As filed with the Securities and Exchange Commission on October 25, 1996
Registration No. 33-95262
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
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Amendment No. 1
To
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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SHEFFIELD MEDICAL TECHNOLOGIES INC.
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(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 13-3808303
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
30 ROCKEFELLER PLAZA, SUITE 4515
NEW YORK, NEW YORK 10112
(Address of principal executive offices) (Zip Code)
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OPTIONS GRANTED PURSUANT TO THE REGISTRANT'S 1993 STOCK OPTION PLAN
OPTIONS GRANTED PURSUANT TO THE REGISTRANT'S 1993 RESTRICTED STOCK PLAN
OPTIONS GRANTED TO DIRECTORS, OFFICERS, EMPLOYEES, CONSULTANTS
AND ADVISORS OF THE COMPANY PURSUANT TO OTHER EMPLOYEE BENEFIT PLANS
OF THE REGISTRANT
(Full Title of the Plan)
--------------------
DOUGLAS R. EGER
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
SHEFFIELD MEDICAL TECHNOLOGIES INC.
30 ROCKEFELLER PLAZA
NEW YORK, NEW YORK 10112
(Name and Address of agent for service)
(212) 957-6600
(Telephone number, including area code, of agent for service)
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WITH A COPY TO:
DANIEL J. GALLAGHER, ESQ.
OLSHAN GRUNDMAN FROME & ROSENZWEIG LLP
505 PARK AVENUE
NEW YORK, NEW YORK 10022
(212) 753-7200
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=====================================================================================================================
Proposed Proposed
maximum maximum
Title of Amount offering aggregate Amount of
securities to be price offering registration
to be registered registered per share price fee*
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<S> <C> <C> <C> <C>
Common Stock, $.01 500,000shares
par value per share (1)(2) $ 4.7669(1) $2,383,438(1) $ 822.00
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Common Stock, $.01
par value per share 7,500shares $ 4.00 $ 30,000 $ 11.00
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Common Stock, $.01
par value per share 3,000shares $ 3.875 $ 11,625 $ 4.00
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Common Stock, $.01
par value per share 15,000shares $ 3.50 $ 52,500 $ 19.00
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Common Stock, $.01
par value per share 25,000shares $ 4.25 $ 106,250 $ 37.00
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Common Stock, $.01
par value per share 25,000shares $ 3.75 $ 93,750 $ 34.00
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Common Stock, $.01 150,000shares
par value per share (3) $ 4.875(3) $ 731,250(3) $ 253.00
- ---------------------------------------------------------------------------------------------------------------------
Common Stock, $.01 255,500shares
par value per share (4) $ 2.60(4) $ 664,300(4) $ 230.00
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Common Stock, $.01
par value per share 200,000shares $ 3.50 $ 700,000 $ 242.00
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Common Stock, $.01
par value per share 250,000shares $ 1.90 $ 475,000 $ 164.00
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Common stock, $.01 165,000shares
par value per share (5) $ .7372(5) $ 121,638(5) $ 42.00
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Common stock, $.01
par value per share 50,000shares $ 2.25 $ 112,500 $ 39.00
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Common stock, $.01
par value per share 37,500shares $ 3.00 $ 112,500 $ 39.00
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Common Stock, $.01
par value per share 50,000shares $ 3.25 $ 162,500 $ 57.00
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Common Stock, $.01
par value per share 200,000shares $ 3.75 $ 750,000 $ 259.00
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Common Stock, $.01
par value per share 80,000shares $ 4.00 $ 320,000 $ 111.00
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Common Stock, $.01
par value per share 25,000shares $ 4.50 $ 112,500 $ 39.00
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Common Stock, $.01
par value per share 25,000shares $ 5.00 $ 125,000 $ 44.00
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Common Stock, $.01
par value per share 12,000shares $ 5.125 $ 61,500 $ 22.00
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Common Stock, $.01
par value per share 25,000shares $ 5.50 $ 137,500 $ 48.00
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Common Stock, $.01
par value per share 25,000shares $ 6.00 $ 150,000 $ 52.00
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Common Stock, $.01
par value per share 25,000shares $ 6.50 $ 162,500 $ 57.00
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Common Stock, $.01
par value per share 2,500shares $ 4.125 $ 10,313 $ 4.00
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Common Stock, $.01
par value per share 10,000shares $ 8.25 $ 82,500 $ 29.00
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Common Stock, $.01
par value per share 25,000shares $ 4.125 $ 103,125 $ 36.00
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Common Stock, $.01
par value per share 15,000shares $ 4.25 $ 63,750 $ 22.00
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Common Stock, $.01
par value per share 15,000shares $ 6.00 $ 90,000 $ 32.00
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Common Stock, $.01
par value per share 80,000shares $ 4.00 $ 320,000 $ 111.00
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Common Stock, $.01
par value per share 20,000shares $ 5.063 $ 101,260 $ 35.00
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Common Stock, $.01
par value per share 50,000shares $ 4.875 $ 243,750 $ 85.00
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Common Stock, $.01
par value per share 50,000shares $ 4.063 $ 203,150 $ 71.00
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Common Stock, $.01
par value per share 5,000shares $ 4.00 $ 20,000 $ 7.00
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Total 2,423,000 shares $8,794,099 $ 3,057.00(6)
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</TABLE>
(1) Represents shares of Common Stock issuable upon exercise of options
granted under the Company's 1993 Stock Option Plan. Includes 250,000
shares with respect to which options have been granted at an exercise
price of $4.625 per share and 45,000 shares with respect to which
options have been granted at an exercise price of $5.0625 per share. An
additional 205,000 shares of Common Stock are to be offered at prices
not presently determined. Pursuant to Rule 457(g) and (h), the offering
price for these additional shares is estimated solely for the purpose
of determining the registration fee and is based on $4.875, the average
of the high and low sales prices of the Common Stock on the American
Stock Exchange on July 24, 1995.
(2) Pursuant to Rule 416, there are also registered hereby an indeterminate
number of shares of Common Stock that may become issuable by reason of
the anti-dilution provisions of the Company's 1993 Stock Option Plan.
(3) Represents shares of Common Stock issuable under the Company's 1993
Restricted Stock Plan. No shares have been issued under the Company's
1993 Restricted Stock Plan. Pursuant to Rule 457(g) and (h), the
offering price for the shares of Common Stock issuable under the
Company's 1993 Restricted Stock Plan is estimated solely for the
purpose of determining the registration fee and is based on $4.875, the
average of the high and low sales prices of the Common Stock on the
American Stock Exchange on July 24, 1995.
(4) Represents Common Stock issuable upon the exercise of options with a
Canadian $3.52 per share exercise price. The registration fee is based
upon a conversion price of US $.7372 per Canadian $1.00 as of July 24,
1995 as reported in the Wall Street Journal on July 25, 1995.
(5) Represents Common Stock issuable upon the exercise of options with a
Canadian $1.00 per share exercise price. The registration fee is based
upon a conversion price of US $.7372 per Canadian $1.00 as of July 24,
1995 as reported in the Wall Street Journal on July 25, 1995.
(6) The Registrant previously paid a registration fee of $3,057.00 on July
31, 1995.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED OCTOBER 25, 1996
PROSPECTUS
967,498 SHARES
SHEFFIELD MEDICAL TECHNOLOGIES INC.
Common Stock ($.01 par value per share)
This Prospectus relates to the reoffer and resale by certain selling
stockholders (the "Selling Stockholders"), some of whom may be deemed to be
"affiliates" as defined in Rule 405 of the Securities Act of 1933, as amended
(the "Securities Act"), of shares (the "Shares") constituting a portion of the
Common Stock, $.01 par value (the "Common Stock"), of Sheffield Medical
Technologies Inc. (the "Company") that may be issued by the Company to the
Selling Stockholders upon the exercise of outstanding stock options granted
pursuant to certain employee benefit plans (the "Plans") of the Company. The
Shares are being reoffered and resold for the account of the Selling
Stockholders and the Company will not receive any of the proceeds from the
resale of the Shares. With respect to the Shares that may be issued to the
Selling Stockholders or additional affiliates under the Plans, this Prospectus
also relates to certain Shares underlying options which have not as of this date
been granted. If and when such options are granted, the Company will distribute
a Prospectus Supplement as required by the Act.
The offer and sale of the Shares to the Selling Stockholders were
previously registered under the Securities Act. The Shares are being reoffered
and resold for the accounts of the Selling Stockholders and the Company will not
receive any of the proceeds from the resale of the Shares.
The Selling Stockholders have advised the Company that the resale of
their Shares may be effected from time to time in one or more transactions on
the American Stock Exchange (the "AMEX"), in negotiated transactions or
otherwise at market prices prevailing at the time of the sale or at prices
otherwise negotiated. See "Plan of Distribution." The Company will bear all
expenses in connection with the preparation of this Prospectus.
AN INVESTMENT IN THE COMMON STOCK OFFERED HEREBY INVOLVES A HIGH DEGREE
OF RISK. SEE "RISK FACTORS" AT PAGE 4 HEREOF.
The Common Stock of the Company is traded on the AMEX under the symbol
"SHM." On October 23, 1996, the closing sale price for the Common Stock, as
reported by AMEX, was $3.875.
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 , 1996.
<PAGE>
TABLE OF CONTENTS
AVAILABLE INFORMATION.........................................2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...............2
RISK FACTORS..................................................4
THE COMPANY...................................................9
USE OF PROCEEDS..............................................11
SELLING STOCKHOLDERS.........................................12
PLAN OF DISTRIBUTION.........................................13
LEGAL MATTERS................................................13
EXPERTS......................................................13
ADDITIONAL INFORMATION.......................................14
----------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the following Regional Offices of
the Commission: New York Regional Office, Seven World Trade Center, Suite 1300,
New York, New York 10048 and Chicago Regional Office, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained
from the Public Reference Section of the Commission at Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such material
may also be accessed electronically by means of the Commission's home page on
the internet at http://www.sec.gov. The Common Stock of the Company is traded on
the AMEX under the symbol "SHM." Reports and other information concerning the
Company can be inspected at the offices of the AMEX, 86 Trinity Place, New York,
New York 10006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference the following documents
heretofore filed with the Commission pursuant to the Exchange Act:
(a) Annual Report of the Company on Form 10-KSB for the fiscal
year ended December 31, 1995.
(b) Quarterly Report of the Company on Form 10-QSB for the
fiscal quarter ended June 30, 1996.
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(c) The description of the Company's Common Stock, par value
$0.01 per share, and other matters set forth in the Company's
Registration Statement on Form 8-B filed on July 7, 1995 and any
amendment or report filed for the purpose of updating such description.
All reports and other documents filed by the Company after the date of
this Prospectus pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act, prior to the termination of this offering, are deemed to be incorporated by
reference in this Prospectus and shall be deemed to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein (or in any other subsequently filed document which is also
incorporated by reference in this Prospectus) modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person
to whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, a copy of any or all of the documents referred to
above which have been or may be incorporated in this Prospectus by reference,
other than exhibits to such documents. Written requests for such copies should
be directed to Sheffield Medical Technologies Inc., 30 Rockefeller Plaza, Suite
4515, New York, New York 10112, Attention: Douglas R. Eger, Chairman and Chief
Executive Officer. Oral requests should be directed to Mr. Eger at (212)
957-6600.
The Company's principal offices are located at 30 Rockefeller Plaza,
Suite 4515, New York, New York 10112, and its telephone number is (212)
957-6600.
---------------------------
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offer made hereby, and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or any Selling Stockholder. This Prospectus does not constitute
an offer to sell, or a solicitation of an offer to buy, the securities offered
hereby to any person in any state or other jurisdiction in which such offer or
solicitation is unlawful. The delivery of this Prospectus at any time does not
imply that information contained herein is correct as of any time subsequent to
its date.
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RISK FACTORS
THE SECURITIES OFFERED HEREBY ARE HIGHLY SPECULATIVE AND PROSPECTIVE
PURCHASERS SHOULD BE AWARE THAT THE PURCHASE OF SUCH SECURITIES INVOLVES A HIGH
DEGREE OF RISK. IN ADDITION TO OTHER INFORMATION IN THIS PROSPECTUS, THE
FOLLOWING FACTORS SHOULD BE CONSIDERED CAREFULLY IN EVALUATING THE COMPANY
BEFORE PURCHASING THE SECURITIES 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.
DEVELOPMENT STAGE COMPANY; HISTORY OF OPERATING LOSSES AND ACCUMULATED
DEFICIT; GOING CONCERN OPINION
The Company is in the development stage. The Company commenced
operations in the United States in January 1992 through its wholly-owned
subsidiary, U-Tech Medical Corporation ("U-Tech"), a Texas corporation, to
acquire, develop and commercialize what it believed to be promising medical
technologies. The Company has been principally engaged to date in research
funding and licensing efforts, has experienced significant operating losses and,
as of June 30, 1996, had an accumulated deficit of $22,893,373. The independent
auditors' report dated February 28, 1996, except for Note 10 as to which the
date is April 10, 1996, on the Company's consolidated financial statements
stated that the Company has not generated any operating revenue, has incurred
operating losses and requires additional capital, which conditions raise
substantial doubt about its ability to continue as a going concern. The Company
expects that it will continue to have a high level of operating expenses and
will be required to make significant up-front expenditures in connection with
sponsored research agreements with independent companies, universities and other
institutions ("Sponsored Research Agreements") for research and development and
product development activities. As a result, the Company anticipates significant
additional operating losses for 1996 and that losses will continue thereafter
until such time, if ever, as the Company is able to generate sufficient revenues
to sustain its operations.
The Company's ability to achieve profitable operations is dependent in
large part on regulatory approvals of its products and technologies and on its
ability to enter into manufacturing and marketing agreements with other
pharmaceutical, biomedical or medical companies. There can be no assurance that
the Company will ever achieve profitable operations.
SIGNIFICANT LIQUIDITY RESTRAINTS
The Company's cash available for funding its operations as of June 30,
1996 was $5,158,751. As of such date, the Company had trade payables and accrued
liabilities of $247,669, current Sponsored Research Agreement funding
obligations of approximately $415,000 and other current liabilities of $124,422.
In addition, the Company is obligated to fund between such date and December 31,
1996 approximately $1,050,000 in the aggregate under existing Sponsored Research
Agreements. The Company will be required to obtain additional funds for its
business through operations or equity or debt financings, collaborative
arrangements with corporate partners or from other sources. No assurance can be
given that these funds will be available for the Company to finance its
development on acceptable terms, if at all. If adequate funds are not available
from operations or additional sources of funding, the Company's business will
suffer a material adverse effect.
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<PAGE>
NEED FOR ADDITIONAL FINANCING
Since the Company does not expect to generate substantial revenues from
the sale of any products or technologies in the immediate future, the Company
will require substantial additional funds from other sources to complete its
research and development, to conduct additional clinical tests and to establish
manufacturing and marketing relationships with pharmaceutical, biomedical or
medical companies. The Company will attempt to acquire funds for these purposes
through additional equity or debt financings, collaborative arrangements with
corporate partners or from other sources. No assurance can be given that these
funds will be available for the Company to finance its development on acceptable
terms, if at all. If adequate funds are not available from operations or
additional sources of funding, the Company's business will suffer a material
adverse effect.
LONG TERM DEVELOPMENT OF TECHNOLOGIES; NO COMMERCIALIZATION OF PRODUCTS TO DATE
The Company has not yet begun to market products or generate revenues
from the sale of products or technologies. The Company is funding research that
began, in some cases, many years before the Company acquired rights in such
projects. The Company's products and technologies will require significant
additional development, laboratory and clinical testing and investment prior to
commercialization. The Company does not expect regulatory approval for
commercial sales of any of its products or technologies in the immediate future.
There can be no assurance that such products or technologies will be
successfully developed, proved to be safe and efficacious in clinical trials,
meet applicable regulatory standards, obtain required regulatory approvals, be
capable of being produced in commercial quantities at reasonable costs or be
successfully commercialized and marketed.
ROYALTY PAYMENT OBLIGATIONS
The owners and licensors of the technology rights acquired by the
Company are entitled to receive up to 50% of all royalties and payments in lieu
of royalties received by the Company from commercialization as their royalty
interest. Accordingly, in addition to its substantial investment in research and
development of technologies, the Company will be required to make substantial
payments to others in connection with revenues derived from commercialization of
products, if any.
POTENTIAL LOSS OF RIGHTS UPON DEFAULT
Under the terms of Sponsored Research Agreements, the Company is
obligated to make periodic installments to finance research and development
activities according to specified budgets. In the event that the Company
defaults in the payment of an installment under the terms of a Sponsored
Research Agreement, its rights thereunder could be forfeited. As a consequence,
the Company could lose all rights under a Sponsored Research Agreement to the
related licensed technology, notwithstanding the total investment made through
the date of the default. There can be no assurance that unforeseen obligations
or contingencies will not deplete the Company's financial resources and,
accordingly, the Company's resources may not be available to fulfill the
Company's commitments.
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<PAGE>
DEPENDENCE ON PRINCIPAL INVESTIGATORS
The Company is dependent upon the active participation of its principal
investigators in the advancement of the research and development associated with
their related projects. The loss of a principal investigator, particularly in
the early stages of the development of a technology, could have a material
adverse effect on the related project and the Company's prospects.
RAPID TECHNOLOGICAL CHANGE; COMPETITION
The medical research field is subject to rapid technological change and
innovation. Human immunodeficiency virus ("HIV") and Acquired Immune Deficiency
Syndrome ("AIDS") research, prostate cancer research, anti-proliferative
research and product development, the areas in which the Company is presently
engaged, are rapidly evolving fields in which developments are expected to
continue at a rapid pace. In particular, HIV/AIDS research is proceeding on a
wide-scale at numerous prestigious scientific research institutions and
commercial ventures. Reports of progress and potential breakthroughs are
occurring at an increasing speed. There can be no assurance that the Company has
a competitive advantage in the field of HIV/AIDS research or in any of the other
fields in which the Company may concentrate its efforts.
The Company's success will depend upon its ability to develop and
maintain a competitive position in the research, development and
commercialization of products and technologies in its areas of focus.
Competition from pharmaceutical, chemical, biomedical and medical companies,
universities, research and other institutions is intense and is expected to
increase. All, or substantially all, of these competitors have substantially
greater research and development capabilities, experience, and manufacturing,
marketing, financial and managerial resources. Further, acquisitions of
competing companies by large pharmaceutical or other companies could enhance
such competitors' financial, marketing and other capabilities. There can be no
assurance that developments by others will not render the Company's products or
technologies obsolete or not commercially viable or that the Company will be
able to keep pace with technological developments.
GOVERNMENT REGULATION
The Company's ongoing research and development projects are subject to
rigorous U.S. Food and Drug Administration ("FDA") approval procedures. The
preclinical and clinical testing requirements to demonstrate safety and efficacy
in each clinical indication (the specific condition intended to be treated) and
regulatory approval processes of the FDA can take a number of years and will
require the expenditure of substantial resources by the Company. Delays in
obtaining FDA approval would adversely affect the marketing of products to which
the Company has rights and the Company's ability to receive product revenues or
royalties. Moreover, even if FDA approval is obtained, a marketed product, its
manufacturer and its manufacturing facilities are subject to continual review
and periodic inspections by the FDA, and a later discovery of previously unknown
problems with a product, manufacturer or facility may result in restrictions on
such product or manufacturer. Failure to comply with the applicable regulatory
requirements can, among other things, result in fines, suspensions of regulatory
approvals, product recalls, operating restrictions and criminal prosecution.
Additional government regulation may be established which could prevent or delay
regulatory approval of the Company's products. Sales of
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<PAGE>
pharmaceutical products outside the United States are subject to foreign
regulatory requirements that vary widely from country to country. Even if FDA
approval has been obtained, approval of a product by comparable regulatory
authorities of foreign countries must be obtained prior to the commencement of
marketing the product in those countries. The time required to obtain such
approval may be longer or shorter than that required for FDA approval. The
Company has no experience in manufacturing or marketing in foreign countries nor
in matters such as currency regulations, import-export controls or other trade
laws.
RISKS INCIDENT TO PATENT APPLICATIONS AND RIGHTS
The Company's success will depend in part on its ability to obtain
patent protection for products and processes and to maintain trade secret
protection and operate without infringing the proprietary rights of others. The
degree of patent protection to be afforded to pharmaceutical, biomedical or
medical inventions is an uncertain area of the law. There can be no assurance
that the Company will develop or receive sublicenses or other rights related to
proprietary technology which are patentable, that any patents pending will
issue, or that any issued patents will provide the Company with any competitive
advantages or will not be challenged by third parties. Furthermore, there can be
no assurance that others will not independently duplicate or develop similar
technologies to those developed by or licensed to the Company.
The Company supports and collaborates in research conducted at
universities and other institutions. There can be no assurance that the Company
will have or be able to acquire exclusive rights to inventions or technical
information derived from such collaborations or that disputes will not arise as
to such exclusive rights or any derivative or related research programs. If the
Company is required to defend against charges of patent infringement or to
protect its own proprietary rights against third parties, substantial costs will
be incurred and the Company could lose rights to certain products and
technologies.
RELIANCE ON THIRD PARTIES; NO MARKETING OR MANUFACTURING CAPABILITIES
The Company does not intend to manufacture or market its products. The
Company will attempt to enter into manufacturing and marketing agreements with
one or more established pharmaceutical, biomedical and medical companies for any
products that are developed. There can be no assurance that other
pharmaceutical, biomedical or medical companies will be interested in the
Company's products or technologies or be willing to enter into manufacturing or
marketing agreements on terms acceptable to the Company. Further, there can be
no assurance that pharmaceutical, biomedical or other medical companies will
succeed in manufacturing and marketing the Company's products or technologies or
that the Company will derive revenues from its products or technologies.
DEPENDENCE UPON OBTAINING HEALTHCARE REIMBURSEMENT
The Company's ability to commercialize human therapeutic and diagnostic
products may indirectly depend in part on the extent to which costs for such
products and technologies are reimbursed by private health insurance or
government health programs. The uncertainty regarding reimbursement may be
especially significant in the case of newly approved products. There can be no
assurance that price levels will be sufficient to provide a return to the
Company on its investment in new products and technologies.
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<PAGE>
ADEQUACY OF PRODUCT LIABILITY INSURANCE
The use of the Company's proposed products and processes during
testing, and after approval, may entail inherent risks of adverse effects which
could expose the Company to product liability claims. Product liability claims
could have a material adverse effect on the business and financial condition of
the Company. The Company has obtained, and will require its licensees to obtain,
product liability insurance at an appropriate stage of product development and
commercialization. There can be no assurance that the Company and its licensees
will be able to maintain or obtain adequate product liability insurance on
acceptable terms or that such insurance will provide adequate coverage against
all potential claims.
VOLATILITY OF MARKET PRICE OF SECURITIES
The market price of securities of firms in the biotechnology industry
has tended to be volatile. Announcements of technological innovations by the
Company or its competitors, developments concerning proprietary rights and
concerns about safety and other factors may have a material adverse effect on
the Company's business. The market price of the Common Stock may be
significantly affected by announcements of developments in the medical field
generally or the Company's research areas specifically. The stock market has
experienced volatility in market prices of companies similar to the Company that
has often been unrelated to the operating results of such companies. This
volatility may have a material adverse effect the market price of the Common
Stock.
OUTSTANDING OPTIONS AND WARRANTS
As of September 30, 1996, the Company had reserved approximately
2,773,333 shares of Common Stock for issuance upon exercise of outstanding
options and warrants, including shares of Common Stock issuable upon the
exercise of options and warrants held by officers and directors of the Company.
The Company has filed registration statements with the Commission covering the
resale of substantially all of the shares of Common Stock underlying such
options and warrants (to the extent that such shares are not registered under
the registration statement of which this Prospectus constitutes a part).
The exercise of options and outstanding warrants and sales of Common
Stock issuable thereunder could have a significant depressive effect on the
market price of shares of Common Stock and could materially impair the Company's
ability to raise capital through the sale of its equity securities.
NO DIVIDENDS
Holders of Common Stock are entitled to receive such dividends as may
be declared by the Board of Directors of the Company. To date, the Company has
not declared or paid any dividends on its Common Stock, and the Company does not
anticipate paying dividends in the foreseeable future. Rather, the Company
intends to apply any earnings to the expansion and development of its business.
AUTHORIZATION OF PREFERRED STOCK
The Company's charter authorizes the issuance of "blank check"
preferred stock with such designations, rights and preferences as may be
determined from time to time by the Board of Directors, without
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shareholder approval ("Preferred Stock"). In the event of issuance, the
Preferred Stock could be utilized, under certain circumstances, as a method of
discouraging, delaying or preventing a change in control of the Company.
Although the Company has no present intention to issue any shares of its
Preferred Stock, there can be no assurance that the Company will not do so in
the future.
THE COMPANY
The Company was organized under Canadian law in October 1986 as
Sheffield Strategic Metals, Inc. The Company commenced operations in the United
States in January 1992 through its wholly-owned subsidiary, U-Tech Medical
Corporation, a Texas corporation ("U-Tech"), with its principal offices in
Houston, Texas. Effective May 19, 1992, Sheffield Medical Technologies Inc.
became domesticated in the State of Wyoming without reincorporation pursuant to
a "continuance" procedure under Wyoming corporation law. The continuance
procedure allowed the Company to become domesticated in the United States as a
Wyoming corporation without reincorporation. On June 13, 1995, the Company
changed its state of Incorporation to Delaware by means of a merger with and
into a newly-formed wholly-owned Delaware subsidiary of the Company. Such merger
and the resulting change of the Company's state of incorporation to Delaware was
approved by the Company's stockholders in January 1995.
Unless the context otherwise indicates, the "Company" as used herein
means Sheffield Medical Technologies Inc., its predecessors and its wholly-owned
subsidiaries, Ion Pharmaceuticals, Inc. ("Ion") and U-Tech.
The Company identifies and evaluates promising pharmaceutical,
biomedical and medical technologies and selectively invests in those
technologies that the Company believes possess strong market potential. Under
Sponsored Research Agreements, the Company funds pharmaceutical, biomedical and
medical research and clinical testing in exchange for license rights to
commercialize resulting products and technologies. The Company's strategy is to
bridge the resource and management gap between late-stage research and
commercialization of any resulting products and technologies by assisting in the
management of research, development, marketing, commercialization and patent
prosecution of technologies and products. In addition, the Company manages the
preparation and submission of Investigational New Drug Notifications ("INDs")
and New Drug Applications ("NDAs") and protocols prepared for submission to the
FDA. If Company-funded research and clinical testing are successful, the Company
intends to enter into sublicense, joint venture or other collaborative
agreements with one or more pharmaceutical, biomedical or medical companies to
pursue later phase clinical testing and product manufacturing and marketing. By
utilizing third party development and distribution resources, the Company
believes that it can effectively avoid the substantial fixed costs traditionally
associated with in-house research, development, production and distribution.
The Company does not intend to manufacture or market its products.
Instead, the Company intends to finance research projects in consideration for
license rights. Thereafter, the Company will attempt to enter into manufacturing
and marketing agreements with one or more established biomedical or
pharmaceutical companies for any products which are developed.
As of the date of this Prospectus, the Company has acquired certain
development and marketing rights in the following projects:
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RBC-CD4 ELECTROINSERTION TECHNOLOGY. The Company is the worldwide
licensee of certain technology (the "RBC-CD4 Electroinsertion Technology")
relating to the electroinsertion of full-length CD4 protein into the red blood
cell membrane ("RBC-CD4") for use as a therapeutic agent in the treatment of
HIV. The electroinsertion process inserts CD4, the protein that serves as the
binding site of the HIV virus, into a red blood cell. This altered cell complex
acts as a decoy and is designed to cleanse the blood of infection by binding to
and removing the HIV virus from circulation before it can infect other cells in
the human immune system. The related research is being conducted by a team of
scientific and medical investigators affiliated with the Center for Blood
Research Laboratories, Inc. ("CBRL"), a wholly owned subsidiary of The Center
for Blood Research, Inc., an affiliate of Harvard Medical School ("Harvard") and
The Johns Hopkins University Medical Center ("Johns Hopkins").
LIPOSOME-CD4 TECHNOLOGY. The Company is the worldwide licensee of
certain technology (the "Liposome-CD4 Technology") relating to the incorporation
of CD4 antigens into liposome bilayers and their use as a therapeutic agent in
the treatment of HIV and AIDS. While RBC-CD4 Electroinsertion Technology is
being developed by the Company to target HIV and HIV-infected cells in the
blood, Liposome-CD4 Technology is being developed by the Company to target
infections in the human lymphatic system, a major reservoir for infection not
reached by blood circulation. The related research is being conducted by a team
of scientific and medical investigators affiliated with CBRL.
HIV/AIDS VACCINE. The Company holds an option to acquire a potential
HIV/AIDS vaccine (the "HIV/AIDS Vaccine") developed by Professor Jean-Claude
Chermann, one of the Pasteur Institute's original discoverers of HIV. The
vaccine concept developed by Professor Chermann utilizes a cellular antigen that
is incorporated into the HIV viral coating after the HIV virus has reproduced in
a human cell. This cellular antigen does not appear to vary across the various
strains of the virus and may provide a stable target to develop antibodies that
can prevent infection. The Company believes this approach may also protect
against both blood-borne and sexual transmission of HIV. The Company's goal is
to develop an oral formulation that would make the vaccine potentially less
costly and easier to distribute to a broad population. The related research is
being conducted by a team of scientific and medical investigators affiliated
with the French National Institute of Health and Medical Research ("INSERM").
UGIF TECHNOLOGY. The Company holds an option to acquire an exclusive
worldwide license for a growth regulator, which could serve as a potential
prostate cancer therapy. The related technology (the "UGIF Technology") focuses
on a urogenital sinus derived growth inhibitory factor that may inhibit the
growth of transformed cells and tumors in the human prostate. In addition to
treatment of prostate cancer, there may be a potential use of the UGIF
Technology or its analogues in the treatment of other diseases or conditions
dealing with abnormalities of the genitourinary system. The related research is
being conducted by scientific and medical investigators affiliated with Baylor
College of Medicine in Houston, Texas.
ANTI-PROLIFERATIVE TECHNOLOGY. The Company, through its wholly-owned
subsidiary, Ion, is the worldwide licensee of certain proprietary compounds (the
"Trifens") for anti-proliferative and anti-growth use and holds options to
acquire exclusive worldwide licenses to the uses of certain Trifens in treating
sickle cell anemia and gastrointestinal
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<PAGE>
disorders. The Trifens have demonstrated promise in therapeutic applications for
treating a number of conditions characterized by abnormal cell proliferation.
The related research is being conducted by a team of scientific and medical
investigators affiliated with Harvard and Children's Hospital of Boston,
Massachusetts.
The Shares offered for resale hereby were or will be purchased by the
Selling Stockholders upon exercise of options granted to them and will be sold
for the account of the Selling Stockholders.
USE OF PROCEEDS
The Company will receive the exercise price of the options when
exercised by the holders thereof. Such proceeds will be used for working capital
purposes by the Company. The Company will not receive any of the proceeds from
the reoffer and resale of the Shares by the Selling Stockholders.
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<PAGE>
SELLING STOCKHOLDERS
This Prospectus relates to the reoffer and resale of Shares issued or
that may be issued to the Selling Stockholders under the Plans.
The following table sets forth (i) the number of shares of Common Stock
owned by each Selling Stockholder at September 30, 1996, (ii) the number of
Shares to be offered for resale by each Selling Stockholder and (iii) the number
and percentage of shares of Common Stock to be held by each Selling Shareholder
after completion of the offering.
<TABLE>
<CAPTION>
Number of shares
Number of of Common Stock/
shares of Percentage of
Common Stock Number of Class to be Owned
Owned at Shares to be After Completion
September 30, Offered for of the
Name 1996 (1) Resale Offering(1)
- ------------------ ---------- ------- ------------
<S> <C> <C> <C>
Douglas R. Eger(2) 812,597(3) 550,000 262,597/2.2%
Anthony B. Alphin, 60,000(5) 50,000 10,000/0%
Jr.(4)
Dr. Stephen Sohn(6) 271,000(7) 50,000 221,000/1.9%
Dr. Michael Zeldin(8) 0 217,498(9) 0/0%
George Lombardi(10) 60,097(11) 100,000 0/0%
</TABLE>
- ---------------------------
* Less than 1%.
(1) Calculations assume that all options and warrants held by directors and
executive officers and exercisable within 60 days after September 30,
1996 have been exercised.
(2) Mr. Eger has served as a director of the Company since 1991 and has
served as Chief Executive Officer of the Company since February 1996.
(3) Includes 460,000 shares of Common Stock issuable upon exercise of
presently exercisable options or options exercisable within 60 days of
September 30, 1996.
(4) Mr. Alphin has served as director of the Company since 1993.
(5) Includes 50,000 shares of Common Stock issuable upon exercise of
currently exercisable options or options exercisable within 60 days of
September 30, 1996.
(6) Dr. Sohn has served as a director of the Company since 1995.
(7) Represents (i) 50,000 shares of Common Stock subject to options
exercisable within 60 days of September 30, 1996, (ii) 191,000 shares
of Common Stock subject to a warrant issued to SMT Investment
Partnership, a Massachusetts limited partnership ("SMT") and (iii)
30,000 shares of Common Stock subject to a warrant issued to The Fort
Hill Group, Inc. ("Fort Hill"). Dr. Sohn is a general partner of SMT
and a former officer of Fort Hill. Dr. Sohn disclaims beneficial
ownership of (a) any shares of Common Stock that SMT has the right to
acquire and (b) any share that Fort Hill has the right to acquire
(other than 10,000 shares issuable upon exercise of the above-mentioned
warrant issued to Fort Hill that Dr. Sohn has the right to receive upon
issuance).
(8) Dr. Zeldin has served as a director of the Company since May 1996 and
has served as an officer of the Company since March 1996.
(9) Represents shares of Common Stock issuable upon exercise of options
that are not presently exercisable and are not exercisable within 60
days of September 30, 1996.
(10) Mr. Lombardi has served as Vice President and Chief Financial Officer
of the Company since 1995.
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<PAGE>
(11) Includes 50,000 shares of Common Stock issuable upon exercise of
currently exercisable options or options exercisable within 60 days of
September 30, 1996.
PLAN OF DISTRIBUTION
It is anticipated that resale of Shares will be effected from time to
time by the Selling Stockholders in one or more transactions on the AMEX, in
negotiated transactions or otherwise at market prices prevailing at the time of
the sale or at prices otherwise negotiated. The Selling Stockholders have
advised the Company that they are not parties to any agreement, arrangement or
understanding as to such sales.
LEGAL MATTERS
Certain legal matters in connection with the issuance of the Shares
offered hereby have been passed upon for the Company by Olshan Grundman Frome &
Rosenzweig LLP, New York, New York 10022.
EXPERTS
The consolidated financial statements of Sheffield Medical Technologies
Inc. and subsidiary (a development stage enterprise) appearing in Sheffield
Medical Technologies Inc.'s Annual Report (Form 10-KSB) for the years ended
December 31, 1995 and 1994, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon (which contains an explanatory
paragraph with respect to conditions that raise substantial doubt about the
Company's ability to continue as a going concern as further described in Note 9
to the consolidated financial statements) included therein and incorporated
herein by reference. Such consolidated financial statements are, and audited
financial statements to be included in subsequently filed documents will be,
incorporated herein in reliance upon the reports of Ernst & Young LLP pertaining
to such financial statements (to the extent covered by consents filed with the
Securities and Exchange Commission) given upon the authority of such firm as
experts in accounting and auditing.
The consolidated financial statements of Sheffield Medical Technologies
Inc. and subsidiary (a development stage enterprise) as of December 31, 1993 and
for the period from October 17, 1986 (inception) to December 31, 1993 and the
years ended December 31, 1992 and 1993 have been incorporated by reference
herein and in the registration statement of which this Prospectus constitutes a
part in reliance upon the report of KPMG Peat Marwick LLP, independent certified
public accountants, incorporated by reference herein, and upon the authority of
said firm as experts in accounting and auditing.
The report of KPMG Peat Marwick LLP covering the December 31, 1993
consolidated financial statements contains an explanatory paragraph that states
that the Company's recurring losses and net deficit position raise substantial
doubt about its ability to continue as a going concern. The consolidated
financial statements do not include any adjustments that might result from the
outcome of that uncertainty.
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<PAGE>
ADDITIONAL INFORMATION
The Company has filed with the Commission a Registration Statement on
Form S-8 under the Securities Act (the "Registration Statement") with respect to
the Shares offered hereby. For further information with respect to the Company
and the securities offered hereby, reference is made to the Registration
Statement. 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 document filed as an exhibit
to the Registration Statement, each such statement being qualified in all
respects by such reference.
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<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference and made a
part hereof:
(a) Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1995;
(b) Quarterly Report on Form 10-QSB for the fiscal quarter
ended June 30, 1996.
(c) The description of the Registrant's Common Stock, par
value $0.01 per share, and other matters set forth in the Registrant's
Registration Statement on Form 8-B filed on July 7, 1995 and any
amendment or report filed for the purpose of updating such description.
All reports and other documents subsequently filed by the Registrant
pursuant to Sections 13, 14 and 15(d) of the Securities Exchange Act of 1934, as
amended, prior to the filing of a post-effective amendment which indicates that
all securities offered hereby have been sold or which deregisters all securities
remaining unsold, shall be deemed to be incorporated by reference herein and to
be a part hereof from the date of the filing of such reports and documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTEREST OF NAMED EXPERTS AND COUNSEL
Certain legal matters in connection with the issuance of the shares of
Common Stock offered hereby have been passed upon for the Registrant by Messrs.
Olshan Grundman Frome & Rosenzweig LLP, 505 Park Avenue, New York, New York
10022.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS
Except as hereinafter set forth, there is no statute, charter
provision, by-law, contract or other arrangement under which any controlling
person, director or officer of the Registrant is insured or indemnified in any
manner against liability which he may incur in his capacity as such.
Article TENTH of the Registrant's Certificate of Incorporation provides
as follows:
The Corporation shall, to the fullest extent permitted by
section 145 of the General Corporation Law of the State of Delaware, as the same
may be amended and supplemented, indemnify any and all persons whom it shall
have power to indemnify under said section from and against any and all of the
expenses, liabilities or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may
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<PAGE>
be entitled under any By-Law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
Section 5.1 of the By-laws of the Registrant provides as follows:
(a) The Corporation shall indemnify, subject to the
requirements of subsection (d) of this Section, any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation), by
reason of the fact that he is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the Corporation and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(b) The Corporation shall indemnify, subject to the
requirements of subsection (d) of this Section, any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a judgment in
its favor by reason of the fact that he is or was a director, officer, employee
or agent of the Corporation or is or was serving at the request of the
Corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the Corporation unless and only to the extent that
the Court of Chancery of the State of Delaware or the court in which such action
or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
the Court of Chancery of the State of Delaware or such other court shall deem
proper.
(c) To the extent that a director, officer, employee or agent
of the Corporation, or a person serving in any other enterprise at the request
of the Corporation, has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsection (a) and (b) of this
Section, or in defense of any claim, issue or matter therein, the Corporation
shall indemnify him against expenses
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<PAGE>
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(d) Any indemnification under subsections (a) and (b) of this
Section (unless ordered by a court) shall be made by the Corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in subsections (a) and (b)
of this Section. Such determination shall be made (1) by the Board of Directors
by a majority vote of a quorum consisting of directors who were not parties to
such action, suit or proceeding, or (2) if such a quorum is not obtainable, or,
even if obtainable a quorum of disinterested directors, or (3) by independent
legal counsel in a written opinion, or (4) by the stockholders.
(e) Expenses incurred by a director, officer, employee or
agent in defending a civil or criminal action, suit or proceeding may be paid by
the Corporation in advance of the final disposition of such action, suit or
proceeding as authorized by the Board of Directors upon receipt of an
undertaking by or on behalf of the director, officer, employee or agent to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Corporation as authorized in this Section.
(f) The indemnification and advancement of expenses provided
by or granted pursuant to, the other subsections of this Section shall not limit
the Corporation from providing any other indemnification or advancement of
expenses permitted by law nor shall it be deemed exclusive of any other rights
to which those seeking indemnification may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors or otherwise, both as
to action in his official capacity and as to action in another capacity while
holding such office.
(g) The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
Corporation, or who is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the Corporation would have the power to indemnify him against
such liability under the provisions of this Section.
(h) The indemnification and advancement of expenses provided
by, or granted pursuant to this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
(i) For the purposes of this Section, references to "the
Corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
a consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, employees or
agents, so that any person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall stand
in the same position under the provisions of this Section with
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<PAGE>
respect to the resulting or surviving corporation as he would have with respect
to such constituent corporation if its separate existence had continued.
(j) This Section 5.1 shall be construed to give the
Corporation the broadest power permissible by the Delaware General Corporation
Law, as it now stands and as heretofore amended.
Section 145 of the General Corporation Law of the State of Delaware
provides as follows:
(a) A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(b) A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of this
section, or in defense of any claim, issue or matter
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<PAGE>
therein, he shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this
section (unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in subsections (a) and (b)
of this section. Such determination shall be made (1) by the board of directors
by a majority vote of a quorum consisting of directors who were not parties to
such action, suit or proceeding, or (2) if such a quorum is not obtainable, or,
even if obtainable a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an
officer or director in defending any civil criminal administrative or
investigative action, suit or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this section. Such expenses
(including attorneys' fees) incurred by other employees and agents may be so
paid upon such terms and conditions, if any, as the board of directors deems
appropriate.
(f) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director. officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the corporation would have the power to indemnify him
against such liability under this section.
(h) For purposes of this section, references to "the
corporation" shall include, in addition to the resulting corporation, any
constituent corporation (including any constituent of a constituent) absorbed in
a consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and employees
or agents, so that any person who is or was a director, officer, employee or
agent of such constituent corporation, or is or was serving at the request of
such constituent corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
shall stand in the same position under this section with respect to the
resulting or surviving corporation as he would have with respect to such
constituent corporation if its separate existence had continued.
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<PAGE>
(i) For purposes of this section, references to "other
enterprises" shall include employee benefit plans; references to "fines" shall
include any excise taxes assessed on a person with respect to any employee
benefit plan; and references to "serving at the request of the corporation"
shall include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such director,
officer, employee, or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and in a
manner he reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner "not opposed to the best interests of the corporation" as referred to in
this section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
The Registrant has purchased a Directors and Officers Liability
Insurance policy for coverage of up to $2,000,000 effective May 3, 1995 to May
3, 1997.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
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ITEM 8. EXHIBITS
NO. DESCRIPTION REFERENCE
4.1 Form of Common Stock Certificate (1)
4.3 1993 Stock Option Plan (1)
4.4 1993 Restricted Stock Plan (1)
5 Opinion of Olshan Grundman Frome & Rosenzweig LLP (2)
with respect to the securities registered
hereunder
23.1 Consent of KPMG Peat Marwick LLP relating to the (3)
use of Financial Statements
23.2 Consent of Ernst & Young LLP relating to use of (3)
Financial Statements
23.3 Consent of Olshan Grundman Frome & Rosenzweig LLP (2)
(included in its opinion filed as Exhibit 5)
24.1 Powers of Attorney (included on the signature (3)
page to this Registration Statement)
- ------------------
(1) Incorporated by reference to the Registrant's Annual Report on Form
10-KSB for the year ended December 31, 1995 filed with the Securities
and Exchange Commission.
(2) Previously filed.
(3) Filed herewith.
ITEM 9. 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.
Notwithstanding the foregoing, an 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 and 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 20 percent change in
the maximum aggregate offering
II-7
<PAGE>
price set forth in the "Calculation of
Registration Fee" table in the effective
registration statement;
provided, however, that paragraph (i) and (ii) above
do not apply if the information required to be
included in a post-effective amendment by those
paragraphs is contained in a periodic report filed by
the registrant pursuant to Section 13 or 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; and
(3) To remove from registration by means of a
post-effective amendment any of the securities being
registered that 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 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 this 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 Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
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 a
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it
is against public policy as expressed in the Securities Act of
1933 and will be governed by the final adjudication of such
issue.
II-8
<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 New York, State of New York, on October 25, 1996.
SHEFFIELD MEDICAL TECHNOLOGIES INC.
/S/ DOUGLAS R. EGER
-----------------------------------
Douglas R. Eger,
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Douglas R. Eger and George Lombardi his
true and lawful attorney-in-fact, 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 and all amendments including post-effective
amendments to this Registration Statement, and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
said attorneys-in-fact or their substitutes, each acting alone, may lawfully do
or cause to be done by virtue thereof.
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 dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/S/ DOUGLAS R. EGER Director, Chairman, October 25, 1996
- ----------------------------------------- President and Chief
Douglas R. Eger Executive Officer
/S/ ANTHONY B. ALPHIN, JR. Director October 25, 1996
- -----------------------------------------
Anthony B. Alphin, Jr.
/S/ STEPHEN SOHN, M.D. Director October 25, 1996
- -----------------------------------------
Stephen Sohn, M.D.
/S/ GEORGE LOMBARDI Chief Financial October 25, 1996
- ----------------------------------------- Officer and Chief
George Lombardi Accounting
Officer
/S/ BERNARD LAURENT Director October 25, 1996
- -----------------------------------------
Bernard Laurent
/S/ MICHAEL ZELDIN Director and Chief October 25, 1996
- ----------------------------------------- Scientific Officer
Michael Zeldin
/S/ THOMAS M. FITZGERALD Director and Chief October 25, 1996
- ----------------------------------------- Operating Officer
Thomas M. Fitzgerald
</TABLE>
II-9
Exhibit 23.1
The Board of Directors
Sheffield Medical Technologies Inc.:
We consent to incorporation by reference in the Registration Statement (Form S-8
No. 33-95262) of Sheffield Medical Technologies Inc. of our report dated
February 11, 1994, relating to the consolidated financial statements of
Sheffield Medical Technologies Inc. and subsidiary included in the Annual Report
(Form 10-KSB) for the year ended December 31, 1995.
Our report dated February 11, 1994, contains an explanatory paragraph that
states that the Company's recurring losses and net deficit position raise
substantial doubt about its ability to continue as a going concern. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/S/ KPMG PEAT MARWICK LLP
-------------------------
KMPG Peat Marwick LLP
Houston, Texas
October 24, 1996
Exhibit 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in Amendment
No. 1 to the Registration Statement (Form S-8 No. 33-95262) pertaining to the
1993 Stock Option Plan of Sheffield Medical Technologies Inc., the 1993
Restricted Stock Plan of Sheffield Medical Technologies Inc. and options granted
to directors, officers, employees, consultants and advisors of the Company
pursuant to other employee benefit plans of Sheffield Medical Technologies Inc.
and to the incorporation by reference therein of our report dated February 28,
1996, except for Note 10 as to which the date is April 10, 1996, with respect to
the consolidated financial statements of Sheffield Medical Technologies Inc. and
subsidiary 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
---------------------
Ernst & Young LLP
Princeton, New Jersey
October 21, 1996
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