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As filed with the Securities and Exchange Commission on April 1, 1997
Registration No:___________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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JMAR INDUSTRIES, INC.
(Exact name of Registrant as specified in its charter)
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<S> <C> <C>
DELAWARE 3845 68-0131180
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER IDENTIFICATION
INCORPORATION) CLASSIFICATION CODE NUMBER) NUMBER)
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3956 Sorrento Valley Blvd.
San Diego, California 92121
(619) 535-1706
(Address including zip code and telephone number, including area code of
Registrant's principal executive offices and principal place of
business)
Dennis E. Valentine
Chief Financial Officer
3956 Sorrento Valley Blvd.
San Diego, CA 92121
(619) 535-1706
(Name, address, including zip code and telephone number, including area code,
of agent for service)
Copies to
Joseph G. Martinez, Esq.
Parker, Milliken, Clark, O'Hara & Samuelian
Professional Corporation
333 S. Hope Street, Twenty Seventh Floor
Los Angeles, California 90071-1488
(213) 683-6500
---------------
Approximate date of commencement of proposed sale to the public: As soon
as practicable after the effective date of this Registration Statement.
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
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Title of each Class Amount to be Proposed Maximum Proposed Maximum Amount of
of Securities to be Registered (1) Offering Price Per Aggregate Offering Registration
Registered Share (2) Price (2) Fee
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Common Stock 2,055,477 $2.41 $4,953,700 $1,501.12
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(1) Pursuant to Rule 416, the Registration Statement also relates to an
indeterminate number of Common Stock issuable upon the exercise of warrants
held by the Selling Shareholders pursuant to provisions which provide for a
change in the amount of the Common Stock issuable thereunder to prevent
dilution resulting from stock splits, stock dividends or similar transactions,
which shares of Common Stock are registered hereunder.
(2) Calculated solely for purposes of determining the registration fee and
based on the average of the high and low prices for the Common Stock securities
on March 27, 1997, as reported on NASDAQ.
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 thereunder 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.
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PROSPECTUS
JMAR INDUSTRIES, INC.
2,055,477 Shares
of Common Stock
________________
This Prospectus relates to the sale by certain persons (the "Selling
Stockholders") of 2,055,477 shares of common stock, $.01 par value per share
(the "Common Stock"), of JMAR Industries, Inc., a Delaware corporation (the
"Company"). See "Selling Stockholders". The Company is not offering any
shares hereunder and will not receive any of the proceeds from the sale of
shares by the Selling Stockholders. Certain of the shares offered hereby are
issuable under outstanding warrants held by the Selling Stockholders. The
Company will receive proceeds represented by the exercise price of such
warrants if exercised by the holders thereof. All of the securities registered
hereunder were issued in May, 1996 to the former shareholders of California
ASIC, Inc. See "Prospectus Summary -- The Offering." It is anticipated that
the Selling Stockholders will offer such shares from time to time in the
over-the-counter market at the then prevailing market prices and terms or in
negotiated transactions and without the payment of any underwriting discounts
or commissions, except for usual and customary selling commissions paid to
brokers or dealers. The Selling Stockholders also may sell such shares from
time to time pursuant to Rule 144 under the Securities Act of 1933, as amended
(the "Act").
The Common Stock is traded on the National Association of Securities
Dealers Automated Quotation System National Market System ("NASDAQ - NMS")
under the symbol "JMAR". The closing price for the Common Stock as reported by
NASDAQ was $2.44 on March 27, 1997.
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK
AND SHOULD NOT BE PURCHASED BY ANYONE WHO CANNOT AFFORD THE LOSS OF HIS ENTIRE
INVESTMENT. SEE "RISK FACTORS" ON PAGES 5-8 OF THIS PROSPECTUS FOR A
DESCRIPTION OF SEVERAL RISK FACTORS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
The Company has agreed to bear all of the expenses (other than selling
commissions and fees and expenses of counsel or other advisors to certain of
the Selling Stockholders) in connection with the registration and sale of the
Common Stock being offered by the Selling Stockholders. See "Selling
Stockholders" and "Plan of Distribution." The Company has also agreed to
indemnify certain of the Selling Stockholders against certain liabilities,
including liabilities under the Securities Act of 1933. The total expenses to
be paid by the Company for this offering are estimated at $14,000.
The date of this Prospectus is _______________
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and in accordance
therewith files regular reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by the Company can be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at the following
regional offices: Los Angeles Regional Office, 5757 Wilshire Blvd., Suite 500
East, Los Angeles, California 90036-3648; Chicago Regional Office, Everett
McKinley Dirksen Building, 219 S. Dearborn Street, Room 1704, Chicago, Illinois
60604; New York Regional Office, 7 World Trade Center, New York, New York
10048. Copies of such material may also be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. The Commission also maintains a Website that contains
reports, proxy statements and other information filed by the Company located at
http://www.sec.gov
The Company's Common Stock, Class A Warrants and Units are quoted on
the NASDAQ System. Any such reports, proxy statements or other information
filed by the Company can also be inspected at the offices of the NASDAQ, 1735 K
Street, N.W., Washington, D.C. 20006-1500.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents (or specified portions thereof) filed with the
Commission by the Company are incorporated by reference herein as of their
respective dates and are made a part hereof:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996;
(b) The description of Common Stock contained in "Description of
Securities" in the Company's Registration Statement on Form
8-A, dated April 3, 1990, as amended on a Form 8, dated April
9, 1990, filed pursuant to Section 12(b) of the Exchange Act;
(c) The Company's Form 8-K, filed May 31, 1996, pursuant to
Section 13(a) under the Securities Act of 1934 describing the
acquisition of approximately 94 percent of the outstanding
common stock of California ASIC Technical Services, Inc. and
the Company's Form 8-K/A, filed August 6, 1996 related
thereto.
(d) The Company's Form 8-K, filed January 15, 1997, pursuant to
Section 13(a) under the Securities Act of 1934 describing the
Escrow and Agreement of Settlement and General Release between
the Registrant and Atlantic American Holding Company Limited.
All documents filed by the Company with the Commission 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
hereby shall be deemed to be incorporated herein by reference and shall be a
part hereof from the date of the 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 incorporated or
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.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon written
or oral request, a copy of any or all of the documents that have been
incorporated herein by reference, except for the exhibits to such documents
which are not specifically incorporated herein by reference. Requests should
be directed to Corporate Secretary, JMAR Industries, Inc., 3956 Sorrento Valley
Blvd., San Diego, California 92121; (619) 535-1706.
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PROSPECTUS SUMMARY
The following is a summary of certain information contained in this
Prospectus and is qualified in its entirety by the more detailed information
included herein and incorporated herein by reference.
THE COMPANY
JMAR Industries, Inc. (the "Company" or "JMAR") develops and
manufactures a wide range of precision measurement and manufacturing systems
based on the application of advanced precision light sources, including lasers.
The Company also employs lasers to manufacture specialty semiconductors and is
actively engaged in the development of X-ray lithography, an enabling
technology for the development of future generations of high-performance
semiconductors. JMAR operates through three divisions located in Southern
California:
PACIFIC PRECISION LABORATORIES ("PPL"), the Company's equipment
manufacturing division is located in Chatsworth, California, northwest of Los
Angeles where JMAR's core product lines are produced. These currently include:
Test and Measurement Systems - non-contact systems to measure and inspect
microelectronics (primarily semiconductors and disk drives) parts for both
quality assurance and process control purposes; Motion Control and Positioning
Systems - to improve the precision of microelectronics manufacturing; and Laser
Processing Systems - which perform the highly precise welding, trimming and
cutting required by the microelectronics and medical implant industries.
CALIFORNIA ASIC ("CAL ASIC"), the Company's newly established
quick-turn semiconductor design and fabrication operation located south of Los
Angeles in Irvine.
JMAR TECHNOLOGY CO. ("JTC"), the Company's research and development
center in San Diego where JMAR technologists conceive the products of tomorrow
and refine them for commercial application. The Company conducts its work on
advanced X-ray and optical lithography, new medical products, micromachining,
and other leading-edge product technologies at this location.
JMAR was founded in 1987 and went public in 1990. Its common shares
and warrants to purchase common shares trade on the NASDAQ National Market
System under the symbols: JMAR and JMARW, respectively. The Company maintains
its executive offices at 3956 Sorrento Valley Boulevard, San Diego, California
92121 and its telephone number is (619) 535-1706. Unless otherwise indicated,
all references to the Company include the Company and its subsidiaries.
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<PAGE> 5
THE OFFERING
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Securities Offered (1) . . . . . . . . . . . . . . . . . . . . . . 2,055,477 Shares of Common Stock,
$.01 par value.
Common Stock outstanding prior to Offering (2) . . . . . . . . . . 16,865,669 Shares
Common Stock outstanding after the Offering assuming issuance of
all 628,814 shares underlying the warrants described in footnote (1)
(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,494,483 Shares
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . The securities offered hereby
involve a high degree of risk. See
"Risk Factors" commencing on page
5.
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(1) Includes 1,426,663 shares which are currently outstanding and 628,814
shares which are not outstanding and which are issuable upon exercise of
outstanding warrants.
(2) Does not include shares of Common Stock subject to issuance upon exercise
of outstanding options and warrants and upon conversion of outstanding
convertible notes. See "Risk Factor" number 17.
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RISK FACTORS
THIS OFFERING INVOLVES SUBSTANTIAL INVESTMENT RISK AND SHARES SHOULD BE
PURCHASED ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT.
IN EVALUATING AN INVESTMENT IN THE COMPANY AND ITS BUSINESS, PROSPECTIVE
INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING RISK FACTORS AS WELL AS OTHER
INFORMATION SET FORTH ELSEWHERE IN THIS PROSPECTUS AND INCORPORATED BY
REFERENCE HEREIN.
1. SIGNIFICANT LOSSES. The Company had revenues, excluding discontinued
operations, of $5,241,596, $9,148,925, $10,821,025, $12,210,490 and $16,331,090
for the years ended December 31, 1992, 1993, 1994, 1995 and 1996, respectively,
and incurred net losses of $4,923,602, $12,975,637 and $4,665,654 for the
years ended December 31, 1992, 1993 and 1994, respectively, and net profits of
$76,265 and $779,569 for the years ended December 31, 1995 and 1996,
respectively. There can be no assurance that the Company will achieve
significant revenues or profitable operations in the future.
The Company completed a restructuring in 1994 in which it spun-off a
division, which has been classified as a "discontinued" operation, plus it sold
several other unprofitable product lines, which it has classified as
"terminated" operations, the results of which are included in the above
results. Excluding both "discontinued" and "terminated" operations the
Company's revenues for the fiscal years 1992 through 1996 were approximately
$2,328,000, $3,621,000, $7,782,000, $12,210,490, and $16,331,090, respectively.
2. SIGNIFICANT CASH REQUIREMENTS. The Company's cash requirements have been
and will continue to be significant. The Company's negative cash flow from
operations for the years ended December 31, 1993, 1994, 1995 and 1996 was
$7,341,389, $3,065,334, $1,625,119 and $413,687, respectively. In connection
with the Company's acquisition of Cal ASIC, the Company loaned Cal ASIC
$500,000 at the closing of the transaction and agreed to advance up to an
additional $1,000,000 to Cal ASIC over an eighteen month period to be used by
Cal ASIC for equipment purchases and working capital purposes. To the extent
the Company requires additional financing, there can be no assurance that such
future financings will be available to the Company on acceptable terms.
3. SHARES ELIGIBLE FOR SALE. As of the date of this Prospectus, the
Company had outstanding 16,865,669 shares of Common Stock of which (i)
16,665,669 shares are freely transferable without restriction or further
registration under the Securities Act (including 1,426,663 covered by this
Prospectus) and (ii) 200,000 shares are "restricted securities" within the
meaning of Rule 144 under the Securities Act. Under the recently amended Rule
144, if certain conditions are met, persons who are affiliates of the Company
and persons who satisfy a one year "holding period" may sell within any three
month period a number of shares which does not exceed the greater of one
percent of the total number of shares outstanding or the average weekly trading
volume of such shares during the four calendar weeks prior to such sale. After
a two year holding period is satisfied, persons who are not "affiliates" of the
Company are permitted to sell such shares without regard to these volume
restrictions. "Affiliates" of the Company consist of all officers and
directors of the Company and all holders of ten percent (10%) or more of the
outstanding shares of Common Stock. Of the 16,665,669 shares which are freely
transferable, 1,200,557 are owned by affiliates and are subject to the volume
limitations of Rule 144.
An additional 7,023,793 shares of Common Stock which are not issued and
outstanding but which are issuable upon the exercise of warrants and options
and the conversion of convertible notes are included in currently effective
registration statements (of which 628,814 are covered by this Prospectus) and
upon issuance will be freely transferable during the effectiveness of such
registration statements or are issuable pursuant to warrants and convertible
notes issued pursuant to Regulation S. Of the 7,023,793 shares of Common Stock
issuable upon the exercise of warrants and options and the conversion of
convertible notes, 739,121 are not currently exercisable.
4. RECENT ACQUISITION. During May, 1996, the Company acquired California
ASIC a quick turn, but as yet unprofitable, manufacturer of a special category
of semiconductor chips. The Company believes that Cal ASIC fits well with the
Company's current business activities and believes that the acquisition may
improve the Company's profitability and sales volume at some point in 1997. The
initial expense of
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integrating Cal ASIC into the Company and expanding its sales volume to
profitable levels has produced losses at Cal ASIC and may continue to produce
losses in the near term. Morever, despite plans for additional investment,
there are no guarantees that the operations of Cal ASIC will ever achieve
profitability. JMAR has performed what it believes is extensive due diligence
on the markets, the technologies and the management of Cal ASIC using both its
internal resources as well as several competent, independent outside
consultancy groups. On the basis of the information obtained, the Company is
optimistic regarding the potential future contribution of Cal ASIC to JMAR.
However, there are many possible factors which could negatively impact the
achievement of these expected future benefits, including: failure of the
quick-turn gate array market to materialize as rapidly as forecast, emergence
of new competitors, possible patent infringement claims, inability to attract
and retain the additional qualified employees required to manufacture and sell
the Cal ASIC products and services, failure of the manufacturing facilities to
produce adequate quantities and quality of products within the required time
frame at profitable cost levels, deterioration of the relationship between Cal
ASIC and its base wafer suppliers, litigation from prior creditors or
shareholders of Cal ASIC and the ability of the Company to raise the funds
necessary to adequately finance the working capital needs and equipment
purchase needs of Cal ASIC.
5. GOVERNMENT REGULATION. The Company's JTC subsidiary is subject to
regulation in connection with its government R&D contract work. In addition,
JTC is subject to audit by the U.S. Government (the "Government") of its costs
incurred under Government contracts and to safety audits by various Government
agencies.
6. POSSIBLE FLUCTUATIONS IN OPERATING RESULTS. The Company's operating
results are likely to vary from period to period as a result of the Company's
sales cycle and nonrecurring sales of a limited number of large laser and other
manufacturing systems.
7. LIMITED PRODUCT LINE; UNCERTAINTY OF MARKET ACCEPTANCE AND MARKET
PENETRATION. The markets for certain of the Company's products may be
saturated. There can be no assurance that the Company will achieve greater
penetration in such markets. Achieving market acceptance for the Company's new
and proposed products requires substantial marketing and sales efforts and the
expenditure of significant funds to create customer awareness of and demand for
the Company's products. There can be no assurance that recent or future
additions to the Company's product lines will achieve market acceptance or
result in significantly increased levels of revenues.
8. RESEARCH AND DEVELOPMENT COSTS. The development of sophisticated laser
and microelectronics manufacturing products is a lengthy and capital intensive
process and is subject to unforeseen risks, delays, problems and costs. There
can be no assurance that the Company will be able to successfully develop any
additional products or enhance existing products, or that unanticipated
technical or other problems will not occur which would result in delays in the
Company's development program. Failure to complete development of a product on
a timely basis could result in the complete loss of the funds committed by the
Company to that product, which could be substantial.
9. PRODUCT DEFECTS. Products as complex as the Company's may contain
certain defects which from time to time become apparent subsequent to
commercial use. Remedying such defects could require significant modifications
at substantial costs to the Company.
10. DEPENDENCE ON SUPPLIERS; NO ASSURANCE OF CONTINUOUS AND TIMELY
PRODUCTION. The Company is dependent upon outside suppliers for components
used in the manufacture of its products. Failure to maintain satisfactory
agreements with suppliers could have a material adverse effect on the Company.
There can be no assurance that in the future its current or alternative sources
will be able to meet all of the Company's demands on a timely basis.
Unavailability of parts or components used in the manufacture of its products
could require the Company to re-engineer its products to accommodate available
substitutions, which could increase costs to the Company or have a material
adverse effect on manufacturing schedules, product performance and market
acceptances.
11. COMPETITION; POSSIBLE TECHNOLOGICAL OBSOLESCENCE. The markets for the
Company's products are highly competitive and are characterized by rapid
technological change and evolving industry standards. Development by others of
new or improved products, processes or technologies may make the Company's
products obsolete or less competitive. The ability of the Company to compete is
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dependent on the Company's ability to continually enhance and improve its
products and to successfully develop and market new products. Many of the
Company's competitors have greater financial, managerial and technical
resources than the Company. There can be no assurance that the Company will
successfully differentiate itself from its competitors, that the market will
consider the Company's products to be superior to its competitors' products or
that the Company will be able to adapt to evolving markets and technologies,
develop new products or achieve and maintain technological advantages.
12. PATENTS AND PROPRIETARY RIGHTS. The Company relies, to a significant
extent, on patents, trade secrets and confidentiality agreements to protect its
proprietary technology. There can be no assurance as to the breadth or degree
of protection which existing or future patents, if any, may afford the Company,
or that patents will not be circumvented or invalidated, or that the Company's
products do not and will not infringe on patents or violate proprietary rights
of others. In the event a patent infringement claim is asserted against the
Company, or the Company is required to enforce its rights under an issued
patent, the cost of such actions may be very high, whether or not the Company
is successful. While the Company is unable to predict what such costs, if any,
will be if the Company is obligated to pursue patent litigation, its ability to
fund its operations and to pursue its business goals may be substantially
impaired.
13. RELIANCE ON FOREIGN SALES. The Company derives a portion of its
revenues from foreign markets and expects to continue to be dependent upon such
markets. Revenues from foreign markets were $1,801,440 and $3,405,448 for the
years ended December 31, 1995 and 1996, respectively. As a result, the Company
is subject to various risks inherent in foreign trade, including economic or
political instability, shipping delays, fluctuations in foreign currency rates,
custom duties and import quotas and other trade restrictions, all of which
could have a significant impact on the Company's ability to deliver its
products on a timely and competitive basis.
14. GOVERNMENT BUDGET CONSTRAINTS. Certain of the Company's research and
development activities are partially dependent on Government sponsorship,
particularly by the U.S. Department of Defense ("DOD"). The DOD's overall
budget is undergoing intense scrutiny and is subject to significant reduction
as a result of current world events. This may result in fewer funds available
for the contracts the Company is seeking from the DOD and could adversely
affect the Company's ability to maintain a profitable R&D contract business.
15. PRODUCT LIABILITY. The Company may be exposed to potential product
liability claims arising out of the use of the Company's products. Although
the Company currently maintains product liability insurance, there can be no
assurance that such insurance will be sufficient to cover potential claims or
that the present level of coverage will be available in the future at a
reasonable cost. A partially or completely uninsured successful claim against
the Company could have a material adverse affect on the Company.
16. RELIANCE UPON KEY EMPLOYEES. The success of the Company is
substantially dependent on the efforts of certain key personnel of the Company.
The loss of such key personnel could adversely affect the Company's business
and prospects. In such event, there can be no assurance that the Company would
be able to employ qualified persons on terms favorable to the Company. In
seeking qualified personnel, the Company will be required to compete with
companies having greater financial and other resources than the Company. Since
the future success of the Company is, in part, dependent upon its ability to
retain or attract qualified personnel, the Company's failure to do so could
have a materially adverse impact on the business of the Company.
17. OUTSTANDING RIGHTS TO ACQUIRE COMMON STOCK. As of March 27, 1997,
there were 7,973,523 shares of Common Stock subject to issuance upon exercise
of outstanding options and warrants and upon conversion of outstanding
convertible notes, including 628,814 shares of Common Stock offered hereby and
6,394,979 shares which are included in currently effective registration
statements or are issuable under warrants and convertible notes issued pursuant
to Regulation S. Included in the 7,973,523 shares are 5,314,818 shares which
are either (i) not currently exercisable; (ii) exercisable or convertible at
prices in excess of the market price of the Company's Common Stock on March 27,
1997 ($2.44); or (iii) are not included in currently effective registration
statements or issuable under warrants and convertible notes issued pursuant to
Regulation S such that these shares would not be freely tradeable upon
issuance. Included in the 5,314,818 shares are 4,442,398 shares which are
exercisable or convertible at prices of $3.00 or higher. To the extent that
outstanding options and warrants are
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exercised prior to their expiration dates and other securities are converted,
additional equity investment funds will be paid into the Company at the expense
of dilution to the interests of the Company's stockholders. Moreover, the terms
upon which the Company will be able to obtain additional equity capital may be
adversely affected since the holders of outstanding options and warrants and
other securities can be expected to exercise or convert them at a time when the
Company would, in all likelihood, be able to obtain any needed capital on terms
more favorable to the Company than those provided in such securities.
18. NO DIVIDENDS. The Company has never paid cash dividends and intends,
for the foreseeable future, to retain its earnings, if any, to finance its
business. Future dividend policy will depend on the Company's earnings,
capital requirements, financial condition, debt covenants and other factors
considered relevant by the Company's Board of Directors.
19. UTILIZATION OF NET OPERATING LOSS CARRYFORWARD. Realization of
future tax benefits from utilization of the Company's net operating loss
carryforwards for income tax purposes is limited by changes in ownership in
1990, 1992 and 1993. In addition, the net operating losses of acquired
companies are also subject to separate change of ownership limitations.
20. AUTHORIZATION AND ISSUANCE OF PREFERRED STOCK. The Company's Board of
Directors is authorized to issue up to 5,000,000 shares of Preferred Stock. The
Board of Directors has the power to establish the dividend rates, liquidation
preferences, voting rights, redemption and conversion terms and privileges with
respect to any series of Preferred Stock. The issuance of any shares of
Preferred Stock having rights superior to those of the Common Stock may result
in a decrease in the value or market price of the Common Stock. Holders of
Preferred Stock may have the right to receive dividends, certain preferences in
liquidation and conversion rights. The issuance of Preferred Stock could, under
certain circumstances, have the effect of delaying, deferring or preventing a
change in control of the Company without further vote or action by the
stockholders and may adversely affect the voting and other rights of the
holders of Common Stock.
21. NASDAQ-NMS MAINTENANCE REQUIREMENTS; POSSIBLE DELISTING OF SECURITIES
FROM NASDAQ-NMS SYSTEM. The Board of Governors of the National Association of
Securities Dealers, Inc. has established certain standards for the continued
listing of a security on the NASDAQ National Market System ("NASDAQ-NMS").
Because the Company has had a net profit in the last two years, the current
maintenance standards for continued listing of the Company's Common Stock on
the NASDAQ-NMS require, among other things, that an issuer have net tangible
assets of at least $1 million. As of December 31, 1996, the Company's net
tangible assets were approximately $8,257,015. The NASDAQ has recently proposed
changes to the NASDAQ listing requirements. Among other requirements, the
proposed changes would require that NASDAQ companies have (i) net tangible
assets of at least $4 million; and (ii) a minimum bid price of $1. There can be
no assurance that the Company will satisfy the requirements for maintaining a
NASDAQ-NMS listing in the future under the proposed new rules. If the Company's
securities were excluded from NASDAQ-NMS, it could adversely affect the prices
of such securities and the ability of holders to sell them.
22. MARKET OVERHANG FROM THE WARRANTS; MARKET OVERHANG RESULTING FROM
CERTAIN ANTI-DILUTION PROVISIONS. The exercise of the Company's outstanding
warrants and options, or a substantial portion thereof, and sale of the shares
issued upon exercise could adversely affect the market price of the Common
Stock. In addition, the number of shares issuable upon exercise of the
Underwriters' Warrants issued in the Company's 1993 public offering as well as
the exercise price of the warrants underlying such Underwriters' Warrants, are
subject to adjustment under certain circumstances, including the future
issuance of shares by the Company at a price less than the current exercise
prices of such warrants and options. The issuance of additional shares as a
result of such anti-dilution provisions could also adversely affect the market
price of the Common Stock. Of the Company's outstanding options, warrants and
shares underlying convertible notes, 5,314,818 are either (i) not currently
exercisable; (ii) exercisable or convertible at prices in excess of the market
price of the Company's Common Stock on March 27, 1997 ($2.44); or (iii) not
included in currently effective registration statements or issuable under
warrants and convertible notes issued pursuant to Regulation S such that these
shares would not be freely tradeable upon issuance. Included in the 5,314,818
shares are 4,442,398 shares which are exercisable or convertible at prices of
$3.00 or higher.
8
<PAGE> 10
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of Common Stock by
the Selling Stockholders.
9
<PAGE> 11
SELLING STOCKHOLDERS
The following table sets forth as of March 27, 1997 certain
information regarding the beneficial ownership of the Company's Common Stock by
each of the Selling Shareholders. The footnotes which follow this table contain
additional information regarding the nature of any position, office or other
material relationship which the Selling Shareholders have had within the past
three years with the Company and its affiliates. Except as otherwise noted, the
persons shown in the table have sole voting and investment power with respect
to the shares and are former shareholders of California ASIC, Inc. ("Cal
ASIC").
<TABLE>
<CAPTION>
Number of Percent of
Number of Shares Shares
Shares of Percent of Remaining Outstanding
Common Shares of Number of if All if All
Stock Common Shares Shares Shares
Beneficially Stock Being Registered Registered
Name and Address Owned Outstanding Registered Are Sold Are Sold
- ---------------------------------- ------------ ------------ ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
Nancy D. Schwalbe (1)
13845 Alton Parkway
Irvine, CA 92618 767,478 4.49% 767,478 0 0.00%
Edwin Barrowcliff (2)
13845 Alton Parkway
Irvine, CA 92618 767,478 4.49% 767,478 0 0.00%
Sumner Saul and Fiby Saul (3)
Trustee for Sumner and
Fiby Saul Trust
1112 Maybrook Drive
Beverly Hills, CA 90210 323,588 1.89% 22,288 301,300 1.76%
Marvin and Leisa Sepe (4)
24701 Woodhill Street
Lake Forest, CA 92630 146,269 * 146,269 0 0.00%
The Dang Family Trust
2521 South King Road
San Jose, CA 95122 50,928 * 50,928 0 0.00%
H.S. Hwang (5)
806 Terra Bella Drive
Milipitas, CA 95035 47,300 * 47,300 0 0.00%
Robert C. Genesi (5)
5212 62nd Avenue South
St. Petersburg, FL 33715-2403 44,000 * 44,000 0 0.00%
John M. Embry and
Mary Schaefer JTWROS (6)
3940 Marine Avenue
Lawndale, CA 90260 33,431 * 33,431 0 0.00%
Maria Fong and
Christopher Fong JTTEN
459 Geary Street
San Francisco, CA 94102 30,250 * 30,250 0 0.00%
Mona DuVernet
1334 Parkview, Suite #245
Manhattan Beach, CA 90266 26,841 * 26,841 0 0.00%
Herbert Chestler
107 Station Road
Great Neck, NY 11023-1720 19,250 * 19,250 0 0.00%
- -------
</TABLE>
* Less than one percent.
10
<PAGE> 12
<TABLE>
<CAPTION>
Number of Percent of
Number of Shares Shares
Shares of Percent of Remaining Outstanding
Common Shares of Number of if All if All
Stock Common Shares Shares Shares
Beneficially Stock Being Registered Registered
Name and Address Owned Outstanding Registered Are Sold Are Sold
- ---------------------------------- ---------- ------------ ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
Thang Tran Dang, Thanh Thanh Dang
and Minh Trang Dang, Joint
Tenants
with right of Survivorship
2521 South King Road 15,279 * 15,279 0 0.00%
San Jose, CA 95122
Daniel Oliver
496 Hillcrest Drive
Leucadia, CA 92024 13,752 * 13,752 0 0.00%
Ernst Uhlmann
Am Sonnenberg 6
CH-9507
Stettfurt, Switzerland 13,752 * 13,752 0 0.00%
Parkway Financial
15375 Barranca Parkway,
Ste. E-102 13,070 * 13,070 0 0.00%
Irvine, CA 92718
Phillip Schwalbe
5603 Seashore
Newport Beach, CA 92712 12,100 * 12,100 0 0.00%
Maria Fong and
Abraham Fong JTTEN
459 Geary Street
San Francisco, CA 94102 11,001 * 11,001 0 0.00%
Bok Joo Woo
806 Terra Bella Drive
Milipitas, CA 95035 5,501 * 5,501 0 0.00%
Jeffrey M. Gange
205 A 39th Street
Newport Beach, CA 92663 2,751 * 2,751 0 0.00%
Ray L. Hazelwood and
Amy Hazelwood JTTEN (7)
2391 Steven Drive
Corona, CA 91719 2,200 * 2,200 0 0.00%
Gary Baldridge
25231 Paseo de Alicia, Ste. 105
Laguna Hills, CA 92653 1,541 * 1,541 0 0.00%
Brian Harkins
615 North Sepulveda Place
Placentia, CA 92670 1,101 * 1,101 0 0.00%
Eugene Fitzgibbons
7 Via Adelia
San Clemente, CA 92672 1,101 * 1,101 0 0.00%
Khanh Tran
119 Night Heron Lane
Aliso Viejo, CA 92656 1,101 * 1,101 0 0.00%V
</TABLE>
______
* Less than one percent.
11
<PAGE> 13
<TABLE>
<CAPTION>
Number of Percent of
Number of Shares Shares
Shares of Percent of Remaining Outstanding
Common Shares of Number of if All if All
Stock Common Shares Shares Shares
Beneficially Stock Being Registered Registered
Name and Address Owned Outstanding Registered Are Sold Are Sold
- ---------------------------------- ---------- ------------ ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
John Miele and Lillian Miele
JTWROS
55-09 Seabury Street 825 * 825 0 0.00%
Flushing, NY 11373-4425
Doris J. Shoner and
Marshall Shoner JTTEN
12244 Truro Avenue
Hawthorne, CA 90250 825 * 825 0 0.00%
Benjamin Winter
c/o Paine Webber, Inc.
1000 Harbor Blvd.
Weehawken, NJ 07087 660 * 660 0 0.00%
Vicki Carlson-Velasco
2813 East Diana Avenue
Anaheim, CA 92806 551 * 551 0 0.00%
Ron Abbate
205A 39th Street
Newport Beach, CA 95035 551 * 551 0 0.00%
Robert Rupert
3762 Colin Court
Decatur, IL 62526 386 * 386 0 0.00%
Kathryn Atkins
1901 Bryan Avenue
Tustin, CA 92680 330 * 330 0 0.00%
Melvin E. Karlin
Bertha Karlin TTEESFBO
Karlin Family Trust
DTD 02/10/92
28302 Alava
Mission Viejo, CA 92692 330 * 330 0 0.00%
James Greer
1513 River Lane
Santa Ana, CA 92706 275 * 275 0 0.00%
David L. Rupert
445 Kelly Court
Decatur, IL 62521 221 * 221 0 0.00%
Jerry Tortoro
715 South Chantilly Street
Anaheim, CA 92806 221 * 221 0 0.00%
Frederick Hancock
c/o Philadep & Co.
1900 Market Street
Philadelphia, PA 19103-3595 165 * 165 0 0.00%
Dennis Hale, Jr.
7709 South Broadway
Los Angeles, CA 90003 132 * 132 0 0.00%
- ------
</TABLE>
* Less than one percent.
12
<PAGE> 14
<TABLE>
<CAPTION>
Number of Percent of
Number of Shares Shares
Shares of Percent of Remaining Outstanding
Common Shares of Number of if All if All
Stock Common Shares Shares Shares
Beneficially Stock Being Registered Registered
Name and Address Owned Outstanding Registered Are Sold Are Sold
- ---------------------------------- ----------- ------------ ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
Dennis Hale, Jr. Cust. for
Dennis Erwin Hale UCAUTMA
7709 South Broadway
Los Angeles, CA 90003 132 * 132 0 0.00%
Carl Tortoro
715 South Chantilly Street
Anaheim, CA 92806 89 * 89 0 0.00%
Helen Barolini
86 Maple Avenue
Hastings on Hudson, NY 10706 12 * 12 0 0.00%
Kingdom Renewal & Empowerment,
Inc.
5260 Duelling Oaks 9 * 9 0 0.00%
Memphis, TN 38116
</TABLE>
(1) Includes 242,373 shares which are issuable upon exercise of currently
exercisable warrants at an exercise price of $2.01 per share. Ms.
Schwalbe is the Chief Operating Officer, Executive Vice President and
Vice Chairman of the Board of Cal ASIC. The 525,105 shares which are
outstanding are included in an escrow which limits the sale of such
shares by the terms of the escrow and the 242,373 shares issuable upon
exercise of the warrants are required to be deposited into the escrow
upon issuance. The term of the escrow ends on December 31, 1998.
(2) Includes 242,373 shares which are issuable upon exercise of currently
exercisable warrants at an exercise price of $2.01 per share. Mr.
Barrowcliff is the President, Chief Executive Officer and a director
of Cal ASIC. The 525,105 shares which are outstanding are included in
an escrow which limits the sale of such shares by the terms of the
escrow and the 242,373 shares issuable upon exercise of the warrants
are required to be deposited into the escrow upon issuance. The term
of the escrow ends on December 31, 1998.
(3) Includes (i) 225,000 shares which are issuable upon exercise of
currently exercisable warrants at exercise prices ranging from $1.50 to
$2.50 held by Mogador Partnership, of which Fiby Saul is a partner;
(ii) 2,900 shares held in a Keogh plan for the benefit of Sumner Saul;
(iii) 43,400 shares held in an Individual Retirement Account ("IRA")
for the benefit of Sumner Saul; and (iv) 10,000 shares held in an IRA
for the benefit of Fiby Saul.
(4) Includes 144,068 shares which are issuable upon exercise of currently
exercisable warrants at an exercise price of $2.01 per share. Mr.
Sepe is the General Manager and Executive Vice President of Cal ASIC
and a director of the Company. Ms. Sepe is an employee of Cal ASIC.
(5) Holder is a former director of Cal ASIC.
(6) Holder received the shares as a finder's fee in connection with the
acquisition of Cal ASIC shares by the Company.
(7) Ms. Hazelwood is an employee of Cal ASIC.
______
* Less than one percent.
13
<PAGE> 15
PLAN OF DISTRIBUTION
Following the date of this Prospectus, the Selling Shareholders will
be able to sell shares covered hereunder from time to time in one or more
transactions in the over-the-counter market at prices and on terms prevailing
on the date of the sale or in negotiated transactions or otherwise. Of the
2,055,477 shares registered hereunder 1,534,956 are subject to an escrow and
are restricted from being sold pursuant to the terms of the escrow until
January 1, 1999. The remaining shares covered hereby may be sold by the Selling
Shareholders from and after the date of this Prospectus, and the Company has
not been advised when, or even whether, the Selling Shareholders intend to sell
such shares.
The Selling Shareholders may pay customary brokerage commissions on
the sale transactions. The Selling Shareholders and the brokers and dealers
through whom sales of the shares are made may be deemed "underwriters" within
the meaning of the Act and any and all payments to brokers/dealers associated
with a distribution may be considered to be underwriting compensation.
Pursuant to various agreements with a substantial number of Selling
Shareholders, the Company has agreed to indemnify such Selling Shareholders
against certain liabilities, including those arising under the Securities Act
of 1933. If the Selling Shareholders should, collectively, engage a broker or
dealer to sell a material portion of the Common Stock offered hereby, the
Company may be required to file a post-effective amendment to this Registration
Statement to show a change in the plan of distribution. The shares of Common
Stock will be offered on a delayed or continuous basis pursuant to Rule 415
under the Act.
EXPERTS
The consolidated financial statements and schedules of the Company
dated December 31, 1996 and 1995 and for the three years ended December 31,
1996 and the financial statements of California ASIC, Inc. as of December 31,
1995 and 1994 and for the years then ended incorporated by reference in this
Prospectus and elsewhere in the registration statement have been audited by
Arthur Andersen LLP, independent public accountants, to the extent and for the
periods indicated in their reports with respect thereto, and are incorporated
by reference herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said reports.
The financial statements of California ASIC, Inc. as of December 31,
1993 and for the year then ended incorporated by reference in this Prospectus
and elsewhere in the registration statement have been audited by Corbin &
Wertz, independent public accountants, to the extent and for the period
indicated in their report with respect thereto, and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said report.
LEGAL MATTERS
The legality of the Securities offered hereby is being passed upon for
the Company by Parker, Milliken, Clark, O'Hara & Samuelian, Professional
Corporation, Los Angeles, California.
ADDITIONAL INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") in Washington, D.C., a Registration Statement on Form S-3 under
the Securities Act of 1933 with respect to the securities offered hereby.
This Prospectus, filed as a part of the Registration Statement, does
not contain all of the information set forth in the Registration Statement,
certain portions of which have been omitted as permitted by the rules and
regulations of the Commission. For further information pertaining to the shares
of Common Stock offered hereby and to the Company, reference is made to the
Registration
14
<PAGE> 16
Statement, including the exhibits filed as a part thereof and the documents
containing the information which is incorporated by reference herein. Copies of
the Registration Statement and the exhibits thereto may be obtained as set
forth on page 2 of this Prospectus.
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, 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 offer or solicitation to any person in any jurisdiction where
such offer or solicitation would be unlawful. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any securities
other than the registered securities to which it relates. Neither delivery of
this Prospectus nor any sales hereunder shall, under any circumstances, create
an implication that there has been no change in the facts herein set forth
since the date hereof.
15
<PAGE> 17
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is an itemized statement of expenses of the Company in
connection with the issuance and sale of the securities being registered:
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee . . . . . . . . . . . . $1,501
Printing expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . . . . . . . 5,000
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Miscellaneous expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 1,499
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $14,000
</TABLE>
The amounts are estimated except for the registration fee. The
Company has agreed to pay the above expenses of the Selling Stockholders in
connection with the Offering.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article V of the Bylaws of the Company provides that directors,
officers, employees and agents of the Company or a subsidiary of the Company
shall be indemnified against liabilities incurred by them while acting in such
capacities, including liabilities arising under the Securities Act, except to
the extent prohibited by then applicable law. Article V also provides for the
advance of expenses incurred in defending any proceeding prior to the final
disposition thereof, except to the extent prohibited by then applicable law.
The right of indemnification provided shall not be exclusive of any right the
party may have by law, or under any agreement, insurance policy, vote of the
Board of Directors or Stockholders or otherwise. The Company shall have the
power to purchase and maintain insurance on behalf of any indemnifiable party
against any liability asserted against or incurred by the indemnifiable party
in such capacity.
Section 145 of the Delaware General Corporation Law generally provides
that indemnification will only be available where an officer or director can
establish that he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Company.
The Company maintains a director's and officer's liability insurance
policy which indemnifies directors and officers for certain losses arising from
a claim by reason of a wrongful act, as defined, under certain circumstances,
in his capacity as a director or officer of the Company or any of its
subsidiaries.
See the last paragraph of Item 17, "Undertakings" which is
incorporated by reference in response to this Item 15.
II-1
<PAGE> 18
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- --------- ----------------------------------------------------------------------
<S> <C>
4.1(1) Form of Common Stock Certificate.
5.1 Opinion of Parker, Milliken, Clark, O'Hara & Samuelian, Professional Corporation.
23.1 Consent of Parker, Milliken, Clark, O'Hara & Samuelian, Professional Corporation is included in Exhibit 5.1 hereto.
23.2 Consent of Arthur Andersen LLP.
23.3 Consent of Corbin & Wertz.
24.1 Power of Attorney (see signature page in Part II of this Registration Statement).
</TABLE>
______________________________________
(1) Incorporated by reference to the exhibit filed with the Company's
Registration Statement on Form S-1 (No. 33-47390) filed on April 22,
1992 and amended November 23, 1992, January 11, 1993, January 27,
1993, February 9, 1993, February 11, 1993, February 12, 1993 and
declared effective on February 16, 1993.
II-2
<PAGE> 19
ITEM 17. UNDERTAKINGS
The undersigned Company hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement; and
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the registration statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
The undersigned Company hereby undertakes that for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification of liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the Company
of expenses incurred or paid by a director, officer or controlling person of
the Company in the successful defense of any action, suit or proceeding) if
asserted by such director, officer or controlling person in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
II-3
<PAGE> 20
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant 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 San Diego, State of California, on the 28th day
of March, 1997.
JMAR INDUSTRIES, INC.
By: /s/ Dennis E. Valentine
-----------------------------------
Dennis E. Valentine,
Chief Financial Officer
POWER OF ATTORNEY
We, the undersigned directors of JMAR Industries, Inc. and each of us, do
hereby constitute and appoint John S. Martinez and Dennis E. Valentine, or any
one of them, our true and lawful attorneys and agents, each with power of
substitution, to do any and all acts and things in our names and on our behalf
in our capacities as directors and to execute any and all instruments for us
and in our names in the capacities indicated above, which said attorneys and
agents, or any one of them may deem necessary or advisable to enable said
corporation to comply with the Securities Act of 1933, as amended, and any
rules, regulations and requirements of the Securities and Exchange Commission,
in connection with this Registration Statement, including specifically, but
without limitation, power and authority to sign for us or any of us in our
names in the capacities indicated below, any and all amendments (including
post-effective amendments) hereto; and we do hereby ratify and confirm all that
the said attorneys and agents, or their substitute or substitutes, or any one
of them, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons on March 28, 1997, in
the capacities indicated.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ JOHN S. MARTINEZ Chairman of the Board,
- -----------------------------------
John S. Martinez Chief Executive Officer and Director
/s/ DENNIS E. VALENTINE Chief Financial Officer and Principal
- -----------------------------------
Dennis E. Valentine Accounting Officer
/s/ BARRY RESSLER Director
- -----------------------------------
Barry Ressler
/s/ C. NEIL BEER Director
- -----------------------------------
C. Neil Beer
/s/ JAMES H. BANISTER, JR. Director
- -----------------------------------
James H. Banister, Jr.
/s/ VERNON H. BLACKMAN Director
- -----------------------------------
Vernon H. Blackman
/s/ MARVIN W. SEPE Director
- -----------------------------------
Marvin W. Sepe
</TABLE>
II-4
<PAGE> 1
EXHIBIT 5.1
March 27, 1997
JMAR Industries, Inc.
3956 Sorrento Valley Boulevard
Suite D
San Diego, California 92121
Gentlemen:
We are acting as your counsel in connection with the
registration by you under the Securities Act of 1933 (the "1933 Act") of (i)
1,426,663 shares of Common Stock of JMAR Industries, Inc. (the "Company") which
are currently issued and outstanding, and (ii) 628,814 shares of Common Stock
authorized for issuance upon the exercise of warrants, all of which shares are
to be sold by certain selling shareholders (the "Selling Shareholders'
Shares"). We are familiar with the Form S-3 Registration Statement which you
have filed with the Securities and Exchange Commission to register such
securities under the 1933 Act.
In rendering this opinion, we have examined and relied upon,
among other things, originals or copies, identified to our satisfaction as
being true copies, of the following: Certificate of Incorporation of the
Company, as amended to date; Bylaws of the Company, as amended to date; and
corporate records and other instruments and documents as were deemed necessary
or appropriate for purposes of this opinion. As to questions of fact material
to this opinion, we have, when the relevant facts were not independently
established by us, relied upon the documents we have examined or upon
certificates of officers of the Company. In our examination of the documents
referred to above, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity
with the originals of all documents submitted to us as copies.
We have investigated such questions of law for the purpose of
rendering this opinion as we have deemed necessary. We are attorneys duly
admitted and qualified to practice in the State of California and we express no
opinion as to the laws of any other jurisdiction except United States federal
law.
<PAGE> 2
JMAR Industries, Inc.
March 27, 1997
Page 2
Based on the foregoing, and in reliance thereon, we are of the
opinion that (i) all of the Selling Shareholders' Shares have been duly
authorized, (ii) that the shares of Common Stock issuable upon exercise of the
warrants have been validly reserved for issuance upon exercise thereof, (iii)
the shares of the Common Stock which are outstanding and part of the Selling
Shareholders' Shares are validly issued, fully paid and nonassessable and (iv)
upon receipt by the Company of full payment of the exercise price for said
warrants and delivery of certificates representing the shares issuable upon
said exercise, the shares issuable upon said exercise will be validly issued,
fully paid and nonassessable.
We consent to the use of this opinion as an Exhibit to the
said S-3 Registration Statement and to the reference to our firm under the
heading "Legal Matters" in the Prospectus which forms a part thereof.
Very truly yours,
/s/ PARKER, MILLIKEN, CLARK, O'HARA
& SAMUELIAN, P.C.
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement on Form S-3 of our
report dated February 24, 1997 on our audits of the financial statements of JMAR
Industries, Inc. included in Form 10-K for year ended December 31, 1996 and our
report dated May 23, 1996 on our audit of the financial statements of California
ASIC Technical Services included in Form 8-K/A filed August 6, 1996 and, all
references to our firm included in or made a part of this registration
statement.
/s/ ARTHUR ANDERSEN LLP
ARTHUR ANDERSEN LLP
San Diego, California
March 28, 1997
<PAGE> 1
EXHIBIT 23.3
CORBIN & WERTZ
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
Board of Directors
California ASIC Technical Services, Inc.
We consent to the incorporation by reference in the Registration Statement on
Form S-3 of JMAR Industries, Inc., expected to be filed March 31, 1997 of our
report dated February 25, 1994, except as to Note 11, which is as of March 5,
1994, related to the 1993 financial statements of California ASIC Technical
Services, Inc., included in Amendment No. 1 to Form 8-K/A of JMAR Industries,
Inc., dated August 2, 1996 and the reference to our firm under the heading
"Experts" included in the Prospectus.
/s/ CORBIN & WERTZ
---------------------------------
CORBIN & WERTZ
Irvine, California
March 28, 1997
