As filed with the Securities and Exchange Commission on April 11, 2000
Registration No. 333-_____
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
AVAX TECHNOLOGIES, INC.
(Exact Name of Registrant in Its Charter)
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Delaware 13-3575874
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
4520 Main Street
Suite 930
Kansas City, MO 64111
(816) 960-1333
www.avax-tech.com
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
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JEFFREY M. JONAS, M.D.
President and Chief Executive
Officer Copy to:
4520 Main Street
Suite 930 RICHARD M. WRIGHT, JR.
Kansas City, MO 64111 Gilmore & Bell, P.C.
(816) 960-1333 2405 Grand Boulevard
(Name, address, including zip code, Suite 1100
and telephone number, including are Kansas City, Missouri 64108
code, of agent for service) (816) 221-1000
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Approximate date of proposed sale to the public: From time
to time after the effective date of this registration statement.
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If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the follow box. |_|
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: |X|
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering: |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: |_|
<PAGE>
In accordance with SEC Rule 429, the prospectus forming a part of this
registration statement will, upon the effectiveness of this registration
statement, also constitute the prospectus under our two registration statements
on Form S-3 (Registration No. 333-09349 and Registration No. 333-85923).
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------
Title of each Proposed Maximum Proposed Maximum Amount of
Class of Securities Amount Offering Price Aggregate Registration
to be Registered to be Registered Per Share(2) Offering Price(2) Fee(3)
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 7,671,102 shares(1) $10.719 $82,226,542.34 $8,042.05
- --------------------------------------------------------------------------------------------
</TABLE>
(1) In accordance with SEC Rule 429, of the 7,671,102 shares of our common
stock that are being registered, 526,560 shares are being carried forward
from our registration statement on Form S-3 (Registration No. 333-09349)
and 4,302,644 shares are being carried forward from our registration
statement on Form S-3 (Registration No. 333-85923).
(2) Estimated for the purposes of calculating the registration fee pursuant to
Rule 457(c) under the Securities Act of 1933, and based on the average of
the high and low prices of our common stock reported on the Nasdaq
SmallCap Market on April 7, 2000.
(3) The $8,042.05 registration fee relates to the 2,841,898 new shares of our
common stock being registered. The registration fee for the 526,560 shares
of our common stock being carried forward from our registration statement
on Form S-3 (Registration No. 333-09349), and the registration fee for the
4,302,644 shares of our common stock being carried forward from our
registration statement on From S-3 (Registration No. 333-85923) were both
previously paid upon filing of those earlier registration statements.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(A) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(A), may determine.
1
<PAGE>
PROSPECTUS
7,671,102 Shares
AVAX TECHNOLOGIES, INC.
Common Stock
The selling stockholders listed on pages 9 and 10 of this prospectus may
sell up to 7,671,102 shares of our common stock. At any time, without notifying
us, the selling stockholders can sell all or a portion of the common stock
offered in this prospectus. The selling stockholders can sell the common stock
to buyers directly or through underwriters, brokers, dealers or agents. The sale
price for the common stock may be either a price negotiated between the selling
stockholder and the buyer, or the prevailing market price of the common stock at
the time of the sale. Our common stock is listed for quotation on the Nasdaq
SmallCap Market under the symbol "AVXT." The last reported sale price of our
common stock on the Nasdaq SmallCap Market on April 7, 2000, was $11.438 per
share.
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Investing in our common stock involves a high degree of risk. You should
consider carefully the risk factors referred to on page 6 of this prospectus.
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Neither the Securities and Exchange Commission nor any state securities
regulator has approved or determined whether this prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.
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The date of this prospectus is April __, 2000
<PAGE>
----------------------
TABLE OF CONTENTS
----------------------
Page
----
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS....................3
PROSPECTUS SUMMARY............................................................4
RISK FACTORS..................................................................6
AVAILABLE INFORMATION.........................................................6
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE.............................6
USE OF PROCEEDS...............................................................7
SELLING STOCKHOLDERS..........................................................7
PLAN OF DISTRIBUTION.........................................................11
LEGAL COUNSEL................................................................11
EXPERTS......................................................................12
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No dealer, salesperson or other person has been authorized to give any
information or to make any representations other than those contained in this
prospectus and, if given or made, the information and representations must not
be relied upon as having been authorized by us or the selling stockholders. This
prospectus does not constitute an offer to sell or a solicitation of an offer to
buy the shares by anyone in any jurisdiction in which the offer or solicitation
is not authorized, or in which the person making the offer or solicitation is
not qualified to do so, or to any person to whom it is unlawful to make the
offer or solicitation. Neither the delivery of this prospectus nor any sale made
using this prospectus will create any implication that the information contained
in this prospectus is correct as of any time after its date.
----------
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<PAGE>
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
In this prospectus, we make statements that plan for or anticipate the
future. These forward-looking statements include statements about the future of
biotechnology products and the biopharmaceutical industry, statements about our
future business plans and strategies and other statements that are not
historical in nature. These forward-looking statements are based on our current
expectations. You will find many of these statements in the following sections:
o "Prospectus Summary" on page 4;
o "Risk Factors" on page 6; and
o "Incorporation of Certain Information by Reference" on page 6.
Forward-looking statements may be identified by words or phrases such as
"believe," "expect," "anticipate," "should," "planned," "may," "estimated" and
"potential." The Private Securities Litigation Reform Act of 1995 provides a
"safe harbor" for forward-looking statements. In order to comply with the terms
of the safe harbor, and because forward-looking statements involve future risks
and uncertainties, we have listed below a variety of factors that could cause
actual results and experience to differ materially from the anticipated results
or other expectations expressed in our forward-looking statements. These factors
might include:
o Uncertainty about whether our AC Vaccine(TM) technology can be
developed to produce safe, effective and commercially viable
products.
o Uncertainty about whether our products will successfully complete
the long, complex and expensive clinical trial and regulatory
approval process for approval of new drugs in the U. S.
o The expenses, delays, uncertainties and complications typically
encountered by development stage biopharmaceutical businesses, many
of which are beyond our control.
o Our need to expand our limited manufacturing facilities or depend on
third parties to manufacture and distribute our products.
o Our financial and development obligations and our responsibility to
meet requisite research funding levels under our license and
research agreements in order to protect our rights to our products
and technologies.
o Our difficulty or inability to obtain or defend our patents, or
operate without infringing upon the rights of others.
o Our difficulty or inability to compete with other companies,
research institutes, hospitals and universities that are developing
and producing products and technologies similar to ours.
o Our history of operating losses, our increasing cash requirements,
our need to raise more money before the end of 2001, and the
uncertainty of our future profitability.
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<PAGE>
PROSPECTUS SUMMARY
This is a summary of our business and this offering. You should read
carefully this entire prospectus and the documents to which we have referred you
before you make a decision about buying our common stock.
Our Business
We are a development stage biopharmaceutical company engaged in the
development and potential commercialization of products and technologies for the
treatment of cancer and other life-threatening diseases. In 1995, we identified
research being conducted by Dr. David Berd, an oncologist and professor at
Thomas Jefferson University in Philadelphia, and licensed the rights and the
patents related to Dr. Berd's research. Since then, we have licensed other
patents and medical technologies (products and processes) developed elsewhere,
just as we did with Dr. Berd's research. We recently initiated our own research
to supplement that being done through research agreements with several
universities. We are a typical development stage biotech company in that we are
not currently generating any revenue from our proposed products, and we have not
yet made a profit.
We are primarily focusing our efforts on the development of
immunotherapies for the treatment of cancer. The National Cancer Institute
estimates that approximately 8.4 million people living in the U.S. have a
history of cancer. Throughout the past decade, approximately 13 million new
cancer cases were diagnosed. The National Institutes of Health estimates that
the overall annual cost to the health care system of treating those patients was
approximately $107 billion. The incidence of cancer continues to increase. About
1,220,100 new cancer cases are expected to be diagnosed in 2000. Cancer is the
second leading cause of death in the U.S., exceeded only by heart disease, and
we are aware of estimates that deaths from cancer will surpass cardiovascular
mortality worldwide early in the 21st Century. Although, many different types of
drugs are used to treat a variety of cancers, no one drug has been found to be a
cure for the disease. Given the need for new effective treatments for cancer, a
drug which may effectively treat cancer could have a large market potential.
Surgery, in many cases is the first treatment performed on cancer patients, and
if a treatment following surgery were to prove broadly applicable and safe, its
market potential could be significant. In addition, such a treatment would
enable the health care system to realize significant overall cost savings due to
a reduction in the number of cases of recurrent disease requiring
hospitalization and ongoing clinical and home care.
Historically, chemotherapies have been the only accepted post-surgical
treatment for cancer. Chemotherapy is the prevention or treatment of disease by
administering chemicals or drugs. Alternatively, immunotherapy, which is a
rapidly expanding segment of cancer therapy research, is the treatment of
disease or infection by stimulating the body's immune system through a process
of immunization. When a person is immunized for a particular disease or
infection, that person is injected with portions of or all of the disease agent
itself, which stimulates the body's immune system to fight the foreign agent. In
this way, he or she builds up an immunity to the disease or infection.
Immunotherapies that are being developed to treat cancer are intended to act in
the same way.
A cancer cell, in the most simple terms, is an abnormal cell that the body
itself produces. Cancer is characterized by the uncontrolled growth and spread
of these abnormal cells, that escape from the control of the body's immune
system. Because your body itself produces these abnormal cells, your immune
system does not recognize the cancer cells as foreign, and therefore, scientists
believe, does not respond by attacking and destroying the abnormal cells. Cancer
cells that escape an immune system attack can then spread throughout the body by
a variety of means. Consequently, the cancer cells invade and destroy healthy
tissue, which can ultimately lead to a person's death if untreated.
Cancers, composed of either solid tumors or blood-borne cancerous cells,
tend to spread over time to other tissues and organs in the body. Cancer may be
diagnosed at any stage of the disease, from very early (best prognosis) to very
late (worst prognosis). When cancer is detected early and has not yet spread to
other organs and tissues, surgical removal of the tumor is often effective.
While this treatment is effective in many types of cancers, in cases in which
removal of the tumor is incomplete or in which the cancer has spread, the
patient's prognosis is poor. Moreover,
4
<PAGE>
if the cancer is not discovered until cancer cells from the primary tumor have
already entered the blood or lymphatic system and established new tumors at
distant sites, the cells and the tumors they form are difficult to treat with
current technology. Chemotherapy and radiation therapy have traditionally been
the accepted methods of treatment in these cases. Current chemotherapy and
radiation therapy are, however, rather crude treatments because they kill cells
indiscriminately, destroying normal as well as cancerous cells, which leads to
toxic side effects and thereby limits the usefulness of these therapies. Through
our agreement with Thomas Jefferson University and Dr. Berd, we are researching
and attempting to develop a safe, effective immunotherapy for the treatment of
cancer.
We were incorporated in the State of New York on January 12, 1990, under
the name Nehoc, Inc. On May 29, 1992, we changed our name to Appex Technologies,
Inc. On October 22, 1992, we merged into Walden Laboratories, Inc. ("Walden"), a
Delaware corporation, which was incorporated on September 18, 1992. On December
27, 1995, Walden sold its former leading product under development, an
over-the-counter nutritional dietary, medicinal or elixorative food supplement
or drug and related patents and intellectual property to a subsidiary of
Interneuron Pharmaceuticals, Inc. We changed our name from Walden Laboratories,
Inc., to AVAX Technologies, Inc., effective March 26, 1996.
Our principal executive office is located at 4520 Main Street, Suite 930,
Kansas City, Missouri 64111. The telephone number at that address is (816)
960-1333.
AC Vaccine(TM), M-Vax(TM) and O-Vax(TM) are three of our trademarks.
The Offering
The selling stockholders may sell their shares of common stock according
to the plan of distribution described on page 11 of this prospectus. We will not
receive any proceeds from the sale of these shares.
Risk Factors
Investing in our common stock involves a high degree of risk. Before you
make a decision about investing in our common stock, you should carefully
consider the risk factors contained in our annual report on Form 10-KSB for the
year ended December 31, 1999, which is incorporated in this prospectus by
reference, as well as the rest of the information contained in our annual
report, and our other reports filed by us with the Securities and Exchange
Commission.
5
<PAGE>
RISK FACTORS
Investing in our common stock involves a high degree of risk. Before you
make a decision about investing in our common stock, you should carefully
consider the risk factors contained in our annual report on Form 10-KSB for the
year ended December 31, 1999, which is incorporated in this prospectus by
reference, as well as the rest of the information contained in our annual
report, and our other reports filed by us with the Securities and Exchange
Commission. A copy of our Form 10-KSB, as amended, will be provided to any
person receiving a copy of this prospectus upon written or oral request to us as
set forth under the heading "Incorporation of Certain Information by Reference"
below.
AVAILABLE INFORMATION
We are a "reporting company" as that term is used in the Securities
Exchange Act of 1934. As a reporting company, we are required to file reports,
proxy statements and other information with the Securities and Exchange
Commission, including the information listed below. You may read and copy any of
the reports, proxy statements and other information that we have filed with the
Securities and Exchange Commission at the Securities and Exchange Commission's
Public Reference Room, located at 450 Fifth Street, N.W., Washington, D.C.
20549. You may get information on the operation of the Public Reference Room by
calling the Securities and Exchange Commission at 1-800-732-0330. The Securities
and Exchange Commission maintains a Web site that contains reports, proxy and
information statements, and other information regarding us and other issuers
that electronically file information with the Securities and Exchange
Commission. The address of that site is (http://www.sec.gov). Our Web site is
(www.avax-tech.com).
This prospectus constitutes a part of a registration statement on Form S-3
filed by us with the Securities and Exchange Commission under the Securities Act
of 1933. You may want to refer directly to the registration statement for more
information about us and our common stock. You may want to review a copy of any
contract or document filed as an exhibit to the registration statement. We are a
"small business issuer" as that term is defined in Rule 405 under the Securities
Act of 1933.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, all of which have been previously filed with the
Securities and Exchange Commission under the Securities Exchange Act of 1934,
are incorporated by reference into this prospectus:
1. The description of our common stock contained in our registration
statement on Form 8-A;
2. Our Annual Report on Form 10-KSB for the year ended December 31, 1999; and
3. Our report on Form 8-K, as filed with the Securities and Exchange
Commission on March 23, 2000.
All documents subsequently filed by us in compliance with Section 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 prior to the
termination of this offering are incorporated by reference into this prospectus.
We will provide without charge to each person to whom a copy of this
prospectus is delivered, upon written or oral request, a copy of any of the
information that is incorporated by reference in this prospectus (including
exhibits that are specifically incorporated by reference in that information).
Any request should be directed to: Investor Relations, AVAX Technologies, Inc.,
4520 Main Street, Suite 930, Kansas City, MO 64111, telephone (816) 960-1333.
6
<PAGE>
USE OF PROCEEDS
We will not receive any proceeds from the sale of shares by the selling
stockholders. All proceeds from the resale of those shares will go to the
selling stockholders. See "Selling Stockholders" below and "Plan of
Distribution" on page 11 of this prospectus.
We will receive proceeds from any exercise of the warrants issued in
connection with the private placement of our common stock completed on March 10,
2000, and from any exercise of warrants issued in connection with the private
placement of our Series C preferred stock. If the warrants are exercised, we
intend to use the proceeds for general working capital purposes. Proceeds, if
any, from the exercise for cash of all the warrants would be approximately
$9,929,994. We cannot predict whether any of the warrants will be exercised.
SELLING STOCKHOLDERS
In 1996 we issued an aggregate of 258,198 shares of our Series B preferred
stock in two private placement transactions. As of the date of this prospectus,
we have a continuing contractual obligation to include in the registration
statement of which this prospectus forms a part a total of 526,560 shares of our
common stock that were acquired upon the conversion of shares of our Series B
preferred stock by two related selling stockholders.
On March 1, 1999 we issued an aggregate of 101,300 shares of our Series C
preferred stock in a private placement to certain of the selling stockholders
listed below. The 101,300 shares of our Series C preferred stock are convertible
into approximately 3,116,923 shares of our common stock, which shares of common
stock are covered by this prospectus. In connection with this second private
placement, we also issued five-year warrants to purchase an aggregate of up to
approximately 623,385 shares of our common stock, which are also covered by this
prospectus. As of the date of this prospectus, no warrants have been exercised.
In connection with services rendered by Paramount Capital, Inc. in
identifying and introducing us to certain investors in the Series C preferred
stock offering, we paid to Paramount cash commissions of approximately $709,100
and issued an option to acquire approximately 187,014 shares of our common stock
at an exercise price of $3.58 per share, exercisable until March 1, 2004.
Paramount also received warrants to purchase 37,400 shares of our common stock,
of which 18,700 are exercisable at $4.00 per share and the remaining 18,700 are
exercisable at $4.50 per share. The warrants are exercisable until March 1,
2004. Paramount subsequently transferred the options and warrants to certain of
the selling stockholders. The 224,414 shares of common stock subject to the
option and the warrants held by those transferees are covered by this
prospectus.
On March 10, 2000, we issued an aggregate of 2,259,494 shares of our
common stock in a private placement to certain of the selling stockholders
listed below, which shares of common stock are covered by this prospectus. We
also issued five-year warrants to purchase an aggregate of up to 225,952
additional shares of our common stock, which are also covered by this
prospectus. As of the date of this prospectus, no warrants have been exercised.
In connection with services rendered by Gruntal & Co., L.L.C. in
identifying and introducing us to certain investors in the common stock
offering, we paid to Gruntal a cash commission of approximately $746,949 and
issued warrants to purchase 83,927 shares of our common stock at an exercise
price of $11.125 per share, exercisable until March 10, 2005. The shares of
common stock subject to those warrants are covered by this prospectus.
Previously, upon entering into our engagement letter with Gruntal dated December
6, 1999, we issued to Gruntal warrants to purchase 150,000 shares of our common
stock at an exercise price of $5.09 per share, exercisable until December 15,
2004, which shares are also covered by this prospectus.
In addition, pursuant to certain provisions of a letter agreement between
us and Paramount, dated January 29, 1999, entered into in connection with the
Series C preferred stock offering, we paid to Paramount a cash finder's fee of
approximately $140,000 in connection with the March 2000, private placement of
our common stock, due to the
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<PAGE>
participation in this financing of certain investors previously introduced to us
by Paramount. We also issued to Paramount warrants to purchase 10,787 shares of
the our common stock at an exercise price of $11.125 per share, exercisable
until March 10, 2005. Paramount subsequently transferred the warrants to certain
of the selling stockholders. The 10,787 shares of common stock subject to the
warrants held by those transferees are covered by this prospectus.
We also issued to Mr. Roberto Marziale warrants to purchase 124,045 shares
of our common stock at an exercise price of $11.125 per share, which are
exercisable until March 10, 2005, as a finder's fee in connection with the
private placement of our common stock for his services in introducing us to
certain of the selling stockholders. Mr. Marziale subsequently transferred the
warrants to his company, Sagres Group Ltd. The 124,045 shares of common stock
subject to the warrants held by Sagres Group Ltd. are covered by this
prospectus.
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<PAGE>
The following table sets forth certain information with respect to the
ownership of common stock by the selling stockholders as of April 10, 2000, and
the shares offered in this prospectus by the selling stockholders.
<TABLE>
<CAPTION>
Shares Percentage
Shares Owned Owned
Currently Amount to after after
Selling Stockholder Owned be Offered Offering Offering
- ------------------- ----- ---------- -------- --------
<S> <C> <C> <C> <C>
Afax Group Inc.(1) 98,877 98,877 0 0
Bank Julius Baer(1) 5,500 5,500 0 0
Biocapital Investments Limited
Partnership(1) 197,753 197,753 0 0
C. Blair Parners, L.P.(1) 6,188 6,188 0 0
C. Blair Partners II, L. P.(1) 43,792 43,792 0 0
C. Blair Fund, Ltd.(1) 16,020 16,020 0 0
Centenary Investments, L.P.(2) 73,844 73,844 0 0
Daniel J. Schwinn(1) 49,424 49,424 0 0
Digerati Partners, L.P.(1) 98,890 98,890 0 0
Essex Woodlands Health Ventures Fund
IV, L.P.(1), (2), (3) 1,945,029 1,945,029 0 0
Fidurhone S.A.(1) 22,000 22,000 0 0
Gesico International SA(1) 197,753 197,753 0 0
Giano Capital Limited(1) 355,956 355,956 0 0
Giano Capital US Dollars Limited(1) 187,865 187,865 0 0
Gruntal & Co., L.L.C.(4) 233,927 233,927 0 0
Hentsh Henchoz & Cie(1) 22,000 22,000 0 0
Heptagon Investments LTD(2) 36,921 36,921 0 0
Investissements 90 S.A.(2) 36,921 36,921 0 0
Scott Katzmann(5) 52,443 19,384 33,059 *
Donald R. Kendall, Jr.(2) 18,460 18,460 0 0
Keys Foundation(2) 184,614 184,614 0 0
John Knox(5) 2,286 1,036 1,250 *
Martin Kratchman(5) 69,424 5,907 63,517 *
Maidenhair Investments N.V.(1) 9,888 9,888 0 0
Maribel Limited(2) 36,921 36,921 0 0
Tim McInerney(5) 197,648 122,621 75,027 *
The Medical Fund(1) 55,000 55,000 0 0
Pequot Scout Fund, L.P.(1) 296,629 296,629 0 0
Petrus Fund, L.P.(1), (2) 868,076 837,337 30,739 *
PKB Privatbank AG, Lugano(1) 108,764 108,764 0 0
John Poppadimitropo(5) 1,036 1,036 0 0
Precept Capital(1) 110,000 110,000 0 0
Quota Fund NV(1) 108,764 108,764 0 0
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Shares Percentage
Shares Owned Owned
Currently Amount to after after
Selling Stockholder Owned be Offered Offering Offering
- ------------------- ----- ---------- -------- --------
<S> <C> <C> <C> <C>
Joseph P. Riccardo(2) 51,690 51,690 0 0
Lindsey A. Rosenwald, M.D.(6), (7) 919,981 407,489 512,492 2.2%
Wayne L. Rubin(5) 79,677 8,293 71,384 *
Sagres Group LTD.(2), (5), (8) 873,945 389,889 484,056 2.1%
Samorag AG(1) 296,629 296,629 0 0
Sextant Avax, LLC(2) 119,999 119,999 0 0
J.F. Shea & Co.(2) 221,537 221,537 0 0
David M. Steinberg(2) 2,460 2,460 0 0
The Aries Domestic Fund, L.P.(9) 225,839 175,218 50,621 *
The Aries Fund, A Cayman Island
Trust(9) 557,117 351,342 205,775 *
The 1992 Houston Partnership, L.P.(2) 49,964 36,921 13,043 *
TIS Prager(2) 64,614 64,614 0 0
--------- --------- --------- ---
TOTAL 9,212,065 7,671,102 1,540,963 6.6%
</TABLE>
- ----------
* Represents less than 1.0 %.
(1) Includes shares of common stock owned and shares of common stock issuable
upon the exercise of the warrants issued in connection with the March
2000, private placement of common stock.
(2) Includes shares of common stock issued or issuable upon conversion of the
Series C preferred stock and shares of common stock issuable upon the
exercise of the warrants issued in connection with the private placement
of the Series C preferred stock.
(3) Excludes 4,938 shares of common stock issuable upon exercise of certain
options granted to James L. Currie in his capacity as a director of our
company.
(4) Includes shares of common stock issuable upon exercise of warrants issued
to Gruntal & Co., L.L.C. for placement agent services in connection with
the private placement of common stock.
(5) Includes shares of common stock issuable upon exercise of certain options
and warrants issued to Paramount Capital, Inc. for investment banking
services in connection with the Series C Preferred Stock private
placement, that were subsequently transferred by Paramount to certain of
the selling stockholders, and upon conversion of shares of Series C
preferred stock held by those selling stockholders.
(6) Excludes 199,314 shares of common stock owned by Dr. Rosenwald's wife and
trusts in favor of his minor children, and shares of common stock owned by
The Aries Fund, A Cayman Island Trust and The Aries Domestic Fund, L.P.,
two private investment funds that are managed by a company of which Dr.
Rosenwald is President. The two Aries funds are also selling stockholders,
as listed below.
(7) Includes shares of common stock issuable upon exercise of warrants issued
to Paramount Capital, Inc. for investment banking services in connection
with the March 2000, private placement of common stock, that were
subsequently transferred by Paramount to Dr. Rosenwald.
(8) Includes shares of common stock issuable upon exercise of warrants issued
to Mr. Roberto Marziale as a finder's fee in connection with the private
placement of common stock, that were subsequently transferred by Mr.
Marziale to his company, Sagres Group Ltd.
(9) Includes shares of common stock owned and shares of common stock issuable
upon the exercise of the warrants issued in connection with the private
placement of the Series B preferred stock.
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<PAGE>
PLAN OF DISTRIBUTION
We have registered the 7,671,102 shares of our common stock offered in
this prospectus on behalf of the selling stockholders. We will pay all expenses
of this registration, other than fees and expenses, if any, of counsel or other
advisors to the selling stockholders. The selling stockholders are responsible
for paying any commissions, discounts, or other brokerage fees incurred in
connection with their sale of any of the shares.
At any time, without notifying us, the selling stockholders can sell all
or a portion of the common stock offered in this prospectus. The selling
stockholders can sell the common stock to buyers directly or through
underwriters, brokers, dealers or agents. The sale price for the common stock
will be either a price negotiated between the selling stockholder and the buyer,
or the prevailing market price of the common stock at the time of the sale. The
common stock is listed for quotation on the Nasdaq SmallCap Market under the
symbol "AVXT."
We will not receive any proceeds from the sale of shares by the selling
stockholders. Under the terms of the private placements, we have agreed to
indemnify the selling stockholders against liabilities they may incur as a
result of any untrue statement of a material fact in the registration statement,
of which this prospectus is a part, or for any omission in this prospectus or
the registration statement to state a material fact necessary in order to make
the statements made, in the light of the circumstances under which they were
made, not misleading. This indemnification includes liabilities that the selling
stockholders may incur under the Securities Act of 1933.
The selling stockholders also may resell all or a portion of the shares in
open market transactions in reliance on Rule 144 under the Securities Act of
1933, if they meet the criteria and conform to the requirements of that rule.
The selling stockholders and any broker-dealers or agents that participate
with the selling stockholders in the sale of shares may be "underwriters" within
the meaning of the Securities Act of 1933. Any commissions received by
broker-dealers or agents on the sales and any profit on the resale of shares
purchased by broker-dealers or agents may be deemed to be underwriting
commissions or discounts under the Securities Act of 1933.
Under the rules of the Securities and Exchange Commission, any person
engaged in the distribution or the resale of our common stock may not
simultaneously buy, bid for or attempt to induce any other person to buy or bid
for our common stock in the open market for a period of two business days prior
to the beginning of the distribution. The rules and regulations under the
Securities Exchange Act of 1934 may also limit the timing of purchases and sales
of shares of our common stock by the selling stockholders. We have notified the
selling stockholders they should not begin any distribution of common stock
unless they have stopped purchasing and bidding for common stock in the open
market as provided in applicable securities regulations, including, without
limitation, Regulation M.
We have informed the selling stockholders that the anti-manipulation
provisions of Regulation M promulgated under the Securities Exchange Act of 1934
may apply to the sales of their shares. We have advised the selling stockholders
of the requirement for delivery of this prospectus in connection with any sale
of the common stock.
LEGAL COUNSEL
The validity of the securities being offered pursuant to this prospectus
will be passed upon for us by Gilmore & Bell, P.C., Kansas City, Missouri, our
counsel.
11
<PAGE>
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial
statements included in our Annual Report on Form 10-KSB for the year ended
December 31, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given on their authority as experts in accounting and auditing.
12
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by us in connection with the
registration of the shares of common stock being offered for sale by the selling
stockholders. All amounts are estimates except the Securities and Exchange
Commission registration fee.
Securities and Exchange Commission registration fee $ 8,042.05
Legal fees and expenses 5,000.00
Accounting fees and expenses 3,000.00
Blue sky fees and expenses 1,000.00
Transfer agent fees and expenses 1,000.00
Miscellaneous 5,000.00
----------
Total $23,042.05
Item 15. Indemnification of Directors and Officers
Our company was organized under the laws of the State of Delaware, and
therefore we are subject to Section 145 of the General Corporation Law of the
State of Delaware. Section 145 authorizes a court to award or a corporation's
board of directors to grant indemnification to directors and officers in terms
broad enough to include indemnification under certain circumstances for
liabilities (including reimbursement for expenses incurred) arising under the
Securities Act of 1933, as amended.
Article Seven of our Certificate of Incorporation provides that we will
indemnify and advance expenses to our directors and officers to the fullest
extent permitted by Section 145. Article Nine of our Certificate of
Incorporation provides that the liability of our directors is eliminated to the
fullest extent permitted by Section 102(b)(7) of the Delaware General
Corporation Law.
Article V, Section 1 of our By-Laws provides for mandatory indemnification
of our directors to the fullest extent authorized by the Delaware General
Corporation Law. Article V, Section 2 of our By-Laws provides for prepayment of
expenses incurred by our directors to the fullest extent permitted by, and only
in compliance with, the Delaware General Corporate Law. Article V, Section 6 of
our By-Laws provides for permissive indemnification of our officers, employees
and agents if and to the extent authorized by our Board of Directors in
compliance with the Delaware General Corporation Law.
These provisions in the Certificate of Incorporation and the By-Laws do
not eliminate the directors' fiduciary duty, and in appropriate circumstances
equitable remedies such as injunctive or other forms of non-monetary relief will
remain available under Delaware law. In addition, each director will continue to
be subject to liability for breach of the director's duty of loyalty to us for
acts or omissions not in good faith or involving intentional misconduct, for
knowing violations of law, for actions leading to improper personal benefit to
the director, and for payment of dividends or approval of stock repurchases or
redemptions that are unlawful under Delaware law. The provisions also do not
affect a director's responsibilities under any other law, such as the federal
securities laws or state or federal environmental laws. In addition, we have
obtained certain liability insurance coverage for our directors and officers.
II-1
<PAGE>
Item 16. Exhibits
Exhibit No. Description
- ----------- -----------
3.1 Certificate of Incorporation.(1)
3.2 By-Laws.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2.
4.2 Form of Series 2000 Warrant. (2)
5.1 Opinion of Gilmore & Bell, P.C.*
10.1 Securities Purchase Agreement dated March 7, 2000.(2)
23.1 Consent of Gilmore & Bell, P.C. included in Exhibit 5.1.
23.2 Consent of Ernst & Young LLP, Independent Auditors.*
24.1 Power of Attorney (included on the signature page hereof).
- ----------
* Filed herewith.
(1) Incorporated by reference and previously filed as an exhibit to our
registration statement on Form SB-2 filed with the Securities and Exchange
Commission (File No. 333-09349) on July 31, 1996.
(2) Incorporated by reference and previously filed as an exhibit to our
Current Report on Form 8-K, filed with the Securities and Exchange
Commission on March 23, 2000.
II-2
<PAGE>
Item 17. Undertakings
We hereby undertake:
(1) To file, during any period in which we offer or sell securities, a
post-effective amendment to this registration statement to include any
additional or changed material information regarding the plan of distribution.
(2) That for determining liability under the Securities Act of 1933, we
will treat each post-effective amendment to this registration statement and each
filing of our annual report, as a new registration statement of the securities
offered, and the offering of the securities at that time will be deemed to be
the initial bona fide offering.
(3) To file a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the offering.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
our company pursuant to the Delaware General Corporation Law, our Certificate of
Incorporation and our By-Laws, or otherwise, we have been advised that in the
opinion of the Securities and Exchange Commission that indemnification is
against public policy as expressed in the Securities Act of 1933, and is,
therefore, unenforceable. In the event that a claim for indemnification against
liabilities arising under the Securities Act of 1933 (other than the payment by
us of expenses incurred or paid by a director, officer, or controlling person of
our company in the successful defense of any action, suit or proceeding) is
asserted by that director, officer or controlling person in connection with the
securities that we are registering, we will, unless in the opinion of our
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question of whether the indemnification by us is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of that issue.
II-3
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, as
amended, we certify that we have reasonable grounds to believe that we meet all
of the requirements for filing on Form S-3 and we have authorized this
registration statement to be signed on our behalf by the undersigned, thereunto
duly authorized, in the City of Kansas City, State of Missouri, on this April
10, 2000.
AVAX TECHNOLOGIES, INC.
By: /s/ Jeffrey M. Jonas, M. D.
---------------------------
Jeffrey M. Jonas, M.D.
Chief Executive Officer and
President
POWER OF ATTORNEY
We, the undersigned officers and directors of AVAX Technologies, Inc.,
severally constitute Jeffrey M. Jonas, M.D., or David L. Tousley, in the order
named, our true and lawful attorney-in-fact with full power to each, to sign for
us and in our names in the capacities indicated below, the registration
statement on Form S-3 filed with this registration statement and any and all
subsequent amendments to this registration statement, and generally to do all
things in our names and on our behalf in our capacities as officers and
directors to enable AVAX Technologies, Inc. to comply with all requirements of
the Securities and Exchange Commission.
In accordance with the requirements of the Securities Act of 1933, as
amended, the registration statement has been signed by the following persons in
the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Name & Title Date
--------- ------------ ----
<S> <C> <C>
/s/ Jeffrey M. Jonas, M.D. Jeffrey M. Jonas, M.D.
- -------------------------------- Chief Executive Officer, President April 10, 2000
and Director
/s/ David L. Tousley David L. Tousley
- -------------------------------- Chief Financial Officer and Secretary
(Principal Financial and Accounting April 10, 2000
Officer)
/s/ Edson D. de Castro Edson D. de Castro April 10, 2000
- -------------------------------- Director
/s/ John K. A. Prendergast, Ph.D. John K. A. Prendergast, Ph.D. April 10, 2000
- -------------------------------- Director
/s/ Carl Spana, Ph.D. Carl Spana, Ph.D. April 10, 2000
- -------------------------------- Director
/s/ Michael S. Weiss Michael S. Weiss April 10, 2000
- -------------------------------- Director
/s/ James Currie James Currie April 10, 2000
- -------------------------------- Director
</TABLE>
II-4
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------
EXHIBITS
TO
REGISTRATION STATEMENT
ON
FORM S-3
UNDER THE SECURITIES ACT OF 1933
-----------
AVAX TECHNOLOGIES, INC.
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
3.1 Certificate of Incorporation.(1)
3.2 By-Laws.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2.
4.2 Form of Series 2000 Warrant.(2)
5.1 Opinion of Gilmore & Bell, P.C.*
10.1 Securities Purchase Agreement dated March 7, 2000.(2)
23.1 Consent of Gilmore & Bell, P.C. included in Exhibit 5.1.
23.2 Consent of Ernst & Young LLP, Independent Auditors.*
24.1 Power of Attorney (included on the signature page hereof).
- ----------
* Filed herewith.
(1) Incorporated by reference and previously filed as an exhibit to our
registration statement on Form SB-2 filed with the Securities and Exchange
Commission (File No. 333-09349) on July 31, 1996.
(2) Incorporated by reference and previously filed as an exhibit to our
Current Report on Form 8-K, filed with the Securities and Exchange
Commission on March 23, 2000.
[LETTERHEAD OF GILMORE & BELL]
Exhibit 5.1
April 10, 2000
AVAX Technologies, Inc.
4520 Main Street, Suite 930
Kansas City, Missouri 64111
Re: AVAX Technologies, Inc. Registration Statement on Form S-3
Reg. No. 333- (the "Registration Statement")
Dear Sir/Madam:
You have requested our opinion as counsel to AVAX Technologies, Inc., a
Delaware corporation (the "Company") in connection with the preparation and
filing with the Securities and Exchange Commission under the Securities Act of
1933, as amended, of the Registration Statement relating, in part, to 2,841,898
shares of the Company's common stock, registered by the Company (the "Shares").
In so acting, we have examined originals, or copies certified or otherwise
identified to our satisfaction, and such corporate records, documents,
certificates and other instruments as in our judgment are necessary or
appropriate to enable us to render the opinion expressed below. We have assumed
for purposes of this opinion that any Shares issuable upon the the exercise of
any warrants to acquire Shares as described in the Registration Statement (1)
are issued upon the valid exercise of the underlying securities, and (2) in the
case of Shares issued upon the exercise of any warrants, the receipt by the
Company of the warrant exercise price.
Based upon the foregoing, we are of the opinion as follows:
1. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the state of Delaware.
2. The Shares, when issued and sold in the manner contemplated by the
Registration Statement, will be validly issued, fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the Registration
Statement and to the use of our name under the caption "Legal Counsel" in the
prospectus that is a part thereof.
Very truly yours,
/s/ Gilmore & Bell, P.C.
Exhibit 23.2
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333- ) and related Prospectus of AVAX
Technologies, Inc. for the registration of 7,671,102 shares of its common stock
and to the incorporation by reference therein of our report dated January 14,
2000, with respect to the financial statements of AVAX Technologies, Inc.
included in its Annual Report (Form 10-KSB) for the year ended December 31,
1999, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Kansas City, Missouri
April 11, 2000
