commission on May 21, 1998, Registration No. 333-8804, in which 600,000 common
shares, no par value, issuable under the 1996 Employee Share Option Plan covered
by that Registration Statement, were registered for a fee of $1,626.19
A Form S-8 Registration Statement was filed with the Securities and Exchange
Commission on January 14, 2000, Registration No. 333-11434, in which 1,565,000
common shares, no par value, including 1,350,000 common shares issuable under
the 1996 Employee Share Option Plan and 215,000 common shares issuable under the
1997 Director Option Plan, both covered by that Registration Statement, were
registered for a fee of $17,714.24.
(2) Pursuant to Rule 416, this Registration Statement also covers such
additional securities as may become issuable to prevent dilution resulting from
stock splits, stock dividends and similar events.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h) and (c) based on the average of the high/bid and
low/asked price of the Company's common shares as reported by the Nasdaq
National Market on May 25, 2000.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) REOFFER PROSPECTUS
Pursuant to Rule 428(b)(1) under the Securities Act of 1933, the documents
containing the information specified in Part I of Form S-8 will be sent or given
to each participant in our company's 2000 Employee Share Option Plan, sometimes
referred to as the Plan, regarding the common shares issued and issuable
pursuant to the Plan. These documents and the documents incorporated by
reference in this Registration Statement pursuant to Item 3 of Part II hereof,
taken together, constitute the Section 10(a) reoffer prospectus.
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<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
In addition to the documents incorporated herein by reference from the
Registration Statements on Form S-8 (File Nos. 333-6454, 333-8804 and
333-11434), as previously filed with the Securities and Exchange Commission, the
following documents are incorporated by reference in this Registration
Statement:
(a) our Annual Report on Form 20-F for the fiscal year ended December 31,
1999, as amended by Form 20-F/A-1, which we refer to in this Registration
Statement as our Annual Report on Form 20-F;
(b) our Report on Form 6-K Filing No. 1 for the Month of January, 2000;
(c) our Report on Form 6-K Filing No. 2 for the Month of January, 2000;
(d) our Report on Form 6-K Filing No. 1 for the Month of February, 2000;
(e) our Report on Form 6-K Filing No. 1 for the Month of April, 2000;
(f) our Report on Form 6-K Filing No. 2 for the Month of April, 2000;
(g) our Report on Form 6-K Filing No. 2/A-1 for the Month of April, 2000;
(h) our Report on Form 6-K Filing No. 3 for the Month of April, 2000;
and
(i) our Report on Form 6-K Filing No. 1 for the Month of May, 2000.
In addition, all documents which we file with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act
after the date of this Registration Statement and before termination of the
offering, including all annual reports on Form 20-F or Form 10-K, and all
filings on Forms 10-Q and 8-K, will be deemed to be incorporated by reference in
this Registration Statement and to be a part of this Registration Statement from
the date those documents are filed. We may also incorporate in this Registration
Statement any Form 6-K which we file with the Securities and Exchange Commission
by identifying in such form that it is being incorporated by reference into this
Registration Statement. Any statement contained in a document which is
incorporated, or deemed to be incorporated, by reference into this Registration
Statement, shall be considered modified or superseded for purposes of this
Registration Statement to the extent that a statement contained in this
Registration Statement or in any other subsequently filed document which also
is, or is deemed to be, incorporated by reference herein modifies or supersedes
such statement. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 136 of the Ontario Business Corporations Act and Section 7 of our
company's by-laws Nos. 1 and 3 provide for the indemnification of directors and
officers of our company. Under these provisions, we will indemnify a director or
officer of our company (or a former director or officer) against all costs,
charges and expenses, including amounts paid to settle an action or satisfy a
judgment,
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<PAGE>
reasonably incurred by the director or officer in respect of any civil, criminal
or administrative action or proceeding (other than in respect of an action by or
on behalf of our company to procure a judgment in its favor) to which the
director or officer (or a former director or officer) is made a party by reason
of his position with our company, provided the director or officer: (a) acted
honestly and in good faith with a view to the best interests of our company and
(b) in the case of a criminal or administrative action or proceeding that is
enforced by a monetary penalty, had reasonable grounds for believing that his
conduct was lawful. In respect of an action by or on behalf of our company to
procure a judgment in our favor, we, with the approval of a court, may indemnify
a director or officer of our company (or a former director or officer) against
all costs, charges and expenses reasonably incurred by him in connection with
such action if he fulfills the conditions set out in clauses (a) and (b) of the
previous sentence. Notwithstanding the foregoing, a director or officer of our
company (or a former director or officer) is entitled to indemnification from us
with respect to all costs, charges and expenses reasonably incurred by him in
connection with the defense of any civil, criminal or administrative action or
proceeding to which he is made a party by reason of his position with our
company if he was substantially successful on the merits in his defense of the
action or proceeding and he fulfills the conditions in clauses (a) and (b) of
the second sentence of this paragraph.
Our company also has a policy insuring it and its directors and officers
against certain liabilities and has entered into indemnification agreements with
each of our directors and officers.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
<S> <C>
4.1 Certificate of Designations, Number, Voting Powers,
Preference and Rights of Series A Convertible Preferred
Shares.(1)
5.1* Opinion of Osler, Hoskin & Harcourt LLP as to the legality
of the securities being registered hereby.
23.1* Consent of PricewaterhouseCoopers LLP, Chartered
Accountants in Canada.
23.2* Consent of Osler, Hoskin & Harcourt LLP (included in
Exhibit 5.1).
23.3* Consent of Baer Marks & Upham LLP.
24* Power of Attorney (included on the executed signature
page of this Registration Statement).
</TABLE>
----------------
*Filed herewith.
(1) Incorporated by reference from Exhibit 4.2 to the Company's Registration
Statement on Form F-3, File No. 333-91155 filed with the Securities and Exchange
Commission on November 17, 1999.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement to include any material
information with respect to the plan of distribution not previously disclosed in
the registration statement or any material change to such information in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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.
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<PAGE>
(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
this offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is therefore unenforceable. In the event that a claim for indemnification
against such liabilities (other that the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the 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 Act and will be governed by the final adjudication of
such issue.
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<PAGE>
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 Toronto, Province of Ontario, Canada, on the 31st day
of May 2000.
VISIBLE GENETICS INC.
By: /s/ RICHARD T. DALY
---------------------------------------
Richard T. Daly
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Richard T. Daly and Thomas J. Clarke or any of
them, as his true and lawful attorney-in-fact and agents, with full powers of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement 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, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite or necessary to be done, as fully to all intents
and purposes as he might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents or any of them, may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ RICHARD T. DALY President and Chief May 31, 2000
------------------------------------ Executive Officer
Richard T. Daly (principal executive officer)
/s/ THOMAS J. CLARKE Chief Financial Officer May 31, 2000
------------------------------------ (principal financial officer)
Thomas J. Clarke
/s/ MICHAEL A. CARDIFF Director May 31, 2000
-----------------------------------
Michael A. Cardiff
/s/ SHELDON INWENTASH Director May 31, 2000
-----------------------------------
Sheldon Inwentash
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/s/ J. SPENCER LANTHIER Director May 31, 2000
-----------------------------------
J. Spencer Lanthier
/s/ JACQUES R. LAPOINTE Director May 31, 2000
-----------------------------------
Jacques R. Lapointe
/s/ JONATHAN S. LEFF Director May 31, 2000
------------------------------------
Jonathan S. Leff
/s/ DR. J. ROBERT S. PRICHARD Director May 31, 2000
------------------------------------
Dr. J. Robert S. Prichard
/s/ DR. LLOYD M. SMITH Director May 31, 2000
------------------------------------
Dr. Lloyd M. Smith
</TABLE>
Authorized Representative in the United States:
BAER MARKS & UPHAM LLP
By: /s/ STEVEN S. PRETSFELDER May 31, 2000
--------------------------
Steven S. Pretsfelder
II-5
<PAGE>
EXPLANATORY NOTE
The reoffer prospectus which is filed as a part of this Registration
Statement has been prepared in accordance with the requirements of Part I of
Form F-3 and may be used for reoffers or resales of the common shares of our
company acquired by the persons named therein pursuant to each of the Plans.
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REOFFER PROSPECTUS
VISIBLE GENETICS INC.
1,000,000 Common Shares under the
2000 Employee Share Option Plan
2,400,000 Common Shares under the
1996 Employee Share Option Plan
885,901 Common Shares under the
Employee Pool Option Plan
465,000 Common Shares under the
1997 Director Option Plan
This reoffer prospectus is being used in connection with the offering by
certain selling shareholders of Visible Genetics Inc., of common shares of
Visible Genetics Inc., that may be acquired by them under our 2000 Employee
Share Option Plan, our 1996 Employee Share Option Plan, our Employee Pool Option
Plan and our 1997 Director Option Plan.
The selling shareholders may sell their common shares from time to time,
in one or more transactions, at market prices or at negotiated prices in private
transactions.
We will not receive any of the proceeds from the sales of the common
shares.
The common shares of our company are listed on the Nasdaq National Market
under the symbol "VGIN." The last reported sale price of the common shares on
the Nasdaq National Market on May 30, 2000 was $27.25 per share.
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 reoffer prospectus. Any representation to the
contrary is a criminal offense.
THE DATE OF THIS REOFFER PROSPECTUS IS MAY __, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE COMPANy..................................................................1
FORWARD-LOOKING STATEMENTS...................................................2
USE OF PROCEEDS..............................................................4
DIVIDEND POLICY..............................................................4
SELECTED CONSOLIDATED FINANCIAL DATA.........................................5
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS..........................................................6
INFORMATION ABOUT OUR COMPANY................................................8
SELLING SHAREHOLDERS.........................................................9
PLAN OF DISTRIBUTION........................................................11
LEGAL MATTERS...............................................................12
EXPERTS.....................................................................12
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.............................12
WHERE YOU CAN FIND MORE INFORMATION.........................................13
</TABLE>
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THE COMPANY
We develop, manufacture and sell integrated DNA sequencing systems that
analyze genetic information to improve the treatment of selected diseases. Our
strategy is to become a leader in the emerging field of pharmacogenomics.
Pharmacogenomics is the science of individualizing therapy based on genetic
differences across patients. Our genotyping technology, which employs DNA
sequencing, enables the analysis in the clinical diagnostic laboratory of
individual genetic variations. Genotyping is the act of selecting and reading
certain components of the sequence of a specific strand of DNA in order to
understand how mutations in the DNA may influence the onset and treatment of
some diseases and medical conditions. DNA sequencing is generally considered the
most thorough and accurate method for genotyping diseases. We believe that
individualizing therapy through pharmacogenomics will improve the treatment of
many diseases, such as Human Immunodeficiency Virus, or HIV, hepatitis B,
hepatitis C, tuberculosis and eventually some cancers.
Our OpenGene System consists of automated DNA sequencers, disposable gel
cassettes, related equipment and software and disease-specific GeneKits. Our
GeneKits contain the necessary chemicals, reagents, third-party licenses and
other consumables and materials required for sequencing specific
disease-associated genes. We have developed GeneKits for HIV and HLA (used for
tissue typing, for example, in organ transplants). We are developing GeneKits
for hepatitis B, hepatitis C and tuberculosis. We began selling our DNA
sequencers and related equipment and consumables to the research and clinical
research markets in the third quarter of 1996 and began selling GeneKits into
the same markets in the third quarter of 1997.
The first clinical diagnostic application we are targeting is HIV. We have
developed our HIV genekit to enable clinicians to genotype the major HIV species
infecting patients in order to improve the management of patient treatment. HIV
is a highly variable virus with high rates of mutations, which may lead to drug
resistance. One of the central challenges in maintaining HIV patients on
long-term drug therapy is to adjust each patient's medication as drug-resistant
strains of the virus emerge.
Two initial clinical trials, including one that we conducted, have shown
that patients whose drug therapy is managed using HIV genotyping had greater
reductions in viral load than HIV patients who were not genotyped. In June 1999,
we completed a European trial, which we call VIRADAPT, which showed, among other
things, that after six months patients who received standard of care treatment
and underwent periodic genotyping had a mean decrease in viral load of
approximately 93% as compared to a mean decrease in viral load of approximately
79% in the non-genotyping group. In addition, after 6 months, 32% of the
patients in the genotyping group had undetectable viral loads as compared to 14%
of patients in the non-genotyping group. The other trial, called GART, was
funded by the National Institutes of Health, or NIH, and was completed in the
United States in December 1998. It showed that, at the end of 8 weeks, patients
who received standard of care treatment and underwent periodic genotyping had a
mean decrease in viral load of approximately 93%, as compared to 76% to patients
in the non-genotyping group.
Also in June 1999, we initiated a trial called SEARCH to test the clinical
utility of our HIV OpenGene System in genotyping HIV infected patients. Based on
the results from the VIRADAPT and GART clinical trials, the FDA has advised us
that we are not required to complete the SEARCH trial and has indicated that we
will not be required to demonstrate further the clinical utility of our HIV
OpenGene System in the treatment of HIV infected individuals. We plan to apply
to the FDA during 2000 for approval to sell our HIV OpenGene System to the
clinical diagnostic market.
Our principal executive offices are located at 700 Bay Street, Suite 1000,
Toronto, Ontario, Canada M5G 1Z6. Our telephone number is (416) 813-3240.
<PAGE>
FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements. You can identify
these forward-looking statements when you see us using words such as "expect,"
"anticipate," "estimate," "believe," "intend," "may," "predict," and other
similar expressions. These forward looking statements cover, among other items:
o FDA and other regulatory approval for certain of our products;
o acceptance of our products in the clinical diagnostic market;
o acceptance of genotyping in the clinical diagnostic market;
o our marketing and sales plans;
o our expectations about the markets for our products;
o the performance of our products;
o our intention to introduce new products;
o our future capital needs;
o our clinical trials;
o reimbursement of our products by insurance companies and other
third-party payors;
o our ability to compete in the research, clinical research and
clinical diagnostic markets;
o our patent applications;
o our ability to bring our Atlanta manufacturing facility fully
operational; and
o our ability to modify our information systems to accommodate euro
transactions.
We have based these forward-looking statements largely on our current
expectations. However, forward-looking statements are subject to a number of
risks and uncertainties, certain of which are beyond our control. Actual results
could differ materially from those anticipated as a result of the factors
described under "Risk Factors," found in our Annual Report on Form 20-F and
incorporated into this reoffer prospectus by reference, including, among others:
o delays in obtaining, or our inability to obtain, approval by the FDA
and other regulatory authorities for our HIV OpenGene System and, in
the future, certain of our other products for the clinical diagnostic
market;
o refusal of insurance companies and other third-party payors to
reimburse patients and clinicians for our products;
o uncertainty of acceptance of genotyping, in general, and of our
products, in particular, in the clinical diagnostic market;
o problems, delays and expenses we may face with our proposed clinical
trials;
o problems that we may face in manufacturing, marketing and
distributing our products;
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o delays in the issuance of, or the failure to obtain, patents or
licenses for certain of our products and technologies;
o problems with important suppliers and business partners;
o delays in developing, or the failure to develop, new products and
enhanced versions of existing products; and
o the timing of our future capital needs or our inability to raise
additional capital when needed.
We do not undertake any obligation to publicly update or revise any
forward-looking statements contained in this reoffer prospectus or incorporated
by reference, whether as a result of new information, future events or
otherwise. Because of these risks and uncertainties, the forward-looking
statements and circumstances discussed in this prospectus might not transpire.
3
<PAGE>
USE OF PROCEEDS
All of the common shares offered by this reoffer prospectus are being
offered by the selling shareholders. We will not receive any proceeds from sales
of common shares by the selling shareholders.
DIVIDEND POLICY
SERIES A PREFERRED SHARES. Dividends on our Series A preferred shares
accrue at the rate of 9% per year during the first three years after issuance,
and 4% per year thereafter. Dividends may not be paid for the first three years.
After three years, at our option, we may pay dividends in cash. If dividends are
not paid in cash, they will continue to accrue.
COMMON SHARES. We have not declared or paid any cash dividends on our
common shares. We currently intend to retain any future earnings for use in the
operation and expansion of our business. We do not anticipate paying any cash
dividends on our common shares in the foreseeable future.
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SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data set forth below should
be read in conjunction with "Management's Discussion and Analysis of Financial
Condition and Results of Operations." The Consolidated Statement of Operations
data for the three-month period ended March 31, 2000 and 1999 and the
Consolidated Balance Sheet data as of March 31, 2000 are derived from unaudited
consolidated financial statements included in our Report on Form 6-K, dated May
11, 2000, incorporated into this reoffer prospectus by reference, which in the
opinion of our management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the financial data for such
period. Historical results are not necessarily indicative of results to be
expected for any future period.
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
(in thousands, except per share data)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
----------------------------
STATEMENT OF OPERATIONS 2000 1999
---- ----
(unaudited)
<S> <C> <C>
Sales ....................................... $ 3,644 $ 3,261
Cost of sales ............................... 2,284 2,151
-------- --------
Gross margin ................................ 1,360 1,110
Sales, general and administrative
expense .................................... 5,418 3,163
Research and development expense............. 2,083 1,854
-------- --------
Loss from operations before interest......... (6,141) (3,907)
Interest income ............................ 430 113
Interest and financing expense.............. (5) (540)
-------- --------
Net loss .................................... (5,716) (4,334)
Cumulative preferred dividends and
accretion of discount attributable to
preferred shares ........................... (967) --
-------- --------
Net loss attributable to common shareholders. (6,683) $ (4,334)
======== ========
Net loss per common share ................... $ (0.55) $ (0.46)
Weighted average number of
common shares outstanding................... 12,248 9,411
</TABLE>
<TABLE>
<CAPTION>
MARCH 31, 2000
--------------
(unaudited)
BALANCE SHEET DATA
<S> <C>
Cash and short-term investments.... $36,187
Working capital.................... 39,047
Total assets....................... 54,834
Mandatorily redeemable convertible
preferred shares............... 28,523
Accumulated deficit................ (65,154)
Shareholders' equity............... 19,577
</TABLE>
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
COMPARISON OF THREE MONTHS ENDED MARCH 31, 2000 TO THREE MONTHS ENDED
MARCH 31, 1999
SALES. Sales increased 12% to $3.6 million for the three months ended
March 31, 2000, compared with $3.3 million for the same period of the prior
year. This increase resulted primarily from increased sales of our HIV GeneKit.
In the three months ended March 31, 2000, automated DNA sequencing systems
accounted for 51% of total sales, compared to approximately 73% of total sales
in the same period of the prior year. GeneKits and other consumables accounted
for 44% of total sales, compared to approximately 21% of total sales in the same
period of the prior year. Testing services accounted for 5% of total sales,
compared to 6% of total sales in the same period of the prior year. It is
expected that sales of GeneKits and other consumables will continue to grow as a
percentage of total sales. Sales in North America, Europe, and Asia and South
America were $1.6 million, $1.2 million and $0.8 million, respectively, during
the three months ended March 31, 2000, as compared to $1.5 million, $1.0 million
and $0.8 million, respectively, during the three months ended March 31, 1999.
During the three months ended March 31, 2000, one customer accounted for
approximately 21% of sales, of which 20% comprised DNA sequencing systems and 1%
comprised GeneKits and other consumables. During the three months ended March
31, 1999, one customer accounted for 11% of sales, of which 9% comprised DNA
sequencing systems and 2% comprised GeneKits and other consumables. The sales to
this customer were made on the same general terms and conditions as the majority
of other sales during the respective periods.
COST OF SALES. Cost of sales increased to $2.3 million for the three
months ended March 31, 2000, from $2.2 million in the same period of the prior
year. In the three months ended March 31, 2000, cost of sales aggregated 63% of
sales, compared to 66% of sales in the same period of the prior year. The
decrease in cost of sales as a percentage of sales was primarily related to the
increase in sales of GeneKits. GeneKit sales have a higher gross margin and
lower cost of sales, than sales of DNA sequencing systems and testing services.
SALES, GENERAL AND ADMINISTRATIVE EXPENSES. Sales, general and
administrative expenses increased 71% to $5.4 million for the three months ended
March 31, 2000, compared with $3.2 million for the same period of the prior
year. This increase resulted primarily from increased payroll and personnel
costs due to the continued growth of our business and the continued expansion of
our sales force in North America and Europe. Sales and marketing expenses
included in sales, general and administrative expenses increased 60% to $3.0
million for the three months ended March 31, 2000, compared with $1.9 million
for the same period of the prior year.
RESEARCH AND DEVELOPMENT EXPENSES. Research and development expenses
increased 12% to $2.1 million for the three months ended March 31, 2000,
compared with $1.9 million for the same period of the prior year. This increase
resulted from increased payroll and personnel costs, along with increased
purchases of laboratory supplies, as we developed additional GeneKits and
continued our research programs. Additionally, we incurred costs related to our
planned FDA submission for our HIV OpenGene System.
INTEREST INCOME. Interest income was $0.4 million for the three months
ended March 31, 2000, compared with $0.1 million for the same period of the
prior year. This increase reflects higher cash balances as a result of the cash
proceeds received from the July 1999 issuance of the Series A mandatorily
redeemable convertible preferred shares and the December 1999 private placement
of 1,916,000 common shares.
INTEREST AND FINANCING EXPENSE. Interest and financing expense decreased
to approximately nil for the three months ended March 31, 2000, compared with
$0.5 million for the same period of the prior
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year. The decrease is due to the repayment in July 1999, concurrent with the
issuance of the Series A mandatorily redeemable convertible preferred shares, of
all of the company's outstanding debt.
CUMULATIVE PREFERRED DIVIDENDS AND ACCRETION OF DISCOUNT ATTRIBUTABLE TO
PREFERRED SHARES. The increase in cumulative preferred dividends and accretion
of discount attributable to preferred shares to $1.0 million for the three
months ended March 31, 2000 from nil for the same period of the prior year,
reflects dividends and amortization of discount on the Series A mandatorily
redeemable convertible preferred shares issued in July 1999.
FINANCIAL POSITION
At March 31, 2000, we had $36.2 million in cash and short-term
investments, and $39.0 million in working capital.
In April 2000, we completed an underwritten public offering of
2,090,000 common shares. After underwriting discounts, but before related fees
and expenses, we received proceeds of $75.4 million.
For a further discussion on our financial position and our future needs
for financing, see the section entitled "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Liquidity and Capital
Resources" of our Annual Report on Form 20-F, incorporated into this reoffer
prospectus by reference.
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INFORMATION ABOUT OUR COMPANY
For a detailed description of our business and information about our
management, see our Annual Report on Form 20-F which is incorporated into this
reoffer prospectus by reference. The following information supplements or
supercedes, as appropriate, the information contained in our Annual Report on
Form 20-F.
SERVICE AND ENFORCEMENT OF LEGAL PROCESS
Our company is incorporated under the laws of the Province of Ontario,
Canada and a substantial portion of our assets are located in Canada. Certain of
our directors and officers and certain of the experts named in this reoffer
prospectus are residents of Canada, and all or a substantial portion of their
assets are located outside the United States. As a result, if any of our
shareholders were to bring a lawsuit against our officers, directors or experts
in the United States it may be difficult for them to effect service of legal
process within the United States upon those people who are not residents of the
United States or to realize in the United States upon judgments of courts of the
United States based upon civil liability under the Securities Act of 1933, as
amended, or the Securities Exchange Act of 1934, as amended (including the rules
promulgated thereunder by the Commission). In addition, our attorneys in Canada,
Osler, Hoskin & Harcourt LLP, have advised us that there is doubt as to the
enforceability in Canada against our company, our directors and officers, or the
experts named in this reoffer prospectus, in each case if not a resident of the
United States, of liabilities predicated solely upon U.S. federal securities
laws.
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SELLING SHAREHOLDERS
The common shares to which this reoffer prospectus relates are being
registered for reoffers and resales by selling shareholders of our company who
may acquire such shares under the Plans. The selling shareholders named below
may resell all, a portion, or none of such shares. There is no assurance that
any of the selling shareholders will sell any or all of the common shares that
they are offering under this reoffer prospectus.
Participants under the Plans who are deemed to be "affiliates" of the
company who acquire common shares under the Plans may be added to the selling
shareholders listed below from time to time by use of a reoffer prospectus
supplement filed pursuant to Rule 424(b) under the Securities Act.
The following table sets forth certain information concerning the selling
shareholders as of the date of this reoffer prospectus:
<TABLE>
<CAPTION>
Number of
Common Percentage of
Number Shares Which Number Common Shares
of May be of Plan Beneficially
Common Acquired Shares Owned(3)(4)
Shares Under the to be Before After
Name Owned(1) Plans(2) Sold* Offering Offering*
-------------------------- ---------- -------------- --------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Richard T. Daly(5) 10,000 480,000 480,000 3.2% * *
Thomas J. Clarke(6) -- 40,000 40,000 * * --
Timothy W. Ellis(7) -- 100,000 100,000 * * --
Dr. Arthur W.G. Cole(8) -- 134,620 134,620 * * --
Dr. James M. Dunn(9) 44,191 44,616 44,616 * * * *
Marguerite Ethier(10) -- 25,000 25,000 * * --
Dr. Richard J. Carroll(11) -- 25,000 25,000 * * --
David Gibbons(12) -- 14,000 14,000 * * --
Robert J. Griffin(13) -- 30,000 30,000 * * --
Robert Lloyd(14) 50,000 -- -- * * * *
Steven Owings(15) -- 20,000 20,000 * * --
Deborah Rasmussen(16) -- 10,000 10,000 * * --
William C. Sullivan(17) -- 20,000 20,000 * * --
Dr. Dean L. Winslow(18) -- 40,000 40,000 * * --
Michael A. Cardiff(19) -- 15,000 15,000 * * --
Sheldon Inwentash(20) -- 30,000 30,000 * * --
J. Spencer Lanthier(21) -- 15,000 15,000 ** --
Jacques R. Lapointe(22) -- 15,000 15,000 ** --
Jonathan Leff(23) -- -- -- -- --
Dr. J. Robert S. -- 30,000 30,000 * * --
Prichard(24)
Dr. Lloyd M. Smith(25) -- 81,540 81,540 * * --
Dr. Konrad Weis(26) -- 15,000 15,000 * * --
</TABLE>
-----------------
* Does not constitute a commitment to sell any or all of the stated number of
common shares. The number of shares offered shall be determined from time to
time by each selling shareholder at his sole discretion.
** Represents less than 1%.
(1) Represents shares owned beneficially by the named individual other than
those shares which may be acquired under the Plan. Unless otherwise noted,
all persons referred to above have sole voting and sole investment power.
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<PAGE>
(2) Includes all shares which the named individual has the right to acquire
under all vested and unvested options and warrants granted to such
individual under the Plans prior to the date of this reoffer prospectus.
(3) Based on 15,027,288 common shares outstanding as of April 30, 2000.
(4) Does not give effect to any currently outstanding warrants or options,
other than with respect to those set forth for the individual persons
listed in the above table, pursuant to Rule 13d-3 under the Exchange Act.
(5) Mr. Daly is President, Chief Executive Officer and a Director of our
company.
(6) Mr. Clarke is Chief Financial Officer of our company.
(7) Mr. Ellis is Chief Operating Officer of our company.
(8) Dr. Cole is an Executive Vice President of our company and President,
Visible Genetics Europe, S.A., a subsidiary of our company.
(9) Dr. Dunn is Vice President, Technology of our company.
(10) Ms. Ethier is Vice President, General Counsel of our company.
(11) Dr. Carroll is Vice President, Business Development of our company.
(12) Mr. Gibbons is Vice President, Product and Technical Support of our
company.
(13) Mr. Griffin is Vice President, Manufacturing of our company.
(14) Mr. Lloyd is Vice President, Diagnostic Services of our company.
(15) Mr. Owings is Vice President, Sales and Marketing of our company.
(16) Ms. Rasmussen is Vice President, Corporate Quality Assurance of our
company.
(17) Mr. Sullivan is Vice President, Diagnostic Manufacturing of our company.
(18) Dr. Winslow is Vice President, Regulatory and Clinical Affairs of our
company.
(19) Mr. Cardiff is a Director of our company.
(20) Mr. Inwentash is a Director of the Company. The number of common shares
which he owns excludes 1,927,134 common shares owned by GeneVest Inc.
("GeneVest"), with respect to which Mr. Inwentash disclaims beneficial
ownership. Mr. Inwentash is the President and Chief Executive Officer of
GeneVest and together with his affiliates, beneficially owns 45% of its
issued and outstanding common shares.
(21) Mr. Lanthier is a Director of our company.
(22) Mr. Lapointe is a Director of our company.
(23) Mr. Leff is a Director of our company. The number of common shares which
he owns excludes 27,752 common shares and 2,921,591 common shares issuable
upon conversion, as of April 30, 2000, of Series A preferred shares owned
by certain affiliated funds managed by E.M. Warburg, Pincus & Co., LLC.
Mr. Leff, who is a Managing Director at E.M. Warburg, Pincus & Co.,
disclaims beneficial ownership of those shares.
(24) Dr. Prichard is a Director of our company.
(25) Dr. Smith is a Director of our company.
(26) Dr. Weis is a Director of our company.
10
<PAGE>
PLAN OF DISTRIBUTION
The common shares may be sold from time to time by the selling
shareholders in one or more transactions at fixed prices, at market prices at
the time of sale, at varying prices determined at the time of sale or at
negotiated prices. The selling shareholders may offer their common shares in one
or more of the following transactions:
o on any national securities exchange or quotation service on which
the common shares may be listed or quoted at the time of sale,
including the Nasdaq National Market;
o in the over-the-counter market;
o in private transactions;
o through options;
o by pledge to secure debts and other obligations;
o or a combination of any of the above transactions.
The common shares described in this reoffer prospectus may be sold from
time to time directly by the selling shareholders. Alternatively, the selling
shareholders may from time to time offer common shares to or through
underwriters, broker/dealers or agents. The selling shareholders and any
underwriters, broker/dealers or agents that participate in the distribution of
the common shares may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933. Any profits on the resale of common shares and any
compensation received by any underwriter, broker/dealer or agent may be deemed
to be underwriting discounts and commissions under the Securities Act of 1933.
Any shares covered by this reoffer prospectus which qualify for sale
pursuant to Rule 144 under the Securities Act of 1933 may be sold under Rule 144
rather than pursuant to this reoffer prospectus. The selling shareholders may
not be able to sell all of their shares under Rule 144. The selling shareholders
may transfer, devise or gift such shares by other means not described in this
reoffer prospectus.
To comply with the securities laws of certain jurisdictions, the common
shares must be offered or sold only through registered or licensed brokers or
dealers. In addition, in certain jurisdictions, the common shares may not be
offered or sold unless they have been registered or qualified for sale or an
exemption is available and complied with.
The anti-manipulation provisions of Rules 101 through 104 under Regulation
M of the Securities Exchange Act of 1934 may apply to purchases and sales of
common shares by the selling shareholders. In addition, there are restrictions
on market-making activities by persons engaged in the distribution of the common
shares.
We have agreed to pay all of the expenses relating to the registration,
offering and sale of the common shares by the selling shareholders to the
public, other than commissions or discounts of underwriters, broker-dealers or
agents.
11
<PAGE>
LEGAL MATTERS
The validity of the common shares being offered hereby has been passed
upon for us by our attorneys, Olser, Hoskin & Harcourt LLP, Toronto, Ontario.
Certain matters relating to this offering with respect to United States
securities laws will be passed upon by our attorneys, Baer Marks & Upham LLP,
New York, New York.
EXPERTS
Our Consolidated Financial Statements as at December 31, 1998 and 1999 and
for the years ended December 31, 1997, 1998 and 1999, incorporated by reference
in this reoffer prospectus, have been audited by PricewaterhouseCoopers LLP,
Chartered Accountants in Canada, as stated in their report. The Consolidated
Financial Statements have been incorporated herein by reference in reliance upon
such report, given upon the authority of the firm as experts in auditing and
accounting.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
In addition to the documents incorporated herein by reference from the
Registration Statements on Form S-8 (File Nos. 333-6454, 333-8804 and
333-11434), as previously filed with the Securities and Exchange Commission, the
following documents are incorporated by reference in this reoffer prospectus:
(a) our Annual Report on Form 20-F for the fiscal year ended December 31,
1999, as amended by Form 20-F/A-1, which we refer to in this reoffer prospectus
as our Annual Report on Form 20-F;
(b) our Report on Form 6-K Filing No. 1 for the Month of January, 2000;
(c) our Report on Form 6-K Filing No. 2 for the Month of January, 2000;
(d) our Report on Form 6-K Filing No. 1 for the Month of February, 2000;
(e) our Report on Form 6-K Filing No. 1 for the Month of April, 2000;
(f) our Report on Form 6-K Filing No. 2 for the Month of April, 2000;
(g) our Report on Form 6-K Filing No. 2/A-1 for the Month of April, 2000;
(h) our Report on Form 6-K Filing No. 3 for the Month of April, 2000; and
(i) our Report on Form 6-K Filing No. 1 for the Month of May, 2000.
In addition, all documents which we file with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act
after the date of the this reoffer prospectus and before termination of the
offering, including all annual reports on Form 20-F or Form 10-K, and all
filings on Forms 10-Q and 8-K, will be deemed to be incorporated by reference in
this reoffer prospectus and to be a part of this reoffer prospectus from the
date those documents are filed. We may also incorporate in this reoffer
prospectus any Form 6-K which we file with the Securities and Exchange
Commission by identifying in such form that it is being incorporated by
reference into this reoffer prospectus. Any statement contained in a document
which is incorporated, or deemed to be incorporated, by reference into this
reoffer prospectus, shall be considered modified or superseded for purposes of
this reoffer prospectus to the extent that a statement contained in this reoffer
prospectus or in any other subsequently filed document which also is, or is
deemed to be, incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this reoffer
prospectus.
12
<PAGE>
You may request a copy of any document incorporated by reference in this
reoffer prospectus at no cost. To receive a copy, call us at (416)813-3240, or
you can write us at:
Visible Genetics Inc.
700 Bay Street
Suite 1000
Toronto, Ontario, Canada M5G 1Z6
Attention: Mr. Thomas J. Clarke
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange Commission four
Registration Statements on Form S-8 under the Securities Act with respect to the
common shares offered by this reoffer prospectus. This reoffer prospectus does
not contain all of the information set forth in the Registration Statements.
Certain items of the Registration Statements are contained in exhibits and
schedules as permitted by the rules and regulations of the Securities and
Exchange Commission. You can obtain copies of the Registration Statements from
the public reference facilities listed below. Statements made in this reoffer
prospectus as to the contents of any contract, agreement or other document
referred to are not necessarily complete. With respect to each such contract,
agreement or other document filed as an exhibit to the Registration Statements
or to our Annual Report on Form 20-F, which are incorporated by reference into
this reoffer prospectus, reference is made to the exhibit for a more complete
description of the matter involved, and each such statement shall be deemed
qualified in its entirety by such reference.
We are subject to the informational requirements of the Securities
Exchange Act of 1934 and file reports and other information with the Securities
and Exchange Commission. Reports and other information which we file with the
Securities and Exchange Commission may be inspected and copied at the public
reference facilities of the Securities and Exchange Commission at:
500 West Madison Street
Suite 1400
Chicago, Illinois 60661
7 World Trade Center
New York, New York 10048
Judiciary Plaza
450 Fifth Street, N.W.
Room 1024 Washington, D.C. 20549
You can also obtain copies of this material by mail from the Public
Reference Section of the Securities and Exchange Commission, 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. Additionally, copies of this
material may also be obtained from the Securities and Exchange Commission's
Internet site at http://www.sec.gov. The Commission's telephone number is
1-800-SEC-0330.
13
<PAGE>
INDEX TO EXHIBITS FILED WITH
FORM S-8 REGISTRATION STATEMENT
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
-------------- ----------------------
5.1 Opinion of Osler, Hoskin & Harcourt LLP as to the legality
of the securities being registered hereby.
23.1 Consent of PricewaterhouseCoopers LLP, Chartered Accountants
in Canada.
23.2 Consent of Osler, Hoskin & Harcourt LLP (included in
Exhibit 5.1).
23.3 Consent of Baer Marks & Upham LLP
24 Power of Attorney (included on the executed signature
page of this Registration Statement)
