<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 12, 1996
Registration No. 333-4006
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
POSITRON CORPORATION
(Exact name of Registrant as specified in its charter)
TEXAS 76-0083622
(State or other jurisdiction (I.R.S. Employer Identification Number)
of incorporation or organization)
16350 PARK TEN PLACE
HOUSTON, TEXAS 77084
(713) 492-7100
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
----------------------
DR. WERNER J. HAAS
PRESIDENT AND CHIEF EXECUTIVE OFFICER
POSITRON CORPORATION
16350 PARK TEN PLACE
HOUSTON, TEXAS 77084
(713) 492-7100
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------------
Copy to:
Copies of communications, including all communications to the agent for
service, should be sent to:
A. WINSTON OXLEY, ESQ.
VINSON & ELKINS L.L.P.
3700 TRAMMELL CROW CENTER
2001 ROSS AVENUE
DALLAS, TEXAS 75201-2975
(214) 220-7700
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement as determined
in light of market conditions and other factors.
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]
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
====================================================================================================================================
Title of each Class of Amount to be Proposed Maximum Proposed Maximum Amount of
Securities to be registered Registered Offering Price per Unit Aggregate Offering Price(3) Registration Fee
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Common Stock, $.01 par
value per share(1) . . . . 3,391,992 $3.4375 (3) $11,659,972 $4,021
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share(2) . . . . 1,346,030 $3.4375 (3) $4,626,978 $1,596
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share (4) (6) . 349,999 $3.8125 (7) $1,334,371 $460
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share (5) (6) . 175,007 $3.8125 (7) $667,214 $230
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share(1) (5) . . 33,333 $3.75 (8) $124,999 $43
- ------------------------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 par
value per share(2) (5) . . 16,664 $3.75 (8) $62,490 $22
- ------------------------------------------------------------------------------------------------------------------------------------
Total Registration Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,372 (9)
====================================================================================================================================
</TABLE>
<PAGE> 2
(1) Issuable upon the conversion of 2,691,992 shares of Series A 8% Cumulative
Convertible Redeemable Preferred Stock (the "Series A Preferred Stock")
currently issued and outstanding and 700,000 shares of Series A Preferred
Stock which may be issued from time to time after July 1, 1996, if at all,
at the option of the Company to the holders of outstanding Series A
Preferred Stock in payment of dividends accrued thereunder. These shares
were registered previously by the initial filing of this Registration
Statement on April 25, 1996.
(2) Issuable upon exercise of the Redeemable Common Stock Purchase Warrants
(The "Common Stock Warrants"). These shares were registered previously by
the initial filing of this Registration Statement on April 25, 1996.
(3) Estimate solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) using the average of the high and low prices
reported on The Nasdaq Stock Market for the Registrant's Common Stock on
April 24, 1996.
(4) Additional shares of Common Stock issuable upon the conversion of 349,999
shares of Series A Preferred Stock issued as a result of the exercise of
the overallotment option the Company granted to Spencer Trask Securities
Incorporated (the "Placement Agent"), the placement agent for the 1996
Private Offering (as hereinafter defined).
(5) Additional shares of Common Stock issuable upon the exercise of the Common
Stock Warrants issued as a result of the exercise of the overallotment
option the Company granted to the Placement Agent in the 1996 Private
Offering.
(6) In addition, included is an indeterminate number of additional shares of
Common Stock which also may become issuable upon conversion of the Series A
Preferred Stock or the exercise of the Redeemable Common Stock Purchase
Warrants pursuant to the anti-dilution provisions thereof.
(7) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) using the average of the high and low prices
reported on the Nasdaq Stock Market for the Registrant's Common Stock on
May 21, 1996.
(8) Estimated solely for the purposes of calculating wht registration fee in
accordance with Rule 457(c) using the average of the high and low prices
reported on the Nasdaq Stock Market for the Registrant's Common Stock on
June 7, 1996.
(9) $63 is being paid with this filing. The Company paid an aggregate of
$6307 in connection with the initial filing of this Registration Statement
on April 25, 1996 and the filing of Amendment No. 1 to this Registration
Statement on May 22, 1996.
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.
- --------------------------------------------------------------------------------
<PAGE> 3
PROSPECTUS
POSITRON CORPORATION
5,313,025 Shares of Common Stock, $.01 par value
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------
This Prospectus relates to the offering by the Selling Shareholders
(the "Selling Shareholders") of up to an aggregate of 5,313,025 shares (the
"Offered Securities") of Common Stock, par value $.01 per share ("Common
Stock"), of Positron Corporation, a Texas corporation ("Positron" or the
"Company"), issuable upon conversion of the Company's currently outstanding
shares of Series A 8% Cumulative Convertible Redeemable Preferred Stock, par
value $1.00 per share (the "Series A Preferred Stock"), upon conversion of the
authorized Series A Preferred Stock which may be issued from time to time after
July 1, 1996, if at all, at the option of the Company to the Selling
Shareholders in payment of dividends accrued on the outstanding Series A
Preferred Stock and upon exercise of the Company's outstanding Redeemable
Common Stock Purchase Warrants (the "Common Stock Warrants"). In February and
March of 1996, the Company issued in a private offering to qualified investors
(the "1996 Private Offering") 3,775,324 shares of Series A Preferred Stock and
Common Stock Warrants to purchase 1,537,701 shares of Common Stock. In
addition, in February of 1996, the Company exchanged all of the Underwriter's
Warrants previously issued to Josephthal Lyon & Ross Incorporated ("Josephthal")
pursuant to that certain Underwriter's Warrant Agreement dated as of December 3,
1993, between the Company and Josephthal, for 392,000 shares of Series A
Preferred Stock and Common Stock Warrants to purchase 196,000 shares of Common
Stock in a transaction unrelated to the 1996 Private Offering (the "Josephthal
Securities"). The Company has authorized and reserved for issuance 700,000
shares of Series A Preferred Stock which may be issued from time to time after
July 1, 1996, if at all, to the Selling Stockholders in payment of dividends
accrued on the outstanding Series A Preferred Stock. See "Selling
Shareholders."
The Offered Securities may be sold from time to time pursuant to this
Prospectus by the Selling Shareholders. The Offered Securities may be sold by
the Selling Shareholders in ordinary brokerage transactions, in transactions in
which brokers solicit purchases, in negotiated transactions or in a combination
of such methods of sale, at market prices prevailing at the time of sale, at
prices relating to such prevailing market prices or at negotiated prices. See
"Plan of Distribution." The distribution of the Offered Securities is not
subject to any underwriting agreement. The Company will receive no part of the
proceeds of sales from the offering by the Selling Shareholders. All expenses
of registration incurred in connection with this offering are being borne by
the Company, but all selling and other expenses incurred by the Selling
Shareholders will be borne by such Selling Shareholders. None of the
securities offered pursuant to this Prospectus have been registered prior to
the filing of the Registration Statement of which this Prospectus is a part.
The Company's Common Stock is currently listed on the Nasdaq National
Market of The Nasdaq Stock Market under the symbol "POSI." The last reported
sale price of the Common Stock on June 11, 1996 was $3 15/16.
Each Selling Shareholder and any broker executing selling orders on
behalf of a Selling Shareholder may be deemed to be an "underwriter" within the
meaning of the Securities Act of 1933 (the "Securities Act"). Any commissions
received by any broker may be deemed to be underwriting commissions under the
Securities Act.
--------------------
THE DATE OF THIS PROSPECTUS IS JUNE 12, 1996.
<PAGE> 4
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON
REQUEST FROM POSITRON CORPORATION, 16350 PARK TEN PLACE, HOUSTON, TEXAS 77084,
ATTENTION: DAVID O. RODRIGUE, VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND
SECRETARY (TELEPHONE: (713) 492-7100). IN ORDER TO INSURE TIMELY DELIVERY OF
THE DOCUMENTS, POTENTIAL INVESTORS SHOULD ALLOW FIVE BUSINESS DAYS FOR
DELIVERY. SEE "INCORPORATION OF CERTAIN INFORMATION BY REFERENCE."
AVAILABLE INFORMATION
No person has been authorized to give any information or to make any
representations in connection with this offering other than those contained in
this Prospectus. If given or made, such representations must not be relied
upon as having been authorized by the Company or any Selling Shareholder. This
Prospectus shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of these securities in any State in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities law of any such State.
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, proxy and information statements 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 facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's Regional Offices at Seven World Trade Center, 13th Floor, New
York, New York 10048 and CitiCorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of such material can be obtained by mail
from the Public Reference Branch of the Commission at 450 West Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. In addition, the Common
Stock is listed on the Nasdaq National Market System and certain of such
materials may be inspected at the offices of the National Association of
Securities Dealers, Inc. at 1735 K Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement on
Form S-3 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act with respect to the
securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which
were omitted in accordance with the rules and regulations of the Commission.
For further information, reference is hereby made to the Registration
Statement. 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 so filed. Each such statement
is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(i) Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1995;
(ii) Quarterly Report on Form 10-QSB for the fiscal quarter ended
March 31, 1996 as amended by the Quarterly Report on Form
10-QSB/A for the fiscal quarter ended March 31, 1996, dated
May 15, 1996; and
(iii) The description of the Company's capital stock contained in
the Company's registration statements filed under Section 12
of the Exchange Act, including any amendment or report filed
for the purpose of updating such description filed with the
Commission pursuant to Section 13 of the Exchange Act.
All documents filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the securities offered hereby 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. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this 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 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> 5
The Company will provide without charge to each person to whom a copy
of this Prospectus is delivered, upon the written or oral request of such
person, a copy of any or all of the documents which are incorporated by
reference herein, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Requests
should be directed to David O. Rodrigue, Vice President, Chief Financial
Officer and Secretary, at the Company's principal executive offices.
-3-
<PAGE> 6
THE COMPANY
Positron Corporation designs, manufactures, markets and services its
POSICAM(TM) systems, advanced medical imaging devices, which utilize positron
emission tomography ("PET") technology. Unlike other currently available
imaging technologies, PET technology permits the measurement of the biological
processes of organs and tissues as well as producing anatomical and structural
images. POSICAM(TM) systems incorporate patented and proprietary technology,
enabling physicians to diagnose and treat patients in the areas of cardiology,
neurology and oncology. The United States Food and Drug Administration
approved the initial POSICAM(TM) system for marketing in 1985, and as of the
date of this Prospectus, the Company has sold 19 POSICAM(TM) systems, of which
15 are currently operational in leading medical facilities in the United
States, two are installed in the international medical institutions and two are
no longer operational. The Company presently markets its POSICAM(TM) systems
at prices ranging from $1.0 million to $1.8 million depending upon the
configuration and equipment options of the particular system.
PET technology is an advanced imaging technique which permits the
measurement of the biological processes of organs and tissues as well as
producing anatomical and structural images. Other advanced imaging techniques,
such as magnetic resonance imaging ("MRI") and computerized axial tomography
("CAT scans"), produce anatomical and structural images, but do not image or
measure biological processes. The ability to measure biological abnormalities
in tissues and organs allows physicians to detect disease at an early stage and
provides physicians with information, which would otherwise be unavailable, to
diagnose and manage the treatment of disease.
Commercial utilization of PET technology commenced in the mid-1980s
and the Company is one of three major commercial manufacturers of PET imaging
systems in the United States. Although the other two major manufacturers are
substantially larger companies, the Company believes that its POSICAM(TM)
systems have proprietary operational and performance characteristics which give
it certain performance advantages over other commercially available PET
systems. Such performance advantages include the POSICAM(TM) systems' high
count rate sensitivity which results in faster and more accurate imaging, an
enhanced ability to use certain types of radiopharmaceuticals and minimize
patient exposure to radiation and its ability to minimize false positive and
false negative diagnoses of disease. Based on industry information, the
Company estimates that 67 PET systems have been commercially installed in the
United States. The Company estimates 65 of these systems are currently being
used in medical institutions. Of the 67 PET systems, the Company has sold and
installed 17 PET systems (15 of which are currently operational), and the
Company believes that the other two major manufacturers of commercial PET
systems have together sold and installed 36 PET systems.
The Company's primary focus to date has been on the clinical
cardiology market, where its POSICAM(TM) systems have been used to assess the
effect of arterial blockages and heart damage due to heart attacks. In 1994
and 1995, the Company made technological advances which allowed it to market
its products to the neurological and oncological markets as well. Neurological
applications of POSICAM(TM) systems include diagnoses of certain brain
disorders, such as epileptic seizures, dementia, stroke, Alzheimer's disease,
Pick's disease and Parkinson's disease. In oncology, POSICAM(TM) IS used in
the diagnosis and evaluation of tumors of the bone and various organs and
tissues such as the brain, colon and breast.
The Company was incorporated under Texas law on December 20, 1983, and
commenced commercial operations in 1986. The Company's executive officers are
located at 16350 Park Ten Place, Houston, Texas 77084, and its telephone number
is (713) 492-7100.
USE OF PROCEEDS
The Company will not receive any proceeds from this offering. This
offering is being made by the Selling Shareholders pursuant to registration
rights granted in connection with the 1996 Private Offering and the issuance of
the Josephthal Securities. See "Description of Securities To Be
Registered--Registration Rights." The Company will pay all of the expenses of
the offering.
-4-
<PAGE> 7
RISK FACTORS
THE OFFERED SECURITIES INVOLVE A HIGH DEGREE OF RISK. PROSPECTIVE
PURCHASERS SHOULD CAREFULLY CONSIDER, AMONG OTHER THINGS, THE RISK FACTORS SET
FORTH IN ITEM 1 "DESCRIPTION OF BUSINESS--RISK ASSOCIATED WITH BUSINESS
ACTIVITIES" CONTAINED IN THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1995.
FORWARD LOOKING STATEMENTS
As identified therein, certain of the documents incorporated herein by
reference do and will contain statements that are forward looking statements
that involve risks and uncertainties. Accordingly, as described therein, no
assurances can be given that the actual events and results will not be
materially different from the anticipated events and results described in the
forward looking statements.
SELLING SHAREHOLDERS
Assuming the conversion of all of the currently outstanding shares of
Series A Preferred Stock and exercise of all of the Common Stock Warrants held
by the Selling Stockholders as of the date of this Prospectus, the following
table sets forth the name of each Selling Shareholder and relationship, if any,
with the Company and (i) the number of shares of Common Stock that would be
owned by each Selling Shareholder, (ii) the maximum number of shares of Common
Stock which may be offered for the account of such Selling Shareholder under
this Prospectus, and (iii) the amount and percentage of Common Stock to be
owned by the Selling Shareholder after the completion of the Offering assuming
the sale of all the Common Stock which may be offered hereunder. As of the
date of this Prospectus, none of the Series A Preferred Stock have been
converted into shares of Common Stock, none of the Common Stock Warrants been
exercised for shares of Common Stock, nor have any of the Series A Preferred
Stock reserved for issuance in payment of dividends accrued on the outstanding
Series A Preferred Stock been issued.
<TABLE>
<CAPTION>
Amount and
Percentage of
Maximum Number of Common Stock
Name of Selling Shareholder and Shares Owned Prior Shares Which May Owned After the
Relationship to Company to Offering (1) Be Sold Hereunder Offering (2)(%)
---------------------------------------------- --------------------- --------------------- ----------------------
<S> <C> <C> <C>
Susan D. Adelman . . . . . . . . . . . . . . 8,334 8,334 *
Marcos Anszelowicz . . . . . . . . . . . . . 40,001 40,001 *
Paul F. Ander and Arlis Ander . . . . . . . . 15,000 15,000 *
Kris Ander and Mary L. Ander . . . . . . . . 15,000 15,000 *
Thomas & Carol Anderson . . . . . . . . . . . 15,000 15,000 *
Arbor Interiors Pension Fund . . . . . . . . 15,000 15,000 *
Jan Arnett, MD . . . . . . . . . . . . . . . 50,000 50,000 *
Associates in Venture Management Inc. 15,000 15,000 *
Auer & Co. . . . . . . . . . . . . . . . . . 600,000 600,000 *
Matthew Balk . . . . . . . . . . . . . . . . 20,882 20,882 *
Zelie Berenbaum . . . . . . . . . . . . . . . 15,000 15,000 *
Bertin Engineering Associates Inc.
Profit Sharing Plan . . . . . . . . . . . . . 15,000 15,000 *
Girish Bhargava . . . . . . . . . . . . . . . 15,000 15,000 *
Edwin R. Bindseil . . . . . . . . . . . . . . 10,500 10,500 *
Bradley Resources Company . . . . . . . . . . 15,000 15,000 *
Kevin A. Brousell . . . . . . . . . . . . . . 16,667 16,667 *
Robert Burkhardt . . . . . . . . . . . . . . 15,000 15,000 *
Anthony J. Cantone . . . . . . . . . . . . . 100,000 100,000 *
P.J. & E.S. Carroll . . . . . . . . . . . . . 10,500 10,500 *
Clarion Capital Corporation . . . . . . . . . 350,000 350,000 *
Lawrence A. Cook . . . . . . . . . . . . . . 25,001 25,001 *
Joseph Cordani . . . . . . . . . . . . . . . 15,000 15,000 *
Donald R. Couch . . . . . . . . . . . . . . . 25,001 25,001 *
Pamela M. D'Ambrosio . . . . . . . . . . . . 15,000 15,000 *
</TABLE>
-5-
<PAGE> 8
<TABLE>
<CAPTION>
Amount and
Percentage of
Maximum Number of Common Stock
Name of Selling Shareholder and Shares Owned Prior Shares Which May Owned After the
Relationship to Company to Offering (1) Be Sold Hereunder Offering (2)(%)
---------------------------------------------- --------------------- --------------------- ----------------------
<S> <C> <C> <C>
Richard David . . . . . . . . . . . . . . . . 20,000 20,000 *
Dhb Capital Group, Inc. . . . . . . . . . . . 175,001 175,001 *
M. Janet DiGiulio . . . . . . . . . . . . . . 15,000 15,000 *
William Dioguardi . . . . . . . . . . . . . . 800 800 *
E&M Rp Trust . . . . . . . . . . . . . . . . 100,000 100,000 *
Dennis J. Eaton . . . . . . . . . . . . . . . 10,500 10,500 *
Hisham Elzanaty . . . . . . . . . . . . . . . 15,000 15,000 *
Richard C. Ernest . . . . . . . . . . . . . . 25,001 25,001 *
Yoursey Faragalla . . . . . . . . . . . . . . 25,001 25,001 *
Raymond Faulkner . . . . . . . . . . . . . . 15,000 15,000 *
Arthur L. Filion and Grace M. Filion . . . . 15,000 15,000 *
Charles Fischer . . . . . . . . . . . . . . . 15,000 15,000 *
Paul Fitzgerald . . . . . . . . . . . . . . . 69,150 69,150 *
Donald F. Frazee . . . . . . . . . . . . . . 50,000 50,000 *
Leonard A. Fritz . . . . . . . . . . . . . . 10,500 10,500 *
David Fuchs . . . . . . . . . . . . . . . . . 10,080 10,080 *
FutureVision Wireless Cable, Inc. . . . . . . 50,000 50,000 *
Jeffrey Goldstein . . . . . . . . . . . . . . 15,000 15,000 *
Achille M. Guest . . . . . . . . . . . . . . 25,001 25,001 *
Anthony Guzzi . . . . . . . . . . . . . . . . 239 239 *
James L. Hadnott M.D. . . . . . . . . . . . . 15,000 15,000 *
Kent Hamilton . . . . . . . . . . . . . . . . 30,000 30,000 *
Irvin A. Hansen . . . . . . . . . . . . . . . 15,000 15,000 *
Bruce A. and Mary T. Haverberg . . . . . . . 25,001 25,001 *
Delaware Charter Guarantee & Trust Company
Custodian for Ronald Heller IRA . . . . . . . 50,000 50,000 *
Virgnia Hart Horner Trust U/A/D 4/19/85 . . . 10,500 10,500 *
D. Lyod Hunter . . . . . . . . . . . . . . . 15,000 15,000 *
Richard INCONTRO . . . . . . . . . . . . . . 15,000 15,000 *
Intergalactic Growth Fund Inc. . . . . . . . 25,001 25,001 *
Betty Iu, M.D. . . . . . . . . . . . . . . . 15,000 15,000 *
Jamscor Inc. . . . . . . . . . . . . . . . . 100,000 100,000 *
Michael Jackson . . . . . . . . . . . . . . . 25,001 25,001 *
David Jaroslawicz . . . . . . . . . . . . . . 25,001 25,001 *
Henry Kolpan . . . . . . . . . . . . . . . . 15,000 15,000 *
Kingsgate Capital Appreciation Fund L.P. . . 25,001 25,001 *
Delaware Charter Guarantee & Trust Company
Custodian for Walter Krzanowski . . . . . . . 15,000 15,000 *
Frank K. Kriz Jr. Profit Sharing Plan . . . . 15,000 15,000 *
Frank K. Kriz Jr. Pension Plan . . . . . . . 15,000 15,000 *
Joseph LaGrassa . . . . . . . . . . . . . . . 15,000 15,000 *
N.C. Joseph Lai . . . . . . . . . . . . . . . 25,001 25,001 *
Michael Loew . . . . . . . . . . . . . . . . 15,136 15,136 *
Robert J. Mahon . . . . . . . . . . . . . . . 15,000 15,000 *
Emerson Martin . . . . . . . . . . . . . . . 33,600 33,600 *
William T. McCaffrey . . . . . . . . . . . . 25,001 25,001 *
Delaware Charter Guarantee & Trust Company
Custodian for Victor Melnichuk MPP . . . . . 15,000 15,000 *
John Mickowski . . . . . . . . . . . . . . . 17,500 17,500 *
Charles M. Miller . . . . . . . . . . . . . . 12,500 12,500 *
Leddy M. & Robert P. Miller . . . . . . . . . 10,500 10,500 *
Morgan Instruments Inc. . . . . . . . . . . . 70,000 70,000 *
Morgan Steel Limited . . . . . . . . . . . . 15,000 15,000 *
Angelo R. Mozilo . . . . . . . . . . . . . . 15,000 15,000 *
James H. Murphy . . . . . . . . . . . . . . . 10,500 10,500 *
Charles H. Nash . . . . . . . . . . . . . . . 25,001 25,001 *
Michael Nevins . . . . . . . . . . . . . . . 15,000 15,000 *
Allen Notowitz . . . . . . . . . . . . . . . 10,500 10,500 *
Alfred Olonoff . . . . . . . . . . . . . . . 25,001 25,001 *
De Kiam Ong, M.D. . . . . . . . . . . . . . . 15,000 15,000 *
Gerald W. Padwe . . . . . . . . . . . . . . . 25,001 25,001 *
</TABLE>
-6-
<PAGE> 9
<TABLE>
<CAPTION>
Amount and
Percentage of
Maximum Number of Common Stock
Name of Selling Shareholder and Shares Owned Prior Shares Which May Owned After the
Relationship to Company to Offering (1) Be Sold Hereunder Offering (2)(%)
---------------------------------------------- --------------------- --------------------- ----------------------
<S> <C> <C> <C>
Joseph Pontarelli . . . . . . . . . . . . . . 15,000 15,000 *
J. Phillip Pruitt . . . . . . . . . . . . . . 25,001 25,001 *
Dan Purjes . . . . . . . . . . . . . . . . . 305,727 305,727 *
Lawrence Rice . . . . . . . . . . . . . . . . 26,860 26,860 *
Charles Roden . . . . . . . . . . . . . . . . 19,866 19,866 *
Matthew Saltzman IRA . . . . . . . . . . . . 15,000 15,000 *
Averell Satloff . . . . . . . . . . . . . . . 5,460 5,460 *
Philip L. Savage . . . . . . . . . . . . . . 15,000 15,000 *
Peter Sheib . . . . . . . . . . . . . . . . . 61,008 61,008 *
Philip B. Smith . . . . . . . . . . . . . . . 25,001 25,001 *
Donald & Eleanor Sorensen . . . . . . . . . . 25,001 25,001 *
Gary Spiro . . . . . . . . . . . . . . . . . 15,000 15,000 *
Vito Stamato Family Limited Partnership . . . 50,000 50,000 *
Richard E. Stites and Jane L. Stites . . . . 50,000 50,000 *
William B. Sweeney . . . . . . . . . . . . . 35,501 35,501 *
Delaware Charter Guarantee & Trust Company
Custodian for Robert L. Taylor, M.D. . . . . 50,000 50,000 *
Delaware Charter Guarantee & Trust Company
Custodian For Vincent M. Tonne . . . . . . . 10,500 10,500 *
Uro-Tech, Ltd (4) . . . . . . . . . . . . . . 1,314,132 650,000 664,132(17.1%)
Scott A. Weisman . . . . . . . . . . . . . . 19,192 19,192 *
Bruce J. Wigo . . . . . . . . . . . . . . . . 15,000 15,000 *
Willingham Family LLC . . . . . . . . . . . . 15,000 15,000 *
John H. Wilson . . . . . . . . . . . . . . . 69,829 50,000 19,829*
J. Michael Wolfe . . . . . . . . . . . . . . 100,002 100,002 *
Richard Wurzburg, Jr. . . . . . . . . . . . . 25,001 25,001 *
Harvey Yates . . . . . . . . . . . . . . . . 15,000 15,000 *
Chyi Yu & Chi Su Yu . . . . . . . . . . . . . 15,000 15,000 *
-------------------------------------------------------------------------
TOTAL 5,996,986 5,313,025(5)
</TABLE>
____________________________
*Less than 1%.
(1) Assumes the conversion of all of the Series A Preferred Stock and
exercise of all of the Common Stock Warrants held by the Selling
Stockholders.
(2) Assumes the sale of all shares of Common Stock registered hereunder,
although none of the Selling Shareholders are under any obligation
known to the Company to sell any shares of Common Stock.
(3) Josephthal acted as sole managing underwriter of the Company's initial
public offering in December of 1993, for which it received customary
commissions and the Underwriter's Warrant issued by the Company
pursuant to the Underwriter's Warrant Agreement dated December 3,
1993.
(4) Includes 440,067 shares of Common Stock owned by Uro-Tech, Ltd., a
Texas limited partnership, the general partner of which is Uro-Tech
Management Corporation, a wholly-owned subsidiary of OmniMed
Corporation ("OmniMed"). Includes 156,565 shares of Common Stock
issuable upon the exercise of Series E Warrants held by Uro-Tech, Ltd.
Also includes 67,500 shares issuable upon the exercise of warrants
acquired by Uro-Tech, Ltd. in connection with a loan extended by
Uro-Tech, Ltd. to the Company. Dr. Gary B. Wood is Chairman of the
Board of Directors of the Company, and beneficially owns 63.7% of the
outstanding voting securities, of OmniMed.
(5) Does not include any of the 700,000 shares of Series A Preferred Stock
reserved for issuance to the Selling Stockholders in payment of
dividends accrued on the outstanding Series A Preferred Stock. Such
shares may be issued from time to time, if at all, after July 1, 1996.
Also does not include an indeterminate number of additional shares of
Common Stock which also may become issuable upon the conversion of the
Series A Preferred Stock or the exercise of the Common Stock Warrants
pursuant to the anti-dilution provisions thereof.
The Company will pay the expenses of registering the shares of Common
Stock being sold hereunder which are estimated to be $61,000.
-7-
<PAGE> 10
PLAN OF DISTRIBUTION
The Offered Securities consist of up to an aggregate of 5,313,025
shares of Common Stock that are issuable to the Selling Shareholders upon
conversion of the Company's currently outstanding Series A Preferred Stock, upon
conversion of the Series A Preferred Stock reserved for issuance to the Selling
Stockholders from time to the time after July 1, 1996, if at all, in payment of
dividends accrued on the outstanding Series A Preferred Stock, upon exercise of
the Common Stock Warrants and upon conversion and exercise of the Josephthal
Securities. The Offered Securities may be sold from time to time by the Selling
Shareholders. The Selling Shareholders may from time to time sell all or a
portion of the Offered Securities in transactions on The Nasdaq Stock Market (on
either the Nasdaq National Market or the Nasdaq Smallcap Market, as the Common
Stock may then be listed thereon for trading), in the over-the-counter market,
in negotiated transactions or a combination of such methods of sale, at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. The Offered Securities may be sold
directly or through broker-dealers. If shares of Common Stock are sold through
broker-dealers, the Selling Shareholders may pay brokerage commissions and
charges. The methods by which the Offered Securities may be sold include (a) a
block trade (which may involve crosses) in which the broker or dealer so engaged
will attempt to sell the securities as agent but may position and resell a
portion of the block as principal to facilitate the transaction; (b) purchases
by a broker or dealer as principal and resale by such broker or dealer for its
own account pursuant to this Prospectus; (c) exchange distributions and/or
secondary distributions in accordance with the rules of The Nasdaq Stock Market;
(d) ordinary brokerage transactions and transactions in which the broker
solicits purchasers; and (e) privately negotiated transactions.
Pursuant to the registration provisions of the subscription agreements
entered into by and between the Company and each Selling Shareholder, each
Selling Shareholder has agreed with the Company that, unless the Company
otherwise consents, he will not, directly or indirectly, offer or sell more
than the following percentage of his Offered Securities (based upon the number
of Offered Securities initially owned by such Selling Shareholder) during the
following periods from and the following dates:
<TABLE>
<CAPTION>
Percentage of Offered Securities Held by a Particular
Time Period Selling Shareholder Permitted to be Sold
----------- ----------------------------------------
<S> <C>
Prior to June 3, 1996 None
Prior to August 31, 1996 25%
Prior to November 29, 1996 50%
Prior to February 27, 1997 75%
After February 28, 1997 100%
</TABLE>
Pursuant to such registration provisions of the subscription
agreements, the Selling Shareholders will pay their costs and expenses of
selling the shares of Common Stock offered hereunder, including commissions and
discounts of underwriters, brokers, dealers, or agents, and the Company has
agreed to pay the costs and expenses incident to its registration and
qualification of the Common Stock offered hereby, including registration and
filing fees. In addition, the Company has agreed to indemnify the Selling
Shareholders against certain liabilities, including liabilities arising under
the Securities Act.
The Selling Shareholders and any broker-dealer participating in the
distribution of the Offered Securities may be deemed to be "underwriters"
within the meaning of the Securities Act, and any profit and any commissions
paid or any discounts or concessions allowed to any such broker-dealer may be
deemed to be underwriting discounts and commissions under the Securities Act.
The Selling Shareholders may indemnify any broker-dealer that participates in
transactions involving the sale of shares of Common Stock against certain
liabilities, including liabilities under the Securities Act.
There can be no assurances that the Selling Shareholders will either
convert any of the Series A Preferred Stock or exercise any of the Common Stock
Warrants or, in the case of any such conversion or exercise, sell any or all of
the shares of the Offered Securities issued upon such conversion or exercise.
-8-
<PAGE> 11
DESCRIPTION OF CAPITAL STOCK AND OPTIONS AND WARRANTS
The Company is incorporated under the laws of the State of Texas.
Under its Articles of Incorporation, the Company is authorized to issue
10,000,000 shares of Preferred Stock, par value $1.00 per share (the "Preferred
Stock"), and 15,000,000 shares of Common Stock, par value $.01 per share. As
of the date of this Prospectus, there are 3,637,320 shares of Common Stock and
2,691,992 shares of Series A Preferred Stock issued and outstanding. Except
for the issued and outstanding Series A Preferred Stock, as of the date of this
Prospectus, there are no other shares of Preferred Stock issued and
outstanding. In addition, 6,956,787 shares of Common Stock are issuable
pursuant to outstanding options and warrants discussed below.
COMMON STOCK
The holders of Common Stock are entitled to one vote for each share
held of record on each matter submitted to a vote of shareholders. Holders of
Common Stock may not cumulate their votes in the election of directors, which
means the holders of a majority of the outstanding Common Stock entitled to
vote in any election of directors may elect all of the directors then being
elected.
Holders of shares of Common Stock are entitled to receive such
dividends, if any, as may be declared in the discretion of the Board of
Directors from sources legally available therefore, subject to any limitations
which may be imposed by the terms of any outstanding series of Preferred Stock.
At this time, the Company does not anticipate paying any cash dividends for the
foreseeable future.
Upon any dissolution of the Company, holders of Common Stock would be
entitled to share pro rata in the assets after payment of corporate debts and
expenses and all other priority claims, including the claims of holders of
shares of Preferred Stock that may be issued and outstanding, including the
Series A Preferred Stock.
The shares of Common Stock currently outstanding are, and when issued
the shares of Common Stock issuable upon conversion of the Series A Preferred
Stock or exercise of the Common Stock Warrants will be, fully paid and non-
assessable. The Common Stock has no pre-emptive, subscription, redemption or
conversion rights. The rights, preferences and privileges of holders of Common
Stock are subject to, and may be adversely affected by, the rights of holders
of the existing Series A Preferred Stock and holders of any other shares of any
series of Preferred Stock that the Company may designate and issue in the
future.
PREFERRED STOCK
The Company's Articles of Incorporation authorize the Board of
Directors to issue 10,000,000 shares of Preferred Stock from time to time in
one or more series. The Board of Directors is authorized to determine, prior
to issuing any such series of Preferred Stock and without any vote or action by
the shareholders, the rights, preferences, privileges and restrictions of the
shares of such series, including dividend rights, voting rights, terms of
redemption, the provisions of any purchase, retirement or sinking fund to be
provided for the shares of any series, conversion and exchange rights, the
preferences upon any distribution of the assets of the Company, including in
the event of voluntary or involuntary liquidation, dissolution or winding up of
the Company, and the preferences and relative rights among each series of
Preferred Stock.
The ability of the Board of Directors of the Company to issue
Preferred Stock, while providing flexibility in connection with acquisitions
and corporate purposes, could have the effect of making it more difficult for a
third party to acquire, or of discouraging a third party from acquiring, a
majority of the outstanding voting stock of the Company. Except for the Series
A Preferred Stock, there is currently no other outstanding Preferred Stock.
Before the Company's initial public offering in December 1993, the
Company had issued shares of Series I Preferred Stock, Series IA Preferred
Stock and Series E Convertible Preferred Stock (the "Series E Preferred
Stock"). All of those shares of preferred stock were converted into shares of
Common Stock in connection with the Company's initial public offering. The
Company granted the holders of the shares of Common Stock into which such
previously outstanding shares of preferred stock were converted certain
registration rights with respect to such shares.
-9-
<PAGE> 12
Series A Preferred Stock
The Company has currently issued and outstanding 3,775,324 shares of
Series A Preferred Stock. Each share of the Series A Preferred Stock is
immediately convertible into one share of Common Stock, unless previously
redeemed, at the option of the holders thereof at any time, subject to
adjustment pursuant to customary anti-dilution provisions. The Company has the
right at any time subsequent to March 5, 1998 to redeem the Series A Preferred
Stock, in whole or in part, for a redemption price of $1.46 per share plus
accrued and unpaid dividends, if any, by written notice mailed at least 30 days
prior to the specified redemption date to each holder of Series A Preferred
Stock at his address as it appears on the books of the Company, provided,
however, that such notice may only be given if, for the 20 consecutive trading
days preceding the notice, the closing price for the Company's Common Stock (if
then trading on the over-the- counter market) is in excess of $2.00 per share.
With respect to matters submitted to a vote of holders of Common
Stock, the holders of Series A Preferred Stock are entitled to a number of
votes equal to the number of shares of Common Stock (including fractional
shares) into which such shares of Series A Preferred Stock are convertible from
time to time. In such case, the holders of Common Stock and Series A Preferred
Stock shall vote together as a class.
Holders of Series A Preferred Stock are entitled to receive cumulative
dividends at the annual rate of 8% of the stated value ($1.33 per share) of the
Series A Preferred Stock. Such dividends are payable semi-annually at the
Company's option, either in cash or in shares of Series A Preferred Stock,
commencing on July 1, 1996.
With respect to the payment of dividends and amounts upon liquidation,
the Series A Preferred Stock will rank senior to the Common Stock, any
additional class of Common Stock and any other series of preferred stock. In
connection with the 1996 Private Offering, the Company agreed not to create or
issue any new class or series of stock of any other securities convertible into
Common Stock which is senior to the Series A Preferred Stock with respect to
voting, dividends or redemption or upon liquidation, dissolution or winding up
of the Company.
For a discussion of the registration rights granted to holders of
Series A Preferred Stock, see "Plan of Distribution."
COMMON STOCK WARRANTS
The Company has currently issued 1,341,701 Common Stock Warrants in
connection with the 1996 Private Offering and 196,000 Common Stock Warrants to
Josephthal in exchange for the Underwriter's Warrant issued pursuant to the
Underwriter's Warrant Agreement dated as of December 3, 1993. The outstanding
Common Stock Warrants are currently exercisable for an aggregate of 1,346,030
shares of Common Stock at an exercise price of $2.00 per share. The Common
Stock Warrants are entitled to the benefit of adjustments in the exercise price
and in the number of shares of Common Stock or other securities deliverable
upon the exercise thereof in the event of a stock dividend, stock split,
reclassification, reorganization, consolidation, merger, sale of all or
substantially all of the property of the Company, or other dilutive
transactions. The Company has the right to reduce the exercise price or
increase the number of shares of Common Stock issuable upon the exercise of the
Common Stock Warrants.
Each Common Stock Warrant expires on February 13, 2001 (the
"Expiration Date"), unless previously redeemed by the Company. The Common
Stock Warrants may be redeemed, in whole or in part, at a price of $.10 per
warrant, by written notice mailed at least 30 days prior to the specified
redemption date, to each holder of Common Stock Warrants at his address as it
appears on the books of the Company. The Company, however, may only give such
notice if, for the 20 consecutive trading days preceding the notice, the
closing price for the Company's Common Stock (if then listed on the Nasdaq
National Market) or the closing bid for the Common Stock (if then traded on the
over-the-counter market) is in excess of $3.50 per share.
For a discussion of the registration rights granted to holders of
Common Stock Warrants, see "Plan of Distribution."
1993 WARRANTS
Prior to the Company's initial public offering, the Company issued
warrants to the purchasers of the Series E Preferred Stock (the "1993
Warrants"), which as originally issued were exercisable for an aggregate of
353,531 shares of Common Stock at an exercise price of $9.90 per share. As of
the date of this Prospectus, as a result of the anti- dilution provisions
contained in the 1993 Warrants, the 1993 Warrants are currently exercisable for
an aggregate of 498,321 shares of Common Stock at an exercise price of $5.83
per share. The 1993 Warrants are exercisable at any time until November 30,
1998. The 1993 Warrants are entitled to the benefit of adjustments in the
exercise price and in the number of shares of Common Stock or other securities
-10-
<PAGE> 13
deliverable upon the exercise thereof in the event of a stock dividend, stock
split, reclassification, reorganization, consolidation, merger, sale of all or
substantially all of the property of the Company, or other dilutive
transactions.
The 1993 Warrants are redeemable at the option of the Company at a
price equal to $.10 per share of the Common Stock covered by the 1993 Warrant,
on 30 days written notice, provided that the market price of the Common Stock
equals or exceeds $12.544 for the 20 consecutive trading days ending within 10
days prior to the notice of redemption.
The Company also granted the holders of the 1993 Warrants certain
registration rights with respect to the 1993 Warrants and the Common Stock for
which the 1993 Warrants are exercisable.
REDEEMABLE WARRANTS
In connection with its initial public offering, the Company issued
3,893,550 Redeemable Warrants (the "Redeemable Warrants"). The Redeemable
Warrants as originally issued were exercisable for an aggregate of 3,893,550
shares of Common Stock at an exercise price of $8.25 per share. As of the date
of this Prospectus, as a result of the anti-dilution provisions contained in
the Redeemable Warrants, the Redeemable Warrants are currently exercisable for
an aggregate of 5,916,017 shares of Common Stock at an exercise price of $5.83
per share. The Redeemable Warrants are entitled to the benefit of adjustments
in the exercise price and in the number of shares of Common Stock or other
securities deliverable upon the exercise thereof in the event of a stock
dividend, stock split, reclassification, reorganization, consolidation, merger,
sale of all or substantially all of the property of the Company, or other
dilutive transactions. The Company has the right to reduce the exercise price
or increase the number of shares of Common Stock issuable upon the exercise of
the Redeemable Warrants.
Each Redeemable Warrant expires on December 3, 1998 (the "Expiration
Date"), subject to extension. The Company may at any time extend the
Expiration Date of all outstanding Redeemable Warrants for such increased
period of time as it may determine.
The Company has the right at any time after March 3, 1995, to redeem
the Redeemable Warrants in whole or in part for cancellation at a price of
$1.25 each, by written notice mailed at least 30 days prior to the redemption
date, to each Redeemable Warrant holder at his address as it appears on the
books of the warrant agent. Such notice may only be given within 10 days
following any period of 20 consecutive trading days during which the average
closing bid for the Common Stock (if then trading on the over-the-counter
market) or the average closing price of the Common Stock (if then listed on the
Nasdaq National Market) equals or exceed $12.544 per share, subject to
adjustment for stock dividends, splits and similar events. If the Redeemable
Warrants are called for cancellation, they must be exercised prior to the close
of business on the date of any such redemption and cancellation or the right to
purchase the applicable shares of Common Stock is forfeited.
The Company granted the holders of the Redeemable Warrants certain
registration rights with respect to the Common Stock for which the Redeemable
Warrants are exercisable.
EMPLOYEE STOCK OPTIONS AND OTHER OPTIONS AND WARRANTS
The Company may grant officers, directors and key employees stock
options with respect to the Company's Common Stock under the Company's Amended
and Restated 1987 Stock Option Plan (the "1987 Stock Option Plan). The number
of shares of Common Stock that may be issued under the 1987 Stock Option Plan
is 188,522 shares. As of the date of this Prospectus, the Company has granted
options under the 1987 Stock Option Plan for 171,091 shares of Common Stock at
an exercise price of $2.625 per share. The options granted pursuant to the 1987
Stock Option Plan are exercisable at any time until June, 2005. Options granted
under the 1987 Stock Option Plan are entitled to the benefit of adjustments in
the exercise price and in the number of shares of Common Stock or other
securities deliverable upon the exercise thereof in the event of a stock
dividend, stock split, reclassification, reorganization, consolidation, merger,
sale of all or substantially all of the property of the Company, or other
dilutive transactions.
The Company may grant officers, directors, key employees and
non-employees stock options with respect to the Company's Common Stock under
the Company's 1994 Incentive and Non-Statutory Option Plan (the "1994 Stock
Option Plan"). Subject to adjustment as set forth in the 1994 Stock Option
Plan, 441,833 shares of Common Stock may be the subject of awards to directors,
officers and employees of the Company. The 1994 Stock Option Plan also provides
that 160,000 additional options may be granted to non-employee directors at the
discretion of the Company. As of the date of this
-11-
<PAGE> 14
Prospectus, the Company has granted employee options for 399,390 shares at
exercise prices between $2.00 and $3.75 per share. As of the date of this
Prospectus, non-employee directors held options for 138,724 shares of Common
Stock under the 1994 Stock Option Plan at exercise prices between $2.625 and
$4.125 per share.
Options granted under the 1994 Stock Option Plan are entitled to the
benefit of adjustments in the exercise price and in the number of shares of
Common Stock or other securities deliverable upon the exercise thereof in the
event of a stock dividend, stock split, reclassification, reorganization,
consolidation, merger, sale of all or substantially all of the property of the
Company, or other dilutive transactions.
In September 1995, the Board of Directors authorized the issuance of
options not under the 1987 Stock Option Plan or the 1994 Stock Option Plan for
up to 80,929 shares for Common Stock to key employees at an exercise price of
$3.75 per share, the actual granting of such options are contingent upon the
Company consummating certain transactions. As of the date of this Prospectus,
the contingency has not been satisfied and these options have not been issued.
At various times since its formation, the Company has also issued
warrants exercisable for Common Stock to certain individuals for various
services rendered to the Company. As of the date of this Prospectus, 245,061
of the following additional warrants were issued and outstanding:
<TABLE>
<CAPTION>
Number of Options Exercise Price
----------------- --------------
<S> <C>
13,679 $25.59
43,882 8.25
25,000 3.875
50,000 2.625
67,500 2.00
45,000 2.00
</TABLE>
Of the 245,061 warrants issued, no warrants have been exercised as of
the date of this Prospectus. Each warrant expires at various time between 1997
and 2006.
LEGAL MATTERS
The validity of the Securities offered hereby has been passed upon for
the Company by Vinson & Elkins, L.L.P., 3700 Trammell Crow Center, 2001 Ross
Avenue, Dallas, Texas 75201-2975.
EXPERTS
The balance sheets as of December 31, 1994 and 1995, and the
statements of operations, shareholders' equity (deficit) and cash flows for the
years ended December 31, 1994 and 1995 of the Company incorporated by reference
in this Prospectus from the Company's Annual Report on Form 10-KSB, to the
extent and for the periods indicated in their report, have been audited by
Coopers & Lybrand L.L.P., independent public accountants, as indicated in their
report with respect thereto, and have been so incorporated in reliance upon the
authority of said firm as experts in accounting and auditing.
-12-
<PAGE> 15
================================================================================
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made by this Prospectus and, if given
or made, such information or representations must not be relied upon as having
been authorized by the Company, by any Selling Shareholder or underwriter.
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
affairs of the Company since the date hereof. This Prospectus does not
constitute an offer or solicitation by anyone in any state in which such offer
or solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so to anyone to whom it is unlawful to make
such offer or solicitation.
_____________________
TABLE OF CONTENTS
Page
----
Available Information . . . . . . . . . . . . . . . . . . . . 2
Incorporation of Certain Information by Reference . . . . . . 2
The Company . . . . . . . . . . . . . . . . . . . . . . . . . 4
Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . 5
Forward Looking Statements . . . . . . . . . . . . . . . . . 5
Selling Shareholders . . . . . . . . . . . . . . . . . . . 5
Plan of Distribution . . . . . . . . . . . . . . . . . . . . 7
Description of Capital Stock and Options and Warrants . . . 8
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . 12
Experts . . . . . . . . . . . . . . . . . . . . . . . . . . 12
================================================================================
================================================================================
POSITRON CORPORATION
5,313,025 SHARES
OF COMMON STOCK
____________
Prospectus
____________
June 12, 1996
================================================================================
-13-
<PAGE> 16
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses, all of which will be paid by the Registrant, in
connection with the registration of the Common Stock offered hereby, other than
commissions, are as follows:
<TABLE>
<S> <C>
SEC Registration Fee . . . . . . . . . . . . . . . . . . . . . . . . $5,617
NASD Filing Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . -0-
The Nasdaq Stock Market Listing Fee . . . . . . . . . . . . . . . . . 17,500
Printing and Engraving Expenses* . . . . . . . . . . . . . . . . . . 2,500
Legal Fees and Expenses* . . . . . . . . . . . . . . . . . . . . . . 15,000
Accounting Fees and Expenses* . . . . . . . . . . . . . . . . . . . . 10,000
"Blue Sky" Fees and Expenses* . . . . . . . . . . . . . . . . . . . . 10,000
Transfer Agent and Registrar Fees* . . . . . . . . . . . . . . . . . -0-
Miscellaneous* . . . . . . . . . . . . . . . . . . . . . . . . . . . 383
-------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $61,000
=======
</TABLE>
_______________
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Articles of Incorporation of Positron Corporation (the
"Registrant") provides that directors and former directors of the Registrant
shall not be liable to the Registrant or its shareholders for monetary damages
for breach of fiduciary duty as a director except (i) for any breach of the
director's duty of loyalty to the Registrant or its shareholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) in respect of certain unlawful dividend
payments or stock redemptions or repurchases or (iv) for any transaction from
which the director derived an improper benefit.
The Registrant's By-laws grant mandatory indemnification to directors
and officers of the Registrant to the fullest extent authorized under the Texas
Business Corporation Act. In general, a Texas corporation may indemnify an
officer or director who was, is or is threatened to be made a named defendant
or respondent in a proceeding by virtue of his position in the corporation if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and, in the case of criminal
proceedings, had no reasonable cause to believe his conduct was unlawful. A
Texas corporation may indemnify an officer or director in an action brought by
or in the right of the corporation only if such officer or director was not
found liable to the corporation, unless or only to the extent that a court
finds him to be fairly and reasonably entitled to indemnity for such expenses
as the court deems proper.
The Registrant has entered into separate indemnification agreements
with each of its directors pursuant to which the Registrant has agreed to
indemnify each director to the extent permitted under The Texas Business
Corporation Act.
II-1
<PAGE> 17
ITEM 16. EXHIBITS
*4.1 -- Statement of Designation Establishing Series A 8% Cumulative
Convertible Redeemable Preferred Stock of Positron Corporation
**4.2 -- Warrant Agreement dated February 29, 1996, by and between
Positron Corporation and Continental Stock Transfer & Trust
Company
**4.3 -- Form of Subscription Agreement entered into between Positron
Corporation and each of the subscribers of Units consisting of
the Series A 8% Cumulative Convertible Redeemable Preferred
Stock and the Redeemable Common Stock Purchase Warrants
**4.4 -- Specimen Stock Certificate representing the Series A 8%
Cumulative Convertible Redeemable Preferred Stock
**4.5 -- Specimen Warrant Certificate representing the Redeemable Common
Stock Purchase Warrants **5.1 -- Opinion of Vinson & Elkins
L.L.P.
+23.1 -- Consent of Coopers & Lybrand L.L.P.
**23.2 -- Consent of Vinson & Elkins L.L.P. (included as a part of Exhibit
5.1)
**24.1 -- Power of Attorney (included on the signature page of Part II of
this Registration Statement).
* The item listed is incorporated by reference herein to the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1995.
**Previously Filed.
+ Filed Herewith.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) That it will file, during any period in which it offers or
sells securities, a post-effective amendment to this registration statement
to:
(i) Include any prospectus required by section 10(a)(3)
of the Securities Act;
(ii) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement; and
(iii) Include any additional or changed material
information on the plan of distribution.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to the Exchange Act that are incorporated by reference in the
registration statement.
(2) That for determining liability under the Securities Act, it
will treat each post-effective amendment as a new registration statement of
the securities offered, and the offering of the securities at that time to be
the initial bona fide offer.
(3) To file a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the offering.
Insofar as indemnification for liabilities arising under the Act may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE> 18
SIGNATURES
In accordance with 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 of filing on Form S-3 and authorized this Registration
Statement to be signed on its behalf by the undersigned, in the city of
Houston, State of Texas on the 12th day of June, 1996.
POSITRON CORPORATION
By: *
-------------------------------------
Werner J. Haas, Ph.D.
President and Chief Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement was signed by the following persons in the capacities
and on the dates stated.
<TABLE>
<CAPTION>
Signatures Capacity Date
---------- -------- ----
<S> <C> <C>
* President, Chief Executive Officer (Principal June 12, 1996
------------------------------------------ Executive Officer); Director
Werner J. Haas, Ph.D.
* Chief Financial Officer and Secretary June 12, 1996
------------------------------------------- (Principal Financial and Accounting Officer)
David O. Rodrigue
/S/ GARY B. WOOD Chairman of the Board and Director June 12, 1996
-------------------------------------------
Gary B. Wood, Ph. D.
* Director June 12, 1996
------------------------------------------
Robert M. Guezuraga
* Director June 12, 1996
------------------------------------------
K. Lance Gould, M.D.
* Director June 12, 1996
------------------------------------------
F. David Rollo, M.D. Ph.D.,FACNP
* Director June 12, 1996
------------------------------------------
John H. Laragh, M.D.
* Director June 12, 1996
------------------------------------------
Ronald B. Schilling, Ph.D.
* Director June 12, 1996
------------------------------------------
William S. Kiser, M.D.
* /S/ GARY B. WOOD Attorney-in-Fact June 12, 1996
-------------------------------------------
GARY B. WOOD
</TABLE>
<PAGE> 19
INDEX TO EXHIBITS
Exhibit
Number Description
- ------- -----------
*4.1 -- Statement of Designation Establishing Series A 8% Cumulative
Convertible Redeemable Preferred Stock of Positron Corporation
**4.2 -- Warrant Agreement dated February 29, 1996, by and between
Positron Corporation and Continental Stock Transfer & Trust
Company
**4.3 -- Form of Subscription Agreement entered into between Positron
Corporation and each of the subscribers of Units consisting of
the Series A 8% Cumulative Convertible Redeemable Preferred
Stock and the Redeemable Common Stock Purchase Warrants
**4.4 -- Specimen Stock Certificate representing the Series A 8%
Cumulative Convertible Redeemable Preferred Stock
**4.5 -- Specimen Warrant Certificate representing the Redeemable Common
Stock Purchase Warrants **5.1 -- Opinion of Vinson & Elkins
L.L.P.
+23.1 -- Consent of Coopers & Lybrand L.L.P.
**23.2 -- Consent of Vinson & Elkins L.L.P. (included as a part of
Exhibit 5.1)
**24.1 -- Power of Attorney (included on the signature page of Part II of
this Registration Statement).
* The item listed is incorporated by reference herein to the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1995.
**Previously Filed.
+ Filed Herewith.
<PAGE> 1
EXHIBIT 23.1
[COOPERS & LYBRAND L.L.P. LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Amendment No. 2 on Form S-3
(File No. 333-4006) of our report dated March 25, 1996, on our audits of the
financial statements of Positron Corporation as of December 31, 1994 and 1995,
and for the years ended December 31, 1994 and 1995. We also consent to the
reference to our firm under the caption "Experts".
COOPERS & LYBRAND L.L.P.
Houston, Texas
June 12, 1996
