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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): DECEMBER 13, 2004
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CRYOLIFE, INC.
(Exact name of registrant as specified in its charter)
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FLORIDA 1-13165 59-2417093
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
1655 ROBERTS BOULEVARD, N.W., KENNESAW, GEORGIA 30144
(Address of principal executive office) (zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (770) 419-3355
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(Former name or former address, if changed since last report)
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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SECTION 1 REGISTRANT'S BUSINESS AND OPERATIONS.
ITEM 1.02. TERMINATION OF A MATERIAL DEFINITIVE CONTRACT.
See Item 8.01 below, regarding the termination of employment of two former
officers of CryoLife, Inc. (the "Company" or "CryoLife"), which may be deemed to
be material.
SECTION 8 OTHER EVENTS.
ITEM 8.01. OTHER EVENTS.
On January 10, 2005, CryoLife issued a press release relating to a new
development and marketing agreement with Endologix, Inc. CryoLife hereby
incorporates by reference herein the information set forth in its Press Release
dated January 10, 2005, a copy of which is attached hereto as Exhibit 99.1.
As previously announced, on December 13, 2004, Dr. Kirby Black resigned as
CryoLife's Senior Vice President of Research and Development. His written
employment agreement had previously expired according to its terms. He continued
employment with CryoLife under an at-will arrangement at an annualized salary of
$253,000 until December 13, 2004.
On December 14, 2004, Albert E. Heacox, PhD, assumed the position of Senior Vice
President of Research and Development with CryoLife. CryoLife hereby
incorporates by reference herein the information set forth in its press release
dated December 14, 2004, a copy of which is attached as Exhibit 99.2.
On December 14, 2004, Dr. James C. Vander Wyk's employment as Vice President,
Product Integrity with CryoLife terminated. Dr. Vander Wyk worked under an
employment agreement entered into in September 2002 at an annual salary of
$240,000. Upon his departure, CryoLife agreed to pay the severance amount
provided for in his employment agreement of eighteen months of base salary. For
more than six months prior to his departure, Dr. Vander Wyk was not in a policy
making position at the Company. His primary responsibilities during that time
were to assist the Company in defending against several lawsuits.
This Form 8-K also is filed to include a copy of the Form of Indemnification
Agreement, previously reported, for the Directors and Chief Financial Officer of
the Company.
CryoLife has entered into indemnification agreements with each of its directors
and its Chief Financial Officer ("Indemnitees"). Pursuant to such agreements,
CryoLife shall indemnify each Indemnitee whenever he or she is or was a party or
is threatened to be made a party to any proceeding, including without limitation
any such proceeding brought by or in the right of CryoLife, because he or she is
or was a director or officers of CryoLife or is or was serving at the request of
CryoLife as a director or officer of another corporation, partnership, joint
venture, trust or other enterprise, or because of anything done or not done by
the Indemnitee in such capacity, against expenses and liabilities (including the
costs of any investigation, defense, settlement or appeal) actually and
reasonably incurred by the Indemnitee or on his or her behalf in connection with
such proceeding, if he or she acted in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of CryoLife,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his or her conduct was unlawful. The termination of any action suit
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or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that an
Indemnitee did not act in good faith and in a manner which he or she reasonably
believed to be in or not opposed to the best interests of CryoLife, and, with
respect to any criminal action or proceeding, had reasonable cause to believe
that his or her conduct was unlawful. Unless a determination has been made that
the Indemnitee is not entitled to indemnification pursuant to the agreement, all
reasonable expenses incurred by or on behalf of such Indemnitee shall be
advanced from time to time by CryoLife to the Indemnitee within thirty (30) days
after CryoLife's receipt of a written request for an advance of expenses by such
Indemnitee, whether prior to or after final disposition of a proceeding. If
required by law, Indemnitee shall agree, at the time of such advance, to repay
the amounts advanced if it is ultimately determined that Indemnitee is not
entitled to be indemnified under the terms of the agreement. Any advances made
shall be unsecured and no interest shall be charged thereon.
The indemnification agreements were executed by the Company and each Indemnitee
on the date indicated on Exhibit 10.50.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "1933 Act"), may be permitted to directors, officers or persons
controlling CryoLife pursuant to the foregoing provisions of the Georgia
Business Corporation Code and CryoLife's articles of incorporation and bylaws,
CryoLife has been informed that indemnification is considered by the Commission
to be against public policy and therefore unenforceable.
ITEM 9.01(C) EXHIBITS.
Exhibit Number Description
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10.50 Form of Indemnification Agreement for Directors and
Chief Financial Officer of the Registrant (incorporated by
reference to Exhibit 99.1 to the Registrant's Registration
Statement on Form S-3 (File No. 333-121406)).
99.1 Press Release dated January 10, 2005
99.2 Press Release dated December 14, 2004
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
CryoLife, Inc. has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CRYOLIFE, INC.
Date: January 12, 2005 By: /s/ D. Ashley Lee
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Name: D. Ashley Lee
Title: Executive Vice President,
Chief Operating Officer and Chief
Financial Officer
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EXHIBIT INDEX
Exhibit Number Description
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10.50 Form of Indemnification Agreement for Directors and
Chief Financial Officer of the Registrant (incorporated by
reference to Exhibit 99.1 to the Registrant's Registration
Statement on Form S-3 (File No. 333-121406)).
99.1 Press Release dated January 10, 2005
99.2 Press Release dated December 14, 2004
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EXHIBIT 99.1
[CRYOLIFE COMPANY LOGO] [ENDOLOGIX COMPANY LOGO]
NEWS RELEASE
JANUARY 10, 2005
CRYOLIFE CONTACT: ENDOLOGIX CONTACTS:
Joseph T. Schepers Paul McCormick
VP, Corporate Communications President & CEO
(770) 419-3355 (949) 595-7200
ENDOLOGIX INVESTOR CONTACTS:
Lippert/Heilshorn & Associates
Bruce Voss/Jody Cain
(310) 691-7100
CRYOLIFE AND ENDOLOGIX SIGN DEVELOPMENT AGREEMENT FOR BIOFOAM
ENDOLOGIX TO DEVELOP CRYOLIFE'S INNOVATIVE,
SELF-EXPANDING SEALANT AS A FILLING AGENT FOR AORTIC ANEURYSMS
ATLANTA, GA. AND IRVINE, CALIF. (JANUARY 10, 2005) - CRYOLIFE, INC. (NYSE: CRY)
AND ENDOLOGIX, INC. (NASDAQ: ELGX) today announced the signing of a development
and marketing agreement for the percutaneous or endovascular delivery of
CryoLife's BioFoam(TM) as a self-expanding sealant for endovascular aortic
aneurysm grafts. Under the agreement, Endologix will be responsible for
preclinical, clinical, and regulatory activities and costs, and CryoLife will
manufacture BioFoam for clinical use and commercial sale and receive a royalty
on potential future product sales.
BioFoam is a protein hydrogel adhesive in preclinical development. The product
contains an expansion agent, which has the potential to rapidly fill and seal
internal body cavities, such as aneurysm sacs, and provide hemostasis in
penetrating wounds and severe trauma. BioFoam is based on the same platform
technology as CryoLife's BioGlue(R), which is FDA approved to control bleeding
as an adjunct to sutures and staples in the open surgical repair of large
vessels. BioGlue is CE marked in the European Community and approved in Canada
for use in soft tissue repair.
"BioFoam represents an outstanding business opportunity for Endologix, using a
well-described and often-used predicate in open surgical procedures in a market
that Endologix currently serves," said Paul McCormick, Endologix president and
chief executive officer. "Endoleaks, or blood flow into an excluded aneurysm
sac, are a significant factor for mid- and long-term failure of endovascular
aneurysm repair. Our near-term focus will be on developing BioFoam as an
effective agent for percutaneous treatment of endoleaks, irrespective of stent
graft manufacturer, while longer-term, BioFoam has the potential to make
minimally invasive treatment of abdominal aortic aneurysms (AAA) a more durable
procedure."
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"BioFoam is an innovative and versatile product that should prove effective in
multiple medical applications," said Steven G. Anderson, CryoLife president and
chief executive officer. "Through agreements with companies with specialized
skills and market access, such as Endologix, we expect to improve the value of
this asset with application-specific development and to receive a royalty on
product sales and earn a manufacturing margin. We are delighted to enter into
this agreement with Endologix, and look forward to moving BioFoam into clinical
development."
Endologix intends to begin preclinical development of BioFoam during the first
quarter of 2005, and to start clinical testing for the treatment of type 2
endoleaks in mid-year 2006.
"With our Powerlink(R) System, we are addressing the failings of
first-generation endoluminal stent grafts (ELG), and with BioFoam, we are
addressing the entirety of the ELG procedure to make this approach the standard
of care," added Mr. McCormick. "We are pleased to further establish our position
of industry leadership and product innovation."
ABOUT CRYOLIFE
Founded in 1984, CryoLife, Inc. is a leader in the processing and distribution
of implantable human tissues for use in cardiovascular and vascular surgeries
throughout the United States and Canada. CryoLife's BioGlue Surgical Adhesive is
FDA approved as an adjunct to sutures and staples for use in adult patients in
open surgical repair of large vessels and is CE marked in the European Community
and approved in Canada for use in soft tissue repair and approved in Australia
for use in vascular and pulmonary sealing and repair. CryoLife also manufactures
the SG Model #100 vascular graft, which is CE marked for distribution within the
European Community. For additional information about CryoLife, visit CryoLife's
web site: www.cryolife.com.
ABOUT ENDOLOGIX
Endologix, Inc. develops and manufactures minimally invasive treatments for
vascular diseases. Endologix's Powerlink System is an endoluminal stent graft
for treating abdominal aortic aneurysms (AAA). AAA is a weakening of the wall of
the aorta, the largest artery in the body, resulting in a balloon-like
enlargement. Once AAA develops, it continues to enlarge and, if left untreated,
becomes increasingly susceptible to rupture. The overall patient mortality rate
for ruptured AAA is approximately 75%, making it the thirteenth leading cause of
death in the United States. In October 2004, Endologix received approval to
market the Powerlink in the U.S. Additional information can be found on
Endologix's web site at www.endologix.com.
CRYOLIFE SAFE HARBOR STATEMENT: Statements made in this press release that look
forward in time or that express CryoLife's management's beliefs, expectations or
hopes are forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These future events may not occur as
and when expected, if at all, and, together with CryoLife's business, are
subject to various risks and uncertainties. These risks and uncertainties
include that BioFoam may not prove effective for percutaneous treatment of
endoleaks or make minimally invasive treatment of AAA a more durable procedure,
that the licensed use for BioFoam may not prove commercially feasible, that the
proposed use may not receive appropriate regulatory approval, that the proposed
use may infringe the proprietary rights of third parties, that royalties and
manufacturing margins on product sales from the agreement may not meet
expectations, that the Company's revenues and expenses may not meet its
expectations, that demand for CryoLife preserved tissues may not return to
prior levels, the possibility that the FDA could impose additional restrictions
on CryoLife's operations, require a recall, or prevent CryoLife from
manufacturing and distributing BioFoam, that to the extent CryoLife does not
have sufficient resources to pay the claims against it, it may be forced to
cease operations or seek protection under applicable bankruptcy laws, changes in
laws and regulations applicable to CryoLife and other risk factors detailed in
the company's Securities and Exchange Commission filings, including Form 10-K
filing for the year ended December 31, 2003, and other SEC filings. CryoLife
undertakes to update its forward-looking statements.
ENDOLOGIX SAFE HARBOR STATEMENT: Except for historical information contained
herein, this news release contains forward-looking statements, the accuracy of
which are necessarily subject to risks and uncertainties, including risks
related to the development, clinical success and regulatory approval of a new
medical device product, and the risks related to intellectual property rights
surrounding new technology, all of which are difficult or impossible to predict
accurately and many of which are beyond the control of Endologix, all as more
fully described in the risk factors and other matters set forth in the Company's
Annual Report on Form 10-K for the year ended December 31, 2003, and the
Company's other filings with the SEC.
# # #
EXHIBIT 99.2
PRESS RELEASE Source: CryoLife, Inc.
Albert E. Heacox, Ph.D. Assumes Senior Vice
President of Research and Development
Position for CryoLife, Inc.
Tuesday December 14, 8:30 am ET
ATLANTA, Dec. 14 /PRNewswire-FirstCall/ -- CryoLife, Inc. (NYSE: CRY - News) a
biomaterials and biosurgical device company, announced today that Albert E.
Heacox, Ph.D. has assumed the position of Senior Vice President of Research and
Development of CryoLife, Inc. Reporting to Dr. Heacox will be CryoLife's
Research and Development Laboratory, Product and Process Engineering and
Aurazyme Pharmaceuticals' Research Department. Dr. Heacox, (54) joined CryoLife
in 1985 as Director of Laboratory Operations. In 1989 he was promoted to Vice
President of Laboratory Operations and then in 2000 he was promoted to Senior
Vice President of Laboratory Operations for the Company. In his new position he
will continue to report to Steven G. Anderson, President and CEO of CryoLife.
Albert E. Heacox completed his B.S. and M.S. degrees in biology at Adelphi
University in New York in 1971 and 1974 respectively. In 1980 he received his
Ph.D. in zoology from Washington State University. In 1981 he completed his
post-doctorate training in cell biology from The University of Cologne in
Germany. Prior to joining CryoLife in 1985, he was a research scientist for the
U.S. Department of Agriculture in Fargo, North Dakota. He replaces Kirby S.
Black, Ph.D. who resigned to pursue other interests.
"CryoLife has an extensive portfolio of new products in the Company's research
pipeline and Al Heacox is the perfect person to bring these new technologies and
products to fruition," said Steven G. Anderson, President and CEO. "In addition,
Dr. Heacox has over twenty years experience in preserving mammalian cells and
tissues and will shepherd the Company's many new tissue preservation and
materials technologies going forward." Anderson added, "We wish Dr. Black the
best in his new endeavors and thank him for his many contributions to CryoLife."
About CryoLife, Inc.
Founded in 1984, CryoLife, Inc. is a leader in the processing and distribution
of implantable living human tissues for use in cardiovascular and vascular
surgeries throughout the United States and Canada. The Company's BioGlue
Surgical Adhesive is FDA approved as an adjunct to sutures and staples for use
in adult patients in open surgical repair of large vessels and is CE marked in
the European Community and approved in Canada for use in soft tissue repair and
approved in Australia for use in vascular and pulmonary sealing and repair. The
Company also manufactures the SG Model #100 vascular graft, which is CE marked
for distribution within the European Community.
For additional information about the company, visit CryoLife's web site:
http://www.cryolife.com
Contact: Joseph T. Schepers
Vice President, Corporate Communications (770) 419-3355
Source: CryoLife, Inc.