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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 24, 1997
REGISTRATION NO. 333-22359
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 5
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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BIONX IMPLANTS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 3841 22-3458598
(STATE OR OTHER (PRIMARY STANDARD (IRS EMPLOYER
JURISDICTION INDUSTRIAL IDENTIFICATION NO.)
OF INCORPORATION OR CLASSIFICATION CODE
ORGANIZATION) NUMBER)
279B GREAT VALLEY PARKWAY
MALVERN, PENNSYLVANIA 19355
(610) 296-0919
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
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DAVID W. ANDERSON
279B GREAT VALLEY PARKWAY
MALVERN, PENNSYLVANIA 19355
(610) 296-0919
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
WITH COPIES TO
PETER H. EHRENBERG, ESQ. ALEXANDER D. LYNCH, ESQ.
LOWENSTEIN, SANDLER, KOHL, FISHER & BROBECK, PHLEGER & HARRISON LLP
BOYLAN, P.A. 1633 BROADWAY, 47TH FLOOR
65 LIVINGSTON AVENUE NEW YORK, NEW YORK 10019
ROSELAND, NEW JERSEY 07068 (212) 581-1600
(201) 992-8700
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As promptly
as practicable after this Registration Statement is declared effective.
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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, please check the following box. [_]
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. [_]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED PROPOSED
TITLE OF EACH CLASS OF AMOUNT MAXIMUM MAXIMUM
SECURITIES TO BE TO BE OFFERING PRICE AGGREGATE AMOUNT OF
REGISTERED REGISTERED(1) PER UNIT(2) OFFERING PRICE(2) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common Stock, par value
$.0019 per share...... 2,300,000 shs. $14.00 $32,200,000 $9,758(3)
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(1) Includes 300,000 shares which may be purchased by the Underwriters to
cover over-allotments, if any.
(2) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(a) under the Securities Act of 1933.
(3) Previously paid.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
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 COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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reflects the increased license and grant revenues. Substantially all of the
decline in 1996 is attributable to the inclusion within products sales and
cost of goods sold of revenues and expenses associated with the purchasing and
sale of instrumentation systems and to the step-up in value of inventory
related to the Reorganization. The Company's gross profit margin applicable to
implant sales, representing implant revenues less related raw materials,
direct labor and overhead and associated variable expenses, increased from
65.1% in 1994 to 66.1% in 1995 and to 66.7% in 1996. The improvement in this
portion of the Company's gross profit margin in 1995 was attributable in large
part to a change in the Company's product mix from primarily PGA products to
primarily PLLA products. In general, the costs associated with manufacturing
PLLA products are substantially less than comparable costs for PGA products.
The improvement in this portion of the Company's gross profit margin in 1996
resulted primarily from increased sales of higher margin Meniscus Arrow
products, increased sales of higher margin PLLA products and the leveraging of
certain fixed manufacturing costs over the Company's expanded revenue base.
Selling, general and administrative expenses. Selling, general and
administrative expenses increased by 212.2% from $693,000 in 1994 to $2.2
million in 1995 and by 109.2% to $4.5 million in 1996. Such expenses were
54.8% of product sales in 1994, 159.8% of product sales in 1995 and 89.9% of
product sales in 1996. Selling, general and administrative expenses consist
primarily of commissions paid on product sales in the U.S., patent and license
related expenses, costs incurred in connection with the regulatory process,
expenses associated with supporting the Company's managed networks of
independent sales agents, distributors and dealers and, in 1996, amortization
of goodwill and patents and depreciation of property and equipment associated
with the Reorganization (such amortization and depreciation amounting to
$85,000 in 1996 and expected to be approximately $255,000 per year through
2017). The increases in the dollar amount of selling, general and
administrative expenses during these periods were primarily attributable to
increased commission payment obligations reflecting the Company's increased
product sales in the U.S. and increased expenses associated with establishing
and supporting a managed network of independent sales agents in the U.S. The
substantial increase in the percentage relationship of such expenses to
product sales in 1995 reflects the investment made by the Company in 1995 in
establishing and supporting its U.S. managed network of independent sales
agents. Such expenses were incurred in anticipation of the product sales
growth which the Company experienced in 1996.
Acquired in-process research and development. In September 1996, in
connection with the Reorganization, the Company recorded a non-recurring
charge of $2.8 million for the acquisition of in-process research and
development that had not yet reached technological feasibility.
Research and development. Research and development expenses increased by
44.7% from $190,000 in 1994 to $274,000 in 1995 and by 67.6% to $460,000 in
1996. These increases reflected an increased volume of product development
work being performed by the Company and increased staffing levels.
Other income and expense. Other income and expense consists of interest
expense and other miscellaneous expense and income items. Interest expense has
remained relatively constant over the past three years.
Income taxes. Due to operating losses in Finland and in the U.S., the
Company did not incur any tax obligations during 1994 or 1995. In 1996, one of
the Company's Finnish subsidiaries recorded a profit, which resulted in a
Finnish tax liability of $208,000.
24
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3. In September 1996, the Registrant issued and sold 55,264 shares of its
Common Stock to a former employee at an aggregate price of approximately
$50,000. Such sale was made to honor a pre-existing commitment to the former
employee.
The Registrant from time to time has granted stock options to purchase
shares of Common Stock to certain officers and employees. The following table
sets forth certain information regarding such grants:
<TABLE>
<CAPTION>
RANGE OF
NO. OF SHARES EXERCISE PRICES
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<S> <C> <C>
1995........................................... 277,009 $ .9025
1996........................................... 147,373 $4.75-$9.50
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The above securities were offered and sold by the Registrant in reliance
upon an exemption from registration under either (i) Section 4(2) of the
Securities Act as transactions not involving any public offering or (ii) Rule
701 under the Securities Act. No underwriters were involved in connection with
the sales of securities referred to in this Item 15.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
(a) Exhibits
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<C> <S>
1.1* Form of Underwriting Agreement.
Restated Certificate of Incorporation of the Registrant as currently
3.1* in effect.
3.2* Form of Restated Certificate of Incorporation to be filed after the
closing of the Offering made under this Registration Statement.
3.3* Bylaws of the Registrant, as currently in effect.
4.1* Specimen Common Stock Certificate.
5.1* Opinion of Lowenstein, Sandler, Kohl, Fisher & Boylan, P.A.
10.1* Reorganization Agreement dated as of September 5, 1996.
10.2* Form of Registrant's 1996 Stock Option/Stock Issuance Plan.
10.3* Form of Amended and Restated Employment Agreement between the
Registrant and David W. Anderson.
10.4* Form of Employment Agreement between the Registrant's Subsidiary and
Pertti Tormala, as amended.
10.5* Form of Proprietary Information and Inventions Agreement.
10.6* Investors' Rights Agreement, dated as of September 6, 1996, between
the Registrant and certain holders of the Registrant's securities.
10.7* Stock Purchase Agreement between the Registrant and Purchasers of the
Company's Preferred Stock and Warrants.
10.8*+ License Agreements between the Registrant's Subsidiary and Saul N.
Schreiber.
10.9*+ License Agreement among the Registrant's Subsidiary, Pertti Tormala,
Markku Tamminmaki and Menifix I/S.
10.10*+ Licensing, Manufacturing and Distribution Agreement among the
Registrant's Subsidiary, Pertti Tormala and various Danish and Finnish
inventors.
10.11* Shareholders' Agreement among Bionix, B.V. and certain shareholders of
the Company.
10.12* Headquarters Lease.
10.13* Security Agreements and Secured Promissory Note.
21.1* List of Subsidiaries.
23.1 Consent of KPMG Peat Marwick LLP (including a report regarding the
financial statement schedule).
23.2* Consent of Lowenstein, Sandler, Kohl, Fisher & Boylan, P.A. (included
in Exhibit 5.1).
23.3* Consent of Kenyon & Kenyon.
24.1* Power of Attorney.
27.1* Financial Data Schedule.
</TABLE>
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* Previously filed.
+ Certain portions of this exhibit have been omitted based upon a request for
confidential treatment. The omitted portions of this exhibit have been
separately filed with the Securities and Exchange Commission.
II-2
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SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT HAS DULY CAUSED THIS AMENDMENT NO. 5 TO ITS REGISTRATION STATEMENT
TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN
THE TOWN OF MALVERN, STATE OF PENNSYLVANIA, ON THE 24TH DAY OF APRIL, 1997.
BIONX IMPLANTS, INC.
/s/ David W. Anderson
By: _________________________________
David W. Anderson
(President and Chief Executive
Officer)
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS
AMENDMENT NO. 5 TO THE REGISTRANT'S REGISTRATION STATEMENT HAS BEEN SIGNED BY
THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED:
SIGNATURE TITLE DATE
/s/ David W. Anderson President, Chief April 24, 1997
- ------------------------------------- Executive Officer
DAVID W. ANDERSON and Director
(Principal
Executive Officer)
/s/ David J. Bershad* Director April 24, 1997
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DAVID J. BERSHAD
/s/ Anthony J. Dimun* Director April 24, 1997
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ANTHONY J. DIMUN
II-4
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<CAPTION>
EXHIBIT
NO. DESCRIPTION
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<C> <S> <C>
1.1* Form of Underwriting Agreement.
3.1* Restated Certificate of Incorporation of the Registrant as
currently in effect.
3.2* Form of Restated Certificate of Incorporation to be filed after
the closing of the Offering made under this Registration
Statement.
3.3* Bylaws of the Registrant, as currently in effect.
4.1* Specimen Common Stock Certificate.
5.1* Opinion of Lowenstein, Sandler, Kohl, Fisher & Boylan, P.A.
10.1* Reorganization Agreement dated as of September 5, 1996.
10.2* Form of Registrant's 1996 Stock Option/Stock Issuance Plan.
10.3* Form of Amended and Restated Employment Agreement between the
Registrant and David W. Anderson.
10.4* Form of Employment Agreement between the Registrant's Subsidiary
and Pertti Tormala, as amended.
10.5* Form of Proprietary Information and Inventions Agreement.
10.6* Investors' Rights Agreement, dated as of September 6, 1996,
between the Registrant and certain holders of the Registrant's
securities.
10.7* Stock Purchase Agreement between the Registrant and Purchasers
of the Company's Preferred Stock and Warrants.
License Agreements between the Registrant's Subsidiary and Saul
10.8*+ N. Schreiber.
10.9*+ License Agreement among the Registrant's Subsidiary, Pertti
Tormala, Markku Tamminmaki and Menifix I/S.
10.10*+ Licensing, Manufacturing and Distribution Agreement among the
Registrant's Subsidiary, Pertti Tormala and various Danish and
Finnish inventors.
Shareholders' Agreement among Bionix, B.V. and certain
10.11* shareholders of the Company.
10.12* Headquarters Lease.
10.13* Security Agreements and Secured Promissory Note.
21.1* List of Subsidiaries.
23.1 Consent of KPMG Peat Marwick LLP (including a report regarding
the financial schedule).
23.2* Consent of Lowenstein, Sandler, Kohl, Fisher & Boylan, P.A. (to
be included in Exhibit 5.1).
23.3* Consent of Kenyon & Kenyon.
24.1* Power of Attorney.
27.1* Financial Data Schedule.
</TABLE>
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* Previously filed.
+ Certain portions of this exhibit have been omitted based upon a request for
confidential treatment. The omitted portions of this exhibit have been
separately filed with the Securities and Exchange Commission.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
Bionx Implants, Inc.:
The audits referred to in our report dated January 24, 1997, except for the
first paragraph of Note 15 which is as of February 24, 1997, included the
related financial statement schedule as of December 31, 1996, and for each of
the years in the three-year period ended December 31, 1996, included in the
registration statement. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express
an opinion on the financial statement schedule based on our audits. In our
opinion, the financial statement schedule, when considered in relation to the
basic consolidated financial statements taken as a whole, presents fairly in
all material respects the information set forth therein.
We consent to the use of our reports included herein and to the reference of
our firm under the heading "Experts" in the prospectus.
KPMG PEAT MARWICK LLP
Philadelphia, Pennsylvania
April 24, 1997
