As filed with the Securities and Exchange Commission on September 24, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
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VIDAMED, INC.
(Exact name of Registrant as specified in its charter)
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Delaware 77-0314454
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
46107 Landing Parkway
Fremont, California 94538
(510) 492-4900
(Address, including zip code, and telephone number, including area code,
of Registrant's principal executive offices)
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JAMES A. HEISCH
President and Chief Executive Officer
VidaMed, Inc.
46107 Landing Parkway
Fremont, California 94538
(510) 492-4900
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
Christopher D. Mitchell, Esq.
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, CA 94304-1050
(650) 493-9300
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.[ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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<PAGE>
<TABLE>
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
<CAPTION>
Proposed
Proposed Maximum
Title of Each Class Amount Maximum Aggregate Amount of
of Securities to to be Offering Price Offering Registration
be Registered Registered Per Share(1) Price Fee
-------------------------- --------------------- ----------------------- ----------------
<S> <C> <C> <C> <C>
Common Stock
$0.001 par value...................... 2,517,652 shares $ 5.25 $13,217,673 4,362
- --------------------------------------- =========================== ====================== ======================== ===============
Common Stock
$0.001 par value issuable
upon exercise of warrants............. 629,413 shares $ 6.33 $3,984,185 1,20907
======================================== =========================== ====================== ======================== ===============
<FN>
(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) promulgated under the Securities
Act of 1933.
(2) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(g)(1) promulgated under the
Securities Act of 1933.
</FN>
</TABLE>
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
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 SEPTEMBER 24, 1997
PROSPECTUS
VIDAMED, INC.
3,147,065 Shares of Common Stock
This Prospectus relates to (i) 2,517,652 shares (the "Shares") of
common stock, $.001 par value per share (the "Common Stock") and (ii) a maximum
of 629,413 additional shares of Common Stock (the "Warrant Shares") issuable
upon exercise of certain warrants (the "Warrants") to purchase Common Stock of
VidaMed, Inc. (the "Company" or "VidaMed"). The Shares and the Warrant Shares
collectively are referred to herein as the "Securities." The Securities may be
offered by certain stockholders of the Company (the "Selling Security Holders")
from time to time in transactions in the over-the-counter market through Nasdaq,
in privately negoti ated transactions, through the writing of options on the
Securities, or through a combination of such methods of sale, at fixed prices
that may be changed, at market prices prevailing at the time of sale, at prices
relating to such prevailing market prices or at negotiated prices. The Selling
Security Holders may effect such transactions by selling the Securities to or
through broker-dealers, and such broker-dealers may receive compensation in the
form of discounts, concessions or commissions from the Selling Security Holders
and/or the purchasers of the Securities for whom such broker-dealers may act as
agents or to whom they may sell as principals, or both (which compensation as to
a particular broker-dealer might be in excess of customary commissions). See
"Selling Security Holders" and "Plan of Distribution."
None of the proceeds from the sale of the Securities by the Selling
Security Holders will be received by the Company. The Company has agreed to bear
all expenses (other than selling commissions and fees and ex penses of counsel
and other advisers to the Selling Security Holders) in connection with the
registration and sale of the Securities being offered by the Selling Security
Holders. The Company has agreed to indemnify the Selling Security Holders
against certain liabilities, including liabilities under the Securities Act of
1933, as amended (the "Securities Act").
All the Securities were "restricted securities" under the Securities
Act prior to their registration here under. The Company sold 2,517,652 shares of
Common Stock and 629,413 Warrants to the Selling Security Holders in private
transactions in September 1997. Such shares of Common Stock and the 629,413
Warrant Shares which may be issuable upon exercise of the Warrants (such shares
together the "Securities") are registered hereunder. This Prospectus has been
prepared so that future sales of Common Stock by the Selling Security Holders
will not be restricted under the Securities Act. In connection with any sales,
the Selling Security Holders and any brokers participating in such sales may be
deemed to be "underwriters" within the meaning of the Securities Act.
See "Selling Security Holders."
The Company's Common Shares are traded on the Nasdaq National Market
System under the symbol "VIDA."
---------------------------
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS."'
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is [ ] __, 1997
<PAGE>
AVAILABLE INFORMATION
As used in this Prospectus, unless the context otherwise requires, the
terms "VidaMed" and the "Company" mean VidaMed, Inc. and its subsidiaries. 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"). Reports, proxy statements and other
information filed with the Commission pursuant to the informational requirements
of the Exchange Act may be inspected and copied at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following regional offices of the Commission:
New York Regional Office, 7 World Trade Center, Suite 1300, New York, New York
10048; and Chicago Regional Office, Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661. Copies of such materials may be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission maintains a World
Wide Web site that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the Commission.
The address of the site is http://www.sec.gov.
The Company's Common Stock is traded on the Nasdaq National Market.
Reports and other information concerning the Company may be inspected at the
National Association of Securities Dealers, Inc., 1735 K Street, N.W.,
Washington, D.C. 20006.
This Prospectus constitutes part of a Registration Statement on Form
S-3 (herein, together with all amendments and exhibits thereto, referred to as
the "Registration Statement") filed by the Company with the Commission under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. For
further information, reference is hereby made to the Registration Statement,
copies of which may be obtained from the Public Reference Section of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, upon payment of the
fees prescribed by the Commission. Statements contained in this Prospectus as to
the contents of any contract or any other document filed, or incorporated by
reference, as an exhibit to the Registration Statement, are qualified in all
respects by such reference.
INFORMATION INCORPORATED BY REFERENCE
The Company's Form 8-A filed with the Commission on January 31, 1997,
the Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1996, the Company's Quarterly Reports on Form 10-Q for the quarters ended March
31, 1997 and June 30, 1997 and the Company's Current Report on Form 8-K filed on
September 24, 1997 heretofore filed by the Company with the Commission pursuant
to the Exchange Act, are hereby incorporated by reference, except as superseded
or modified herein.
Each document filed subsequent to the date of this Prospectus pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to the
termination of this offering shall be deemed to be incorporated by reference
into this Prospectus and shall be part hereof from the date of filing of such
document.
The Company will provide without charge to each person to whom a copy
of this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any document described above (other than exhibits). Requests
for such copies should be directed to VidaMed, Inc. at its principal offices
located at 46107 Landing Parkway, Fremont, California 94538, telephone (510)
492-4902, attention Investor Relations.
<PAGE>
Any statement contained in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed to constitute a part of this Prospectus except as so modified, and any
statement so superseded shall not be deemed to constitute part of this
Prospectus.
VidaMed(R), the VidaMed logo and TUNA(TM) are trademarks of VidaMed,
Inc.
<PAGE>
THE COMPANY
VidaMed, Inc. (the "Company" or "VidaMed") was founded in July 1992 and
reincorporated in the State of Delaware in June 1995. VidaMed designs, develops,
manufactures and markets technologically and clinically advanced, cost effective
systems for urological applications. The Company's initial focus is upon the
treatment of benign prostatic hyperplasia ("BPH"). The Company's first product,
the patented TUNA System, is designed to offer a cost effective, minimally
invasive alternative therapy with compelling clinical advantages for BPH
treatment. The Company commenced manufacturing production and product sales in
1993. On October 8, 1996, the Company received 510(k) clearance from the United
States Food and Drug Administration ("FDA") to market the TUNA System
commercially in the United States for the treatment of BPH. In the United
States, the Company sells its products primarily through direct sales personnel
and a network of specialty urology product dealers. International sales are
primarily to distributors who resell to physicians and hospitals.
VidaMed has designed and developed the TUNA System to be the therapy of
choice for BPH over watchful waiting, drug therapy and current surgical
therapies. The TUNA System is designed to restore and improve urinary flow while
resulting in fewer complications and adverse effects, shorter recovery time and
greater cost effectiveness than other therapies for treating BPH. The Company
believes that the cost of treatment with TUNA will be less than the cost of many
other interventional BPH therapies because the procedure is designed to be
performed on an outpatient basis and to result in fewer complications.
The principal components of the TUNA system are (i) a single-use needle
ablation handpiece that delivers RF energy to the prostate, (ii) a low power RF
energy generator and (iii) an optical device that allows direct viewing during
the procedure.
TUNA Handpiece. The single-use TUNA handpiece measures 22 French
(approximately seven millimeters) in diameter and contains laterally deployed
needles that extend at an approximately 90 degree angle. Each needle is encased
by a retractable shield which protects the urethra and is adjusted by the
urologist to selectively control the area of prostate tissue ablated during the
procedure. Controls on the handpiece handle allow for independent advancement
and retraction of the needle and shields. Thermocouples located at the shield
tip and at the handpiece tip record temperatures at the lesion site and in the
prostatic urethra. The handpiece includes capabilities for irrigation and
aspiration, enhancing visualization for the physician and enabling drainage of
the bladder without removing and reinserting the handpiece. In addition, these
capabilities allow the physician to more closely control urethral tissue
temperature during the procedure.
TUNA RF Generator. The TUNA RF energy generator is designed
specifically for use with the TUNA handpiece. The RF generator has digital
displays indicating the temperature at each thermocouple, the RF power being
delivered to each needle, ablation time and electrical impedance. These
measurements are used by the physician to control tissue ablation. The generator
incorporates both automated and manual control modes. The generator has an
automatic shut-off activated by both temperature and impedance measurements to
ensure controlled tissue ablation.
TUNA Optics. The TUNA optical device allows precise positioning of the
handpiece between the verumontanum and the bladder neck during the procedure
using direct vision control. The optical device is reusable after sterilization
and is equipped with a three-way exchange adapter, which allows the unit to be
used with endoscopic light sources manufactured by other companies.
The TUNA procedure desiccates prostatic tissue, leading to improved
urinary flow, and can be performed in approximately 30 to 45 minutes with local
anesthesia, which may be supplemented by intravenous sedation. The TUNA
handpiece is inserted into the patient's urethra, and the two shielded needle
electrodes are then
<PAGE>
advanced into one of the two lateral lobes of the prostate. Controlled RF energy
delivered by the needle electrodes heats targeted portions of the prostate lobe
to temperatures of 90 to 100 degrees centigrade, creating a localized area of
desiccated tissue measuring approximately one to two centimeters in diameter,
while the shields protect the urethra from thermal damage. Once a lesion of
sufficient size has been created, the urologist retracts the needles and places
the handpiece at the next site to be ablated and repeats the process. Typically,
two treatments in each lateral prostate lobe are performed depending upon the
size of the prostate. If the patient is unable to urinate due to temporary
swelling or irritation of the urethra, a catheter will be inserted into the
patient's urethra. This catheter, if inserted, is typically left in place for
one to two days.
The Company believes that the design of the TUNA system offers
significant advantages over other BPH therapies. Because the TUNA system shields
the urethra and delivers controlled RF energy directly into the interior of the
prostate, the procedure protects the prostatic urethra and reduces the risk of
unintended thermal damage to surrounding structures. In other procedures where
this control does not exist, the prostatic urethra and other structures can be
damaged or destroyed, causing significant patient discomfort and complications.
Clinical trials of the TUNA system indicate that TUNA results in fewer of the
complications associated with transurethral resection of prostate ("TURP")
surgery, including impotence, retrograde ejaculation and incontinence. The
Company believes that the cost of the TUNA procedure in the United States,
including physician charges, will be significantly less than the cost of TURP.
The TUNA RF generator is typically currently sold at approximately $35,000 in
the United States, which is less than the general surgical lasers required to
perform laser procedures and the ultrasound and microwave devices required for
other surgical procedures.
The Company believes TUNA will also provide patients, physicians and
health care payors with a clinically and economically superior alternative to
ongoing drug therapy, other minimally invasive surgeries and watchful waiting.
To date, the symptomatic relief experienced by patients in the Company's
clinical trials suggests that TUNA provides greater relief than drug therapy or
watchful waiting. The Company believes that if the relief provided by TUNA
proves to be sufficiently long lasting, TUNA may prove to be economically
superior to the noninvasive approaches. To date, the Company's available two to
three-year clinical follow-up data for TUNA patients do not suggest the need for
retreatment within this time frame. However, there can be no assurance as to
whether and how frequently TUNA patients will require retreatment.
The Company has recently relocated to a new facility in Fremont,
California. This facility has the capacity and resources for manufacturing the
headpiece component of the TUNA system. Accordingly, the Company is currently
exploring various alternatives for consolidation of TUNA system manufacturing at
this facility.
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<PAGE>
RISK FACTORS
An investment in the Securities being offered by this Prospectus
involves a high degree of risk. The following factors, in addition to those
discussed elsewhere in this Prospectus, should be carefully considered in
evaluating the Company and its business prospects before purchasing Securities
offered by this Prospectus.
Limited Operating History; History of Losses and Expectation of Future
Losses; Fluctuations in Operating Results. The Company has a limited history of
operations. Since its inception in July 1992, the Company has been primarily
engaged in research and development of the TUNA system. The Company has
experienced significant operating losses since inception and, as of June 30,
1997, had an accumulated deficit of $60.2 million.
The development and commercialization by the Company of the TUNA system
and other new products, if any, will require substantial product development,
clinical, regulatory, marketing and other expenditures. The Company expects its
operating losses to continue for at least the next 12 to 18 months as it
continues to expend substantial resources in expanding marketing and sales
activities, funding clinical trials in support of regulatory and reimbursement
approvals and research and development. There can be no assurance that the TUNA
system will be successfully commercialized or that the Company will achieve
significant revenues from either international or domestic sales. In addition,
there can be no assurance that the Company will achieve or sustain profitability
in the future. Results of operations may fluctuate significantly from quarter to
quarter and will depend upon numerous factors, including actions relating to
regulatory and reimbursement matters, progress of clinical trials, the extent to
which the TUNA system gains market acceptance, varying pricing promotions and
volume discounts to distributors, introduction of alternative therapies for BPH
and competition.
Uncertainty of Market Acceptance. TUNA represents a new therapy for
BPH, and there can be no assurance that the TUNA system will gain any
significant degree of market acceptance among physicians, patients and health
care payors, even if necessary international and United States reimbursement
approvals are obtained. Physicians will not recommend the TUNA procedure unless
they conclude, based on clinical data and other factors, that it is an
attractive alternative to other methods of BPH treatment, including more
established methods such as TURP and drug therapy. In particular, physicians may
elect not to recommend the TUNA procedure until such time, if any, as the
duration of the relief provided by the procedure has been established. Broad use
of the TUNA system will require the training of numerous physicians, and the
time required to complete such training could result in a delay or dampening of
market acceptance. Even if the clinical efficacy of the TUNA procedure is
established, physicians may elect not to recommend the procedure unless
acceptable reimbursement from health care payors is available. Health care payor
acceptance of the TUNA procedure will require evidence of the cost effectiveness
of TUNA as compared to other BPH therapies, which will depend in large part on
the duration of the relief provided by the TUNA procedure. A thorough analysis
of multi-year patient follow-up data will be necessary to assess the durability
of the relief provided by TUNA therapy. Patient acceptance of the procedure will
depend in part on physician recommendations as well as other factors, including
the degree of invasiveness and rate and severity of complications associated
with the procedure as compared to other therapies.
Uncertainty Relating to Third Party Reimbursement. The Company's
success will be dependent upon, among other things, its ability to obtain
satisfactory reimbursement from health care payors for the TUNA procedure. In
the United States and in international markets, third party reimbursement is
generally available for existing therapies used for treatment of BPH. In the
United States, third party reimbursement for the TUNA procedure will be
dependent upon decisions by the Health Care Financing Administration ("HCFA")
for Medicare, as well as by individual health maintenance organizations, private
insurers and other payors.
-3-
<PAGE>
Reimbursement systems in international markets vary significantly by
country. Many international markets have governmentally managed health care
systems that govern reimbursement for new devices and procedures. In most
markets, there are private insurance systems as well as governmentally managed
systems.
Regardless of the type of reimbursement system, the Company believes
that physician advocacy of the TUNA system will be required to obtain
reimbursement. Availability of reimbursement will depend not only on the
clinical efficacy and direct cost of the TUNA procedure, but also on the
duration of the relief provided by the procedure. In the United States, TUNA
procedures are currently being reimbursed by certain private payors. However,
due to the age of the typical BPH patient, Medicare reimbursement is
particularly critical for widespread market acceptance of the TUNA procedure in
the United States. Although certain state Mediczre directors have permitted
reimbursement for TUNA procedures on an ad hoc basis, national Medicare
reimbursement will require, at a minimum, publication by HCFA of an American
Medical Association ("AMA") current procedure terminology ("CPT") code covering
the TUNA procedure. The Company has been advised by the AMA that a CPT code
covering the physician fee component of the TUNA procedure will be included in
the 1998 edition of CPT codes which will become effective January 1, 1998.
However, national Medicare reimbursement of TUNA procedure costs in an office
setting at an adequate level will in addition require, among other things,
completion by HCFA of a review of the cost and efficacy of the TUNA procedure.
Such cost and efficacy review may involve an assessment of clinical data with up
to five-year patient follow-up. Accordingly, there can be no assurance that
reimbursement for the Company's products will be available in the United States
or in international markets under either governmental or private reimbursement
systems at adequate levels, or that physicians will support reimbursement for
TUNA procedures. Furthermore, the Company could be adversely affected by changes
in reimbursement policies of governmental or private health care payors. Failure
by physicians, hospitals and other users of the Company's products to obtain
sufficient reimbursement from health care payors, including in particular
Medicare reimbursement in the United States, or adverse changes in governmental
and private third party payors' policies toward reimbursement for procedures
employing the Company's products would have a material adverse effect on the
Company's business, financial condition and results of operations.
Risk of Inadequate Funding. The Company plans to continue to expend
substantial funds for clinical trials in support of regulatory and reimbursement
approvals, expansion of sales and marketing activities, research and development
and establishment of commercial scale manufacturing capability. The Company may
be required to expend greater than anticipated funds if unforeseen difficulties
arise in the course of clinical trials of the TUNA system, in connection with
obtaining necessary regulatory and reimbursement approvals or in other aspects
of the Company's business. Although the Company believes that its existing cash
reserves, including the proceeds from the sale of the securities being
registered for resale and cash generated from the future sale of products will
be sufficient to meet the Company's operating and capital requirements during
the next 12 to 18 months, there can be no assurance that the Company will not
require additional financing within this time frame. The Company's future
liquidity and capital requirements will depend upon numerous factors, including
progress of clinical trials, actions relating to regulatory and reimbursement
matters, and the extent to which the TUNA system gains market acceptance. Any
additional financing, if required, may not be available on satisfactory terms or
at all. Future equity financings may result in dilution to the holders of the
Company's Common Stock. Future debt financings may require the Company to pledge
assets and to comply with financial and operational covenants.
Possible Volatility of Stock Price. The stock market has from time to
time experienced significant price and volume fluctuations that are unrelated to
the operating performance of particular companies. These broad market
fluctuations may adversely affect the market price of the Company's Common
Stock. In addition, the market price of the shares of Common Stock is likely to
be highly volatile. Factors such as fluctuations in the Company's operating
results, announcements of technological innovations or new products by the
Company or
-4-
<PAGE>
its competitors, FDA and international regulatory actions, actions with respect
to reimbursement matters, developments with respect to patents or proprietary
rights, public concern as to the safety of products developed by the Company or
others, changes in health care policy in the United States and internationally,
changes in stock market analyst recommendations regarding the Company, other
medical device companies or the medical device industry generally and general
market conditions may have a significant effect on the market price of the
Common Stock.
Competition and Technological Advances. Competition in the market for
treatment of BPH is intense and is expected to increase. The Company believes
its principal competition will come from invasive therapies, such as TURP, and
noninvasive courses of action, such as drug therapy and watchful waiting. The
Company may encounter competition from emerging therapies in attracting clinical
investigators as well as prospective clinical trial patients. Most of the
Company's competitors have significantly greater financial, technical, research,
marketing, sales, distribution and other resources than the Company. There can
be no assurance that the Company's competitors will not succeed in developing or
marketing technologies and products that are more effective or commercially
attractive than any which are being developed by the Company. Such developments
could have a material adverse effect on the Company's business, financial
condition and results of operations.
Any product developed by the Company that gains regulatory approval
will have to compete for market acceptance and market share. An important factor
in such competition may be the timing of market introduction of competitive
products. Accordingly, the relative speed with which the Company can develop
products, complete clinical testing and regulatory approval processes, gain
reimbursement acceptance and supply commercial quantities of the product to the
market are expected to be important competitive factors. The Company expects
that competition in the BPH field will also be based, among other things, on the
ability of the therapy to provide safe, effective and lasting treatment, cost
effectiveness of the therapy, physician, health care payor and patient
acceptance of the procedure, patent position, marketing and sales capability,
and third party reimbursement policies.
Government Regulation. The Company's TUNA system is regulated in the
United States as a medical device by the FDA under the Federal Food, Drug, and
Cosmetic Act ("FDC Act"). Pursuant to the FDC Act, the FDA regulates the
manufacture, distribution and production of medical devices in the United
States. Noncompliance with applicable requirements can result in fines,
injunctions, civil penalties, recall or seizure of products, total or partial
suspension of production, failure of the government to grant approval for
devices, and criminal prosecution. Medical devices are classified into one of
three classes, class I, II or III, on the basis of the controls necessary to
reasonably ensure their safety and effectiveness. The safety and effectiveness
can be assured for class I devices through general controls (e.g., labeling,
premarket notification and adherence to GMPs) and for class II devices through
the use of special controls (e.g., performance standards, postmarket
surveillance, patient registries, and FDA guidelines). Generally, class III
devices are those which must receive premarket approval by the FDA to ensure
their safety and effectiveness (e.g., life-sustaining, life-supporting and
implantable devices, or new devices which have not been found substantially
equivalent to legally marketed devices).
Before a new device can be introduced into the market, the manufacturer
must generally obtain FDA clearance through either a 510(k) notification or a
premarket approval ("PMA"). A 510(k) clearance will be granted if the submitted
data establishes that the proposed device is "substantially equivalent" to a
legally marketed class I or II medical device, or to a class III medical device
for which the FDA has not called for a PMA. The FDA has recently been requiring
a more rigorous demonstration of substantial equivalence than in the past. It
generally takes from three to nine months from submission to obtain a 510(k)
clearance, but it may take longer. The FDA may determine that the proposed
device is not substantially equivalent, or that additional data is needed before
a substantial equivalence determination can be made. A "not substantially
equivalent"
-5-
<PAGE>
determination, or a request for additional data, could delay the market
introduction of new products that fall into this category and could have a
materially adverse effect on the Company's business, financial condition and
results of operations. There can be no assurance that the Company will obtain
510(k) clearance within the above time frames, if at all, for any device for
which it files a future 510(k) notification. Furthermore, there can be no
assurance that the Company will not be required to submit a PMA application for
any device which it may develop in the future. For any of the Company's products
that are cleared through the 510(k) process, including the Company's TUNA
System, modifications or enhancements that could significantly affect safety or
efficacy will require new 510(k) submissions.
Sales of medical devices outside the United States are subject to
regulatory requirements that vary widely from country to country. The time
required to obtain approval for sale in a foreign country may be longer or
shorter than that required for FDA approval, and the requirements may differ.
VidaMed has received regulatory approvals where required for commercial sale of
the TUNA system in all major international markets. In May 1994 the Company's
United Kingdom facility passed inspection by the United Kingdom Department of
Health and received GMP certification. In June 1994, the Company received a
report of compliance for the TUNA system from the British Standards Institute
("BSI") and in August 1994 the Company received a certificate of compliance with
IEC 601-1 and IEC 601-2 regulations from TUV Product Services. TUV and BSI
certifications, which are issued by organizations analogous to Underwriters
Laboratories in the United States, are focused on device safety and adherence of
the device to published electronic or mechanical specifications. In February
1995, the Company received ISO 9002 certification for its manufacturing facility
in the United Kingdom. ISO 9002 certification is based on adherence to
established standards in the areas of quality assurance and manufacturing
process control. These certifications allow the Company to affix the CE mark to
the TUNA system, permitting the Company to commercially market and sell the TUNA
system in all countries of the European Economic Area. In order to maintain
these approvals, the Company is subject to periodic inspections. Additional
product approvals from foreign regulatory authorities may be required for
international sale of the Company's general electrosurgical device for which an
FDA 510(k) notification has been filed. Failure to comply with applicable
regulatory requirements can result in loss of previously received approvals and
other sanctions and could have a material adverse effect on the Company's
business, financial condition and results of operations.
The Company's distributor in Japan, Century Medical, is responsible for
management of clinical trials and obtaining regulatory and reimbursement
approval for the TUNA system. Such regulatory approval was received from the
Japanese Ministry of Health and Welfare in July 1997. However, market acceptance
in Japan will be dependent in large part upon receipt of reimbursement approvals
in the Japanese health care system. Such reimbursement approvals have not yet
been obtained and there can be no assurance that the Company or Century Medical
will ever obtain such approvals. Failure to obtain reimbursement approval for
the TUNA procedure in Japan could preclude the commercial viability of the
Company's products in Japan and could have a material adverse effect on the
Company's business, financial condition and results of operations.
Limited Manufacturing Experience; Scale-Up Risk; Product Recall Risk.
VidaMed purchases components used in the TUNA system from various suppliers and
relies on single sources for several components. Delays associated with any
future component shortages, particularly as the Company scales up its
manufacturing activities in support of commercial sales, could have a material
adverse effect on the Company's business, financial condition and results of
operations.
The Company currently manufactures the TUNA system in limited
quantities at its United Kingdom facility. However, the Company has limited
experience in manufacturing its products in commercial quantities. Manufacturers
often encounter difficulties in scaling up production of new products, including
problems involving production yields, quality control and assurance, component
supply and lack of qualified personnel.
-6-
<PAGE>
Difficulties encountered by VidaMed in manufacturing scale-up could have a
material adverse effect on its business, financial condition and results of
operations. In mid-1994, the Company experienced problems at its United Kingdom
facility with respect to mechanical aspects of the TUNA catheter's needle
assembly. As a result, a substantial portion of catheters in the field were
returned for rework. The Company has modified its manufacturing process to
rectify these problems and has completed product rework. However, there can be
no assurance that future manufacturing difficulties or product recalls, either
of which could have a material adverse effect on the Company's business,
financial condition and results of operations, will not occur. In addition, the
Company's new Fremont facility has capacity to manufacture the TUNA system
headpiece and the Company is currently in the process of qualifying this
facility under FDA good manufacturing practice regulations and under ISO 9000
standards. The Company is also exploring alternatives for consolidating TUNA
headpiece manufacturing in Fremont. Inability to obtain FDA good manufacturing
practice and ISO 9000 qualification for the Fremont facility, or problems
associated with any future consolidation of manufacturing at such facility,
could have a material adverse effect on the Company's business.
Any products manufactured or distributed by the Company pursuant to FDA
clearances or approvals are subject to pervasive and continuing regulation by
FDA including recordkeeping requirements and reporting of adverse experience
with the use of the device. The Company's manufacturing facilities are subject
to periodic inspection by FDA, certain state agencies and foreign regulatory
agencies. Failure to comply with regulatory requirements could have a material
adverse effect on the Company's business. There can be no assurance that the
Company will not be required to incur significant costs to comply with laws and
regulations in the future or that laws or regulations will not have a material
adverse effect upon the Company's business.
Uncertainty Regarding Patents and Protection of Proprietary Technology.
The Company has been issued 30 United States patents covering a method of
prostate ablation using the TUNA System and the design of the TUNA System. The
Company currently has approximately 27 patent applications on file in the United
States and over 80 corresponding patent applications on file in various foreign
countries. In addition, the Company holds licenses to certain technology used in
the TUNA System. There can be no assurance that the Company's issued United
States patents, or any patents which may be issued as a result of the Company's
applications, will offer any degree of protection. There can be no assurance
that any of the Company's patents or patent applications will not be challenged,
invalidated or circumvented in the future. In addition, there can be no
assurance that competitors, many of which have substantial resources and have
made substantial investments in competing technologies, will not seek to apply
for and obtain patents that will prevent, limit or interfere with the Company's
ability to make, use or sell its products either in the United States or in
international markets.
Intellectual Property Litigation Risks. The medical device industry has
been characterized by extensive litigation regarding patents and other
intellectual property rights, and companies in the medical device industry have
employed intellectual property litigation to gain a competitive advantage. The
Company is aware of patents held by other participants in the BPH market, and
there can be no assurance that the Company will not in the future become subject
to patent infringement claims and litigation or United States Patent and
Trademark Office ("USPTO") interference proceedings. The defense and prosecution
of intellectual property suits, USPTO inter ference proceedings and related
legal and administrative proceedings are both costly and time consuming. Liti
gation may be necessary to enforce patents issued to the Company, to protect
trade secrets or know-how owned by the Company or to determine the
enforceability, scope and validity of the proprietary rights of others.
Any litigation or interference proceedings could result in substantial
expense to the Company and significant diversion of effort by the Company's
technical and management personnel. An adverse determination in litigation or
interference proceedings to which the Company may become a party could subject
the Company to significant liabilities to third parties or require the Company
to seek licenses from third parties. Although
-7-
<PAGE>
patent and intellectual property disputes in the medical device area have often
been settled through licensing or similar arrangements, costs associated with
such arrangements may be substantial and could include ongoing royalties.
Furthermore, there can be no assurance that necessary licenses would be
available to the Company on satisfactory terms or at all. Accordingly, an
adverse determination in a judicial or administrative proceeding or failure to
obtain necessary licenses could prevent the Company from manufacturing and
selling its products, which would have a material adverse effect on the
Company's business, financial condition and results of operations.
In addition to patents, the Company relies on trade secrets and
proprietary know-how, which it seeks to protect, in part, through proprietary
information agreements with employees, consultants and other parties. The
Company's proprietary information agreements with its employees and consultants
contain industry standard pro visions requiring such individuals to assign to
the Company without additional consideration any inventions con ceived or
reduced to practice by them while employed or retained by the Company, subject
to customary excep tions. There can be no assurance that proprietary information
agreements with employees, consultants and others will not be breached, that the
Company would have adequate remedies for any breach, or that the Company's trade
secrets will not otherwise become known to or independently developed by
competitors.
Rights to Founder's Inventions Limited to Urology. The proprietary
information agreement between the Company and Stuart D. Edwards, one of the
Company's founders, obligates Mr. Edwards to assign to the Com pany his
inventions and related intellectual property only in the field of urology. Mr.
Edwards has assigned to Rita Medical Systems, Inc. ("RITA") his inventions in
the cancer field. Mr. Edwards has conceived of, and may continue to conceive of,
various medical device product concepts for other fields outside of urology,
including certain product concepts for the treatment of snoring and sleep apnea
that have been assigned to an unrelated third party and certain product concepts
in the gynecology field that have been licensed to another unrelated third
party. Such party also has an option to purchase all future technology developed
by Mr. Edwards in the gynecology field. Product concepts outside of urology
developed by Mr. Edwards will not be owned by or commercialized through VidaMed,
and VidaMed will have no rights or ownership interests with respect thereto.
Risks Relating to RITA. The Company has entered into a cross license
agreement with RITA, formerly ZoMed International, Inc. Under the cross license,
RITA has the right to use VidaMed technology in the cancer field and VidaMed has
the right to use RITA technology in the treatment of urological diseases and
disorders. The cross license between VidaMed and RITA allows both companies to
develop products for treatment of prostate cancer and cancers of the lower
urinary tract, and VidaMed and RITA may therefore become competitors in this
field.
Product Liability Risk; Limited Insurance Coverage. The business of the
Company entails the risk of product liability claims. Although the Company has
not experienced any product liability claims to date, any such claims could have
an adverse impact on the Company. The Company maintains product liability
insurance and evaluates its insurance requirements on an ongoing basis. There
can be no assurance that product liability claims will not exceed such insurance
coverage limits or that such insurance will be available on commercially
reasonable terms or at all.
Effect of Certain Charter, Bylaw and Other Provisions. Certain
provisions of the Company's Certificate of Incorporation and Bylaws may have the
effect of making it more difficult for a third party to acquire, or of
discouraging a third party from attempting to acquire, control of the Company.
Such provisions could limit the price that certain investors might be willing to
pay in the future for shares of the Company's Common Stock. Certain of these
provisions allow the Company to issue Preferred Stock without any vote or
further action by the stockholders, eliminate the right of stockholders to act
by written consent without a meeting and eliminate cumu-
-8-
<PAGE>
lative voting in the election of directors. These provisions may make it more
difficult for stockholders to take certain corporate actions and could have the
effect of delaying or preventing a change in control of the Company.
No Public Market for the Warrants; Arbitrary Determination of Purchase
Price; Price Volatility. Prior to the offering of the Securities, there has been
no public market for the Warrants, and there can be no assurance that an active
trading market will develop in any of the Warrants after any offering thereof.
The Company does not intend to apply for the listing of the Warrants on any
exchange. The exercise price and terms of the Warrants may be determined
arbitrarily by negotiations between the Company and any purchaser thereof.
Factors con sidered in such negotiations, in addition to prevailing market
conditions, may include the history and prospects for the industry in which the
Company competes, an assessment of the Company's management, the prospects of
the Company, its capital structure and certain other factors as were deemed
relevant. Therefore, the exercise price and terms of the Warrants may not
necessarily bear any relationship to established valuation criteria and
therefore may not be indicative of prices that may prevail at any time or from
time to time in a public market for the Warrants.
Legal Restrictions on Sales of Shares Underlying the Warrants. The
Warrants will not be exercisable unless, at the time of the exercise, the
Company has a current prospectus covering the shares of Common Stock issuable
upon exercise of the Warrants, and such shares have been registered, qualified
or deemed to be exempt under the securities laws of the state of residence of
the exercising holder of the Warrants. Although the Company has undertaken to
use its best efforts to have all the shares of Common Stock issuable upon
exercise of the Warrants registered or qualified on or before the exercise date
and to maintain a current prospectus relating thereto until the expiration of
the Warrants, there can be no assurance that it will be able to do so. The
Warrants may be deprived of value if a current prospectus covering the shares of
Common Stock issuable upon the exercise of the Warrants is not kept effective.
-9-
<PAGE>
SELLING SECURITYHOLDERS
<TABLE>
The following table provides the names of the Selling Security Holders
and the number of Securities being offered by each of them. After completion of
this offering, assuming all the Shares and Warrant Shares offered hereby are
sold, no Selling Security Holder will hold any securities of the Company except
as set forth in the footnotes below.
<CAPTION>
Selling Security Holders No. of Shares Offered No. of Warrant Shares Offered
- ------------------------ --------------------- -----------------------------
<S> <C> <C>
INVESCO Trust Company(1) 1,052,632 263,158
Kane & Co. 147,400 36,850
for Arthur D. Little Employee Investment Plan
Mellon Bank N.A. 694,700 173,675
Custodian for PERSI - Zesiger Capital for Public
Employee Retirement System of Idaho
Westcoast & Co. 210,500 52,625
for State of Oregon PERS/ZCG
ProMed Partners, LP 55,264 13,816
David B. Musket 41,364 10,341
Augusta Capital Management 105,264 26,316
Circle F Ventures (2) 210,528 52,632
<FN>
- -----------------------
(1) Consists of shares held by Global Health Sciences Fund. GHS is a mutual
fund company advised by INVESCO Funds Group, Inc., which is a subsidiary
of INVECO PLC. INVESCO Trust Company is a subsidiary of INVESCO Funds
Group, Inc.
(2) Circle F Ventures owns 71,900 shares of Common Stock of the Company in
addition to the Shares and the Warrant Shares offered hereby.
</FN>
</TABLE>
No Selling Security Holder has held any position, office or other
material relationship with the Company or any of its affiliates within the past
three years.
The Company sold 2,517,652 Shares of Common Stock and Warrants to
purchase 629,413 Shares of Common Stock to the Selling Security Holders in
private transactions in September 1997. Such Shares, including the Warrant
Shares issuable upon exercise of the Warrants, are registered hereunder.
-10-
<PAGE>
Each Selling Security Holder has represented to the Company that it
purchased the Securities for investment, with no present intention of
distribution. However, in recognition of the fact that investors, even though
purchasing the Securities for investment, may wish to be legally permitted to
sell their securities when they deem appropriate, the Company has filed with the
Commission under the Securities Act the Registration Statement with respect to
the resale of the Shares and the Warrant Shares from time to time in the
over-the-counter market through Nasdaq or in privately negotiated transactions,
through the writing of options on the Shares or the Warrant Shares, or through a
combination of the foregoing. The Company has agreed to prepare and file such
amendments and supplements to the Registration Statement as may be necessary to
keep the Registration Statement effective for four years from the date of
closing of the issuance of the Shares.
-11-
<PAGE>
PLAN OF DISTRIBUTION
The sale of the Securities by the Selling Security Holders may be
effected from time to time in transactions in the over-the-counter market
through Nasdaq, in privately negotiated transactions, through the writing of
options on the Securities, or through a combination of such methods of sale, at
fixed prices, that may be changed, at market prices prevailing at the time of
sale, at prices relating to such prevailing market prices or at negotiated
prices. The Selling Security Holders may effect such transactions by selling the
Securities to or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions or commissions from the
Selling Security Holders and/or the purchasers of the Securities for whom such
broker-dealers may act as agents or to whom they may sell as principals, or both
(which compensation as to a particular broker-dealer may be in excess of
customary compensation). Any broker-dealer may act as a broker-dealer on behalf
of one or more of the Selling Security Holders in connection with the offering
of certain of the Securities by the Selling Security Holders.
The Selling Security Holders and any broker-dealers who act in
connection with the sale of the Securities hereunder may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, and
any commissions received by them and profit on any resale of the Securities as
principal might be deemed to be underwriting discounts and commissions under the
Securities Act. The Company has agreed to indemnify the Selling Security Holders
against certain liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for
VidaMed by Wilson Sonsini Goodrich & Rosati, Professional Corporation, Palo
Alto, California. As of the date of this Prospectus, members of Wilson Sonsini
Goodrich & Rosati, Professional Corporation, who have represented the Company in
connec tion with this offering, beneficially own approximately 8,809 shares of
the Company's Common Stock. J. Casey McGlynn, Secretary of the Company, and
Christopher D. Mitchell, Assistant Secretary of the Company, are members of
Wilson Sonsini Goodrich & Rosati, Professional Corporation.
EXPERTS
The Consolidated Financial Statements of VidaMed, Inc. incorporated by
reference in VidaMed, Inc.'s Annual Report (Form 10-K) for the fiscal year ended
December 31, 1996, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon incorporated by reference therein and
incorporated herein by reference. Such Consolidated Financial Statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
-12-
<PAGE>
================================================================================
No dealer, salesperson or other person has been authorized in
connection with any offering made hereby to give any information or to make any
representations other than those contained in or incorporated by reference in
this Prospectus, and, if given or made, such information or representations must
not be relied upon as having been authorized. This Prospectus does not
constitute an offer to sell or a solicitation of an offer to buy any security
other than the securities offered hereby, nor do they constitute an offer to
sell or a solicitation of any offer to buy any of the securities offered hereby
to any person in any jurisdiction in which such offer or solicitation would be
unlawful or to any person to whom it is unlawful. Neither the delivery of this
Prospectus nor any offer or sale made hereunder shall, under any circumstances,
create any implication that there has been no change in the affairs of the
Company or that the information contained herein is correct as of any time
subsequent to the date hereof.
---------------------------
TABLE OF CONTENTS
---------------------------
Page
----
Available Information.........................
Information Incorporated by
Reference....................................
The Company...................................
Risk Factors..................................
Selling Securityholders ......................
Plan of Distribution..........................
Legal Matters.................................
Experts.......................................
---------------------------
================================================================================
================================================================================
VIDAMED, INC.
3,147,065 Shares of Common Stock
---------------------------
PROSPECTUS
---------------------------
______________ , 1997
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the various expenses in connection with
the sale and distribution of the securities being registered, other than
underwriting discounts and commissions. All of the amounts shown are estimates
except the Securities and Exchange Commission registration fee, the NASD filing
fee and the Nasdaq National Market listing fee.
Securities and Exchange Commission registration fee.............. $ 5,569
Nasdaq National Market listing fee............................... 17,500
Printing and engraving expenses.................................. 15,000
Legal fees and expenses.......................................... 25,000
Accounting fees and expenses..................................... 7,500
Transfer agent and registrar fees and expenses................... 1,500
Miscellaneous.................................................... 2,931
-------
Total................................................... $75,000
=======
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law permits a
corporation to include in its charter documents, and in agreements between the
corporation and its directors and officers, provisions expanding the scope of
indemnification beyond that specifically provided by the current law.
Article VIII of the Registrant's Certificate of Incorporation provides
for the indemnification of directors to the fullest extent permissible under
Delaware law.
Article VI of the Registrant's Bylaws provides for the indemnification
of officers, directors and third parties acting on behalf of the corporation if
such person acted in good faith and in a manner reasonably believed to be in and
not opposed to the best interest of the corporation, and, with respect to any
criminal action or proceeding, the indemnified party had no reason to believe
his conduct was unlawful.
The Registrant has entered into indemnification agreements with its
directors and executive officers, in addition to indemnification provided for in
the Registrant's Bylaws, and intends to enter into indemnification agreements
with any new directors and executive officers in the future.
II-1
<PAGE>
Item 16. Exhibits
Exhibit
Number Description
- -------- -----------------------------------------------------------------------
1.1+ Purchase Agreement, dated as of September 22, 1997, between the
Registrant and certain purchasers named therein and the form of Common
Stock Purchase Warrant attached thereto as Exhibit B.
4.1++ Certificate of Incorporation of Registrant
4.2++ Restated Bylaws of Registrant
4.3+++ Form of Common Stock Certificate
4.4++++ Preferred Shares Rights Agreement dated as of January 27, 1997, between
the Registrant and American Securities Transfer & Trust, Inc.,
including the Certificate of Designations, the Form of Rights
Certificate and the Summary of Rights attached thereto as Exhibit A,
Exhibit B and Exhibit C, respectively.
4.5+ Form of Common Stock Purchase Warrant
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional Corporation
23.1 Consent of Ernst & Young, Independent Auditors
23.2 Consent of Wilson Sonsini Goodrich & Rosati, Professional Corporation
(included in Exhibit 5.1)
24.1 Power of Attorney (included on P. II-4)
- ---------------------------
+ Filed as exhibit 99.1 to the Registrant's Current Report on Form 8-K
filed with the Commission on September 24, 1997 and incorporated herein
by reference.
++ Filed as an exhibit to the Registrant's Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 and incorporated herein by
reference.
+++ Filed as an exhibit to the Registrant's Registration Statement on Form
S-1 (File No. 33-90746) and incorporated herein by reference.
++++ Filed as an Exhibit to the Registrant's Registration Statement on Form
8-A filed with the Commission on January 31, 1997 and incorporated
herein by reference.
Item 17. Undertaking
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and persons controlling the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been informed that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer of controlling persons of the Registrant in the successful defense of
any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
II-2
<PAGE>
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 to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to
be part of this registration statement as of the time it was declared effective.
3. That, for purposes of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of prospectus
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.
4. For purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report pursuant to Section 13(a)
or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
5. To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, VidaMed,
Inc. certifies that it has reasonable grounds to believe that it meets all
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Fremont, State of California, on this 23rd day of
September 1997.
VIDAMED, INC.
By: /s/ James A. Heisch
-------------------------------------
James A. Heisch
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints James A. Heisch and Richard D.
Brounstein, as his attorney-in-fact, with full power of substitution, for him in
any and all capacities, to sign any and all amendments to this Registration
Statement and to file the same, with exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, hereby
ratifying and confirming our signatures as they may be signed by our said
attorney to any and all amendments to said Registration Statement.
<TABLE>
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.
<CAPTION>
Signature Title Date
- ----------------------------------------- ------------------------------------------------ ------------------
<S> <C> <C>
/s/ James A. Heisch President and Chief Executive Officer and Sept. 23, 1997
- --------------------------------- Director (Principal Executive Officer)
(James A. Heisch) Sept. 23, 1997
/s/ Richard D. Brounstein
- --------------------------------- Vice President of Finance and Chief
(Richard D. Brounstein) Financial Officer (Principal Financial Officer Sept. 23, 1997
and Principal Accounting Officer)
/s/ David L. Douglass Director
- --------------------------------
(David L. Douglass)
/s/ Stuart D. Edwards Director Sept. 23, 1997
- --------------------------------
(Stuart D. Edwards)
/s/ Wayne I. Roe Director Sept. 23, 1997
- --------------------------------
(Wayne I. Roe)
/s/ Michael H. Spindler Director Sept. 23, 1997
- --------------------------------
(Michael H. Spindler)
</TABLE>
II-4
<PAGE>
Exhibit Index
Exhibit
Number Description
- -------- -----------------------------------------------------------------------
1.1+ Purchase Agreement, dated as of September 22, 1997, between the
Registrant and certain purchasers named therein and the form of Common
Stock Purchase Warrant attached thereto as Exhibit B.
4.1++ Certificate of Incorporation of Registrant
4.2++ Restated Bylaws of Registrant
4.3+++ Form of Common Stock Certificate
4.4+++ Preferred Shares Rights Agreement dated as of January 27, 1997, between
the Registrant and American Securities Transfer & Trust, Inc.,
including the Certificate of Designations, the Form of Rights
Certificate and the Summary of Rights attached thereto as Exhibit A,
Exhibit B and Exhibit C, respectively.
4.5+ Form of Common Stock Purchase Warrant (included in Exhibit 1.1)
5.1 Opinion of Wilson Sonsini Goodrich & Rosati, Professional Corporation
23.1 Consent of Ernst & Young, Independent Auditors
23.2 Consent of Wilson Sonsini Goodrich & Rosati, Professional Corporation
(included in Exhibit 5.1)
24.1 Power of Attorney (included on P. II-4)
- ---------------------------
+ Filed as exhibit 99.1 to the Registrant's Current Report on Form 8-K
filed with the Commission on September 24, 1997 and incorporated herein
by reference.
++ Filed as an exhibit to the Registrant's Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 and incorporated herein by
reference.
+++ Filed as an exhibit to the Registrant's Registration Statement on Form
S-1 (File No. 33-90746) and incorporated herein by reference.
++++ Filed as an Exhibit to the Registrant's Registration Statement on Form
8-A filed with the Commission on January 31, 1997 and incorporated
herein by reference.
II-5
Exhibit 5.1
September 22, 1997
VidaMed, Inc.
46107 Landing Parkway
Fremont, California 94538
Re: VidaMed, Inc. (the "Company") Registration Statement on Form S-3
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-3 to be filed
with the Securities and Exchange Commission (the "Registration Statement"), in
connection with the registration under the Securities Act of 1933, as amended,
of a shelf offering of (i) 2,517,652 shares of the Company's Common Stock, $.001
par value per share (the "Shares") and (ii) up to 629,413 shares of the
Company's Common Stock, $.001 par value per share, issuable upon exercise of
certain warrants to purchase Common Stock of the Company (the "Warrant Shares").
As your counsel, we have examined the proceedings proposed to be taken in
connection with the sale and issuance of the above-referenced securities.
It is our opinion that the Shares are, and that the Warrant Shares when
issued upon exercise of the warrants referred to in the Registration Statement
will be, legally and validly issued, fully paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement, including the Prospectus constituting a part thereof,
and any amendment thereto.
Very truly yours,
WILSON, SONSINI, GOODRICH & ROSATI
Professional Corporation
/s/ Wilson Sonsini Goodrich & Rosati
II-6
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3) and related Prospectus of VidaMed, Inc.
for the registration of 2,517,652 shares of its Common Stock and up to 629,413
shares of Common Stock issuable upon exercise of certain warrants to purchase
shares of Common Stock and to the incorporation by reference therein of our
report dated January 17, 1997, with respect to the consolidated financial
statements of VidaMed, Inc. incorporated by reference in its Annual Report (Form
10-K) for the year ended December 31, 1996, filed with the Securities and
Exchange Commission.
ERNST & YOUNG LLP
Palo Alto, California
September 19, 1997
II-7
