2
PROSPECTUS
2,000,000 Shares
IMATRON INC.
Common Stock No Par Value
--------------------
All of the 2,000,000 shares of Common Stock offered hereby are being sold
by Imatron Inc. (the "Company" or "Imatron"). The Company's Common Stock is
traded over-the-counter on the NASDAQ National Market System under the symbol
"IMAT." On January 23, 1996 the last reported sale price of the Common Stock was
$1.91 per share.
--------------------
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK.
SEE "RISK FACTORS."
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
- ------------------------------------------------------------------------------
Price to Public Commissions Proceeds to Company(1)
Per Share $1.91 $0.13 $1.78
Total $3,820,000 $267,400 $3,552,600
- ------------------------------------------------------------------------------
1 Before deduction of offering expenses, which are not expected to exceed
$11,748, payable by the Company.
The Date of this Prospectus is March 21, 1996
<PAGE>
TABLE OF CONTENTS
AVAILABLE INFORMATION..................................................... 3
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE........................... 3
THE COMPANY............................................................... 4
RISK FACTORS.............................................................. 5
USE OF PROCEEDS........................................................... 11
PRICE RANGE OF COMMON STOCK............................................... 12
PLAN OF DISTRIBUTION...................................................... 12
EXPERTS................................................................... 13
LEGAL OPINION............................................................. 13
<PAGE>
AVAILABLE INFORMATION
Imatron Inc. ("Imatron" or the "Company") is subject to the
informational requirements of the Securities and Exchange Act of 1934, as
amended (the "Exchange Act"), and, in accordance therewith, files reports, proxy
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy statements and other information filed
by the Company with the Commission can be inspected and copied at Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549, and at the Regional Offices of the
Commission at Room 1204, Everett McKinley Dirksen Building, 219 South Dearborn
Street, Chicago, Illinois 60604; and Room 1102, 26 Federal Plaza, New York, New
York 10007. Copies of such material can be obtained from the Public Reference
Section of the Commission, at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. Shares of the Company's Common Stock are traded on the NASDAQ
National Market System under the symbol "IMAT." Information concerning the
Company may also be obtained by contacting NASDAQ/NMS.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year ended December
31, 1994, filed April 11, 1995 (File No. 0-12405) and all amendments thereto;
the Company's definitive Proxy Statement filed pursuant to Section 14 of the
Exchange Act in connection with the annual meeting of shareholders held on June
2, 1995, filed May 1, 1995; the Company's Quarterly Reports on Form 10-Q for the
periods ending March 31, 1995, June 30, 1995, and September 30, 1995 filed on
May 12, 1995, August 14, 1995 and November 14, 1995, respectively; and the
description of the Company's Common Stock contained in a registration statement
filed under the Exchange Act, including any amendment or report filed for the
purpose of updating such description, are hereby incorporated by reference into
this Prospectus. All documents filed by the Company with the Commission pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of the offering of Common Stock shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents, except the Board Compensation
Committee Report on Executive Compensation and the Performance Graph included in
the Proxy Statement pursuant to Item 402(k) and (l) of Regulation S-K. Any
statement contained in a document incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus. The Company will provide without charge to each person,
including any beneficial owner, to whom this Prospectus is delivered, upon
written or oral request of such person, a copy of any and all of the information
that has been incorporated by reference in this Registration Statement filed
with the Commission under the Exchange Act with respect to the Common Stock
offered by the Prospectus, other than certain exhibits to such documents. Such
requests should be directed to the Chief Financial Officer, Imatron Inc., 389
Oyster Point Boulevard, South San Francisco, California 94080, telephone no.
(415) 583-9964.
<PAGE>
THE COMPANY
Imatron is a technology-based company principally engaged in the
business of designing, manufacturing, and marketing a high performance computed
tomography (CT) scanner that uses a scanning electron beam. CT refers to a
diagnostic imaging device in which cross-sectional (tomographic) images of a
patient's anatomy are acquired from multiple intensity readings taken as an
x-ray source rotates around the patient. Ultrafast CT technology is more than 20
times faster than conventional computed tomography, enabling users to perform
certain tests involving organs in motion (e.g. the heart) that no other medical
imaging equipment is able to perform.
For over a decade, the scanner has been used in large and mid-sized
hospitals and free standing imaging clinics. The Company also provides service,
parts, and maintenance to hospitals and clinics that operate its scanners. The
technological advantage provided by high-speed tomography now provides Imatron
the opportunity to develop a new and additional market, by performing simple,
low cost, non-invasive screening to detect the earliest signs of heart disease
by means of the Coronary Artery Scan ("CAS"). This vast new market involves
activity in both diagnostic services and equipment manufacturing.
The Company is also engaged in the related businesses of performing
research and development for itself and others in the field of CT devices and of
licensing its patents and know-how in the field of imaging sciences.
Imatron was incorporated in New Jersey in February, 1983. Its executive
offices are located at 389 Oyster Point Boulevard, South San Francisco,
California 94080, and its telephone number is (415) 583-9964.
In 1993, Imatron organized HeartScan Imaging, Inc. as a wholly-owned
subsidiary to develop and operate a network of company-owned coronary artery
disease risk assessment centers in cooperation and conjunction with the
established medical (primarily cardiology) community in specific metropolitan
areas. In that same year, HeartScan opened a test facility adjacent to Imatron's
headquarters. In July, 1995, it opened its first coronary artery disease risk
assessment center in Seattle, Washington. In January, 1995, it opened its second
facility in Houston, Texas. It plans to open similar facilities in Washington,
D.C. and Pittsburgh, Pennsylvania, in May, 1996. HeartScan's centers deliver the
CAS diagnostic test together with other risk factor tests in a manner consistent
with established channels of patient referral, as well as with the new channels
of patient referral being created by health care reform and the growth of
managed-care systems.
A significant component of HeartScan's approach is to offer the CAS
procedure and a full battery of coronary artery disease risk assessment testing
to consumers without necessarily requiring a physician's referral, an approach
designed to result in more rapid acceptance of the test and a shorter return on
the investment cycle. This is achieved by means of two broad and mutually
<PAGE>
supportive approaches - increasing the number of coronary artery disease risk
assessment centers in operation, which in turn, both directly and indirectly,
increases the demand for Imatron's C-150/Evolution scanner currently in
distribution. HeartScan management believes that the market for coronary artery
disease risk assessment centers is very large and that HeartScan's comprehensive
heart disease screening approach is both revolutionary and highly effective.
HeartScan Imaging, Inc. was incorporated in Delaware in March, 1993. Its
executive offices are currently co-located with those of Imatron Inc. at 389
Oyster Point Boulevard, South San Francisco, California 94080, and its telephone
number is (415) 583-9964.
RISK FACTORS
The securities offered hereby are speculative and involve a high degree
of risk. Prospective investors may lose all or a part of their investment.
Consequently, the following factors, in addition to the other information
contained in this Prospectus, should be considered carefully in evaluating the
Company and its business before purchasing the securities offered hereby:
Short Operating History. Imatron was incorporated in February, 1983 and
in March, 1983 became the successor to Imatron Associates, a limited partnership
established in February, 1981. Imatron operated as a development-stage company
until the fourth quarter of 1984, at which time it recognized its initial sale
of an ULTRAFAST CT(R) scanner. Imatron incurred losses each quarter from
inception in February, 1981 through December 31, 1990. Its first recorded
profitable year was the year ended December 31, 1991 during which a $4,000,000
payment for the licensing of technology to Siemens Corporation was received. The
Company incurred net losses of $2,871,000 and $6,523,000 in the years ended
December 31, 1993 and 1992, respectively. 1994 was the Company's first year of
profit from operations. Through September 30, 1995, the Company incurred a net
loss of $297,000. There is no assurance that Imatron can operate profitably in
the future. In the past, Imatron has funded its losses primarily through the
sale of securities in two public offerings and a number of private placements,
through the exercise of options and warrants, through the 1991 license for
medical uses of its electron-beam technology to Siemens Corporation, and through
revolving lines of credit. Recently, the Company raised $9,957,700 in two
offerings of Common Stock to certain institutional investors.
Need for Additional Financing. To satisfy the Company's future capital
and operating requirements, profitable operations or additional public or
private financing will be required. If future public or private financing is
required by the Company, holders of the Company's securities may experience
dilution. If such financing cannot be obtained, the Company may seek to sell or
license additional portions of its technology, to sell some or all of its other
assets or to merge with another company. In addition, HSI will need substantial
additional financing to fund its plan to own and operate CAS clinics. To date
HSI has been unable to raise such funds and has relied upon the Company for
financing. In the event HSI cannot raise such funds it will have to curtail its
expansion activities.
<PAGE>
Material Dependence Upon Key Personnel. The Company has been and will
continue to be materially dependent upon the technical expertise of its
engineering management personnel. The loss of a significant number of such
personnel would have a materially adverse effect upon the Company's business and
future prospects. The Company does not maintain key-man life insurance.
High Cost of Scanner. The distributor list price of Imatron's ULTRAFAST
CT scanner is significantly higher than that of commercially available
conventional CT scanners and higher than the price of "top-of-the-line"
scanners. Such pricing may limit the market for Imatron's product. Potential
customers' budgetary limitations, including those imposed by government
regulation, may often compel the purchase of lower cost, conventional CT
scanners.
Limited Clinical Demonstration of Certain Advantages of Company's
Scanner. The Company's scanners have been used in a clinical environment on
humans since April, 1983. Clinical use of a scanner containing the new features
of the C-150 model began in August, 1992, and 47 C-150 scanners are currently
installed in a clinical setting. Imatron's worldwide installed base consists of
62 CT scanners. The Company believes that market acceptance of the ULTRAFAST CT
scanner continues to depend in substantial part upon the clinical demonstration
of certain asserted technological advantages and diagnostic capabilities. There
is no assurance that these advantages will result in the development of a
significant market for the ULTRAFAST CT that will allow the Company to operate
profitably.
Product Liability Risks. As a manufacturer and marketer of medical
diagnostic equipment, the Company is subject to potential product liability
claims. For example, the exposure of normal human tissue to x-rays, which is
inherent in the use of CT scanners for diagnostic imaging, may result in
potential injury to patients, thereby subjecting the Company to possible
liability therefor. The Company presently maintains primary and excess product
liability insurance with aggregate limits of $5,000,000 per occurrence. No
assurance can be given that the Company's product liability insurance coverage
will continue to be available or, if available, that it can be obtained in
sufficient amounts or at reasonable cost or that it will prove sufficient to pay
any claims that may arise.
Reliance on Product Development. Imatron continually seeks to develop
product enhancements and improve product reliability. Imatron's future success
may depend on its ability to complete certain product enhancement and product
reliability projects currently in progress, as well as on its continued ability
to develop new products or product enhancements in response to new products that
may be introduced by other companies. There can be no assurance that Imatron
will be able to continue to improve product reliability, or introduce new
product models or product enhancements as required to remain competitive.
Reliance on Patents and Proprietary Technology. Imatron relies heavily
on proprietary technology. Imatron is the exclusive sublicensee under one patent
<PAGE>
expiring in 1999 held by the University of California ("UC") relating to the
general concept of the ULTRAFAST CT scanner. Imatron holds the exclusive rights
under the patent pursuant to a sublicensee agreement with Emersub, Inc. (the
"Sublicensor"), a wholly owned subsidiary of Emerson Radio Corp., a former
principal shareholder of Imatron. Pursuant to the sublicense agreement, Imatron
is obligated to pay to the Sublicensor a continuing royalty of 2.125% of sales
of products utilizing the technology (2.0% of which would be paid by the
Sublicensor to UC). Loss by Imatron of its rights under the patent as a result
of termination of its sublicense from the Sublicensor, or the underlying
license, could have a material adverse effect upon Imatron's business and future
prospects. There are no present disputes with either UC or the Sublicensor. In
March, 1995, the Company entered into a Memorandum of Understanding (the "MOU")
with Siemens Corporation ("Siemens"). Pursuant to the terms of the MOU, the
Company transferred all of its interest in five United States patents and all
foreign corresponding patents to Siemens in exchange for cancellation of a loan.
Imatron retained a non-exclusive irrevocable and perpetual royalty-bearing
license under the transferred patents.
In addition, Imatron holds 27 U.S. patents of its own and has filed 3
U.S. patent applications covering various integral elements of the scanner,
including, among others, its X-ray detector and its electron beam assembly.
Imatron has filed applications corresponding to several of the U.S. applications
in various European Patent Convention countries, Canada and Japan. There can be
no assurance that any such applications will result in the issuance of any
patents to Imatron. Imatron's patents and patent applications have not been
tested in litigation and no assurance can be given that patent protection will
be upheld or will be as extensive as claimed. Furthermore, no assurance can be
given as to Imatron's ability to finance litigation against parties which may
infringe upon such patents or defend litigation against Imatron by parties which
may claim that Imatron's scanner infringes upon their patents.
In the event some or all of the Company's patent applications are
denied and/or some or all of its patents are held invalid, the Company would be
prevented from precluding its competitors from using the protected technology
set forth in such patent applications or patents. Because the Company's products
involve confidential proprietary technology and know-how, the Company does not
believe such a loss of patent rights would have a material adverse effect upon
the Company.
Limited or Single Sources of Supply. The Company manufactures its
scanners at its South San Francisco, California facility. To date the typical
manufacturing cycle has required at least four months. Based on inventory, lead
time can be significant between the receipt of an order and the shipment of a
scanner.
Many of the components and sub-assemblies used in the scanner have been
developed and designed by Imatron to its custom specifications and are
obtainable from limited or single sources of supply. In view of the customized
nature of many of these components and sub-assemblies, there may be long lead
times between order and shipment of scanners. Delays in delivery of components
and sub-assemblies could adversely affect Imatron's present and future
production schedules. The Company has made and continues to make inventory
investments to acquire long lead time components and sub-assemblies to minimize
the impact of such delays.
<PAGE>
Disruption or termination of limited or sole sources of supply could
have a temporary adverse effect on the Company's ability to meet scheduled
delivery dates. In recent years, the Company has developed alternative sources
for many of its scanner subcomponents and continues its programs to qualify
vendors for the remaining critical parts.
Food and Drug Administration and Other Governmental Regulation.
Amendments to the Federal Food, Drug, and Cosmetic Act ("Amendments") enacted in
1976, and regulations issued or authorized thereunder, provide for regulation by
the Federal Food and Drug Administration ("FDA") of the marketing, manufacture,
labeling, packaging, sale and distribution of "medical devices," including the
Company's scanner. Among these regulations are requirements that medical device
manufacturers register their manufacturing facilities with the FDA, list devices
manufactured by them, file various reports and comply with specified "Good
Manufacturing Practice" (GMP) regulations. The FDA enforces additional
regulations regarding the safety of equipment utilizing x-rays, including CT
scanners. Various states also impose similar regulations.
The Amendments also impose certain requirements which must be met prior
to the initial marketing of certain medical devices introduced into commerce
after May 28, 1976. These range from a minimum obligation to wait 90 days after
notification to the FDA before introduction of medical devices substantially
equivalent to devices on the market prior to May 28, 1976, to a maximum
obligation to comply with the potentially expensive and time-consuming process
of obtaining FDA authorization prior to the commercial marketing of new medical
devices. The Company has received appropriate clearances from the FDA to market
both the C-100 XL and C-150 ULTRAFAST CT scanner and believes that it is
presently in substantial compliance with the GMP requirements and other
regulatory issues promulgated by the FDA.
The FDA, through its Center for Devices and Radiological Health (the
"Center"), also regulates the safety and efficacy of radiological devices.
Although the Company believes it is in compliance with all applicable
radiological health standards and regulations promulgated by the Center, there
can be no assurance that the ULTRAFAST CT scanner will continue to comply with
all such standards and regulations that may be promulgated. In any event,
compliance with all such requirements can be costly and time consuming, with a
resultant materially adverse effect upon the development of the Company's
business and its future profitability.
FDA clearance to market does not guarantee or imply reimbursement by
third party payers such as Medicare, Medicaid, Blue Cross/Blue Shield or private
health insurers. Medicare and Medicaid reimburse for procedures that are
generally accepted or that have been proven safe and effective. The Health Care
Financing Administration ("HCFA"), which oversees Medicare and Medicaid, will
not authorize payment for procedures which are considered to be experimental.
HCFA has determined that diagnostic examinations of the head and other parts of
the body performed by CT scanners are covered if the contractor who administers
<PAGE>
the local Medicare program finds that medical and scientific literature and
opinion support the effective use of a scan for the particular condition.
The Federal government and certain states have enacted cost-containment
measures such as the establishment of maximum fee standards in an attempt to
limit the extent and cost of governmental reimbursement of allowable medical
expenses under Medicare, Medicaid and similar governmental programs. A number of
states have adopted or are considering the adoption of similar measures. Such
limitations have led to a reduction in, and may further limit funds available
for the purchase of diagnostic equipment such as the Company's scanner and in
the number of diagnostic imaging procedures performed in hospitals and other
medical institutions such as imaging clinics.
Federal legislation also requires states participating in Federal
medical expense reimbursement and funding programs to adopt requirements that
hospitals and other health care facilities, such as imaging clinics, obtain a
Certificate of Need ("CON") for major capital expenditures, in the absence of
which they will be denied reimbursement for services and funding relating to
such capital expenditures. A number of states have enacted CON legislation
beyond Federal requirements, such as requiring private physicians to obtain a
CON for any CT scanner, regardless of cost. There can be no assurance that
Imatron's potential customers will be able to secure CON's or will be willing to
pursue the application procedure.
The health care industry is highly regulated. The implementation of
certain health care reforms currently being considered by the executive and
legislative branches of the federal government may directly affect the Company's
business. Both existing and future governmental regulations could adversely
impact the market for the Company's ULTRAFAST CT scanner and the Company's
business. The Company's operations are also subject to regulation by other
federal, state and local governmental entities empowered to enforce pertinent
statutes and regulations, such as those enforced by the Occupational Safety and
Health Agency and the Environmental Protection Agency. In some cases state or
local regulations may be stricter than regulations imposed by the federal
government. The Company was most recently inspected by the State of California
Department of Occupational Safety and Health Administration in November, 1993.
Minor violations were identified by Cal/OSHA and were immediately corrected by
the Company. Follow up inspection by Cal/OSHA yielded satisfactory results
without issuance of further notice of violation. The Company believes it is in
substantial compliance with California regulations.
Volatility of Stock Price. The market prices for securities of advanced
technology companies have historically been highly volatile, including the
market price of shares of the Company's Common Stock. Future announcements by
the Company or its competitors, including announcements concerning technological
innovations or new commercial products, results of clinical testing, changes in
government regulations, regulatory actions, health care reform, proprietary
rights, litigation and public concerns as to the safety of the Company's or its
collaborators' products, as well as period-to-period variances in financial
results could cause the market price of the Common Stock to fluctuate
substantially. In addition, the stock market has experienced extreme price and
<PAGE>
volume fluctuations that have particularly affected the market price for many
advanced technology companies that have often been unrelated to the operating
performance of these companies. These broad market fluctuations may adversely
affect the market price of the Common Stock.
Competition. The Company competes with a number of other diagnostic
imaging equipment manufacturers. The Company's principal competition is from
current manufacturers of conventional CT scanners, including General Electric
Company, Siemens Corporation, Elscint, Picker International, Inc., Philips
Electronics, B.V., and Toshiba Corporation. Non-invasive diagnostic imaging
techniques such as ultrasound, radioisotope imaging, digital subtraction
angiography and magnetic resonance imaging are also partially competitive with
the Company's scanners, particularly in the cardiac imaging market. Each of the
companies named above markets equipment using one or more of these techniques.
All of these companies have greater financial resources and larger and more
established staffs than those of the Company and their products are in most
cases substantially less expensive than the ULTRAFAST CT scanner.
The Company believes that to compete successfully against these
competitors, it must demonstrate that the ULTRAFAST CT scanner is both an
acceptable substitute for conventional CT scanners in scanning areas of the body
where motion is not a limitation and a valuable cardiac diagnostic tool capable
of producing useful images of the heart. Although the Company believes that the
ULTRAFAST CT can produce images of a quality and resolution as good as or
superior to images produced by state-of-the-art conventional CT scanners, it
lacks certain features that many competing premium scanners offer. These include
lack of a high-resolution mode for imaging the temporal bones and inner ear and
lower functionality in software used for automatically positioning the patient.
There is no certainty that potential purchasers of the Company's scanner will
accept it without such features.
Also, the Company believes that customers and potential customers
expect a continuing development effort to improve the functionality and features
of the scanner. The Company continually seeks to develop product enhancements
and improve product reliability. Imatron's future success may depend on its
ability to complete certain product enhancement and product reliability projects
currently in progress, as well as on its continued ability to develop new
products or product enhancements in response to new products that may be
introduced by other companies. There can be no assurance that Imatron will be
able to continue to improve product reliability or introduce new product models
or product enhancements as required to remain competitive.
Other factors, in addition to those described above, that a potential
purchaser would consider in the decision to replace a conventional CT scanner
with an ULTRAFAST CT scanner include purchase price, patient throughput
capacity, anticipated operating expenses, estimated useful life and post-sale
customer service and support. The Company believes that its scanner and/or the
Company is competitive with respect to each of these factors.
Agreements with Siemens Corporation. In March, 1991, the Company
<PAGE>
entered into several related agreements with Siemens Corporation ("Siemens").
These agreements and the Company's relationship with Siemens were substantially
restructured in March, 1995. The Company transferred all of its interest in five
patents subject to a royalty-bearing license back in exchange for cancellation
of a loan. The parties also substituted for the existing Development Agreement a
collaborative research agreement pursuant to which they will jointly conduct
research and development over a three-year period to improve the Company's C-150
product. Siemens was appointed the Company's exclusive distributor for the C-150
scanner in the United States, Canada, Europe and India. The Company retains
exclusive distribution rights in the rest of the world. The Company and Siemens
also granted reciprocal licenses to each other covering electron beam technology
relating to the design and manufacture of electron beam products. Siemens has
recently asserted a claim against the Company regarding the lapse of certain
foreign registrations of one of the patents assigned to Siemens by the Company
in connection with the March 31, 1995 agreement between the companies. The
technology involved in the patent is not used presently in any of the Company's
products. In the Company's opinion, the resolution of this claim is not expected
to have a material effect on the financial position of the Company, but it could
be material to the net income of a particular future quarter (or year), if
resolved unfavorably.
Reliance on Distributors. A substantial portion of the Company's sales
of its scanners is done through distributors. There is no assurance that the
Company's distributors will actually meet their contractual minimums on a timely
basis. Failure by the distributors to meet their obligations could adversely
affect the Company.
No Dividends on Preferred and Common Stock. The Company has not paid
any dividends on its Preferred or Common Stock since inception. Even if its
future operations result in revenues and/or profitability, as to which there can
be no assurance, there is no present anticipation that dividends will be paid.
Rather, the Company expects that any future earnings will be applied toward the
further development of the Company's business.
USE OF PROCEEDS
The proceeds to be received by the Company from the sale of the
2,000,000 shares of Common Stock offered by the Company hereby, based on the
assumed public offering price of $1.91 per share, will be $3,820,000, less
payment of any commissions and other expenses of the offering, which are
expected to be approximately $279,148. While Imatron currently has no
commitments for use of the net proceeds of the offering, it anticipates that the
proceeds will be used in several main areas, including the development of
domestic and international markets ($500,000), the establishment of clinical
research and customer demonstration facilities ($1,000,000), advances to its
subsidiary HeartScan Imaging, Inc. to finance HeartScan's operations pending
completion of that company's current round of financing ($1,053,000), the
expansion of clinical research programs, and the development of clinical
applications for its products ($1,000,000) (all amounts are approximations). If
substantially less than the maximum proceeds are obtained, the Company will
apply the proceeds toward those uses in the order of priority in which they are
set forth in the preceding sentence. To the extent that the proceeds of the
<PAGE>
offering are not used for these purposes, they will be used to reduce accounts
payable and for other general corporate purposes.
PRICE RANGE OF COMMON STOCK
Imatron's Common Stock is traded in the over-the-counter market on the
NASDAQ National Market System under the symbol "IMAT." The following table sets
forth, for the calendar quarters indicated, the high and low sales prices as
reported by the NASDAQ/NMS.
High Low
---- ---
Year Ended December 31, 1994
First Quarter............. $ 2.06 $ 0.50
Second Quarter............ $ 1.88 $ 0.81
Third Quarter............. $ 1.41 $ 0.88
Fourth Quarter............ $ 1.56 $ 0.88
Year Ended December 31, 1995
First Quarter............. $ 1.31 $ 0.97
Second Quarter............ $ 1.22 $ 0.81
Third Quarter.............. $ 3.53 $ 0.81
Fourth Quarter............ $ 2.97 $ 1.47
Period Ended January 23, 1996
First Quarter . . . . . $ 2.34 $ 1.72
On January 23, 1996, the last reported sales price of Imatron's Common
Stock was $1.91.
PLAN OF DISTRIBUTION
The Company shall offer the Shares on a "best-efforts" basis through
its own efforts using two of its salaried employees without the payment of any
commission, and through the efforts of various placement agents who will receive
commissions in an amount not to exceed 7% of the gross proceeds of the offering.
Each placement agent participating in the distribution is a member of the
National Association of Securities Dealers, Inc. ("NASD"), and is registered as
a broker-dealer in each state in which it will be making offers and sales of the
Shares. None of the placement agents are obligated or intend themselves to take
(or purchase) any of the Common Stock. The Shares will be offered and sold in
privately negotiated transactions.
<PAGE>
Two salaried employees of the Company will be involved in selling the
securities being registered: S. Lewis Meyer and Gary H. Brooks. Mr. Meyer is
President, Chief Executive Officer and a director of the Company, and Mr. Brooks
is Vice President Finance, Chief Financial Officer, and Principal Accounting
Officer. The employees' sales efforts will be restricted to preparing and
delivering written communications including the registration statement,
prospectus, and sales literature and responding to investment inquires from
potential purchasers, such responses to be limited to information contained in
the registration statement. Neither Mr. Meyer nor Mr. Brooks will receive,
directly or indirectly, any commissions or other transaction-based compensation
in connection with the offering.
There is no minimum number of Shares that must be sold in order to
declare this offering effective. Accordingly, all net proceeds from the sale of
Shares will be paid directly to the Company and will not be held in escrow
pending receipt of any minimum amount of proceeds. There is no minimum
subscription amount of Shares that an investor must purchase. No investor funds
will be accepted prior to effectiveness of the Registration Statement. The
offering has no predetermined termination date.
No persons have made any firm commitment as to the number of Shares to
be purchased by them. There can accordingly be no assurance that sufficient
funds will be received to accomplish any of the anticipated uses of the proceeds
of this offering.
EXPERTS
The financial statements of Imatron Inc. appearing in Imatron Inc.'s
Annual Report (Form 10-K) for the year ended December 31, 1994, have been
audited by Ernst & Young, 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 upon the authority of such firm as experts in accounting and auditing.
LEGAL OPINION
The legality of the shares of Common Stock offered will be passed upon
for the Company by Severson & Werson, A Professional Corporation, One
Embarcadero Center, 26th Floor, San Francisco, CA 94111.
<PAGE>
No dealer, salesman or any other person has been authorized to give any
information or to make any representation not contained in this Prospectus in
connection with the offer made hereby. If given or made, such information or
representation must not be relied upon as having been authorized by Imatron Inc.
This Prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any securities other than those specifically offered hereby or an
offer to buy to any person in any jurisdiction in which such an offer or
solicitation would be unlawful. Neither the delivery of this Prospectus nor any
sale made hereunder shall under any circumstances create any implication that
the information contained herein is correct as of any time subsequent to the
date hereof.
2,000,000 Shares
IMATRON INC.
No Par Common Stock
PROSPECTUS
March 21, 1996
