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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13G
Under the Securities Exchange Act of 1934
(Amendment No. ______________)*
Nanophase Technologies Corporation
----------------------------------
(Name of Issuer)
Common Stock
------------------------------
(Title of Class of Securities)
6300791
--------------
(CUSIP Number)
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 2 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Venture Fund II, L.P. |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Delaware |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 705,835 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 705,835 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 705,835 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.7% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | CO |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 3 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Management Partners II, L.P. |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Delaware |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 719,869 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 719,869 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 719,869 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.9% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | PN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 4 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Venture Partners, L.P. |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Delaware |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 719,869 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 719,869 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 719,869 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.9% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | PN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 5 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Venture Corporation |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Delaware |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 719,869 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 719,869 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 719,869 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.9% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | CO |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 6 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Venture Fund, L.P. |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Delaware |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 768,088 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 768,088 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 768,088 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 6.1% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | PN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 7 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | ARCH Development Corporation |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | Illinois |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 768,088 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 768,088 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 768,088 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 6.1% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | CO |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 8 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | Steven Lazarus |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | USA |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 1,487,957 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 1,487,957 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 1,487,957 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 11.7% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | IN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 9 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | Keith Crandell |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | USA |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 719,869 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 719,869 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 719,869 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.9% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | IN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 10 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
|--------|---------------------------------------------------------------------|
| 1 | NAME OF REPORTING PERSON |
| | S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON |
| | |
| | Robert Nelsen |
|--------|---------------------------------------------------------------------|
| 2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] |
| | (b) [ ] |
| | |
|--------|---------------------------------------------------------------------|
| 3 | SEC USE ONLY |
| | |
|--------|---------------------------------------------------------------------|
| 4 | CITIZENSHIP OR PLACE OF ORGANIZATION |
| | |
| | USA |
|-----------------|--------|---------------------------------------------------|
| | 5 | SOLE VOTING POWER |
| | | 0 |
| NUMBER OF |--------|---------------------------------------------------|
| SHARES | 6 | SHARED VOTING POWER |
| BENEFICIALLY | | 719,869 |
| OWNED BY |--------|---------------------------------------------------|
| EACH | 7 | SOLE DISPOSITIVE POWER |
| REPORTING | | 0 |
| PERSON |--------|---------------------------------------------------|
| WITH | 8 | SHARED DISPOSITIVE POWER |
| | | 719,869 |
|------------------------------------------------------------------------------|
| 9 | AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
| | |
| | 719,869 |
|--------|---------------------------------------------------------------------|
| 10 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (9) EXCLUDES CERTAIN [ ] |
| | SHARES* |
| | |
|--------|---------------------------------------------------------------------|
| 11 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (9) |
| | 5.9% |
|--------|---------------------------------------------------------------------|
| 12 | TYPE OF REPORTING PERSON* |
| | IN |
- --------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 11 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
Item 1(a). Name of Issuer: Nanophase Technologies Corp. (the "Issuer").
Item 1(b). Address of Issuer's Principal Executive Offices: 453 Commerce
Street, Burr Ridge, Illinois 60521.
Item 2(a). Names of Persons Filing: ARCH Venture Fund, L.P. ("ARCH Venture
Fund"); ARCH Development Corporation ("ARCH Development
Corporation"); ARCH Venture Fund II, L.P. ("ARCH Venture Fund II");
ARCH Management Partners II, L.P. ("ARCH Management Partners II");
ARCH Venture Partners, L.P. ("ARCH Venture Partners"); ARCH Venture
Corporation ("ARCH Venture Corporation"); Steven Lazarus, Keith
Crandell and Robert Nelsen (collectively, the "Managing Directors").
ARCH Venture Fund, ARCH Development Corporation, ARCH Venture Fund
II, ARCH Management Partners II, ARCH Venture Partners, ARCH Venture
Corporation and the Managing Directors collectively are referred to
as the "Reporting Persons."
Item 2(b). Address of Principal Business Office: The principal business address
of the Reporting Persons is 8735 W. Higgins Road, Suite 235,
Chicago, IL 60631.
Item 2(c). Citizenship: ARCH Venture Fund, L.P., ARCH Venture Fund II, ARCH
Management Partners II and ARCH Venture Partners are limited
partnerships organized under the laws of the State of Delaware. ARCH
Venture Corporation is a corporation organized under the laws of the
State of Delaware. ARCH Development Corporation is a corporation
organized under the laws of the State of Illinois. Each Managing
Director is a US citizen.
Item 2(d). Title of Class of Securities: Common Stock, $.01 (the "Common
Stock").
Item 2(e). CUSIP Number: 630079101.
Item 3. If this statement is filed pursuant to Rules 13d-1(b), or 13d-2(b),
-------------------------------------------------------------------
check whether the person filing is a:
------------------------------------
(a) [ ] Broker or Dealer registered under Section 15 of
the Securities Exchange Act of 1934 (the "Act").
(b) [ ] Bank as defined in Section 3(a)(6) of the Act.
(c) [ ] Insurance Company as defined in Section
3(a)(19) of the Act.
(d) [ ] Investment Company registered under Section 8
of the Investment Company Act of 1940.
(e) [ ] Investment Adviser registered under Section 203
of the Investment Advisers Act of 1940.
(f) [ ] Employee Benefit Plan, Pension Fund which is
subject to the provisions of the Employee
Retirement Income Security Act of 1974 or Endowment
Fund; see Rule 13d-1(b)(1)(ii)(F) of the Act.
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 12 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
(g) [ ] Parent Holding Company, in accordance with Rule
13d-1(b)(ii)(G) of the Act.
(h) [ ] Group, in accordance with Rule 13d-1(b)(1)(ii)(H)
of the Act.
Not Applicable.
Item 4. Ownership:
---------
(a) Amount Beneficially Owned: As of December 31, 1997: ARCH
Venture Fund II is the record owner of 705,835 shares of
Common Stock; ARCH II Parallel Fund is the record owner of
14,034 shares of Common Stock; and ARCH Venture Fund is
the record owner of 366,550 shares of Common Stock and a
presently exercisable warrant (the "Warrant") to purchase
up to an aggregate of 401,538 shares of Common Stock.
ARCH Management Partners II is the sole general partner of
ARCH Venture Fund II and ARCH II Parallel Fund. ARCH
Venture Partners is the sole general partner of ARCH
Management Partners II. ARCH Venture Corporation is the
sole general partner of ARCH Venture Partners. Each of
ARCH Management Partners II, ARCH Venture Partners and
ARCH Venture Corporation may be deemed to beneficially own
an aggregate of 719,869 shares of Common Stock held by
ARCH Venture Fund II and ARCH II Parallel Fund. The
Managing Directors are the managing directors of ARCH
Venture Corporation and may be deemed to beneficially own
the shares of Common Stock held by ARCH Venture Fund II
and ARCH II Parallel Fund. The Managing Directors disclaim
beneficial ownership with respect to these shares.
ARCH Development Corporation is the general partner of
ARCH Venture Fund and may be deemed to beneficially own
768,088 shares of Common Stock. Mr. Lazarus has been
granted power of attorney to act in the name of and for
ARCH Development Corporation with respect to the role of
ARCH Development Corporation as general partner of ARCH
Venture Fund and therefore may be deemed to beneficially
own the securities held by ARCH Venture Fund. Mr. Lazarus
disclaims beneficial ownership of these shares.
(b) Percent of Class: ARCH Venture Fund, 6.1%; ARCH
Development Corporation, 6.1%; ARCH Venture Fund II, 5.7%;
ARCH Management Partners II, 5.9%; ARCH Venture Partners,
5.9%; ARCH Venture Corporation, 5.9%; Steven Lazarus,
11.7%; Keith Crandell, 5.9%; and Robert Nelsen, 5.9%. The
foregoing percentages are calculated based on the
12,277,454 shares of Common Stock reported in the Issuer's
Prospectus dated November 26, 1997 to be outstanding after
the Issuer's Initial Public Offering.
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 13 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
(c) Number of Shares as to Which Such Person Has:
--------------------------------------------
(i) Sole power to vote or to direct the vote: ARCH Venture
Fund, 0; ARCH Development Corporation, 0; ARCH Venture
Fund II, 0; ARCH Management Partners II, 0; ARCH Venture
Partners, 0; ARCH Venture Corporation, 0; Steven Lazarus,
0; Keith Crandell, 0; and Robert Nelsen, 0.
(ii) Shared power to vote or to direct the vote: ARCH
Venture Fund, 768,088; ARCH Development Corporation,
768,088; ARCH Venture Fund II, 705,835; ARCH Management
Partners II, 719,869; ARCH Venture Partners, 719,869; ARCH
Venture Corporation, 719,869; Steven Lazarus, 1,487,957;
Keith Crandell, 719,869; and Robert Nelsen, 719,869.
(iii) Sole power to dispose or to direct the disposition
of: ARCH Venture Fund, 0; ARCH Development Corporation, 0;
ARCH Venture Fund II, 0; ARCH Management Partners II, 0;
ARCH Venture Partners, 0; ARCH Venture Corporation, 0;
Steven Lazarus, 0; Keith Crandell, 0; and Robert Nelsen,
0.
(iv) Shared power to dispose or to direct the disposition
of: ARCH Venture Fund, 768,088; ARCH Development
Corporation, 768,088; ARCH Venture Fund II, 705,835; ARCH
Management Partners II, 719,869; ARCH Venture Partners,
719,869; ARCH Venture Corporation, 719,869; Steven
Lazarus, 1,487,957; Keith Crandell, 719,869; and Robert
Nelsen, 719,869.
Item 5. Ownership of Five Percent or Less of a Class:
--------------------------------------------
Not Applicable.
Item 6. Ownership of More than Five Percent on Behalf of Another Person:
---------------------------------------------------------------
Not Applicable.
Item 7. Identification and Classification of the Subsidiary Which
---------------------------------------------------------
Acquired the Security Being Reported on By the Parent Holding
-------------------------------------------------------------
Company:
-------
Not Applicable.
Item 8. Identification and Classification of Members of the Group:
---------------------------------------------------------
ARCH Venture Fund II, ARCH II Parallel Fund, ARCH Management
Partners II, ARCH Venture Partners, ARCH Venture Corporation, the
Managing Directors, ARCH Venture Fund, and ARCH Development
Corporation expressly disclaim membership in a "group" as defined
in Rule 13d-5(b)(1).
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 14 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
Item 9. Notice of Dissolution of Group:
------------------------------
Not Applicable.
Item 10. Certification:
-------------
Not Applicable. This statement on Schedule 13G is not filed
pursuant to Rule 13d-1(b).
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 15 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
SIGNATURE
---------
After reasonable inquiry and to the best of its knowledge and belief,
each of the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: February 12, 1998 ARCH VENTURE FUND II, L.P.
By: ARCH Management Partners II, L.P.
its General Partner
By: ARCH Venture Partners, L.P.
its General Partner
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Managing Director
ARCH MANAGEMENT PARTNERS II, L.P.
By: ARCH Venture Partners, L.P.
its General Partner
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Managing Director
ARCH VENTURE PARTNERS, L.P.
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Managing Director
ARCH VENTURE CORPORATION
By: /s/ Steven Lazarus
------------------
Managing Director
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 16 of 18 Pages |
| ----------- | | --- --- |
- ------------------------- ---------------------------
ARCH VENTURE FUND, L.P.
By: ARCH Development Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Steven Lazarus
Its: Agent and Attorney In Fact
ARCH DEVELOPMENT CORPORATION
By: /s/ Steven Lazarus
------------------
Steven Lazarus
Its: Agent and Attorney In Fact
/s/ Steven Lazarus
------------------
Steven Lazarus
/s/ Keith Crandell
------------------
Keith Crandell
/s/ Robert Nelsen
------------------
Robert Nelsen
<PAGE>
- ------------------------- ---------------------------
|CUSIP NO. 6300791 | 13G | Page 17 of 18 Pages |
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Exhibit 1
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AGREEMENT
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Pursuant to Rule 13d-1-(f)(1) under the Securities Exchange Act of 1934,
the undersigned hereby agree that only one statement containing the information
required by Schedule 13G need be filed with respect to the ownership by each of
the undersigned of shares of stock of Nanophase Technologies Corporation.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original.
Dated: February 12, 1998 ARCH VENTURE FUND II, L.P.
By: ARCH Management Partners II, L.P.
its General Partner
By: ARCH Venture Partners, L.P.
its General Partner
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
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Managing Director
ARCH MANAGEMENT PARTNERS II, L.P.
By: ARCH Venture Partners, L.P.
its General Partner
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Managing Director
ARCH VENTURE PARTNERS, L.P.
By: ARCH Venture Corporation
its General Partner
By: /s/ Steven Lazarus
------------------
Managing Director
ARCH VENTURE CORPORATION
By: /s/ Steven Lazarus
------------------
Managing Director
<PAGE>
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|CUSIP NO. 6300791 | 13G | Page 18 of 18 Pages |
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ARCH VENTURE FUND, L.P.
By: ARCH Development Corporation
its General Partner
By: /s/ Steven Lazarus
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Steven Lazarus
Its: Agent and Attorney In Fact
ARCH DEVELOPMENT CORPORATION
By: /s/ Steven Lazarus
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Steven Lazarus
Its: Agent and Attorney In Fact
/s/ Steven Lazarus
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Steven Lazarus
/s/ Keith Crandell
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Keith Crandell
/s/ Robert Nelsen
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Robert Nelsen
