As filed with the Securities and Exchange Commission on June 11, 1996
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EVEREST MEDICAL CORPORATION
(Exact name of registrant as specified in its charter)
Minnesota 41-1454928
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
13755 First Avenue North, Suite 500
Minneapolis, Minnesota 55441
(612) 473-6262
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
JOHN L. SHANNON, JR.
President and Chief Executive Officer
Everest Medical Corporation
13755 First Avenue North, Suite 500
Minneapolis, Minnesota 55441
(612) 473-6262
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
ELIZABETH M. REISKYTL, ESQ.
Fredrikson & Byron, P.A.
1100 International Centre
900 Second Avenue South
Minneapolis, Minnesota 55402
(612) 347-7176
Approximate date of commencement of proposed sale to the public: From time to
time after the effective date of this Registration Statement as determined by
market conditions and other factors.
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 offered 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, please check the following box. [x]
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Amount Offering Aggregate Amount of
Title of Each Class of to be Price Per Offering Registration
Securities to be Registered Registered Unit Price Fee
<S> <C> <C> <C> <C>
Common Stock to be issued
upon conversion of Series 1,066,937 $2.50(1) $2,667,342.50 $919.77
A Preferred Stock Shares
Common Stock to be issued
upon conversion of Series 679,773 2.75(1) 1,869,375.75 644.61
B Preferred Stock Shares
Common Stock to be issued
upon conversion of Series 316,361 2.75(1) 869,992.75 300.00
C Preferred Stock Shares
Common Stock to be issued
upon conversion of Series 300,000 2.875(1) 862,500.00 297.41
D Preferred Stock Shares
Common Stock to be issued
upon conversion of 250,000 2.50(1) 500,000.00 172.41
Convertible Note Shares
Common Stock to be offered 19,077 4.875(2) 93,000.38 32.07
by Selling Shareholder Shares
Common Stock to be issued
upon exercise of 48,435 2.50(1) 121,087.50 41.75
outstanding warrants Shares
Common Stock to be issued
upon exercise of 1,499,888 $2.75(1) $4,124,692.00 $1,422.31
--------- ------------- ---------
outstanding warrants Shares
TOTAL 4,180,471 $11,107,990.88 $3,830.33
- ----- ========= ============= ========
Shares
</TABLE>
(1) For purposes of calculating the registration fee pursuant to Rule
457(f) under the Securities Act of 1933, such amount is based upon the
book value of the securities to be received by the Company.
(2) For purposes of calculating the registration fee pursuant to Rule
457(b) under the Securities Act of 1933, such amount is based upon the
average of the closing bid and asked prices of registrant's Common
Stock on June 5, 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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PROSPECTUS
Everest Medical Corporation
4,180,471 Shares of Common Stock
This Prospectus relates to the offer and issuance or sale of up to
4,180,471 shares of Common Stock (the "Shares"), no par value, of Everest
Medical Corporation, a Minnesota corporation (the "Company"). Except for the
19,077 shares offering by a selling shareholder, all of such shares are issuable
by the Company (i) upon conversion of certain outstanding shares of Preferred
Stock; (ii) upon exercise of outstanding warrants; or (iii) upon conversion of
an outstanding convertible note. The Company will receive proceeds only from
those shareholders exercising warrants, and not upon conversion of any
outstanding shares of Series A, B, C or D Convertible Preferred Stock or the
convertible note.
Of the 4,161,394 Shares offered by the Company, (i) up to 1,066,937
shares are to be issued upon conversion of the same number of outstanding shares
of Series A Convertible Preferred Stock with a conversion price of $2.50 per
share; (ii) up to 679,773 shares are to be issued upon conversion of the same
number of outstanding shares of Series B Convertible Preferred Stock with a
conversion price of $2.75 per share; (iii) up to 316,361 shares are to be issued
upon conversion of the same number of outstanding shares of Series C Convertible
Preferred Stock with a conversion price of $2.75 per share; (iv) up to 300,000
shares are to be issued upon conversion of the same number of outstanding shares
of Series D Convertible Preferred Stock with a conversion price of $2.75 per
share; (v) up to 250,000 shares are to be issued upon conversion of an
outstanding $500,000 Convertible Note, with a conversion price of $2.50 per
share; and (vi) up to 1,548,323 shares are issuable upon exercise of outstanding
warrants, with 1,499,888 having an exercise price of $2.75 per share and 48,435
warrants having an exercise price of $2.50 per share (the "Warrants").
The remaining 19,077 Shares may be offered for sale by St. Paul Fire &
Marine Insurance Company (the "Selling Shareholder" or "St. Paul"). The Selling
Shareholder may offer its Shares from time to time through or to brokers or
dealers in the over-the-counter market at market prices prevailing at the time
of sale or in one or more negotiated transactions at prices acceptable to the
Selling Shareholder. (See "Plan of Distribution"). The Company will not receive
any proceeds from sales of Shares by the Selling Shareholder.
The Company will bear all expenses of the offering (estimated to be
$10,330), except that Selling Shareholder will pay any applicable underwriter's
commissions and expenses, brokerage fees or transfer taxes, as well as any fees
and disbursements of counsel and experts for the Selling Shareholder. The
Company and the Selling Shareholder have agreed to indemnify each other against
certain liabilities, including liabilities arising under the Securities Act of
1933 (the "Securities Act").
The Company's Common Stock is traded on the NASDAQ System under the
symbol "EVMD." The average of the closing bid and asked prices of the Company's
Common Stock on June 10, 1996, as reported by NASDAQ, was $4.94 per share.
FOR INFORMATION CONCERNING CERTAIN RISKS RELATING
TO THIS OFFERING SEE "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 date of this Prospectus is June ___, 1996.
<PAGE>
No person is authorized to give any information or to make any
representations, other than those contained or incorporated by reference in this
Prospectus, in connection with the offering contemplated hereby, 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 to
sell or a solicitation of an offer to buy any securities other than the
registered securities to which it relates. This Prospectus does not constitute
an offer to sell or a solicitation of an offer to buy any securities in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that there has been no change in the affairs of the Company since the date
hereof or that the information contained or incorporated by reference herein is
correct as of any time subsequent to its date.
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 reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C., 20549, and at the Commission's regional offices in New York (7
World Trade Center, New York, New York 10048) and Chicago (Northwestern Atrium
Center, 500 West Madison, Suite 1400, Chicago, Illinois 60661). Copies of such
material can be obtained from the Public Reference Section of the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates.
The Company has filed with the Commission a Registration Statement on
Form S-3 under the Securities Act of 1933 with respect to the securities offered
hereby. For further information with respect to the Company and such securities,
reference is made to such Registration Statement and to the exhibits thereto.
Any statement contained or incorporated by reference herein concerning the
provisions of any document is qualified in its entirety by reference to the copy
of such document filed as an exhibit to the Registration Statement or otherwise
filed with the Commission.
2
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission
pursuant to the Exchange Act, are hereby incorporated by reference in this
Prospectus and shall be deemed to be a part hereof:
1. The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1995.
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996.
3. The description of the Company's Common Stock, no par value,
which is incorporated by reference in the Company's Registration
Statement on Form S-18, File No. 33- 37352-C, filed under the
Securities Act, including any amendment or report filed for the
purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the Shares shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents.
The Company will provide without charge to each person, including any
beneficial owner 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
incorporated herein by reference (not including the exhibits to such documents,
unless such exhibits are specifically incorporated by reference in such
documents). Requests for such copies should be directed to Thomas F. Murphy,
Chief Financial Officer, Everest Medical Corporation, 13755 First Avenue North,
Suite 500, Minneapolis, MN 55441, telephone (612) 473-6262.
3
<PAGE>
THE COMPANY
Everest Medical Corporation, a Minnesota corporation, (the "Company")
is the issuer of the Shares offered hereby. The Company's principal executive
offices are located at 13755 First Avenue North, Suite 500, Minneapolis, MN
55441, and its telephone number is (612) 473-6262. The Company is engaged
primarily in the development, manufacturing and marketing of bipolar
electrosurgical devices for use in minimally invasive surgical procedures.
Minimally invasive procedures have a growing range of surgical applications in
such areas as gynecology, gastroenterology and general surgery.
The Company commenced commercial sales of laparoscopic surgical
products in September 1992. The first product sold was the BiCOAG(R) Bipolar
Forceps. The Company added the EVERSHEARS(R) Straight Bipolar Scissors in
November 1992 and the EVERSHEARS Curved Bipolar Scissors in September 1993. The
Company introduced three additional products to the laparoscopic market in 1994,
including the EVERSHEARS II Bipolar Metal-on-Metal Curved Scissors, the BiCOAG
Bipolar Dissecting Forceps and the BiLAP(R) Bipolar Needle Electrode. In 1995,
the Company commenced sales of the innovative, patented, multi-functional BiCOAG
Cutting Forceps. The Company is targeting these existing and new products to the
laparoscopic general surgery and gynecology markets. As minimally invasive
surgical techniques have evolved to increasingly complex surgery in anatomically
crowded areas of the human body, the need for safer instrumentation has become
more evident. The Company believes that bipolar electrosurgery is gaining
increasing scientific recognition and acceptance in the growing minimally
invasive surgery ("MIS") markets which predominately utilize monopolar energy.
Bipolar energy offers the surgeon more control, less tissue damage, effective
hemostasis and performance, eliminating the dangers associated with monopolar
energy. The Company believes that bipolar technology will become the standard in
electrosurgery in all MIS procedures and the Company will be a beneficiary of
this trend.
The Company continues to market a line of disposable products for use
in selected gastrointestinal endoscopic interventional procedures. These
procedures are performed by gastroenterologists using endoscopes through which
Everest's products are inserted into the body. These products are the BiSNARE(R)
Polypectomy Snare for removing colon polyps and the BiCOAG Probe(R)
Gastrointestinal Coagulator for treating intestinal bleeding.
The electrosurgical products currently under development or being
marketed by Everest operate in a bipolar mode providing an improved margin of
patient safety in minimally invasive surgical procedures. Many of these
procedures are typically performed using monopolar electrosurgery which has
inherent characteristics that may pose certain risks for patients. In
electrosurgery, radio frequency, or RF energy is used both to cut and coagulate
tissue. With monopolar devices, the RF energy must pass from the surgical
instrument through the patient's body to a separate return electrode attached to
a large surface area, generally the buttocks or thigh. With monopolar
electrosurgery, there is a greater potential for injury to body tissues as the
electrical current passes through to the surface or return electrode (grounding
pad) where skin burns can also occur. With bipolar devices, the RF energy is
contained at the surgical site because both the active and return electrodes are
located on the surgical instrument. In minimally invasive surgery, there is even
greater potential for complications when using monopolar instruments due to the
combined effects of the surgeon's limited field of vision, the proximity of
other organs and the inherent tendency of the surgical instruments to conduct
monopolar RF energy.
The Company has developed extensive expertise in the control and
containment of bipolar radio frequency energy to affect both surgical cutting
and coagulation of blood in a variety of surgical and interventional procedures.
The Company's strategy is to leverage its expertise to design, develop and
manufacture proprietary surgical instruments for use in selected minimally
invasive surgical procedures where the safety and other features of bipolar
electrosurgery have demonstrable advantages.
4
<PAGE>
RISK FACTORS
Prospective investors should carefully consider the following risk
factors.
1. Absence of Profitable Operating History and Continuing Losses. The
Company has incurred cumulative losses of $18,848,281 from inception through
March 31, 1996 and it is likely that it will incur additional losses in 1996.
Although the Company expects to approach profitability by the end of 1996, there
can be no assurance that the Company's current or future products can ever be
sold in sufficient quantities and at profit margins necessary to achieve and
maintain profitable operations.
2. Need for Additional Capital. Management currently anticipates that
the Company will have sufficient cash to meet its working capital needs through
1996. However, any inability of the Company to increase sales of current
products as anticipated, or any delays in achieving market acceptance of the
Company's new products, increases in research and development expenses due to
unanticipated difficulties in completing development of products currently in
development, decisions to begin or accelerate development of additional
products, or inability to market its line of bipolar instruments could cause the
Company to require additional capital earlier than now projected. In addition,
the Company now faces significant dividend obligations relating to the
outstanding Series B and Series C Convertible Preferred Shares, and will begin
to pay dividends on the Series D Preferred Shares in September 1996. Even if the
Company is able to meet or exceed its sales objectives, the Company may require
additional capital to finance growth in inventories and receivables. No
assurance can be given that the Company will be able to obtain required
additional funding on satisfactory terms, if at all.
3. Competition. There are only a limited number of competitive bipolar
instruments currently on the market. However, the Company's current and future
products will in most cases compete not only with competitive bipolar devices,
but also with devices based on monopolar, laser and other technologies.
Companies which currently manufacture electrosurgical and other competitive
products can be expected to engage in continuing research and development which
will result in new products, some of which will be bipolar, that will be
competitive with the Company's products. The Company is aware of several U.S.
and European companies which have developed or are developing bipolar
laparoscopic devices, one of which is designed for cutting and several of which
are designed for coagulation. Circon Corporation, for example, has a cutting and
coagulation forceps, though such product is not yet patented. At the present
time, the Company is unable to predict the impact that these products may have
on foreign or domestic sales of the Company's products. The Company's known and
potential competitors are well-established and have substantially more
experience and financial resources than the Company. The Company's ability to
compete will depend upon a number of factors, including its ability to
manufacture, market and distribute its bipolar electrosurgical devices at
commercially acceptable prices, to supply product under its remaining OEM
contracts, its success in generating market acceptance for the products and the
establishment of an effective marketing organization.
4. Bipolar Scissors Patent Developments. On October 4, 1994, the
Company received a patent from the United States Patent Office on the
EVERSHEARS(TM) II bipolar scissors, a metal-on- metal design. The Company is
aware that the Patent Office has issued two patents to another party involving
ceramic bipolar scissors technology. The Company no longer manufactures and
distributes ceramic bipolar scissors, and based on advice of counsel, the
Company does not believe that the EVERSHEARS II bipolar scissors infringes the
two patents held by such third party. There is no assurance, however, that the
owner of the two patents will not bring an action against the Company for
infringement.
5. Single Sources of Supply. The Company currently purchases, and will
in the future purchase, parts and components from vendors. While the Company
attempts to have more than a single source of supply for each part and
component, it is possible from time to time that the Company will have only one
supplier for any single part or component. Should a supplier be unwilling or
unable to supply any such part or component in a timely manner, the Company's
business could be materially adversely affected.
5
<PAGE>
USE OF PROCEEDS
The net proceeds to the Company from the exercise of the Warrants will
be $4,245,779.50 if all Warrants are exercised. The Company will receive no
additional proceeds from the conversion of Preferred Shares or the convertible
note. There can be no assurance that any of the Warrants will be exercised or
that any of the Series A, Series B, Series C or Series D Convertible Preferred
Shares or the convertible note will be converted. The Company intends to use all
of the proceeds for working capital purposes.
SELLING SHAREHOLDER
Set forth below is the name of the Selling Shareholder, its
relationships to the Company, the number of shares of Common Stock of the
Company beneficially owned by it as of June 10, 1996, the number of shares
offered hereby and the percentage of the outstanding Common Stock to be owned if
all the shares registered hereunder are sold by the Selling Shareholder.
Number of Shares Number of Shares Percentage of
Name Beneficially Owned Offered Hereby Shares Owned
After
St. Paul Fire and Marine
Insurance Co. 98,173(1) 19,077 1.7%
- ------------------------------
(1) Includes 57,168 shares of Common Stock issuable upon exercise of currently
exercisable warrants.
6
<PAGE>
PLAN OF DISTRIBUTION
The Shares offered by the Company hereby will be issued (i) upon
conversion of up to 1,066,937 outstanding shares of Series A Convertible
Preferred Stock; (ii) upon conversion of up to 679,773 outstanding shares of
Series B Convertible Preferred Stock; (iii) upon conversion of up to 316,361
outstanding shares of Series C Convertible Preferred Stock; (iv) upon conversion
of up to 300,000 outstanding shares of Series D Convertible Preferred Stock; (v)
upon conversion of an outstanding $500,000 Convertible Note, with a conversion
price of $2.50 per share; and (vi) upon exercise of the Warrants to purchase up
to 1,548,323 shares of Common Stock.
The Selling Shareholder has advised the Company that all or a portion
of the 19,077 Shares offered by the Selling Shareholder hereby may be sold from
time to time by the Selling Shareholder or by pledges, donees, transferees or
other successors in interest. Such sales may be made in the over-the-counter
market or otherwise at prices and at terms then prevailing or at prices related
to the then current market price, or in negotiated transactions. The Shares may
be sold by one or more of the following means: (a) ordinary brokerage or market
making transactions and transactions in which the broker or dealer solicits
purchasers; (b) block trades in which the broker or dealer so engaged will
attempt to sell the Shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction; and (c) purchases by a broker
or dealer as principal and resales by such broker or dealer for its account
pursuant to this Prospectus. In effecting sales, brokers or dealers engaged by
the Selling Shareholder may arrange for other brokers or dealers to participate.
Brokers or dealers will receive commissions or discounts from the Selling
Shareholder in amounts to be negotiated immediately prior to the sale. Such
brokers or dealers and any other participating brokers or dealers may be deemed
to be "underwriters" within the meaning of the Securities Act in connection with
such sales. In addition, any securities covered by this Prospectus which qualify
for sale pursuant to Rule 144 under the Act may be sold under Rule 144 rather
than pursuant to this Prospectus.
The Company and the Selling Shareholder have agreed to indemnify each
other against certain liabilities, including liabilities arising under the
Securities Act.
MATERIAL CHANGES
On May 17, 1996, the Company announced that it had become aware of an
attempt to initiate a patent interference proceeding which had been filed with
the U.S. Patent and Trademark Office ("PTO") on its issued metal-on-metal
bipolar scissors patent by a yet-to-be-identified party.
An interference is a PTO action to determine who, as between two
different inventors, is entitled to the patent on the same invention, and if
declared, will result in the PTO rendering a decision on ownership of a patent.
The PTO is currently reviewing the application to determine if it will declare
the interference. Until the interference is formally declared by the PTO, the
identity of the applicant and the basis for the action is not disclosed. The
Company has learned that if an interference is declared, it will be the senior
party to the action. The Company has been advised by its outside patent counsel
that, based on experience and published statistics, the senior party in an
interference action is more likely than not to prevail in such an action. The
Company cannot, however, predict the outcome of the interference action.
In addition, the Company recently announced that it has received a
notice of allowance from the PTO for a next generation bipolar scissors design.
The Company has received a written opinion from its outside patent counsel that
states that this new bipolar scissors design would not be adversely affected by
an unfavorable ruling by the PTO that the metal-on-metal design patent is
invalid. Therefore, even if the Company were not to prevail in the interference
action, the Company believes that the next generation bipolar scissors design
would allow it to continue to participate in the bipolar scissors marketplace.
7
<PAGE>
On May 28, 1996, the Company announced that the PTO has granted the
Company's request for reexamination of its issued bipolar cutting forceps
patent. A re-examination is a PTO action to review an issued patent in the
context of newly discovered prior art that was not considered by the PTO when
the patent was issued. The Company cannot predict the outcome of this action.
The PTO has the authority to leave the patent in its present form, reduce the
claims of the patent or invalidate the patent. The Company commenced shipments
of a 10mm version of the cutting forceps with a new locking feature in April
1996. In addition, the Company has recently announced the introduction of a 5mm
version of the device with shipments targeted to commence in June 1996.
Statements in the registration statement are forward-looking statements
as defined under the Private Securities Litigation Reform Act and involve
material risks and uncertainties relating to future actions of the PTO.
8
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with this offering are as follows:
Securities and Exchange Commission
Filing Fee.................................................$3,830
Legal Fees and Expenses.......................................5,000*
Accounting Fees and Expenses..................................1,000*
Miscellaneous................................................ 500*
Total Expenses..............................................$10,330*
*Estimated
Item 15. Indemnification of Directors and Officers.
Section 302A.521 of the Minnesota Business Corporation Act provides
that a corporation shall indemnify any person who was or is threatened to be
made a party to any proceeding by reason of the former or present official
capacity of such person, against judgments, penalties and fines, including,
without limitation, excise taxes assessed against such person with respect to an
employee benefit plan, settlements and reasonable expenses, including attorneys'
fees and disbursements, incurred by such person in connection with the
proceeding, if, with respect to the acts or omissions of such person complained
of in the proceeding, such person has not been indemnified by another
organization or employee benefit plan for the same expenses with respect to the
same acts or omissions, acted in good faith, received no improper personal
benefit and Section 302A.255 (which pertains to director conflicts of interest),
if applicable, has been satisfied; in the case of a criminal proceeding, had no
reasonable cause to believe the conduct was unlawful; and in the case of acts or
omissions by person in their official capacity for the corporation, reasonably
believed that the conduct was in the best interests of the corporation, or in
the case of acts or omissions by persons in their capacity for other
organizations, reasonably believed that the conduct was not opposed to the best
interests of the corporation.
Section 302A.521 also permits Minnesota corporations to amend their
Articles of Incorporation to limit or eliminate personal liability of directors
to the corporation or its shareholders for monetary damages for breach of
fiduciary duty; however, forbids any limitation or elimination of director
liability for (i) a breach of the director's duty of loyalty, (ii) acts or
omissions not in good faith or that involve intentional misconduct or a knowing
violation of law, (iii) corporate distributions which are either illegal or in
contravention of restrictions in the Articles, Bylaws or any agreement to which
the corporation is a party, (iv) violations of Minnesota securities laws, (v)
any transaction from which the director derived an improper personal benefit, or
(vi) any act or omission occurring prior to the effective date of the provision
in the corporation's Articles eliminating or limiting liability.
Article 3.06 of the Registrant's Restated Articles of Incorporation
reads as follows:
To the full extent that the Minnesota Business Corporation Act,
Chapter 302A, as it exists on the date hereof or may hereafter be
amended, permits the limitation or elimination of the liability of
directors, a director of this Corporation shall not be liable to the
Corporation or its shareholders for monetary damages for breach of
fiduciary duty as a director. Any amendment to or repeal of this
Section 3.06 shall not adversely affect any right or protection as a
director of the Corporation for or with respect to any acts or
omissions of such director occurring prior to such amendment or
repeal.
9
<PAGE>
The Company's Bylaws provide for the indemnification of its directors,
officers, employees and agents in accordance with, and to the fullest extent
permitted by, Section 302A.521 of the Minnesota Business Corporation Act, as
amended from time to time.
Item 16. Exhibits.
Exhibit No. Document
4.1 Registrant's Restated Articles of Incorporation, as amended.
(Incorporated by reference to Exhibit 3.1 to the Company's
Registration Statement on Form S- 18, File Number 33-37352-C).
4.2 Registrant's Bylaws, as amended. (Incorporated by reference to
Exhibit 3.2 to the Company's Registration Statement on Form S-18,
File Number 33-37352- C).
5 Opinion and Consent of Fredrikson & Byron, P.A.
23.1 Consent of Ernst & Young LLP
23.2 Consent of Fredrikson & Byron, P.A. - included in their opinion
filed as Exhibit 5.
24 Power of attorney from certain directors and officers - see
"Signatures Page."
10
<PAGE>
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(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;
(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;
Provided, however, that paragraphs (a)(1)(i) and (a)(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 Section 13
or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purposes 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.
(b) The undersigned Registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933,
each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Registrant pursuant to the
foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of 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 final adjudication of such issue.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
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 Minneapolis, State of Minnesota, on the 11th day of
June, 1996.
EVEREST MEDICAL CORPORATION
By /s/ John L. Shannon, Jr.
John L. Shannon, Jr.
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
(Power of Attorney)
Each person whose signature appears below constitutes and appoints JOHN
L. SHANNON, JR. and THOMAS F. MURPHY his true and lawful attorneys-in-fact and
agents, each acting alone, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
or all amendments to the Registration Statement on Form S-3 of Everest Medical
Corporation and to file the same, with all exhibits thereto, and other documents
in connection therewith with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, each acting alone, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully and for all intent and purposes
as he might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, each acting alone, or their substitute or
substitutes, may lawfully do or cause to be done by virtue thereof.
Signature Title Date
/s/ John L. Shannon, Jr. President and June 11, 1996
John L. Shannon, Jr. Chief Executive Officer
(Principal
Executive Officer)
/s/ Thomas F. Murphy Chief Financial Officer June 11, 1996
Thomas F. Murphy and Assistant Secretary
(Principal Financial
and Accounting Officer)
/s/ David D. Koentopf Chairman of the Board June 11, 1996
David D. Koentopf
/s/ Donald R. Brattain Director June 11, 1996
Donald R. Brattain
/s/ Richard J. Migliori Director June 11, 1996
Richard J. Migliori, M.D.
12
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
to
Form S-3 Registration Statement
Everest Medical Corporation
(Exact name of Registrant as specified in its charter)
INDEX
Exhibit
4.1 The Registrant's Articles of Incorporation*
4.2 The Registrant's Bylaws*
5 Opinion and consent of Fredrikson & Byron, P.A.
23.1 Consent of Ernst & Young LLP
23.2 Consent of Fredrikson & Byron, P.A. (See Exhibit 5)
24 Power of attorney from certain directors and officers (included on
Signature Page)
- --------------------
* Incorporated by reference
13
June 11, 1996
Everest Medical Corporation
13755 First Avenue North
Minneapolis, MN 55441
Re: EXHIBIT 5 to Registration Statement on Form S-3
Ladies/Gentlemen:
We are acting as corporate counsel to Everest Medical Corporation (the
"Company") in connection with the preparation and filing of a Registration
Statement on Form S-3 (the "Registration Statement") relating to the
registration under the Securities Act of 1933, as amended (the "Act") of
4,180,471 shares of the Company's Common Stock (the "Shares"), including (i)
19,077 Shares to be sold by a Selling Shareholder; (ii) 1,066,937 Shares
issuable upon conversion of 1,066,937 outstanding shares of the Company's Series
A Preferred Stock; (iii) 679,773 Shares issuable upon conversion of 679,773
outstanding shares of the Company's Series B Preferred Stock; (iv) 316,361
Shares issuable upon conversion of 316,361 outstanding shares of the Company's
Series C Preferred Stock; (v) 300,000 Shares issuable upon conversion of 300,000
outstanding shares of the Company's Series D Preferred Stock (with the Series A,
B, C and D Preferred Stock collectively referred to herein as the "Preferred
Stock"); (vi) 1,548,323 Shares issuable upon exercise of currently outstanding
warrants (the "Warrants") and (vii) 250,000 Shares issuable upon conversion of
an outstanding Convertible Note (the "Note").
In acting as such counsel and for the purpose of rendering this opinion, we have
reviewed copies of the following, as presented to us by the Company:
1. The Company's Restated Articles of Incorporation, as amended.
2. The Company's Bylaws, as amended.
3. Certain corporate resolutions of the Company's Board of Directors
pertaining to the issuance by the Company of the Shares.
4. The Note.
5. The Warrants.
6. The Registration Statement.
Based on, and subject to, the foregoing and upon representations and information
provided by the Company or its officers or directors, it is our opinion as of
this date that:
1. The Shares are validly authorized by the Company's Articles of
Incorporation.
2. Upon conversion of the Preferred Stock or the Note or upon exercise
of the Warrants, in accordance with their respective terms, and upon the
issuance and delivery of the Shares issuable upon such conversion or exercise
against receipt by the Company of consideration therefor as called for by the
Preferred Stock, the Note and the Warrants, such Shares will be validly issued
and outstanding, fully paid and nonassessable.
3. The 19,077 Shares to be sold by the Selling Shareholder have been
duly authorized and issued and, when sold as contemplated by the Registration
Statement, will be validly issued and outstanding, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
FREDRIKSON & BYRON, P.A.
By /s/ Thomas R. King
Thomas R. King
EXHIBIT 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in this Registration Statement
(Form S-3) and related Prospectus of Everest Medical Corporation for the
registration of 4,180,471 shares of its common stock of our report dated January
12, 1996, with respect to the financial statements of Everest Medical
Corporation included in its Annual Report (Form 10-KSB) for the year ended
December 31, 1995, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Minneapolis, Minnesota
June 7, 1996
