<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C., 20549
-----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
IMPLANT SCIENCES CORPORATION
(Exact Name of Registrant as Specified in its Charter)
MASSACHUSETTS 04-2837126
(State or other jurisdiction of (IRS Employer Identification No.)
Incorporation or Organization)
107 AUDUBON ROAD #5
WAKEFIELD, MA 01880
(Address of Principal Executive Offices) (Zip Code)
IMPLANT SCIENCES CORPORATION
1998 INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
1992 STOCK OPTION PLAN
1998 EMPLOYEE STOCK PURCHASE PLAN
(Full Title of the Plan)
----------------------
ANTHONY J. ARMINI
107 Audubon Road, #5
Wakefield, Massachusetts 01880
(781) 246-0700 / Facsimile No.: (781) 246-1167
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of all communications to:
DAVID A. BROADWIN, ESQ.
FOLEY, HOAG & ELIOT LLP
One Post Office Square
Boston, Massachusetts 02109-2170
(617) 832-1000 / Facsimile No.: (617) 832-7000
--------------------
<PAGE> 2
CALCULATION OF REGISTRATION FEE
------------------------------------------------
<TABLE>
<CAPTION>
Title of Securities to Amount to be Proposed Maximum Proposed Maximum Amount of
Be Registered Registered Offering Price per Aggregate Offering Registration
Share(1) Price(1) Fee
<S> <C> <C> <C> <C>
Common Stock
($.10 par value) 462,510 shares $7.687 $3,555,314.37 $ 939(2)
Common Stock
($.10 par value) 316,758 shares $1.60 $ 506,812.80 $ 134(3)
Common Stock
($.10 par value) 123,364 shares $6.20 $ 764,856.80 $ 202(4)
Common Stock
($.10 par value) 116,636 shares $7.687 $ 896,580.93 $ 237(5)
Common Stock
($.10 par value) 139,336 shares $6.533 $ 910,282.09 $ 240(6)
Common Stock
($.10 par value) 1,664 shares $7.687 $ 12,791.17 $ 3(7)
</TABLE>
(1) Estimated solely for the purposes of determining the registration fee.
(2) In accordance with Rule 457(c) under the Securities Act of 1933, the
calculation with respect to shares issued and outstanding at July 28, 2000
pursuant to the exercise of stock options granted under the Implant
Sciences Corporation 1992 Stock Option Plan is based on the average of the
high and low sale prices reported on the American Stock Exchange on July
28, 2000.
(3) In accordance with Rule 457(h) under the Securities Act of 1933, the
calculation with respect to shares issuable under stock options granted
under the 1992 Plan and outstanding at July 28, 2000 is based on the
exercise prices of such options.
(4) In accordance with Rule 457(h) under the Securities Act of 1933, the
calculation with respect to shares issuable under stock options granted
under the 1998 Incentive and Nonqualified Stock Option Plan and outstanding
at July 28, 2000 is based on the exercise prices of such options.
(5) In accordance with Rules 457(c) and (h) under the Securities Act of 1933,
the calculation with respect to shares issuable pursuant to options that
may be granted under the 1998 Plan but that have not yet been granted as of
July 28, 2000 is based on the average of the high and low sale prices
reported on the American Stock Exchange on July 28, 2000.
(6) In accordance with Rules 457(c) and (h) under the Securities Act of 1933,
the calculation with respect to shares issuable pursuant to the 1998
Employee Stock Purchase Plan is based on 85% of the average of the high and
low sale prices reported on the American Stock Exchange on July 28, 2000.
(7) In accordance with Rule 457(c) under the Securities Act of 1933, the
calculation with respect to shares issued and outstanding at July 28, 2000
pursuant to the purchase of shares under the 1998 Employee Stock Purchase
Plan is based on the average of the high and low sales prices reported on
the American Stock Exchange on July 28, 2000
<PAGE> 3
REOFFER PROSPECTUS
The material which follows, up to but not including the page beginning
Part II of this registration statement, constitutes a Reoffer Prospectus
prepared in accordance with the applicable requirements of Part I of Form S-3
under General Instruction C to Form S-8. The Reoffer Prospectus is to be used in
connection with resales of restricted securities issued and outstanding under
the 1992 Stock Option Plan and the 1998 Employee Stock Purchase Plan.
<PAGE> 4
464,174 SHARES
IMPLANT SCIENCES CORPORATION
COMMON STOCK
THIS DOCUMENT CONSTITUTES PART OF A REGISTRATION STATEMENT
COVERING SECURITIES THAT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933
This Reoffer Prospectus relates to the resale, by the holders of
464,174 shares of common stock, par value $.10 per share, of Implant Sciences
Corporation, issued pursuant to the exercise of options granted under the 1992
Stock Option Plan and the purchase of stock under the 1998 Employee Stock
Purchase Plan. We will refer to such holders as selling stockholders.
We will not receive any of the proceeds from the offering. We will bear
the costs relating to the registration of the shares offered hereby (other than
selling commissions).
The selling stockholders named herein or any pledgees, donees,
transferees or other successors in interest, may offer the shares of common
stock, from time to time during the effectiveness of this registration, for sale
through the American Stock Exchange, in one or more negotiated transactions, or
through a combination of methods of sale, at prices and on terms then prevailing
or at negotiated prices. Sales may be effected to or through broker-dealers, who
may receive compensation in the form of discounts, concessions or commissions in
connection therewith. See "Plan of Distribution."
Our common stock is traded on the American Stock Exchange under the
symbol "IMX." On July 28, 2000, the closing price for the common stock, as
reported on the American Stock Exchange, was $7.875 per share.
Our executive offices are located at 107 Audubon Road #5, Wakefield,
Massachusetts, and our telephone number at that location is (781) 246-0700.
------------------
The common stock offered hereby involves a high degree of risk.
SEE "RISK FACTORS" BEGINNING AT PAGE 3.
------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE DATE OF THIS PROSPECTUS IS AUGUST 2, 2000.
<PAGE> 5
AVAILABLE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith we file reports and other information with the Securities and Exchange
Commission. You may inspect such reports and other information and obtain copies
(at prescribed rates) at the Commission's Public Reference Section, 450 Fifth
Street, N.W., Room 1024, Washington D.C. 20549, and at the Commission's Regional
Offices at Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and 7 World Trade Center, Suite 1300, New York, New
York 10048. Our SEC filings are also available to the public on the Security and
Exchange Commission's website at http://www.sec.gov. You may also inspect
reports and other information concerning Implant Sciences at the offices of the
American Stock Exchange.
This Reoffer Prospectus constitutes part of a Registration Statement on
Form S-8 (the "Registration Statement") filed by us with the Commission under
the Securities Act of 1933, as amended (the "Securities Act"). This Reoffer
Prospectus does not contain all of the information contained in the Registration
Statement, and reference is hereby made to the Registration Statement and
related exhibits for further information with respect to our company and the
securities offered hereby. Any statements contained herein concerning the
provisions of any document are not necessarily complete, and, in such instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents which we have previously filed with the
Commission pursuant to the Securities Act and the Exchange Act are incorporated
herein by reference: (1) our Annual Report on Form 10-KSB for the fiscal year
ended June 30, 1999, (2) certain portions of our Registration Statement on Form
SB-2, File No. 333-64499; (3) our Quarterly Report on Form 10-QSB for the
quarterly period ended September 30, 1999; (4) our Quarterly Report on Form
10-QSB for the quarterly period ended December 31, 1999; and (5) our Quarterly
Report on Form 10-QSB for the quarterly period ended March 31, 2000.
All reports and other documents subsequently filed by the company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date
of this Reoffer Prospectus and prior to the termination of the offering made
hereby shall be deemed to be incorporated by reference herein and to be a part
hereof from the date of the filing of such reports and documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this Reoffer
Prospectus to the extent that a statement contained herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of the
Registration Statement or this Reoffer Prospectus.
Any person to whom a copy of this Reoffer Prospectus is delivered may
obtain, without charge, upon written or oral request, a copy of any of the
documents incorporated by reference
<PAGE> 6
herein, except for the exhibits to such documents (other than exhibits expressly
incorporated by reference into such documents). Requests for such documents
should be addressed to the Chief Financial Officer of Implant Sciences
Corporation, 107 Audubon Road, #5, Wakefield Massachusetts 01880 or directed to
the Chief Financial Officer at telephone number (781) 246-0700.
RISK FACTORS
WE DO NOT OPERATE AT A PROFIT AND DO NOT EXPECT TO BE PROFITABLE FOR
SOME TIME.
During the nine months ended March 31, 2000, the Company had a net loss
of $1,627,875. The Company plans to further increase its expenditures to
complete development and commercialization of its new products, to increase its
manufacturing capacity and equipment, to ensure compliance with the FDA's
Quality System Regulations and broaden its sales and marketing capabilities. As
a result, the Company believes that it will likely incur losses over the next
several quarters. The accumulated deficit as of March 31, 2000 was $2,163,704.
INTENSE COMPETITION AND RAPID TECHNOLOGICAL CHANGE COULD HARM OUR
FINANCIAL PERFORMANCE.
The medical device industry is characterized by rapidly evolving
technology and intense competition. Among the most closely competing products in
intracoronary radiation therapy are radioactive tipped guidewires and
radioactive fluid-filled balloons. Many of our competitors have substantially
greater capital resources, greater research and development, manufacturing and
marketing resources and experience and greater name recognition than we do.
There can be no assurance that our competitors will not succeed in developing or
marketing technologies and products that are more effective than our products or
that would render our products obsolete or noncompetitive. Moreover, there can
be no assurance that we will be able to price our products at or below the
prices of competing products and technologies in order to facilitate market
acceptance. In addition, new procedures and medications could be developed that
replace or reduce the importance of procedures that use our products.
Accordingly, our success will depend in part on our ability to respond quickly
to medical and technological changes through the development and introduction of
new products and enhancements. Product development involves a high degree of
risk and there can be no assurance that our new product development efforts will
result in any commercially successful products. Our failure to compete or
respond to technological change in an effective manner would have a material
adverse effect on our business.
OUR PRODUCTS AND TECHNOLOGIES MAY NOT BE ACCEPTED BY THE MEDICAL
COMMUNITY WHICH COULD HARM OUR FINANCIAL PERFORMANCE.
There can be no assurance that our radioactive prostate seeds and
coronary stents, orthopedic ceramic coatings, or radiopaque coatings will
achieve acceptance, or continue to receive acceptance, by the medical community
and market acceptance generally. The degree of market acceptance for our
products and services will also depend upon a number of factors
<PAGE> 7
including the receipt and timing of regulatory approvals and the establishment
and demonstration in the medical community and among health care payers of the
clinical safety, efficacy and cost effectiveness of our products. Certain of the
medical indications that can be treated by our devices or devices treated using
our coatings can also be treated by other medical procedures. Decisions to
purchase our products will primarily be influenced by members of the medical
community, who will have the choice of recommending medical treatments, such as
radiotherapeutic seeds, or the more traditional alternatives, such as surgery
and external beam radiation therapy. Many alternative treatments currently are
widely accepted in the medical community and have a long history of use. There
can be no assurance that our devices or technologies will be able to replace
such established treatments or that physicians, health care payers, patients or
the medical community in general will accept and utilize our devices or any
other medical products that may be developed or treated by us even if regulatory
and reimbursement approvals are obtained. Long-term market acceptance of our
products and services will depend, in part, on the capabilities, operating
features and price of the our products and technologies as compared to those of
other available products and services. Failure of our products and
technologies to gain market acceptance would have a material adverse effect on
our business.
WE HAVE LIMITED INTERNAL MARKETING AND SALES RESOURCES AND MAY NOT BE
ABLE TO MARKET OR DISTRIBUTE OUR PRODUCTS SUCCESSFULLY.
Because our medical products will be targeted to the medical community,
we will have limited options in distributing our products and may incur
additional requirements imposed on us by the FDA or our customers or
distribution partners with respect to product characteristics and quality. A
significant portion of our sales to date have depended on our ability to provide
products that meet the requirements of other medical product companies. There
can be no assurance that we will be able to market our products successfully or
that we will be able to enter into contracts for distribution of our products.
We have limited internal marketing and sales resources and personnel. In order
to market and sell our products and services, we expect to enter into
distribution agreements. There can be no assurance that we will be able to enter
into such agreements.
OUR FUTURE PROFITABILITY DEPENDS ON OUR ABILITY TO COMPLETE DEVELOPMENT
OF OUR PRODUCTS.
We currently market or plan to market products, including radioactive
prostate seeds, radioactive tipped guidewires and radioactive coronary stents,
orthopedic ceramic coatings, and radiopaque coatings that may require
substantial further investment in research, product development, preclinical and
clinical testing and governmental regulatory approvals prior to being marketed
and sold. Our ability to increase revenues and achieve profitability and
positive cash flow will depend, in part, on our ability to complete such product
development efforts, obtain such regulatory approvals, and establish
manufacturing and marketing programs and gain market acceptance for such
proposed products.
In particular, our radioactive coronary stents are in an early stage of
development. There can be no assurance that the clinical trials will ever be
undertaken or, if undertaken, will
<PAGE> 8
conclude that the radioactive coronary stents have a sufficient degree of safety
and efficacy. In addition, there can be no assurance that the radioactive
coronary stents will reduce the frequency of restenosis outside of test
conditions.
Our product development efforts are subject to the risks inherent in
the development of such products. These risks include the possibility that our
products will be found to be ineffective or unsafe, or will otherwise fail to
receive necessary regulatory approvals; that the products will be difficult to
manufacture on a large scale or be uneconomical to market; that the proprietary
rights of third parties will interfere with our product development; or that
third parties will market superior or equivalent products which achieve greater
market acceptance. Furthermore, there can be no assurance that we will be able
to conduct our product development efforts within the time frames currently
anticipated or that such efforts will be completed successfully.
WE OWN PATENTS, TRADE SECRETS AND OTHER INTELLECTUAL PROPERTY AND
KNOW-HOW THAT WE BELIEVE ALLOWS US TO COMPETE EFFECTIVELY. LIMITATIONS ON OUR
ABILITY TO PROTECT OUR INTELLECTUAL PROPERTY OR CONTINUE TO USE OUR INTELLECTUAL
PROPERTY COULD HARM OUR FINANCIAL PERFORMANCE.
Our ability to compete effectively will depend to a significant extent
on our ability to operate without infringing the intellectual property rights of
others. Many participants in the medical device area aggressively seek patent
protection and have increasing numbers of patents, and have frequently
demonstrated a readiness to commence litigation based on patent infringement.
Third parties may assert exclusive patent rights to technologies that are
important to us.
We are aware of a U.S. patent of a third party having broad claims
covering radioactive stents and methods of using radioactive stents for the
treatment of restenosis. We have not sought a formal opinion of counsel
regarding the validity of this patent or whether our processes may infringe this
patent. We plan to implant radioactivity onto coronary stents manufactured by
the patent holder, its licensees or others. If our plans to implant
radioactivity onto the patent holder's stents do not succeed, and/or if we
implant radioactivity onto stents that are not manufactured by the patentholder
or its licensees, there can be no assurance that the holder of this patent will
not seek to enforce the patent against us or the manufacturer of the stents, or
that we would prevail in any such enforcement action.
If the patent holder seeks to enforce the patent against us, we may be
required to engage in costly and protracted litigation; discontinue the
manufacture or activation of radioactive stents; develop non-infringing
technology; or enter into a license arrangement with respect to the patent.
There can be no assurance that we would be able to develop non-infringing
technology, or that any necessary licenses would be available, or that, if
available, such licenses could be obtained on commercially reasonable terms.
There can be no assurance that any such litigation would not result in the
patent holder obtaining an injunction which would prevent us from implanting
radioactivity onto stents. In addition, the costs associated with defending a
patent infringement claim are significant, even if we ultimately prevails, and
we would be required to commit considerable financial and management resources
in defending such claim which would have a material adverse effect on our
business, financial condition, and results of operations.
<PAGE> 9
OUR SUCCESS WILL DEPEND ON OUR ABILITY TO OBTAIN NEW PATENTS AND
OPERATE WITHOUT INFRINGING ON THE PROPRIETARY RIGHTS OF OTHERS.
Although we have sixteen United States patents issued and eight United
States and four international patent applications pending for our technology and
processes, our success will depend, in part, on our ability to obtain the
patents applied for and maintain trade secret protection for our technology and
operate without infringing on the proprietary rights of third parties. The
validity and breadth of claims in medical technology patents involve complex
legal and factual questions and, therefore, may be highly uncertain. No
assurance can be given that any pending patent applications or any future patent
application will issue as patents that the scope of any patent protection
obtained will be sufficient to exclude competitors or provide competitive
advantages to us, that any of our patents will be held valid if subsequently
challenged or that others will not claim rights in or ownership of the patents
and other proprietary rights held us. Furthermore, there can be no assurance
that others have not or will not develop similar products, duplicate any of our
products or design around any patents issued or that may be issued in the future
to us. In addition, whether or not patents are issued to us, others may hold or
receive patents which contain claims having a scope that covers products or
processes developed by us.
Moreover, there can be no assurances that patents issued to us will not
be challenged, invalidated or circumvented or that the rights thereunder will
provide any competitive advantage. We could incur substantial costs in defending
any patent infringement suits or in asserting any patent rights, including those
granted to third parties. Patents and patent applications in the United States
may be subject to interference proceedings brought by the U.S. Patent &
Trademark Office, or to opposition proceedings initiated in a foreign patent
office by third parties. We may incur significant costs defending such
proceedings. In addition, we may be required to obtain licenses to patents or
proprietary rights from third parties. There can be no assurance that such
licenses will be available on acceptable terms if at all. If we do not obtain
required licenses, we could encounter delays in product development or find that
the development, manufacture or sale of products requiring such licenses could
be foreclosed
We also rely on unpatented proprietary technology, trade secrets and
know-how and no assurance can be given that others will not independently
develop substantially equivalent proprietary information, techniques or
processes, that such technology or know-how will not be disclosed or that we can
meaningfully protect our rights to such unpatented proprietary technology, trade
secrets, or know-how. Although we have entered into non-disclosure agreements
with our employees and consultants, there can be no assurance that such non-
disclosure agreements will provide adequate protection for our trade secrets or
other proprietary know-how.
IF WE ARE NOT SUCCESSFUL IN MANAGING OUR FUTURE GROWTH, OUR BUSINESS
WILL SUFFER.
We have very limited experience in the commercial production of
radioactive prostate seeds and radioactive tipped guidewires or the commercial
implantation of therapeutic radiation onto coronary stents. Our future success
will depend upon, among other factors, our ability to
<PAGE> 10
recruit, hire, train and retain highly educated, skilled and experienced
management and technical personnel, to generate capital from operations, to
scale-up its manufacturing process and expand our facilities and to manage the
effects of growth on all aspects of our business, including research,
development, manufacturing, distribution, sales and marketing, administration
and finance. Our failure to identify and exploit new product and service
opportunities, attract or retain necessary personnel, generate adequate revenues
or conduct our expansion or manage growth effectively could have a material
adverse effect on our business.
WE ARE DEPENDENT ON A SMALL NUMBER OF CUSTOMERS FOR A SIGNIFICANT
PORTION OF OUR SALES. THE LOSS OF BUSINESS FROM THESE CUSTOMERS WOULD HARM OUR
FINANCIAL PERFORMANCE.
Approximately 45.1% of our sales in the nine months ended March 31,
2000 were made to the Howmedica/Osteonics Division of Stryker Corporation and
Biomet, Incorporated. All of these sales were of nitrogen ion implantation that
enhance orthopedic joint implants. We have no significant purchase commitments
from these or other customers extending beyond one year. There can be no
assurance that these customers will continue to purchase our products and
services at the same levels as in previous years or that such relationships will
continue in the future. The loss of a significant amount of business from any of
these customers would have a material adverse effect on the sales and operating
results. We have an agreement to supply an ion implantation process to a
customer through January 2001.
OUR MEDICAL DEVICE PRODUCTS AND SERVICES ARE SUBJECT TO EXTENSIVE
GOVERNMENT REGULATION. IF WE FAIL TO OBTAIN OR ARE DELAYED IN OBTAINING THE
APPROVAL OF THE NECESSARY FEDERAL AND STATE GOVERNMENT AGENCIES, OUR BUSINESS
COULD BE MATERIALLY AFFECTED.
The manufacture and sale of our medical device products and services
are subject to extensive regulation principally by the Food and Drug
Administration (the "FDA") in the United States and corresponding foreign
regulatory agencies in each country in which it sells its products. These
regulations affect product approvals, product standards, packaging requirements,
design requirements, manufacturing and quality assurance, labeling, import
restrictions, tariffs and other tax requirements. Securing FDA authorizations
and approvals requires submission of extensive clinical data and supporting
information. In most instances, the manufacturers or licensees of medical
devices that are treated by us will be responsible for securing regulatory
approval for medical devices incorporating our technology. However, we plan on
preparing and maintaining Device Master Files which may be accessed by the FDA.
We expect to incur substantial product development, clinical research and other
expenses in connection with obtaining final regulatory clearance or approval for
and commercialization of our products.
There can be no assurance that our medical device manufacturers or
licensees will be able to obtain regulatory clearance or approval for devices
incorporating our technology on a timely basis, or at all. Regulatory clearance
or approvals, if granted, may include significant limitations of the indicated
uses for which the product may be marketed. In addition, product clearance or
approval could be withdrawn for failure to comply with regulatory standards or
the occurrence of unforeseen problems following initial marketing. Changes in
existing regulations or adoption of new governmental regulations or policies
could prevent or delay regulatory approval of products incorporating our
technology or subject us to additional regulation.
<PAGE> 11
In addition to FDA regulation, certain of our activities are regulated
by and require approvals from other federal and state agencies. The use,
management, transportation, and disposal of certain materials and wastes are
subject to regulation by several federal and state agencies depending on the
nature of the materials or waste material. Certain toxic chemicals and products
containing toxic chemicals may require special reporting to the United States
Environmental Protection Agency and/or its state counterparts. Our future
operations may require additional approvals from federal and/or state
environmental agencies. There can be no assurance that we will be able to obtain
necessary government approvals, or that we will be able to operate with the
conditions that may be attached to future regulatory approvals. Moreover, there
can be no assurance that we will be able to maintain previously-obtained
approvals. While it is our policy to comply with applicable regulations, failure
to comply with existing or future regulatory requirements and failure to obtain
or maintain necessary approvals could have a material adverse effect on our
business, financial condition, and results of operations.
Failure or delay of our medical device manufacturers in obtaining FDA
and other necessary regulatory clearance or approval, the loss of previously
obtained clearance or approvals, as well as failure to comply with other
existing or future regulatory requirements could have a material adverse effect
on our business, financial condition and results of operations.
Because certain of our products utilize radiation sources, their
manufacture, distribution, transportation, import/export, use and disposal will
also be subject to federal, state and/or local laws and regulations relating to
the use, handling, procurement and storage of radioactive materials. We must
also comply with U.S. Department of Transportation regulations on the labeling
and packaging requirements for shipment of radiation sources to hospitals or
other users of our products. We expect that there will be comparable regulatory
requirements and/or approvals in markets outside the United States. If any of
the foregoing approvals are significantly delayed or not obtained, our business
could be materially adversely affected.
OUR RESEARCH AND MANUFACTURING ACTIVITIES INVOLVE THE USE OF HAZARDOUS
MATERIALS. ANY LIABILITY RESULTING FROM THE MISUSE OF SUCH HAZARDOUS MATERIALS
COULD ADVERSELY AFFECT OUR BUSINESS.
Our research and manufacturing activities sometimes involve the use of
various hazardous materials. Although we believe that our safety procedures for
handling, manufacturing, distributing, transporting and disposing of such
materials comply with the standards for protection of human health, safety, and
the environment, prescribed by local, state, federal and international
regulations, the risk of accidental contamination or injury from these materials
cannot be completely eliminated. Nor can we eliminate the risk that one or more
of our hazardous material or hazardous waste handlers may cause contamination
for which, under laws imposing strict liability, we could be held liable. While
we currently maintain insurance in amounts which we believe are appropriate in
light of the risk of accident, we could be held liable for any damages that
might result from any such event. Any such liability could exceed our insurance
and available resources and could have a material adverse effect on our
business.
<PAGE> 12
OUR SUCCESS DEPENDS ON OUR ABILITY TO ATTRACT STRATEGIC PARTNERS.
We intend to continue pursuing a strategy of researching, developing
and commercializing new products using the financial and technical support of
corporate partners. Our success will depend, in part, on our ability to attract
additional partners. There can be no assurance that we can successfully enter
into additional strategic alliances or that such alliances will result in
increased commercialization of our products.
WE DEPEND ON THIRD PARTY REIMBURSEMENT TO OUR CUSTOMERS FOR MARKET
ACCEPTANCE OF OUR PRODUCTS. IF THIRD PARTY PAYORS FAIL TO PROVIDE APPROPRIATE
LEVELS OF REIMBURSEMENT FOR OUR PRODUCTS, OUR PROFITABILITY WOULD BE ADVERSELY
AFFECTED.
Medicare, Medicaid and other government insurance programs, as well as
private insurance reimbursement programs greatly affect suppliers of health care
products. Several of the products produced or processed by us, including our
orthopedic implants, prostate seeds, radioactive stents, and interventional
cardiology instruments and devices, are currently being reimbursed by third
party payers. Our customers rely on third-party reimbursements to cover all or
part of the costs of most of the procedures in which our products are used.
Third party payers (including health maintenance organizations) may affect the
pricing or relative attractiveness of our products by regulating the maximum
amount of reimbursement provided by such payers to the physicians, hospitals and
clinics using our devices, or by taking the position that such reimbursement is
not available at all. The amounts of reimbursement by third party payers in
those states that do provide reimbursement varies considerably. Major third
party payers reimburse inpatient medical treatment, including all or most
operating costs and all or most furnished items or services, including devices
such as ours, at a prospectively fixed rate based on the diagnostic-related
group ("DRG") that covers such treatment as established by the federal Health
Care Financing Administration. For interventional cardiology procedures, the
fixed rate of reimbursement is based on the procedure or procedures performed
and is unrelated to the specific devices used in such procedure. Therefore, the
amount of profit realized by suppliers of health care services in connection
with the procedure may be reduced by the use of our devices if they prove to be
costlier than competing products. If a procedure is not covered by a DRG,
certain third party payers may deny reimbursement.
Alternatively, a DRG may be assigned that does not reflect the costs
associated with the use of our devices or devices treated using our services,
resulting in limited reimbursement. If, for any reason, the cost of using our
products or services was not to be reimbursed by third party payers, our ability
to sell our products and services would be materially adversely affected. In the
international market, reimbursement by private third party medical insurance
providers, and governmental insurers and providers, varies from country to
country. In certain countries, our ability to achieve significant market
penetration may depend upon the availability of third party governmental
reimbursement.
PRODUCT LIABILITY CLAIMS COULD DAMAGE OUR REPUTATION AND HURT OUR
FINANCIAL RESULTS.
To date no product liability claims have been asserted against us;
however, the testing, marketing and sale of implantable devices and materials
entail an inherent risk that product
<PAGE> 13
liability claims will be asserted against us, if the use of our devices is
alleged to have adverse effects on a patient, including exacerbation of a
patient's condition, further injury, or death. A product liability claim or a
product recall could have a material adverse effect on our business. Certain of
our devices are designed to be used in treatments of diseases where there is a
high risk of serious medical complications or death. Although we have obtained
product liability insurance coverage, there can be no assurance that in the
future we will be able to obtain such coverage on acceptable terms or that
insurance will provide adequate coverage against any or all potential claims.
Furthermore there can be no assurance that we will avoid significant product
liability claims and the attendant adverse publicity. Any product liability
claim or other claim with respect to underinsured liabilities could have a
material adverse effect on our business.
IF OUR SUPPLIERS CANNOT PROVIDE THE COMPONENTS OR SERVICES WE REQUIRE,
OUR ABILITY TO MANUFACTURE OUR PRODUCTS COULD BE HARMED.
We rely on a limited number of suppliers to provide materials and
services used to manufacture our products. If we cannot obtain adequate
quantities of necessary materials and services from our suppliers, there can be
no assurance that we would be able to access alternative sources of supply
within a reasonable period of time or at commercially reasonable rates.
Moreover, in order to maintain our relationship with major suppliers, we may be
required to enter into preferred supplier agreements that will increase the cost
of materials obtained from such suppliers, thereby also increasing the prices of
our products. The limited sources, the unavailability of adequate quantities,
the inability to develop alternative sources, a reduction or interruption in
supply or a significant increase in the price of raw materials or services could
have a material adverse effect on our business.
IF WE WERE TO LOSE THE SERVICES OF EITHER OUR PRESIDENT OR OUR CHIEF
SCIENTIST, OUR BUSINESS WOULD BE ADVERSELY AFFECTED.
We are substantially dependent, for the foreseeable future, upon our
Chairman of the Board, President and Chief Executive Officer, Dr. Anthony J.
Armini and our Vice President and Chief Scientist, Dr. Stephen N. Bunker, both
of whom currently devote their full time and efforts to management. We have
entered into an employment agreement with each of these officers. If we were to
lose the services of Dr. Armini or Dr. Bunker for any significant period of
time, our business would be materially adversely affected. We maintain key man
life insurance policies of $1,000,000 and $500,000 respectively, insuring the
lives of Messrs. Armini and Bunker.
IF WE CANNOT ATTRACT AND RETAIN THE MANAGEMENT, SALES AND OTHER
PERSONNEL WE NEED, WE WILL NOT BE SUCCESSFUL.
There is intense competition for qualified personnel in the medical
device field, and there can be no assurance that we will be able to continue to
attract and retain qualified personnel necessary for the development of our
business. The loss of the services of existing personnel as well as the failure
to recruit additional qualified scientific, technical and managerial personnel
in a timely manner would be detrimental to our anticipated growth and expansion
into areas and activities requiring additional expertise such as marketing. The
failure to attract and retain such personnel could adversely affect our
business.
<PAGE> 14
OUR QUARTERLY RESULTS MAY FLUCTUATE SIGNIFICANTLY WOULD COULD ADVERSELY
AFFECT OUR STOCK PRICE.
We believe that our operating results may be subject to substantial
quarterly fluctuations due to several factors, some of which are outside our
control, including fluctuating market demand for, and declines in the average
selling price of our products, the timing of significant orders from customers,
delays in the introduction of new or improved products, delays in obtaining
customer acceptance of new or changed products, the cost and availability of raw
materials, and general economic conditions. We plan to further increase our
expenditures to complete development and commercialize our new products, to
increase our manufacturing capacity, to ensure compliance with the FDA's Quality
Systems Regulations and to broaden our sales and marketing capabilities. A
substantial portion of our revenue in any quarter historically has been derived
from orders booked in that quarter, and historically, backlog has not been a
meaningful indicator of revenues for a particular period. Accordingly, our sales
expectations currently are based almost entirely on its internal estimates of
future demand and not from firm customer orders.
<PAGE> 15
USE OF PROCEEDS
We will not receive any proceeds from the sale of common stock by the
selling stockholders, nor will any such proceeds be available for use by us or
otherwise for the our benefit. See "Selling Stockholders."
OUR COMPANY
OUR BUSINESS
Implant Sciences Corporation was incorporated in August 1984 and has,
over the past sixteen years, developed core technologies using ion implantation
and thin film coatings for medical device applications and has proprietary
processes and equipment for the manufacture of medical radiation therapeutic
devices. We are applying this technology to manufacture radioactive prostate
seeds ("I-Plant Seeds") using a dry fabrication process which we believe is more
cost-effective and less hazardous than conventional processes which use
radioactive wet chemistry. The I-Plant seeds will be made radioactive in a
nuclear reactor prior to shipment to customers. We believe that the
opportunities for radioactive prostate seeds will continue to grow as an
attractive alternative to other methods of treatment. On May 26, 1999, we
received notification of pre-market clearance for our iodine-125 seed from the
Food and Drug Administration ("FDA"). In the interventional cardiology field, we
have a joint development agreement with a major stent manufacturer and an NIH
Phase II grant to develop radioactive coronary stents. We believe these
implants, radioactive seeds used for the treatment of prostate cancer and
radioactive coronary stents for the prevention of restenosis (reclosure of the
artery) after balloon angioplasty, will have a significant competitive advantage
over currently existing devices.
We are currently developing our proprietary thin film coating
technology in order to apply it to radiopaque (visible by x-ray) coatings on
stents, guidewires, catheters and other devices used in interventional
cardiology procedures. In addition, we are applying our ion implantation
technologies to modify surfaces to reduce polyethylene wear generation in
orthopedic joint implants, manufactured by the Howmedica/Osteonics Division of
Stryker Corporation and Biomet Incorporated. We also supply ion implantation
services to numerous semiconductor manufacturers, research laboratories and
universities. We currently have sixteen issued United States patents and eight
United States patents pending covering our technologies and processes. We also
have four international patent applications pending.
Although there are a wide range of commercial applications for our
proprietary technologies, we have chosen to focus on the medical device
industry. Within the medical device industry, we are concentrating on the
prostate cancer, interventional cardiology and orthopedic segments.
OUR TECHNOLOGY
We use two core technologies, ion implantation and thin film coatings,
to provide enhanced surfaces to various medical implants and semiconductor
products. With respect to each
<PAGE> 16
core technology, we have developed proprietary processes and equipment for the
purpose of improving or altering the surfaces of medical implants and
semiconductor wafers.
Ion implantation and thin film coatings are techniques first developed
in the 1970's to improve the functional surface properties of metals, ceramics
and polymers, such as friction, wear, wettability and hardness.
Ion implantation was initially developed as a means to dope
semiconductors in the fabrication of integrated circuits. The accuracy,
cleanliness and controllability of this process has made it the standard for
semiconductor manufacturing. Ion implantation is generally preferred over other
surface modification methods because it does not delaminate, does not require
high temperatures and does not deform or alter the dimensions of the treated
surface.
Thin film coatings were initially developed to interconnect transistors
on semiconductor chips. Thin films modify surfaces by layering a desired metal
or ceramic coating on the substrate material. Common thin film coating
techniques include chemical vapor deposition and physical vapor deposition.
OUR ADDRESS
Our executive offices are located at 107 Audubon Road #5, Wakefield,
Massachusetts, and our telephone number at that location is (781) 246-0700.
SELLING STOCKHOLDERS
The following table sets forth certain information with respect to the
beneficial ownership of our common stock by each of the selling stockholders as
of July 28, 2000 and as adjusted to reflect the sale of the shares of common
stock offered hereby for all selling stockholders. Beneficial ownership of the
common stock by the selling stockholders following this offering will depend on
the number of shares sold by each selling stockholder. The shares of common
stock offered by this Reoffer Prospectus may be offered from time to time by the
selling stockholders named below. The following table assumes that all the
common stock offered by this Reoffer Prospectus are sold. In addition, certain
non-affiliates of Implant Sciences who each hold less than the lesser of 1,000
shares and 1% of the shares issuable under the plan pursuant to which such
shares were granted and who, therefore, are not required to be named in the
following table may use this Reoffer Prospectus for offers and sales of up to an
aggregate of 1,664 shares of common stock.
We determined ownership in accordance with rules of the Securities and
Exchange Commission. Beneficial ownership includes voting power and/or
investment power with respect to the securities held by the named individuals.
Shares of common stock subject to options currently exercisable or exercisable
within 60 days of July 28, 2000, are deemed outstanding for purposes of
computing the percentage beneficially owned by the person holding the options
but are not deemed outstanding for purposes of computing the percentage
beneficially owned by any
<PAGE> 17
other person. Except as otherwise noted, the persons or entities named have sole
voting and investment power with respect to all shares shown as beneficially
owned by them.
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
SHARES BENEFICIALLY OWNED SHARES BENEFICIALLY OWNED
NAME AND BEFORE OFFERING(1) NUMBER OF SHARES AFTER OFFERING
RELATIONSHIP WITH THE BEING REGISTERED
COMPANY NUMBER PERCENT FOR SALE HEREBY NUMBER PERCENT
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Erik Akhund 10,200 * 10,200 0 0
-------------------------------------------------------------------------------------------------------
Charles Aviles 41,334 * 41,334 0 0
-------------------------------------------------------------------------------------------------------
Leonard DeMild 114,000 2.0% 84,000 30,000 *
-------------------------------------------------------------------------------------------------------
Donald Dench 60,000 1.0% 30,000 30,000 *
-------------------------------------------------------------------------------------------------------
Dennis Gadarowski 60,000 1.0% 30,000 30,000 *
-------------------------------------------------------------------------------------------------------
Kathleen Gadarowski and 54,000 * 54,000 0 0
Mark Gadarowski
-------------------------------------------------------------------------------------------------------
Keith Hensley 22,332 * 22,332 0 0
-------------------------------------------------------------------------------------------------------
Darryl Huntington 30,000 * 30,000 0 0
-------------------------------------------------------------------------------------------------------
Gregory Huntington, Sr. 60,000 1.0% 30,000 30,000 *
-------------------------------------------------------------------------------------------------------
Michael Nelson 63,000 1.1% 33,000 30,000 *
-------------------------------------------------------------------------------------------------------
Diane Ryan 60,000 1.0% 30,000 30,000 *
-------------------------------------------------------------------------------------------------------
Richard Sahagian 90,000 1.6% 33,642 56,358 1.0%
-------------------------------------------------------------------------------------------------------
David Santos 30,000 * 30,000 0 0
-------------------------------------------------------------------------------------------------------
Johann Wood 4,002 * 4,002 0 0
-------------------------------------------------------------------------------------------------------
</TABLE>
* Less than 1%.
(1) Includes shares of common stock not currently owned but which are subject
to options currently exercisable or exercisable within 60 days of
July 28, 2000.
The Registration Statement shall also cover any additional shares of
common stock that become issuable in connection with the shares of common stock
registered for sale hereby by reason of any stock dividend, stock split,
recapitalization, or other similar transaction effected without the receipt of
consideration that results in an increase in the number of outstanding shares of
our common stock.
PLAN OF DISTRIBUTION
The shares offered hereby may be sold from time to time by the selling
stockholders, the pledgees, donees, transferees or other successors in interest
of the selling stockholders and by certain unnamed non-affiliates of the
company, each of whom holds less than 1,000 shares purchased under the 1998
Employee Stock Purchase Plan. Such sales may be made on the American Stock
Exchange, or otherwise, at prices and on terms then prevailing or at prices
related to the then-current market prices, or in negotiated transactions at
negotiated prices. The shares may be sold by one or a combination of the
following: (a) a block trade in which the broker or dealer so engaged will
attempt to sell the shares as agent, but may position and resell a portion of
the block as principal to facilitate the transaction; (b) purchases by a broker
or dealer as principal and resale by such broker or dealer for its account
pursuant to this Reoffer Prospectus; (c) an exchange distribution in accordance
with the rules of such exchange; and (d) ordinary brokerage transactions and
transactions in which the broker solicits purchasers. In effecting sales,
brokers or dealers engaged by the selling stockholders may arrange for other
brokers or dealers to participate. Brokers or dealers will receive commissions
or discounts from selling stockholders in amounts to be negotiated immediately
prior to the sale. The selling
<PAGE> 18
stockholders and any broker-dealers that participate in the distribution may be
deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act, and any commission received by them and any profit on the resale
of shares sold by them may be deemed to be underwriting discounts and
commissions. In addition, any securities covered by this Reoffer Prospectus that
qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than
pursuant to the Reoffer Prospectus.
Upon the company being notified by a selling stockholder that any
material arrangement has been entered into with a broker-dealer for the sale of
shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, a supplemented
prospectus will be filed, if required, pursuant to Rule 424(c) under the
Securities Act, setting forth (i) the name of such selling stockholder and the
name of each of the anticipating broker-dealers, (ii) the number of shares
involved, (iii) the price at which such shares were sold, (iv) the commissions
paid or discounts or concessions allowed to such broker-dealers, where
applicable, (v) a statement to the effect that such broker-dealers did not
conduct any investigation to verify the information set out or incorporated by
reference in this Reoffer Prospectus and (vi) other facts material to the
transaction.
We have agreed to pay the expenses incurred in connection with
preparing and filing the Registration Statement and this Reoffer Prospectus
(other than selling commissions).
LIMITATIONS ON RESALE
As of the date of this Reoffer Prospectus, we do not meet the
registrant requirements for the use of Form S-3. Therefore, pursuant to General
Instruction C of Form S-8, the selling stockholders, and any other persons with
whom a selling stockholder is acting in concert for the purpose of selling
securities of the company, are subject to the volume resale limitations of Rule
144(e) under the Securities Act. Rule 144(e) limits the volume of sales of
shares for the account of persons subject to its provisions to the greater of
(a) 1% of the shares of the class outstanding as shown by the most recent report
issued or published by the issuer or (b) the average weekly trading volume in
the securities as determined pursuant to Rule 144(e).
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed upon for us by Foley, Hoag & Eliot LLP, Boston, Massachusetts.
EXPERTS
The financial statements of Implant Sciences Corporation appearing in
Implant Sciences Corporation's Annual Report on Form 10-KSB for the year ended
June 30, 1999, have been audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon included therein and incorporated herein by
reference. Such financial statements are incorporated herein by reference in
reliance upon such report given on the authority of such firm as experts in
accounting and auditing.
<PAGE> 19
No broker, dealer or any other person has been authorized to give any
information or to make any representations in connection with this offering
other than those contained in this Reoffer Prospectus, and, if given or made,
such information or representations must not be relied upon as having been
authorized by us or any selling stockholder. This Reoffer Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any securities
other than the shares of common stock to which it relates or an offer to, or a
solicitation of, any person in any jurisdiction where such an offer or
solicitation would be unlawful. Neither the delivery of this Reoffer Prospectus
nor any sale made hereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of the company since
the date hereof or that information contained herein is correct as of any time
subsequent to its date.
<PAGE> 20
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Available Information .................................................... 2
Incorporation of Certain Documents by Reference .......................... 2
Risk Factors ............................................................. 3
Use of Proceeds .......................................................... 12
Our Company .............................................................. 12
Selling Stockholders ..................................................... 13
Plan of Distribution ..................................................... 14
Legal Matters ............................................................ 15
Experts .................................................................. 16
</TABLE>
<PAGE> 21
IMPLANT SCIENCES CORPORATION
464,174 SHARES OF COMMON STOCK
PROSPECTUS
AUGUST 2, 2000
<PAGE> 22
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated in this Registration Statement by
reference:
(a) our Annual Report on Form 10-KSB for the fiscal year ended June 30,
1999, as filed with the Commission on September 28, 1999;
(b) the description of the our common stock contained in the
Registration Statement on Form SB-2 filed with the Commission on September 29,
1998 under Section 12 of the Securities Exchange Act of 1934, including any
amendments or reports filed for the purpose of updating such description;
(c) our Quarterly Report on Form 10-QSB for the quarterly period ended
September 30, 1999, as filed with the Commission on November 12, 1999;
(d) our Quarterly Report on Form 10-QSB for the quarterly period ended
December 31, 1999, as filed with the Commission on February 14, 2000; and
(e) our Quarterly Report on Form 10-QSB for the quarterly period ended
March 31, 2000, as filed with the Commission on May 15, 2000.
All documents subsequently filed by us pursuant to Sections 13(a),
13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing
of a post-effective amendment which indicates that all securities offered have
been sold or which deregisters all securities then remaining unsold, shall be
deemed to be incorporated by reference in this Registration Statement and to be
part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
No applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VI.C. of our Amended and Restated Articles of Organization
provides that a director shall not have personal liability to the company or its
stockholders for monetary damages arising out of the director's breach of
fiduciary duty as a director of the company, to the maximum extent permitted by
Massachusetts law. Section 13(b)(1 1/2) of Chapter 156B of the
<PAGE> 23
Massachusetts General Laws provides that the articles of organization of a
corporation may state a provision eliminating or limiting the personal liability
of a director to a corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, provided, however, that such provision
shall not eliminate or limit the liability of a director (i) for any breach of
the director's duty of loyalty to the corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under sections 61 or 62 of Chapter 156B of the
Massachusetts General Laws, which relate to liability for unauthorized
distributions and loans to insiders, respectively, or (iv) for any transaction
from which the director derived an improper personal benefit.
Article VI.D. of our Amended and Restated Articles of Organization
further provides that the company shall, to the fullest extent authorized by
Chapter 156B of the Massachusetts General Laws, indemnify each person who is, or
shall have been, a director or officer of the company or who is or was a
director or employee of the company and is serving, or shall have served, at our
request, as a director or officer of another organization or in any capacity
with respect to any employee benefit plan of the company, against all
liabilities and expenses (including judgments, fines, penalties, amounts paid or
to be paid in settlement, and reasonable attorneys' fees) imposed upon or
incurred by any such person in connection with, or arising out of, the defense
or disposition of any action, suit or other proceeding, whether civil or
criminal, in which they may be involved by reason of being or having been such a
director or officer or as a result of service with respect to any such employee
benefit plan. Section 67 of Chapter 156B of the Massachusetts General Laws
authorizes a corporation to indemnify its directors, officers, employees and
other agents unless such person shall have been adjudicated in any proceeding
not to have acted in good faith in the reasonable belief that such action was in
the best interests of the corporation or, to the extent such matter related to
service with respect to an employee benefit plan, in the best interests of the
participants or beneficiaries of such employee benefit plan.
The effect of these provisions would be to permit indemnification by us
for, among other liabilities, liabilities arising out of the Securities Act of
1933, as amended (the "Securities Act").
Section 67 of Chapter 156B of the Massachusetts General Laws also
affords a Massachusetts corporation the power to obtain insurance on behalf of
its directors and officers against liabilities incurred by them in those
capacities. We intend to procure a directors and officers liability and company
reimbursement liability insurance policy that (i) insures our directors and
officers against losses (above a deductible amount) arising from certain claims
made against them by reason of certain acts done or attempted by such directors
or officers and (ii) insures us against losses (above a deductible amount)
arising from any such claims, but only if we are required or permitted to
indemnify such directors or officers for such losses under statutory or common
law or under provisions of the our Amended and Restated Articles of Organization
or Amended and Restated By-Laws.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The 464,174 shares of common stock covered by this registration
statement are restricted securities being offered for resale by stockholders of
the registrant. These share were issued to
<PAGE> 24
the stockholders by the registrant in reliance on the exemption provided by
Section 4(2) of the Securities Act relating to sales by an issuer not involving
a public offering. In each case, the shares were issued to the stockholders upon
the stockholder's exercise of a stock option granted under the 1992 Stock Option
Plan or were purchased by the stockholder under the 1998 Employee Stock Purchase
Plan.
ITEM 8. EXHIBITS.
<TABLE>
<S> <C>
4.1 Specimen certificate for the common stock of the company (included as
Exhibit 4.1 to our Registration Statement on Form SB-2, Registration
Number 333-64499, and incorporated herein by reference)
5.1 Opinion of Counsel
10.2 1992 Stock Option Plan (included as Exhibit 10.30 to our Registration
Statement on Form SB-2, Registration Number 333-64499, and incorporated
herein by reference)
10.2 1998 Incentive and Non-Qualified Stock Option Plan (included as Exhibit
10.32 to our Registration Statement on Form SB-2, Registration Number
333-64499, and incorporated herein by reference)
10.3 1998 Employee Stock Purchase Plan
23.1 Consent of Independent Auditors
23.2 Consent of Counsel (included in Exhibit 5.1)
24.1 Power of Attorney (contained on the signature page)
</TABLE>
ITEM 9. UNDERTAKINGS.
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales
are being made, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of
1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the Registration
Statement; and
<PAGE> 25
(iii) 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.
Provided, however, that paragraphs 1(a)(i) and
1(a)(ii) do not apply if the information required
to be included in a post-effective amendment by
those paragraphs is contained in periodic reports
filed by the Registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference herein.
(b) 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 herein, and the offering of such securities
at that time shall be deemed to be the initial bona
fide offering thereof.
(c) To remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of
the offering.
2. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and 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 than 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.
<PAGE> 26
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 Wakefield, Massachusetts, on this 2nd day of August
2000.
IMPLANT SCIENCES CORPORATION
By: /s/Anthony J. Armini
-------------------------------------
Anthony J. Armini
President, Chief Executive Officer &
Chairman of the Board of Directors
(Principal Executive Officer)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each individual whose signature
appears below constitutes and appoints Anthony J. Armini and Darlene M.
Deptula-Hicks, and each of them, true and lawful attorneys-in-fact and agents
with full power of substitution, for and in such name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto, and all 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 which they, or any of them, may deem necessary or advisable to be done in
connection with this Registration Statement, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or any
substitute or substitutes for any or all of them, may lawfully do or cause to be
done by virtue hereof.
<PAGE> 27
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities as of August 2, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/Anthony J. Armini President; Chief Executive Officer August 2, 2000
---------------------------- Chairman of the Board of Directors
Anthony J. Armini (Principal Executive Officer)
/s/Darlene M. Deptula-Hicks Vice President & Chief Financial Officer; August 2, 2000
---------------------------- (Principal Financial Officer)
Darlene M. Deptula-Hicks
/s/Stephen N. Bunker Vice President, Chief Scientist & August 2, 2000
---------------------------- Director
Stephen N. Bunker
/s/Robert E. Hoisington Director August 2, 2000
----------------------------
Robert E. Hoisington
/s/Shunkichi Shimizu Director August 2, 2000
----------------------------
Shunkichi Shimizu
/s/Michael Szycher Director August 2, 2000
----------------------------
Michael Szycher
</TABLE>
<PAGE> 28
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<S> <C>
4.1 Specimen certificate for the common stock of the company
(included as Exhibit 4.1 to our Registration Statement on Form
SB-2, Registration Number 333-64499, and incorporated herein
by reference)
5.1 Opinion of Counsel
10.1 1992 Stock Option Plan (included as Exhibit 10.30 to our
Registration Statement on Form SB-2, Registration Number
333-64499, and incorporated herein by reference)
10.2 1998 Incentive and Non-Qualified Stock Option Plan (included
as Exhibit 10.32 to our Registration Statement on Form SB-2,
Registration Number 333-64499, and incorporated herein by
reference)
10.3 1998 Employee Stock Purchase Plan
23.1 Consent of Independent Auditors
23.2 Consent of Counsel (included in Exhibit 5.1)
24.1 Power of Attorney (contained on the signature page)
</TABLE>
