<PAGE> 1
As filed with the Securities and Exchange Commission on _______, ________
Registration No. _________
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
--------------------------------------------
CHAD THERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA 95-3792700
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
21622 PLUMMER STREET
CHATSWORTH, CALIFORNIA 91311
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
CHAD THERAPEUTICS, INC. DIRECTORS' STOCK COMPENSATION PLAN
(Full Title of the Plan)
--------------------------------------------
Earl L. Yager
21622 Plummer Street
Chatsworth, California 91311
(818) 882-0883
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
--------------------------------------------
Copies to:
Hillel T. Cohn, Esq.
Graham & James LLP
801 South Figueroa Street, 14th Floor
Los Angeles, California 90017-5554
(213) 624-2500
--------------------------------------------
Approximate date of commencement of proposed sale to the Public:
From time to time after the effective date of this Registration Statement
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 check the following box. [X]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=============================================================================================================
Title of Each Class of Securities Amount to be Proposed Proposed Maximum Amount of
to be Registered Registered Offering Price Aggregate Offering Registration
Per Share Price Fee(1)
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value(2) 100,000 $2.595 $ 259,500 $ 72.14
=============================================================================================================
</TABLE>
- ----------
(1) Calculated in accordance with Rule 457(h)(1) on the basis of the average
of the high and low prices for Chad Therapeutics, Inc.'s Common Shares
reported on the American Stock Exchange ("AMEX") consolidated reporting
system on April 9, 1999.
(2) Pursuant to Rule 457(h)(3), no additional fee is payable since these
shares, which may be offered for resale are the same shares being
registered hereby upon their initial issuance pursuant to the Plan.
1
<PAGE> 2
CHAD THERAPEUTICS, INC.
FORM S-8 REGISTRATION STATEMENT
CROSS-REFERENCE SHEET SHOWING LOCATION IN PROSPECTUS
OF INFORMATION REQUIRED BY ITEMS OF FORM S-3
<TABLE>
<CAPTION>
FORM S-3 REGISTRATION STATEMENT
ITEM AND HEADING HEADING IN PROSPECTUS
-------------------------------- ---------------------
<S> <C>
1. Forepart of the Registration Statement and
Outside Front Cover Page of Prospectus...... Facing Page; Cross Reference Sheet;
Outside Front Cover Page of Prospectus;
Additional Information
2. Inside Front and Outside Back Cover Pages
of Prospectus............................... Inside Front and Outside Back Cover Pages
of Prospectus
3. Summary Information, Risk Factors and Ratio
of Earnings to Fixed Charges................ The Company; Risk Factors
4. Use of Proceeds............................. Use of Proceeds
5. Determination of Offering Price............. Outside Front Cover Page of Prospectus
6. Dilution.................................... Not Applicable
7. Selling Security Holders.................... Selling Shareholders
8. Plan of Distribution........................ Outside and Inside Front Cover Pages of
Prospectus; Plan of Distribution
9. Description of Securities to be Registered.. Outside Front Cover Page of
Prospectus
10. Interests of Named Experts and Counsel...... Legal Matters
11. Material Changes............................ Recent Developments
12. Incorporation of Certain Information by
Reference................................... Available Information; Incorporation of
Certain Information by Reference
13. Disclosure of Commission's Position on
Indemnification for Securities Act
Liabilities................................. Not Applicable
</TABLE>
2
<PAGE> 3
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
The document(s) containing the information specified in this Part I will
be sent or given to participants in the Chad Therapeutics, Inc. Directors' Stock
Compensation Plan to which this Registration Statement relates, as specified by
Rule 428(b) promulgated under the Securities Act of 1933, as amended, and are
not filed as part of this Registration Statement.
3
<PAGE> 4
The Prospectus which follows is prepared in accordance with the
requirements of Part I of Form S-3 and is included herewith for potential use by
certain directors (the "Selling Shareholders") of Chad Therapeutics, Inc. (the
"Company") who have acquired, or may acquire, shares of common stock of the
Company (the "Shares") pursuant to the Chad Therapeutics, Inc. Directors' Stock
Compensation Plan (the "Plan"). However, the Selling Shareholders have no
intention of reselling their Shares at this time.
<PAGE> 5
PROSPECTUS
100,000 SHARES
CHAD THERAPEUTICS, INC.
COMMON SHARES, $.01 PAR VALUE
This Prospectus covers up to 100,000 shares of Common Stock, $.01 par
value (the "Shares") of Chad Therapeutics, Inc., a California corporation (the
"Company"). Such Shares have been or may be acquired by certain directors of the
Company (the "Selling Shareholders"), pursuant to the Chad Therapeutics, Inc.
Directors' Stock Compensation Plan (the "Plan"). Such Selling Shareholders may
be deemed to be affiliates of the Company. All expenses incurred in connection
with this offering will be borne by the Company.
The Company has been advised by the Selling Shareholders that they may
sell all or a portion of the Shares offered hereby from time to time on the
American Stock Exchange ("AMEX") at prices prevailing at the time of such sales.
The Selling Shareholders may also make private sales at negotiated prices
directly or through a broker or brokers. The Selling Shareholders and any broker
executing selling orders on behalf of the Selling Shareholders may be deemed to
be "underwriters" within the meaning of the Securities Act of 1933, as amended
(the "Act"), in which event commissions received by any such broker may be
deemed to be underwriting commissions under the Act.
The Common Stock is listed on the AMEX under the symbol "CTU." On April
9, 1999, the closing price of the Common Stock, as reported on the AMEX, was
$2.6875 per share.
--------------------
PROSPECTIVE PURCHASERS SHOULD CAREFULLY CONSIDER
THE MATTERS SET FORTH UNDER THE CAPTION "INVESTMENT CONSIDERATIONS."
--------------------
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 THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------------
The date of this Prospectus is April 13, 1999.
1
<PAGE> 6
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports and other information with the Securities
and Exchange Commission (the "Commission"). Reports, proxy statements and other
information filed by the Company can be inspected and copied at the Public
Reference Room maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C., 20549. Information on the operation of the Public Reference
Room may be obtained by calling the Commission at 1-800-SEC-0330. The Commission
also maintains an internet site at http://www.sec.gov that contains all
electronically filed reports, proxy and information statements and other
information regarding the Company.
This Prospectus constitutes part of a Registration Statement on Form
S-8 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company with the Commission under the Act. This
Prospectus omits certain of the information contained in the Registration
Statement, and reference is hereby made to the Registration Statement for
further information with respect to the Company and the Shares offered hereby.
Any statements contained herein concerning the provisions of any document filed
as an exhibit to the Registration Statement or otherwise filed with the
Commission are not necessarily complete, and in each instance reference is made
to the copy of such document as filed. Each such statement is qualified in its
entirety by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents and any amendments thereto filed by the Company
with the Commission under the Exchange Act are incorporated by reference in this
Prospectus: (i) the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1998; (ii) the Company's Quarterly Reports for the quarters
ended June 30, September 30 and December 31, 1998 on Form 10-Q; (iii) the
Company's Proxy Statement dated July 17, 1998 with respect to its Annual Meeting
of Shareholders held on September 15, 1998; (iv) all other reports filed by the
Company pursuant to Section 13(a) or 15(d) of the Exchange Act since March 31,
1998; and (v) the description of the Company's Common Stock as set forth in the
Registration Statement filed by the Company on Form 8-A pursuant to Section 12
of the Exchange Act, and any amendments or reports thereto filed with the
Commission for the purpose of updating such description.
All documents and any amendments thereto subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act
prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference and to be
a part of this Prospectus from the date of filing of such documents. Any
statement contained in a document incorporated by reference herein shall be
deemed to be modified or superseded for all purposes to the extent that a
statement contained in this Prospectus, or in any other subsequently filed
document which is also incorporated by reference, modifies or replaces such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
2
<PAGE> 7
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon written or oral request of such person, a copy of
any and all information incorporated by reference in this Prospectus (including
exhibits which are incorporated by reference in such information). Requests for
such copies should be directed to Earl L. Yager (i) if by telephone to (818)
882-0883, and (ii) if by mail, to 21622 Plummer Street, Chatsworth, California,
91311.
THE COMPANY
The Company was organized on August 17, 1982, to develop, produce and
market respiratory care devices designed to improve the efficiency of oxygen
delivery systems for both home and hospital treatment of patients who require
supplemental oxygen. The Company introduced its first respiratory care device in
the market in June 1983 and has introduced additional respiratory care devices
in subsequent years.
Recognizing the need for efficient oxygen delivery systems, the Company
has pursued, since its inception, the development and marketing of devices which
are designed to conserve oxygen. The benefits of such devices include
substantial cost savings and increased mobility for ambulatory patients who
require portable oxygen supplies. These devices extend the life of oxygen
supplies, make possible more compact and longer lasting portable systems and
thereby improve the quality of life for home oxygen patients. Examples of these
products include, OXYMIZER and OXYMIZER Pendant Oxygen-Conserving Devices,
OXYMATIC - 2400, OXYLITE Complete Portable Oxygen System, OXYCOIL Coiled Oxygen
Tubing and TOTAL O2 Delivery System. The technology for each of these devices
belongs to the inventors thereof and the Company has acquired exclusive licenses
to manufacture and market the products. The Company also offers a variety of
ancillary products which support the principal oxygen conserving products,
including oxygen cylinders of various sizes and compositions, regulators,
cannulas and connecting tubing and assorted carrying pouches.
The Company tests and packages its products in its own facility. Some
manufacturing processes are conducted by other firms and the Company expects to
continue using outside firms for certain manufacturing processes for the
foreseeable future. All outside manufacturing is conducted under the supervision
and control of the Company and with tooling provided by the Company.
The Company's products are designed to reduce the cost of health care
while maintaining or enhancing the therapeutic benefits to the patient and
improving the user's quality of life. The Company's marketing efforts have thus
focused primarily on providing home oxygen suppliers with products that they can
utilize to increase their revenues, while reducing their costs. The Company
markets its products directly to home oxygen suppliers throughout the United
States and through independent distributors in certain European and Asian
countries.
The Company's principal executive offices are located at 21622 Plummer
Street, Chatsworth, California, 91311, telephone (818) 882-0883.
3
<PAGE> 8
RECENT DEVELOPMENTS
On March 16, 1999, the Company announced the retirement of Frank
Fleming, Senior Vice President, effective March 31, 1999. Mr. Fleming will
become a consultant to the Company, primarily in the areas of marketing, sales
and government and industry affairs.
INVESTMENT CONSIDERATIONS
Prospective purchasers of the Shares should consider carefully the
matters described below before deciding to invest in the Shares.
1. DEPENDENCE UPON A SINGLE PRODUCT LINE
Although the Company currently markets a number of products, these
products comprise a single product line for patients requiring supplementary
oxygen. The Company's future performance is thus dependent upon developments
affecting this segment of the health care market and the Company's ability to
remain competitive within this market sector.
The Company's future growth in the near term will depend in significant
part upon the commercial success of the TOTAL O2 Delivery System. The success of
this new product will depend upon the health care community's perception of the
system's capabilities, clinical efficacy, reliability and benefit to patients.
In addition, prospective sales will be impacted by the degree of acceptance it
achieves among home oxygen dealers and patients requiring supplementary oxygen.
Although limited sales of the TOTAL O2 Delivery System have occurred, this
product has not yet achieved the degree of success anticipated by the Company.
As with the production of any new product, the Company's ability to successfully
promote the TOTAL O2 Delivery System cannot be assessed at this time.
2. CONSOLIDATION OF HOME CARE INDUSTRY
The home health care industry is undergoing significant consolidation.
As a result, the market for the Company's products is increasingly influenced by
major national chains. Three major national chains presently account for 24% of
the Company's domestic sales. Future sales may be increasingly dependent on a
limited number of customers which may have an impact on margins due to quantity
pricing.
3. COMPETITION
The Company's success over the past several years has drawn new
competition to vie for a share of the home oxygen market. These new competitors
include both small and very large companies. While the Company believes the
quality of its products and its established reputation will continue to be a
competitive advantage, some competitors have successfully introduced lower price
products which do not provide oxygen conserving capabilities comparable to the
Company's products. This has resulted in a decline in the number of oxygen
conservers sold by the Company and no assurance can be given that increased
competition in the home oxygen market will not continue to have an adverse
effect on the Company's operations.
4
<PAGE> 9
4. RAPID TECHNOLOGICAL CHANGE
The health care industry is characterized by rapid technological change.
The Company's products may become obsolete as a result of new developments. The
Company's ability to remain competitive will depend to a large extent upon its
ability to anticipate and stay abreast of new technological developments related
to oxygen therapy. The Company has limited internal research and development
capabilities. Historically, the Company has contracted with outside parties to
develop new products. Some of the Company's competitors have substantially
greater funds and facilities to pursue research and development of new products
and technologies for oxygen therapy.
5. POTENTIAL CHANGES IN ADMINISTRATION OF HEALTH CARE
During the past five years, a number of bills proposing to regulate,
control or alter the method of financing health care costs have been introduced
in Congress and various state legislatures. There are wide variations among
these bills and proposals. Because of the uncertain state of the health care
proposals, it is not meaningful at this time to predict the effect on the
business of the Company if any of these proposals is enacted.
Federal law has altered the payment rates available to providers of
Medicare services in various ways during the last several years. Congress has
passed legislation which would reduce Medicare spending. It cannot be predicted
how changes in reimbursement levels will affect the home oxygen industry and
there can be no assurance that such changes will not have an adverse effect on
the Company's business.
6. PATENTS AND TRADEMARKS
The Company pursues a policy of obtaining patents for appropriate
inventions related to products marketed or manufactured by the Company. The
Company considers the patentability of its products to be significant to the
success of the Company. To the extent that the products marketed by the Company
do not receive patent protection, competitors may be able to manufacture and
market substantially similar products. Such competition could have an adverse
impact upon the Company's business.
7. PRODUCTS LIABILITY
The nature of the Company's business subjects it to potential legal
actions asserting that the Company is liable for damages for product liability
claims. Although the Company maintains products liability insurance in an amount
which it believes to be customary in the industry, there is no assurance that
this insurance will be sufficient to cover the costs of defense or judgments
which might be entered against the Company. The type and frequency of these
claims could have an adverse impact on the Company's results of operations and
financial position.
8. AVAILABILITY OF THIRD PARTY COMPONENT PRODUCTS
The Company tests and packages its products in its own facility. Some of
its other manufacturing processes are conducted by other firms and the Company
expects to continue using outside firms for certain manufacturing processes for
the foreseeable future. From time to time the Company has experienced
reliability problems with components procured from certain vendors. The
Company's agreements with its suppliers are terminable at will or by notice. The
Company believes that other suppliers would be available in
5
<PAGE> 10
the event of termination of these arrangements or in the event a supplier's
products prove unreliable. No assurance can be given, however, that the Company
will not suffer a material disruption in the supply of its products.
9. ACCOUNTING STANDARDS
Accounting standards promulgated by the Financial Accounting Standards
Board change periodically. Changes in such standards may have an impact on the
Company's financial position.
10. ADDITIONAL INVESTMENT CONSIDERATIONS
Additional factors which might affect the Company's performance may be
listed from time to time in the reports filed by the Company with the Securities
and Exchange Commission.
USE OF PROCEEDS
If any of the Shares are resold by the Selling Shareholders, the Company
would receive no proceeds from any such sale. The Shares would be offered for
the respective accounts of the Selling Shareholders.
SELLING SHAREHOLDERS
The following table sets forth certain information as of the date of
this prospectus with respect to the Selling Shareholders. The address of each
Selling Shareholder is 21622 Plummer Street, Chatsworth, California, 91311.
<TABLE>
<CAPTION>
NUMBER OF SHARES TO BE BENEFICIALLY
NAME OF SHARES OWNED AFTER SALE(1)
BENEFICIAL BENEFICIALLY SHARES TO ----------------------------
OWNER OWNED(1)(2) BE SOLD NUMBER PERCENT(3)
---------- ----------- --------- ------ ----------
<S> <C> <C> <C> <C>
Norman Cooper, 84,055
Director
Philip Wolfstein, 159,933
Director
David L. Cutter, 79,553
Director
</TABLE>
- ----------
(1) Unless otherwise indicated, each individual has sole voting and
investment power with respect to all shares owned by such individual.
(2) Shares shown in this column include Common Shares currently owned as a
result of shares of Common Stock issuable pursuant to presently
exercisable options and shares of Common Stock issuable pursuant to
options which are exercisable within 60 days of the date of this
Prospectus.
(3) Based upon ______________ Common Shares outstanding as of ________ __,
____, plus Common Shares issuable pursuant to options held by the
particular Selling Shareholder. Percentages shown after sale are based
upon all shares registered hereunder being sold. Asterisks denote
ownership of less than one percent.
6
<PAGE> 11
PLAN OF DISTRIBUTION
The Company has been advised by the Selling Shareholders that they
intend to sell all or a portion of the Shares offered hereby from time to time
on the AMEX and that such sales will be made at prices prevailing at the times
of such sales. The Selling Shareholders may also make private sales directly or
through a broker or brokers. The Selling Shareholders will be responsible for
payment of any and all commissions to brokers, which will be negotiated on an
individual basis. In connection with any sales, the Selling Shareholders and any
brokers participating in such sales may be deemed to be underwriters within the
meaning of the Act.
The Company has informed the Selling Shareholders that the
anti-manipulative rules set forth in Regulation M of the Exchange Act may apply
to their sales in the market and has furnished each Selling Shareholder with a
copy of these rules.
There is no assurance that any of the Selling Shareholders will sell any
or all of the shares of Common Stock offered by them.
The Company will pay all expenses incident to the offering and sale of
the Common Stock to the public other than brokerage commissions which will be
paid by the Selling Shareholders.
LEGAL MATTERS
Graham & James LLP, counsel to the Company, has rendered an opinion to
the Company that the Common Stock offered hereby will be duly and validly
issued, fully paid and non-assessable. Hillel T. Cohn, a partner of Graham &
James LLP, owns 4,200 shares of Common Stock of the Company.
EXPERTS
The financial statements of Chad Therapeutics, Inc. as of March 31, 1998
and 1997, and for each of the years in the three-year period ended March 31,
1998, have been incorporated by reference herein and in this Prospectus in
reliance upon the report of KPMG LLP, independent certified public accountants,
incorporated by reference herein, and upon the authority of said firm as experts
in accounting and auditing.
7
<PAGE> 12
================================================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED IN
CONNECTION WITH THIS OFFERING TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS (INCLUDING ANY
PROSPECTUS SUPPLEMENT) IN CONNECTION WITH THE OFFER MADE HEREBY. IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY, BY ANY UNDERWRITER OR BY THE SELLING SHAREHOLDERS.
THIS PROSPECTUS (INCLUDING ANY PROSPECTUS SUPPLEMENT) DOES NOT CONSTITUTE AN
OFFER OR A SOLICITATION IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH AN OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE CIRCUMSTANCES OF THE COMPANY OR
THE FACTS HEREIN SET FORTH SINCE THE DATE HEREOF.
----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information .................................................... 2
Incorporation of Certain
Information by Reference ............................................... 2
The Company .............................................................. 3
Recent Developments ...................................................... 4
Investment Considerations ................................................ 4
Use of Proceeds .......................................................... 6
Selling Shareholders ..................................................... 6
Plan of Distribution ..................................................... 7
Legal Matters ............................................................ 7
Experts .................................................................. 7
</TABLE>
----------
CHAD THERAPEUTICS, INC. HAS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, WASHINGTON, D.C., A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OF 1933 WITH RESPECT TO THE SHARES OFFERED HEREBY.
THIS PROSPECTUS OMITS CERTAIN INFORMATION CONTAINED IN THE REGISTRATION
STATEMENT. THE INFORMATION OMITTED MAY BE OBTAINED FROM THE SECURITIES AND
EXCHANGE COMMISSION UPON PAYMENT OF THE REGULAR CHARGE THEREFOR.
================================================================================
================================================================================
CHAD THERAPEUTICS, INC.
100,000 SHARES
OF COMMON STOCK,
$.01 PAR VALUE
--------------
PROSPECTUS
--------------
APRIL 13, 1999
================================================================================
<PAGE> 13
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, and any amendments thereto, filed by Chad
Therapeutics, Inc. (the "Company" or the "Registrant") with the Securities and
Exchange Commission are incorporated by reference in this Registration Statement
and shall be deemed to be a part hereof from the date of filing such documents.
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1998;
(b) The Company's Quarterly Reports for the quarters ended June 30,
September 30 and December 31, 1998 on Form 10-Q;
(c) The Company's Proxy Statement dated July 17, 1998 with respect to
its Annual Meeting of Shareholders held on September 15, 1998;
(d) All other reports filed by the Company pursuant to Section 13(a)
or 15(d) of the Exchange Act since March 31, 1998;
(d) The description of the Company's Common Stock as set forth in the
Registration Statement filed by the Company on Form 8-A pursuant
to Section 12 of the Exchange Act, and any amendments or reports
thereto filed with the Commission for the purpose of updating
such description; and
(e) All documents filed by the Company pursuant to Sections 13, 14,
or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of the offering of the Common Stock
made hereby shall be deemed to be incorporated in this Prospectus
by reference and to be a part hereof from the date of filing of
such documents, except as to any portion of any future Annual or
Quarterly Report to the Shareholders which is not deemed to be
filed under said provisions.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
The Company's Articles of Incorporation, as amended, and the Company's
Bylaws provide that the corporation shall indemnify any person who was, or is, a
party to a proceeding by reason of the fact that he was, or is, an agent of the
Company, to the fullest extent permissible under California law and empowers the
Company to purchase and maintain insurance on behalf of any such person. Section
317 of the California Corporations Code (the "Code") empowers a corporation to
indemnify any such person against liability incurred in connection with such
proceeding. Such person must have acted in good faith and in a manner reasonably
believed to be in the best interests of the corporation. With respect to any
criminal proceedings, such person must have had no reasonable cause to believe
his conduct was unlawful. Any such indemnification may be made to the extent
such agent has been successful on the merits in defense of any such proceeding,
or upon a determination by the corporation that such indemnification is proper
because the person met the applicable standard of conduct. Pursuant to Section
204(a)(11) of the Code, the indemnification authorized by Section 317 is not to
be deemed exclusive of any additional rights to indemnification to the extent
such rights are authorized in the articles of incorporation. Section 204(a)(11)
of the Code permits the articles of incorporation
4
<PAGE> 14
to provide for the indemnification of agents in excess of that expressly
permitted by Section 317; provided, however, that indemnification may not be
granted for any acts from which a director may not be relieved of liability as
set forth in Section 204(a)(10) or as expressly prohibited by Section 317 of the
Code.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
<TABLE>
<CAPTION>
Exhibit
Number Description
------ -----------
<S> <C>
5 Opinion of Graham & James LLP
23(a) Consent of KPMG LLP
23(b) Consent of Graham & James LLP (included in Exhibit 5)
24 Power of Attorney (included on the signature page)
</TABLE>
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to include any material
information with respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such information in the
Registration Statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
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
Exchange Act that is incorporated by reference in the Registration Statement
shall be deemed to be a new Registration Statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company has been
advised that in the opinion of the 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 Company of expenses incurred or paid by a director, officer, or
controlling person of the Company 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 Company 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.
5
<PAGE> 15
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 Chatsworth, State of California, on this 25th
day of March, 1999.
CHAD THERAPEUTICS, INC.
By: /s/ THOMAS E. JONES
-----------------------------------------
Thomas E. Jones, Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Earl L. Yager as his attorney-in-fact, with the
power of substitution for him in any and all capacities, to sign any amendments
to this Registration Statement, including post-effective amendments, and to file
the same, with exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, hereby ratifying and confirming all
that said attorney-in-fact, or his substitute or substitutes, may do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ THOMAS E. JONES Chief Executive Officer, March 25, 1999
----------------------- President and Director
Thomas E. Jones (Principal Executive Officer)
/s/ FRANCIS R. FLEMING Senior Vice President and March 25, 1999
----------------------- Director
Francis R. Fleming
/s/ EARL L. YAGER Executive Vice President, March 25, 1999
----------------------- Chief Financial Officer and
Earl L. Yager Secretary and Director
(Principal Financial and
Accounting Officer)
/s/ CHARLES R. ADAMS Chairman of the Board March 25, 1999
-----------------------
Charles R. Adams
</TABLE>
6
<PAGE> 16
<TABLE>
<S> <C> <C>
_______________________ Director ___________ __, 1999
David L. Cutter
_______________________ Director ____________ __, 1999
John C. Boyd
_______________________ Director ____________ __, 1999
Norman Cooper
/s/ PHILIP WOLFSTEIN Director April 12, 1999
-----------------------
Philip Wolfstein
</TABLE>
7
<PAGE> 17
EXHIBIT INDEX
<TABLE>
<CAPTION>
NUMBER EXHIBIT
------ -------
<S> <C>
5 Opinion of Graham & James LLP
23.1 Consent of KPMG LLP
23.2 Consent of Graham & James LLP (included in Exhibit 5)
24 Power of Attorney (included on the signature page)
</TABLE>
8
<PAGE> 1
EXHIBIT 5
[GRAHAM & JAMES LLP LETTERHEAD]
April 9, 1999
The Board of Directors
Chad Therapeutics, Inc.
21622 Plummer Street
Chatsworth, CA 91311
RE: FORM S-8/S-3 REGISTRATION STATEMENT
Ladies and Gentlemen:
We have acted as counsel to Chad Therapeutics, Inc., a California
corporation (the "Company"), in connection with the preparation and filing by
the Company of a registration statement on Form S-8/S-3 (the "Registration
Statement") to be filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, relating to a Directors' Stock Compensation
Plan (the "Plan") pursuant to which the Company may issue up to 100,000 shares
of Common Stock of the Company, $.01 par value (the "Shares") to directors
("Receiving Shareholders") in lieu of cash as consideration for bona fide
services rendered by the Receiving Shareholders as directors of the Company.
We have reviewed (i) the Articles of Incorporation of the Company, as
amended (ii) the By-Laws of the Company, as amended (iii) the Minutes of Meeting
of Board of Directors of the Company dated January 11, 1999; (iv) an Officer's
Certificate executed by Earl L. Yager, Secretary of the Company, (v) a Good
Standing Certificate of the Company dated March 31, 1999, (vi) the Plan and
(vii) the Registration Statement (including exhibits thereto). We have also made
such inquiries and have examined originals, certified copies or copies otherwise
identified to our satisfaction of such documents, corporate records and other
instruments as we have deemed necessary or appropriate for the purposes of this
opinion.
In our examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such documents. For the purpose of rendering
this opinion, we have further assumed the truth, accuracy and completeness of
all of the representations and other factual statements contained in such
documents. We have not undertaken any independent investigation to determine the
truth, accuracy or completeness
<PAGE> 2
The Board of Directors of
Chad Therapeutics, Inc.
April 9, 1999
Page 2
of any of such factual information, although nothing has come to our attention
that leads us to believe that any such information is incorrect.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Company has been duly organized and is a corporation in good
standing under the laws of the State of California.
2. The Shares have been duly and validly authorized, and when issued,
will be validly issued, fully paid and non-assessable.
We are members of the Bar of the State of California. Our opinions are
limited to matters involving the federal laws of the United States and the laws
of the State of California and we do not express any opinion as to the laws of
any other jurisdiction. The information set forth in this letter is as of the
date of this letter and we disclaim any undertaking to advise you of changes
which may thereafter be brought or come to our attention. This opinion is
rendered solely for your benefit and may not be relied upon by any other person
or entity or for any purpose without our prior written consent in each instance.
We consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference therein to the firm under the
caption "Legal Matters."
Sincerely,
/s/ GRAHAM & JAMES LLP
GRAHAM & JAMES LLP
Our File: 16206.00001
<PAGE> 1
EXHIBIT 23.1
[KPMG LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Chad Therapeutics, Inc.:
We consent to the use of our reports incorporated herein by reference and to
the reference to our firm under the heading "Experts" in the registration
statement.
/s/ KPMG LLP
Los Angeles, California
April 5, 1999
