As filed the Securities and Exchange Commission on September 11, 1998
Registration No. 333-_______________
U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NORTH AMERICAN SCIENTIFIC, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 51-0366422
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
NORTH AMERICAN SCIENTIFIC, INC.
7435 GREENBUSH AVENUE
NORTH HOLLYWOOD, CA 91605
(818) 503-9201
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(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
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MR. L. MICHAEL CUTRER
NORTH AMERICAN SCIENTIFIC, INC.
7435 GREENBUSH AVENUE
NORTH HOLLYWOOD, CA 91605
(818) 503-9201
--------------
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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WITH COPIES OF COMMUNICATION TO:
STEPHEN M. COHEN ALLAN J. REICH
BUCHANAN INGERSOLL, P.C. D'ANCONA & PFLAUM
11 PENN CENTER, 14TH FLOOR 30 N. LASALLE STREET, SUITE 2900
1835 MARKET STREET CHICAGO, IL 60602
PHILADELPHIA, PA 19103 (312) 580-2000
(215) 665-8700
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Approximate date of commencement of proposed sale to the public: From time to
time after this registration statement is declared effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box: / /
<PAGE>
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 offer: / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: / /
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CALCULATION OF REGISTRATION FEE
(For calculation of the $180 registration fee, see table on following page)
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------- --------------------- -------------------- --------------------- --------------------
Proposed Maximum Proposed Maximum Amount
Offering Price per Aggregate Offering of
Title of Each Class of Amount to be Share Price Registration
Securities to be Registered Registered (1) Fee
- ------------------------------- --------------------- -------------------- --------------------- --------------------
<S> <C> <C> <C> <C>
Common Stock, $0.01 par value 75,000 $ 7.94 (2) $595,500 $ 180
per share
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TOTAL 75,000 $ 180
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</TABLE>
(1) To be sold by the Selling Stockholder.
(2) Estimated solely for the purpose of determining the Registration Fee.
Calculated pursuant to Rule 457(c), based upon the average of the high
and the low sales prices of the Registrant's Common Stock on September
4, 1998, as reported on the Nasdaq National Market System.
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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.
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.
<PAGE>
PRELIMINARY PROSPECTUS DATED SEPTEMBER 11, 1998
SUBJECT TO COMPLETION
NORTH AMERICAN SCIENTIFIC, INC.
75,000 SHARES OF COMMON STOCK
This Prospectus relates to the offer and sale by M.H. Meyerson & Co., Inc.
(the "Selling Stockholder") of up to 75,000 Shares (the "Shares") of the Common
Stock, par value $0.01 per share ("Common Stock"), of North American Scientific,
Inc., a Delaware corporation (the "Company"). 75,000 Shares of Common Stock are
issuable upon exercise of a warrant issued by the Company to the Selling
Stockholder in connection with an investment banking agreement (the "Warrant").
The Warrant was issued as of December 16, 1996 and may be exercised at $1.08 per
share through December 11, 2001. The Shares may be offered by the Selling
Stockholder in transactions on the Nasdaq National Market System ("NMS") or such
other markets upon which the Company may list shares of its Common Stock from
time to time, in privately negotiated transactions, or by 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 related to such prevailing market
prices or at negotiated prices. See "Plan of Distribution." The Company will
receive proceeds of up to $81,250 from the exercise of the Warrant. However, the
Company will receive none of the proceeds from the sale of the Shares by the
Selling Stockholder. See "Use of Proceeds."
The shares of Common Stock of the issuer are reported on the Nasdaq
National Market System under the symbol "NASI." The Selling Stockholder has
agreed to pay all of the expenses in connection with the registration and sale
of the Shares offered by the Selling Stockholder.
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK
AND SHOULD NOT BE PURCHASED BY INVESTORS WHO CANNOT AFFORD THE LOSS OF THEIR
ENTIRE INVESTMENT. SEE "RISK FACTORS" ON PAGE 4 FOR CERTAIN
CONSIDERATIONS RELEVANT TO AN INVESTMENT IN THESE SECURITIES.
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 75,000 Shares of Common Stock were issued by the Company pursuant to an
exemption from registration provided by the Securities Act of 1933, as amended.
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT
BE RELIED ON AS HAVING BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY, BY ANY PERSON
IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH OFFER
OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY OFFER,
SOLICITATION OR SALE MADE HEREUNDER, SHALL UNDER ANY CIRCUMSTANCES CREATE AN
IMPLICATION THAT THE INFORMATION THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THE DATE OF THE PROSPECTUS.
The date of this Prospectus is ______________, 1998
<PAGE>
AVAILABLE INFORMATION
The Company is a reporting company under Section 13 of the Securities and
Exchange Act of 1934 (the "Exchange Act").
The reports and other information filed by the Company may be inspected and
copied at the public reference facilities of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies may be obtained at the prescribed rates
from the Public Reference Section of the SEC at its principal office in
Washington, D.C. The Commission maintains a website that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the Commission. The address of the website is
http://www.sec.gov. Statements contained in this Prospectus as to the contents
of any contract or other document referred to are not necessarily complete, and,
in each instance, reference is made to the copy of such contract or other
document filed as an exhibit to the registration statement, each such statement
being qualified in all respects by such reference.
The Company has filed with the Commission a registration statement on Form
S-3 (together with any and all amendments, the "Registration Statement") under
the Securities Act of 1933, as amended, with respect to the registration of the
Common Stock. This Prospectus does not contain all of the information set forth
in the Registration Statement and the exhibits thereto, certain portions of
which have been omitted as permitted by the rules and regulations of the
Commission. In addition, certain documents filed by the Company, with the
Commission, have been incorporated herein by reference. See "Incorporation of
Certain Documents by Reference." For further information regarding the Company
and the Common Stock reference is made to the Registration Statement, including
the exhibits and schedules thereto and the documents incorporated herein by
reference.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference.
(a) Annual Report on Form 10-KSB for the fiscal year ended October 31,
1997;
(b) Proxy Statement on Schedule 14A as filed on March 2, 1998;
(c) Proxy Statement on Schedule 14C as filed on May 4, 1998;
(d) Quarterly Report on Form 10-QSB for the quarter ended July 31,
1998;
(e) Quarterly Report on Form 10-QSB for the quarter ended April 30,1998;
(f) Quarterly Report on Form 10-QSB for the quarter ended January 31,
1998;
(g) Current Reports on Form 8-K filed on February 9, 1998 and February 19,
1998, and
(h) The description of the Company's Common Stock as contained in the
Company's Form 10-SB dated August 21, 1995 and amended on October 20,
1995 and November 21, 1995.
All reports and other documents filed by the Company pursuant to Section
13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering made by the Prospectus
shall be deemed to be incorporated by reference herein. Any statement contained
in a document 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 incorporated or deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company undertakes to provide without charge to each person to whom a
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the information incorporated by reference in this Prospectus,
other than exhibits to such information. Requests for such copies should be
directed to Michael Silvestri, M. H. Meyerson & Co., Inc., 525 Washington Blvd.,
Jersey City, New Jersey 07310.
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<PAGE>
THE COMPANY
Through its wholly-owned subsidiary North American Scientific, Inc., a
California corporation, North American Scientific, Inc., a Delaware corporation
(the "Company"), manufactures and markets a broad line of low-level radiation
sources and standards for medical, scientific and industrial uses. The Company
currently operates in two principal business areas: (i) interstitial radioactive
brachytherapy sources, sometimes called "seeds", which are small, implantable
radioactive "pellets" used for the treatment of cancer and certain other
diseases, and (ii) radioactive "reference" sources, which are sealed devices
containing radioactive sources used to calibrate a variety of medical and
commercial equipment. The Company has been in the business of manufacturing
radioactive sources since 1990 and recently expanded its business strategy to
include the development of brachytherapy products. The Company entered into
agreements with Mentor Corporation, a Delaware corporation ("Mentor"), pursuant
to which Mentor distributes Iodine 125 ("I-125") brachytherapy seeds, which are
used in the treatment of prostate cancer, which are manufactured by the Company.
Additionally, through its relationship with RadioMed Corporation ("RadioMed"),
the Company is expanding its presence in the field of radioactive medical
devices by applying its expertise in radioactive source development and
RadioMed's expertise in ion implantation to identify and commercialize other
novel medical products and services. The Company was originally incorporated
under the Company Act of British Columbia, Canada, in 1987 and became a Delaware
corporation on April 20, 1995.
PRINCIPAL EXECUTIVE OFFICES
The principal executive offices of the Company are located at 7435
Greenbush Avenue, North Hollywood, CA 91605; its telephone number is (818)
503-9201.
RISK FACTORS
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF
RISK AND SHOULD BE CONSIDERED ONLY BY PERSONS WHO CAN AFFORD THE LOSS OF THEIR
ENTIRE INVESTMENT. EACH PROSPECTIVE INVESTOR SHOULD CAREFULLY CONSIDER THE
FOLLOWING RISK FACTORS INHERENT IN AND AFFECTING THE BUSINESS OF THE COMPANY AND
THIS OFFERING BEFORE MAKING AN INVESTMENT DECISION. THE FOLLOWING RISK FACTORS
SHOULD BE CONSIDERED CAREFULLY, IN ADDITION TO THE OTHER INFORMATION CONTAINED
IN THIS PROSPECTUS, IN EVALUATING THE COMPANY AND ITS BUSINESS PROSPECTS.
CERTAIN MATTERS DISCUSSED IN THIS PROSPECTUS ARE FORWARD LOOKING AS THAT TERM IS
DEFINED BY: (I) THE SECURITIES LITIGATION REFORM ACT OF 1995 (THE "1995 ACT"),
AND (II) RELEASES ISSUED BY THE SEC. THESE STATEMENTS ARE BEING MADE PURSUANT TO
THE PROVISIONS OF THE 1995 ACT AND WITH THE INTENTION OF OBTAINING THE BENEFITS
OF THE "SAFE HARBOR" PROVISIONS OF THE 1995 ACT. THE COMPANY CAUTIONS INVESTORS
THAT ANY FORWARD LOOKING STATEMENTS MADE BY THE COMPANY ARE NOT GUARANTEES OF
FUTURE PERFORMANCE AND THAT ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE IN
SUCH FORWARD LOOKING STATEMENTS AS A RESULT OF VARIOUS FACTORS, INCLUDING, BUT
NOT LIMITED TO, THE RISKS DETAILED HEREIN OR DETAILED FROM TIME TO TIME IN THE
COMPANY'S FILINGS WITH THE SEC.
EARLY STAGE OF PRODUCT COMMERCIALIZATION.
Certain of the Company's products are in an early stage of development and
commercialization. The Company's core business historically has involved the
manufacture and distribution of low-level radiation sources and reference
standards for use in medical imaging, environmental measurement and instrument
calibration procedures. However, the Company has recently begun to broaden its
line of products to include products involved in medical therapeutics. In
particular, the Company expects future revenues to be generated from sales of
its existing I-125 and proposed Palladium 103 ("Pd-103") brachytherapy sources,
both of which have received 510(k) clearance from the FDA. I-125 is being
marketed to physicians by Mentor under Mentor's trade name IOGOLD-TM-, and is
being used by physicians for the treatment of prostate cancer. The Company
received FDA approval for the Pd-103 brachytherapy product on July 2, 1998. The
success of the IOGOLD-TM- product will be
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dependent, to a large extent, on the efforts of Mentor, which is the exclusive
worldwide distributor of the product. The Company's long-term growth may be
significantly affected by whether it will be able successfully to market and
distribute the existing I-125 brachytherapy product, or other similar products
the Company may develop, to a large portion of the medical community. The
timeframe necessary to accomplish this objective may be long and uncertain, and
the development and production of additional medical therapeutic products,
including products utilizing Pd-103, may require even longer development and
clinical trial periods than the Company has experienced with the I-125
brachytherapy product. There can be no assurance that the Company's products in
development will prove to be safe and effective in clinical trials under
applicable regulatory guidelines, and clinical trials may identify significant
technical or other obstacles that must be overcome prior to obtaining necessary
regulatory or reimbursement approvals. There can be no assurance that the
Company will be able to manufacture a Pd-103 brachytherapy product at an
acceptable cost and appropriate quality, that the Company will be able to
develop other new products, obtain regulatory approval for such products in a
cost-effective manner or that the Company will be able to increase sales in its
target markets. Any failure by the Company to do so could have a material
adverse effect on the Company's business, operating results and financial
condition.
DEPENDENCE ON MARKETING ALLIANCE.
The Company has only limited experience marketing and selling its products,
and does not have experience marketing and selling its products in commercial
quantities. On June 16, 1997, the Company entered into a five-year marketing and
exclusive distribution agreement with Mentor, pursuant to which Mentor has begun
to market and distribute the Company's I-125 brachytherapy product under
Mentor's trade name IOGOLD-TM-. As a result, sales of the I-125 brachytherapy
product are dependent on the marketing efforts of Mentor. Mentor is marketing
IOGOLD-TM- through brachytherapy specialists as well as through its established
sales force, which is currently dedicated to sales of Mentor's existing urology
product line. This sales force intends to market the product to urologists and
radiation oncologists on a worldwide basis. In addition, Mentor also intends to
be actively involved in the education and training of physicians in the
procedures for the use of IOGOLD-TM-. Since the introduction of the product, the
Company has derived significant revenues from the sales of IOGOLD-TM-, and it
expects that sales of IOGOLD-TM- will continue to constitute a significant
percentage of its net sales in the foreseeable future. Any failure by Mentor to
successfully market IOGOLD-TM- or other products that are manufactured by the
Company and distributed by Mentor, or to successfully educate and/or train
physicians in the use of the product could have a material adverse effect on the
Company's sales of IOGOLD-TM- and consequently on the business, operating
results and financial condition of the Company. Subject to certain limitations,
Mentor also has the exclusive marketing and distribution rights to the Company's
Pd-103-based brachytherapy seeds. However, the Pd-103 product is under
development and no revenues have been received from its sale.
If the Company is unable to maintain its relationship with Mentor, or if
the Company introduces new products for which Mentor does not act as the
distributor, the Company may need to develop third party distribution channels
and/or its own direct sales force, which would be time consuming and require
significant resources, and there can be no assurance that the Company would be
successful. The Company's failure to do so could have a material adverse effect
upon its business, operating results and financial condition. In the event that
Mentor fails to achieve certain performance targets in specified territories,
the Company may terminate Mentor's exclusive distribution rights in such
territory or territories, in which case Mentor may have the right to
independently manufacture and distribute the I-125 based brachytherapy product.
The loss of the Mentor relationship could also result in the Company's inability
to market its I-125 brachytherapy products under the IOGOLD-TM- trade name. Any
such inability could also have a material adverse effect on the Company's
business, operating results and financial condition.
UNCERTAINTY OF MARKET ACCEPTANCE OF BRACHYTHERAPY SOURCES.
Ultrasound guided transperineal seeding, currently the most prevalent
seeding technique practiced by physicians, is a relatively new treatment method
for prostate cancer which currently has a lower level of market penetration than
radical prostatectomy ("RP"). There can be no assurance that brachytherapy will
gain significant market acceptance among physicians, patients and health care
payors. The success of the Company's existing I-125 and proposed Pd-103
brachytherapy products will depend on maintaining and increasing favorable
perceptions by
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patients, doctors, health care payors and medical researchers regarding the
safety, efficacy and cost effectiveness of the product. Management believes that
recommendations by physicians and health care payors will be essential to
increase market acceptance of seeding, and there can be no assurance that any
such recommendations will be obtained. Physicians in the U.S. or elsewhere will
not recommend seeding unless they individually conclude, based on clinical data
and other factors, that it is an attractive alternative to traditional methods
of prostate cancer treatment, of which RP and external beam radiation therapy
("EBRT") are the most commonly used. RP has a long history as the treatment of
choice for early-stage, localized prostate cancer, and many physicians have been
trained in this procedure. EBRT has experienced some negative results, which
could create an unfavorable public perception of radiation treatment for
prostate cancer in general, and could adversely affect public acceptance of
seeding. In addition, although Mentor has been granted worldwide distribution
rights to the Company's I-125 brachytherapy sources to be marketed under
Mentor's trade name IOGOLD-TM-, physicians in many countries, including most
European countries, do not currently aggressively treat prostate cancer. The
failure of the brachytherapy technique in general, or of IOGOLD-TM- in
particular, to gain acceptance among physicians, patients and/or health care
payors in the U.S. or elsewhere could have a material adverse effect on the
business, operating results and financial condition of the Company.
MARKET PRICE FLUCTUATIONS.
The Company has recently experienced significant variability in the market
price and the trading volume of its Common Stock. In addition, the securities
markets from time to time experience significant price and volume fluctuations
that may be unrelated to the operating performance of particular companies.
Announcements of delays in the Company's testing and development schedules,
technological innovations or new product introductions by the Company or its
competitors, developments or disputes concerning patents or proprietary rights,
regulatory developments in the U.S. and foreign countries, public concern as to
the safety of products containing radioactive compounds and economic and other
external factors, as well as period-to-period fluctuations in the Company's
financial results, may have a significant impact on the market price of the
Common Stock and the Company may experience further volatility in the market
price and trading volume of the Common Stock.
MANAGEMENT OF GROWTH.
The Company's business has grown significantly over the past several years.
However, there can be no assurance that the Company will continue to grow. If
growth does occur, there can be no assurance the Company will be effective in
managing such future growth, in expanding its facilities and operations or in
retaining additional qualified personnel. In particular, the Company has
significantly increased its production capacity in order to produce IOGOLD-TM-.
This expansion of production capacity has included the leasing of a new
production facility and a significant increase in the number of employees
dedicated to that production. Furthermore, pursuant to the Company's agreements
with RadioMed, the Company has established an ion implantation facility at the
Company's North Hollywood, California location. Any failure to effectively
manage growth, expand its operations or attract and retain qualified personnel
to meet such growth could have a material adverse effect on the Company's
business, operating results and financial condition.
FLUCTUATIONS IN QUARTERLY OPERATING RESULTS.
The Company's results of operations have historically varied from quarter
to quarter and the Company expects that further variability may continue to
occur and may be significant. In the past, operating results have varied as a
result of a number of factors, including the size and timing of customer orders,
the timing of the introduction and customer acceptance of new products or
product enhancements by the Company or its competitors, changes in pricing
policies by the Company or its competitors, research and development
expenditures, certain non-operational expenses (including litigation costs) and
changes in general economic conditions. Future variability in the Company's
results of operations may result from the changes in the Company's business
disclosed in this Prospectus, in particular due to continued sales of
IOGOLD-TM-through the Company's relationship with Mentor.
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COMPETITION.
The radiation source industry is highly competitive. The Company competes
with several national and international companies which are substantially larger
and have greater technical, sales, marketing and financial resources than the
Company. The Company has no experience in human therapeutic products and
competes against companies with greater experience in this sector. Developments
by any of these companies or advances by medical researchers at universities,
government research facilities or private research laboratories could render the
Company's products obsolete. Furthermore, since the introduction of IOGOLD-TM
certain companies have announced their intention to develop I-125 brachytherapy
products, and if demand for treatment of prostate cancer increases, additional
companies with substantially greater financial resources than the Company, as
well as extensive experience in research and development, the regulatory
approval process and manufacturing and marketing, may develop seeding treatments
and products that are similar to the Company's I-125 brachytherapy product.
There can be no assurance that such future competition will not have a material
adverse effect on the Company's business, operating results and financial
condition. In addition to competition from other manufacturers of I-125 based
products, products using alternative technologies, including Pd-103, may
continue to be developed which will compete with the Company's existing and
proposed products.
DEPENDENCE ON KEY CUSTOMERS.
Two of the Company's customers accounted for 71% of the Company's total
revenues in fiscal 1997. Significant customers may continue to account for a
substantial percentage of the Company's sales in both its reference source and
brachytherapy source businesses in the future. In particular, the Company
expects that Mentor will continue to be a significant customer in the future
through the distribution of the IOGOLD-TM-product. There can be no assurance
that any of such customers will maintain their volume of business with the
Company. A loss of the Company's sales to such customers could have a material
adverse effect on the Company's business, operating results and financial
condition.
EFFECT OF REIMBURSEMENT POLICIES.
A substantial percentage of the patients treated for prostate cancer in the
U.S. are covered by Medicare, and, consequently, the costs of prostate cancer
treatment are subject to Medicare's prescribed rates of reimbursement. Medicare
reimbursement amounts for seeding are currently significantly less than for RP.
Although seeding requires less physician time than RP, reimbursement amounts,
when combined with physician familiarity with RP, may provide disincentives for
urologists to perform seeding. There can be no assurance that (i) current or
future limitations or requirements for reimbursement by Medicare or other third
party payors for prostate cancer treatment will not materially adversely affect
the market for the IOGOLD-TM- product, (ii) health administration authorities
outside the U.S. will provide reimbursement at acceptable levels or at all or
(iii) any such reimbursement will continue at rates that enable the Company to
maintain prices at levels sufficient to realize an appropriate return. The
non-occurrence of any such factors could have a material adverse effect on the
business, operating results and financial condition of the Company.
GOVERNMENT REGULATION.
The manufacture and sale of the Company's products are subject to stringent
government regulation in the U.S. and other countries. FDA and other
governmental approvals and clearances are subject to continual review, and later
discovery of previously unknown problems may result in restrictions on a
product's marketing or withdrawal of the product from the market. The commercial
distribution in the U.S. of any new products developed by the Company will be
dependent upon obtaining the prior approval or clearance of the FDA, which can
take many years and entail significant costs. The Company has received 510(k)
clearance from the FDA with respect to the IOGOLD-TM- product and for a
Pd-103-based brachytherapy seed. In countries where the Company's products are
not currently approved, the use or sale of the Company's products may require
approval by government agencies comparable to the FDA. The process of obtaining
such approvals may be lengthy, expensive and uncertain. There can be no
assurance that the necessary approvals for the marketing of the Company's
products in other markets will be obtained on a timely basis or at all. The
Company is also required to adhere to applicable FDA regulations for
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current Good Manufacturing Practices ("GMP"), including extensive record keeping
and reporting and periodic inspections of its manufacturing facilities. Similar
requirements are imposed by governmental agencies in other countries.
The Company's manufacturing operations involve the manufacturing and
processing of radioactive materials, which are subject to stringent regulation.
The Company operates under a license issued by the California Department of
Health which is renewable every eight years. California is one of the "Agreement
States" which are so named because the U.S. Nuclear Regulatory Commission (the
"NRC") has granted such states regulatory authority over radioactive material
manufacturers, provided such states have regulatory standards meeting or
exceeding the standards imposed by the NRC. The users of the Company's
IOGOLD-TM- product are required to possess licenses issued by the state in which
they reside (if such states are Agreement States) or the NRC. Use licenses are
also required by some of the foreign jurisdictions in which the Company may seek
to market its products. There can be no assurance that current licenses held by
the Company for its manufacturing operations will remain in force or that
additional licenses required for the Company's operations will be issued. There
also can be no assurance that the Company's customers will receive or retain the
radioactive materials licenses required to possess and use the Company's
products, including IOGOLD-TM-, or that delays in the granting of such licenses
will not hinder the Company's ability to market its products. Furthermore,
regulation of the Company's radioactive materials manufacturing processes
involves the imposition of financial requirements related to public safety and
decommissioning, and there are high costs and regulatory uncertainties
associated with the disposal of radioactive waste generated by the Company's
manufacturing operations. There can be no assurance that the imposition of such
requirements and the costs and regulatory restrictions associated with disposal
of waste will not adversely affect the Company's business, operating results and
financial condition.
Any failure to obtain and maintain regulatory approvals, licenses and
permits could significantly delay the Company's marketing efforts. Furthermore,
changes in or interpretations of existing regulations, or the adoption of new
restrictive regulations, could adversely affect either the obtaining or timing
of future regulatory approvals. Failure to comply with applicable regulatory
requirements could result in, among other things, significant fines, suspension
of approvals, seizures or recalls of products, operating restrictions or
criminal prosecution and could materially adversely affect the Company's
business, operating results and financial condition.
NEED FOR FUTURE CAPITAL.
The Company's capital requirements have been and are expected to continue
to be significant. In particular, significant funds have been and will continue
to be necessary to fund expansion of the IOGOLD-TM-product and to set up a
manufacturing capability for the production of ion implantation devices pursuant
to the Company's manufacturing and supply agreement with RadioMed. In addition,
significant funds are also expected to be required to fund the establishment of
production capacity for Pd-103 seeds. Following the Company's 1997 Private
Placement of securities, management believes the Company's existing capital
resources and future operating cash flows, will be sufficient to fund the
Company's planned expansion over the next 24 months. However, the Company may
require further capital for the purchase of complementary businesses,
technologies or products. The Company's capital requirements will depend on
numerous factors, including the time and cost involved in expanding production
capacity, the cost involved in protecting the proprietary rights of the Company
and the time and expense involved in obtaining required regulatory approval to
market IOGOLD-TM- in new markets or similar approvals for new products,
including Pd-103 based products, the Company may develop.
INTELLECTUAL PROPERTY RIGHTS; DEPENDENCE ON TRADE SECRETS.
The Company's success will depend, in part, on its ability to obtain,
assert and defend patent rights, protect trade secrets and operate without
infringing the proprietary rights of others. The Company holds rights to an
issued U.S. patent on a radioisotope-based device for site localization during
biopsy procedures. In addition, the Company has applied for a U.S. patent on a
radioactive brachytherapy source using multiple markers. There can be no
assurance that rights under patents held by or licensed to the Company will
provide it with competitive advantages or that others will not independently
develop similar products or design around or infringe the patents or
8
<PAGE>
other proprietary rights owned by or licensed to the Company. In addition, there
can be no assurance that any patent obtained or licensed by the Company will be
held to be valid and enforceable if challenged by another party.
There can be no assurance that patents have not been issued or will not be
issued in the future that conflict with the Company's patent rights or prevent
the Company from marketing its products. Such conflicts could result in a
rejection of the Company's or its licensors' patent applications or the
invalidation of patents, which could have a material adverse effect on the
Company's business, operating results and financial condition. In the event of
such conflicts, or in the event the Company believes that competitive products
infringe patents to which the Company holds rights, the Company may pursue
patent infringement litigation or interference proceedings against, or may be
required to defend against litigation or proceedings involving, holders of such
conflicting patents or competing products. There can be no assurance that the
Company will be successful in any such litigation or proceeding, and the results
and cost of such litigation or proceeding may materially adversely affect the
Company's business, operating results and financial condition. In addition, if
patents that contain dominating or conflicting claims have been or are
subsequently issued to others, and such claims are ultimately determined to be
valid, the Company may be required to obtain licenses under patents or other
proprietary rights of others. No assurance can be given that any licenses
required under any such patents or proprietary rights would be made available on
terms acceptable to the Company, if at all. If the Company does not obtain such
licenses, it could encounter delays or could find that the development,
manufacture or sale of products requiring such licenses is foreclosed.
The Company relies to a significant degree on trade secrets, proprietary
know-how and technological advances that are either not patentable or that the
Company chooses not to patent. The Company seeks to protect non-patented
proprietary information, in part, by confidentiality agreements with suppliers,
employees and consultants. There can be no assurance that these agreements will
not be breached, that the Company would have adequate remedies for any breach,
or that the Company's trade secrets and proprietary know-how will not otherwise
become known or be independently discovered by others. The disclosure to third
parties of proprietary non-patented information could have a material adverse
effect on the Company's business, operating results and financial condition.
DEPENDENCE ON KEY PERSONNEL.
The success of the Company is largely dependent on the personal efforts of
key technical and senior management personnel, principally L. Michael Cutrer,
its President and Chief Executive Officer. The Company does not have an
employment agreement with Mr. Cutrer. The Company believes that its future
success will depend in large part upon its ability to attract and retain
highly-skilled technical, managerial and marketing personnel and is likely to
require the further expansion of its management level personnel. Competition for
radiation source industry personnel can be intense, and the availability of
capable personnel may be limited; thus, their services could be difficult to
obtain or replace. There can be no assurance that the Company will be successful
in attracting and retaining the personnel it requires to develop and market new
and enhanced products and to conduct its operations successfully. Any inability
to attract and retain such personnel could have a material adverse effect on the
Company's business, operating results and financial condition.
RAPID TECHNOLOGICAL CHANGE.
The markets for the Company's products are characterized by ongoing
technological developments, evolving industry standards and rapid changes in
customer requirements. The Company's success depends on its ability to continue
to enhance its existing product lines, to develop and introduce in a timely
manner new products that take advantage of technological advances and to respond
promptly to customers' requirements. There can be no assurance that the
Company's current level and scope of research and development spending will be
adequate, that the Company will be successful in developing and marketing
enhancements to its existing products or new products on a timely basis, or that
its new products will adequately address the changing needs of the marketplace.
Failure by the Company in any of these areas could materially and adversely
affect the Company's business, operating results and financial condition.
9
<PAGE>
LIMITED NUMBER OF SUPPLIERS.
The Company is dependent upon a limited number of outside unaffiliated
suppliers for its radioisotopes. The Company's principal suppliers are Nordion
International, Inc. and the Los Alamos National Laboratory. The Company also
utilizes overseas isotope manufacturers. To date, the Company has generally been
able to obtain the required radioisotopes for its products as needed. The
Company believes that it will be able to continue to obtain required
radioisotopes from these or other sources, although there can be no assurance
thereof. The delay or unavailability of radioisotopes could have a material
adverse effect on the Company's production and sales levels and consequently
upon its business, operating results and financial condition.
PRODUCTS LIABILITY; INSURANCE COVERAGE.
The Company's business is subject to product liability risks inherent in
the testing, manufacturing and marketing of products containing radioisotopes.
To date, no product liability claims have been asserted against the Company.
However, there can be no assurance that such claims will not arise in the future
based on past, present or future services or products offered by the Company.
The Company maintains product liability and general liability insurance. The
Company's product liability and general liability policy is provided on a claims
made basis and is subject to annual renewal. There can be no assurance that
liability claims will not exceed the scope of coverage or limits of such
policies or that such insurance will continue to be available on commercially
reasonable terms or at all. If the Company does not or cannot maintain
sufficient liability insurance, its ability to market its products may be
significantly impaired. In addition, product liability claims, as well as
negative publicity arising out of such claims, could have a material adverse
effect on the business, operating results and financial condition of the
Company.
HAZARDOUS MATERIALS.
The Company's manufacturing processes and research and development efforts
involve the controlled use of hazardous materials. Although the Company believes
that its safety procedures for handling and disposing of such materials comply
with the standards prescribed by state and federal regulations, the risk of
accidental contamination or injury from these materials cannot be completely
eliminated. In the event of such an accident, the Company could be held liable
for any damages that result, and any such liability could have a material
adverse effect on the Company's business, operating results and financial
condition.
UNCERTAINTY RELATED TO HEALTH CARE REFORM.
Political, economic and regulatory influences are subjecting the health
care industry in the United States to fundamental change. The Company
anticipates that Congress, state legislatures and the private sector will
continue to review and assess alternative health care delivery and payment
systems. Potential approaches that have been considered include mandated basic
health care benefits, controls on health care spending through limitations on
the growth of private purchasing groups, price controls and other fundamental
changes to the health care delivery system. Legislative debate is expected to
continue in the future, and market forces are expected to demand reduced costs.
The Company cannot predict what impact the adoption of any federal or state
health care reform measures, future private sector reform or market forces may
have on its business, operating results and financial condition.
10
<PAGE>
EFFECT OF CERTAIN STATUTORY, CHARTER AND BYLAW PROVISIONS; AUTHORIZATION AND
DISCRETIONARY ISSUANCE OF PREFERRED STOCK.
Certain provisions of the Company's Certificate of Incorporation and Bylaws
could delay the removal of incumbent directors and could make more difficult a
merger, tender offer or proxy contest involving the Company, even if such events
would be beneficial to the interests of the stockholders. For example, the
Company is currently authorized to issue 2,000,000 shares of Preferred Stock,
par value $.01 per share ("Preferred Stock"), without any vote or further action
by the Company's stockholders. The Preferred Stock, no shares of which are
currently outstanding, is issuable in one or more series with such rights,
preferences, maturity dates and similar matters as the Board of Directors of the
Company may from time to time determine. The Company is also subject to Section
203 of the Delaware General Corporation law which, subject to certain
exceptions, prohibits a Delaware corporation from engaging in a broad range of
business ventures with any "interested stockholder" for a period of three years
from the date such stockholder became an interested stockholder.
DIVIDEND POLICY.
The Company has not paid any cash dividends on its Common Stock and does
not expect to declare or pay any cash dividends in the foreseeable future.
YEAR 2000 COMPLIANCE.
The Year 2000 issues arises from the fact that most computer software
programs have been written using two digits rather than four to represent a
specific year. Any computer programs that have date-sensitive software may
recognize a date using "00" as the year 1900 rather than the year 2000. This
could result in a system failure or miscalculation causing disruption of
operations, including among other things, a temporary inability to process
transactions, send invoices or engage in similar normal business activities.
Based on a recent assessment, the Company believes that it will not be required
to modify or replace significant portions of its software in order to address
its Year 2000 issue. The Company is initiating formal communications with its
significant suppliers and large customers to determine the extent to which the
Company is vulnerable to those third parties' failure to remediate their Year
2000 issue. The Company has so far received no indication that its, or any
material third party's, systems will not be Year 2000 compliant. Consequently,
the Company does not expect the Year 2000 issue to be material to the Company.
However, there can be no assurance that the systems of other companies will be
converted timely, or that a failure to convert by another company, or a
conversion that is incompatible with the Company's systems would not have a
material adverse effect on the Company.
USE OF PROCEEDS
The Company will receive proceeds of up to $81,250 from the exercise of the
Warrant. However, the Company will receive none of the proceeds from the sale of
the Shares by the Selling Stockholder. Any proceeds received in connection with
the exercise of the Warrant are expected to be used for general corporate
purposes.
11
<PAGE>
SELLING STOCKHOLDER
The following table sets forth certain information regarding the beneficial
ownership of Common Stock as of August 1, 1998. The Selling Stockholder does not
hold any position or office, and has not had any other material relationship
with the Company or any of its predecessors or affiliates within the last three
years, except as follows: On December 11, 1996, the Selling Stockholder entered
into a letter agreement with the Company relating to the provision of investment
banking services (the "Letter Agreement"). In connection with such services, the
Selling Stockholder received the Warrant. The Warrant is exercisable at $1.08
per share until December 2001. The Warrant was initially exercisable for an
aggregate of 225,000 (on a post-split basis) shares of Common Stock. Meyerson
previously exercised its rights under the Warrant to purchase 150,000 (on a
post-split basis) shares of Common Stock and these shares were covered by a
prior registration statement on Form S-3. The Warrant is currently exercisable
in full for the remaining 75,000 shares.
<TABLE>
<CAPTION>
Beneficial Ownership Beneficial Ownership
Prior to Offering(1) Post Offering
-------------------- --------------------
Number of Shares Being Number of
Name Shares Percent Offered Shares Percent
----- --------- ------- ------- --------- -------
<S> <C> <C> <C> <C> <C>
M.H. Meyerson & Co., Inc. 75,000 1.1 75,000 0 0
------ ------
Total 75,000 1.1 75,000 0 0
====== ======
</TABLE>
- ------------------
(1) The Company believes that the Selling Stockholder has sole voting and
investment power with respect to all shares of Common Stock reflected
as being owned by such Selling Stockholder. The shares shown in this
table consist of 75,000 shares issuable upon execise of the Warrant.
PLAN OF DISTRIBUTION
All of the Shares of Common Stock being offered hereby are being sold by
the Selling Stockholder and were acquired pursuant to the Letter Agreement. An
aggregate of 75,000 Shares of Common Stock may be offered and sold pursuant to
this Prospectus by the Selling Stockholder. The Selling Stockholder will pay all
expenses in connection with the registration of the Shares offered hereby. Such
Shares have been included in the Registration Statement of which this Prospectus
forms a part.
The 75,000 shares of Common Stock being offered by the Selling Stockholder
pursuant to this Prospectus may be offered and sold from time to time as market
conditions permit on the Nasdaq National Market System or such other markets
upon which the Company may list shares of its Common Stock from time to time, at
prices and terms then prevailing or at prices related to the then current market
price, or in negotiated transactions. The Shares may be sold by one or more of
the following methods, without limitations: (a) a block trade in which a broker
or dealer so engaged will attempt to sell the shares as agent but may position
and resell a portion of the block as principal to facilitate the transaction;
(b) purchases by a broker or dealer as principal and resale by such broker or
dealer for its account pursuant to this Prospectus; (c) ordinary brokerage
transactions and transactions in which the broker solicits purchasers; and (d)
face-to-face transactions between sellers and purchasers without a
broker/dealer. In effecting sales, brokers or dealers engaged by the Selling
Stockholder may arrange for other brokers or dealers to participate. Such
brokers or dealers may receive commissions or discounts from the Selling
Stockholder in amounts to be negotiated. Such brokers and dealers and any other
participating brokers and dealers may be deemed to be "Underwriters" within the
meaning of the Securities Act in connection with such sales.
To comply with certain states' securities laws, if applicable, the shares
of Common Stock registered hereunder will be offered or sold in such
jurisdictions only through registered or licensed brokers or dealers. In
addition, in certain states the Shares may not be sold or offered unless they
have been registered or qualified for sale in such states or an exception for
registration or qualification is available and is complied with.
12
<PAGE>
LEGAL MATTERS
The legality of the securities offered hereby will be passed upon for the
Company by D'Ancona & Pflaum. Attorneys of D'Ancona & Pflaum hold an aggregate
of 72,850 shares of Common Stock of the Company.
EXPERTS
The consolidated financial statements of the Company and its subsidiary,
incorporated by reference in this Prospectus and Registration Statement by
reference to the Annual Report on Form 10-KSB for the year ended October 31,
1997 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, as set forth in their
report thereon, and are included in reliance upon such report given upon the
authority of said firm as experts in accounting and auditing.
13
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses which will be paid by the Company in connection
with this offering are as follows:
SEC Registration.......................................$ 180
*Legal Fees and Expenses................................$10,000
*Blue Sky Fees and Expenses.............................$ --
*Accounting Fees and Expenses...........................$ 5,000
Miscellaneous..........................................$ 1,000
-------
TOTAL..................................................$16,180
- ------------------------
*Indicates expenses that have been estimated for the purpose of filing.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 102(b)(7) of the General Corporation Law of Delaware ("Delaware Law")
enables a corporation in its original certificate of incorporation or an
amendment thereto to eliminate or limit the personal liability of a director to
duty, except (i) for any breach of a director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii)
pursuant to Section 174 of the Delaware Law (providing for liability of
Directors for unlawful payment of dividends or unlawful stock purchases or
redemptions), or (iv) for any transaction from which a director derived an
improper personal benefit. The Certificate of Incorporation of the Company, as
amended, provides in effect for the elimination of the liability of directors to
the extent permitted by Delaware Law.
Section 145 of the Delaware Law provides, in summary, that directors and
officers of Delaware corporations are entitled, under certain circumstances, to
be indemnified against all expenses and liabilities (including attorney's fees)
incurred by them as a result of suits brought against them in their capacity as
a director or officer, if they acted in good faith an in a manner they
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, if they had
no reasonable cause to believe their conduct was unlawful; provided, that no
indemnification may be made against expenses in respect of any claim, issue or
matter as to which they shall have been adjudged to be liable to the
corporation, unless and only to the extent that 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, they
are fairly and reasonably entitled to indemnity for such expenses which the
court shall deem proper. Any such indemnification may be made by the corporation
only as authorized in each specific cased upon a determination by the
stockholders or disinterested directors that indemnification is proper because
the indemnitee has met the applicable standard of conduct. The Company's By-laws
entitle officers and directors of the Company to indemnification to the fullest
extent permitted by Delaware Law.
II-1
<PAGE>
ITEM 16. EXHIBITS
Exhibits Description of Documents
4.1 Certificate of Incorporation of the Registrant, incorporated by
reference to Exhibit 4.1 of the Registrant's Registration
Statement on Form 10-SB, filed August 22, 1995.
4.2 Certificate of Amendment of the Registrant, incorporated by
reference to Exhibit 3.1 of the Registrant's Quarterly Report on
Form 10-QSB for the quarterly period ended July 31, 1998.
4.3 Bylaws of the Registrant, incorporated by reference to
Exhibit 4.1 of the Registrant's Registration Statement on Form
10-SB, filed August 22, 1995.
4.4 Investment Banking Agreement dated November 13, 1997 between the
Registrant and M.H. Meyerson & Co., Inc., incorporated by
reference to Exhibit 10.4 to the Registrant's Annual Report on
Form 10-KSB for the fiscal year ended October 31, 1996.
5 Opinion of D'Ancona & Pflaum on legality of securities being
registered.
23.1 Consent of D'Ancona & Pflaum (included in Exhibit 5).
23.2 Consent of PricewaterhouseCoopers LLP
24 Power of Attorney (included on page II-4)
ITEM 17. UNDERTAKINGS
A Rule 415 Offering
The undersigned Company 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 1933 Act; (ii) to reflect in the
prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the
information set forth in the registration statement; (iii) to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) For the purpose of determining any liability under the 1933 Act, each
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
II-2
<PAGE>
B. Indemnification
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended, may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions described under Item 15
above, 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 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 of 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 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.
C. Filings Incorporating Subsequent Exchange Act Documents by Reference
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 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of 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 North Hollywood, State of California on the 11th
day of September, 1998.
North American Scientific, Inc.
By: /s/ L. Michael Cutrer
-------------------------
L. Michael Cutrer
President, Chief Executive Officer and
Director
KNOW ALL MEN BY THESE PRESENT, that each person whose signature appears below
constitutes and appoints L. Michael Cutrer and Alan I. Edrick, and each of their
true and lawful attorneys-in-fact and agents, 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, granting unto said attorneys-in-fact and agents, full power and
authority to do and perform each and every act and thing requisite or necessary
to be done in and about the premises, as full to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or either of them or their or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities indicated on this 11th day of September, 1998.
Signature Title
/s/ Irwin J. Gruverman
- -------------------------------- Chairman of the Board of Directors
Irwin J. Gruverman
/s/ L. Michael Cutrer President, Chief Executive Officer and
- -------------------------------- Director (Principal Executive Officer)
L. Michael Cutrer
/s/ Larry Berkin Director
- --------------------------------
Larry Berkin
/s/ Dr. Allan M. Green Director
- --------------------------------
Dr. Allan M. Green
/s/ Michael C. Lee Director
- --------------------------------
Michael C. Lee
/s/ Alan I. Edrick
- -------------------------------- Chief Financial Officer (Principal
Alan I. Edrick Financial and Accounting Officer)
II-4
EXHIBIT 5.1
September 10, 1998
North American Scientific, Inc.
7435 Greenbush Avenue
North Hollywood, CA 91605
Gentlemen:
In connection with the proposed registration under the Securities Act of
1933, as amended, by North American Scientific, Inc., a Delaware corporation
(the "Company"), of 75,000 shares of its Common Stock, $.01 par value per share
(the "Shares"), pursuant to the Company's registration statement on Form S-3 of
even date herewith (the "Registration Statement"), we hereby advise you that as
counsel for the Company we have examined the Certificate of Incorporation of the
Company and all amendments thereto, the By-Laws of the Company, as amended,
certain minutes of the Company, and such other documents and records as we have
deemed necessary for the purposes of this opinion.
Based upon such examination, it is our opinion that the Shares have been
duly authorized, and when issued pursuant to the terms of the common stock
purchase warrants relating thereto, will be legally issued, fully paid and
nonassessable.
We hereby consent to the reference to our firm under the heading "Legal
Matters" in the Prospectus of the Company included in the Registration Statement
and to the filing of this opinion as an exhibit to said Registration Statement.
Very truly yours,
D'ANCONA & PFLAUM
By: /s/ Steve Curtis
---------------------------
Steve Curtis
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
January 19, 1998 appearing on page F-1 of North American Scientific, Inc.'s
Annual Report on Form 10-KSB for the ended October 31, 1997. We also consent to
the reference to us under the heading "Experts" in such Prospectus.
/s/ PricewaterhouseCoopers LLP
- ------------------------------
PRICEWATERHOUSECOOPERS LLP
Costa Mesa, California
September 8, 1998
