<PAGE>
As filed with the Securities and Exchange Commission on May 8, 1996
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
(Exact name of issuer as specified in its charter)
TEXAS 74-2048763
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2210 DENTON DRIVE, SUITE 106, AUSTIN, TEXAS 78758
(Address of Principal Executive Offices) (Zip Code)
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
1990 LONG-TERM INCENTIVE PLAN
AND NON-QUALIFIED STOCK OPTIONS
(Full title of the plan)
KEITH A. JEZEK
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
2210 DENTON DRIVE, SUITE 106
AUSTIN, TEXAS 78758
(512) 837-4712
FAX: (512) 837-9082
(Name, address, and telephone number of agent for service)
Copies to:
J. ROWLAND COOK, ESQ.
JENKENS & GILCHRIST, A PROFESSIONAL CORPORATION
600 CONGRESS AVENUE, SUITE 2200
AUSTIN, TEXAS 78701
(512) 499-3800
FAX: (512) 404-3520
==================================
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities to be Amount to be Registered Offering Price Per Aggregate Offering Registration Fee (1)
Registered (1) Share (2) Price(1)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 4,909,482 $0.795 $3,903,038 $1,345.88
$.05 par value
===================================================================================================================================
</TABLE>
(1) Shares (including related rights to acquire shares) issued or issuable
pursuant to incentive stock options, non-qualified stock options, stock
appreciation rights, restricted stock awards, and performance units under
the Scientific Measurement Systems, Inc. 1990 Long-Term Incentive Plan. and
shares issuable pursuant to the Scientific Measurement Systems, Inc. Non-
Qualified Stock Options Pursuant to Rule 416, there are also being
registered such additional shares of Common Stock as may become issuable
pursuant to the anti-dilution provisions of that Plan.
(2) Pursuant to Rule 457(h), the offering price and registration fee are
computed on the basis of the average of the bid and asked closing prices of
the Common Stock, as reported on the NASDAQ OTC Bulletin Board on May 6,
1996.
================================================================================
<PAGE>
PROSPECTUS
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
480,000 Shares of Common Stock
This Prospectus concerns the offer and sale by Selling Shareholders, from
time to time, of 480,000 shares of the common stock, $.05 par value (the "Common
Stock"), of Scientific Measurement Systems, Inc., a Texas corporation (the
"Company"). Of the 480,000 shares of Common Stock to be offered and sold by
Selling Shareholders, 280,000 shares represent shares issued or issuable upon
exercise of options issued under the 1990 Incentive Plan and 200,000 represent
shares issued or to be issued on exercise of non-qualified options granted by
the Company from time to time. See "Selling Shareholders." The Company will
not receive any of the proceeds from the sale of the Common Stock by the Selling
Shareholders.
The Company's Common Stock is traded over-the-counter on the OTC Bulletin
Board and quoted by the National Association of Securities Dealers Automated
Quotation System ("NASDAQ") under the symbol SCMS. On May 6, 1996, the closing
sale price for the Company's Common Stock as quoted on NASDAQ, was $0.795 per
share. The options are not listed or quoted on any exchange or automated
quotation system, and there is no regular trading market for such shares.
It is presently anticipated that sales of securities by the Selling
Shareholders hereunder will be effected, from time to time, (i) through dealers
or in ordinary broker transactions through the NASDAQ OTC Bulletin Board, or
otherwise; (ii) "at the market" to or through market makers or into an existing
market for the securities; (iii) in other ways not involving market makers or
established trading markets, including direct sales to purchasers or sales
effected through agents; (iv) through transactions in options (whether exchange-
listed or otherwise); or (v) in combinations of any such methods of sale. The
securities held by the Selling Shareholders may also be sold hereunder by
brokers, dealers, banks or other persons or entities who receive such securities
as a pledgee of the Selling Shareholders. The Selling Shareholders and brokers
and dealers through whom sales of Securities may be effected may be deemed to be
"underwriters," as defined under the Securities Act of 1933 (the "Securities
Act"), and any profits realized by them in connection with the sale of the
Securities may be considered to be underwriting compensation.
THE SECURITIES OFFERED HEREBY ARE HIGHLY SPECULATIVE AND INVOLVE A HIGH
DEGREE OF RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 4 HEREOF.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE DATE OF THIS PROSPECTUS IS MAY 8, 1996.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the reporting and informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "SEC"). Such reports, proxy
statements and other information can be inspected and copied at public reference
facilities of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 and at
the Regional Offices of the SEC located at 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661; and 7 World Trade Center, Suite 1300, New York, New
York 10048. The Company's Common Stock is traded on the NASDAQ OTC Bulletin
Board and reports, proxy statements and other information concerning the Company
may be inspected at the offices of NASDAQ Operations, 1735 K Street, N.W.,
Washington, D.C. 20006.
The Company has filed with the SEC a Registration Statement on Form S-8 (of
which this Prospectus is a part) under the Securities Act with respect to the
securities offered hereby. For further information with respect to the Company
and the securities offered by this Prospectus, reference is made to such
Registration Statement and the exhibits thereto. This Prospectus does not
contain all the information set forth in the Registration Statement on Form S-8
(the "Registration Statement") or the exhibits thereto. Statements contained in
this Prospectus as to the contents of any contract or other document are not
necessarily complete, and in each instance reference is made to the copy of such
contract or other document filed as an exhibit to the Registration Statement or
otherwise filed with the Commission for a full statement of the provisions
thereof. Each such statement contained herein is qualified in its entirety by
such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the SEC pursuant to the
Exchange Act are hereby incorporated by reference into this Prospectus:
(1) Annual Report on Form 10-KSB for the fiscal year ended July 31, 1995;
and
(2) Quarterly Reports on Form 10-QSB for the quarterly periods ended
October 31, 1995 and January 31, 1996;
All documents filed by the Company pursuant to Sections 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 made hereby shall be deemed to be incorporated
by reference in this Prospectus and to be a part hereof from the respective
dates of the filing of such documents. Any statement or information contained
in a document incorporated or deemed to be incorporated herein by reference
shall be deemed modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person who receives a
Prospectus, upon written or oral request of such person, a copy of any of the
information that is incorporated by reference in this Prospectus (not including
exhibits to the information that is incorporated by reference unless the
exhibits are themselves specifically incorporated by reference). Such a request
should be directed to Keith A. Jezek, at the principal executive offices of the
Company which are located at 2210 Denton Drive, Suite 106, Austin, Texas 78758,
or if by telephone, (512) 837-4712.
2
<PAGE>
THE COMPANY
Scientific Measurement Systems, Inc. was incorporated in Texas in 1979.
The Company has pioneered the development of industrial tomography by using
techniques similar to the medical industry's CAT scanner. The Company is now a
significant producer of Computerized Industrial Tomographic and Digital
Radiographic Systems. The Company's systems have a large number of uses
including nondestructive measurement and evaluation, testing and analysis, and
reverse engineering which can produce computer-aided design and computer-
integrated manufacturing models. These functions are utilized by industrial
companies and government agencies involved in research, aerospace, aviation,
automotive, machinery, oil and gas, steel and advanced materials manufacture,
among others.
3
<PAGE>
RISK FACTORS
In addition to the other information in this Prospectus, the following risk
factors should be considered carefully in evaluating the Company and its
business before purchasing shares of the Common Stock offered hereby. This
Prospectus contains forward-looking statements which involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including those set forth in the following risk factors and elsewhere in this
Prospectus.
LACK OF PROFITABILITY AND CAPITAL. From the date of inception of the
Company in March 1976 through July 31, 1995, the Company sustained net losses
totaling $9,243,979 and only since August 1995 has the Company sustained
profitable operations on a quarterly basis.
SUBSTANTIAL COMPETITION. The non-destructive testing and evaluation
industry is highly competitive, and the Company faces competition from companies
with substantially greater financial and technological resources and greater
production capacity and experience, including, but not limited to, ARACOR, Inc.
and Bio-Imaging Research, Inc., which make or are capable of making competitive
products.
BACKLOG. The Company currently has orders for five systems representing a
backlog $3.0 million. However, there is no assurance that the Company will be
able to obtain future orders for its systems or that the number of future orders
which may be obtained will be sufficient to enable the Company to operate
profitably.
PATENTS. The Company owns certain U.S. and foreign patents, patent
applications, and technology know-how relating to its basic system. The
issuance of a patent is not conclusive as to its validity or enforceability; and
there has been no independent study of other patents or prior art which might be
infringed by the Company's systems. Attempts by the Company to enforce or
defend its patent rights could result in substantial expense. The Company's
technology may be subject to appropriation without compensation in some areas of
the world and may be subject to use without compensation by the U.S. government
in connection with government contracts.
PRODUCT LIABILITY INSURANCE. The Company does not carry product liability
insurance. There can be no assurance that suits may not be filed or judgments
obtained against the Company in the future in excess of available funds or any
insurance coverage which may then be in effect. Additionally, should it be
determined that product liability insurance is necessary or desirable, the cost
could have a material effect upon the cost of the tomographic systems, thereby
having an adverse effect on the sales price of such systems and the
competitiveness of the Company.
USE OF X-RAY EQUIPMENT AND RADIOACTIVE ISOTOPES. The Company's tomographic
systems utilize x-ray equipment and, to a lesser extent, radioactive isotope
sources. The Company believes that it complies with all current governmental
regulations regarding such equipment and materials. Changes in safety
regulations regarding their use and sale could cause the Company additional
expense and increase the cost of its systems, which could have an adverse impact
upon sales or uses of its systems.
DEPENDENCE ON KEY PERSONNEL. The Company's business to date has been
primarily dependent upon the efforts of key scientists and upon its senior
executive officers. The loss of any of these key persons could have a material
adverse effect upon the Company's business.
LACK OF DIVIDENDS. The holders of the Company's Common Stock are entitled
to receive dividends from funds legally available therefor, when and as declared
by the Board of Directors. No cash dividends have historically been paid on the
Company's Common Stock and no dividends are anticipated in the foreseeable
future, since the Company intends to retain earnings, if any, for use in its
business.
4
<PAGE>
RELIANCE ON SUPPLIERS. The Company is dependent in several respects on its
suppliers for x-ray systems. While the Company believes that it has good
relationships with all of its major suppliers, there can be no assurance that it
will be able to maintain these relationships.
SECURITIES MARKET FACTORS. There have been periods of volatility in the
market for the Company's securities, which in many cases were unrelated to the
operating performance of or announcements concerning the Company. During such
periods, the market prices of the Company's securities have fluctuated
substantially. Within the twelve months ending April 30, 1996, the market price
of the Common Stock has ranged from $0.06 to $1.65). General market price
declines or market volatility in the future could adversely affect the price of
the securities. The lack of a significant public float may also limit the
ability of shareholders to liquidate their investment in a timely fashion. At
April 30, 1996, the aggregate number of shares of Common Stock and the market
value of Common Stock held by non-affiliates was approximately 12.0 million
shares and $10.2 million, respectively. There can be no assurance that the
Common Stock will not continue to be subject to periods of extreme volatility.
SHARES OF COMMON STOCK ELIGIBLE FOR SALE. The Company has in the past
registered for offer and sale under the Securities Act certain of the issued and
outstanding shares of Common Stock and certain of the shares of Common Stock
issuable upon the exercise or conversion, as applicable, of outstanding options,
warrants and convertible securities held by the Company's shareholders,
including certain officers, directors, employees and "affiliates" of the Company
(as such term is defined pursuant to the Exchange Act). The sale of such shares
would have been subject to substantial limitations in the absence of such
registration. In addition, certain shareholders of the Company hold the right
(subject to certain conditions) to require that the Company register for offer
and sale issued and outstanding shares of Common Stock. Sales of substantial
amounts of such shares, and sales of shares pursuant to this registration, or
otherwise, could adversely affect the market value of the Common Stock.
LIMITATIONS ON REMEDIES AND INDEMNIFICATION. The Company's Amended and
Restated Articles of Incorporation provide that a director shall not be
personally liable to the Company or its shareholders for any monetary damages
for any act or omission in his capacity as a director, except to the extent
otherwise expressly provided by the laws of the State of Texas. Therefore, the
Company may be unable to recover damages for certain alleged errors or omissions
by officers and directors. The Articles of Incorporation also provide that the
Company will indemnify its officers and directors, in their capacities as such,
to the maximum extent permitted by law.
NEED FOR ADDITIONAL FINANCING. Historically, the Company has relied upon
contract progress payments as a means of financing the production and delivery
of systems. Recently, the Company has accepted in certain instances contracts
not providing for such payments. Consequently, only about half of the contracts
which comprise the Company's current backlog contain contract financing
provisions. The Company therefore may need to implement additional actions,
such as negotiating more favorable terms with vendors and accelerating
collections of the Company's receivables, in order to produce and deliver its
current backlog. If these measures are not adequate, then the Company may
require supplemental working capital financing. Management is in discussions
with several different potential sources of these funds; however, there can be
no assurance that these discussions will prove successful.
5
<PAGE>
RECENT DEVELOPMENTS
A challenge to the Company's liquidity is the notification in
September 1995 by the National Institute of Standards of Technology (NIST) that
the Company, along with its team members General Electric, General Motors, and
EG&G, was awarded an Advanced Technology Program (ATP) grant for the development
of a "Fast, Volumetric X-ray Scanner for Three-Dimensional Characterization of
Critical Objects." Total project funds are estimated at $7,659,000. ATP funds
committed to this project total $3,753,000. The ATP funds are "cost sharing"
funds, budgeted to match expenditures by the industrial partners. Pursuit of
this project would require incremental funding for the Company's portion of the
industrial cost share. Management is engaged in discussions with several
sources of financing for this project as well.
In March 1996, Howard L. Burris, a director of the Company, converted
$90,000 of principal due under a promissory note payable to him by the Company,
together with $6260.50 of interest due thereon, into Common Stock at the rate of
one share of Common Stock for each $.06 of debt. Mr. Burris received 1,604,341
shares of Common Stock in this transaction. Also in March 1996, Neils Thompson,
Chairman Emeritus of the Board of Directors, converted $10,000 of principal due
under a promissory note payable to him by the Company, together with $616 of
interest due thereon, into Common Stock at the rate of one share of Common Stock
for each $.06 of debt. Mr. Thompson received 176,933 shares of Common Stock in
this transaction.
6
<PAGE>
SELLING SHAREHOLDERS
The Selling Shareholders are listed below. Included below concerning each
Selling Shareholder is the total amount and percentage of the Company's Common
Stock beneficially owned by such person, the amount subject to sale hereunder
and the resulting amount and percentage if all Shares offered hereby which are
owned by such person or entity are sold. Except as described herein, none of
the Selling Shareholders has held any position or office, or had any other
material relationship with the Company during the past three years. The
following table reflects ownership of shares of Common Stock acquired or to be
acquired pursuant to the exercise of options granted pursuant to the 1990 Plan
or pursuant to certain non-qualified stock option agreements.
<TABLE>
<CAPTION>
SHARES SHARES
BENEFICIALLY SHARES TO BE BENEFICIALLY
OWNED PRIOR TO SOLD IN OWNED AFTER
THE OFFERING (1) OFFERING (1) OFFERING
NAME # # %
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
J. Neils Thompson /(2)/ 990,606/(6)/ 220,000 770,606 4.7%
Robert J. Dixon /(3)/ 100,000 50,000 50,000 *
George A. Edwards /(4)/ 308,377 60,000 248,377 1.5%
Thomas Prud'homme /(5)/ 150,000 150,000 0 *
</TABLE>
* Less than 1%
(1) Shares of Common Stock that are not outstanding but that can be acquired by
a person within 60 days upon exercise of an option or similar right are
included in the number of shares beneficially owned and in computing the
percentage for such person but are not included in the number of shares
beneficially owned and in computing the percentage for any other person.
(2) J. Neils Thompson served as Chairman of the Board and a director from 1980
until 1995.
(3) General Robert J. Dixon served as a director from 1986 until 1995.
(4) General George A. Edwards, Jr. served as a Vice President and as Secretary-
Treasurer from 1988 until 1994.
(5) Thomas Prud'homme has served as a director since 1990.
(6) Includes shares underlying options to purchase 394,431 shares of Common
Stock, all of which are immediately exercisable.
7
<PAGE>
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 40,000,000 shares of
Common Stock, $.05 par value per share, and 2,000,000 shares of undesignated
preferred stock, $.15 par value per share.
COMMON STOCK
The holders of Common Stock are entitled to one vote per share on all matters
submitted to a vote of the shareholders. Cumulative voting in the election of
directors is prohibited. Accordingly, the holders of a majority of the
outstanding shares of Common Stock may elect all of the directors standing for
election. Holders of Common Stock are entitled to receive ratably such
dividends, if any, as may be declared by the Board of Directors out of funds
legally available therefor, subject to any preferential dividend rights of
outstanding preferred stock, if any. Upon a liquidation, dissolution or winding
up of the Company, the holders of Common Stock are entitled to receive ratably
the net assets of the Company available after the payment of all debts and other
liabilities and subject to the prior rights of any outstanding preferred stock.
The holders of the Common Stock have no preemptive, subscription ,redemption or
conversion rights. The outstanding shares of Common Stock are, and the shares
issued upon exercise of outstanding options, which are registered herein, will
be when issued and paid for, fully paid and non-assessable.
As of May 1, 1996, the outstanding shares of Common Stock were owned of
record by 733 shareholders.
PREFERRED STOCK
There are 2,000,000 shares of undesignated preferred stock authorized and no
shares of preferred stock issued or outstanding.
TRANSFER AGENT AND REGISTRAR
The Transfer Agent and Registrar for the Common Stock is Key Corp Shareholder
Services, Inc., Dallas, Texas.
INDEMNIFICATION OF OFFICERS AND DIRECTORS; LIMITATION OF DIRECTOR LIABILITY
The Company's Restated Articles of Incorporation provide that the directors
shall not be liable for monetary damages caused by an act or omission occurring
in their capacity as directors. This provision does not eliminate the duty of
care, and, in appropriate circumstances, equitable remedies such as injunctive
or other forms of non-monetary relief will remain available under Texas law. In
addition, each director will continue to be subject to liability for breach of
the director's duty of loyalty to the Company, for acts of omissions not in good
faith or involving intentional misconduct, for knowing violations of law, for
actions leading to improper personal benefit to a director and for acts or
omissions for which a director is made expressly liable by applicable statute,
such as the improper payment of dividends. The limitations on liability
provided for in the Articles of Incorporation do not restrict the availability
of non-monetary remedies and do not affect a director's responsibilities under
any other law, such as the federal securities laws or state of federal safety
laws. The Company believes that these provisions will assist the Company in
attracting and retaining qualified individuals to serve as executive officers
and directors of the Company.
8
<PAGE>
EXPERTS AND COUNSEL
The consolidated financial statements of the Company as of July 31, 1995
and for each of the years ended July 31, 1995 and 1994 have been incorporated by
reference herein and in the registration statement in reliance upon the report
of BDO Seidman, LLP, independent certified public accountants, incorporated by
reference herein, and upon the authority of said firm as experts in accounting
and auditing.
The validity of the securities offered hereby has been passed on for the
Company by Jenkens & Gilchrist, A Professional Corporation, Austin, Texas.
9
<PAGE>
No person is authorized to give any information or to make any representation
not contained or incorporated by reference in this Prospectus, and if given or
made, such information or representation must not be relied upon as having been
authorized by the Company. Neither the delivery of this Prospectus nor any sale
made hereunder shall, under any circumstances, create an implication that there
has been no change in the facts set forth in this Prospectus or in the affairs
of the Company since the date hereof. This Prospectus does not constitute an
offer to sell or a solicitation of an offer to buy any securities other than
those to which it relates or an offer to sell or a solicitation of an offer to
buy any securities in any jurisdiction in which such offer or solicitation is
not authorized, or in which the person making such offer or solicitation is not
qualified to do so, or to any person to whom it is unlawful to make such an
offer or solicitation in such jurisdiction.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
PROSPECTUS 1
AVAILABLE INFORMATION 3
INCORPORATION OF CERTAIN
INFORMATION BY REFERENCE 3
RISK FACTORS 4
SELLING SHAREHOLDERS 12
EXPERTS AND COUNSEL 14
</TABLE>
480,000 SHARES OF
COMMON STOCK
OF
SCIENTIFIC
MEASUREMENT
SYSTEMS, INC.
__________________
PROSPECTUS
__________________
MAY 8, 1996
10
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The documents listed in (a) and (b) below are hereby incorporated by
reference into this Registration Statement. All documents subsequently filed
by the Company or the 1990 Long Term Incentive Plan (the "Plan") pursuant to
Sections 13(a), 13(b), 14 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") after the date of this Registration Statement and
prior to the filing of any post-effective amendment to the Registration
Statement which indicate that all shares of Common Stock, $.05 par value per
share, offered hereunder have been sold or that deregister all such shares then
remaining unsold shall be deemed to be incorporated herein by reference and to
be a part hereof from the date of filing of such documents.
(a) The Company's latest annual report filed pursuant to Section 13 or
15(d) of the Exchange Act or the latest prospectus filed pursuant to Rule 424(b)
under the Securities Act of 1933, as amended (the "Securities Act"), which
contain, either directly or by incorporation by reference, certified financial
statements for the Company's latest fiscal year for which such statements have
been filed.
(b) All other reports filed pursuant to Section 13 or 15(d) of the Exchange
Act since the end of the fiscal year covered by the annual report referred to in
(a) above.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
None.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Articles of Incorporation require indemnification of officers and
directors to the maximum extent provided by law, and provide that its directors
shall not be liable for monetary damages caused by an act or omission occurring
in their capacity as directors. This provision does not eliminate the duty of
care, and, in appropriate circumstances, equitable remedies such as injunctive
or other forms of non-monetary relief will remain available under Texas law. In
addition, each director will continue to be subject to liability for breach of
the director's duty of loyalty to the Company, for acts or omissions not in good
faith or involving intentional misconduct, for knowing violations of law, for
actions leading to improper personal benefit to a director and for acts or
omissions for which a director is made expressly liable by applicable statute,
such as the improper payment of dividends. The limitations on liability
provided for in the Articles of Incorporation do not restrict the availability
of non-monetary remedies and do not affect a director's responsibilities under
any other law, such as the federal securities laws or state or federal
environmental laws. The Company believes that these provisions will assist the
Company in attracting and retaining individuals to serve as executive officers
and directors.
II-1
<PAGE>
The Company has obtained an insurance policy insuring its officers and
directors against certain liabilities, including liabilities incurred under the
securities laws. The policy remains in effect until August 26, 1996 and
provides insurance of up to $2,000,000 in the aggregate, with certain
exclusions, including but not limited to an exclusion for prior or pending
litigation.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Restricted securities to be reoffered or resold pursuant to this
registration statement were offered and sold in reliance upon Section 4(2) of
the Securities Act as not involving any public offering. Such securities were
offered and sold to a limited number of persons, each of whom was an officer,
director or employee of the Company.
ITEM 8. EXHIBITS
4.1 Restated Articles of Incorporation (incorporated by reference to
Exhibit 3.1 to the Registration Statement on Form S-18 effective March
5, 1985 (File No. 2-94269-FW)
4.2 Amendment to Articles of Incorporation (incorporated by reference to
Exhibit 3.1A to the Annual Report on Form 10-K for the Fiscal Year
Ended July 31, 1991)
4.3 Bylaws (incorporated by reference to the Registration Statement on Form
S-18 effective March 5, 1985 (File No. 2-94269-FW)
4.4 Amendment to Bylaws (incorporated by reference to Exhibit 3.2A to the
Annual Report on Form 10-K for the Fiscal Year Ended July 31, 1991)
4.5 Scientific Measurement Systems, Inc. 1990 Long-Term Incentive Plan
(incorporated by reference to Exhibit A to the Company's Proxy
Statement for 1990 Annual Meeting of Shareholders filed October 29,
1990)
5.1* Opinion of Jenkens & Gilchrist, A Professional Corporation
23.1* Consent of Jenkens & Gilchrist, A Professional Corporation (See
Exhibit 5)
23.2* Consent of BDO Seidman, LLP
25* Power of Attorney (included on the signature page of the Registration
Statement)
* filed herewith
ITEM 9. UNDERTAKINGS.
I. The undersigned registrant hereby undertakes:
A. To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
1. To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
II-2
<PAGE>
2. To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information set forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in
the form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent
no more than a 20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the effective
registration statement;
3. To include any additional or changed material information on
the plan of distribution;
Provided, however, that paragraphs I.A.1. and I.A.2. do not apply if
the registration state ment is on Form S-3 or Form S-8 and 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 this registration statement.
B. 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.
C. To file a post-effective amendment to remove from registration any
of the securities being registered which remain unsold at the termination
of the offering.
II-3
<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 of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Austin, State of Texas, on this 7th day of May, 1996.
SCIENTIFIC MEASUREMENT SYSTEMS, INC.
(registrant)
By: /s/Larry Secrest
----------------------------------------
Larry Secrest, President and
Chief Executive Officer
POWER OF ATTORNEY
The Company and each person whose signature appears below hereby designates
and appoints Keith A. Jezek and Larry Secrest and each of them, as its or his
attorneys-in-fact (the "Attorneys-in-Fact") with full power to act alone, and to
execute in the name and on behalf of the Company and each such person,
individually in each capacity stated below, one or more amendments (including
post-effective amendments) to this Registration Statement, which amendments may
make such changes in this Registration Statement as either Attorney-in-Fact
deems appropriate, and to file each such amendment to this Registration
Statement together with all exhibits thereto and any and all documents in
connection therewith.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signatures Title Date
---------- ----- ----
/s/Larry Secrest President, Chief Executive Officer, May 7, 1996
- -------------------------- and Chairman of the Board of Directors
Dr. Larry Secrest
/s/Howard L. Burris, Jr. Director May 7, 1996
- --------------------------
Howard L. Burris, Jr.
/s/Douglas G. Chaffin Director May 7, 1996
- --------------------------
Douglas G. Chaffin
Director May _, 1996
- --------------------------
Dr. Norman Hackerman
Director May _, 1996
- --------------------------
Burton W. Kanter
/s/James W. Kenney Director May 8, 1996
- --------------------------
James W. Kenney
Director May _, 1996
- --------------------------
Phillips A. Moore
/s/Thomas Prud'homme Director May 7, 1996
- --------------------------
Dr. Thomas Prud'homme
Director May _, 1996
- --------------------------
Nancy Woodward
II-4
<PAGE>
/s/Keith A. Jezek Chief Financial Officer, Secretary, May 7, 1996
- -------------------------- Treasurer (Principal Financial
Keith A. Jezek and Accounting Officer)
II-5
<PAGE>
INDEX TO EXHIBITS
Exhibit Sequentially
Number Exhibit Numbered Page
- ------- ------- -------------
4.1 Restated Articles of Incorporation (incorporated by
reference to Exhibit 3.1 to the Registration Statement
on Form S-18 effective March 5, 1985 (File No. 2-94269-FW)
4.2 Amendment to Articles of Incorporation (incorporated by
reference to Exhibit 3.1A to the Annual Report on Form 10-K
for the Fiscal Year Ended July 31, 1991)
4.3 Bylaws (incorporated by reference to the Registration
Statement on Form S-18 effective March 5, 1985
(File No. 2-94269-FW)
4.4 Amendment to Bylaws (incorporated by reference to
Exhibit 3.2A to the Annual Report on Form 10-K for the
Fiscal Year Ended July 31, 1991)
4.5 Scientific Measurement Systems, Inc. 1990 Long-Term
Incentive Plan (incorporated by reference to Exhibit A
to the Company's Proxy Statement for 1990 Annual Meeting of
Shareholders filed October 29, 1990)
5.1 Opinion of Jenkens & Gilchrist, A Professional Corporation
23.1 Consent of Jenkens & Gilchrist, A Professional Corporation
(See Exhibit 5.1)
23.2 Consent of BDO Seidman, LLP
25.1 Power of Attorney (included on the signature page of the
Registration Statement)
II-6
<PAGE>
EXHIBIT 5.1
May 7, 1996
Scientific Measurement Systems, Inc.
2210 Denton Drive, Suite 106
Austin, Texas 78758
Ladies and Gentlemen:
We have acted as counsel to Scientific Measurement Systems, Inc., a Texas
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of options to acquire 4,909,482
shares of Common Stock, $.05 par value per share (the "Shares") and 4,909,482
shares issuable on exercise of such options, of the Company pursuant to a
Registration Statement on Form S-8, as filed with the Securities and Exchange
Commission on May 8, 1996 (the "Registration Statement").
In connection with this opinion, we have examined and are familiar with
originals or copies, certified or otherwise, of such documents and records of
the Company and such statutes, regulations and other instruments as we have
deemed necessary or advisable for the purposes of this opinion, including (i)
the Registration Statement, (ii) the Restated Articles of Incorporation of the
Company, as filed with the Secretary of State of the State of Texas and (iii)
the Bylaws of the Company.
We have assumed that all signatures on all documents presented to us are
genuine, that all documents submitted to us as originals are accurate and
complete, that all documents submitted to us as copies are true and correct
copies of the originals thereof, that all information submitted to us was
accurate and complete and that all persons executing and delivering originals or
copies of documents examined by us were competent to execute and deliver such
documents.
Based on the foregoing and having due regard for legal considerations we
deem relevant, we are of the opinion that the Shares, when sold as described in
the Registration Statement, will be legally issued, fully paid and
nonassessable.
This opinion is limited in all respects to the laws of the State of Texas
and the United States of America.
This opinion may be filed as an exhibit to the Registration Statement.
Sincerely,
JENKENS & GILCHRIST,
A Professional Corporation
By: /s/J. Rowland Cook
---------------------------------------
J. Rowland Cook
For the Corporation
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) pertaining to the Scientific Measurement Systems, Inc. 1990 Long-Term
Incentive Plan of our report dated September 15, 1995, with respect to the
consolidated financial statements of Scientific Measurement Systems, Inc.
included in the Form 10-KSB for the year ended July 31, 1995, as previously
filed with the Securities and Exchange Commission.
BDO Seidman, LLP
Austin, Texas
May 8, 1996
