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FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
QUARTERLY OR TRANSITIONAL REPORT
U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
----------- SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 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 1-14160
HelpMate Robotics Inc.
(Exact name of small business issuer as
specified in its charter)
Connecticut 06-1110906
-------------------------------- ------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Shelter Rock Lane; Danbury, Connecticut;06801
---------------------------------------------
(Address of principal executive offices)
(203) 798-8988
---------------------------
(Issuer's telephone number)
-----------------------------------------------------------------
(Former name, former address and formal fiscal year,
if changed since last report)
Check whether the issuer (1) 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
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDING DURING THE
PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by a court. Yes No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
The number of shares outstanding of the registrant's common stock as of
August 1, 1996 is 6,335,205 shares.
Transitional Small Business Disclosure Format (Check One) Yes No X
--- ---
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
HelpMate Robotics Inc.
Balance Sheet (Unaudited)
June 30, 1996
ASSETS
Current Assets:
Cash and cash equivalents $ 3,312,844
Accounts receivable, net of allowance for doubtful accounts
of $43,747 536,917
Inventory, net 1,960,724
Prepaid expenses and other 208,687
------------
Total current assets 6,019,172
Property and equipment, net 2,112,762
------------
$ 8,131,934
============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 841,749
Accrued expenses 107,106
Current portion long term debt 245,704
Customer advances 18,080
------------
Total current liabilities 1,212,639
Long term debt, less current portion 1,610,556
Stockholders' equity:
Common stock, no par value; 10,000,000 shares authorized;
6,335,205 shares issued and outstanding 16,785,548
Capital surplus 5,128,525
Accumulated deficit (16,605,334)
------------
Total stockholders' equity 5,308,739
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$ 8,131,934
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SEE ACCOMPANYING NOTES
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HelpMate Robotics Inc.
Statements of Operations (Unaudited)
Six months ended June 30, 1996 and 1995
Six months ended June 30
1996 1995
------ ------
Revenues:
Sales revenues $ 563,562 $ 536,326
Rental revenues 556,805 466,102
Research and development contracts 174,550 62,158
--------------------------
Total revenues 1,294,917 1,064,586
Cost of revenues:
Cost of sales 348,668 353,275
Cost of rental revenues 377,480 310,080
Cost of research and development contracts 162,175 79,580
--------------------------
Total costs of revenues 888,323 742,935
--------------------------
Gross profit 406,594 321,651
Selling, general and administrative expenses 1,892,741 1,427,199
Non cash compensation expense 45,938 120,000
--------------------------
1,938,679 1,547,199
Operating loss (1,532,085) (1,225,548)
Interest expense, net (90,098) (115,923)
Other expense, net (18,245) (16,271)
--------------------------
(108,343) (132,194)
--------------------------
Net loss (1,640,428) (1,357,742)
Preferred stock dividends paid 57,147 381,096
--------------------------
Net loss applicable to common stock $(1,697,575) $(1,738,838)
==========================
Per share amounts:
Net loss applicable to common stock $ (.31) $ (1.07)
==========================
Weighted average. number of shares of
common stock outstanding 5,488,355 1,620,962
==========================
Supplemental net loss applicable to common
stock $ (.28)
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Supplemental weighted average number of
shares of common stock outstanding 5,796,895
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SEE ACCOMPANYING NOTES
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HelpMate Robotics Inc.
Statements of Operations (Unaudited)
Three months ended June 30, 1996 and 1995
Three months ended June 30
1996 1995
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Revenues:
Sales revenues $ 350,624 $ 158,613
Rental revenues 304,533 236,816
Research and development contracts 174,550 62,158
--------------------------
Total revenues 829,707 457,587
Cost of revenues:
Cost of sales 235,157 105,005
Cost of rental revenues 189,095 152,981
Cost of research and development contracts 162,175 79,580
--------------------------
Total costs of revenues 586,427 337,566
--------------------------
Gross profit 243,280 120,021
Selling, general and administrative expenses 997,934 668,390
Non cash compensation expense 45,938 120,000
--------------------------
1,043,872 788,390
Operating loss (800,592) (668,369)
Interest expense, net (28,756) (57,818)
Other expense, net (11,747) (21,548)
--------------------------
(40,503) (79,366)
--------------------------
Net loss (841,095) (747,735)
Preferred stock dividends paid - 192,164
--------------------------
Net loss applicable to common stock $ (841,095) $ (939,899)
==========================
Per share amounts:
Net loss applicable to common stock $ (.13) $ (.58)
==========================
Weighted average. number of shares of
common stock outstanding 6,371,061 1,622,407
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SEE ACCOMPANYING NOTES
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HelpMate Robotics Inc.
Statements of Cash Flows (Unaudited)
Six months ended June 30, 1996 and 1995
Six months ended June 30
1996 1995
------ ------
OPERATING ACTIVITIES
Net loss $(1,640,428) $(1,357,742)
Adjustments to reconcile net loss to net cash
used by operating activities:
Rent - 69,480
Compensation 45,938 120,000
Interest 133,208 88,576
Depreciation 324,398 292,864
Other 15,774 -
Changes in operating accounts:
(Increase) decrease in accounts receivable (235,806) 186,331
(Increase) in inventory (748,539) (315,083)
(Increase) in prepaid expenses and other (185,727) (120,049)
Increase in accounts payable and accrued expenses 443,264 169,586
(Decrease) increase in customer advances (101,833) 59,476
--------------------------
Total adjustments (309,323) 551,181
--------------------------
Net cash used in operating activities (1,949,751) (806,561)
--------------------------
INVESTING ACTIVITIES
Purchase of property and equipment (833,110) (169,903)
--------------------------
Net cash used in investing activities (833,110) (169,903)
--------------------------
FINANCING ACTIVITIES
Repayments of notes payable (197,670) (221,253)
Proceeds from exercise of stock options 1,829 -
Redemption of common stock issued for rent (210,000) -
Proceeds from issuance of common stock,
net of expenses 6,138,941 -
Proceeds from issuance of notes payable - 700,000
Preferred stock dividends paid (57,147) -
--------------------------
Net cash provided by financing activities 5,675,953 478,747
--------------------------
Net increase (decrease) in cash and cash
equivalents 2,893,092 (497,717)
Cash and cash equivalents at beginning of period 419,752 549,252
--------------------------
Cash and cash equivalents at end of period $ 3,312,844 $ 51,535
==========================
SEE ACCOMPANYING NOTES
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HelpMate Robotics Inc.
Notes to Condensed Financial Statements (Unaudited)
June 30, 1996
BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Item 310
of Regulation S-B. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all adjustments,
consisting only of normal recurring accruals, considered necessary for a fair
presentation have been included in the accompanying unaudited financial
statements. In addition, certain amounts for prior periods have been
reclassified to be comparable with the current period presentation.
Operating results for the three and six month periods ended June 30, 1996 are
not necessarily indicative of the results that may be expected for the full
year ending December 31, 1996. For further information, refer to the
financial statements and footnotes thereto included in the Company's annual
report on Form 10-KSB for the year ended December 31, 1995.
INITIAL PUBLIC OFFERING
The Company completed an initial public offering on January 31, 1996 of
1,449,918 units with each unit consisting of two shares of common stock, no
par value per share, and one redeemable common stock purchase warrant,
whereby 1,252,996 units were sold by the Company and 196,922 units were sold
by certain lenders who provided interim financing to the Company (the
"Selling Bridge Securityholders"). The Company received proceeds of
approximately $6.1 million net of expenses of approximately $1.7 million and
intends to use such proceeds for, among other things, the expansion of its
sales and marketing activities. Further, $210,000 of the proceeds were used
to redeem certain common shares issued for rent.
Immediately prior to the closing of the initial public offering, the
following became effective: (i) all outstanding shares of preferred stock of
the Company were converted into common stock, (ii) certain convertible notes
issued to the Selling Bridge Securityholders in the original principal amount
of $800,000 were converted into 196,622 units, (iii) the Company's
certificate of incorporation was amended to increase the authorized common
stock of the Company to 10,000,000 shares, (iv) the Company's certificate of
incorporation was amended to eliminate the class of preferred stock, and (v)
a 4.93599 - to - 1 stock split with respect to common stock was effected.
Accordingly, all common share amounts have been restated to give effect to
the 4.93599 - to - 1 stock split.
EARNINGS PER SHARE AND SUPPLEMENTAL NET LOSS PER SHARE
Earnings per common share is computed using the treasury stock method
based on the weighted average number of common shares and common stock
equivalent shares outstanding during the period, as adjusted retroactively
for the aforementioned stock split. Shares from the assumed exercise of
options and warrants granted by the Company and shares issuable in connection
with the Company's convertible preferred stock have been included in the
computations of earnings per share for all periods unless their inclusion
would be anti-dilutive. However, for purposes of computing net loss per
share, options and warrants granted by the Company during the 12 months
preceding the initial public offering date, including those shares issuable
in connection with the anti-dilution provisions of certain warrant
agreements, have been included in the calculation of common stock and common
stock equivalent shares outstanding as if they were outstanding for all
periods presented using the treasury stock method and the public offering
price of $6.25 per unit or $3.00 per share and $0.25 per warrant.
Supplemental net loss per share of common stock for the six month period
ended June 30, 1996 was ($0.28). Supplemental net loss per share of common
stock is computed using the if-converted method based on the pro forma
weighted average number of shares of common stock and common stock equivalent
as defined above, and convertible preferred shares that were converted into
common stock on a 1-4.55 basis upon the closing of the initial public
offering, adjusted retroactively for the aforementioned stock split. Net
loss per share used in the supplemental loss per share calculation was
decreased for dividend requirements on preferred shares.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
GENERAL
The Company was founded in 1984 to perform consulting services, provide
seminar leadership and undertake, on a contract basis, engineering and
research and development projects related to robotics and robotics
applications. These activities subsequently branched into product
development, culminating in the development of several products having
commercial applications, and ultimately, in the Company's flagship product,
the HelpMate-Registered Trademark- robotics courier system. The Company
historically has derived revenue from three principal sources: rentals of
HelpMates, sales of HelpMates and to a lesser extent research and development
contracts. The Company also has derived revenues from the sale of other
robotic components such as LabMate, LightRanger and BiSight.
The Company's near-term objective is to attain profitability by
establishing the HelpMate robotics system as a flexible, cost-efficient and
preferred method for transporting materials within hospitals and other
healthcare facilities. Although the Company believes that its HelpMate robots
have demonstrated their viability, the Company historically had insufficient
funding to engage in a full-scale marketing program. The Company's business
strategy is to (a) build a marketing and customer service staff that will
implement its marketing program for the rental and sale of HelpMates to
hospital users within North America, and (b) enhance its HelpMate robotics
systems through product improvement, cost reduction and new feature
development. The Company has hired five individuals throughout the United
States in the first six months of 1996 as a means to help it achieve this
objective. In addition, the Company recently resumed its presentation of
HelpMates at trade shows and has planned to attend at least five such shows
in 1996 and one in 1997. Two such shows were attended in the first six months
of 1996, resulting in a significant amount of prospective customers. The
Company is also exploring distribution opportunities in North America through
third parties. To that end, the Company entered into an agreement with Bell &
Howell Mailmobile Company ("Bell & Howell") pursuant to which Bell & Howell
became the Company's marketing representative, on a nonexclusive basis, for
HelpMates and peripheral equipment in certain southwestern states. However,
to date the Company's relationship with Bell & Howell has not proved fruitful
(no orders received to date) and therefore the Company is reevaluating its
arrangement with Bell & Howell. The Company has also contracted with a health
care equipment manufacturer's representative to handle the greater New York
area and retained two public relations firms to help promote Helpmate.
Revenues from products sales are recognized after delivery, installation
and training of customers on the product. Revenues from maintenance contracts
on product sales are recognized on a straight line basis over the life of the
contract. Revenues from sales to licensees are recognized upon shipment.
Revenues from product rentals pursuant to monthly operating equipment leases
are recognized on a straight-line basis over the lease term. Research and
development contracts are comprised principally of studies and prototypes of
robotic applications predominantly for governmental agencies and are
accounted for under the percentage of completion method, based upon costs
incurred.
INITIAL PUBLIC OFFERING
The Company completed an initial public offering on January 31, 1996 of
1,449,918 units with each unit consisting of two shares of common stock, no
par value per share, and one redeemable common stock purchase warrant,
whereby 1,252,996 units were sold by the Company and 196,922 units were sold
by certain lenders who provided interim financing to the Company (the
"Selling Bridge Securityholders"). The Company received proceeds of
approximately $6.1 million net of expenses of approximately $1.7 million and
has begun to use such proceeds for, among other things, the expansion of its
sales and marketing activities. Further, $210,000 of the proceeds were used
to redeem certain common shares issued for rent.
REVENUES
Total revenues increased by $230,331 or 21.64% from the six months
ended June 30, 1995 compared to the six month period ended June 30, 1996.
Rental revenues increased by $90,703 or 19.46%; sales revenues increased by
$27,236 or 5.08% and revenues from research and development contracts
increased by $112,392 or 180.82% for the same periods.
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Total revenues increased by $372,120 or 81.32% from the three months
ended June 30, 1995 compared to the three months ended June 30, 1996. Rental
revenues increased by $67,717 or 28.59%; sales revenues increased by $192,011
or 121.06% and revenues from research and development contracts increased by
$112,392 or 180.82% for the same period.
The increase in rental revenues is reflective of the Company's expanded
base of units being rented which is currently 41, an increase from the 26
units under rent at June 30, 1995. It should further be noted that the
Company's backlog for rental units has increased to 13 units from 7 units at
June 30, 1995. The increase in sales revenues was attributable to an
increase in sales of the Company's robotic components to a variety of
universities around the globe. Sales of HelpMate robots are comparable for
the six months ended June 30, 1996 and 1995. The increase in research and
development contract revenues is primarily attributable to the completed
contract for the first phase of a NASA sponsored program entitled "Two
Armed, Mobile, Sensate Research Robot."
COST OF REVENUES
Cost of revenues increased by $145,388 or 19.57% from the six months
ended June 30, 1995 compared to the six months ended June 30, 1996. Cost of
revenues increased by $248,861 or 73.72% from the three months ended June 30,
1995 compared to the three months ended June 30, 1996. The increase in cost
of revenues generally reflects the increase in the revenues discussed above.
GROSS PROFIT
Gross profit increased by 26.41% or $84,943 from the six months ended
June 30, 1995 compared to the six months ended June 30, 1996. Gross profit
increased by 102.7% or $123,259 from the three months ended June 30, 1995
compared to the three months ended June 30, 1996. The increase is gross
profit dollars reflects the increase in revenues discussed above. Further,
gross profit as a percentage of sales increased by 3.9% to 31.4% in the six
months ended June 30, 1996 from the six months ended June 30, 1995 and
increased by 11.78% to 29.32% in the three months ended June 30, 1996 from
the three months ended June 30, 1995. The increase in gross profit as a
percentage of sales is reflective of the Company's on going strategy to
reduce costs and only accept research and development contracts that are
fully funded.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, General and Administrative Expenses increased by $465,542 or
32.62% from the six months ended June 30, 1995 compared to the six months
ended June 30, 1996. Selling, General and Administrative Expenses increased
by $329,544 or 49.3% from the three months ended June 30, 1995 compared to
the three months ended June 30, 1996. The increase reflects an increase in
staffing (including the hiring of five sales executives) and an increase in
marketing and public relations activity associated with promoting the
HelpMate robot. In addition, the Company also incurred costs required to
enhance the Company's HelpMate robotics systems through product improvement
and new feature development.
INTEREST EXPENSE
Interest expense decreased by $25,825 or 22.28% from the six months
ended June 30, 1995 compared to the six months ended June 30, 1996. Interest
expense decreased by $29,062 or 50.26% from the three months ended June 30,
1995 compared to the three months ended June 30, 1996. The decrease in
interest expense reflects interest income earned on the proceeds from the
Company's initial public offering offset by interest expense related to loans
received by the Company in the latter half of 1995. Such declines are not
expected to continue as the Company's use of cash will decrease the amount of
interest income earned.
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LOSSES
The Company incurred a net loss from continuing operations of $1,640,428
and $1,357,742 for each of the six month periods ending June 30, 1996 and
June 30, 1995, respectively and incurred a net loss from continuing
operations of $841,095 and $747,735 for each of the three month periods
ending June 30, 1996 and June 30, 1995, respectively. These losses were
sustained primarily because the Company has not achieved the volume of sales
and rentals of HelpMates required to cover the overhead expenses associated
with the commercialization of its HelpMate systems and due to the increase in
staffing and sales and marketing expenses noted above. The Company
anticipates that such losses will continue until the volume of sales and
rentals of HelpMates required to cover the overhead expenses is achieved.
The overall profitability of the Company is highly dependent upon its mix of
robot rentals and robot sales.
EARNINGS PER SHARE
Earnings per share of common stock for the six months ended June 30,
1996 and 1995 was ($0.31) and ($1.07), respectively. Earnings per share of
common stock for the three months ended June 30, 1996 and 1995 was ($0.13)
and ($.58), respectively. The reduction in the net loss per share is
attributable to the increase in number of shares outstanding from the
aforementioned initial public offering. Earnings per common share is
computed using the treasury stock method based on the weighted average number
of common shares and common stock equivalent shares outstanding during the
period, as adjusted retroactively for the aforementioned stock split.
Shares from the assumed exercise of options and warrants granted by the
Company and shares issuable in connection with the Company's convertible
preferred stock have been included in the computations of earnings per share
for all periods unless their inclusion would be anti-dilutive. However, for
purposes of computing net loss per share, options and warrants granted by the
Company during the 12 months preceding the initial public offering date,
including those shares issuable in connection with the anti-dilution
provisions of certain warrant agreements have been included in the
calculation of common stock and common stock equivalent shares outstanding as
if they were outstanding for all periods presented using the treasury stock
method and the public offering price of $6.25 per unit or $3.00 per share and
$0.25 per warrant.
Supplemental net loss per share of common stock for the six months ended
June 30, 1996 was ($0.28). Supplemental net loss per share of common stock
is computed using the if-converted method based on the pro forma weighted
average number of shares of common stock and common stock equivalent as
defined above, and convertible preferred shares that were converted into
common stock on a 1-4.55 basis upon the closing of the initial public
offering, adjusted retroactively for the aforementioned stock split. Net
loss per share used in the supplemental loss per share calculation was
decreased for dividend requirements on preferred shares.
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION ("EBITDA")
EBITDA decreased by $276,977 or 29.19% from the six months ended June
30, 1995 compared to the six months ended June 30, 1996 to ($1,225,932).
EBITDA decreased by $67,933 or 11.56% from the three months ended June 30,
1995 compared to the three months ended June 30, 1996 to ($655,623). This
decrease is reflective the Company's increase in selling, general and
administrative costs noted above.
LIQUIDITY AND CAPITAL RESOURCES
Prior to the Company's initial public offering, the Company historically
had been dependent upon loans from its principal securityholders and their
affiliates, private placements of its debt and equity securities, and
certain financing transactions with Hospital Transporters Limited Partnership
("Transporters") (an entity in which the Company's Chairman and President are
limited partners) and Center Capital Corporation ("CCC") pursuant to which
the Company assigned the revenue stream to certain HelpMate robots and
assigned the existing rental agreements related thereto in exchange for lump
sum payments to the Company to finance its working capital requirements.
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The Company believes the proceeds of its initial public offering,
together with the proceeds from the interim loans provided by the Selling
Bridge Securityholders and anticipated revenues from operations will be
sufficient to satisfy the Company's contemplated cash requirements into early
1997. However, the Company's actual results may differ, as a result of among
other things, the Company's cash requirements being highly dependent upon
the Company's mix of robot rentals and robot sales (i.e., more robot rentals
than sales could result in the Company requiring cash at a date earlier than
anticipated). To date, the Company's mix of robot rentals and robot sales
has been significantly weighted to the rental side, resulting in a slower
replenishment of cash than originally anticipated. This is attributable to
Bell & Howell not meeting its expectations of placing units (As noted above
the Company is evaluating its relationship with Bell & Howell); Otis
Elevator reducing its order forecast from 26 to 6 units for 1996 and a slight
(three month) delay from original expectations, in establishing an effective
sales and marketing organization. The Company believes that it can, as it has
done in the past, enter into financing transactions whereby the Company's
rental agreements could be transferred in exchange for lump sum payments
providing it with the necessary capital. The Company currently has no such
arrangements with respect to, or sources of future financing, nor is there
any assurance that additional financing will be available to the Company.
It should further be noted that in connection with the Company's initial
public offering, 1,449,918 warrants were issued, which entitles the holder of
said warrant to purchase one share of commons stock at $5.75 per share until
January 21, 2001. Each warrant is redeemable by the Company for $0.01 per
Warrant upon thirty days written notice, provided that the average closing
bid price of the Company's common stock is $7.00 or more per share for ten
consecutive trading days. The average closing bid price of the Company's
common stock on August 2, 1996 was $2.00.
The Company's liquidity is also affected by its royalty obligations to
Connecticut Innovations, Incorporated ("CII"). Pursuant to its original
agreements with CII, the Company must pay royalties aggregating $2,205,000 to
CII. As of June 30 1996, the Company had paid approximately $234,000 in such
royalties to CII. In January 1996, the Company and CII agreed that during the
two-year period commencing on the closing of the Company's initial public
offering , the obligation to pay a royalty at a rate of five percent of sales
of sponsored products would be reduced so that the payment with respect
thereto would not exceed the greater of (i) one and one-half percent of the
net sales of sponsored products or (ii) twenty percent (20%) of the Company's
pre-tax profits (but in no event would such payment be more than five percent
of net sales of sponsored products). As consideration for the reduction, the
Company received a credit of $300,000 against the $2,205,000 royalty
obligation and issued to CII 50,000 shares of common stock and a warrant to
purchase 25,000 additional shares exercisable at $5.75 per share. In
addition, the Company, at its option, may extend the period permitting
reduced royalty payments for an additional two years and receive another
$300,000 credit by issuing to CII an additional 50,000 shares of common stock
and another warrant to purchase 25,000 additional shares exercisable at $5.75
per share. Further, the Company must continue to pay royalties for a period
equal to the period of time taken to satisfy this $2,205,000 royalty
obligation, except that the royalty rate on the Company's net sales of
sponsored products shall be reduced to one half of one percent during such
period.
For the foreseeable future, the Company does not anticipate paying
dividends and the Company anticipates retaining any earnings to fund its
operations. Moreover, the ability of the Company to pay dividends is subject
to contractual restrictions through September 2001. Specifically, during that
period, the Company may not, unless otherwise approved by one of its lenders,
directly or indirectly declare, order, pay or reserve any sum or property for
the payment of any dividend or other distribution on the Company's capital
stock until such time as the Company has achieved a net profit for three
consecutive fiscal quarters.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
NONE
ITEM 2. CHANGES IN SECURITIES
The Company completed an initial public offering on January 31, 1996 of
1,449,918 units with each unit consisting of two shares of common stock, no
par value per share, and one redeemable common stock purchase warrant,
whereby 1,252,996 units were sold by the Company and 196,922 units were sold
by certain lenders who provided interim financing to the Company (the
"Selling Bridge Securityholders"). In connection with the aforementioned
initial public offering, the Company's common stock split at a rate of
4.93599 to 1, all of the Company's preferred stock was converted into common
stock, a $120,000 obligation to the Company's Chairman was converted into
19,200 Units, 50,000 shares of common stock were issued in connection with
the January 1996 amendment to the Company's 1987 Development Contract with
Connecticut Innovations, Incorporated, the Company's treasury stock was
canceled and the 34,552 shares of common stock owned by Westinghouse Electric
Corporation were redeemed.
The Company's Units, Common Stock and warrants were quoted on the
NASDAQ - Small Cap Market System and listed on The Philadelphia Stock
Exchange on January 31, 1996 and February 9, 1996, respectively. Effective
April 8, 1996, the Units were no longer quoted on the NASDAQ - Small Cap
Market System but are quoted on the NASDAQ - Bulletin Board System.
The Company has not paid nor does it anticipate paying cash dividends on
the Common Stock in the foreseeable future since it currently intends to
retain any earnings for use in its business. In addition, in connection with
certain financing provided to the Company by Connecticut Innovations,
Incorporated ("CII") in June 1995 and in September 1995, the Company agreed
that for a period of six years, it would not directly or indirectly declare,
order, pay or reserve any sum or property for the payment of any dividend or
other distribution on the Company's capital stock until such time as the
Company has achieved a net profit for three consecutive fiscal quarters.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
NONE
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Company's Annual Meeting of Stockholders held on May 21, 1996 the
following proposals were adopted by the margins indicated:
1. To elect eight directors for a term to expire at the 1997 Annual Meeting.
Director For Against
--------- --------- -------
Joseph F. Engelberger 4,857,002 4,400
Thomas K. Sweeny 4,857,002 4,400
John M. Evans, Jr. 4,857,002 4,400
John F. Barry 4,857,002 4,400
Nobuo Saita 4,857,002 4,400
Kevin F. Littlejohn 4,857,002 4,400
Theodore Sall 4,857,002 4,400
Sheldon Sandler 4,857,002 4,400
11
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2. To ratify the appointment of Ernst & Young LLP as the Company's
independent auditors for fiscal 1996
For 4,828,597
Against 7,000
Abstained 10,500
3. To adopt the Amended and Restated 1995 Stock Option Plan.
For 2,770,103
Against 22,300
Abstained 11,400
ITEM 5. OTHER INFORMATION
NONE
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K were filed by the registrant during the first quarter
of 1996.
NO. DESCRIPTION OF EXHIBIT
3.01 Amended and Restated Certificate of Incorporation of Registrant as
filed on December 28, 1995 (Incorporated by reference to Form SB2
No. 33-99348 filed January 31, 1996, Exhibit No. 3.02)
3.02 Form of By-Laws of the Registrant, as amended .(Incorporated by
reference to Form SB2 No, 33-99348 filed January 31, 1996, Exhibit
No. 3.03)
4.01* Form of Common Stock Certificate
4.02* Form of Warrant Certificate
4.03* Form of Unit Certificate
4.04* Form of Warrant Agreement
4.05* Form of Underwriters' Unit Purchase Option
4.06* Pages of the Registrant's Certificate of Incorporation that define
the rights of holders of the securities being registered hereby are
incorporated herein by reference to pages 3, 4, 6 and 7 of
Exhibit 3.01
4.07* Pages of the Registrant's By-Laws that define the rights of holders
of the securities being registered hereby are incorporated herein by
reference to pages 1, 2, 3, 4, 5, 6, 12 and 13 of Exhibit 3.02
10.01* Loan Agreement dated November 20, 1990 with Connecticut Innovations,
Incorporated ("CII").
10.02* $500,000 Promissory Note dated November 20, 1990 in favor of CII.
10.03* Security Agreement dated November 20, 1990 in favor of CII.
10.04* Loan Agreement May 26, 1995 with Joseph F. Engelberger ("Mr.
Engelberger").
10.05* $320,000 Promissory Note dated May 26, 1995 in favor of Mr.
Engelberger.
10.06* Financing Agreement dated June 14, 1995 with CII.
10.07* $500,000 Senior Note dated June 14, 1995 in favor of CII.
10.08* Security Agreement dated June 14, 1995 in favor of CII.
10.09* Subordination Agreement dated June 14, 1995 among the Registrant,
Mr. Engelberger and CII.
10.10* First Amendment to Financing Agreement dated September 20, 1995 with
CII.
10.11* $300,000 Senior Convertible Note dated September 20, 1995 in favor
of CII.
10.12* First Amendment to Security Agreement dated September 20, 1995 with
CII.
10.13* Amendment to Subordination Agreement dated September 20, 1995 with
CII.
10.14* Loan Agreement dated October 3, 1995 with Minnesota Mining and
Manufacturing Company ("3M").
10.15* $250,000 Note dated October 3, 1995 in favor of 3M.
10.16* Loan Agreement dated September 28, 1995 with Landmark Partners Inc.
("Landmark").
10.17* $150,000 Note dated September 28, 1995 in favor of Landmark.
10.18* Loan Agreement dated September 27, 1995 with Connecticut Financial
Developments, L.P. ("CFD").
10.19* $100,000 Note dated September 27, 1995 in favor of CFD.
12
<PAGE>
10.20* Sales and Maintenance Agreement with Hospital Transporters, Limited
Partnership dated as of August 19, 1994, with letter agreement dated
October 14, 1994, and letter agreement dated August 4, 1995.
10.21* Program Agreement dated May 30, 1995 with Center Capital Corporation.
10.22* Employment Agreement with Mr. Engelberger dated June 1, 1995 and
amended as of November 1, 1995.
10.23* Employment Agreement with John M. Evans, Jr. dated April 17, 1987
and amended as of February 1, 1995 and as of November 1, 1995.
10.24* Employment Agreement dated April 17, 1987 with Carl Weiman.
10.25* Employment Agreement dated April 17, 1987 with Bala Krishnamurthy.
10.26* Employment Agreement dated as of November 1, 1995 with Thomas K.
Sweeny ("Mr. Sweeny")
10.27* Stock Option Agreement dated as of November 1, 1995 with Mr. Sweeny.
10.28* Service Agreement dated February 1, 1995 with Landmark (terminated
pursuant to Exhibit 10.29)
10.29* Termination Agreement with Landmark dated as of November 1, 1995
10.30* Amended and Restated Buy and Sell Agreement dated April 17, 1987, as
amended on September.
10.31* Development Agreement dated May 1985 with Aktiebolaget Electrolux
("Electrolux").
10.32* Development Agreement dated April 15, 1987 with Electrolux.
10.33* Development Agreement dated May 1986 between Consolidated Controls
Corporation and Connecticut Product Development Corporation (assumed
by the Registrant and CII, respectively).
10.34* Royalty Reduction Agreement with CII.
10.35* Joint Venture Agreement, dated July 1, 1988 with Thrift Drug
Company, Automated Prescription Systems, Inc. ("APS") and Retired
Persons Services, Inc.
10.36* Agreement for Representation of Manufacturer/Licensee dated August,
1988 with APS.
10.37* Distributor Agreement, dated August 14, 1991, with Yaskawa Electric
Manufacturing Company, Ltd. ("Yaskawa").
10.38* Technology Transfer and License Agreement with Yaskawa dated as of
May 15, 1992.
10.39* License Agreement Dated as of December 21, 1992 with Electrolux.
10.40* Distribution Agreement dated on or about December 1, 1994 with a
subsidiary of Otis Elevator Company ("Otis").
10.41* Agreement for Sales with Bell & Howell Mailmobile dated October 18,
1995.
10.42* Lease dated as of November 1, 1992 with Westinghouse Electric
Corporation ("Westinghouse") for premises located at Shelter Rock
Lane in Danbury, Connecticut.
10.43* Letter Agreement dated October 21, 1992, with Westinghouse.
10.44* Directors and Officers Liability Insurance Policy.
10.45* Product Liability Insurance Policy.
10.46* Stock Purchase Agreement dated July 29, 1987 with Transitions Two,
Limited Partnership ("Transitions Two").
10.47* Stock Purchase Agreement, dated July 29, 1987 with 3M.
10.48* Stock Purchase Agreement dated February 24, 1989 with 3M, White
Consolidated Industries, Inc. ("White"), which is a subsidiary of
Electrolux, and Transitions Two, as amended by Amendment to Stock
Purchase Agreement, dated March 9, 1989.
10.49* Stock Purchase Agreement, dated August 14, 1991 with Yaskawa.
10.50* Preferred Stock Purchase Agreement dated as of May 28, 1993 with CFD.
10.51* Registration Rights Agreement dated as of May 28, 1993 with CFD.
10.52* Co-Sale Agreement among the Registrant, Mr. Engelberger, Margaret
Engelberger, Technology Transitions, Inc., 3M, White, Transitions
Two, Yaskawa and CFD.
10.53* Stock Purchase Agreement dated December 1, 1994 with Otis.
10.54* Warrant dated November 20, 1990, as amended on June 14, 1995, issued
to CII for 5,000 shares of the Registrant's Common Stock, expiring
on July 1, 2000.
10.55* Warrant dated January 16, 1991, issued to 3M for 3,000 shares of the
Registrant's Common Stock, expiring on February 1, 1997.
10.56* Warrant dated January 16, 1991, issued to Mr. Engelberger for 3,000
shares of the Registrant's Common Stock, expiring on February 1,
1997.
10.57* Warrant dated January 16, 1991, issued to White for 3,000 shares of
the Registrant's Common Stock, expiring on February 1, 1997.
10.58* Warrant dated January 16, 1991, issued to Transitions Two for 3,000
shares of the Registrant's Common Stock, expiring on February 1,
1997.
13
<PAGE>
10.59* Warrant dated July 6, 1992, issued to Mr. Engelberger for 2,000
shares of the Registrant's Common Stock, expiring on August 1, 1998.
10.60* Warrant dated July 6, 1992, issued to Transitions Two for 2,000
shares of the Registrant's Common Stock, expiring on August 1, 1998.
10.61* Warrant dated March 22, 1993, issued to Transitions Two for 5,000
shares of the Registrant's Common Stock, expiring on March 21, 1999.
10.62* Warrant dated July 1, 1993, issued to Electrolux for 4,300 shares of
the Registrant's Common Stock, expiring on June 30, 1999.
10.63* Warrant dated May 26, 1995, issued to Mr. Engelberger for 4,000
shares of the Registrant's Common Stock, expiring May 25, 2005.
10.64* Stock Subscription Warrant dated June 14, 1995, issued to CII for
10,000 shares of the Registrant's Common Stock, expiring June 14,
2005.
10.65* Warrant and Stock Put Agreement dated June 14, 1995 between the
Registrant and CII.
10.66* Stock Subscription Warrant dated September 20, 1995, issued to CII
for 6,000 shares of the Registrant's Common Stock, expiring
September 20, 2005.
10.67* Warrant and Stock Put Agreement dated September 20, 1995 with CII.
10.68* Stock Subscription Warrant dated October 3, 1995, issued to 3M for
5,000 shares of the Registrant's Common Stock, expiring
September 30, 2005.
10.69* Stock Subscription Warrant dated September 28, 1995, issued to
Landmark for 3,000 shares of the Registrant's Common Stock, expiring
September 30, 2005.
10.70* Stock Subscription Warrant dated September 27, 1995, issued to CFD
for 2,000 shares of the Registrant's Common Stock, expiring
September 30, 2005.
10.71* 1984 Nonqualified Stock Option Plan dated September 21, 1984.
10.72* 1988 Nonqualified Stock Option Plan dated October 27, 1988.
10.73 Amended and Restated 1995 Stock Option Plan (Incorporated by
reference to the Company's Proxy Statement for its 1996 Annual
Meeting of Stockholdrers)
11.1 Statement Re: Computation of Primary Per Share Earnings.
11.2 Statement Re: Computation of Fully Diluted Per Share Earnings
27. Financial Data Schedule for the six months ended June 30, 1996
* Incorporated by reference to Form SB2 Number 33-99348 filed January 31,
1996 under the same exhibit number as filed therein.
14
<PAGE>
SIGNATURES
In accordance with requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned , thereunto duly
authorized.
HelpMate Robotics Inc.
Date: August 9, 1996 /s/ Joseph F. Engelberger
---------------------------------------
Joseph F. Engelberger,
Chairman and Director
Date: August 9, 1996 /s/ Thomas K. Sweeny
---------------------------------------
Thomas K. Sweeny,
President, and Chief Executive Officer,
Director, Treasurer and PRINCIPAL
FINANCIAL OFFICER
15
<PAGE>
Exhibit 11.1
<TABLE>
<CAPTION>
HELPMATE ROBOTICS INC.
CALCULATION OF NET LOSS PER COMMON SHARE
------------------------------------------------------------
Six Months Six Months Three Months Three Months
Ended Ended Ended Ended
PRIMARY EARNINGS PER SHARE 06/30/96 06/30/95 06/30/96 06/30/95
------------------------------------------------------------
<S> <C> <C> <C> <C>
Historical
Net Loss $(1,640,428) $(1,357,742) $ (841,095) $ (747,735)
Preferred Dividends (57,147) (381,096) - (192,164)
------------------------------------------------------------
Net Loss Applicable to Common Shareholders $(1,697,575) $(1,738,838) $ (841,095) $ (939,899)
============================================================
Weighted Average Common Shares Outstanding 5,449,802 1,582,409 6,332,508 1,583,854
Incremental Shares Issuable Pursuant to SAB Topic 4D 38,553 38,553 38,553 38,553
------------------------------------------------------------
Total Shares 5,488,355 1,620,962 6,371,061 1,622,407
============================================================
Historical Net Loss per Common Share $ (.31) $ (1.07) $ (.13) $ (.58)
============================================================
</TABLE>
<PAGE>
Exhibit 11.2
<TABLE>
<CAPTION>
HELPMATE ROBOTICS INC.
CALCULATION OF NET LOSS PER COMMON SHARE
------------------------------------------------------------
Six Months Six Months Three Months Three Months
Ended Ended Ended Ended
SUPPLEMENTAL EARNINGS PER SHARE 06/30/96 06/30/95 06/30/96 06/30/95
------------------------------------------------------------
<S> <C> <C> <C> <C>
Historical
Net Loss Applicable to Shareholders $(1,640,428) $(1,357,742) $ (841,095) $ (747,735)
============================================================
Weighted Average Common Shares Outstanding 5,449,802 1,582,409 6,332,508 1,583,854
Incremental Shares Issuable Pursuant to SAB Topic 4D 38,553 38,553 38,553 38,553
Shares Applicable to Convertible
Preferred Stock 308,540 1,458,247 - 1,479,807
------------------------------------------------------------
Total Shares 5,796,895 3,079,209 6,371,061 3,102,214
============================================================
Historical Net Loss Per Common Share $ (.28) $ (.44) $ (.13) $ (.24)
============================================================
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 3,312,844
<SECURITIES> 0
<RECEIVABLES> 536,917
<ALLOWANCES> (43,747)
<INVENTORY> 1,960,724
<CURRENT-ASSETS> 6,019,172
<PP&E> 2,112,762
<DEPRECIATION> (1,572,929)
<TOTAL-ASSETS> 8,131,934
<CURRENT-LIABILITIES> 1,212,639
<BONDS> 0
0
0
<COMMON> 16,785,548
<OTHER-SE> (11,476,809)
<TOTAL-LIABILITY-AND-EQUITY> 8,131,934
<SALES> 563,562
<TOTAL-REVENUES> 1,294,917
<CGS> 348,668
<TOTAL-COSTS> 888,323
<OTHER-EXPENSES> 1,938,679
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 90,098
<INCOME-PRETAX> (1,640,428)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,640,428)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,640,428)
<EPS-PRIMARY> (.31)
<EPS-DILUTED> 0
</TABLE>
