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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended March 31, 2000
[ ] Transition Report pursuant to 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from __________ to __________
Commission File Number 0-25911
SKINVISIBLE, INC.
(Exact name of Small Business Issuer as specified in its charter)
Nevada 88-0344219
- ------------------------------- -------------------
(State or other jurisdiction of (IRS Employer
incorporation) Identification No.)
6320 South Sandhill Road, Suite 10, Las Vegas, Nevada 89120
-----------------------------------------------------------
(Address of principal executive offices)
702-433-7154
------------
(Issuer's telephone number)
(Former name, former address and former fiscal year if changed
since last report)
Check whether the issuer (1) filed all reports required 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. [X] Yes [ ] No
State the number of shares outstanding of each of the issuer's
classes of common equity as of the latest practicable date:
11,702,033 shares of Common Stock as of April 30, 2000.
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
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PART I FINANCIAL INFORMATION
Item 1. Financial Statements
GENERAL
The Company's unaudited financial statements for the three
months ended March 31, 2000 are included with this Form 10-QSB.
The unaudited financial statements for the three months ended
March 31, 2000 include:
(a) A Consolidated Balance Sheet as of March 31, 2000 and
March 31, 1999;
(b) A Consolidated Statement of Operations and Accumulated
Deficit - Three months ended March 31, 2000 and March
31, 1999;
(c) A Consolidated Statement of Changes in Shareholders'
Equity - Three months ended March 31, 2000 and March
31, 1999;
(d) A Consolidated Statement of Cash flows - Three months
ended March 31, 2000 and March 31, 1999;
(e) Notes to Consolidated Financial Statements
The unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB and, therefore,
do not include all information and footnotes necessary for a
complete presentation of financial position, results of
operations, cash flows, and stockholders' equity in conformity
with generally accepted accounting principles. In the opinion
of management, all adjustments considered necessary for a fair
presentation of the results of operations and financial position
have been included and all such adjustments are of a normal
recurring nature. Operating results for the three months ended
March 31, 2000 are not necessarily indicative of the results
that can be expected for the year ending December 31, 2000.
2
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SKINVISIBLE, INC.
AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000
3
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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page
----
Accountant's Review Report 3
Consolidated Financial Statements:
Consolidated Balance Sheet ............................... 4
Consolidated Statement of Operations
And Accumulated Deficit ............................... 5
Consolidated Statement of Changes in
Stockholders' Equity .................................. 6
Consolidated Statement of Cash Flows ..................... 7
Notes to Consolidated Financial Statements ............... 8 - 11
4
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To the Board of Directors
Skinvisible, Inc. and Subsidiary
Las Vegas, Nevada
We have reviewed the accompanying consolidated balance sheet of
Skinvisible, Inc., and subsidiaries, as of March 31, 2000 and
the related consolidated statements of operations and
accumulated deficit, changes in stockholders' equity, and
statement of cash flows for the three months then ended, in
accordance with standards established by the American Institute
of Certified Public Accountants. All information included in
these financial statements is the representation of the
management of Skinvisible, Inc.
A review consists principally of inquiries of Company personnel
and analytical procedures applied to financial data. It is
substantially less in scope than an examination in accordance
with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express
such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the accompanying financial
statements in order for them to be in conformity with generally
accepted accounting principles.
Sarna & Company
Westlake Village, California
May 15, 2000
5
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SKINVISIBLE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
ASSETS
March 31
--------
2000 1999
---------------------
Current Assets
Cash $ 113,568 $ 149,550
Accounts Receivable 12,776 1,114
Inventory 144,968 66,218
Prepaid Expenses 18,225 -
Prepaid License Fees 50,000 50,000
---------- ---------
339,537 266,882
Total Current Assets
Property and Equipment
Furniture & Equipment 135,299 92,894
Laboratory Build-Out 314,633 234,837
---------- ---------
Total Property & Equipment 449,932 327,731
Less Accumulated Depreciation (72,233) (19,753)
---------- ---------
Net Property and Equipment 377,699 307,978
Other Assets
Exclusive Distributor Rights 200,000 200,000
Prepaid Royalties 1,000,000 1,000,000
--------- ---------
Total Other Assets 1,200,000 1,200,000
--------- ---------
Total Assets $1,917,236 1,774,860
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable
and Accrued Expenses $ 138,874 $ 289,382
Loan Payable - 45,000
---------- ---------
Total Current Liabilities 138,874 334,382
Stockholder's Equity
Common Stock, $0.001 par value
100,000,000 shares authorized
11,702,033 and 10,200,000 shares issued 11,702 10,200
Additional Paid in Capital 6,479,198 3,434,400
Accumulated Deficit (4,712,538) (2,004,122)
---------- ---------
Total Stockholder's Equity 1,778,362 1,440,478
---------- ---------
Total Liabilities and Stockholder's Equity $1,917,236 1,774,860
========== =========
See Notes to Consolidated Financial Statements
6
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SKINVISIBLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE THREE MONTHS ENDED MARCH 31, 2000
Three Months Ended March 31
---------------------------
2000 1999
---------------------------
Revenues $ 22,855 $ 33,910
Cost of Sales
Beginning Inventory 149,150 47,530
Purchases 8,581 30,065
------------ -----------
Total Available 157,731 77,595
Less: Ending Inventory (144,968) (66,218)
------------ -----------
Total Cost of Sales (12,763) (11,377)
------------ -----------
Gross Profit 10,092 22,533
Operating Expenses (572,539) (761,215)
------------ -----------
Loss Before Provision for Income Taxes (562,447) (738,682)
Provision for Income Taxes - -
Net Loss (562,447) (738,682)
Accumulated Deficit, Beginning of Period (4,150,091) (1,265,440)
------------ -----------
Accumulated Deficit, End of Period $(4,712,538) $(2,004,122)
============ ===========
Net Loss Per Share $ (0.05) $ (0.07)
------------ -----------
See Notes to Consolidated Financial Statements
7
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SKINVISIBLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Three Months Ended March 31
---------------------------
2000 1999
---------------------------
Shares of Common Stock Issued:
Beginning Balance 11,453,000 8,200,000
Issuance Pursuant to:
Stock Offering 206,000 1,500,000
Royalty Payment Agreement - 500,000
Stock Option Plan 37,333 -
Contract Settlements 5,700 -
------------ -----------
Ending Balance 11,702,033 10,200,000
============ ===========
Common Stock Par Value
Beginning Balance $ 11,453 $ 8,200
Issuance Pursuant to:
Stock Offering 206 1,500
Royalty Payment Agreement - 500
Stock Option Plan 37 -
Contract Settlements 6 -
------------ -----------
Ending Balance 11,702 10,200
------------ -----------
Additional Paid in Capital
Beginning Balance 5,983,747 936,400
Issuance Pursuant to:
Stock Offering 398,944 1,498,500
Royalty Payment Agreement - 999,500
Stock Option Plan 87,963 -
Contract Settlements 8,544 -
------------ -----------
Ending Balance 6,479,198 3,434,400
Accumulated Deficit
Beginning Balance (4,150,091) (1,265,440)
Net Loss (562,447) (738,682)
------------ -----------
Ending Balance (4,712,538) (2,004,122)
------------ -----------
Total Stockholders' Equity $ 1,778,362 $ 1,440,478
============ ===========
See Notes to Consolidated Financial Statements
8
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SKINVISIBLE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
Three Months Ended March 31
---------------------------
2000 1999
---------------------------
Cash Flows from Operating Activities
Net Loss $ (562,447) $ (738,682)
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities
Depreciation 12,675 10,895
(Increase) Decrease in:
Accounts Receivable (4,042) 3,301
Inventory 4,182 (18,688)
Advances (178) -
Other Asset - Prepaid Royalty - (1,000,000)
- Deposits 4,411 -
- Prepaid Expenses (18,225) -
(Increase) Decrease in:
Accounts Payable and Accrued
Expenses 36,179 165,659
------------ -----------
Net Cash Used by Operating
Activities (527,445) (1,577,515)
Cash Flows from Investing Activities:
Purchases of Property and Equipment (27,383) (203,711)
------------ -----------
Net Cash used by Investing Activities (27,383) (203,711)
Cash Flows from Financing Activities:
Payment of Loan Principal (725,762) (680,000)
Net Proceeds from the Issuance
of Common Stock 495,700 2,500,000
------------ -----------
Net Cash Provided by
Financing Activities (230,062) 1,820,000
------------ -----------
Net Increase (Decrease) in Cash (784,890) 38,774
Cash at End of Period 898,458 110,776
------------ -----------
------------ -----------
$ 113,568 $ 149,550
============ ===========
Supplemental Disclosure: Interest Paid $ 3,342 $ 15,104
See Notes to Consolidated Financial Statements
9
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SKINVISIBLE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ---------------------------------------------------
General
- -------
Skinvisible, Inc. (formerly Microbial Solutions, Inc.) was
incorporated on March 6, 1998 in the state of Nevada.
Skinvisible, Inc. immediately acquired 100% ownership of
Skinvisible Pharmaceuticals, Inc. (formerly Manloe Labs, Inc.)
also a Nevada corporation.
Skinvisible, Inc. and its subsidiaries, (collectively referred
to as the "Company" or "SKVI") develops and sells various
licensed anti-bacterial and anti-viral skin protectants to
numerous industries. The Company maintains manufacturing,
executive and sales offices at Las Vegas, Nevada.
Name Change
- -----------
On February 26, 1999, the Company completed the legal process of
changing its name from Microbial Solutions, Inc. to Skinvisible,
Inc. The subsidiaries name of Manloe Labs, Inc. was also
changed on February 26, 1999 to Skinvisible Pharmaceuticals,
Inc.
During 1999, the Company formed subsidiaries titled Skinvisible
International, Inc. and Skinvisible Pharmaceuticals (Canada),
Inc. On January 1, 2000 the company decided to discontinue
operations of its subsidiary, Skinvisible International, Inc.
Basis of Presentation
- ---------------------
The consolidated financial statements included the accounts of
Skinvisible, Inc. and it's subsidiaries, Skinvisible
Pharmaceuticals, Inc., and Skinvisible Pharmaceuticals (Canada),
Inc. All material intercompany balances have been eliminated.
The company reports revenue and expenses using the accrual
method of accounting for financial and tax reporting purposes.
All reported amounts are in U.S. dollars.
Use of Estimates
- ----------------
Management uses estimates and assumptions in preparing these
financial statements in accordance with generally accepted
accounting principles. Those estimates and assumptions affect
the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities, and the reported revenues
and expenses.
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SKINVISIBLE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Pro Forma Compensation Expense
- ------------------------------
SKVI accounts for costs of stock-based compensation in
accordance with APB No. 25, "Accounting for Stock Based
Compensation" instead of the fair value based method in SFAS No.
123. Stock options issued by SKVI carry exercise prices in
excess of prices that shares can currently be purchased for.
Accordingly, no pro forma compensation expense is reported in
these financial statements with the exception of the expense
recorded on the exercise of options on 37,333 shares during the
period ended March 31, 2000.
Inventories
- -----------
Inventory costs are accounted for on a first-in, first-out
basis. Inventory at any given time consists of raw materials,
products and packaging held for resale.
Property and Equipment
- ----------------------
Property and equipment are stated at historical cost.
Depreciation, Amortization and Capitalization
- ---------------------------------------------
The Company records depreciation and amortization using both
straight-line and declining balance methods over the estimated
useful life of the assets (five to seven years).
Expenditures for maintenance and repairs are charged to expense
as incurred. Additions, major renewals and replacements that
increase the property's useful life are capitalized. Property
sold or retired, together with the related accumulated
depreciation, is removed from the appropriate accounts and the
resultant gain or loss is included in net income.
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SKINVISIBLE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Income Taxes
- ------------
The company accounts for its income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes". Under Statement 109, a liability method is
used whereby deferred tax assets and liabilities are determined
based on temporary differences between basis used for financial
reporting and income tax reporting purposes. Income taxes are
provided based on tax rates in effect at the time such temporary
differences are expected to reverse. A valuation allowance is
provided for certain deferred tax assets if it is more likely
than not, that the Company will not realize the tax assets
through future operations.
Fair Value of Financial Instruments
- -----------------------------------
Financial Accounting Standards Statement No. 107, "Disclosures
About Fair Value of Financial Instruments", requires the Company
to disclose, when reasonably attainable, the fair market values
of its assets and liabilities which are deemed to be financial
instruments. The Company's financial instruments consist
primarily of cash and certain investments.
Per Share Information
- ---------------------
The Company computes per share information by dividing the net
loss for the period presented by the weighted average number of
shares outstanding during such period. The effect of common
stock equivalents would be antidilutive and is not included in
net loss per share calculations.
Recently Issued Accounting Pronouncements
- -----------------------------------------
Recently issued accounting pronouncements will have no
significant impact on the Company and its reporting methods.
Note 2 - PROVISION FOR INCOME TAXES
- -----------------------------------
The provision for income taxes for the periods ended March 31,
2000 and 1999 represents the minimum state income tax expense of
the Company, which is not considered significant.
Note 3 - LOAN PAYABLE
- ---------------------
During the quarter ended March 31, 1999 the Company had an
unsecured loan payable bearing an interest rate of 10% per
annum. During the current quarter, the Company used
approximately $725,000 to pay off loans that were outstanding as
of December 31, 1999. As of March 31, 2000, the company does
not have any outstanding loans payable.
12
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SKINVISIBLE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
Note 4 - COMMITMENTS AND CONTINGENCIES
- --------------------------------------
Operating Leases
- ----------------
The Company leases 8556 square of manufacturing and office space
under a noncancelable operating lease. This operating lease
terminates on April 14, 2002. In connection with the lease
arrangement, the Company is obligated to make rental payments of
$6464 per month with minimal annual increases of 3%.
Future annual minimum rental commitments are as follows:
Year
2000 $76,848
2001 $78,935
2002 $26,540
Litigation
- ----------
The Company is not presently involved in any litigation.
Licensing, Royalty and Consulting Agreements
- --------------------------------------------
The Company has currently entered into, and will continue to
enter into, product licensing, royalty and consulting agreements
that the Company's Board of Directors determine will enhance the
Company's ability to market innovative products in a competitive
field.
At March 31, 2000, the Company has future royalty payment
commitments totaling approximately $862,000.
Note 5 - STOCK OPTIONS
- ----------------------
During the period ended March 31, 2000 the Company issued stock
options with exercise prices ranging from $1.50 to $2.50 per
share, as incentives for employee and consultant performance.
Options on 1,266,167 shares of common stock were outstanding at
March 31, 2000. The exercise of any or all of these options
would cause reported losses per share to decrease.
13
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Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
GENERAL
Skinvisible, Inc. (the "Company") is in the business of
developing, manufacturing, licensing and selling anti-microbial
skin protection products and topical delivery technology
designed to form a skin barrier that provides persistent
activity against a broad spectrum of pathogens and aids in
reducing contact infection and cross-contamination. The
Company's products are also designed to promote healthy skin,
condition the hands and assist in reducing dryness, irritation
and chapping as well as Occupational Hand Disease. The Company
has completed the development of its products and has commenced
limited production and sales. The Company continues to
research and develop potential additional products.
In January, 2000 the Company's wholly owned subsidiary
Skinvisible Pharmaceuticals, Inc., filed a patent application
for its topical delivery technology.
Skinvisible Pharmaceuticals signed two new agreements dated
February 3, 2000 with British Columbia based network marketer,
Essentially Yours Industries Corp. ("EYI") that replaced
agreements signed in July 1999 with Essentially Yours and EYI
International Limited for product distribution. Under the new
agreements, EYI will purchase the Company's proprietary polymer
base composition and acquired a license to manufacture and sell
a private line of antimicrobial skin protector products
utilizing the Company's patent-pending topical delivery
technology. The terms of the license allows EYI to use the
Company's delivery technology in developing other products
beyond the antimicrobial skin protectant.
During the quarter ended March 31, 2000, the Company completed
clinical laboratory tests for a new antibacterial hand
sanitizer. This new product will be marketed under the name
Safe4Hours to commercial and retail outlets by the Company's
newly formed, wholly owned subsidiary, Safe4Hours, Inc. The
Company developed this new antibacterial hand sanitizer to meet
perceived market demand for a sanitizer that offers longer term
protection without drying out the skin. Most other products on
the market contain alcohol which dry skin and must be reapplied
after each hand washing. Safe4Hours is alcohol-free and has
persistent anti-microbial activity that can last for up to 4
hours regardless of repeated hand washing.
The Company's wholly owned subsidiary, Skinvisible
Pharmaceuticals (Canada), Inc., entered into an agreement dated
April 14, 2000 with Alberta-based Western Drug Distribution
Center Limited ("WDDC") whereby Skinvisible will sell its
Medical Formula anti-microbial skin care lotion to WDDC, who in
turn will retail the product to over 900 member and non-member
veterinarian clinics.
The Company received its Canadian import license on April 18,
2000.
RESULTS OF OPERATIONS
Net sales for the three months ended March 31, 2000 decreased to
$22,855 from $33,910 for the three months ended March 31, 1999.
This decrease in sales was due to the Company's change in
marketing focus at the start of the quarter. In 1999, the
Company's marketing efforts were
14
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focused around a network marking plan which was abandoned
recently in favor of a private label sales program.
As a result gross profit for the three months ended March 31,
2000 decreased to $10,092 or 44.2% of sales from $22,533 or
66.4% of sales for the three months ended March 31, 1999.
Management anticipates that sales will increase in future
quarters as re-directed marketing efforts become effective.
These re-directed marketing efforts are anticipated to include:
* the Company's offer to provide private label opportunities
to other companies;
* the Company's plan to license its proprietary polymers; and
* the commercial and retail sales of Safe4Hours.
The Company's operating expenses decreased to $572,539 for the
three months ended March 31, 2000 from $761,215 for the three
months ended March 31, 1999. This decrease in expenses was due
to management's change in marketing focus from network marketing
to private label sales.
The Company incurred marketing and selling expenses in the
amount of $160,331 for the three months ended March 31, 2000
compared with $326,264 for the three months ended March 31,
1999.
The Company incurred general and administrative costs in the
amount of $412,208 for the three months ended March 31, 2000
compared with $434,951 for the three months ended March 31,
1999.
Salaries and wages increased to $176,167 for the three months
ended March 31, 2000, compared with $157,059 for the three
months ended March 31, 1999. The increase of $19,108 in
salaries and wages reflects the difference in salaries of
personnel hired after the end of the first quarter 1999.
The Company anticipates that operating expenses will decrease
slightly in the next quarter due to the departure of one
employee that the Company does not plan to replace.
The Company's net loss decreased to $562,447 for the three
months ended March 31, 2000 compared to $738,682 for the three
months ended March 31, 1999. Overall this reduction of the net
loss was generally the result of the cost savings realized by
the Company's change in marketing focus.
LIQUIDITY AND CAPITAL RESOURCES
The Company's operations have been financed principally through
a combination of private sales of the Company's equity
securities and short-term loans.
The Company had cash of $113,568 as of March 31, 2000,
representing a decrease of $784,890 from cash as of December 31,
1999. During the quarter ended March 31, 2000, the Company used
$729,059 to pay off an unsecured loan. As of March 31, 2000,
the Company does not have any outstanding loans payable.
15
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The Company had accounts payable and accrued expenses in the
amount of $138,737 as of March 31, 2000, compared to $289,382 as
of March 31, 1999.
Cash used in operating activities for the three months ended
March 31, 2000 was $527,581 compared to $1,577,515 for the three
months ended March 31, 1999. This difference is primarily
attributable to a pre-payment on the Company's royalty agreement
to Bruce Jezior and Jazior Laboratory Group Inc. of 500,000
shares at a deemed price of $2 per share.
Cash used in investing activities for the three months ended
March 31, 2000 and 1999, was $27,383 and $203,711, respectively.
The Company anticipates that future issuances of its equity or
debt securities will be required in order for the Company to
continue to finance its operations as the Company's present
revenues are insufficient to meet operating expenses. The
Company anticipates spending approximately $1,125,000 over the
next nine month period in pursuing its plan of operations. Of
this amount, we anticipate that $562,500 will be realized from
operating revenues, after deduction of costs of goods sold, and
existing cash reserves, and $562,500 will be raised by
additional debt or equity financing.
The information contained in this section and elsewhere may at
times represent management's best estimates of the Company's
future financial and technological performance, based upon
assumptions believed to be reasonable. Management makes no
representation or warranty, however, as to the accuracy or
completeness of any of these assumptions, and nothing contained
in this document should be relied upon as a promise or
representation as to any future performance or events. The
Company's ability to accomplish these objectives, and whether or
not it will be financially successful is dependent upon numerous
factors, each of which could have a material effect on the
results obtained. Some of these factors are within the
discretion and control of management and others are beyond
management's control. Management considers the assumptions and
hypothesis used in preparing any forward-looking assessments of
profitability contained in this document to be reasonable;
however, we cannot assure investors that any projections or
assessments contained in this document, or otherwise made by
management, will be realized or achieved at any level.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
There are no legal proceedings pending or threatened against the
Corporation.
Item 2. Changes in Securities and Use of Proceeds
The Company issued a total of 249,033 shares of the Company's
common stock during the period from January 1, 2000 to March 31,
2000, the period covered by this report.
Of the shares issued, 206,000 were issued at a price of $2.25 to
a total of 6 accredited investors pursuant to Rule 506 of
Regulation D of the 1933 Act. The shares issued to the
investors were
16
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"restricted securities", as defined in the 1933
Act. The Company paid commissions to 3 parties in connection
with the shares issued to the investors.
The Company also issued 37,333 shares of common stock to 3
employees upon the exercise of their stock options granted
pursuant to the Company's incentive employee stock option plan.
These shares were issued at prices of $1.50 and $2.50 per share,
for a total purchase price of $88,000. These shares were
registered by the Company's form S-8 filing with the Securities
and Exchange Commission on December 15, 1999.
The Company issued 5,700 shares of common stock to a total of 57
eligible Independent Representatives of Skinvisible
International, Inc. as a contract settlement wherein the
Independent Representatives terminated and rescinded an
agreement between them and Skinvisible International, Inc.
These shares were marked "restricted" as issued.
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
Exhibit 10 - Agreement with WDDC
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K: A report on form 8-K was filed
on May 3, 2000 to announce the resignation of Director
Jerry Hodge.
17
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SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
SKINVISIBLE, INC.
Date: May 18, 2000 By: /s/ Terry Howlett
_________________________________
Terry Howlett
President
18
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Skinvisible
The Ultimate Choice in Skin Protection
April 11, 2000
Mr. Paul Morin
Controller/Assistant GM
Western Drug Distribution Center Limited
11445 - 163 Street
Edmonton, Alberta T5M 3Y3
Dear Paul:
Re: Letter Agreement between Skinvisible Pharmaceuticals
(Canada) Inc. ("Skinvisible") as Seller and Western
Drug Distribution Center Limited ("WDDC") as Purchaser
of Skinvisible Medical Formula Skin Care Protection /
Antiseptic Cleanser
--------------------------------------------------------
This letter is intended to set out the general terms and
conditions agreed upon between Skinvisible and WDDC for
Skinvisible to sell and for WDDC to purchase Skinvisible
Medical Formula Skin Care Protection / Antiseptic Cleanser
products.
1. WDDC will provide a signed Purchase Order to Skinvisible
for products it intends to purchase.
2. Product purchased by WDDC will be transferred from
Skinvisible's warehouse & distribution site to WDDC's
wholesale site and WDDC shall inform Skinvisible of any
such transfer on the same day it occurs.
3. Skinvisible will be set up as a supplier in WDDC's
distribution network and list the products that WDDC
intends to purchase in the WDDC Catalogue.
4. Skinvisible will sell its product to WDDC at its retail
list price less a 10.8% discount and WDDC will mark-up
such discounted product cost by 12% so it will be able to
compete at the same retail price in the marketplace.
5. WDDC will sell on a retail basis the Skinvisible products
to member and non-member veterinarians and clinics at the
stated retail price.
6. WDDC's terms of sale and related policies for member and
non-member veterinarians and clinics are published from
time to time in its Product Catalogue.
7. In addition to advertising and listing products in WDDC's
Catalogue, Skinvisible may access other marketing tools
that are available from WDDC (such as Fax Blast, Mailers,
Sample Distribution, and Newsletter) at costs outlined in
WDDC's rate card as published from time to time.
- ---------------------------------------------------------------
Skinvisible Pharmaceuticals, Inc.
6320 S. Sandhill Road, Suite #10 - Las Vegas, Nevada 89120
- Ph.: (702) 433-7154 / Fax: (702) 433-7192
Canadian Address: Suite 335, 1917 West 4th Avenue -
Vancouver, B.C. V6J 1M7 Ph: (604) 738-3243 / Fax: (604) 738-3246
<PAGE>
The above terms and conditions reflect discussions and
agreement between WDDC and
Skinvisible and shall form the basis of the Sale and
Purchase arrangement between
these parties.
We request that WDDC indicate its acknowledgement and
acceptance of this agreement
by signing and returning one copy of this letter in the
space indicated below. We look
forward to working with WDDC and to a mutually successful
business relationship.
Yours truly,
/s/ Cheryl J. Claeys
Cheryl J. Claeys
Manager Corporate Development
ACKNOWLEDGED AND ACCEPTED THIS ____14____DAY OF April, 2000.
Western Drug Distribution Center Limited
/s/ Greg Hall
Per: ________________________________
- ---------------------------------------------------------------
Skinvisible Pharmaceuticals, Inc.
6320 S. Sandhill Road, Suite #10 - Las Vegas, Nevada 89120
- Ph.: (702) 433-7154 / Fax: (702) 433-7192
Canadian Address: Suite 335, 1917 West 4th Avenue -
Vancouver, B.C. V6J 1M7 Ph: (604) 738-3243 / Fax: (604) 738-3246
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<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS CONTAINED IN
THE COMPANY'S QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED
MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 114
<SECURITIES> 0
<RECEIVABLES> 13
<ALLOWANCES> 0
<INVENTORY> 145
<CURRENT-ASSETS> 340
<PP&E> 450
<DEPRECIATION> (72)
<TOTAL-ASSETS> 1917
<CURRENT-LIABILITIES> 139
<BONDS> 0
0
0
<COMMON> 12
<OTHER-SE> 1766
<TOTAL-LIABILITY-AND-EQUITY> 1917
<SALES> 23
<TOTAL-REVENUES> 23
<CGS> 13
<TOTAL-COSTS> 13
<OTHER-EXPENSES> 572
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (562)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (562)
<EPS-BASIC> (0.05)
<EPS-DILUTED> (0.05)
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