<PAGE>
<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended February 28, 1999
OR
( ) TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT
Commission File Number : 0-27380
ECHOCATH, INC.
--------------------------------------------------------------------
(Exact Name of Small Business Issuer as specified in its charter)
New Jersey 22-3273101
- ----------------------------- ------------------------------------
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization)
P.O. Box 7224, Princeton, NJ 08543
- -------------------------------------------------------------------------------
(Address of Principal Executive Offices)
Issuer's Telephone Number. . .(609) 987-8400
- -------------------------------------------------------------------------------
Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report
Check whether Issuer (1) has filed all reports required to be filed by Section
13 or 15 (d) of the Exchange Act during the past 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
-------- -------
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
<TABLE>
<CAPTION>
CLASS OF COMMON EQUITY OUTSTANDING AT APRIL 14, 1999
<S> <C>
Class A common stock (No Par Value) 2,352,018
Class B common stock (No Par Value) 1,172,018
</TABLE>
Transitional Small Business Disclosure Format (check one)
YES NO X
-------- -------
1
<PAGE>
<PAGE>
PART 1: FINANCIAL INFORMATION
PART 2: OTHER INFORMATION
ECHOCATH, INC.
INDEX
<TABLE>
<CAPTION>
Item 1: Financial Statements Page
<S> <C>
Balance Sheets,
August 31, 1998 and February 28, 1999 (Unaudited) 3
Statements of Operations for the three months ended
February 28, 1998 (Unaudited), and February 28, 1999 (Unaudited) 4
Statements of Operations for the six months ended
February 28, 1998 (Unaudited), and February 28, 1999 (Unaudited) 5
Statements of Cash Flows for the six months ended
February 28, 1998 (Unaudited), and February 28, 1999 (Unaudited) 6
Notes to Financial Statements 7 - 9
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operation 10 - 12
Signatures 13
</TABLE>
2
<PAGE>
<PAGE>
ITEM 1: FINANCIAL STATEMENTS
ECHOCATH, INC.
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
August 31, 1998 February 28, 1999
(Unaudited)
Current assets:
<S> <C> <C>
Cash and cash equivalents $ 256,234 $ 94,291
Accounts receivable 4,905 65,000
Inventory 189,121 174,873
Prepaid expenses 106,449 70,028
------- ------
Total current assets 556,709 404,192
Furniture, equipment and leasehold improvements, net 254,180 228,000
Intangible assets, net 282,145 280,387
Other assets 19,731 19,322
------ ------
$1,112,765 $ 931,901
========== =========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable $ 540,000 $ 1,065,000
Accounts payable 71,061 151,754
Deferred Income -- 165,000
Accrued expenses 550,299 735,800
Obligations under capital leases, less current portion 16,069 17,863
--------- ---------
Total current liabilities 1,177,429 2,135,417
Obligations under capital leases 22,398 32,375
Other liabilities 149,244 176,758
--------- ---------
Total liabilities 1,349,071 2,344,550
--------- ---------
Stockholders' deficit:
Preferred stock, no par value, 5,000,000 shares authorized; 280,000 shares of
Series B cumulative convertible issued and outstanding, senior in
liquidation to Class A and Class B common
stock, (liquidation value $1,400,000) 1,393,889 1,393,889
Class A common stock, no par value, 18,500,000 shares authorized;
2,352,430 issued and outstanding as of February 28, 1999 and 2,332,078
as of August 31, 1998 7,248,219 7,248,834
Class B common stock, no par value, 1,500,000 shares authorized;
1,172,018 shares issued and outstanding, 327,982 shares retired and
transferred to Class A shares; convertible into one share of Class A
common stock 4,023,470 4,023,470
Accumulated deficit (12,901,884) (14,078,842)
----------- -----------
Total stockholders' deficit (236,306) (1,412,649)
----------- -----------
----------- -----------
$ 1,112,765 $ 931,901
============ ===========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE>
<PAGE>
ECHOCATH, INC.
STATEMENT OF OPERATIONS
THREE MONTHS ENDED FEBRUARY 28, 1998 AND
FEBRUARY 28, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1999
REVENUE:
<S> <C> <C>
License fees $ -- $ 165,000
Product sales -- 8,040
---------- ----------
Total revenue -- 173,040
Cost of sales -- 7,574
---------- ----------
Gross profit -- 165,466
Operating expenses:
Research & Development 355,107 329,086
Marketing and G&A 422,566 272,697
---------- ----------
Total operating expenses 777,673 601,783
---------- ----------
Loss from operations (777,673) (436,317)
Net interest income (expense) 3,865 (21,066)
---------- ----------
Net loss (773,808) (457,383)
---------- ----------
Preferred dividends 18,900 18,900
---------- ----------
Net loss to common stockholders $ (792,708) $(476,283)
=========== ==========
Basic and diluted net (loss) per share $ (0.30) $ (0.18)
Weighted average shares outstanding 2,691,000 2,691,000
</TABLE>
See accompanying notes to financial statements.
4
<PAGE>
<PAGE>
ECHOCATH, INC.
STATEMENT OF OPERATIONS
SIX MONTHS ENDED FEBRUARY 28, 1998 AND
FEBRUARY 28, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1999
REVENUE:
<S> <C> <C>
License fees $ 800,000 $ 165,000
Product sales -- 23,759
---------- ----------
Total revenue 800,000 188,759
Cost of sales -- 15,299
---------- ----------
Gross profit 800,000 173,460
Operating expenses:
Research & Development 696,499 718,820
Marketing and G&A 879,431 556,252
---------- ----------
Total operating expenses 1,575,930 1,275,072
---------- ----------
Loss from operations (775,930) (1,101,612)
Net interest income (expense) 3,220 (37,546)
---------- ----------
Net loss (772,710) (1,139,158)
---------- ----------
Preferred dividends 37,800 37,800
---------- ----------
Net loss to common stockholders $(810,510) $(1,176,958)
========== ============
Basic and diluted earnings per share $ (0.32) $ (0.44)
Weighted average shares of Common Stock 2,559,000 2,691,000
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
<PAGE>
ECHOCATH, INC.
STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED FEBRUARY 28, 1998 AND 1999
(UNAUDITED)
<TABLE>
<CAPTION>
1998 1999
<S> <C> <C>
Cash flows from operating activities:
Net loss $ (772,710) $ (1,139,158)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization 59,346 56,219
Change in operating assets & liabilities:
Increase in trade accounts receivable -- (60,095)
(Increase) decrease in inventory (584) 14,248
Decrease in prepaid expenses and other current assets 30,322 34,547
Decrease in deferred financing costs -- 1,875
Increase (decrease) in other assets (425) 409
Increase in accounts payable 1,792 86,587
Increase in accrued expenses 26,966 382,408
Increase (decrease) in other liabilities 30,862 (3,469)
--------- ---------
Net cash used in operating activities (624,431) (626,429)
--------- ---------
Cash flows from investing activities:
Purchase of furniture, equipment and leasehold improvements (27,725) (19,393)
Purchase of intangible assets (29,841) (8,890)
-------- --------
Net cash used in investing activities (57,566) (28,283)
-------- --------
Cash flows from financing activities:
Principal payments on capital lease obligations (4,080) 4,954
Proceeds from employee stock purchase plan 223 615
Issuance of Class A common stock 1,049,000 --
Class B preferred dividends (37,800) (37,800)
Proceeds from IPA note -- 525,000
---------- ----------
Net cash provided by financing activities 1,007,343 492,769
---------- ----------
325,346 (161,943)
Cash and cash equivalents, beginning of year 788,933 256,234
----------- -----------
Cash and cash equivalents, end of period $ 1,114,279 $ 94,291
=========== =============
Supplemental disclosure of cash flow information:
Interest expense $ 29,883 $ 41,081
--------- ---------
Supplemental disclosure of noncash information:
Equipment acquired under capital lease $ 8,190 $ 13,337
======== =========
</TABLE>
6
<PAGE>
<PAGE>
ECHOCATH, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
NOTE A: GENERAL AND BUSINESS
The summary financial statements included herein have been prepared, without
audit, pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, although the Management of EchoCath, Inc. (the "Company") believes
that the disclosures are adequate to make the information presented not
misleading. It is suggested that these summary financial statements be read in
conjunction with the financial statements and the notes thereto included in the
Company's Form 10-KSB for the fiscal year ended August 31, 1998.
In the opinion of management, all adjustments (consisting solely of normal
recurring adjustments) necessary to present fairly the financial position,
results of operation and cash flows at February 28, 1998 and 1999 have been
made.
NOTE B:
Inventories are summarized as follows:
<TABLE>
<CAPTION>
August 31, 1998 February 28, 1999
--------------- -----------------
<S> <C> <C>
Raw Materials $ 96,659 $ 96,769
Work in Process 15,605 11,508
Finished Goods 76,857 66,596
------- ------
$ 189,121 $ 174,873
======= =======
NOTE C:
SALE OF TAX BENEFITS
As of February 1, 1999, The Company sold $220,000 of New Jersey tax benefits to
a related party for $165,000 under the New Jersey Technology Business Tax
Certificate Program. The transaction is subject to final regulations and the
issuance of the Tax Certificate. As a result, the $165,000 is reflected as
deferred income.
NOTE D:
LICENSE AGREEMENTS
On December 30, 1996 the Company announced that it entered into an exclusive
license agreement with Medtronic, Inc. for the licensing of EchoMark'r' and
ColorMark'r' proprietary technologies for certain medical procedures. The total
payments to the Company under the December 1996 Medtronic Agreement have been
$265,000, including a payment of $65,000 pursuant to a termination agreement in
February 1999.
The Company entered into an exclusive license agreement dated February 27, 1997
with EP MedSystems, Inc. (EP MedSystems). The agreement provides that certain
products can be incorporated into the EP MedSystems' diagnostic catheter line.
The Company expects to receive development milestone payments of up to $300,000.
The milestones include the testing of a limited series of patients, system
capability demonstration, and the sale of a limited quantity of product. When
products are commercially available the Company will receive royalties under the
terms of the agreement. The Company has received no milestone payment but it has
earned minimum royalties of $30,000 per quarter starting with the calendar
quarter beginning January 1999 under this agreement. The agreement provides that
any royalty payment can be reduced, but not to an amount below zero, by an
amount equal to the amount of any dividends under the Company's Series B
cumulative preferred stock which are accrued but not paid as of that date. As of
February 28, 1999 the Company has $151,200 of accrued preferred stock dividends,
which is included as a component of accrued liabilities on the accompanying
Balance Sheet.
On October 30, 1997, the Company announced it had reached a second definitive
licensing and development agreement with Medtronic, Inc. Pursuant to the terms
of the October 1997 Medtronic Agreement, the Company
7
<PAGE>
<PAGE>
granted Medtronic (i) a worldwide exclusive license to make, have made, use,
sell and have sold products utilizing the Company's ColorMark and EchoMark
technologies in guiding devices during cardiothoracic surgical procedures: and
(ii) the exclusive right and option at any time within six (6) months of the
effective date of the October 1997 Medtronic Agreement, to acquire a worldwide
exclusive license to the Company's EchoEye and EchoFlow technologies for use in
guiding device during cardiothoracic surgical procedures. This option expired
on December 31, 1998 after the granting of several extensions after the initial
six months.
In consideration of the grant of the exclusive rights to Medtronic, Medtronic
agreed to pay to the Company a combined total of $1,800,000, which amount
included, (i) $800,000 paid to the Company in upfront licensing fees and (ii)
$1,000,000 from the purchase of 363,636 restricted shares of the Company's Class
A common stock, no par value (the "Class A common stock"), issued to Medtronic
Asset Management, Inc., a wholly-owned subsidiary of Medtronic. Additionally,
the Company may receive minimum annual royalties from Medtronic upon product
commercialization. The Company has received $250,000 payment for the completion
of "Concept Design Validation" for the EchoFlow instrument under this agreement.
The Company entered into an option agreement on January 11, 1999 with another
company for the licensing of certain technology. The term of the option is three
months and the consideration received for the option was $100,000. The Company
has extended the option for 30 days to May 14, 1999 at an additional
consideration of $30,000.
The Company entered into an option agreement on April 16, 1999 with
another company for the licensing of certain technology. The term of the
option is three months with three monthly extensions and the consideration
received for the option was $35,000 for the option and $10,000 for each monthly
extension.
NOTE E :
EARNINGS PER SHARE
Basic and dilutive loss per share is based on net loss for the relevant period,
adjusted for cumulative Series B preferred stock dividends of $37,800 and
$18,900 for the six and three month periods ended February 28,1999 and 1998,
respectively, divided by the weighted average number of shares outstanding
during the period. For purposes of the diluted loss per share calculation, the
exercise or conversion of all potential common shares is not included since
their effects would be antidilutive for all periods presented.
NOTE F :
CONVERTIBLE DEBT
The Company issued two convertible debentures to Investment Partners of America,
L.P. (IPA), a New Jersey limited partnership in the amounts of $250,000 on
September 18, 1998 and $275,000 on October 27,1998. The first debenture was
issued directly to IPA and the second debenture was issued to IPA on behalf of
eight of its regular customers, all of whom are accredited investors. The
debentures pay 6.5% interest and mature six months from the date of issuance.
The debentures are convertible into shares of the Class A common stock at the
then current market price, but not greater than $2.00 per share and no less than
$1.00 per share. The shares of Class A common stock issuable upon conversion of
the debentures carry price protection in that the holders of such shares will
receive additional shares equal to the price difference if the Company sells
shares to a third party at a price less than the conversion price. In addition,
an affiliate of IPA received a six-month consulting agreement with the Company
for $5,000 monthly on October 27, 1998. The maturity dates of the debentures
have been extended to May 21, 1999.
To obtain cash needed to fund the Company's payroll and other administrative
expenses, the Company borrowed $30,000 from Fairview Development Fund. The
loan bears interest at 14% per annum and is due and payable on April 30, 1999.
The loan is to be collateralized by 125,000 shares of newly-issued Class A
Common Stock of the Company.
NOTE G :
COMPREHENSIVE INCOME
Effective October 1, 1998, the company adopted Statement of financial Accounting
Standard No. 130 ("SFAS 130"), Reporting Comprehensive Income. SFAS 130
establishes new rules for the reporting and display of comprehensive income and
its components. The adoption of SFAS 130 had no impact on the Company's results
of operations for the three and six months ended February 28, 1998 and 1999. The
net loss of $774,000 and $457,000
8
<PAGE>
<PAGE>
recorded for the three months ended February 28, 1998 and 1999 and the net loss
of $773,000 and $1,139,000 recorded for the six months ended February 28, 1998
and 1999, respectively, is equal to the comprehensive loss for those periods.
NOTE H :
NEED FOR ADDITIONAL FINANCING
The accompanying financial statements have been prepared on a going concern
basis which contemplates the continuation of operations, realization of assets
and liquidation of liabilities in the ordinary course of business. The Company
will require substantial additional financing in the immediate future to fully
implement its proposed business plan. Former sources of capital are not
obligated, but may contribute, loan or provide any additional financing to the
Company. The Company has no binding commitments from any third parties to
provide funds to the Company. There can be no assurances that additional
financing will be available on terms favorable or acceptable to the Company,
if at all. In addition, if the convertible debentures issued to Investment
Partners of America, L.P. are not converted, the Company will have to repay
such debentures in May 1999. Unless the Company obtains additional financing
provided by a private placement, the completion of license agreement and
strategic alliances, the Company will not have sufficient funds to repay such
debentures. The Company does not expect its existing cash, together with funds
anticipated to be generated through operations, to be sufficient to meet the
Company's cash requirements beyond April 1999. Failure to obtain such additional
financing would have a material adverse effect on the Company and could require
the Company to severely limit or cease its operations. The accompanying
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATION
GENERAL
Certain statements in this Report on Form 10-QSB ("Report") under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operation" and elsewhere constitute "forward-looking statements" within the
meaning of Private Securities Litigation Reform Act of 1995, including, without
limitation, statements regarding future cash requirements. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance, or achievements of the Company,
or industry results, to be materially different from any future results,
performance, or achievements expressed or implied by such forward-looking
statements. Such factors include, among others, the following: limited
commercial operations; no assurances of success; need for additional financing;
uncertainty of market acceptance; reliance on collaborative agreements;
competition and rapid technological change; failure to receive or delays in
receiving regulatory approval; limited manufacturing and assembly experience;
limited marketing and sales experience; dependence upon, and need for, key
personnel; uncertain protection of patent and proprietary rights; lack of
reimbursement; general economic and business conditions; industry capacity;
industry trends; demographic changes; changes in business strategy or
development plans; quality of management; availability, terms and deployment of
capital; potential adverse impact of FDA and other government regulations;
limitations on third party reimbursement; potential adverse impact of
anti-remuneration laws; potential product liability; risk of loss in lawsuit;
risk of low-priced stocks; and other factors referenced in this Report and
described in the Company's Report on Form 10-KSB for the fiscal year ended
August 31, 1998. When used in this Report, statements that are not statements
of material fact may be deemed to be forward-looking statements. Without
limiting the foregoing, the words "anticipates," "plans," "intends,"
"estimates," "projects," "believes," "expects" and similar expressions are
intended to identify such forward-looking statements. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
only as of the date hereof. The Company undertakes no obligation to publicly
release the result of any revisions to these forward-looking statements that
may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
9
<PAGE>
<PAGE>
RESULTS OF OPERATIONS
Six Months Ended February 28, 1999 and 1998
REVENUES:
The Company had revenues of $188,759 which included $23,759 of product sales and
$165,000 of license fees for the six months ended February 28, 1999 as compared
to license revenues of $800,000 for the six months ended February 28, 1998.
The Company had cost of sales of $15,299 for the six months ended February 28,
1999 as compared to no cost of sales associated with the license fees for the
six months ended February 28, 1998.
RESEARCH AND DEVELOPMENT:
Research and Development expenses increased $22,321 or 3.2% from $696,499 during
the six months ended February 28, 1998 to $718,820 during the six months ended
February 28, 1999 because of an increased allocation of facilities space and
payroll, which was partially offset by a decrease related to a computer
conversion in the six months ended February 28, 1998.
MARKETING, GENERAL AND ADMINISTRATIVE:
Marketing, General and Administrative expenses decreased $323,179 or 36.7% from
$879,431 during the six months ended February 28, 1998 to $556,252 during the
six months ended February 28, 1999 because of a large decrease in legal
expenses. The February 28, 1998 six months included legal expenses for the EP
MedSystems litigation, satisfying listing requirements on the NASDAQ Small Cap
Market, a license agreement with Medtronic, and an agreement with Alliance
Partners to reclassify a contingent liability to permanent capital. The Company
also recognized $49,000 of compensation associated with the issuance of Class A
common stock to Alliance Partners in the quarter ended February 28, 1998. The
decreased allocations of certain payroll and facility expenses in the six months
ended February 28, 1999 contributed to the decline in Marketing, General and
Administrative expenses. All of this was partially offset by an increase in
legal expenses related to financing activities.
RESULTS OF OPERATIONS
Three Months Ended February 28, 1999 and 1998
REVENUES:
The Company had revenues of $173,040 which included $8,040 of product sales and
$165,000 of license fees for the three months ended February 28, 1999 as
compared to no revenue for the three months ended February 28, 1998.
RESEARCH AND DEVELOPMENT:
Research and development expenses decreased $26,021 or 7.3% from $355,103 during
the three months ended February 28, 1998 to $329,085 during the three months
ended February 28, 1999 because of a decrease in materials purchased and
consultant fees that was partially offset by an increased allocation of
facilities space and payroll.
10
<PAGE>
<PAGE>
MARKETING, GENERAL AND ADMINISTRATIVE:
Marketing, General and Administrative expenses decreased $144,868 or 35.5%
during the three months ended February 28, 1999 because of a large decrease in
legal expenses. The February 28, 1998 three months included legal expenses for
EP MedSystems litigation and satisfying listing requirements on the NASDAQ Small
Cap Market. The decreased allocation of certain payroll and facility expenses in
the three months ended February 28, 1999 contributed to the decline in
Marketing, General and Administrative expenses. All of this was partially offset
by an increase in cost related to the initiation of a private placement.
LIQUIDITY AND CAPITAL RESOURCES
NEED FOR ADDITIONAL FINANCING
At February 28, 1999, the Company had a working capital deficiency of
$1,731,225. Subsequent to that date, the Company obtained $30,000 from the
extension of an option and an additional $30,000 from a short-term working
capital loan. See Notes D and F to the Consolidated Financial Statements,
respectively. Certain outstanding debentures having an aggregate principal
amount of $525,000 become due in May 1999. The Company is in immediate need
of additional financing and does not expect its existing cash, together with
funds anticipated to be generated through operations, to be sufficient to meet
the Company's cash requirements beyond April 1999. Although the Company is
presently seeking additional financing, there can be no assurance that such
financing will be obtained within the necessary time frame on terms acceptable
to the Company, or at all. Failure to obtain additional financing would have a
material adverse effect on the Company and could require the Company to severely
limit or cease its operations.
YEAR 2000 COMPATIBILITY
The Company is working to resolve the potential impact of the year 2000 on the
ability of the Company's computerized information systems to accurately process
information that may be date sensitive. Any of the Company's programs or
computer-assisted systems that recognize a date using "00" as the year 1900
rather than 2000 could result in errors or system failures. It is also possible
that certain computer systems or software products of the Company's suppliers
and contractors may not be year 2000 compatible. The Company is requesting
assurance from all software vendors from which it has purchased or from which it
may purchase software that such software will correctly process all date
information at all times. Furthermore, the Company is querying its suppliers and
contractors as to their progress in identifying and addressing problems that
their computer and other technological systems will face in correctly processing
date information as the year 2000 approaches. The Company has not completed its
assessment, but currently believes that costs of addressing this issue will not
have material adverse impact on the Company's financial position. However, if
the Company and third parties upon which it relies are unable to address this
issue in a timely manner, it could result in a material financial risk to the
Company. In order to assure that this does not occur, the Company plans to
devote all resources required to resolve any significant Year 2000 issues in a
timely manner.
11
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<PAGE>
</TABLE>
<TABLE>
<CAPTION>
PART II: OTHER INFORMATION
<S> <C>
Item 1: Legal Proceedings - None
Item 2: Changes in Securities and Use of Proceeds - None
Item 3: Defaults Upon Senior Securities - None
Item 4: Submission of Matters to a Vote of Security Holders - None
Item 5: Other Information - None
Item 6: Exhibits and Reports on Form 8-K
a) Exhibits
27 Financial Data Schedule
b) Reports on Form 8-K-None
</TABLE>
12
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: April 19, 1999
EchoCath, Inc.
----------------------------
(Registrant)
By: /s/ Frank DeBernardis
-----------------------------------
Frank DeBernardis
President, Chief Executive Officer,
Principal Financial and Accounting
Officer
STATEMENT OF DIFFERENCES
The registered trademark symbol shall be expressed as...................... 'r'
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<FISCAL-YEAR-END> AUG-31-1999
<PERIOD-START> SEP-1-1998
<PERIOD-END> FEB-28-1999
<PERIOD-TYPE> 6-MOS
<CASH> 94,291
<SECURITIES> 0
<RECEIVABLES> 65,000
<ALLOWANCES> 0
<INVENTORY> 174,873
<CURRENT-ASSETS> 404,192
<PP&E> 709,403
<DEPRECIATION> 481,403
<TOTAL-ASSETS> 931,901
<CURRENT-LIABILITIES> 2,135,417
<BONDS> 0
<COMMON> 11,272,304
0
1,393,889
<OTHER-SE> (14,078,842)
<TOTAL-LIABILITY-AND-EQUITY> 931,901
<SALES> 0
<TOTAL-REVENUES> 188,759
<CGS> 0
<TOTAL-COSTS> 1,290,371
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 37,546
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,139,158)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,139,158)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
