As filed with the Securities and Exchange Commission on January 28, 1999
Registration No. 333-69179
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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BIOTIME, INC.
(Exact name of Registrant as specified in charter)
----------------
California 94-3127919
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
935 Pardee Street
Berkeley, California 94710
(510) 845-9535
(Address, including zip code,
and telephone number, including area code,
of Registrant's principal executive offices)
Paul E. Segall, Chief Executive Officer
BioTime, Inc.
935 Pardee Street
Berkeley, California 94710
(510) 845-9535
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------
Copies of all communications, including all communications
sent to the agent for service, should be sent to:
RICHARD S. SOROKO, ESQ.
Lippenberger, Thompson, Welch, Soroko & Gilbert LLP
250 Montgomery Street, Suite 500
San Francisco, California 94104
Tel. (415) 421-5300
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Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes 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. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 of 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. [ ]
(Continued on next page.)
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(Continued from front cover.)
CALCULATION OF REGISTRATION FEE
==============================================================================================================
Proposed Proposed
Amount Maximum Maximum Amount of
Title of Each Class of Securities to be Offering Price Aggregate Registration
to be Registered Registered Per Unit(1) Offering Price(1) Fee
- --------------------------------------------------------------------------------------------------------------
Common Shares, no par value(2) ......... 501,629 $12.34 $6,190,101.86 $ 1,826.08(3)
- --------------------------------------------------------------------------------------------------------------
Common Share Subscription Rights ...... 10,032,579 -- -- --
- --------------------------------------------------------------------------------------------------------------
Common Shares, no par value(2) ......... 25 $16.50 $ 412.50 $ .12(4)
- --------------------------------------------------------------------------------------------------------------
Common Share Subscription Rights ...... 500 -- -- --
- --------------------------------------------------------------------------------------------------------------
Common Shares, no par value(5) ......... 250,000 $12.34 $3,085,000.00 $ 910.08(3)
- --------------------------------------------------------------------------------------------------------------
Total Registration Fee ............................................................... $ 2,736.28
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(1) Estimated solely for the purpose of calculating the registration fee.
(2) Issuable upon exercise of the Common Share Subscription Rights.
(3) Previously paid.
(4) Paid herewith.
(5) Issuable to fill excess over-subscriptions.
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.
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PROSPECTUS
[GRAPHIC OMITTED]
BIOTIME, INC.
501,654 COMMON SHARES
Issuable Upon the Exercise of Subscription Rights
BioTime, Inc. is issuing new securities called "Rights." Holders of the
Rights will be entitled to purchase up to an aggregate of 501,654 BioTime common
shares. You will receive Rights from BioTime if you owned BioTime shares as of
the close of business on January 5, 1999, which has been set as the record date.
If your shares were held in the name of Cede & Co. as nominee for The Depository
Trust Company, or in the name of any other depository or nominee, on the record
date, you will also receive Rights. You will receive one Right for each common
share that you owned on the record date. The Rights will entitle you to
subscribe for and purchase one new common share for every 20 Rights you hold.
The subscription price is $_____________ per share.
The Rights will expire at 5:00 p.m. New York City time on __________, 1999.
By exercising your Rights, you will be able to purchase BioTime shares at
a price below market, without incurring broker's commissions. By
over-subscribing, you may be able to purchase any shares that are left over by
shareholders who fail to exercise their Rights. BioTime may also issue up to
250,000 additional shares to fill over-subscriptions.
The common shares are authorized for trading on the Nasdaq National Market
under the symbol BTIM. The Rights will be transferable and are expected to be
approved for trading on the Nasdaq SmallCap Market under the symbol BTIMR.
----------------
These securities involve a high degree of risk and should be purchased only by
persons who can afford the loss of their entire investment. See "Risk Factors"
on page 7.
----------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is
a criminal offense.
================================================================================
Price to Proceeds to the
the Public Company(1)
- --------------------------------------------------------------------------------
Per Share ................................... $ $
- --------------------------------------------------------------------------------
Total(2) .................................... $ $
================================================================================
(1) Before deducting expenses of the Rights offer which are estimated to be
$115,000. No underwriting discounts or commissions will be paid.
(2) Assumes all of the Rights are exercised. Does not include any proceeds that
may be received if additional common shares are issued to fill
over-subscriptions.
The date of this prospectus is January ______, 1999
[This Page Intentionally Left Blank]
PROSPECTUS SUMMARY
The following summary explains only some of the information in this
prospectus. More detailed information about BioTime and the Rights offer, and
financial statements appear elsewhere in this prospectus or in the documents
incorporated by reference into this prospectus. Statements contained in this
prospectus that are not historical facts may constitute forward-looking
statements that are subject to risks and uncertainties that could cause actual
results to differ materially from those discussed. See "Risk Factors."
The Company
BioTime is developing aqueous based synthetic solutions that can be used
as blood plasma volume expanders, blood replacement solutions during
hypothermic (low temperature) surgery, and organ preservation solutions. Plasma
volume expanders are used to treat decreased blood volume resulting from blood
loss in surgical or trauma patients. We are developing products that may be
used in large volumes, even when blood loss becomes so severe that a
transfusion of packed red blood cells or other blood products is required. We
are also developing a specially formulated hypothermic blood replacement
solution that would be used for the replacement of a patient's circulating
blood volume during cardiac surgery, neurosurgery and other surgeries that
involve lowering the patient's body temperature.
Our first three blood volume replacement products are Hextend,(R)
PentaLyte,(R) and HetaCool.(TM) Hextend and PentaLyte are our proprietary
hydroxyethyl starch-based synthetic blood plasma volume expanders designed to
treat loss of blood volume in surgery and trauma care patients. Hextend and
PentaLyte may be used in similar surgical and trauma care procedures, but
PentaLyte is designed especially for use when a faster elimination of the starch
component is desired and acceptable. HetaCool is a modified formulation of
Hextend and is specifically designed for use at low temperatures.
We have completed the submission of a new drug application to the United
States Food and Drug Administration, seeking approval to market Hextend in the
United States. The FDA has completed its review of our application, and during
November 1998 we received an action letter from them requesting several
clarifications. We have responded to the FDA's request and we are presently
awaiting their approval.
BioTime and Abbott Laboratories have entered into a License Agreement
under which we granted to Abbott an exclusive license to manufacture and sell
Hextend in the United States and Canada for all therapeutic uses other than
those involving hypothermic surgery, or the replacement of substantially all of
a patient's circulating blood volume. We still retain all rights to
manufacture, sell or license Hextend and other products in all other countries.
BioTime was incorporated under the laws of the State of California on
November 30, 1990. BioTime's principal office is located at 935 Pardee Street,
Berkeley, California 94710. Its telephone number is (510) 845-9535.
Hextend(R) and PentaLyte(R) are registered trademarks, and HetaCool(TM) is
a trademark, of BioTime, Inc.
3
Purpose of the Rights Offer
The Board of Directors of BioTime has determined that it is necessary for
BioTime to raise additional capital at this time to finance its operations,
including:
o Costs of conducting additional clinical trials of BioTime products;
o Costs of seeking foreign regulatory approval of Hextend;
o Continued research and product development; and
o General and administrative expenses.
We are issuing the Rights to raise additional capital without diluting the
ownership interests of existing shareholders who exercise their Rights (except
to the extent that BioTime issues additional common shares to fill
over-subscriptions), and without paying underwriting commissions and expenses.
Shareholders who exercise their Rights will be able to purchase shares at a
price below market, without incurring broker's commissions.
Generally, shareholders who exercise their Rights in full will be able to
maintain their prorata share of BioTime's outstanding common shares. However,
if the Rights offer is over-subscribed and BioTime issues additional common
shares to fill over-subscriptions, shareholders who do not purchase their
prorata portion of those additional shares by over-subscribing would experience
a reduction in their percentage interests in BioTime's outstanding shares. The
distribution of the Rights to shareholders will also afford those shareholders
who choose not to exercise their Rights the potential of receiving a cash
payment upon the sale of their Rights. Therefore, the receipt of Rights by
shareholders who choose not to exercise their Rights may be viewed as
compensation for the possible dilution.
Terms of The Rights Offer
Securities
Offered .........BioTime is issuing new securities called "Rights." Holders
of the Rights will be entitled to subscribe for and purchase
up to an aggregate of 501,654 BioTime common shares. You
will receive Rights from BioTime if you owned BioTime shares
as of the close of business on January 5, 1999, which has
been set as the record date. If your shares were held in the
name of Cede & Co. as nominee for The Depository Trust
Company, or in the name of any other depository or nominee,
on the record date, you will also receive Rights. You will
receive one Right for each common share that you owned on
the record date. The Rights will entitle you to subscribe
for and purchase one new common share for every 20 Rights
you hold. The Rights may be exercised at any time during the
subscription period, which commences on ______, 1999 and
ends at 5:00 p.m. New York time on ______, 1999.
Subscription
Price ...........The subscription price per common share is $______.
4
Over-Subscription
Privilege .......Shareholders who fully exercise the Rights initially issued
to them will be entitled to the additional privilege of
subscribing for and purchasing any common shares not
acquired by other holders of Rights. See "The Rights
Offer--Over-Subscription Privilege." If over-subscriptions
for common shares exceed the number of common shares
available for sale, BioTime may issue up to 250,000
additional common shares to fill all or a portion of the
over- subscriptions. BioTime will not be obligated to issue
any additional common shares to fill over-subscriptions, but
it may do so in its sole and absolute discretion.
How to Exercise
Rights ..........The Rights will be evidenced by subscription certificates,
which will be distributed to shareholders. You may exercise
your Rights by completing the subscription certificate and
delivering it, together with payment of the subscription
price, to the subscription agent, American Stock Transfer &
Trust Company, 40 Wall Street, New York, New York 10005.
Payment may be made either by check drawn on a United States
bank, or by notice of guaranteed delivery (as explained
under "The Rights Offer--Payment for Shares"). Rights must
be exercised no later than the expiration date. You may not
rescind a purchase after exercising your Rights.
Sale of Rights .....The Rights are transferable until the last business day
prior to the expiration date. A business day is a day on
which Nasdaq trades. The Rights are expected to be
authorized for trading on Nasdaq. Trading of the Rights will
be conducted on a regular-way basis from ______, 1999
through the last business day prior to the expiration date.
Any commissions in connection with the sale of Rights will
be paid by the selling Rights holder. BioTime and the
subscription agent cannot assure that a market for the
Rights will develop, or the prices at which Rights may be
sold if a market does develop.
Participation by
Officers,
Directors and
Certain
Financial
Consultants .....Officers, directors, and certain financial consultants of
BioTime who own, in the aggregate, 2,341,989 common shares,
have informed BioTime that they intend to purchase up to
117,099 common shares through the exercise of Rights
distributed to them, provided that suitable financial
arrangements can be made, but they are not legally bound to
do so.
5
Foreign
Restrictions ....Subscription certificates will not be mailed to shareholders
whose addresses of record are outside the United States. The
Rights will be held by the subscription agent for foreign
shareholders' accounts until instructions are received to
exercise, sell or transfer the Rights. If no instructions
are received by 12:00 noon, New York time on ______, 1999
(three business days prior to the expiration date), the
subscription agent will use its best efforts to sell the
Rights of foreign shareholders. The net proceeds, if any,
from such a sale will be paid to the foreign shareholders on
a prorata basis. See "The Rights Offer--Foreign
Shareholders."
Important Dates
to Remember .....Record Date: January 5, 1999
Expiration Date: ______, 1999
Last Date of Guaranteed Delivery: ______, 1999
Amendment,
Extension or
Termination of
the Rights
Offer ...........BioTime reserves the right, in its sole discretion, to: (a)
terminate the Rights offer prior to delivery of the common
shares for which Rights holders have subscribed; (b) extend
the expiration date to a later date; (c) change the record
date prior to the distribution of the Rights to
shareholders; or (d) amend or modify the terms of the Rights
offer.
6
RISK FACTORS
An investment in the Common Shares involves a high degree of risk. You
should purchase the common shares only if you can afford to lose your entire
investment. Before deciding to purchase any of the common shares offered by
this prospectus, you should consider the following factors which could
materially adversely affect the proposed operations and prospects of BioTime
and the value of an investment in BioTime. There may be other factors that are
not mentioned here or of which we are not presently aware that could also
affect BioTime's operations.
Our Products Are Not Yet on the Market
We cannot be sure when we will start receiving revenues from product sales
because:
o Our products are not yet on the market;
o Our products cannot be sold until the products are approved by the
FDA and foreign regulatory authorities;
o We have not yet received FDA approval to sell any of our products;
and
o It can take several months for a pharmaceutical company to introduce
a new product to the market.
We May Not Succeed In Marketing Our Products
Our ability to generate operating revenue depends upon our success in
developing and marketing our products. There can be no assurance that any of
our products will be successfully marketed or that we will receive sufficient
revenues from product sales to meet our operating expenses or to earn a profit.
o Physicians and hospitals may be reluctant to try a new product due to
the high degree of risk associated with the application of new
technologies and products in the field of human medicine.
o Our plasma expander products will compete with other products,
including albumin and other colloid solutions, and crystalloid
solutions. Some of these products, in particular crystalloid
solutions, are commonly used in surgery and trauma care and sell at
low prices.
o In order to compete with other products, particularly those that sell
at lower prices, BioTime products will have to be recognized as
providing medically significant advantages.
o Competing products are being manufactured and marketed by established
pharmaceutical companies with more resources than BioTime. For
example, DuPont Pharmaceuticals presently markets Hespan, an
artificial plasma volume expander, and Viaspan, a solution for use in
the preservation of kidneys, livers and pancreases for surgical
transplant. Abbott manufactures and sells a generic equivalent of
Hespan.
o There also is a risk that BioTime's competitors may succeed in
developing safer or more effective products that could render our
products and technologies obsolete or noncompetitive.
Many of Our Products and Technologies are Experimental
o We are attempting to develop new medical products and technologies.
o Many of BioTime's experimental products and technologies have not
been applied in human medicine and have only been used in laboratory
studies on animals, and there can be no assurance that those products
will prove to be safe and efficacious in the human medical
applications for which they were developed.
o The experimentation we are doing is costly, time consuming and
uncertain as to its results.
o If we are successful in developing a new technology or product,
refinement of the new technology or product and definition of the
practical applications and limitations of the technology or product
may take years and require the expenditure of large sums of money.
7
FDA and Other Regulatory Approvals Required
The products that we develop cannot be sold until the FDA and
corresponding foreign regulatory authorities approve the products for medical
use. This means that:
o We will have to conduct expensive and time consuming clinical trials
of new products;
o We will incur the expense and delay inherent in seeking FDA approval
of new products;
o A product that is approved may be subject to restrictions on use;
o The FDA can recall or withdraw approval of a product if problems
arise; and
o We will face similar regulatory issues in foreign countries.
We May Need Additional Financing
We believe that our cash on hand will be sufficient to permit BioTime to
continue in operation for at least 12 months. We expect to continue to incur
substantial research, product development, and regulatory expenses. We may need
to raise additional capital after the Rights offer to pay operating expenses
until we are able to generate sufficient revenues from product sales,
royalties, and license fees. There can be no assurance that we will be able to
raise additional funds on favorable terms or at all, or that any funds raised
will be sufficient to permit BioTime to develop and market its products. Unless
BioTime is able to generate sufficient revenue or raise additional funds when
needed, it is likely that it will be unable to continue its planned activities,
even if it is making progress with its research and development projects.
We Lack Manufacturing and Marketing Capabilities
BioTime presently does not have adequate facilities or resources to
manufacture its products or the hydroxyethyl starches used in its products. We
have granted Abbott an exclusive license to manufacture and market Hextend in
the United States and Canada, and we plan to enter into arrangements with
pharmaceutical companies for the production and marketing of BioTime products
in other countries. Although a number of other pharmaceutical companies have
expressed their interest in obtaining licenses to manufacture and market
BioTime products in other countries, there can be no assurance that we will be
successful making other licensing arrangements. If licensing or manufacturing
arrangements cannot be made on acceptable terms, we will have to construct or
acquire our own manufacturing facilities and to establish our own marketing
organization, which would entail significant expenditures of time and money.
Our Patents May Not Protect Our Products
BioTime has patents in the United States, Israel, and South Africa, and
has filed patent applications in other foreign countries, for certain products,
including Hextend, HetaCool, and PentaLyte. No assurance can be given that any
additional patents will be issued to us, or that, if issued, those patents will
provide BioTime with meaningful patent protection, or that others will not
successfully challenge the validity or enforceability of any patent issued to
BioTime. The costs required to uphold the validity and prevent infringement of
any patent issued to BioTime could be substantial, and we might not have the
resources available to defend our patent rights.
Uncertainty of Health Care Reimbursement and Reform
Success in selling BioTime's products may depend in part on the extent to
which health insurance companies, HMOs, and government health administration
authorities such as Medicare and Medicaid will pay for the cost of the products
and related treatment. There can be no assurance that adequate health
insurance, HMO, and government coverage will be available to permit our
products to be sold at prices high enough for us to generate a profit. In some
foreign countries, pricing or profitability of health care products is subject
to government control. In the United States, there have been a number of
federal and state proposals to implement similar government controls, and new
proposals are likely to be made in the future.
8
We Depend Upon Key Personnel
BioTime depends to a considerable degree on the continued services of its
executive officers. Although BioTime maintains key man life insurance in the
amount of $1,000,000 on the life of Dr. Paul Segall, the loss of the services
of any of the executive officers could have a material adverse effect on
BioTime. In addition, our success will depend, among other factors, upon
successful recruitment and retention of additional highly skilled and
experienced management and technical personnel.
Year 2000 Considerations
Because we do not have our own pharmaceutical production facilities, we
will rely upon Abbott and others to manufacture and distribute our products.
Our future sales could be adversely affected if year 2000 problems were to
impede the ability of those companies to manufacture and distribute our
products or to provide raw materials used in the manufacture of our products.
We do not have a contingency plan to address those problems if they were to
arise, and we may not be able to replace Abbott or any other company that may
obtain a license to manufacture and distribute our products. Abbott has
announced the implementation of a program to assess and remedy any year 2000
problems that may affect its operations, and has asked its key suppliers to
certify that their systems are year 2000 compliant. The results of the year
2000 compliance programs implemented by Abbott and its suppliers are not
presently known.
We Do Not Pay Dividends
BioTime does not pay cash dividends on its common shares. For the
foreseeable future we anticipate that any earnings generated in our business
will be used to finance the growth of BioTime and will not be paid out as
dividends to our shareholders. This means that our stock may not be a suitable
investment for anyone who needs to earn income from their investments.
The Market for Our Common Shares Has Been Volatile
The common shares are traded on Nasdaq. The market price of the common
shares, like that of the common stock of many biotechnology companies, has been
highly volatile. The price of BioTime shares may rise rapidly in response to
certain events, such as the commencement of clinical trials of an experimental
new drug, even though the outcome of those trials and the likelihood of
ultimate FDA approval remains uncertain. Similarly, prices of BioTime shares
may fall rapidly in response to certain events such as unfavorable results of
clinical trials or a delay or failure to obtain FDA approval. In the event that
BioTime achieves earnings from the sale of products, securities analysts may
begin predicting quarterly earnings. The failure of BioTime's earnings to meet
analysts' expectations could result in a significant rapid decline in the
market price of BioTime's common shares. In addition, the stock market has
experienced and continues to experience extreme price and volume fluctuations
which have affected the market price of the equity securities of many
biotechnology companies and which have often been unrelated to the operating
performance of these companies. Broad market fluctuations, as well as general
economic and political conditions, may adversely affect the market price of the
common shares.
We Might Not Meet the Requirements for Continued Listing on Nasdaq
BioTime's common shares are traded on the Nasdaq National Market, which
has adopted rules that establish criteria for initial and continued listing of
securities. Under the rules for continued listing on the Nasdaq National
Market, a company must maintain at least $4,000,000 of net tangible assets, or
at least $50,000,000 of total assets, or a market capitalization of at least
$50,000,000, or to have generated at least $50,000,000 of revenue. Although
BioTime had a market capitalization in excess of $50,000,000 on the date of
this prospectus, and will have net tangible assets in excess of $4,000,000 if a
sufficient number of common shares are sold in the Rights offer, future losses
from operations could cause BioTime's net tangible assets or market
capitalization to decline below the Nasdaq listing criteria in the future. If
the common shares are delisted from the Nasdaq National Market, trading in the
common shares could be conducted on the Nasdaq SmallCap Market or on an
electronic bulletin board established for securities that do not meet the
Nasdaq listing requirements. If the common shares were delisted from the Nasdaq
National Market and were not listed on the Nasdaq SmallCap Market, they would
be subject to the
9
so-called penny stock rules that impose restrictive sales practice requirements
on broker-dealers who sell those securities. Consequently, delisting, if it
occurred, could affect the ability of shareholders to sell their common shares
in the secondary market.
We Will Have Broad Discretion on the Use of Proceeds
Management of BioTime will have broad discretion in determining the use to
which the net proceeds of the Rights offer will be put. This means that
investors will not be able to evaluate our spending plans before they decide
whether to exercise or sell their Rights.
THE COMPANY
BioTime is developing aqueous based synthetic solutions that can be used
as blood plasma volume expanders, blood replacement solutions during
hypothermic (low temperature) surgery, and organ preservation solutions. Plasma
volume expanders are used to treat decreased blood volume resulting from blood
loss in surgical or trauma patients. We are developing products that may be
used in large volumes, even when blood loss becomes so severe that a
transfusion of packed red blood cells or other blood products is required. We
are also developing a specially formulated hypothermic blood replacement
solution that would be used for the replacement of a patient's circulating
blood volume during cardiac surgery, neurosurgery and other surgeries that
involve lowering the patient's body temperature.
Our first three blood volume replacement products are Hextend, PentaLyte,
and HetaCool. Hextend and PentaLyte are our proprietary hydroxyethyl
starch-based synthetic blood plasma volume expanders designed to treat loss of
blood volume in surgery and trauma care patients. Hextend and PentaLyte may be
used in similar surgical and trauma care procedures, but PentaLyte is designed
especially for use when a faster elimination of the starch component is desired
and acceptable. HetaCool is a modified formulation of Hextend and is
specifically designed for use at low temperatures.
Hextend, PentaLyte and HetaCool have been formulated to maintain the
patient's tissue and organ function by sustaining the patient's fluid volume
and physiological balance. Other products (known as colloid and crystalloid
solutions) are being marketed by other companies for use in maintaining patient
fluid volume in surgery and trauma care, but the use of those solutions can
contribute to patient morbidity, including conditions such as hypovolemia,
edema, impaired blood clotting, acidosis, and other biochemical imbalances.
Hextend, PentaLyte, and HetaCool contain ingredients that may prevent or reduce
the physiological imbalances that can cause those problems. Albumin produced
from human plasma is expensive and subject to supply shortages, and a recent
FDA warning has cautioned physicians about the risk of administering albumin to
seriously ill patients.
We have completed the submission of a new drug application to the FDA,
seeking approval to market Hextend in the United States. The FDA has completed
its review of our application, and during November 1998 we received an action
letter from them requesting several clarifications. We have responded to the
FDA's request and we are presently awaiting their approval.
The new drug application includes data from our Phase III clinical trials,
in which the primary endpoints were successfully met when Hextend was used as a
plasma volume expander in surgery. An important goal of the Hextend development
program was to produce a product that can be used in multi-liter volumes to
treat patients who have lost a large volume of blood. An average of 1.6 liters
of Hextend was used in the clinical trials, and volumes ranging from two to
five liters were used in some of the higher blood loss cases. The safety
related secondary endpoints targeted in the study included those involving
coagulation. We believe that the low incidence of adverse events related to
blood clotting in the Hextend patients demonstrates that Hextend may be safely
used in large amounts. However, the FDA will make its own evaluation of the
clinical trial data and there is no assurance that the FDA will approve
BioTime's new drug application.
On April 23, 1997, BioTime and Abbott Laboratories entered into a License
Agreement under which we granted to Abbott an exclusive license to manufacture
and sell Hextend in the United States and Canada for all therapeutic uses other
than those involving hypothermic surgery or the replacement of substantially
all of a patient's circulating blood volume. We still retain all rights to
manufacture, sell or license Hextend and other products in all other countries.
10
Under the License Agreement, Abbott agreed to pay BioTime up to $40,000,000
in license fees based upon product sales and the achievement of certain
milestones. So far, we have received $1,650,000 of license fee milestone
payments. In addition to the license fees, Abbott will pay us a royalty on
annual net sales of Hextend. The royalty rate will be 5% plus an additional .22%
for each $1,000,000 of total annual net sales, up to a maximum annual royalty
rate of 36%. The royalty rate for each year will be applied on a total net sales
basis so that once the highest royalty rate for a year is determined, that rate
will be paid with respect to all sales for that year. Abbott's obligation to pay
royalties on sales of Hextend will expire in the United States or Canada when
all patents protecting Hextend in the applicable country expire and any third
party obtains certain regulatory approvals to market a generic equivalent
product in that country. Abbott also agreed to manufacture Hextend for sale by
BioTime in the event that Abbott's exclusive license is terminated prior to
expiration.
In order to preserve its rights to obtain an exclusive license for
PentaLyte under the License Agreement, Abbott notified us that Abbott will
supply BioTime with batches of PentaLyte, characterization and stability
studies, and other regulatory support needed for BioTime to file an
investigational new drug application and to conduct clinical studies.
We plan to enter global markets through licensing agreements with
over-seas pharmaceutical companies. We are in various stages of negotiations to
license our products to pharmaceutical companies in countries outside the
United States and Canada. By licensing our products abroad, we will avoid the
capital costs and delays inherent in acquiring or establishing our own
pharmaceutical manufacturing facilities and establishing an international
marketing organization.
A number of pharmaceutical companies in Europe, Asia and other markets
around the world have expressed their interest in obtaining licenses to
manufacture and market BioTime products. We met with representatives of Nihon
Pharmaceutical Company, Ltd. in Japan to discuss the development of BioTime
products for the Japanese market, and the development of a clinical trial
program to obtain Japanese regulatory approval. Nihon previously signed a
letter of intent to negotiate a licensing agreement to manufacture and market
our products in Japan. Nihon is a subsidiary of Takeda Chemical Industries,
Japan's largest pharmaceutical manufacturer.
We are also pursuing a global clinical trial strategy, the goal of which
is to permit BioTime to obtain regulatory approval for its products as quickly
and economically as practicable. For example, the United States Phase III
clinical trials of Hextend involved 120 patients and were completed in less
than 12 months. Although regulatory requirements vary from country to country,
we may be able to file applications for foreign regulatory approval of our
products based upon the results of the United States clinical trials. Based
upon discussions with the Canadian Bureau of Pharmaceutical Assessment, we plan
to file for Canadian market approval based upon the results of our United
States clinical trials. Regulatory approvals for countries that are members of
the European Union may be obtained through a mutual recognition procedure. We
plan to determine whether one or more member nations will accept an application
based upon the United States clinical trials. If approvals based upon those
trials can be obtained in the requisite number of member nations, then we would
be permitted to market Hextend in all 16 member nations.
We are conducting a pilot study of the use of Hextend to treat hypovolemia
in geriatric patients undergoing high blood loss surgery. This new clinical
trial is a double blind study designed to compare Hextend with a hetastarch in
saline solution and is intended to confirm and expand upon the results of the
United States Phase III trials. This pilot study may be used to design larger
scale trials that may be needed to obtain regulatory approval in Western
Europe. Approximately 62 patients 65 years of age or older will be studied. The
geriatric population generally experiences a higher degree of inter-operative
and post-operative mortality and morbidity than younger patients undergoing
similar major surgery. We believe that in a study involving geriatric patients
the advantages of Hextend will most clearly and consistently be seen. The trial
is being conducted at the Middlesex and Royal Free Hospitals of the University
College London Hospitals in London, England.
11
THE RIGHTS OFFER
Issuance of Rights
BioTime is issuing Rights to subscribe for common shares. The Rights will
be issued to shareholders who owned BioTime shares as of the close of business
on January 5, 1999, which has been set as the record date. Beneficial owners of
shares held in the name of Cede & Co. as nominee for The Depository Trust
Company, or in the name of any other depository or nominee, on the record date
will also receive Rights. Each shareholder will be issued one Right for each
common share owned on the record date. No fractional Rights will be issued. The
Rights entitle the holders to acquire one common share for each 20 Rights held
by paying the subscription price. Any shareholder who is issued fewer than 20
Rights may subscribe for one full common share at the subscription price. The
Rights will be evidenced by subscription certificates (see Appendix A) which
will be mailed to shareholders other than foreign shareholders whose record
addresses are outside the United States (the United States also includes the
District of Columbia, U.S. territories and possessions).
The Rights issued to foreign shareholders will be held by the subscription
agent for their accounts until instructions are received to exercise (if
permissible under applicable foreign securities laws), sell, or transfer those
Rights. If no instructions have been received by 12:00 noon, New York City
time, three business days prior to the expiration date, the subscription agent
will use its best efforts to sell the Rights of those foreign shareholders on
Nasdaq. The net proceeds from the sale of those Rights will be paid to the
foreign shareholders. See "Sale of Rights".
Officers, directors, and certain financial consultants of BioTime who own,
in the aggregate, 2,341,989 common shares, have informed BioTime that they
intend to purchase up to 117,099 common shares through the exercise of the
Rights distributed to them, provided that suitable financial arrangements can
be made, but they are not legally bound to do so. Any common shares acquired by
officers, directors and other persons who are "affiliates" of BioTime, as that
term is defined under the Securities Act of 1933, may only be sold in
accordance with Rule 144 under the Securities Act or pursuant to an effective
registration statement under the Securities Act. In general, under Rule 144, as
currently in effect, an "affiliate" of BioTime is entitled to sell, within any
three-month period, a number of shares that does not exceed the greater of 1%
of the then-outstanding common shares or the average weekly reported trading
volume of the common shares during the four calendar weeks preceding the sale.
Sales under Rule 144 are also subject to certain restrictions on the manner of
sale, to notice requirements and to the availability of current public
information about BioTime.
Purpose of the Rights Offer
The Board of Directors of BioTime has determined that it is necessary for
BioTime to raise additional capital at this time to finance its operations,
including:
o Costs of conducting additional clinical trials of BioTime products;
o Costs of seeking foreign regulatory approval of Hextend;
o Continued research and product development; and
o General and administrative expenses.
BioTime is waiting for FDA approval to market Hextend in the United
States. Abbott Laboratories has the exclusive right to market Hextend in the
United States following FDA approval, but several months will elapse between
the commencement of marketing and the payment of royalties and licensing fees
on the sale of Hextend. Until BioTime begins to receive sufficient revenues
from product sales and licensing fees from Abbott or other companies that may
obtain a license to sell BioTime products, it will have to finance its
operations with its cash on hand, the funds received from shareholders who
exercise their Rights, and any additional capital raised through other sales of
equity securities.
The Rights offer provides an opportunity for BioTime to raise additional
capital without diluting the ownership interests of existing shareholders who
exercise their Rights (except to the extent that BioTime issues additional
common shares to fill over-subscriptions), and without paying underwriting
commissions
12
and expenses. Shareholders who exercise their Rights will be able to purchase
BioTime shares at a price below market, without incurring broker's commissions.
Generally, shareholders who exercise their Rights in full will be able to
maintain their prorata share of BioTime's outstanding common shares. However,
if the Rights offer is over-subscribed and BioTime issues additional common
shares to fill over-subscriptions, shareholders who do not purchase their
prorata portion of those additional shares through the over-subscription
privilege would experience a reduction in their percentage interests in
BioTime's outstanding shares. The distribution of the Rights to shareholders
will also afford those shareholders who choose not to exercise their Rights the
potential of receiving a cash payment upon the sale of their Rights. Therefore,
the receipt of Rights by shareholders who choose not to exercise their Rights
may be viewed as compensation for the possible dilution of their interest in
BioTime.
We considered other financing alternatives, including a private placement
or underwritten public offering of newly issued shares. Those alternatives
would have entailed the payment of commissions and fees to broker-dealers, and
would also have been dilutive to BioTime shareholders because the shares would
have been sold to new investors. In the case of a private placement, the sale
would probably have been made at a discount to market. In contrast, the sale of
shares through the Rights offer will permit BioTime to incur lower transaction
fees in raising capital and will permit the shareholders who exercise their
Rights to enjoy the price discount that might otherwise have been realized by
new investors. During January and February 1997, BioTime conducted a similar
subscription rights offer that was over-subscribed, leading BioTime to conclude
that the Rights offer might be a better alternative to the other sources of
financing.
The Subscription Price
The subscription price for the common shares to be issued pursuant to the
Rights offer is $______. We announced the Rights offer on December 18, 1998. The
last reported sale price of the common shares on Nasdaq on December 18, 1998 and
January ______, 1999, was $______ and $______, respectively.
Expiration of the Rights Offer
The Rights offer will expire at 5:00 p.m., New York City time, on ,
1999, the expiration date. Rights will expire on the expiration date and may
not be exercised after that date.
Exercise of Rights
In order to exercise your Rights you must do all of the following:
o Fill in and sign the reverse side of the subscription certificate
which accompanies this prospectus;
o Deliver the completed and signed subscription certificate to the
subscription agent with your payment in full for the common shares
you wish to purchase. You may use the enclosed envelope to mail the
subscription certificate and payment to the subscription agent or you
may arrange for one of the alternative methods of delivery described
below.
o The method of making payment for your shares is described below under
"Payment for Shares."
o Properly completed and executed subscription certificates must be
received by the subscription agent at the offices of the subscription
agent at the address set forth below prior to 5:00 p.m., New York
City time, on the expiration date, unless payment is effected by
means of a notice of guaranteed delivery as described below under
"Payment for Shares."
o Rights may also be exercised through a broker, who may charge you a
servicing fee.
You should send your signed subscription certificates, accompanied by
payment of the subscription price, to American Stock Transfer & Trust Company
(the subscription agent), by one of the methods described below:
13
(1) BY MAIL OR BY HAND:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
(2) BY EXPRESS MAIL OR OVERNIGHT COURIER:
American Stock Transfer & Trust Company
Corporate Stock Transfer Department
40 Wall Street
New York, New York 10005
(3) BY FACSIMILE (TELECOPIER):
(718) 236-4588 or (718) 234-5001
You should confirm that your facsimile has been received by contacting the
subscription agent by telephone at (718) 921-8200. If you deliver your
subscription certificate by telecopier, you must send the original subscription
certificate to the subscription agent by mail or hand delivery.
DO NOT SEND SUBSCRIPTION CERTIFICATES TO BIOTIME.
A subscription will be deemed accepted by the subscription agent when
payment, together with a properly completed and executed subscription
certificate, is received by the subscription agent at its Corporate Stock
Transfer Department.
If you are issued fewer than 20 Rights, you may subscribe for one full
common share. Fractional shares will not be issued, and if after exercising
your Rights you are left with fewer than 20 Rights, you will not be able to
exercise your remaining Rights.
If you do not indicate the number of Rights you are exercising, or if you
do not deliver full payment of the subscription price for the number of shares
that you indicate you are subscribing for, then you will be deemed to have
exercised Rights to purchase the maximum number of common shares determined by
dividing the total subscription price you paid by the subscription price per
share.
If you submit payment for more shares than may be purchased through the
regular exercise of your Rights, your excess payment will be deemed to be a
subscription payment for additional shares through the over-subscription
privilege. The number of additional shares that you will be deemed to have
subscribed for in the over-subscription privilege will be determined by
dividing the amount of the excess payment by the subscription price per share.
All questions concerning the timeliness, validity, form and eligibility of
any exercise of Rights or subscriptions pursuant to the over-subscription
privilege will be determined by BioTime. BioTime's determination will be final
and binding. BioTime in its sole discretion may waive any defect or
irregularity, or may permit any defect or irregularity to be corrected, within
such time as BioTime may determine. BioTime may reject, in whole or in part,
the purported exercise of any Right or any subscription pursuant to the
over-subscription privilege. Neither BioTime nor the subscription agent will be
under any duty or obligation to give any notification or to permit the cure of
any defect or irregularity in connection with the submission of any
subscription certificate, the exercise or attempt to exercise any Right or the
over-subscription privilege, or the payment of the subscription price.
Subscriptions through the exercise of Rights or the over-subscription privilege
will not be deemed to have been received or accepted by BioTime until all
irregularities or defects have been waived by BioTime or cured to the
satisfaction of, and within the time allotted by, BioTime in its sole
discretion.
Over-Subscription Privilege
The over-subscription privilege may allow you to acquire more common
shares than the number issuable upon the exercise of the Rights initially
issued to you. By exercising the over-subscription privilege, you may purchase
any shares that are left over by shareholders who fail to exercise their
Rights.
14
The over-subscription privilege may only be exercised by Rights holders
who were shareholders on the record date and who exercise all of the Rights
they received from BioTime. Any person who purchases Rights and who was not a
shareholder on the record date may not exercise the over-subscription
privilege. Shareholders such as broker-dealers, banks, and other professional
intermediaries who hold shares on behalf of clients, may participate in the
over-subscription privilege for the client if the client fully exercises all
Rights attributable to him.
If you are eligible to exercise the over-subscription privilege and you
wish to do so, you should indicate on your subscription certificate how many
common shares you are willing to acquire through the over-subscription
privilege. If sufficient common shares remain unsold, all over-subscriptions
will be honored in full.
If you were a shareholder on the record date and you wish to exercise the
over-subscription privilege through The Depository Trust Corporation, you must
properly execute and deliver to the subscription agent a DTC Participant
Over-Subscription Form, together with payment of the subscription price for the
number of common shares that you wish to purchase through the over-subscription
privilege. Copies of the DTC Participant Over-Subscription Form may be obtained
from the subscription agent. Your properly executed DTC Participant
Over-Subscription Form and payment must be received by the subscription agent
at or prior to 5:00 p.m., New York City time on the expiration date.
If you are eligible to exercise the over-subscription privilege but you do
not deliver full payment of the subscription price for the number of shares
that you indicate you are subscribing for through the over-subscription
privilege, then you will be deemed to have exercised the over-subscription
privilege to purchase the maximum number of common shares determined by
dividing the total subscription price paid (in excess of the subscription price
for the number of common shares you purchased through the full exercise of your
Rights) by the subscription price per share.
If subscriptions for common shares through the over-subscription privilege
exceed the initial 501,654 common shares being offered by BioTime through the
exercise of the Rights, BioTime may issue up to 250,000 additional common
shares to fill all or a portion of the over-subscriptions. The issuance of
additional common shares to fill over-subscriptions may dilute the percentage
ownership interests of other shareholders.
BioTime will not be obligated to issue any common shares to fill
over-subscriptions, but it may do so in its sole and absolute discretion.
BioTime reserves the right to limit the number of common shares issued to fill
an over-subscription from any single shareholder or from shareholders that are
known or believed by BioTime to be under common control or acting as a group
for the purpose of acquiring common shares.
Subject to the right of BioTime to limit the number of common shares
issuable to any shareholder, if the Rights offer is over-subscribed so that
over-subscriptions cannot be filled in full, the available common shares will
be allocated among those who over-subscribe based on the number of Rights
originally issued to them, so that the number of common shares issued to
shareholders who subscribe pursuant to the over-subscription privilege will
generally be in proportion to the number of common shares owned by them on the
record date. The percentage of available common shares each over-subscribing
shareholder may acquire may be rounded up or down to result in delivery of
whole shares. The allocation process may involve a series of allocations in
order to assure that the total number of shares available for
over-subscriptions is distributed on a prorata basis. If you are not allocated
the full amount of shares that you subscribe for pursuant to the
over-subscription privilege, you will receive a refund of the subscription
price you paid for shares that are not allocated to and purchased by you. The
refund will be made by a check mailed by the subscription agent.
Payment for Shares
If you wish to exercise your Rights or to acquire common shares pursuant
to the over-subscription privilege, you may choose between the following
methods of payment:
15
1. You may send to the subscription agent full payment for all of the
common shares you wish to acquire, including any additional common shares
that you desire to acquire through the over-subscription privilege (if you
are entitled to exercise the over-subscription privilege). Make sure that
your payment is accompanied by your completed and signed subscription
certificate. The payment and properly completed and executed subscription
certificate must be received by the subscription agent no later than 5:00
p.m., New York City time, on the expiration date. The subscription agent
will deposit all checks received by it for the purchase of common shares
into a segregated interest-bearing account of BioTime pending proration and
distribution of common shares. The interest earned on the account will
belong to BioTime.
TO BE ACCEPTED, A PAYMENT PURSUANT TO THIS METHOD MUST BE MADE IN THE
FOLLOWING MANNER:
o The payment must be in U.S. dollars;
o The payment must be by money order or check drawn on a bank located
in the United States;
o The payment must be payable to BioTime, Inc.; and
o The payment must accompany a properly completed and executed
subscription certificate.
2. Alternatively, a subscription will be accepted by the subscription
agent if the subscription agent has received a notice of guaranteed
delivery by facsimile (telecopy) or otherwise from a bank, a trust company,
or a New York Stock Exchange member guaranteeing delivery of (i) payment of
the full subscription price for the common shares subscribed for, including
any additional common shares subscribed for pursuant to the
over-subscription privilege, and (ii) a properly completed and executed
subscription certificate. The notice of guaranteed delivery must be
received by the subscription agent before 5:00 p.m., New York City time, on
the expiration date. The subscription agent will not honor a notice of
guaranteed delivery unless a properly completed and executed subscription
certificate and full payment for the common shares is received by the
subscription agent by the close of business on the third business day after
the expiration date.
You will not be allowed to rescind your purchase after the subscription
agent has received payment either by means of a notice of guaranteed delivery
or a check or money order.
Nominees who hold common shares for the account of others, such as
brokers, trustees or depositories for securities, should notify the respective
beneficial owners of the common shares as soon as possible to ascertain the
beneficial owners' intentions and to obtain instructions with respect to the
Rights. If the beneficial owner so instructs, the nominee should complete the
subscription certificate and submit it to the subscription agent with the
proper payment. In addition, beneficial owners of common shares or Rights held
through a nominee should contact the nominee and request the nominee to effect
transactions in accordance with the beneficial owner's instructions.
Sale of Rights
The Rights are transferable until the expiration date and are expected to
be listed for trading on the Nasdaq SmallCap Market. Assuming a market for the
Rights develops, the Rights may be purchased and sold through usual brokerage
channels. Although no assurance can be given that a market for the Rights will
develop, trading in the Rights may be conducted until and including the close
of trading on the last business day prior to the expiration date.
You may transfer some or all the Rights evidenced by your subscription
certificate by following these instructions and the instructions on the back of
your subscription certificate. If you wish to transfer all of your Rights, you
need only sign your subscription certificate and deliver it to the subscription
agent. If you wish to transfer some but not all of your Rights, you must also
deliver to the subscription agent a subscription certificate properly endorsed
for transfer with instructions to register the portion of the Rights evidenced
by the subscription certificate in the name of the transferee and to issue a
new subscription certificate to the transferee evidencing the number of Rights
transferred. In that event, a new subscription certificate evidencing the
balance of the Rights will be issued to you or, if you so instruct, to an
additional transferee.
16
If you wish to transfer all or a portion of your Rights, you should allow
sufficient time prior to the expiration date for (i) the transfer instructions
to be received and processed by the subscription agent; (ii) a new subscription
certificate to be issued and transmitted to the transferee or transferees with
respect to transferred Rights, and to you with respect to retained Rights, if
any; and (iii) the Rights evidenced by the new subscription certificate to be
exercised or sold by the recipients. BioTime and the subscription agent shall
have no liability to a transferee or transferor of Rights if subscription
certificates are not received in time for exercise or sale prior to the
expiration date.
BioTime anticipates that the Rights will be eligible for transfer through
the facilities of The Depository Trust Company.
Except for the fees charged by the subscription agent (which will be paid
by BioTime), all commissions, fees and other expenses, including brokerage
commissions and transfer taxes, incurred in connection with the purchase, sale
or exercise of Rights will be for the account of the transferor of the Rights,
and none of those commissions, fees or expenses will be paid by BioTime or the
subscription agent.
Amendment, Extension or Termination of the Rights Offer
BioTime reserves the right, in its sole discretion, to: (a) terminate the
Rights offer prior to delivery of the common shares for which Rights holders
have subscribed; (b) extend the expiration date to a later date; (c) change the
record date prior to distribution of the Rights to shareholders; or (d) amend
or modify the terms of the Rights offer. If BioTime amends the terms of the
Rights offer, an amended prospectus will be distributed to you if you are a
holder of record of Rights or if you previously exercised any of your Rights.
If you exercised your Rights prior to the amendment or within four business
days after the mailing of the amended prospectus, you will be given the
opportunity to confirm the exercise of your Rights by executing and delivering
a consent form.
If you exercise Rights before or within four days after mailing of an
amended prospectus relating to an amendment of the Rights offer and you fail to
deliver, in a proper and timely manner, a properly executed consent form, you
will be deemed to have rejected the amended terms of the Rights offer and you
will be deemed to have elected to revoke in full the exercise of your Rights
and the over-subscription privilege. If your exercise of Rights is so revoked,
the full amount of the subscription price you paid will be returned to you.
If your executed subscription certificate is received by the subscription
agent more than four days after the mailing of an amended prospectus, you will
be deemed to have accepted the amended terms of the Rights offer in connection
with the exercise of your Rights and the over-subscription privilege.
If BioTime elects to terminate the Rights offer before delivering the
common shares for which you subscribed, the subscription price you paid will be
returned to you by mail. Except for the obligation to return the subscription
price you paid when you attempted to exercise your Rights, neither BioTime nor
the subscription agent will have any obligation or liability to you in the
event of an amendment or termination of the Rights offer.
Delivery of Share Certificates
Certificates representing the common shares you purchased by exercising
your Rights will be delivered to you as soon as practicable after your Rights
have been validly exercised and full payment for the common shares has been
received and cleared. Certificates representing common shares you purchase
pursuant to the over-subscription privilege will be delivered to you as soon as
practicable after the expiration date and after all allocations have been
effected. It is expected that the certificates will be available for delivery
three business days following the expiration date.
Subscription Agent
The subscription agent is American Stock Transfer & Trust Company, which
will receive for its administrative, processing, invoicing and other services
as subscription agent, a fee estimated to be $25,000, and reimbursement for all
out-of-pocket expenses related to the Rights offer. The subscription agent is
also BioTime's transfer agent and registrar. Questions regarding the
subscription certificates
17
should be directed to American Stock Transfer & Trust Company, 40 Wall Street,
New York, New York, 10005 (telephone (718) 921-8200). Shareholders may also
consult their brokers or nominees.
Federal Income Tax Consequences
The U.S. Federal income tax consequences to holders of common shares with
respect to the Rights offer will be as follows:
1. The distribution of Rights will not result in taxable income nor
will the holder realize taxable income as a result of the exercise of
Rights.
2. The basis of a Right will be (a) to a holder of common shares to
whom it is issued, and who exercises or sells the Right (i) zero, if the
market value of the Right immediately after issuance is less than 15% of
the market value of the common share with regard to which it is issued,
unless the holder elects, by filing a statement with his timely filed
federal income tax return for the year in which the Rights are received, to
allocate the basis of the common share between the Right and the common
share based on their respective market values immediately after the Right
is issued, and (ii) a portion of the basis in the common share based upon
the respective values of the common share and the Right immediately after
the Right is issued, if the market value of the Right immediately after
issuance is 15% or more of the market value of the common share with
respect to which it is issued; (b) zero, to a holder of common shares to
whom it is issued and who allows the Right to expire; and (c) the cost to
acquire the Right, to anyone who purchases a Right in the market.
3. The holding period of a Right received by a holder of a common share
includes the holding period of the common share.
4. Any gain or loss on the sale of a Right will be treated as a capital
gain or loss if the Right is a capital asset in the hands of the seller. A
capital gain or loss will be long-term or short-term, depending on how long
the Right has been held, in accordance with paragraph 3 above. A Right
issued with regard to a common share will be a capital asset in the hands
of the person to whom it is issued if the common share was a capital asset
in the hands of that person. If a Right is allowed to expire, there will be
no loss realized unless the Right had been acquired by purchase, in which
case there will be a loss equal to the basis of the Right.
5. If a Right is exercised by the holder of common shares, the basis of
the common share received will include the basis allocated to the Right and
the amount paid upon exercise of the Right.
6. If a Right is exercised, the holding period of the common share
acquired begins on the date the Right is exercised.
7. Gain recognized by a non-U.S. shareholder on the sale of a Right
will be taxed in the same manner as gain recognized on the sale of common
shares.
Proceeds from the sale of a Right may be subject to withholding of U.S.
taxes at the rate of 31% unless the seller's certified U.S. taxpayer
identification number (or certificate regarding foreign status) is on file with
the subscription agent and the seller is not otherwise subject to U.S. backup
withholding. The 31% withholding tax is not an additional tax. Any amount
withheld may be credited against the seller's U.S. federal income tax
liability.
The foregoing is only a summary of the applicable federal income tax law
and does not include any state or local tax consequences of this transaction.
Shareholders and other Rights holders should consult their tax advisers
concerning the tax consequences of the Rights offer.
Special Considerations
As a result of the terms of the Rights offer, shareholders who do not
fully exercise their Rights should expect that they will, at the completion of
the Rights offer, own a smaller proportional interest in BioTime than would
otherwise be the case.
18
USE OF PROCEEDS
The net proceeds received by BioTime from the sale of the 501,654 common
shares in the Rights offer are estimated to be $ , after deducting the
expenses of the Rights offer of approximately $115,000, but without taking into
account any common shares that may be sold to fill excess over-subscriptions.
BioTime intends to use the net proceeds of the Rights offer as follows:
Application Estimated Amount Percent of Total
----------- ---------------- ----------------
Research and Development $ 50%
Working Capital 50
---------------- ---
Total $ 100%
================ ===
Research and Development. Proceeds allocated to research and development
will be used to finance clinical testing of Hextend, HetaCool, and PentaLyte,
and laboratory testing of other products being developed by BioTime. When
laboratory testing of a product has been completed, a portion of the proceeds
allocated to research and development may also be used to commence clinical
trials of that product.
Working Capital. BioTime intends to apply the balance of the proceeds of
the Rights offer to working capital and general corporate purposes. BioTime's
management will have broad discretion with respect to the use of proceeds
retained as working capital. The proceeds may be used to defray overhead
expenses and for future opportunities and contingencies that may arise. BioTime
expects that its general and administrative expenses will increase as it
achieves progress in developing products and bringing them to market. For
example, a portion of the proceeds allocated to working capital may be used to
pay the salaries, benefits and fees to employees and consultants who assist in
the preparation of applications to the FDA and foreign regulatory agencies and
patent applications, and to expand BioTime's research facilities. Proceeds
allocated to working capital also may be reallocated to research and
development and may be used to pay the costs of clinical trials of Hextend and
other products.
The lease of BioTime's present office and research facility will expire on
June 30, 1999 and we need additional space to expand our research facility. We
expect to enter into an extension of the lease of our present facility that
would include some additional space for expansion. However, we are considering
a number of alternative opportunities to acquire additional research space. We
might lease or purchase a larger building that would provide more expansion
space, if we can do so on terms that we deem beneficial to BioTime. The cost of
expanding our present facilities or acquiring a new facility will vary,
depending upon the amount of space we obtain, the extent to which improvements
must be built, and the terms on which we may lease or purchase the space.
The foregoing table represents only an estimate of the allocation of the
net proceeds of the Rights offer based upon the current state of BioTime's
product development program. The development of new medical products and
technologies often involves complications, delays and costs that cannot be
predicted, and may cause BioTime to make a reallocation of proceeds among the
categories shown above or to other uses. BioTime may need to raise additional
capital after the Rights offer to pay operating expenses until such time as it
is able to generate sufficient revenues from product sales, royalties, and
license fees.
Although BioTime is not presently a party to any agreement, arrangement or
plan to acquire any assets or technology from a third party, BioTime might
determine that it is necessary or advantageous to make such an acquisition, or
BioTime might determine to concentrate its efforts and resources on the
development and marketing of one or more specific products.
Until used, the net proceeds of the Rights offer will be invested in
certificates of deposit, United States government securities or other high
quality, short-term interest-bearing investments.
19
DESCRIPTION OF SECURITIES
Common Shares
BioTime's Articles of Incorporation currently authorize the issuance of up
to 40,000,000 common shares, no par value, of which 10,033,079 shares were
outstanding at January 5, 1999 and held by 6,918 persons based upon the share
position listings for the common shares. Each holder of record is entitled to
one vote for each outstanding common share owned by him on every matter
properly submitted to the shareholders for their vote.
Subject to the dividend rights of holders of any of the preferred shares
that may be issued from time to time, holders of common shares are entitled to
any dividend declared by the Board of Directors out of funds legally available
for that purpose. BioTime has not paid any cash dividends on its common shares,
and it is unlikely that any cash dividends will be declared or paid on any
common shares in the foreseeable future. Instead, BioTime plans to retain its
cash for use in financing its future operations and growth.
Subject to the prior payment of the liquidation preference to holders of
any preferred shares that may be issued, holders of common shares are entitled
to receive on a prorata basis all remaining assets of BioTime available for
distribution to the holders of common shares in the event of the liquidation,
dissolution, or winding up of BioTime. Holders of common shares do not have any
preemptive rights to become subscribers or purchasers of additional shares of
any class of BioTime's capital stock.
Preferred Shares
BioTime's Articles of Incorporation currently authorize the issuance of up
to 1,000,000 preferred shares, no par value. Preferred shares may be issued by
BioTime in one or more series, at any time, with such rights, preferences,
privileges and restrictions as the Board of Directors may determine, all
without further action of the shareholders of BioTime. Any series of preferred
shares which may be authorized by the Board of Directors in the future may be
senior to and have greater rights and preferences than the common shares. There
are no preferred shares presently outstanding and BioTime has no present plan,
arrangement or commitment to issue any preferred shares.
Transfer Agent and Registrar
The transfer agent and registrar for the common shares is American Stock
Transfer and Trust Company, 40 Wall Street, New York, New York 10005.
LEGAL MATTERS
The validity of the Rights and common shares will be passed upon for
BioTime by Lippenberger, Thompson, Welch, Soroko & Gilbert LLP, San Francisco,
California. A member of Lippenberger, Thompson, Welch, Soroko & Gilbert LLP
owns options to purchase 30,000 common shares.
EXPERTS
The financial statements of BioTime, Inc. as of June 30, 1997 and 1998 and
for each of the three fiscal years in the period ended June 30, 1998
incorporated by reference in this prospectus from BioTime's Annual Report on
Form 10-K for the year ended June 30, 1998 have been audited by Deloitte &
Touche LLP, independent auditors, as stated in their report (which expresses an
unqualified opinion and includes an explanatory paragraph related to the
development stage of BioTime's operations) incorporated herein by reference,
and have been so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
20
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
BioTime's Form 10-K for the fiscal year ended June 30, 1998, Form 10-Q for
the three months ended September 30, 1998, and all other reports filed by
BioTime pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of
1934, as amended, since the end of the fiscal year covered by such Form 10-K
are incorporated into this prospectus by reference. BioTime has announced a
change of its fiscal year end from June 30 to December 31. The change took
effect on December 31, 1998. BioTime will provide without charge to each
person, including any beneficial owner, to whom a prospectus is delivered, upon
written or oral request, a copy of any and all of the information that has been
incorporated by reference but not delivered with this prospectus. Such requests
may be addressed to the Secretary of BioTime at 935 Pardee Street, Berkeley,
California 94710; Telephone: (510) 845-9535.
BioTime is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith files quarterly,
annual, and current reports and proxy statements and other information with the
Securities and Exchange Commission. The public may read and copy any materials
BioTime files with Securities and Exchange Commission at the Commission's
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The
public may obtain information on the operation of the Public Reference Room by
calling the Commission at 1-800-SEC-0330.
The Commission maintains an Internet site that contains reports, proxy and
information statements, and other information regarding issuers that file
electronically with the Commission. The address of such site is
http://www.sec.gov.
ADDITIONAL INFORMATION
BioTime has filed with the Securities and Exchange Commission, 450 Fifth
Street, N.W., Washington, D.C. a registration statement on Form S-3 under the
Securities Act of 1933, as amended, for the registration of the securities
offered by this prospectus. This prospectus, which is part of the registration
statement, does not contain all of the information contained in the
registration statement. For further information with respect to BioTime and the
securities offered by this prospectus, reference is made to the registration
statement, including the exhibits, which may be inspected, without charge, at
the Office of the Securities and Exchange Commission, or copies of which may be
obtained from the Commission in Washington, D.C. upon payment of the requisite
fees. Statements contained in this prospectus as to the content of any contract
or other document referred to are not necessarily complete. In each instance
reference is made to the copy of the contract or other document filed as an
exhibit to the registration statement, and each such statement is qualified in
all respects by reference to the exhibit.
21
CONTROL NUMBER BIOTIME, INC. SUBSCRIPTION CERTIFICATE FOR
SUBSCRIPTION CERTIFICATE FOR COMMON SHARES
VOID IF NOT EXERCISED AT OR BEFORE 5:00 P.M.
(NEW YORK TIME) ON ______, 1999, THE EXPIRATION DATE. RIGHTS
THIS SUBSCRIPTION CERTIFICATE IS TRANSFERRABLE
AND MAY BE COMBINED OR DIVIDED
Expiration Date ______, 1999 (BUT ONLY INTO SUBSCRIPTION SUBSCRIPTION PRICE
CERTIFICATES EVIDENCING A WHOLE NUMBER OF RIGHTS) U.S. $______
AT THE OFFICE OF THE SUBSCRIPTION AGENT PER SHARE
CUSIP 09066L 12 1
THIS SUBSCRIPTION CERTIFICATE MAY BE USED TO SUBSCRIBE FOR
COMMON SHARES OR MAY BE ASSIGNED OR SOLD. FULL INSTRUCTIONS
APPEAR ON THE BACK OF THIS SUBSCRIPTION CERTIFICATE.
REGISTERED OWNER:
The registered owner of this Subscription Certificate, named above, or assignee,
is entitled to the number of Rights to subscribe for Common Shares, no par
value, of BioTime, Inc. shown above, in the ratio of one Common Share for each
20 Rights held, and upon the terms and conditions and at the price for each
Common Share specified in the Prospectus dated ______, 1999.
If you exercise fewer than all the Rights represented by this Subscription
Certificate, the subscription agent will issue a new Subscription Certificate
representing the balance of the unexercised Rights, provided that the
subscription agent has received your properly completed and executed
Subscription Certificate and payment prior to 5:00 p.m., New York time, on
______, 1999. No new Subscription Certificate will be issued after that date.
IMPORTANT: Complete appropriate form on reverse
DATE: , 1999
BIOTIME, INC.
- --------------------------------------------------------------------------------
SECRETARY
- --------------------------------------------------------------------------------
CHIEF EXECUTIVE OFFICER
Countersigned: American Stock Transfer & Trust Company
(New York, N.Y.) Subscription Agent
By: ___________________________________________
Authorized Signature
APPENDIX A
A-1
Expiration Date: ______, 1999
PLEASE COMPLETE ALL APPLICABLE INFORMATION
By Mail: By Hand: By Overnight Courier:
To: America Stock To: America Stock To: American Stock
Transfer & Trust Company Transfer & Trust Company Transfer & Trust Company
40 Wall Street 40 Wall Street, 46th Floor 40 Wall Street, 46th Floor
New York, New York 10005 New York, New York 10005 New York, New York 10005
SECTION 1: TO SUBSCRIBE: I hereby irrevocably subscribe for the dollar amount
of Common Shares indicated as the total of A and B below upon the terms
and conditions specified in the Prospectus related hereto, receipt of
which is acknowledged.
TO SELL: If I have checked either the box on line C or the box on line
D, I authorize the sale of Rights by the subscription agent according
to the procedures described in the Prospectus. The check for the
proceeds of sale will be mailed to the address of record.
Please check [X] below:
[ ] A. Subscription divided by 20 = .000 x $ = $
------------------ ------------------ -------------------- ----------------
(Rights Exercised) (Shares Requested) (Subscription Price) (Amount Required)
[ ] B. Over-Subscription Privilege .000 x $ = $ (*)
------------------ -------------------- -------------------
(Shares Requested) (Subscription Price) (Amount Required)
Amount of Check Enclosed or Amount in Notice of Guaranteed Delivery (total of A + B) = $
--------------------
Make check payable to the order of "BioTime, Inc."
(*) The Over-Subscription Privilege can be exercised by certain shareholders only, as described in the
Prospectus.
[ ] C. Sell any remaining unexercised Rights
[ ] D. Sell all of my Rights.
_______________________________________ Please provide your telephone number Day (___)___________________________
Signature of Subscriber(s)/Seller(s) Evening (___)___________________________
Social Security Number or Tax ID Number: _______________________________________________
SECTION II: TO TRANSFER RIGHTS: (except pursuant to C and D above)
For value received, __________________________ of the Rights represented by this Subscription Certificate are assigned to
- ---------------------------------------------------------- ----------------------------------------------------------
Social Security Number or Tax ID Number of Assignee (Print Full Name of Assignee
- ---------------------------------------------------------- ----------------------------------------------------------
Signature(s) of Assignor(s) (Print Full Address including postal Zip Code)
The signature(s) must correspond with the name(s) as written upon the face of this Subscription Certificate, in every
particular, without alteration.
IMPORTANT: For transfer, a signature guarantee must be provided by an eligible financial institution which is a participant
in a recognized signature guarantee program.
SIGNATURE GUARANTEED BY:
- ------------------------------------
PROCEEDS FROM THE SALE OF RIGHTS MAY BE SUBJECT TO WITHHOLDING OF U.S. TAXES UNLESS THE SELLER'S CERTIFIED U.S. TAXPAYER
IDENTIFICATION NUMBER (OR CERTIFICATION REGARDING FOREIGN STATUS) IS ON FILE WITH THE SUBSCRIPTION AGENT AND THE SELLER IS
NOT OTHERWISE SUBJECT TO U.S. BACKUP WITHHOLDING.
[ ] CHECK HERE IF RIGHTS ARE BEING EXERCISED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY DELIVERED TO THE SUBSCRIPTION
AGENT PRIOR TO THE DATE HEREOF AND COMPLETE THE FOLLOWING:
NAME(S) OF REGISTERED OWNER(S):
WINDOW TICKET NUMBER (IF ANY):
DATE OF EXECUTION OF NOTICE OF GUARANTEED DELIVERY:
NAME OF INSTITUTION WHICH GUARANTEED DELIVERY:
A-2
APPENDIX B
[Form of Notice of Guaranteed Delivery]
NOTICE OF GUARANTEED DELIVERY OF SUBSCRIPTION RIGHTS AND
THE SUBSCRIPTION PRICE FOR COMMON SHARES OF
BIOTIME, INC. SUBSCRIBED FOR IN THE RIGHTS OFFER
As set forth in the Prospectus under "The Rights Offer--Payment for
Shares," this form or one substantially equivalent may be used as a means of
effecting subscription and payment for all Common Shares of BioTime, Inc.
subscribed for in the Rights offer. Such form may be delivered by hand or sent
by facsimile transmission, overnight courier or mail to the Subscription Agent.
The Subscription Agent is:
American Stock Transfer & Trust Company
By Mail: By Facsimile:
American Stock Transfer & Trust Company (718) 234-5001
40 Wall Street Confirm by Telephone
New York, New York 10005 (718) 234-2700
By Hand: By Overnight Courier:
American Stock Transfer & Trust Company American Stock Transfer & Trust Company
40 Wall Street, 46th Floor 40 Wall Street, 46th Floor
New York, New York 10005 New York, New York 10005
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION OF
INSTRUCTIONS VIA A TELECOPY OR FACSIMILE NUMBER, OTHER THAN AS
SET FORTH ABOVE, DOES NOT CONSTITUTE A VALID DELIVERY
The New York Stock Exchange member firm or bank or trust company which
completes this form must communicate the guarantee and the number of shares
subscribed for to the Subscription Agent and must deliver this Notice of
Guaranteed Delivery guaranteeing delivery of (i) payment in full for all
subscribed shares (including any shares subscribed for through the
over-subscription privilege) and (ii) a properly completed and executed
Subscription Certificate (which certificate and full payment must then be
delivered by the close of business on the third business day after the
expiration date, as defined in the Prospectus) to the Subscription Agent prior
to 5:00 p.m., New York time, on the expiration date (______ , 1999, unless
extended). Failure to do so will result in a forfeiture of the Rights.
B-1
GUARANTEE
The undersigned, a member firm of the New York Stock Exchange or a bank or
trust company, guarantees delivery to the Subscription Agent by the close of
business (5:00 p.m., New York time) on the third business day after the
expiration date (______ , 1999, unless extended) of (A) a properly completed and
executed Subscription Certificate and (B) payment of the full subscription price
of shares subscribed for in the Rights offer (including the over-subscription
privilege, if applicable) as subscription for such Common Shares as indicated
herein or in the Subscription Certificate.
- ------------------------------------------- -----------------------------------------------
Number of Common Shares subscribed for Number of Common Shares subscribed for
(excluding the over-subscription privilege) pursuant to the over-subscription privilege for
for which you are guaranteeing delivery which you are guaranteeing delivery of
of Rights and payment Rights and payment
Number of Rights to be delivered: ------------------------------------------------
Total subscription price payment
to be delivered: $
------------------------------------------------
Method of delivery [circle one] A. Through DTC
B. Direct to Corporation
Please note that if you are guaranteeing for over-subscription shares, and
are a DTC participant, you must also execute and forward to American Stock
Transfer & Trust Company a Nominee Holder Over-Subscription Exercise Form.
- ------------------------------------------- -----------------------------------------------
Name of Firm Authorized Signature
- ------------------------------------------- -----------------------------------------------
Address Title
- ------------------------------------------- -----------------------------------------------
Zip Code (Type or Print)
- ------------------------------------------- -----------------------------------------------
Name of Registered Holder (If Applicable)
- ------------------------------------------- -----------------------------------------------
Telephone Number Date
* IF THE RIGHTS ARE TO BE DELIVERED THROUGH DTC, A REPRESENTATIVE OF THE
SUBSCRIPTION AGENT WILL PHONE YOU WITH A PROTECT IDENTIFICATION NUMBER, WHICH
NEEDS TO BE COMMUNICATED BY YOU TO DTC.
PLEASE NOTE THAT IF YOU ARE GUARANTEEING FOR OVER-SUBSCRIPTION SHARES AND ARE A
DTC PARTICIPANT, YOU MUST ALSO EXECUTE AND FORWARD TO THE SUBSCRIPTION AGENT A
NOMINEE HOLDER OVER-SUBSCRIPTION EXERCISE FORM.
B-2
APPENDIX C
[Form of Nominee Holder Over-Subscription Exercise Form]
BIOTIME, INC.
RIGHTS OFFER
NOMINEE HOLDER OVER-SUBSCRIPTION EXERCISE FORM
PLEASE COMPLETE ALL APPLICABLE INFORMATION
By Mail: By Hand: By Overnight Courier:
To: American Stock To: American Stock To: American Stock
Transfer & Trust Company Transfer & Trust Company Transfer & Trust Company
40 Wall Street 40 Wall Street, 46th Floor 40 Wall Street, 46th Floor
New York, New York 10005 New York, New York 10005 New York, New York 10005
THIS FORM IS TO BE USED ONLY BY NOMINEE HOLDERS TO EXERCISE THE OVER-SUBSCRIPTION PRIVILEGE IN RESPECT OF RIGHTS
WITH RESPECT TO WHICH THE SUBSCRIPTION RIGHTS WERE EXERCISED AND DELIVERED THROUGH THE FACILITIES OF A COMMON
DEPOSITORY. ALL OTHER EXERCISES OF OVER-SUBSCRIPTION PRIVILEGES MUST BE EFFECTED BY THE DELIVERY OF THE SUBSCRIPTION
CERTIFICATES.
--------------------
THE TERMS AND CONDITIONS OF THE RIGHTS OFFER ARE SET FORTH IN BIOTIME'S PROSPECTUS DATED _______, 1999 (THE
"PROSPECTUS") AND ARE INCORPORATED HEREIN BY REFERENCE. COPIES OF THE PROSPECTUS ARE AVAILABLE UPON REQUEST FROM
BIOTIME.
--------------------
VOID UNLESS RECEIVED BY THE SUBSCRIPTION AGENT WITH PAYMENT IN FULL BY 5:00 P.M., NEW YORK TIME, ON , 1999, UNLESS
EXTENDED BY BIOTIME (THE "EXPIRATION DATE").
1. The undersigned hereby certifies to the Subscription Agent that it is a participant in [Name of Depository] (the
"Depository") and that it has either (i) exercised all of the Rights and delivered such exercised Rights to the
Subscription Agent by means of transfer to the Depository Account of BioTime, Inc., or (ii) delivered to the
Subscription Agent a Notice of Guaranteed Delivery in respect of the exercise of the Rights and will deliver the
Rights called for in such Notice of Guaranteed Delivery to the Subscription Agent by means of transfer to such
Depository Account of BioTime, Inc.
2. The undersigned hereby exercises the over-subscription privilege to purchase, to the extent available, Common
Shares and certifies to the Subscription Agent that such over-subscription privilege is being exercised for the
account or accounts of persons (which may include the undersigned) on whose behalf all Rights have been
exercised.(*)
3. The undersigned understands that payment of the subscription price of $______ per share for each Common Share
subscribed for pursuant to the over-subscription privilege must be received by the Subscription Agent at or before
5:00 p.m., New York time, on the Expiration Date, and represents that such payment, in the aggregate amount of
$______ either (check appropriate box):
[ ] has been or is being delivered to the Subscription Agent pursuant to the Notice of Guaranteed Delivery referred
to above or;
[ ] is being delivered to the Subscription Agent herewith or;
[ ] has been delivered separately to the Subscription Agent; and, in the case of funds not delivered pursuant to a
Notice of Guaranteed Delivery, is or was delivered in the manner set forth below (check appropriate box and
complete information relating thereto):
[ ] uncertified check
[ ] certified check
[ ] bank draft
[ ] money order
------------------------------------------------------ --------------------------------------------------
Depository Subscription Confirmation Number Name of Nominee Holder
------------------------------------------------------ --------------------------------------------------
Depository Participant Number Address
--------------------------------------------------
Contact Name _________________________________________ City State Zip Code
By: ______________________________________________
Phone Number _________________________________________
Name: ____________________________________________
Dated: ______, 1999 Title: ___________________________________________
* PLEASE COMPLETE THE BENEFICIAL OWNER CERTIFICATION ON THE BACK HEREOF CONTAINING THE RECORD DATE POSITION OF
RIGHTS OWNED, THE NUMBER OF SHARES SUBSCRIBED FOR (OTHER THAN OVER-SUBSCRIPTIONS) AND THE NUMBER OF
OVER-SUBSCRIPTION SHARES, IF APPLICABLE, REQUESTED BY EACH SUCH OWNER.
C-1
BIOTIME, INC.
BENEFICIAL OWNER CERTIFICATION
The undersigned, a bank, broker or other nominee holder of Rights ("Rights") to purchase Common Shares, no par
value ("Common Shares"), of BioTime, Inc. ("BioTime") pursuant to the Rights offer described and provided for in
BioTime's Prospectus dated _______, 1999 (the "Prospectus") hereby certifies to BioTime and to American Stock Transfer &
Trust Company, as Subscription Agent for such Rights offer, that for each numbered line filled in below the undersigned
has exercised, on behalf of the beneficial owner thereof (which may be the undersigned), the number of Rights specified
on such line, and such beneficial owner wishes to subscribe for the purchase of additional Common Shares pursuant to the
over-subscription privilege (as defined in the Prospectus), in the amount set forth in the third column of such line:
Number of Shares Requested Pursuant to the
Record Date Shares Number of Rights Exercised Over-Subscription Privilege
------------------ -------------------------- ---------------------------
1) ______________________ __________________________________ _____________________________________________
2) ______________________ __________________________________ _____________________________________________
3) ______________________ __________________________________ _____________________________________________
4) ______________________ __________________________________ _____________________________________________
5) ______________________ __________________________________ _____________________________________________
6) ______________________ __________________________________ _____________________________________________
7) ______________________ __________________________________ _____________________________________________
8) ______________________ __________________________________ _____________________________________________
9) ______________________ __________________________________ _____________________________________________
10) ______________________ __________________________________ _____________________________________________
- --------------------------------------------------- ---------------------------------------------------------
Name of Nominee Holder Depository Participant Number
- --------------------------------------------------- ---------------------------------------------------------
Name: Depository Primary Subscription
Title: Confirmation Number(s)
Dated: ______, 1999
C-2
================================================================================
No dealer, salesperson or other person has been authorized in connection with
this offering to give any information or to make any representations other than
those contained in this Prospectus. This Prospectus does not constitute an
offer or a solicitation in any jurisdiction to any person to whom it is
unlawful to make such an offer or solicitation. Neither the delivery of this
Prospectus nor any sale made hereunder shall, under any circumstances, create
an implication that there has been no change in the circumstances of BioTime or
the facts herein set forth since the date hereof.
TABLE OF CONTENTS
Prospectus Summary ......................................................... 3
Risk Factors ............................................................... 7
The Company ................................................................ 10
The Rights Offer ........................................................... 12
Use of Proceeds ............................................................ 19
Description of Securities .................................................. 20
Legal Matters .............................................................. 20
Experts .................................................................... 20
Incorporation of Certain Information by
Reference ............................................................... 21
Additional Information ..................................................... 21
Form of Subscription Certificate ................................... Appendix A
Form of Notice of Guaranteed
Delivery ........................................................ Appendix B
Form of Nominee Holder
Over-Subscription Exercise
Form ............................................................ Appendix C
================================================================================
================================================================================
BIOTIME, INC.
[Graphic Omitted]
501,654 Common Shares
Issuable Upon the Exercise of
Subscription Rights
----------------
PROSPECTUS
----------------
______, 1999
================================================================================
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses of the Registrant in connection with the issuance
and distribution of the securities being registered hereby are as follows:
Registration Fee--Securities and Exchange Commission ...... $ 2,736.28
NASDAQ Listing Fee .......................................... $ 25,032.58
Printing and Engraving Expenses ........................... $ 10,000.00
Accounting Fees ............................................. $ 25,000.00
Legal Fees ................................................ $ 25,000.00
Subscription Agent ....................................... $ 25,000.00
Miscellaneous Expenses .................................... $ 2,231.14
-----------
Total ....................................................$115,000.00
===========
------------
Item 15. Indemnification of Directors and Officers.
Section 317 of the California Corporations Code permits indemnification of
directors, officers, employees and other agents of corporations under certain
conditions and subject to certain limitations. In addition, Section 204(a)(10)
of the California Corporations Code permits a corporation to provide, in its
articles of incorporation, that directors shall not have liability to the
corporation or its shareholders for monetary damages for breach of fiduciary
duty, subject to certain prescribed exceptions. Article Four of the Articles of
Incorporation of the Registrant contains provisions for the indemnification of
directors, officers, employees and other agents within the limitations
permitted by Section 317 and for the limitation on the personal liability of
directors permitted by Section 204(b)(10), subject to the exceptions required
thereby.
Item 16. Exhibits and Financial Statement Schedules.
Exhibit
Numbers Description
------- -----------
4.1 Specimen of Common Share Certificate.+
4.4 Form of Subscription Certificate.++
5 Opinion of Counsel++
23.1 Consent of Deloitte & Touche LLP++
23.2 Consent of Counsel (included in opinion of counsel filed as Exhibit 5)
+ Incorporated by reference to Registration Statement on Form S-1, File Number
33-44549 filed with the Securities and Exchange Commission on December 18,
1991, and Amendment No. 1 and Amendment No. 2 thereto filed with the
Securities and Exchange Commission on February 6, 1992 and March 7, 1992,
respectively.
++ Filed herewith.
II-1
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than payment by the Registrant
of expenses incurred or paid by a director, officer or controlling person of
the Registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by final
adjudication of such issue.
The undersigned registrant hereby undertakes:
(1) To file during any period in which offers or sales are made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate represent a fundamental change in the information set forth in
the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
(2) That for the purpose of determining any liability under the
Securities Act of 1933, 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.
The undersigned undertakes that:
(1) For the purposes 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 shall be deemed to be
part of this registration statement as of the time it was declared
effective.
(2) For the 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 bona fide offering thereof.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment to the Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of
Berkeley, State of California on January 27, 1999.
BIOTIME, INC.
By: /s/ Paul Segall
------------------------------------
Paul Segall, Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:
Signature Title Date
--------- ----- ----
/s/ Paul Segall Chief Executive Officer and Director January 27, 1999
- --------------------------- (Principal Executive Officer)
PAUL SEGALL
/s/ Ronald S. Barkin President and Director January 27, 1999
- ---------------------------
RONALD S. BARKIN
/s/ Harold Waitz Vice President and Director January 27, 1999
- ---------------------------
HAROLD WAITZ
/s/ Hal Sternberg Vice President and Director January 27, 1999
- ---------------------------
HAL STERNBERG
/s/ Victoria Bellport Chief Financial Officer and Director January 27, 1999
- --------------------------- (Principal Financial and Accounting
VICTORIA BELLPORT Officer)
/s/ Judith Segall Secretary and Director January 27, 1999
- ---------------------------
JUDITH SEGALL
Director January , 1999
- ---------------------------
JEFFREY B. NICKEL
Director January , 1999
- ---------------------------
MILTON H. DRESNER
II-3
EXHIBIT INDEX
Exhibit
Numbers Description
- --------- ----------------------------------------
4.1 Specimen of Common Share Certificate.+
4.4 Form of Subscription Certificate.++
5 Opinion of Counsel.++
23.1 Consent of Deloitte & Touche LLP.++
23.2 Consent of Counsel (included in opinion of counsel filed as Exhibit 5)
- ------------
+ Incorporated by reference to Registration Statement on Form S-1, File Number
33-44549 filed with the Securities and Exchange Commission on December 18,
1991, and Amendment No. 1 and Amendment No. 2 thereto filed with the
Securities and Exchange Commission on February 6, 1992 and March 7, 1992,
respectively.
++ Filed herewith.
CONTROL NUMBER BIOTIME, INC. SUBSCRIPTION CERTIFICATE FOR
SUBSCRIPTION CERTIFICATE FOR COMMON SHARES
VOID IF NOT EXERCISED AT OR BEFORE 5:00 P.M.
(NEW YORK TIME) ON ______, 1999, THE EXPIRATION DATE. RIGHTS
THIS SUBSCRIPTION CERTIFICATE IS TRANSFERRABLE
AND MAY BE COMBINED OR DIVIDED
Expiration Date (BUT ONLY INTO SUBSCRIPTION SUBSCRIPTION PRICE
______, 1999 CERTIFICATES EVIDENCING A WHOLE NUMBER OF RIGHTS) U.S. $______
AT THE OFFICE OF THE SUBSCRIPTION AGENT PER SHARE
CUSIP
09066L 12 1
THIS SUBSCRIPTION CERTIFICATE MAY BE USED TO SUBSCRIBE FOR
COMMON SHARES OR MAY BE ASSIGNED OR SOLD. FULL INSTRUCTIONS
APPEAR ON THE BACK OF THIS SUBSCRIPTION CERTIFICATE.
REGISTERED OWNER:
The registered owner of this Subscription Certificate, named above, or assignee,
is entitled to the number of Rights to subscribe for Common Shares, no par
value, of BioTime, Inc. shown above, in the ratio of one Common Share for each
20 Rights held, and upon the terms and conditions and at the price for each
Common Share specified in the Prospectus dated ______, 1999.
If you exercise fewer than all the Rights represented by this Subscription
Certificate, the subscription agent will issue a new Subscription Certificate
representing the balance of the unexercised Rights, provided that the
subscription agent has received your properly completed and executed
Subscription Certificate and payment prior to 5:00 p.m., New York time, on
______, 1999. No new Subscription Certificate will be issued after that date.
IMPORTANT: Complete appropriate form on reverse
DATE: , 1999
BIOTIME, INC.
- --------------------------------------------------------------------------------
SECRETARY
- --------------------------------------------------------------------------------
CHIEF EXECUTIVE OFFICER
Countersigned: American Stock Transfer & Trust Company (New York, N.Y.)
Subscription Agent
By: ___________________________________________
Authorized Signature
EXHIBIT 4.4
Expiration Date: ______, 1999
PLEASE COMPLETE ALL APPLICABLE INFORMATION
By Mail: By Hand: By Overnight Courier:
To: America Stock To: America Stock To: American Stock
Transfer & Trust Company Transfer & Trust Company Transfer & Trust Company
40 Wall Street 40 Wall Street, 46th Floor 40 Wall Street, 46th Floor
New York, New York 10005 New York, New York 10005 New York, New York 10005
SECTION 1: TO SUBSCRIBE: I hereby irrevocably subscribe for the dollar amount
of common shares indicated as the total of A and B below upon the terms
and conditions specified in the Prospectus related hereto, receipt of
which is acknowledged.
TO SELL: If I have checked either the box on line C or the box on line
D, I authorize the sale of Rights by the subscription agent according
to the procedures described in the Prospectus. The check for the
proceeds of sale will be mailed to the address of record.
Please check [X] below:
[ ] A. Subscription divided by 20 = .000 x $ = $
------------------ ------------------ -------------------- ----------------
(Rights Exercised) (Shares Requested) (Subscription Price) (Amount Required)
[ ] B. Over-Subscription Privilege .000 x $ = $ (*)
------------------ -------------------- -------------------
(Shares Requested) (Subscription Price) (Amount Required)
Amount of Check Enclosed or Amount in Notice of Guaranteed Delivery (total of A + B) = $
--------------------
Make check payable to the order of "BioTime, Inc."
(*) The over-subscription privilege can be exercised by certain shareholders only, as described in the
Prospectus.
[ ] C. Sell any remaining unexercised Rights
[ ] D. Sell all of my Rights.
_______________________________________ Please provide your telephone number Day (___)___________________________
Signature of Subscriber(s)/Seller(s) Evening (___)___________________________
Social Security Number or Tax ID Number: _______________________________________________
SECTION II: TO TRANSFER RIGHTS: (except pursuant to C and D above)
For value received, __________________________ of the Rights represented by this Subscription Certificate are assigned to
- ---------------------------------------------------------- ----------------------------------------------------------
Social Security Number or Tax ID Number of Assignee (Print Full Name of Assignee
- ---------------------------------------------------------- ----------------------------------------------------------
Signature(s) of Assignor(s) (Print Full Address including postal Zip Code)
The signature(s) must correspond with the name(s) as written upon the face of this Subscription Certificate, in every
particular, without alteration.
IMPORTANT: For transfer, a signature guarantee must be provided by an eligible financial institution which is a participant
in a recognized signature guarantee program.
SIGNATURE GUARANTEED BY:
- ------------------------------------
PROCEEDS FROM THE SALE OF RIGHTS MAY BE SUBJECT TO WITHHOLDING OF U.S. TAXES UNLESS THE SELLER'S CERTIFIED U.S. TAXPAYER
IDENTIFICATION NUMBER (OR CERTIFICATION REGARDING FOREIGN STATUS) IS ON FILE WITH THE SUBSCRIPTION AGENT AND THE SELLER IS
NOT OTHERWISE SUBJECT TO U.S. BACKUP WITHHOLDING.
[ ] CHECK HERE IF RIGHTS ARE BEING EXERCISED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY DELIVERED TO THE SUBSCRIPTION
AGENT PRIOR TO THE DATE HEREOF AND COMPLETE THE FOLLOWING:
NAME(S) OF REGISTERED OWNER(S):
WINDOW TICKET NUMBER (IF ANY):
DATE OF EXECUTION OF NOTICE OF GUARANTEED DELIVERY:
NAME OF INSTITUTION WHICH GUARANTEED DELIVERY:
Exhibit 5
LAW OFFICES
LIPPENBERGER, THOMPSON, WELCH, SOROKO & GILBERT LLP
250 MONTGOMERY STREET
SUITE 500
SAN FRANCISCO, CA 94104-3401
(415) 421-5300
FACSIMILE
(415) 421-0225
January 26, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: BioTime, Inc.
Registration Statement on Form S-3
Ladies/Gentlemen:
We are counsel to BioTime, Inc. (the "Company") in connection with the
offer and sale of up to 751,654 Common Shares (the "Shares"), including 501,654
Shares issuable upon the exercise of subscription rights (the "Rights") that
will be issued and distributed by the Company to the holders of record of its
Common Shares, plus up to an additional 250,000 Shares that may be issued to
fill over-subscriptions of those Rights. The Company will issue one Right for
each Common Share that was outstanding on January 5, 1999, which has been set
as the record date for determining shareholders entitled to receive the Rights.
The issuance of the Rights and the offer and sale of the Shares is being
registered under the Securities Act of 1933, as amended, pursuant to a
Registration Statement on Form S-3, File No. 333-69179.
We are of the opinion that when the Rights are granted as described in the
Registration Statement, the Rights will be the legally and validly issued and
outstanding and will constitute binding obligations of the Company, enforceable
in accordance with their terms. We are also of the opinion that when the Shares
are issued and sold upon the exercise of the Rights and to fill
over-subscriptions, in accordance with the terms and provisions of the Rights
and the Registration Statement, the Shares will be legally and validly issued
and outstanding, fully paid and nonassessable.
The foregoing opinion is limited to the laws of the State of California
and the Federal laws of the United States of America.
We hereby consent to the use of our opinion in the Registration Statement.
Very truly yours,
Lippenberger, Thompson, Welch, Soroko & Gilbert LLP
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Amendment No. 1 to
Registration Statement No. 333-69179 of BioTime, Inc. on Form S-3 of our report
dated August 18, 1998 (which expresses an unqualified opinion and includes an
explanatory paragraph related to the development stage of the Company's
operations), appearing in Annual Report on Form 10-K of BioTime, Inc. for the
year ended June 30, 1998 and to the reference to us under the heading "Experts"
in the Prospectus, which is part of this Registration Statement.
DELOITTE & TOUCHE LLP
San Francisco, California
January 27, 1999
