As filed with the Securities and Exchange Commission on
July 20, 1998.
Registration No.:
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT
OF 1933
BALLARD MEDICAL PRODUCTS
(Exact name of registrant as specified in its charter)
UTAH
(State or other jurisdiction of incorporation or
organization)
87-0340144
(IRS Employer Identification Number)
12050 Lone Peak Parkway
Draper, Utah 84020
(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
DALE H. BALLARD, President and Chief Executive Officer
BALLARD MEDICAL PRODUCTS
12050 Lone Peak Parkway
Draper, Utah 84020
(801) 572-6800
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Approximate date of commencement of proposed sale
to the public:
August 3, 1998
If the only securities being registered on this Form are
being offered pursuant to dividend or interest reinvestment
plans, please check the following box. [ ]
If any of the securities being registered on this Form are
to be offered on a delayed or continuous basis pursuant to
Rule 415 under the Securities Act of 1933, other than
securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for
an offering pursuant to Rule 462(b) under the Securities
Act, please check the following box and list the Securities
Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following
box and list the Securities Act registration statement
number of the earlier effective registration statement for
the same offering. [ ]
If delivery of the prospectus is expected to be made
pursuant to Rule 434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Title of
each class Proposed Proposed
of maximum maximum
securities Amount to offering aggregate Amount of
to be be price per offering registration
registered registered unit (1) price fee (2)
Common
Stock, $0.10
par value 1,067,733 $19 $20,286,927 $5,984.64
(1) Estimated solely for the purpose of calculating the
registration fee based upon the average of the high and
low prices of the Registrant's Common Stock quoted by
the New York Stock Exchange at July 9, 1998. Actual
sales prices will be based upon the market.
(2) The registration fee is calculated as follows:
Maximum aggregate offering price
($20,286,927) x .000295 = $5,984.64
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its
effective date until the Registrant shall file a further
amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance
with Section 8(a) of the Securities Act of 1933 or until the
Registration Statement shall become effective on such date
as the Commission, acting pursuant to said Section 8(a), may
determine.
Total Number of Pages - 19
Index to Exhibits Appears on Page - 14
BALLARD MEDICAL PRODUCTS
Cross-Reference Sheet
Between Items of Form S-3 and Prospectus
Pursuant to Item 501(b) of Regulation S-K
Registration Statement
Item and Heading Prospectus Heading
Item 1. Forepart of Registration Cover Page
Statement and Outside Front
Cover Page of Prospectus
Item 2. Inside Front and Outside Inside Cover Page
Back Cover Pages of
Prospectus
Item 3. Summary Information, Risk Prospectus Summary;
Factors, and Ratio of Risk Factors; other
Earnings to Fixed Charges information required
by Item 3 not
applicable
Item 4. Use of Proceeds Use of Proceeds
Item 5. Determination of Offering Not Applicable
Price
Item 6. Dilution Not Applicable
Item 7. Selling Security Holders Selling Stockholders
Item 8. Plan of Distribution Plan of Distribution
Item 9. Description of Securities Description of Capital
to be Registered Stock
Item 10. Interests of Named Experts Not Applicable
and Counsel
Item 11. Material Changes
(a) Material Changes
(b) Information
Incorporated by
Reference
Item 12. Incorporation of Certain Information
Information by Reference Incorporated by
Reference
Item 13. Disclosure of Commission Indemnification of
Position on Indemnification Directors and Officers
for Securities Act
Liabilities
PROSPECTUS
1,067,733 Shares
BALLARD MEDICAL PRODUCTS
Draper, Utah 84020
COMMON STOCK
THE SHARES OF COMMON STOCK OFFERED HEREBY ARE BEING OFFERED
AND SOLD FOR THE ACCOUNT OF CERTAIN STOCKHOLDERS OF THE
COMPANY. SEE "SELLING STOCKHOLDERS." THE SHARES OFFERED
HEREBY ARE LISTED ON THE NEW YORK STOCK EXCHANGE.
THE SHARES OF COMMON STOCK OFFERED HEREBY INVOLVE A HIGH
DEGREE OF RISK. FOR A DISCUSSION OF MATERIAL RISKS IN
CONNECTION WITH THE PURCHASE OF THE COMMON STOCK OFFERED
HEREBY, 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.
Underwriting
Price to Public Discounts and Proceeds
(1) Commissions (2) to Company
Per share $19 $.57 - 0 -
Total $20,286,927 $608,608 - 0 -
(1) Estimated solely for the purpose of calculating the
registration fee based upon the average of the high and
low prices on the New York Stock Exchange for Ballard
Common Stock on July 9, 1998. Actual sales prices will
be based upon the market.
(2) Estimated based upon an approximate 3% average
commission charged for market sales. Commissions will
vary depending upon denominations sold.
The date of this Prospectus is August 3, 1998.
INTRODUCTION
The Company is subject to the informational reporting
requirements of the Securities Exchange Act of 1934, and in
accordance therewith, the Company files reports and other
information with the Securities and Exchange Commission.
Such reports and other information can be inspected and
copied at the public reference facilities of the Commission,
450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's regional offices at City Center, 500 West
Madison, Suite 1400, Chicago, IL 60661-2511; 7 World Trade
Center, Suite 1300, New York, NY 10046; and 5670 Wilshire
Boulevard, Los Angeles, CA 90036, and copies of such
material can be obtained from the Public Reference Section
of the Commission, Washington, D.C. 20549, at prescribed
rates.
The Commission maintains a Web site that contains
reports, proxy and information statements and other
information regarding registrants (such as the Company) that
file electronically with the Commission. The Commission's
Web site address is as follows: http://www.sec.gov. The
Company's Common Stock is listed on the New York Stock
Exchange, 20 Broad Street, New York, NY 10005, and reports
and other information concerning the Company can be
inspected at such exchange.
The Company hereby undertakes to provide without charge
to each person, including any beneficial owner, to whom a
copy of this Prospectus is delivered, upon written or oral
request of any such person, a copy of any and all of the
information that has been incorporated by reference in this
Prospectus (not including exhibits to such information).
Requests for such copies should be directed to E. Martin
Chamberlain, Secretary, Ballard Medical Products, 12050 Lone
Peak Parkway, Draper, Utah 84020, telephone number (801)
572-6800, telefax number (801) 523-5396.
No person has been authorized to give any information
or make any representations, other than those contained in
this Prospectus, and, if given or made, such information or
representations must not be relied upon as having been
authorized by the Company. This Prospectus does not
constitute an offering in any state in which such offering
may not lawfully be made.
TABLE OF CONTENTS
Prospectus Summary . . . . . . . . . . . . . . . . . . . 3
Risk Factors . . . . . . . . . . . . . . . . . . . . . . 4
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . 8
Selling Stockholders . . . . . . . . . . . . . . . . . . 8
Plan of Distribution . . . . . . . . . . . . . . . . . . 8
Description of Capital Stock . . . . . . . . . . . . . . 9
Indemnification of Directors and Officers . . . . . . . 9
Information Incorporated by Reference . . . . . . . . . 10
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by
the detailed information appearing elsewhere in this
Prospectus and by the information and financial statements
incorporated herein by reference.
This Prospectus relates to 1,067,733 shares of Common
Stock, $0.10 par value of Ballard Medical Products (the
"Company") issued to the former shareholders of Tri-Med
Specialties, Inc., a Kansas corporation ("Tri-Med"). The
Company has effected a stock-for-stock exchange, by which
shares of the Company were issued to all of the shareholders
of Tri-Med, in exchange for all of the outstanding shares of
stock of Tri-Med.
This is a secondary offering, made "at the market".
Accordingly, the offering does not involve an underwriting
in the conventional sense.
This prospectus sets forth information regarding risk
factors and other aspects of the Company's operations and
this offering.
The Company's executive offices are located at 12050
Lone Peak Parkway, Draper, Utah 84020, and its telephone
number and telefax number, respectively at that location are
(801) 572-6800 and (801) 523-5396.
RISK FACTORS
From time to time the Company may report, through its
press releases, its Annual Report, and SEC filings, certain
matters that could be characterized as forward-looking
statements subject to risks and uncertainties that could
cause actual results to differ materially from those
projected. Such risks and uncertainties may include, among
other things, the factors discussed below. Such forward-
looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act
of 1995.
COMPETITION. The medical device industry is
characterized by rapidly evolving technology and increased
competition. There are a number of companies that currently
offer, or are in the process of developing, products that
compete with products offered by the Company, including the
Company's flagship TRACH CARE closed suction catheter. Some
of these competitors have substantially greater capital
resources, research and development staffs and experience in
the medical device industry. These competitors may succeed
in developing technologies and products that are more
effective than those currently used or produced by the
Company or that would render some products offered by the
Company obsolete or noncompetitive. Competition based on
price is becoming an increasingly important factor in
customer purchasing patterns as a result of cost containment
pressures on, and consolidation in, the health care
industry. Such competition has exerted, and is likely to
continue to exert, downward pressure on the prices the
Company is able to charge for its products. The Company may
not be able to offset such downward price pressure through
corresponding cost reductions. Price reductions could have
an adverse impact on the business, results of operations,
financial condition, or cash flows of the Company.
INTELLECTUAL PROPERTY RIGHTS. From time to time, the
Company has received, and in the future may receive, notices
of claims with respect to possible infringement of the
intellectual property rights of others or notices of
challenges to the Company's intellectual property rights.
In some instances such notices have given rise to, or may in
the future give rise to, litigation. Any litigation
involving the intellectual property rights of the Company
may be resolved by means of a negotiated settlement or by
contesting the claim through the judicial process. There
can be no assurance that the business, results of operations
or the financial condition of the Company will not suffer an
adverse impact as a result of intellectual property claims
that may be commenced against the Company in the future.
The Company owns certain patents and proprietary information
acquired while developing its products or through
acquisitions, and the Company is the licensee of certain
other technology. As patents expire, more competing
products may be released into the marketplace by other
companies. The ability of the Company to continue to
compete effectively with other medical device companies may
be materially dependent upon the protection afforded by its
patents and the confidentiality of certain proprietary
information. There can be no assurance that patents will be
issued for products and product improvements recently
released into the marketplace or for products presently
being developed.
MANAGED CARE AND OTHER HEALTH CARE PROVIDER
ORGANIZATIONS. Managed care and other health care provider
organizations have grown substantially in terms of the
percentage of the population in the United States that
receives medical benefits through such organizations and in
terms of the influence and control that they are able to
exert over an increasingly large portion of the health care
industry. These organizations are continuing to consolidate
and grow, increasing the ability of these organizations to
influence the practices and pricing involved in the purchase
of medical devices, including the products sold by the
Company.
HEALTH CARE REFORM/PRICING PRESSURE. The health care
industry in the United States continues to experience
change. Health care reform proposals have been formulated
by members of Congress. In addition, state legislatures
periodically consider various health care reform proposals.
Federal, state and local government representatives will, in
all likelihood, continue to review and assess alternative
health care delivery systems and payment methodologies, and
ongoing public debate of these issues can be expected. Cost
containment initiatives, market pressures and proposed
changes in applicable laws and regulations may have a
dramatic effect on pricing or potential demand for medical
devices, the relative costs associated with doing business
and the amount of reimbursement by both government and
third-party payors. In particular, the industry is
experiencing market-driven reforms from forces within the
industry that are exerting pressure on health care companies
to reduce health care costs. These market-driven reforms
are resulting in industry-wide consolidation that is
expected to increase the downward pressure on product
margins, as larger buyer and supplier groups exert pricing
pressure on providers of medical devices and other health
care products. Both short-term and long-term cost
containment pressures, as well as the possibility of
regulatory reform, may have an adverse impact on the
Company's results of operations and financial condition.
The Company's products consist primarily of disposable
medical devices. Cost containment pressures on hospitals
are leading some facilities to use certain disposable
devices longer than they have been used in the past, even
longer than permitted by product labelling. This phenomenon
could result in a reduction in Company sales, because
extended use and device reuse mean fewer unit purchases.
GOVERNMENT REGULATION. There has been a trend in
recent years, both in the United States and outside the
United States, toward more stringent regulation of, and
enforcement of requirements applicable to, medical device
manufacturers. The continuing trend of more stringent
regulatory oversight in product clearance and enforcement
activities has caused medical device manufacturers to
experience longer approval cycles, more uncertainty, greater
risk and greater expense. At the present time, there are no
meaningful indications that this trend will be discontinued
in the near-term or the long-term either in the United
States or abroad. The Company expects to continue to incur
additional operating expenses associated with its ongoing
regulatory compliance program, but the amount of these
incremental costs cannot be completely predicted and will
depend upon a variety of factors, including future changes
in statutes and regulations governing medical device
manufacturers. There can be no assurance that such
compliance requirements and quality assurance programs will
not have an adverse impact on the business, results of
operations or financial condition of the Company or that the
Company will not experience problems associated with FDA
regulatory compliance.
NEW PRODUCT INTRODUCTIONS. As the existing products of
the Company become more mature and its existing markets more
saturated, the importance of developing or acquiring new
products will increase. The development of any such
products will entail considerable time and expense,
including research and development costs and the time and
expense required to obtain necessary regulatory approvals,
which could adversely affect the business, results of
operations or financial condition of the Company. There can
be no assurance that such development activities will yield
products that can be commercialized profitably, or that any
product acquisition can be consummated on commercially
reasonable terms or at all. Any failure to acquire or
develop new products to supplement more mature products
could have an adverse impact on the business, results of
operations or financial condition of the Company.
TECHNOLOGICAL CHANGE. The medical technology as
utilized by the Company has been subject to rapid advances.
While the Company feels that it currently possesses the
technology necessary to carry on its business, its
commercial success will depend on its ability to remain
current with respect to such technological advances and to
retain experienced technical personnel. Furthermore, there
can be no assurance that other technological advances will
not render the Company's technology and certain products
uneconomical or obsolete.
PRODUCT LIABILITY EXPOSURE. Because its products are
intended to be used in health care settings on patients who
are physiologically unstable and may also be seriously or
critically ill, the Company is exposed to potential product
liability claims. From time to time, patients using the
Company's products have suffered serious injury or death,
which has led to product liability claims against the
Company. Some product liability claims have been inherited
by the Company through business acquisitions.
The Company maintains product liability coverage in
amounts that it deems sufficient for its business. However,
there can be no assurance that such coverage will ultimately
prove to be adequate, or that such coverage will continue to
remain available on acceptable terms or any terms at all.
ACQUISITIONS. In order to continue increasing sales
volume and profits, the Company relies heavily on a program
of acquiring business and new product lines from other
companies. There is always a significant risk that a given
acquisition by the Company will prove to be unsuccessful or
end up not contributing sufficiently to sales and profit
growth of the Company. There is also a risk that
undiscovered or contingent liabilities of an acquired
company could negatively impact the Company's financial
position or even the acquisition transaction itself. The
integration of any businesses that the Company might acquire
could require substantial management resources. The moving
of acquired product lines can also result in interruptions
in production and backorders. There can be no assurance
that any such integration will be accomplished without
having a short or potentially long-term adverse impact on
the business, results of operations or financial condition
of the Company or that the benefits expected from any such
integration will be fully realized.
LACK OF DIVIDENDS. Prior to January, 1990, no
dividends had been paid by the Company on its shares of
Common Stock. The Company has paid dividends since January,
1990. However, there can be no assurance that dividends
will be paid on shares in the future, particularly since the
Company prefers to reserve its cash and liquid assets for
growth and possible business acquisitions.
UNCERTAINTY OF FINANCIAL RESULTS AND CAPITAL NEEDS.
There may be substantial fluctuations in the Company's
results of operations because of the timing and recording of
revenues and market acceptance of existing Company products.
The ability of the Company to expand its manufacturing and
marketing operations cannot be predicted with certainty. If
revenues do not continue to increase as rapidly as they have
in the past few years, or if manufacturing, marketing, or
research and development are not successful or require more
money than is anticipated, the Company may have to scale
back product marketing, development and production efforts
and attempt to obtain external financing. There can be no
assurance that the Company would be able to obtain timely
external financing in the amounts required or that such
financing, if available, would be on terms advantageous to
the Company.
SUPPLY OF RAW MATERIALS. Certain of the Company's
products are dependent upon raw materials for which there
are few sources. So far, the Company has not had any
serious problems obtaining needed raw materials.
IMPACT OF CURRENCY FLUCTUATIONS; IMPORTANCE OF FOREIGN
SALES. Because certain sales of products by the Company
outside the United States typically are denominated in local
currencies, the results of operations of the Company are
expected to continue to be affected by changes in exchange
rates between certain foreign currencies and the United
States Dollar. There can be no assurance that the Company
will not experience currency fluctuation effects in future
periods, which could have an adverse impact on its business,
results of operation or financial condition. The operations
and financial results of the Company also may be
significantly affected by other international factors,
including changes in governmental regulations or import and
export restrictions, and foreign economic and political
conditions generally.
The Company's ability to continue to sell products into
Europe is dependent to a large extent on its ability to
maintain the important ISO 9001/EN 4601 certification and
the CE marking of conformity. If the Company were to lose
such certifications, such loss would have a material,
adverse impact on international sales and profits.
POSSIBLE VOLATILITY OF STOCK PRICE. The market price
of the Company's stock is, and is expected to continue to
be, subject to significant fluctuations in response to
variations in quarterly operating results, trends in the
health care industry in general and the medical device
industry in particular, and certain other factors beyond the
control of the Company. In addition, broad market
fluctuations, as well as general economic or political
conditions and initiatives, may adversely impact the market
price of the Company's stock, regardless of the Company's
operating performance.
YEAR 2000 ISSUES. The Year 2000 Issue is the result of
potential problems with computer systems or any equipment
with computer chips that use dates where the date has been
stored as just two digits (e.g., 97 for 1997). On January
1, 2000, any clock or date recording mechanism, including
date sensitive software, which uses only two digits to
represent the year, may recognize a date using 00 as the
year 1900 rather than the year 2000. The Company has also
been advised that some computer chips may not have the
ability to function properly when reading certain dates in
calendar year 1999 (e.g., 9/9/99). These computer problems
could result in a system failure or miscalculations causing
disruption of operations, including among other things, a
temporary inability to process transactions, send invoices,
or engage in similar activities.
The Company has already determined that it would be
required to replace or modify portions of its business
application software so that its computer systems would
properly utilize dates beyond December 31, 1999. However,
if such modifications and conversions are not made, or are
not timely, the Year 2000 Issue could have a material impact
on the operations of the Company.
The Company can give no guarantee that the systems of
other companies on which the Company's systems rely will be
converted on time or that a failure to convert by another
company or a conversion that is incompatible with the
Company's systems, would not have a material adverse effect
on the Company.
The Company will continue to utilize internal and
external resources to implement, reprogram, or replace and
test software and related assets affected by the Year 2000
Issue. The Company expects to complete the majority of its
efforts in this area by early 1999 leaving adequate time to
assess and correct any significant issues that may
materialize. The total cost of the Year 2000 project is
estimated at $500,000 to $600,000 and is being funded
through operating cash flows. The Company will be able to
capitalize a substantial portion of this cost.
The costs of the project and the timetable in which the
Company plans to complete the Year 2000 compliance
requirements are based on management's best estimates, which
were derived utilizing numerous assumptions of future events
including the continued availability of certain resources,
third party modification plans and other factors. However,
there can be no guarantee that these estimates will be
achieved and actual results could differ materially from
these plans. Specific factors which might cause such
material differences include, but are not limited to, the
availability and cost of personnel trained in this area, the
ability to locate and correct all relevant computer chip
codes, and similar uncertainties.
USE OF PROCEEDS
Since this is a secondary offering in behalf of four
stockholders, no proceeds of the offering will be received
directly by the Company.
SELLING STOCKHOLDERS
The table set forth below describes the selling
stockholders and their ownership of the shares being
registered hereby:
Number of
Company Shares
Owned as of the
Name of Seller Date Hereof
C. Phillip Pattison 320,319
Kevin R. Dye 320,319
Barry J. Marshall 106,776
William A. Fry 320,319
Total shares 1,067,733
None of the above-named shareholders is an officer, director
or affiliate of the Company. Other than the shares being
registered hereby, such shareholders own no shares of
Ballard Medical Products stock.
PLAN OF DISTRIBUTION
Shares sold hereunder will be sold by the selling
stockholders for their own accounts. The Company will
receive none of the proceeds from any sale of the shares.
The selling stockholders may sell shares from time to
time in one or more transactions (which may include block
trades) on the New York Stock Exchange, in negotiated
transactions or through a combination of such methods for
sale, at fixed prices, which may be changed, at market
prices prevailing at the time of sale, at prices related to
such prevailing prices or at negotiated prices. The selling
stockholders may effect such transactions by selling the
shares to or through broker-dealers, who may receive
compensation in the form of discounts, concessions or
commissions from the selling stockholders or the purchaser
for whom such broker-dealers may act as agent or to whom
they may sell as principal, or both (which compensation as
to a particular broker-dealer may be in excess of customary
compensation).
The selling shareholders and any broker-dealers buying
the shares from, or effecting transactions in the shares on
behalf of, the selling stockholders may be deemed to be
"underwriters" within the meaning of the Securities Act, and
any compensation and discounts received by such broker-
dealers and any profits on the resale of the shares by such
broker-dealers may be deemed to be underwriters' discounts
and commissions under the Securities Act.
This offering is made on a continuous, delayed basis
pursuant to Reg. Sec. 230.415, promulgated by the Securities
and Exchange Commission under the Securities Act.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of
75,000,000 Common Shares authorized, $0.10 par value, of
which 30,444,466 shares were outstanding as of July 10,
1998. The holders of Common Stock are entitled to one vote
for each share held of record on all matters submitted to a
vote of shareholders, including the election of directors.
Holders of Common Stock are entitled to receive ratably such
dividends as may be declared by the Board of Directors out
of funds legally available therefor. In the event of a
liquidation, dissolution or winding up of the Company,
holders of Common Stock are entitled to share ratably in all
assets remaining after payment of liabilities. Holders of
Common Stock have no preemptive rights to purchase
additional shares and have no rights to convert their Common
Stock into any other securities. All of the outstanding
shares of Common Stock are fully paid and non-assessable.
Shareholders do not have cumulative voting rights.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The revised Utah Business Corporation Act permits
indemnification of the officers and directors of a
corporation. The Company may indemnify any officer or
director against liability incurred in any threatened,
pending, or completed action, suit or proceeding (whether
civil, criminal, administrative or investigative, and
whether formal or informal), if: (a) his or her conduct was
in good faith; and (b) he or she reasonably believed that
his or her conduct was in, or not opposed to, the
corporation's best interest; and (c) in the case of any
criminal proceeding, he or she had no reasonable cause to
believe his or her conduct was unlawful. The determination
as to whether in a specific case indemnification of a
director or officer is permissible (i.e., whether the
director or officer has met the above applicable standard of
conduct), is generally to be made by the Board of Directors
by a majority vote. The Company may not indemnify a
director or officer: (1) in connection with a proceeding by
or in the right of the Company in which the director or
officer was adjudged liable to the Company; or (2) in
connection with any other proceeding charging that the
director or officer derived an improper personal benefit,
whether or not involving action in his or her official
capacity, in which proceeding he or she was adjudged liable
on the basis that he or she derived an improper personal
benefit. Indemnification permitted in connection with a
proceeding by or in the right of the Company is limited to
reasonable expenses incurred in connection with the
proceeding.
The Company is required to indemnify a director or
officer who is successful, on the merits or otherwise, in
the defense of any proceeding, or in the defense of any
claim, issue or matter in the proceeding, to which he or she
was a party because he or she is or was a director of the
Company, against reasonable expenses incurred in connection
with the proceeding or claim with respect to which he or she
has been successful. The Company may purchase and maintain
liability insurance on behalf of directors, officers,
employees, fiduciaries, and agents of the Company, whether
or not the Company would have power to indemnify them
against liability.
The general effect of the Bylaws of the Company under
which any director or officer of the Company is insured or
indemnified in any manner against liability which he or she
may incur in his or her capacity as a director or officer is
set forth in Article VIII of the Company's Bylaws, which
contains provisions almost identical to the provisions of
Utah Code Annotated, Section 16-10a-901 et seq., summarized
above. In addition, in November, 1993, the Board of
Directors authorized and directed the Company to enter into
(and the Company has executed) an Indemnification Agreement
with each director and executive officer of the Company, by
which the Company is contractually obligated to indemnify
directors and officers in accordance with the standards,
terms, and conditions of Article VIII of the Company's
Bylaws.
Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors,
officers or persons controlling the Company pursuant to the
revised Utah Business Corporation Act and the Amended and
Restated Bylaws of the Company, the Company has been
informed that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore
unenforceable.
INFORMATION INCORPORATED BY REFERENCE
1. The Company's Report on Form 10-K for the fiscal
year ended September 30, 1997, filed with the Commission on
December 15, 1997, as amended and restated by the Company's
Current Report on Form 8-K, filed with the Commission on
July 14, 1998 (as further amended and restated by the
Company's Current Report on Form 8-K/A, filed with the
Commission on July 20, 1998).
2. The Description of Common Stock contained in the
Company's Registration of Securities on Form 8-A pursuant to
Section 12(b) of the Securities Exchange Act of 1934, filed
with the Commission on September 3, 1993.
3. The Company's Proxy Statement and Annual Report
for the Annual Meeting held January 26, 1998, filed with the
Commission on December 12, 1997.
4. The Company's Quarterly Report on Form 10-Q/A, for
the quarter ended December 31, 1997, filed with the
Commission on July 10, 1998.
5. The Company's Current Report on Form 8-K, filed
with the Commission on March 10, 1998.
6. The Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1998, filed with the Commission
on May 15, 1998.
In addition, all documents filed subsequent to the date
hereof by the Company 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 Prospectus
and to be part hereof from the date of filing such
documents.
PART II
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Set forth below is an itemized statement of all estimated
expenses to be incurred by the Company in connection with the
issuance and distribution of the securities to be registered
hereby, other than commissions:
Registration fees -SEC $5,984
Transfer agents fees (1) 12,810
Costs of printing and copying 100
Accounting fees 8,000
Long distance telephone charges 150
Total $27,044
(1) Estimated, based upon assumed 2,135 number of
certificates to be reissued.
No part of these expenses will be borne by the selling
stockholders.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The general effect of Utah's indemnification statute
and the Company's indemnification bylaw are set forth in
Part I, "Indemnification of Directors and Officers".
ITEM 16. EXHIBITS.
See "Index to Exhibits".
ITEM 17. 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 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;
(4) That for purposes of determining any liability
under the Securities Act of 1933, each filing of the
registrants's annual report pursuant to Section 13(a) or
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 therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof:
(5) To deliver or cause to be delivered with the
prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to securities holders that
is incorporated by reference in the prospectus and furnished
pursuant to and meeting the requirements of Rule 14a-3 or
Rule 14c-3 under the Securities Exchange Act of 1934; and,
where interim financial information required to be presented
by Article 3 of Regulation S-X are not set forth in the
prospectus, to deliver, or cause to be delivered to each
person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by
reference in the prospectus to provide such interim
financial information; and
(6) That 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 an 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.
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the Registrant, Ballard Medical Products, a
corporation organized and existing under the laws of the
State of Utah, certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on
Form S-3 and has duly caused this Registration Statement to
be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Draper, State of Utah, on this
20th day of July, 1998.
BALLARD MEDICAL PRODUCTS
By: Dale H.Ballard, President
Pursuant to the requirements of the Securities Act of
1933, this Registration Statement has been signed by the
following persons in the capacities indicated and on the
date indicated.
Date: Signature: Title:
7/20/98 Dale H. Ballard President,
Chief Executive Officer
Chairman of the Board
7/20/98 Kenneth R. Sorenson Principal Financial Officer
7/20/98 Leland H. Boardman Controller
7/20/98 Dale H. Ballard, Jr. Director
7/20/98 E. Martin Chamberlain, Jr. Director
7/20/98 Paul W. Hess Director
EXHIBITS
Exhibit
Number Description of Exhibit Page No.
1 Not applicable
2 Not applicable
4.1 Restated Certificate Incorporated by
of Incorporation, dated reference from
September 18, 1987 July 10, 1991
Form S-8
Registration Statement
Exhibit 4.1
Registration
No. 33-41720
4.2 Articles of Amendment, Incorporated by
to Articles of reference from
Incorporation dated Exhibit 4.2 to the
July 10, 1991 Registration
Statement on
Form S-3, filed
November 13, 1991,
Registration
No. 33-43910
4.3 Articles of Amendment, Incorporated by
to Articles of reference from
Incorporation dated Exhibit 4.3 to the
September 21, 1993 Registration
Statement on
Form S-8, filed
December 20, 1993
Registration
No. 33-73194
4.4 Amended and Incorporated by
Restated Bylaws of reference from
Ballard Medical Exhibit 3.3 to
Products, dated Form 10-K filed
October 12, 1992 December 24, 1992
5 Opinion of Counsel p. 15
8 Not applicable
12 Not applicable
15 Not applicable
23.1 Consent of Deloitte & p. 16
Touche LLP (Salt Lake
City, Utah)
23.2 Consent of p. 17
PricewaterhouseCoopers
LLP (Kansas City,
Missouri)
23.3 Consent of counsel p. 15
(contained in
Exhibit 5)
24 Not applicable
25 Not applicable
26 Not applicable
27 Amended and Restated p. 16
Financial Data Schedules
28 Not applicable
EXHIBIT 5
M E M O R A N D U M
To: Board of Directors of Ballard Medical Products
From: Paul W. Hess, General Counsel
Date: July 17, 1998
Re: Registration Statement on Form S-3
I have examined the Registration Statement on Form S-3 to be
filed by Ballard Medical Products (the "Company") with the
Securities and Exchange Commission on or about July 20, 1998 (the
"Registration Statement"), in connection with the shelf
registration under the Securities Act of 1933, as amended, of
1,067,733 shares of the Company's common stock, $.10 par value
(the "Shares"), for and in behalf of the following shareholders:
C. Phillip Pattison
Kevin R. Dye
Barry J. Marshall
William A. Fry
It is my opinion that the Shares being registered are legally and
validly issued, fully paid and nonassessable.
I consent to the use of this opinion as an exhibit to the
Registration Statement, and further consent to the use of my name
wherever appearing in the Registration Statement and any
amendments thereto.
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of Ballard Medical Products on Form S-3 of our report
dated November 13, 1997 (February 25, 1998 as to Note 12) which
expresses an unqualified opinion and includes an explanatory
paragraph relating to the Company's change in its method of
accounting for investment securities to conform with Statement of
Financial Accounting Standards No. 115, appearing in the Current
Report on Form 8-K/A dated July 17, 1998 of Ballard Medical
Products.
Deloitte & Touche LLP
Salt Lake City, Utah
July 17, 1998
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this registration
statement on Form S-3 of Ballard Medical Products of our report
dated January 30, 1998, on our audits of the financial statements
of Tri-Med Specialties, Inc. as of September 30, 1997 and 1996
and the year ended September 30, 1997 which report is included in
Ballard Medical Products' Current Report on Form 8-K filed with
the Commission on July 13, 1998.
Kansas City, Missouri PricewaterhouseCoopers LLP
July 15, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This exhibit contains amended and restated financial data schedules for
selected prior periods.
</LEGEND>
<RESTATED>
<S> <C> <C> <C> <C>
<C>
<PERIOD-TYPE> YEAR 3-MOS 3-MOS 3-MOS
YEAR
<FISCAL-YEAR-END> SEP-30-1995 SEP-30-1996 SEP-30-1996 SEP-30-1996
SEP-30-1996
<PERIOD-START> OCT-01-1994 OCT-01-1995 JAN-01-1996 APR-01-1996
OCT-01-1995
<PERIOD-END> SEP-30-1995 DEC-31-1995 MAR-31-1996 JUN-30-1996
SEP-30-1996
<CASH> 27,848,683 28,933,468 25,450,040 20,782,849
14,518,835
<SECURITIES> 18,357,304 18,823,639 20,753,322 25,476,775
26,662,598
<RECEIVABLES> 15,052,916 16,194,618 16,116,503 19,754,609
21,628,159
<ALLOWANCES> 625,000 625,000 625,000 625,000
997,000
<INVENTORY> 11,765,067 12,066,313 12,745,883 13,939,605
14,306,725
<CURRENT-ASSETS> 77,074,984 78,820,861 78,886,780 84,116,372
82,626,457
<PP&E> 28,230,099 29,506,674 33,642,460 38,674,871
43,642,149
<DEPRECIATION> 6,144,193 6,518,911 6,869,921 7,423,446
8,182,072
<TOTAL-ASSETS> 115,216,589 120,365,364 124,640,752 136,308,961
144,164,584
<CURRENT-LIABILITIES> 4,527,471 7,462,947 4,753,130 6,480,822
6,032,987
<BONDS> 0 0 0 0
0
0 0 0 0
0
0 0 0 0
0
<COMMON> 2,776,775 2,773,988 2,794,009 2,827,805
2,877,005
<OTHER-SE> 107,678,586 109,795,395 116,618,385 126,997,334
134,143,828
<TOTAL-LIABILITY-AND-EQUITY> 115,216,589 120,365,364 124,640,752 136,308,961
144,164,584
<SALES> 90,041,201 25,170,870 27,377,385 28,476,196
109,881,342
<TOTAL-REVENUES> 90,041,201 25,170,870 27,377,385 28,476,196
109,881,342
<CGS> 30,166,070 8,671,873 9,390,865 9,820,763
38,048,879
<TOTAL-COSTS> 60,953,463 17,332,301 18,683,127 18,869,332
74,514,080
<OTHER-EXPENSES> 0 0 0 0
0
<LOSS-PROVISION> 0 0 0 0
0
<INTEREST-EXPENSE> 0 0 0 0
0
<INCOME-PRETAX> 33,188,775 8,882,411 10,279,578 10,897,048
40,676,642
<INCOME-TAX> 11,248,899 3,230,510 3,600,000 3,969,834
14,767,121
<INCOME-CONTINUING> 21,939,876 5,651,901 6,679,578 6,927,214
25,909,521
<DISCONTINUED> 0 0 0 0
0
<EXTRAORDINARY> 0 0 0 0
0
<CHANGES> 0 0 0 0
0
<NET-INCOME> 21,939,876 5,651,901 6,679,578 6,927,214
25,909,521
<EPS-PRIMARY> 0.796 0.200 0.237 0.246
0.922
<EPS-DILUTED> 0.754 0.192 0.227 0.234
0.874
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This exhibit contains amended and restated financial data schedules for selected
prior periods.
</LEGEND>
<RESTATED>
<S> <C> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS 3-MOS
<FISCAL-YEAR-END> SEP-30-1997 SEP-30-1997 SEP-30-1997
<PERIOD-START> OCT-01-1996 JAN-01-1997 APR-01-1997
<PERIOD-END> DEC-31-1996 MAR-31-1997 JUN-30-1997
<CASH> 1,622,029 13,951,233 12,868,150
<SECURITIES> 23,779,425 18,820,720 25,358,142
<RECEIVABLES> 22,659,651 25,422,865 24,032,442
<ALLOWANCES> 1,446,417 1,446,417 1,446,417
<INVENTORY> 15,639,434 18,272,547 19,335,529
<CURRENT-ASSETS> 65,927,370 78,148,252 84,902,447
<PP&E> 47,424,163 50,870,163 53,693,399
<DEPRECIATION> 9,301,082 9,427,759 10,051,543
<TOTAL-ASSETS> 153,191,898 167,568,235 175,339,943
<CURRENT-LIABILITIES> 7,677,929 7,855,417 6,445,339
<BONDS> 0 0 0
0 0 0
0 0 0
<COMMON> 2,882,591 2,936,649 2,962,353
<OTHER-SE> 141,923,543 156,336,084 165,492,166
<TOTAL-LIABILITY-AND-EQUITY> 153,191,898 167,568,235 175,339,943
<SALES> 30,152,841 32,517,823 33,961,010
<TOTAL-REVENUES> 30,152,841 32,517,823 33,961,010
<CGS> 10,856,086 11,400,392 12,276,819
<TOTAL-COSTS> 20,127,718 21,637,099 24,076,087
<OTHER-EXPENSES> 0 0 0
<LOSS-PROVISION> 0 0 0
<INTEREST-EXPENSE> 0 0 0
<INCOME-PRETAX> 11,222,978 11,971,526 12,113,121
<INCOME-TAX> 4,138,000 4,145,000 4,336,000
<INCOME-CONTINUING> 7,084,978 7,826,526 7,777,121
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 7,084,978 7,826,526 7,777,121
<EPS-PRIMARY> 0.245 0.265 0.268
<EPS-DILUTED> 0.236 0.259 0.256
</TABLE>
