<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD
ENDED SEPTEMBER 30, 1996.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 for the transition period
from _______________ to _______________.
COMMISSION FILE NUMBER: 0-26748
CARDIOMETRICS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 77-0095687
(State of Incorporation) (I.R.S. Employer Identification No.)
645 CLYDE AVENUE, MOUNTAIN VIEW, CALIFORNIA 94043
(Address of principal executive offices)
Registrant's telephone number, including area code: (415) 961-6993
Indicate by check whether the Registrant (1) has filed all reports to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 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
----- -----
As of October 31, 1996, there were 6,912,375 shares of the issuer's Common
Stock, $0.01 par value, outstanding.
<PAGE> 2
CARDIOMETRICS, INC.
INDEX
<TABLE>
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements and Notes
Balance Sheets as of September 30, 1996 and December 31, 1995 . . . . . . . . . . . .. . . . . . . . . 3
Statements of Operations for the three months and the nine months ended
September 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Statements of Cash Flows for the nine months
ended September 30, 1996 and 1995. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. . . . . 8
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SIGNATURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements and Notes
CARDIOMETRICS, INC.
BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
September 30, 1996 December 31, 1995
------------------ -----------------
(Unaudited) (Note 1)
<S> <C> <C>
ASSETS
Current assets:
Cash, cash equivalents and short term investments $ 18,451 $ 20,725
Accounts receivable, net of allowance for doubtful
accounts 1,776 1,771
Accounts receivable, related party 1,247 1,342
Inventories 2,471 1,758
Other current assets 472 225
-------- --------
Total current assets 24,417 25,821
Property and equipment, net 910 878
Other assets 1 31
-------- --------
Total assets $ 25,328 $ 26,730
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 923 $ 921
Accrued employee compensation 565 470
Accrued clinical trial expenses 371 282
Deferred revenue and other current liabilities 135 140
-------- --------
Total current liabilities 1,994 1,813
Notes payable, less current portion 61 223
Stockholders' equity:
Common stock, $0.01 par value;
15,000 shares authorized, 6,892 and 6,689 shares
issued and outstanding as of September 30, 1996 and
December 31, 1995, respectively 69 67
Additional paid-in capital 57,282 57,241
Deferred compensation (602) (761)
Accumulated deficit (33,476) (31,853)
-------- --------
Total stockholders' equity 23,273 24,694
-------- --------
Total liabilities and stockholders' equity $25,328 $26,730
======== ========
</TABLE>
See accompanying notes.
3
<PAGE> 4
CARDIOMETRICS, INC.
STATEMENTS OF OPERATIONS
(In thousands, except per share amounts; unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------------- ----------------------------------
1996 1995 1996 1995
--------------- -------------- ----------------- -------------
<S> <C> <C> <C> <C>
Net sales $ 3,325 $ 2,774 $ 10,028 $ 7,599
Costs and expenses:
Cost of sales 1,189 1,182 3,855 3,227
Research and development 1,017 496 2,437 1,658
Selling, general and administration 2,220 1,823 6,109 4,669
-------- -------- -------- --------
Total costs and expenses 4,426 3,501 12,401 9,554
Loss from operations (1,101) (727) (2,373) (1,955)
Interest and other income 258 55 791 132
Interest expense (12) (24) (41) (88)
-------- -------- -------- --------
Net loss $ (855) $ (696) $ (1,623) $ (1,911)
======== ======== ======== ========
Net loss per share $ (0.12) $ (0.15)(1) $ (0.24) $ (0.43)(1)
======== ======== ======== ========
Shares used in computing net loss per share 6,879 4,601(1) 6,772 4,485(1)
======== ======== ======== ========
</TABLE>
(1) See Note 2 for methodology used to compute pro forma net loss per share, as
shown above.
See accompanying notes.
4
<PAGE> 5
CARDIOMETRICS, INC.
STATEMENTS OF CASH FLOW
(In thousands; unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------------
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (1,623) $ (1,911)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 305 355
Amortization of deferred compensation 159 --
Changes in assets and liabilities:
Accounts receivable (5) (125)
Accounts receivable, related parties 95 (112)
Inventories (713) 54
Other assets (217) (112)
Accounts payable (22) 223
Accrued employee compensation 95 34
Accrued clinical trial expenses 89 (369)
Deferred revenue and other current liabilities (5) (36)
-------- --------
Net cash used in operating activities (1,842) (1,999)
Cash flows from investing activities:
Purchases of available-for-sale securities (25,443) (5,884)
Proceeds from sales of available-for-sale securities 16,870 4,927
Purchase of equipment and leasehold improvements (337) (243)
-------- --------
Net cash used in investing activities (8,910) (1,200)
Cash flows from financing activities:
Proceeds from sale of common stock, net of stock repurchases 43 37
Proceeds from sale of preferred stock -- 2,505
Principal payments on notes payable (138) (282)
Principal payments on capital leases -- (3)
-------- --------
Net cash (used in), provided by financing activities (95) 2,257
-------- --------
Net decrease in cash and cash equivalents (10,847) (942)
Cash and cash equivalents at beginning of period 11,898 1,322
-------- --------
Cash and cash equivalents at end of period $ 1,051 $ 380
======== ========
Supplemental disclosure of cash flow information
Cash paid for interest $ 41 $ 88
======== ========
</TABLE>
See accompanying notes.
5
<PAGE> 6
CARDIOMETRICS, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
(UNAUDITED)
1. Basis of Presentation
The accompanying unaudited financial statements for the three
month and nine month periods ended September 30, 1996 and 1995 include
all adjustments (consisting of normal recurring adjustments) which the
Company considers necessary for a fair presentation of the operating
results and cash flows for those periods.
Certain information and footnote disclosures required by generally
accepted accounting principles for complete financial statements have
been omitted pursuant to the rules and regulations of the Securities
and Exchange Commission ("SEC"), although the Company believes that the
disclosures included are adequate to make the information presented not
misleading. These financial statements should be read in conjunction
with the audited financial statements and footnotes included in the
Company's Annual Report on Form 10-K for the year ended December 31,
1995.
Results for the interim periods ended September 30, 1996 are not
necessarily indicative of the results expected for future interim
periods or for the entire year ending December 31, 1996.
2. Net Loss Per Share
Except as noted below, historical net loss per share for the three
month and nine month periods ended September 30, 1996 and 1995 is
computed using the weighted average number of shares of common stock
outstanding. Common equivalent shares from stock options and warrants
are excluded from the computation as their effect is antidilutive,
except that, pursuant to the Securities and Exchange Commission Staff
Accounting Bulletins, common and common equivalent shares issued at
prices substantially below the public offering price during the
12-month period prior to the initial public offering have been included
in the calculation as if they were outstanding for all periods through
the effective date of the Company's initial public offering, November
3, 1995 (using the treasury stock method). The historical net loss per
share for the three month and nine month periods ended September 30,
1995 is calculated below.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, 1995 September 30, 1995
----------------------- -----------------------
<S> <C> <C>
Net loss per share $ (2.16) $ (6.20)
======================= =======================
Shares used in computing 322,000 308,000
net loss per share ======================= =======================
</TABLE>
Pro forma net loss per share, as presented in the statement of
operations for the three month and nine month periods ended September
30, 1995, has been computed as described above and also gives effect to
the conversion of convertible preferred shares, not included above,
from the original date of issuance (using the as-if-converted method).
6
<PAGE> 7
3. Balance Sheet Information
<TABLE>
<CAPTION>
(In thousands) September 30, 1996 December 31, 1995
------------------ -----------------
<S> <C> <C>
Cash, cash equivalents and short term investments:
Cash and cash equivalents $ 1,051 $ 11,898
Short term investments 17,400 8,827
-------- --------
$ 18,451 $ 20,725
======== ========
Accounts receivable:
Accounts receivable $ 1,891 $ 1,877
Allowance for doubtful accounts (115) (106)
-------- --------
$ 1,776 $ 1,771
======== ========
Inventories:
Raw materials $ 815 $ 417
Work-in-process 507 400
Finished goods 1,149 941
-------- --------
$ 2,471 $ 1,758
======== ========
</TABLE>
7
<PAGE> 8
CARDIOMETRICS, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The discussion in this Form 10-Q contains forward looking statements that
involve risks and uncertainties. The Company's actual results could differ
materially from those discussed herein. Factors that could cause or contribute
to such differences include, but are not limited to, clinical and payor
acceptance of the Company's products, the impact of competitive products and
other risks detailed from time to time in the Company's SEC reports, including
the Company's Annual Report on Form 10-K for the year ended December 31, 1995
and the Company's Registration Statement on Form S-1 as declared effective by
the Securities and Exchange Commission on November 1, 1995 (Reg. No. 33-96690).
GENERAL
Cardiometrics, Inc. (Cardiometrics or the Company) develops, manufactures
and markets intravascular medical devices that measure the severity of blood
flow impairment caused by coronary artery blockages and other blood vessel
disease. The Company is pioneering the development of a new market in
interventional cardiology, on-line functional testing during diagnostic and
therapeutic cardiac catheterization procedures. The Company's primary product,
the FloWire(R) Doppler guide wire, is a unique and proprietary tool that is used
instead of conventional guide wires in conjunction with coronary angiography and
angioplasty to measure blood flow impairment. Understanding the functional
significance of blockages by using the FloWire, in addition to the anatomical
view of the diseased blood vessel, provides a more accurate diagnosis, and
treatment is more appropriately selected, enhancing the likelihood of better
clinical outcomes. The FloWire, a single use disposable device, works with the
FloMap(R) ultrasound instrument, which interprets and displays the signals from
the FloWire. The FloMap has been installed in over 400 cardiac catherization
laboratories throughout the world and more than 58,000 FloWire devices have been
sold to date.
The Company has not been profitable since inception and, as of September
30, 1996, had an accumulated deficit of $33.5 million, $23.5 million of which
has been incurred since the Company restructured its operations under new
management in 1990 to focus on the development and commercialization of the
FloWire/FloMap system. Further growth in sales of the Company's products and the
resulting gross profit will be needed to offset future investments in research
and development, clinical outcome studies and selling, general and
administrative expenses.
RESULTS OF OPERATIONS
The following table summarizes results of operations of the Company as a
percentage of sales for the periods indicated.
<TABLE>
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
-------------------------- -------------------------
1996 1995 1996 1995
------------ ---------- --------- -----------
<S> <C> <C> <C> <C>
Percentage of sales:
Sales 100% 100% 100% 100%
Cost of sales 36 43 38 42
------------ ---------- --------- -----------
Gross margin 64 57 62 58
Operating expenses:
Research and development 31 18 24 22
Selling, general and administrative 67 66 61 61
------------ ---------- --------- -----------
Total operating expenses 98 84 85 83
Interest income, net 8 1 7 --
------------ ---------- --------- -----------
Net loss (26)% (26)% (16)% (25)%
============ ========== ========= ===========
</TABLE>
8
<PAGE> 9
Sales. Sales increased 20% during the three months ended September 30,
1996 over the three months ended September 30, 1995 to $3,325,000 from
$2,774,000. Sales increased 32% during the nine months ended September 30, 1996
compared to the same nine month period of 1995 to $10,028,000 from $7,599,000.
Sales for both the three month and nine month periods ended September 30, 1996
increased over the corresponding periods of 1995 primarily as a result of an
increase in sales of FloWire units, mainly concentrated in the Japanese market,
and to a lesser extent, an increase in FloMap instrument unit sales. These
increases were partially offset by a decrease in sales of AccuTrac units during
the three month period ended September 30, 1996 as compared to the similar
period in 1995.
Cost of sales. Cost of sales increased less than one percent during the
three months ended September 30, 1996 compared to the three months ended
September 30, 1995 to $1,189,000 from $1,182,000. Cost of sales increased 19%
for the nine months ended September 30, 1996 compared to the same nine month
period of 1995 to $3,855,000 from $3,227,000. As a percentage of sales, cost of
sales decreased to 36% for the three months ended September 30, 1996 compared to
43% in the same three month period of 1995 and to 38% for the nine month period
ended September 30, 1996 compared to 42% for the nine month period ended
September 30, 1995. These decreases were primarily the result of lower per unit
FloWire manufacturing costs. These cost reductions were achieved primarily
through lower manufacturing overhead cost per unit due to increased volumes and
manufacturing efficiencies.
Research and development. Research and development expenses increased
105% during the three months ended September 30, 1996 over the three month
period ended September 30, 1995 to $1,017,000 from $496,000. Research and
development expenses increased 47% during the nine month period ended September
30, 1996 over the similar period of 1995 to $2,437,000 from $1,658,000. As a
percentage of sales, research and development expenses increased to 31% in the
third quarter of 1996 from 18% in the same quarter of 1995. For the nine months
ended September 30, 1996, research and development expenses as a percentage of
sales increased to 24% as compared to 22% during the similar nine month period
of 1995. These increases for both the three month and nine month periods ended
September 30, 1996 over the similar periods of 1995 were primarily due to
increased costs incurred in connection with clinical studies commenced in 1996,
which the Company includes in research and development expenses. The
expenditures on clinical studies included both on-going studies and studies
initiated during the first nine months of 1996.
Selling, general and administrative. Selling, general and
administrative expenses increased 22% during the three months ended September
30, 1996 over the three months ended September 30 ,1995 to $2,220,000 from
$1,823,000. Selling, general and administrative expenses increased 31% during
the nine month period ended September 30, 1996 over the similar period of 1995
to $6,109,000 from $4,669,000. Selling, general and administrative expenses as a
percentage of sales increased slightly during the third quarter of 1996 to 67%
compared to 66% during the third quarter of 1995. Selling, general and
administrative expenses as a percentage of sales remained at 61% during the nine
month period ended September 30, 1996 when compared with the similar period of
1995. The dollar increases in selling, general and administrative expenses
reflect increased staffing and associated expenses, additional sales and
marketing programs, external corporate reporting expenses and expenses
associated with increased sales volumes.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1996, the Company had working capital of $22,423,000
and its principal sources of liquidity consisted of $18,451,000 in cash, cash
equivalents and short term investments.
For the nine months ended September 30, 1996, the Company's cash used
in operations was $1,842,000. Inventories increased to $2,471,000 at September
30, 1996 compared to $1,758,000 at December 31, 1995 primarily due to an
increase in raw materials. Accounts receivable, including accounts receivable
from related parties, decreased to $3,023,000 at September 30, 1996 from
$3,113,000 at December 31, 1995. The Company expects to incur substantial
additional costs, including costs related to sales and marketing, research and
development, including additional clinical outcome studies, the purchase of
capital equipment and costs associated with the expansion of the Company's
manufacturing capacity. The Company believes it has sufficient funds for the
Company's anticipated funding requirements through at least 1997. However, there
can be no assurance that the Company will not require additional financing, or
that if required, such financing will be available on terms acceptable to the
Company.
9
<PAGE> 10
CARDIOMETRICS, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K
Exhibit Description
Number
------ -----------------------------------------------------
10.26 Amendment dated August 7, 1996 to the Employment
Agreement between Registrant and Menahem Nassi,
Ph.D., dated December 13, 1990, as amended.
10.27* Addendum dated September 26, 1996 to the Exclusive
Distribution Agreement by and between Registrant and
Cordis /Johnson & Johnson Medical NV/SA, formerly
Cordis Europa N.V., executed September 10, 1995 and
effective as of April 1, 1995.
11.1 Statement of computation of net loss per share
27.2 Financial Data Schedule
(b) Reports on Form 8-K
None.
* Confidential treatment requested as to certain portions of this exhibit
10
<PAGE> 11
CARDIOMETRICS, INC.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CARDIOMETRICS, INC.
Date: November 12, 1996
/s/Robert Y. Newell, IV
-----------------------------------------
Robert Y. Newell, IV
Vice President, Finance & Administration,
Chief Financial Officer and Secretary
(Principal Financial Officer and Duly
Authorized Officer)
11
<PAGE> 12
CARDIOMETRICS, INC.
EXHIBIT INDEX
Sequentially
Exhibit Numbered
Number Description Page
- --------------------------------------------------------------------------------
10.26 Amendment dated August 7, 1996 to the Employment Agreement
between Registrant and Menahem Nassi, Ph.D., dated December
13, 1990, as amended.
10.27* Addendum dated September 26, 1996 to the Exclusive
Distribution Agreement by and between Registrant and Cordis
/Johnson & Johnson Medical NV/SA, formerly Cordis Europa N.V.,
executed September 10, 1995 and effective as of April 1, 1995.
11.1 Statement of computation of net loss per share
27.1 Financial Data Schedule
* Confidential treatment requested as to certain portions of this exhibit
12
<PAGE> 1
EXHIBIT 10.26
August 7, 1996
PERSONAL & CONFIDENTIAL
Dr. Menahem Nassi
c/o Cardiometrics, Inc.
645 Clyde Avenue
Mountain View, CA 94043
Re: Amendment to Your Employment Agreement
Dear Meno:
This letter is intended to amend certain terms of your employment
agreement with Cardiometrics, Inc., formerly a California corporation, but
currently a Delaware corporation (the "Company"), which is set forth in that
certain letter, dated as of December 13, 1990, from David Titus to you (the
"Employment Agreement"), as amended by those certain amendment letters, dated
June 26, 1991, November 26, 1991, September 4, 1992, November 1, 1992 and
October 11, 1993 from David Douglass to you, and my amendment letters to you
dated August 31, 1995 and September 1, 1995 (collectively, the "Amendments to
the Employment Agreement"):
Paragraph 2 of the Employment Agreement is hereby deleted and
amended in its entirety to read as follows:
"2. Commencing February 1, 1996, your salary as
President and Chief Executive Officer of the Company will be
at a pre-tax rate equal to $13,958.33 per month until
otherwise adjusted by the Compensation Committee of the Board
of Directors of the Company."
Paragraph 5 of the Employment Agreement is hereby deleted and
amended in its entirety to read as follows:
"5. As with all other Company employees, employment
with the Company is not for a specific term and can be
terminated by either you or the Company at any time for any
reason, with or without cause. However, in the event the
Company terminates your employment without cause (as defined
below), you shall be entitled to: (a) salary continuation from
the Company for up to twelve (12) months following the date of
such termination at the monthly salary rate established as of
(i) the date hereof, or (ii) the date upon which your
employment is so terminated, whichever is greater; provided,
however, that such salary continuation payments shall cease
upon your becoming employed on a full-time basis with another
employer; and, provided, further, however, that such salary
continuation payments shall be made for a period of at least
six (6) months from the date of such termination even if you
become employed by another employer within six (6) months of
such termination; and (b) continue to participate in the
Company's benefit plans for up to twelve (12) months following
the date of such termination; provided, however, that such
continued participation in the Company's benefit plans shall
cease upon your becoming employed on a full-time basis with
another employer. During any period of salary or benefits
continuation and as partial consideration for such
continuation, you agree to provide the Company with up to four
(4) days of consulting services per month as reasonably
assigned to you by the Company. The Company will reimburse you
for your reasonable your out-
<PAGE> 2
of-pocket expenses in connection with such requested
consulting services. Your sole compensation for providing such
consulting services shall be the salary and benefits
continuation described in this paragraph and, therefore, your
failure to provide such services shall result in termination
of such salary and benefits continuation notwithstanding any
other terms hereof.
For purposes of this employment agreement,
termination "without cause" shall mean termination for reasons
other than:
(i) your repeated refusal to comply with reasonable
directives of the Board of Directors of the Company, or your
gross negligence or willful misconduct in the performance of
duties assigned to you by the Board of Directors, or your
intentional conduct materially harmful to the Company's
business and affairs, provided that poor achievement of job
objective in itself shall not constitute cause for
termination;
(ii) your violation of any provision of the
Company's proprietary information agreement to the extent that
has caused material harm to the interests of the Company; or
(iii) your conviction of any crime involving moral
turpitude, fraud, or any felony."
Except as otherwise specifically provided herein, all of the
provisions of the Employment Agreement, as amended by the Amendments to the
Employment Agreement, shall remain in full force and effect, and the Employment
Agreement, as amended thereby and hereby, is hereby ratified and confirmed in
all respects. This letter, together with the Amendments to the Employment
Agreement and the Employment Agreement, shall be read together as one document,
and such agreements, together with your executed Proprietary Information and
Inventions Agreement shall constitute the full and entire understanding and
agreement between you and the Company with respect to your employment with the
Company.
If this amendment letter accurately reflects the terms of your
employment with the Company, please sign and return to me the enclosed copy of
this amendment letter.
Sincerely,
CARDIOMETRICS, INC.
/s/ H. Raymond Wallace
-----------------------------------------
H. Raymond Wallace
On Behalf of the Compensation Committee
of the Board of Directors
ACCEPTED AND AGREED
/s/ Menahem Nassi
- -----------------------------
Dr. Menahem Nassi
Dated: August 7, 1996
<PAGE> 1
EXHIBIT 10.27**
September 26, 1996
To: Donal P. O'Dwyer
President, Europe
Johnson & Johnson Medical NV/SA
Waterloo Office Park
Drive Richelle 161 H
1410 Waterloo, Belgium
Re: Extension of contract
This document represents an addendum to the Cordis-Cardiometrics Distribution
Agreement, signed April 1, 1995, and extended on April 22, 1996. This
distribution agreement which is now in effect between Cardiometrics, Inc., a
Delaware Corporation and Cordis/Johnson & Johnson Medical NV/SA will be extended
through December 31, 1997 and it will include the possibility of adding **,
effective January 1, 1997 (see below for possible start dates).
This extension requires the delivery of minimum quarterly non-cancelable P.O.'s
by Cordis/Johnson & Johnson to Cardiometrics to maintain exclusive distribution
rights for the "Products" in the "Territories" as agreed to in the distribution
agreement amended by this document. For future years 1998 and beyond, minimum
purchase commitments to maintain exclusive distribution will be negotiated by
September 30th of the preceding year. Following is the agreed to minimum
purchase commitment for 1997 (quarterly minimum non-cancelable P.O. requirements
in units):
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Products Jan Feb Mar April May June July Aug Sept Oct Nov Dec Total
FloWire ** ** ** ** ** ** ** ** ** ** ** ** **
*FloMap ** ** ** ** ** ** ** ** ** ** ** ** **
</TABLE>
Following are requirements for the SmartWire and SmartMap sales to end-users to
deplete Roden stock. These do not include commitments for new purchases from
Cardiometrics. This inventory should therefore serve the purpose of market
development, with future additional purchases if necessary:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Products Jan Feb Mar April May June July Aug Sept Oct Nov Dec Total
SmartWire ** ** ** ** ** ** ** ** ** ** ** ** **
SmartMap ** ** ** ** ** ** ** ** ** ** ** ** **
</TABLE>
*commitments can be changed to FloMap II as needed for equal dollar value.
<PAGE> 2
Territories include the following areas:
** Spain
France Scandinavia
** Africa
** Middle East (excluding Turkey,
United Kingdom Israel and Greece)
Transfer prices for FloWire at ** each for all models and sizes and FloMap at
** each. FloMap II price is ** each.
The January 1, 1997 start date for the additional countries ** is dependent on
receiving P.O.'s by September 30, 1996 and by December 31, 1996 as follows:
<TABLE>
<CAPTION>
By September 30, 1996 By December 31, 1996
--------------------- --------------------
<S> <C> <C>
** FloWire ** **
FloMap ** **
SmartWire ** **
SmartMap ** **
** FloWire ** **
FloMap ** **
** FloWire ** **
FloMap ** **
Totals FloWire ** **
FloMap ** **
SmartWire ** **
SmartMap ** **
</TABLE>
This amendment is agreed to and accepted by:
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Michael J. Sorna /s/ Donal P. O'Dwyer
- -------------------------------- ------------------------------- --------------------------------
Menahem Nassi, Ph.D. Michael J. Sorna Donal P. O'Dwyer
President and CEO Vice President President, Europe
Cardiometrics, Inc. International Sales and Cordis/
Operations Johnson & Johnson
Cardiometrics, Inc. Medical NV/SA
Date: Date: 9/27/96 Date: 9/27/96
--------------------- --------------------- --------------------
</TABLE>
** Confidential treatment requested; omitted portion has been filed separately
with the Commission
<PAGE> 1
EXHIBIT 11.1
CARDIOMETRICS, INC.
Statement of Computation of Net Loss Per Share
(In thousands, except net loss per share data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
-------------- ------------- ------------- --------------
<S> <C> <C> <C> <C>
Net loss $ (855) $ (696) $(1,623) $(1,911)
Shares used in computation of net loss per share:
Weighted average of shares of common stock outstanding 6,879 138 6,772 124
Shares related to Staff Accounting Bulletin Nos. 55, 64 and 83 -- 184 -- 184
------- ------- ------- -------
Shares used in net loss per share computation 6,879 322 6,772 308
======= ======= ======= =======
Net loss per share $ (0.12) $ (2.16) $ (0.24) $ (6.20)
======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C>
Calculation of shares outstanding for
computing pro forma net loss per share:
Adjusted to reflect the effect of assumed conversion of
convertible preferred stock from the date of issuance 4,279 4,177
------------- --------------
Shares used in computing pro forma net loss per share 4,601 4,485
------------- --------------
Pro forma net loss per share $ (0.15) $ (0.43)
============= ==============
</TABLE>
Notes:
(1) The 1996 computation includes the conversion of preferred stock which
occurred upon consummation of the Company's initial public offering on November
3, 1995.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 001000369
<NAME> CARDIOMETRICS INC.
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<CASH> 18,451
<SECURITIES> 0
<RECEIVABLES> 3,023
<ALLOWANCES> 115
<INVENTORY> 2,471
<CURRENT-ASSETS> 24,417
<PP&E> 3,599
<DEPRECIATION> 2,689
<TOTAL-ASSETS> 25,328
<CURRENT-LIABILITIES> 1,994
<BONDS> 0
0
0
<COMMON> 57,351
<OTHER-SE> (34,078)
<TOTAL-LIABILITY-AND-EQUITY> 25,328
<SALES> 10,028
<TOTAL-REVENUES> 10,028
<CGS> 3,855
<TOTAL-COSTS> 12,401
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 41
<INCOME-PRETAX> (1,623)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,623)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,623)
<EPS-PRIMARY> (0.24)
<EPS-DILUTED> (0.24)
</TABLE>
