UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
40-F
[ ]
REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF
1934
OR
[
X ] ANNUAL REPORT PURSUANT TO SECTION 13(A) OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For
the fiscal year ended
October 31,
2009
|
Commission
File Number___
001-15016
|
MDS
INC.
(Exact
name of Registrant as specified in its charter)
|
Canada
(Federal)
(Province
or other jurisdiction of incorporation or organization)
|
8099
(Primary
Standard Industrial Classification Code Number (if
applicable))
|
98-0170107
(I.R.S.
Employer Identification Number (if applicable))
|
Suite
500
2810
Matheson Blvd., East
Mississauga,
Ontario, Canada L4W 4X7
(905)
267-4222
(Address
and telephone number of Registrant's principal executive
offices)
|
MDS
Pharma Services (US) Inc.
621
Rose Street, P.O. Box 80837, Lincoln, Nebraska
68501
(402)
476-2811
(Name,
address (including zip code) and telephone number (including area
code)
of
agent for service in the United
States)
|
Securities
registered or to be registered pursuant to Section 12(b) of the
Act:
Title of each class
|
Name of each exchange on which
registered
|
Common
Shares, no par value
|
New
York Stock Exchange
|
|
|
Securities
registered or to be registered pursuant to Section 12(g) of the
Act:
Securities
for which there is a reporting obligation pursuant to Section 15(d) of the
Act:
For
annual reports, indicate by check mark the information filed with this
Form:
[ X
] Annual Information Form
|
[X]
Audited Annual Financial Statements
|
Indicate
the number of outstanding shares of each of the issuer's classes of capital or
common stock as of the close of the period covered by the annual
report:
The Registrant had 120,137,229 Common
Shares outstanding as at October 31, 2009.
Indicate
by check mark whether the Registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months
(or for such shorter period that the Registrant was required to file such
reports) and (2) has been subject to such filing requirements for the past 90
days.
Yes [ X ] No
[ ]
Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
Registrant was required to submit and post such files).
Yes [ ] No
[ X ]
A. Disclosure
Controls and Procedures
Disclosure
controls and procedures are defined by the Securities and Exchange Commission
(the “Commission”) as those controls and other procedures that are designed to
ensure that information required to be disclosed by the Registrant in reports
filed or submitted by it under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), is recorded, processed, summarized and reported within the
time periods specified in the Commission’s rules and forms.
The
Registrant’s Chief Executive Officer and Chief Financial Officer have evaluated
the effectiveness of the Registrant’s disclosure controls and procedures and
have concluded that such disclosure controls and procedures were not effective
as at October 31, 2009 as a result of the material weakness described in the
Registrant’s internal control over financial reporting discussed on
pages 38 to 40 of the Management’s Discussion and Analysis of
Financial Condition and Results of Operations for the fiscal year ended October
31, 2009 filed as Exhibit No. 1.3 to this Annual Report on Form 40-F, under the
heading “Disclosure controls and procedures”.
B. Management's
Annual Report on Internal Control over Financial Reporting
See
Management’s Discussion and Analysis of Financial Condition and Results of
Operations for the fiscal year ended October 31, 2009 filed as Exhibit No. 1.3
to this Annual Report on Form 40-F, under the heading “Management's annual
report on internal control over financial reporting”.
C. Attestation
Report of the Registered Public Accounting Firm
The
attestation report of Ernst & Young LLP (the “Independent Auditors”) is
included in the Independent Auditors’ report to the shareholders of the
Registrant, dated January 25, 2010, which accompanies the Registrant’s audited
consolidated financial statements for the fiscal year ended October 31, 2009,
filed as Exhibit 1.2 to this Annual Report on Form 40-F.
D. Changes
in Internal Control over Financial Reporting
See Management’s Discussion and Analysis of
Financial Condition and Results of Operations for the fiscal year ended October
31, 2009, filed as Exhibit No. 1.3 to this Annual Report on Form 40-F, under the
heading “Changes in internal control over financial reporting”.
E. Notice
of Pension Fund Blackout Period
The
Registrant was not required by Rule 104 of Regulation BTR to send any notice to
any of its directors or executive officers during the fiscal year ended October
31, 2009.
F. Audit
Committee Financial Expert
The
Registrant’s board of directors (the “Board”) has determined that all of the
members of the Registrant’s Audit Committee are “independent” within the meaning
of applicable SEC regulations and the listing standards of the New York Stock
Exchange (the “NYSE”). In addition, the Board has determined that Mr. William D.
Anderson, the Chair of the Audit Committee and Mr. Robert W. Luba are audit
committee financial experts within the meaning of General Instruction B(8)(b) of
Form 40-F under the Exchange Act.
The
Commission has indicated that the designation of a person as an audit committee
financial expert does not make such person an “expert” for any purpose, impose
any duties, obligations or liability on such person that are greater than those
imposed on members of the Audit Committee and the Board of Directors who do not
carry this designation or affect the duties, obligations or liability of any
other member of the Audit Committee or Board of Directors.
G. Code
of Ethics
The
Registrant’s code of ethics, entitled Global Business Practice Standards, is
applicable to all of its employees including the Chief Executive Officer, Chief
Financial Officer and other senior officers. The code of ethics can be viewed on
the Registrant’s website at
www.mdsinc.com/pdf/Global_Business%20Practices.pdf.
H. Principal
Accountant Fees and Services
(All
amounts are in U.S. dollars unless otherwise indicated)
Audit
Fees
The
aggregate fees billed by the Independent Auditors for professional services
rendered for the audit of the Registrant’s annual financial statements,
including services related thereto, were $4,853,000 for the fiscal year ended
October 31, 2009 and $6,100,000 for the fiscal year ended October 31,
2008. These engagements include the opinion issued on the
consolidated financial statements of the Registrant and its subsidiaries as
required by statute in certain jurisdictions, and opinions issued on the
financial statements of subsidiaries or entities over which the Registrant
exercises management discretion including audit opinions issued on Pension Plans
established for the benefit of the Registrant’s employees.
Audit-Related
Fees
The
aggregate fees billed by the Independent Auditors for assurance and related
services that are reasonably related to the performance of the audit or review
of the Registrant’s financial statements and are not reported as "Audit Fees,"
including consultations concerning financial accounting and reporting matters
not classified as audit, were $2,301,000 for the fiscal year ended October
31, 2009 and $872,000 for the fiscal year ended October 31,
2008. Such engagements include reviews of the interim financial
statements, the reports of which are provided to the Audit Committee, accounting
assistance, advice and translation services related solely to our filed
financial reports and audit-related services in connection with acquisitions,
including audits of transaction-date balance sheets and similar
services.
Tax
Fees
The
aggregate fees billed by the Independent Auditors for professional services
rendered for tax compliance, tax advice and tax planning were $285,000 for the
fiscal year ended October 31, 2009 and $271,000 for the fiscal year ended
October 31, 2008. The services comprising the fees reported as "Tax Fees"
included tax return preparation in various foreign jurisdictions, consultation
regarding various tax issues and support provided to management in connection
with income and other tax audits.
All
Other Fees
During
the fiscal years ended October 31, 2009 and 2008, the Independent Auditors were
not engaged to provide services other than those reported in the preceding three
paragraphs.
Audit Committee Pre-Approval Policies and
Procedures
All audit
and non-audit services performed by the Independent Auditors must be
pre-approved by the Audit Committee of the Registrant.
I. Off-Balance
Sheet Arrangements
See
Management’s Discussion and Analysis of Financial Condition and Results of
Operations for the fiscal year ended October 31, 2009, filed as Exhibit No. 1.3
to this Annual Report on Form 40-F, under the heading “Off-balance sheet
arrangements”.
J. Tabular
Disclosure of Contractual Obligations
Tabular
disclosure of the Registrant’s contractual obligations can be found in its
Management’s Discussion and Analysis of Financial Condition and Results of
Operations for the fiscal year ended October 31, 2009, filed as Exhibit 1.3 to
this Annual Report on Form 40-F, under the heading “Contractual
obligations”.
K.
Critical Accounting Policies
See
Management's Discussion and Analysis of Financial Condition and Results of
Operations for the fiscal year ended October 31, 2009, filed as Exhibit 1.3 to
this Annual Report on Form 40-F, under the heading “Critical accounting policies
and estimates”.
L. Identification
of Audit Committee
The Board
has appointed an Audit Committee consisting of four independent directors:
William D. Anderson (Chair), William G. Dempsey, Robert W. Luba, and Richard H.
McCoy.
M. NYSE
Exemptions
As
required by the NYSE, the Registrant will post on its corporate website at
mdsinc.com
any
significant differences between the corporate governance practices followed by
the Registrant in Canada and those applicable to U.S. companies under the NYSE's
listing standards.
UNDERTAKING AND CONSENT TO
SERVICE OF PROCESS
A. Undertaking
The
Registrant undertakes to make available, in person or by telephone,
representatives to respond to inquiries made by the Commission staff, and to
furnish promptly, when requested to do so by the Commission staff, information
relating to the securities in relation to which the obligation to file an annual
report on Form 40-F arises, or transactions in said securities.
B. Consent
to Service of Process
The
Registrant has previously filed with the Commission a Form F-X in connection
with its Common Shares.
EXHIBITS
The
following exhibits are filed as part of this report:
Exhibit No.
|
Description
|
|
|
1.1
|
Annual
Information Form for the year ended October 31, 2009.
|
|
|
1.2
|
Audited
Consolidated Financial Statements for the fiscal year ended October 31,
2009, prepared in accordance with United States generally accepted
accounting principles.
|
|
|
1.3
|
Management's
Discussion and Analysis of Financial Condition and Results of Operations
for the fiscal year ended October 31, 2009.
|
|
|
23.1
|
Consent
of Ernst & Young LLP.
|
|
|
31.1
|
Certifications
of Chief Executive Officer (Principal Executive Officer) and Executive
Vice-President Finance and Chief Financial Officer (Principal Financial
Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
|
32.1
|
Certification
of Chief Executive Officer (Principal Executive Officer) and Executive
Vice-President Finance and Chief Financial Officer (Principal Financial
Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
SIGNATURES
Pursuant to the requirements of the
Exchange Act, the Registrant certifies that it meets all of the requirements for
filing on Form 40-F and has duly caused this annual report to be signed on its
behalf by the undersigned, thereto duly authorized.
Date:
January 25, 2010
|
MDS Inc
.
By:
/s/ D
ouglas S.
Prince
Name: Douglas
S. Prince
Title: Executive
Vice-President Finance
and
Chief Financial Officer
|
|
|
EXHIBIT
INDEX
Exhibit No.
|
Description
|
|
|
1.1
|
Annual
Information Form for the year ended October 31, 2009.
|
|
|
1.2
|
Audited
Consolidated Financial Statements for the fiscal year ended October 31,
2009, prepared in accordance with United States generally accepted
accounting principles.
|
|
|
1.3
|
Management's
Discussion and Analysis of Financial Condition and Results of Operations
for the fiscal year ended October 31, 2009.
|
|
|
23.1
|
Consent
of Ernst & Young LLP.
|
|
|
31.1
|
Certifications
of Chief Executive Officer (Principal Executive Officer) and Executive
Vice-President Finance and Chief Financial Officer (Principal Financial
Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
|
32.1
|
Certification
of Chief Executive Officer (Principal Executive Officer) and Executive
Vice-President Finance and Chief Financial Officer (Principal Financial
Officer) pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
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