U.S. 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
------------------------
Commission File Number: 000-26555
------------------------
ACCUIMAGE DIAGNOSTICS CORP.
(Name of Small Business Issuer in its Charter)
Nevada 33-0713615
- ---------------------------- -------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
400 Oyster Point Blvd., Suite 114, South San Francisco, California 94080-1917
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (650) 875-0192
- -------------------------------------------------------------------------------
Indicate by check mark whether the registrant has (1) filed all reports required
to be filed by Section 13 or 15(d) of the Securities Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to filing requirements within
the past 90 days.
Yes _X_ No ___
The number of shares outstanding of the issuer's common stock was 10,714,867
shares of common stock, par value $.001, as of May 10, 2000. No shares of
preferred stock are outstanding.
Transitional Small Business Disclosure Format:
Yes___ No _X_
================================================================================
<PAGE>
ACCUIMAGE DIAGNOSTICS CORP.
Form 10-QSB
March 31, 2000
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements 3
Balance Sheets as of March 31, 2000 (unaudited) and September 30, 1999 3
Statements of Operations (unaudited) for the Three and Six Months
Ended March 31, 2000 and 1999 4
Statements of Cash Flow (unaudited) for the Three Months
Ended March 31, 2000 and 1999 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of
Financial Condition or Plan of Operations 7
PART II. OTHER INFORMATION
Item 2. Changes in Securities 10
Item 6. Exhibits and Reports on Form 8-K 10
Signature 10
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ACCUIMAGE DIAGNOSTICS CORP.
BALANCE SHEETS
MARCH 31, 2000 (UNAUDITED) AND SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
<S> <C> <C>
ASSETS March 31, 2000 September 30, 1999
Current Assets -------------- ------------------
(UNAUDITED)
Cash $ 701,470 $ 34,201
Accounts Receivable 467,786 188,744
Less Allowance for Doubtful accounts (16,619) (16,619)
Other receivable - 31,274
Inventory 143,000 44,957
Prepaid Insurance - 745
Prepaid Rent 3,845 3,744
Licenses For Resale 16,370 16,370
---------------------------
Total Current Assets 1,315,852 303,416
Property and Equipment 52,470 61,351
Other Assets
Security Deposits 3,820 3,820
Deposits & License Fees 125,716 125,716
License TECH 5,200 5,200
License Fee NECTEC 10,000 10,000
Less Accumulated Amortization (88,537) (80,700)
Goodwill 618,140 618,140
Acc. Amort-Goodwill (154,541) (123,633)
-----------------------------
Total Other Assets 519,799 558,543
TOTAL ASSETS $1,888,120 $923,310
=============================
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, 2000 September 30, 1999
Current Liabilities -------------- ------------------
Accounts Payable $ 141,537 $ 146,376
Product Warranty Reserve 191,538 84,270
Sales Tax Payable 10,838 4,190
Wages & Payroll taxes Payable 22,946 71,464
Other Accrued Expenses 5,732 5,332
Notes Payable-related party 52,000 56,500
--------------------------------
Total Current Liabilities 424,591 368,132
Stockholders' Equity
Preferred Shares - $0.001 Par Value; 10,000,000 - -
shares Authorized; None issued or outstanding
Common Shares - $0.001 Par Value; 50,000,000 9,748 9,748
Authorized; 10,696,867 shares & 9,748,200 shares
issued and outstanding on March 31, 2000
and September 30, 1999 respectively
Common Stock Subscriptions 949 -
Paid-In-Capital 2,305,713 1,740,662
Accumulated Earnings (Deficit) (852,881) (1,195,232)
--------------------------------
Total Stockholders's Equity 1,463,529 555,178
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $1,888,120 $923,310
================================
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
ACCUIMAGE DIAGNOSTICS CORP
STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE AND SIX MONTHS ENDED MARCH 31, 2000 AND 1999
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
For the three months For six months
Ended March 31, Ended March 31,
--------------- ---------------
2000 1999 2000 1999
---- ---- ---- ----
TOTAL REVENUES $802,341 $ 256,866 $ 1,677,802 $ 462,713
COST OF GOODS SOLD 73,826 55,990 560,485 93,752
---------------------------------------------------------
GROSS PROFIT 728,515 200,876 1,117,317 368,961
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES 432,957 272,705 778,613 507,451
----------------------------------------------------------
OPERATING INCOME (LOSS) 295,558 (71,829) 338,704 (138,490)
-------------------------------------------------------------
OTHER INCOME AND EXPENSES
Interest Income (2,893) (1,032) (3,847.36) (1,540)
Other Income - (3,600) (200.00) (3,602)
Franchise and Other Taxes 400 400
--------------------------------------------------------------
TOTAL OTHER INCOME AND EXPENSES (2,493) (4,632) (3,647) (5,142)
---------------------------------------------------------------
NET INCOME (LOSS) $ 298,051 $ (67,197) $ 342,351 $ (133,348)
================================================================
INCOME(LOSS) PER SHARE-BASIC $0.0303 ($0.0070) $0.0304 ($0.0071)
INCOME(LOSS) PER SHARE-DILUTED $0.0289 ($0.0068) $0.0290 ($0.0069)
Weighted Average Shares Outstanding
Basic 9,832,074 9,592,878 9,790,137 9,461,072
Diluted 10,328,228 9,821,743 10,286,291 9,689,937
</TABLE>
<PAGE>
ACCUIMAGE DIAGNOSTICS CORP
STATEMENTS OF CASH FLOW (UNAUDITED)
FOR THE PERIOD OCTOBER 1, 1999 TO MARCH 31, 2000
and THE PERIOD FROM OCTOBER 1, 1998 TO MARCH 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C> <C>
March 31, March 31
2000 1999
-------- --------
Cash Flows from Operating Activities
Net Cash used by Operating Activities: $ 105,769 $(171,208)
--------------------------------
Cash Flow from Investing Activities:
investment in Property and Equipment
I - 6,510
---------------------------------
Net Cash Provided (Used) by
Investing Activities - 6,510
---------------------------------
Cash Flow From Financing Activities:
Proceeds from Short-Term Debt - -
Repayment of Short-Term Debt (4,500) (50,000)
Proceeds from sales of Stock 566,000 383,500
---------------------------------
Net Cash Provided (Used) by Financing
Activities 561,500 333,500
------------------------------
Increase (Decrease) in Cash 667,269 168,802
34,201 2,117
Cash Balance at beginning of period ---------------------------------
Cash balance at end of period $701,470 $170,919
==================================
Supplemental Disclosure:
Interest Pai $0 $0
Income Taxes $0 $0
Compensation paid in shares (Non-Cash) $0 $134,410
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
NOTES TO THE FINANCIAL STATEMENTS
(1) Basis of Presentation
In the opinion of the management the accompanying consolidated financial
statements contain all adjustments necessary (consisting of only normal
recurring accruals) to present fairly the financial position at March 31, 2000,
the results of its operations for the three months ended March 31, 2000 and the
cash flow for three months and six months ended December 31,1999. Certain
information and footnote disclosures normally included in financial statements
that would have been prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the rules and regulations
of the Securities and Exchange Commission, although management of the Company
believes that the disclosures in these financial statements are adequate to make
the information presented therein not misleading. It is suggested that these
condensed financial statements and notes thereto be read in conjunction with the
financial statements and the notes thereto included in the Company's September
30, 1999 Form 10-KSB. The results of operations for the three months and six
months ended March 31, 2000 are not necessarily indicative of the results of
operations to be expected for the full fiscal year ending September 30, 2000.
(2) Interim Period Cost of Goods Sold
Interim period cost of goods sold is calculated using the perpetual
inventory record. The Company reports any significant adjustments that result
from reconciliations of the perpetual inventory record to periodic and annual
physical inventory observations.
(3) Income Taxes
Significant components of the provision for taxes based on income for the
three months ended March 31, 2000 and 1999 are as follows:
1999 1998
------- --------
Current tax expense
Federal $ 0 $ 0
State 400 400
------- ---------
400 400
Deferred tax expense
Federal 0 0
State 0 0
-------- ---------
Provision for income taxes $ 400 $ 400
====== ======
At September 30, 1999, the Company has approximately $1,532,737 net
operating loss carryforwards available to offset future federal and state income
taxes, which expire through 2010 and 2019.
The Company has elected to fully reserve all tax benefits until such time
as it is able to reasonably expect to realize those benefits.
The accompanying notes are an integral part of these financial statements
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition or
Plan of Operations
The following discussion and analysis should be read in conjunction with
the Company's Consolidated Financial Statements and related Notes thereto
contained elsewhere with this document. Operating results for the three-month
period ended March 31, 2000 are not necessarily indicative of the results that
may be expected for any future periods, including the full fiscal year.
Reference should also be made to the Annual Financial Statements, Notes thereto,
and Management's Discussion and Analysis of Financial Condition and Results of
Operations contained in the Company's Form 10-KSB, filed on March 17, 2000, and
the Company's Form 10-QSB, filed on March 23, 2000.
AccuImage is engaged in the development, marketing and support of software
for the visualization, analysis and management of medical imaging data. The
software's primary function is to enhance physicians' interpretation of data
from medical imaging modalities such as computed tomography, magnetic resonance
and ultrasound through the application of three-dimensional computer graphics
and image processing technologies. This enhanced analysis can support physicians
in clinical diagnosis, surgical planning and medical research. Three-dimensional
visualization allows communication of findings in a form readily understood by
physicians and others without the specialized training otherwise required to
interpret the native images generated by the medical imaging modalities.
Efficiency gains and cost savings may be realized through automated reporting
tools and provision for electronic distribution of the medical imaging data and
post-processed results via internal networks and the Internet.
Revenue
For the three months ended March 31, 2000, revenue increased 312% to
$802,341 compared with $256,866 in 1998. This increase was almost entirely the
result of increased sales of the Company's medical visualization and analysis
was completed prior to the first quarter of fiscal year 2000, and the second
quarter results reported here are entirely related to sales of the Company's own
software. During 1999, the Company successfully transitioned from distributing
software developed by a third party and licensed to the Company to distributing
its own software that was developed in-house. This transition
Gross Margin
The gross margin percentage for the quarter was 90% compared to 78% for the
same period in 2000. This increase in gross margin is largely due to a reduced
cost of goods sold now that the Company is distributing its own software
product, rather than having to pay a licensing fee for each sale to a third
party. Furthermore, the improvement over the first quarter is influenced by the
fact that Imatron's contractual right to order numerous systems at cost is no
longer in effect. During the first quarter, Imatron exercised its right to
purchase numerous systems with full software licenses for a price equal to the
cost of the underlying hardware plus ten percent. Furthermore, several
demonstration systems were sold to Imatron under similar terms. These
transactions resulted in a reduced gross margin for Q1, but no such activity
occurred during Q2. Hence the Q2 gross margin is greatly improved over the Q1
result.
Sales and Marketing
The Company's sales and marketing expenses for the quarter were $67,729
which compare with approximately $110,000 for the entire prior fiscal year 1999.
The increase reflects the cost of increased sales and marketing activity. The
Company expects sales and marketing costs to continue to increase as additional
sales personnel are recruited and sales commissions increase, although this
forward looking statement will be influenced by the actual sales levels attained
by the Company's sales force.
Research and Development
The Company spent $61,115 on research and development activities during the
quarter, which compares with approximately $75,000 for the same quarter in the
prior fiscal year. The Company anticipates that software development costs will
increase as the Company proceeds with recruitment of further software
development expertise. The Company does not intend on reducing its research and
development effort since maintenance of a competitive position in the
marketplace in which the Company operates requires constant improvement and
high-level development of the Company's software products.
Operational and Administrative
Operational and administrative expenses were $240,813 for the quarter,
which compares with an estimated $181,250 for the same quarter in the previous
year. The increase reflects the increased operational capability of the Company
which has developed over the interim period, motivated by increased sales
activity and hence operational, manufacturing and support requirements. The
Company believes that operational and administrative costs will increase in
future if the Company is successful in its efforts to recruit new staff and
develop its capabilities in these areas. As a result of becoming a reporting
company pursuant to the Securities Exchange Act of 1934, the Company will likely
increase its expenditures on investor relations and legal and financial
expertise.
Results of Operations
Despite the increased expenses for sales, marketing, operations and
administration, the Company's increased revenues resulted in an operating profit
of $295,558 in the second quarter of fiscal year 2000. In 1999 and 1998, the
Company experienced operating losses of $460,938 and $626,778, respectively.
Liquidity and Capital Resources
In the quarter ending March 31, 2000, the Company generated an operating
profit of $295,558 and secured financing through the sale of stock in the amount
of $566,000. The Company repaid one note payable in the amount of $4,500, and as
a result holds $51,500 in notes payable, held since September 1998. On March 31,
2000, the Company had $701,470 in cash, and accounts receivable of $467,786.
Accounts payable totaled $141,537.
The Company anticipates that cash requirements for the remainder of the
year will be met by a combination of existing cash on hand, further operational
income and additional equity financing. To this end, the Company has secured
further commitments from a group of investors to obtain enough additional
capital to ensure that it will have sufficient resources to achieve its
strategic objectives for the fiscal year ended September 30, 2000. However there
can be no guarantee that such further income and financing will finally be
forthcoming and the inability of the Company to secure such capital could have a
material adverse effect on the Company's business.
Foreign Currency Transactions
All the Company's transactions are negotiated, invoiced and paid in U.S.
dollars.
Inflation
Management believes the Company's operations and financial condition have
suffered no adverse material effect due to inflation.
Share Price Volatility
During the second quarter of fiscal year 2000, the Company's share price
experienced relative stability and some moderate growth towards the end of the
period. The trading price of the Company's common stock could be subject to wide
fluctuations in response to quarter-to-quarter variations in operating results,
changes in earnings estimates by analysts, announcements of technological
innovations or new products by the Company or its competitors, general
conditions in the software and computer industries and other events or factors.
In addition, in recent years the stock market in general, and the shares of
technology companies in particular, have experienced extreme price fluctuations.
This volatility has had a substantial effect on the market price of securities
issued by many companies for reasons unrelated to the operating performance of
the specific companies. These broad market fluctuations may adversely affect the
market price of the common stock.
Year 2000 Impact.
The year 2000 computer problem refers to the potential for system and
processing failures of date-related data as a result of computer-controlled
systems using two digits rather than four to define the applicable year. For
example, computer programs that have time-sensitive software may recognize a
date represented as "00" as the year 1900 rather than the year 2000. This could
result in a system failure or miscalculations causing disruptions with internal
administrative and operational software, software developed by the Company,
software integrated in the Company's products, and third-party systems to which
the Company's products interface.
With regard to internal use of software products, the Company inspected
financial and accounting software vendors whose products are in use by the
Company and reached a level of reasonable assurance that the software packages
used by the Company would behave correctly after the onset of year 2000.
With regard to software developed by the Company, the software development
team adopted procedures to avoid potential issues and conducted "roll-forward"
testing of the Company's products. Minor issues that arose during this testing
were corrected far in advance of year 2000.
With regard to software integrated into the Company's products, the Company
took steps to determine what measures in terms of software upgrades and fixes
needed to be taken in order to render all integrated software products year 2000
compliant and adopted the appropriate versions as part of its integration
procedure. The Company's installed base was similarly updated.
With regard to third-party systems to which the Company's products
interface, the Company conducted a survey of the information transferred to its
products from such third-party systems in collaboration with the manufacturers
of these systems and modified its software in order to render them year 2000
compliant.
To date, the Company has not experienced any year 2000 issues with any of
its internal systems or products, and it does not expect to experience any in
the future. Additionally, it has not experienced any year 2000 issues related to
any of its key third party suppliers, distributors and customers nor does it
expect to experience any in the future. Costs associated with remediating the
Company's internal systems and software were not material.
Forward-looking Statements
The discussion contained in this Management Discussion & Analysis is
"forward looking" as that term is contemplated by Section 27A of the Securities
Act of 1933 and Section 12E of the Securities exchange Act of 1934, including,
without limitation, statements regarding the Company's expectations, beliefs,
intentions or strategies regarding future business operations and projected
earnings from its products and services, which are subject to many risks.
All forward-looking statements included in this document are based on
information available to the Company on the date hereof, and the Company assumes
no obligation to update any such forward-looking statements. The Company's
actual results may differ materially as a result of certain factors, including
those set forth hereafter and elsewhere in this Form 10-QSB. Potential investors
should consider carefully the previously stated factors, as well as the more
detailed information contained elsewhere in this Form 10-QSB, before making a
decision to invest in the common stock of the Company.
<PAGE>
PART II - OTHER INFORMATION
Item 2. Changes In Securities
On January 25, 2000 the Company commenced a private placement offering of
up to 1,285,000 Units consisting of one share of common stock and one common
stock purchase warrant at $0.60 per Unit. As of March 31, 2000, the Company had
received subscriptions to purchase 916,667 Units from three purchasers but had
not yet issued the shares and warrants. Additionally, the Company will pay a
finder's fee in the form of 50,000 shares of restricted common stock to Inyoung
Boyd, wife of Douglas P. Boyd, Chairman of the Board of the Company, for
services rendered in connection with the placement of the Units. The issuance of
the securities is exempt from the registration requirements of the Securities
Act of 1933, as amended, pursuant to Section 4(2) thereof.
Item 6 Exhibits And Reports On Form 8-K
(a) Exhibits:
No. 4.1 - Form of Warrant issued to investors in Private
Offering concluded April 30, 2000.
No. 10.1 - Form of Unit Purchase Agreement between the Company
and investors in the Private Offering which concluded April
30, 2000.
No. 27 - Financial Data Schedule as of March 31, 2000.
(b) Form 8-K Reports: None.
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
ACCUIMAGE DIAGNOSTICS CORP.
May 15, 2000
By: /s/ Robert Taylor
---------------------------------
Robert Taylor, Ph.D.
Chief Executive Officer
<PAGE>
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY SALE, TRANSFER,
PLEDGE OR OTHER DISPOSITION THEREOF MAY BE MADE ONLY (I) IN A REGISTRATION UNDER
SAID ACT OR (II) IF AN EXEMPTION FROM REGISTRATION UNDER SAID ACT IS AVAILABLE
AND THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL TO THAT EFFECT REASONABLY
SATISFACTORY TO IT.
ACCUIMAGE DIAGNOSTICS CORP.
COMMON STOCK PURCHASE WARRANT
This Warrant Expires March, 2005
Warrant No. 00- Shares:_______
THIS CERTIFIES that, subject to the terms and conditions herein set forth,
________________ (the "Holder") is entitled to purchase from ACCUIMAGE
DIAGNOSTICS CORP., a Nevada corporation (the "Company"), at any time or from
time to time during the Exercise Period (as hereinafter defined) the number of
shares of fully paid and non--assessable shares of Common Stock of the Company
(the "Shares") as provided herein upon surrender hereof at the principal office
of the Company, and, at the election of the holder hereof, upon payment of the
purchase price at said office in cash or by cashier's check or by the wire
transfer of funds in a dollar amount equal to the purchase price of the Shares
for which the consideration is being given.
1. Purchase Price. Subject to adjustment as hereinafter provided, the
purchase price of one share of -------------- Common Stock (or such securities
as may be substituted for one share of Common Stock pursuant to the provisions
hereinafter set forth) (the "Warrant Price") shall be One Dollar and Fifty Cents
($1.50).
2. Adjustment of Warrant Price and Number of Shares. The number and kind of
securities issuable upon the exercise of this Warrant shall be subject to
adjustment from time to time upon the happening of certain events as follows:
(a) Adjustment for Dividends in Stock. In case at any time or from
time to time on or after the Closing Date of the Company's unit offering as set
forth in the Supplemental Term Sheet dated March 21, 2000 relating to the
Company's offering of 1,283,334 of its Units (the "Unit Offering"), the holders
of the Common Stock of the Company (or any shares of stock or other securities
at the time receivable upon the exercise of this Warrant) shall have received,
or, on or after the record date fixed for the determination of eligible
stockholders, shall have become entitled to receive, without payment therefor,
other or additional stock of the Company by way of dividend (other than as
provided for in Paragraph 2(b) below), then and in each such case, the holder of
this Warrant shall, upon the exercise hereof, be entitled to receive, in
addition to the number of shares of Common Stock receivable thereupon, and
without payment of any additional consideration therefor, the amount of such
other or additional stock of the Company which such holder would hold on the
date of such exercise had it been the holder of record of such Common Stock on
the date hereof and had thereafter, during the period from the date hereof to
and including the date of such exercise, retained such shares and/or all other
additional stock receivable by it as aforesaid during such period, given effect
to all adjustments called for during such period by this Paragraph 2.
(b) Adjustment for Changes in Common Stock. In the event of changes in
the outstanding Common Stock of the Company by reason of split-ups,
recapitalizations, reclassifications, mergers, consolidations, combinations or
exchanges of shares, separations, reorganizations, liquidations, or the like,
occurring after the Closing Date of the Unit Offering, the number and class of
shares available under the Warrant in the aggregate and the Warrant Price shall
be correspondingly adjusted by the Board of Directors of the Company. The
adjustment shall be such as will give the holder of the Warrant on exercise for
the same aggregate Warrant Price the total number, class, and kind of shares as
he would have owned had the Warrant been exercised prior to the event and had he
continued to hold such shares until after the event requiring adjustment.
3. No Fractional Shares. No fractional shares of Common Stock will be
issued in connection with any subscription hereunder. In lieu of any fractional
shares which would otherwise be issuable, the Company shall pay cash equal to
the product of such fraction multiplied by the fair market value of one share of
Common Stock on the date of exercise, as determined by the fair market value of
one share of the Company's Common Stock on the date of exercise as determined in
good faith by the Company's Board of Directors.
4. No Stockholder Rights. This Warrant shall not entitle its holder to any
of the rights of a stockholder of the Company prior to exercise thereof.
5. Redemption. The Company shall have the right, upon the giving of at
least 30 days' prior written notice to the holders of all the Warrants, to
redeem all of the Warrants at a price of $0.01 per Warrant (the "Redemption
Price") commencing one year from the Closing Date of the Unit Offering, provided
that the average closing bid price per share of the Common Stock, for 20
consecutive trading days, ending not more than 15 calendar days prior to the
date of the redemption notice, equals or exceeds at least 200% of the then
effective exercise price of the Warrants. All Warrants issued in the Unit
Offering must be redeemed if any are to be redeemed.
Such notices of redemption shall (a) designate the date of redemption which
date shall not be less than 30 or more than 60 days from the date of such
notice, (b) state the Redemption Price and that payment therefor will be made
upon surrender of the Warrant at the offices of the Company and (c) indicate
that the right to exercise the Warrant will terminate at the close of business
on the business day prior to the redemption date. If the giving of notice of
redemption shall be given as aforesaid, the right to exercise the Warrant will
terminate at the close of business on the business day prior to the redemption
date, and the holder of this Warrant shall thereafter be entitled upon surrender
of this Warrant only to receive the Redemption Price without interest.
6. Reservation of Stock. The Company covenants that during the period this
Warrant is exercisable, the Company will reserve from its authorized and
unissued Common Stock a sufficient number of shares to provide for the issuance
of Common Stock upon the exercise of this Warrant. The Company agrees that its
issuance of this Warrant shall constitute full authority to its officers who are
charged with the duty of executing stock certificates to execute and issue the
necessary certificates for shares of Common Stock upon the exercise of this
Warrant.
7. Exercise of Warrant. This Warrant may be exercised by the registered
holder or its registered assigns, in whole or in part and in minimum units of
10,000 shares, by the surrender of this Warrant at the principal office of the
Company, together with the form of subscription hereof duly executed,
accompanied by payment in full of the amount of the Warrant Price in the form
described in this Warrant. Upon partial exercise hereof, a new warrant or
warrants containing the same date and provisions as this Warrant shall be issued
by the Company to the registered holder for the number of shares of Common Stock
with respect to which this Warrant shall not have been exercised. A Warrant
shall be deemed to have been exercised immediately prior to the close of
business on the date of its surrender for exercise as provided above, and the
person entitled to receive the shares of Common Stock issuable upon such
exercise shall be treated for all purposes as the holder of such shares of
record as of the close of business on such date. As promptly as practicable on
or after such date, the Company shall issue and deliver to the person or persons
entitled to receive the same, a certificate or certificates for the number of
full shares of Common Stock issuable upon such exercise, together with cash in
lieu of any fraction of a share as provided above.
8. Certificate of Adjustment. Whenever the Warrant Price is adjusted as
herein provided, the Company shall promptly deliver to the record holder of this
Warrant a certificate of an officer of the Company setting forth the relevant
Warrant Price or number of shares after such adjustment and setting forth a
brief statement of the facts requiring such adjustment.
9. Compliance With Securities Act. The holder of this Warrant, by
acceptance hereof, agrees that this Warrant and the shares of Common Stock to be
issued upon exercise hereof (or shares of any security into which such Common
Stock may be converted) are being acquired for investment and that the holder
will not offer, sell, or otherwise dispose of this Warrant and any shares of
Common Stock to be issued upon exercise hereof (or shares of any security into
which such Common Stock may be converted) except under circumstances which will
not result in a violation of the Securities Act of 1933, as amended (the
"Securities Act"). Upon exercise of this Warrant, the holder hereof shall, if
requested by the Company, confirm in writing its investment purpose and
acceptance of the restrictions on transfer of the shares of Common Stock.
10. Subdivision of Warrant. At the request of the holder of this Warrant in
connection with a transfer or exercise of a portion of the Warrant, upon
surrender of such Warrant for such purpose to the Company, the Company at its
expense (except for any transfer tax payable) will issue and exchange therefor
warrants of like tenor and date representing in the aggregate the right to
purchase such number of shares of such Common Stock as shall be designated by
such holder at the time of such surrender; provided, however, that the Company's
obligations to subdivide securities under this section shall be subject to and
conditioned upon the compliance of any such subdivision with applicable state
securities laws and with the Securities Act.
11. Loss, Theft, Destruction, or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction, or mutilation of this Warrant, and in case of loss, theft, or
destruction, of indemnity or security reasonably satisfactory to it, and upon
reimbursement to the Company of all reasonable expenses incidental thereto, and
upon surrender and cancellation of this Warrant, if mutilated, the Company will
make and deliver a new Warrant of like tenor and dates as of such cancellation,
in lieu of this Warrant.
12. Miscellaneous. This Warrant shall be governed by the laws of the State
of California. The headings in this Warrant are for purposes of convenience and
reference only, and shall not be deemed to constitute a part hereof. Neither
this Warrant nor any term hereof may be changed, waived, discharged, or
terminated orally but only by an instrument in writing signed by the Company and
the registered holder hereof. All notices and other communications from the
Company to the holder of this Warrant shall be by telecopy or expedited courier
service to the address furnished to the Company in writing by the last holder of
this Warrant who shall have furnished an address to the Company in writing.
13. Exercise Period. The Exercise Period shall mean the period commencing
on the date hereof and ending on March __, 2005.
ISSUED this ___day of March, 2000.
ACCUIMAGE DIAGNOSTICS CORP.
By:
------------------------------------
Robert Taylor, Chief Executive Officer
ATTEST:
- ---------------------------------
<PAGE>
FORM OF ASSIGNMENT
ACCUIMAGE DIAGNOSTICS CORP.
FOR VALUE RECEIVED the undersigned registered owner of this warrant hereby
sells, assigns, and transfers unto the Assignee named below all of the rights of
the undersigned under the within Warrant, with respect to the number of shares
of Common Stock set forth below.
Name of Assignee Address Number of Shares
and does hereby irrevocably constitute and appoint
________________________________ Attorney to make such transfer on the books of
ACCUIMAGE DIAGNOSTICS CORP. maintained for the purpose, with full power of
substitution in the premises.
Dated:
----------------------
------------------------------------------
Name of Warrant Holder
Signature:
-------------------------------
Witness:
---------------------
<PAGE>
SUBSCRIPTION FORM
ACCUIMAGE DIAGNOSTICS CORP.
(To be executed only upon exercise of Warrant)
The undersigned registered owner of this Warrant irrevocably exercises this
Warrant for and purchases ________________ of the number of shares of Common
Stock of ACCUIMAGE DIAGNOSTICS CORP. purchasable with this Warrant, and herewith
makes payment therefor, all at the price and on the terms and conditions
specified in this Warrant.
Dated:
------------------------
------------------------------------------
(Signature of Registered Owner)
------------------------------------------
(Street Address)
------------------------------------------
(City) (State) (Zip Code)
UNIT PURCHASE AGREEMENT
THIS UNIT PURCHASE AGREEMENT is made as of the date set forth on the
signature page attached hereto (the "Signature Page") between ACCUIMAGE
DIAGNOSTICS CORP., a Nevada corporation (the "Company"), and the person whose
name and address appear on the Signature Page to this Agreement (the
"Purchaser"):
RECITALS:
WHEREAS, the Company has authorized an offering of 1,283,334 Units at $0.60
per Unit (the "Offering"), each Unit consisting of one share of the Company's
Common Stock (the "Common Stock") and a warrant (the "Warrants") to purchase one
share of Common Stock at an exercise price of $1.50 per share at any time during
a five year term commencing on the date of issuance (the Units, the Common Stock
and the Warrants comprising the Units, and the shares of Common Stock issuable
upon exercise of the Warrants are hereinafter collectively referred to as the
"Securities"); and
WHEREAS, the Purchaser desires to purchase and the Company desires to sell
the Units on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of these premises and the mutual covenants
and agreements herein contained and other valuable consideration, the receipt
and adequacy of which the parties hereto acknowledge, the parties agree as
follows:
1. Purchase and Sale of the Units. Subject to the terms and conditions of
this Agreement, Purchaser agrees to purchase at the Closing, and the Company
agrees to sell and issue to the Purchaser at the Closing, against cash payment,
that number of Units set forth below the Purchaser's name on the Signature Page
to this Agreement at a purchase price of $0.60 per Unit.
2. Closing Date; Delivery. The purchase and sale of the Units shall be held
at the offices of the Company, 400 Oyster Point Blvd., South San Francisco,
California 94080, and may occur at successive closings, the last of which shall
be March 31, 2000, or at such other times and places as the parties may agree
upon (collectively, the "Closing"). At the Closing, subject to the terms of this
Agreement, the Company will deliver to the Purchaser a certificate representing
the number of Units to be purchased by the Purchaser from the Company, against
payment at the Closing of the cash purchase price.
3. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the Purchaser that:
(a) Organization and Standing; Articles and Bylaws. The Company is a
corporation duly organized and existing under, and by virtue of, the laws of the
State of Nevada and is in good standing under such laws. The Company has the
requisite corporate power to own and operate its properties and assets and to
carry on it business as presently conducted and as proposed to be conducted. The
Company is qualified or licensed as a foreign corporation in all jurisdictions
where the nature of its activities or of its properties owned or leased makes
such qualification or licensing necessary.
(b) Corporate Power. The Company has now all requisite legal and
corporate power to enter into this Agreement, to sell the Securities hereunder,
and to carry out and perform its obligations under the terms of this Agreement.
(c) Capitalization. The authorized capital stock of the Company
consists of 10,000,000 Preferred Shares, $0.001 par value, none of which are
outstanding, and 50,000,000 Common Shares, $0.001 par value, of which 9,748,200
are issued and outstanding. The issued and outstanding shares of Common Stock
have been duly authorized and validly issued, are fully paid and nonassessable.
There are currently 930,000 outstanding warrants to purchase Common Stock. There
are no other outstanding rights, options, warrants, conversion rights, or
agreements for the purchase or acquisition from the Company of any shares of its
capital stock other than 2,100,000 shares of Common Stock reserved under the
Company's option plan.
(d) Authorization.
(i) All corporate action on the part of the Company, its
officers, directors, and stockholders necessary for the sale and issuance of the
Securities pursuant hereto and the performance of the Company's obligations
hereunder, has been taken or will be taken prior to the Closing. This Agreement
is a legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws of general application
affecting enforcement of creditors' rights, and except as limited by application
of legal principles affecting the availability of equitable remedies.
(ii) The Securities, when issued in compliance with the
provisions of this Agreement, will be validly issued, fully paid and
nonassessable, and will be free of any liens or encumbrances; provided, however,
that such Securities may be subject to restrictions on transfer under state
and/or federal securities laws as set forth herein and as may be required by
future changes in such laws.
(iii) No shareholder of the Company has any right of first
refusal or any preemptive rights in connection with the issuance of the
Securities by the Company.
(e) Financial Statements. The Company's (a) audited balance sheet for
the fiscal years ended September 30, 1999 and 1998 and statements of operations,
cash flow, and stockholders' equity for the fiscal years ended September 30,
1997, 1998, and 1999 together with the report by Berg & Company, Certified
Public Accountants, thereon and the notes thereto and (b) unaudited balance
sheet as of December 31, 1999 and statements of operations, cash flow, and
stockholders' equity for the three months ended December 31, 1999 and 1998, and
notes thereto, which have been supplied to the Purchaser are true and correct,
have been prepared in accordance with generally accepted accounting principles
consistently applied (except as disclosed therein and except that interim
financial Statements do not contain the footnotes required by generally accepted
accounting principles), and fairly present the financial condition of the
Company and the results of the operations of the Company as of the respective
dates thereof.
(f) Material Contracts and Commitments. All the material contracts,
commitments, agreements, and instruments to which the Company is a party are
legal, valid, binding, and in full force and effect in all material respects and
enforceable by the Company in accordance with their terms except as limited by
bankruptcy, insolvency, reorganization, moratorium, or similar laws of general
application affecting enforcement of creditors' rights, and except as limited by
application of legal principles affecting the availability of equitable
remedies. The Company is not in material default under any of such contracts.
(g) Compliance with Other Instruments, None Burdensome, etc. The
Company is not in violation of any term of its Articles of Incorporation or
Bylaws, or in any material respect of any mortgage, indenture, contract,
agreement, instrument, or, to the best knowledge of the Company, any judgment,
decree, order, statute, rule, or regulation applicable to it. The execution,
delivery, and performance by the Company of this Agreement, and the issuance and
sale of the Securities pursuant hereto, will not result in any such violation or
be in conflict with or constitute a default under any such term, or cause the
acceleration of maturity of any loan or material obligation to which the Company
is a party or by which it is bound or with respect to which it is an obligor or
guarantor, or result in the creation or imposition of any material lien, claim,
charge, restriction, equity or encumbrance of any kind whatsoever upon, or, to
the best knowledge of the Company after due inquiry, give to any other person
any interest or right (including any right of termination or cancellation) in or
with respect to any of the material properties, assets, business or agreements
of the Company. To the best knowledge of the Company after due inquiry, no such
term or condition materially adversely affects or in the future (so far as can
reasonably be foreseen by the Company at the date of this Agreement) may
materially adversely affect the business, property, prospects, condition,
affairs, or operations of the Company.
(h) Litigation, etc. There are no actions, proceedings or
investigations pending (or, to the best of the Company's knowledge, any basis
therefor or threat thereof), which, either in any case or in the aggregate,
might result in any adverse change in the business, prospects, conditions,
affairs, or operations of the Company or in any of its properties or assets, or
in any impairment of the right or ability of the Company to carry on its
business as proposed to be conducted, or in any material liability on the part
of the Company, or which question the validity of this Agreement or any action
taken or to be taken in connection herewith.
(i) Governmental Consent, etc. No consent, approval, or authorization
of, or designation, declaration, or filing with, any governmental unit is
required on the part of the Company in connection with the valid execution and
delivery of this Agreement, or the offer, sale or issuance of the Securities, or
the consummation of any other transaction contemplated hereby (except exemption
notice filings under the Blue Sky securities laws of those states in which
offers or sales may be made in connection with this Offering, which filings have
been or will be timely made so as to comply with such laws).
(j) Offering. The offer, sale and issuance of the Securities in
conformity with the terms of this Agreement will not violate the Securities Act
of 1933 or any applicable state Blue Sky law.
(k) Insurance. The Company has in full force and effect fire, casualty
and other insurance policies, sufficient in amount (subject to reasonable
deductibles) to allow it to replace any of its properties that might be damaged
or destroyed.
(l) Intellectual Property, etc. To the best of its knowledge, the
Company has sufficient title and ownership of all franchises, permits, licenses
trademarks, trademark rights, copyrights, service marks, trade names, trade
secrets, know-how information, proprietary rights and processes, and other
similar authority necessary for the conduct of its business as now conducted and
as proposed to be conduced by it (collectively, the "Intellectual Property").
The Company is not in violation of, nor will the transaction contemplated by
this Agreement cause a violation of the terms of any franchises, permits or
licenses to which it is a party. There is neither pending, nor to the Company's
knowledge, threatened, any claim or litigation against the Company contesting
the validity or right to use any of the Intellectual Property. To the Company's
knowledge, no person, corporation or other entity is materially infringing the
Intellectual Property. To the Company's knowledge, it is not currently using the
confidential information or trade secrets of any person, or a grant of a license
or other right to use such information or trade secrets, without the consent of
such other person or entity.
(m) Title to and Condition of Properties. The Company has good and
marketable title to all its tangible and intangible property and assets,
including those reflected in the Financial Statements (except such property or
assets as have since December 31, 1999 been sold or otherwise disposed of in the
ordinary course of business), and such property and assets are subject to no
mortgage or security interests, conditional sales contract, charge, lien or
encumbrance (except (i) as disclosed in the Financial Statements and (ii) for
the lien of current taxes not yet due and payable and such imperfections of
title, easements and encumbrances, if any, as are not substantial in character,
amount or extent and do not materially detract from the value of, or interfere
with the present use of the properties subject thereto or affected thereby, or
otherwise materially impair the business operations of the Company), and
subsequent to December 31, 1999 the Company has not sold or disposed of any of
its property and assets or obligated itself to do so except in the ordinary
course of business. Except for such minor defects as are not substantial in
character and which do not have a materially adverse effect upon the validity
thereof, all material real and personal property leases to which the Company is
a party are in good standing, valid and effective, and there is not under any
such lease any existing material default or event which with notice or lapse of
time or both would constitute a material default and in respect of which the
Company has not taken reasonable steps to prevent such a default from occurring.
(n) Taxes. Prior to the date of this Agreement, the Company has filed
all tax returns that are required to have been filed with appropriate federal,
state, county and local governmental agencies or instrumentalities and paid the
taxes thereon.
(o) The Units, the Common Stock and the Warrants:
(i) are free and clear of any security interests, liens, claims,
or other encumbrances;
(ii) have been duly and validly authorized and issued and are,
and on the Closing Date will be, fully paid and non-assessable;
(iii) will not have been, individually and collectively, issued
or sold in violation of any preemptive or other similar rights of the holders of
any securities of the Company;
(iv) will not subject the holders thereof to personal liability
by reason of being such holders.
4. Representations and Warranties of the Purchaser. The Purchaser
represents and warrants to, and agrees with, the Company as follows:
(a) No consent, approval, authorization, or order of any court,
governmental agency or body, or arbitrator having jurisdiction over the
Purchaser is required for execution of this Agreement, including, without
limitation, the purchase of the Securities, or the performance of the
Purchaser's obligations hereunder.
(b) The Purchaser understands that no federal or state agency has
passed on or made any recommendation or endorsement of the Securities.
(c) The Company has given the Purchaser the opportunity to have
answered all of the Purchaser's questions concerning the Company and its
business and has made available to the Purchaser all information requested by
the Purchaser which is reasonably necessary to verify the accuracy of other
information furnished by the Company. The Purchaser has received and evaluated
all information about the Company and its business which the Purchaser deems
necessary to formulate an investment decision and does not desire any further
information.
(d) The Purchaser understands that the Securities are being offered
and sold to it in reliance on specific exemptions or non-application from the
registration requirements of federal and state securities laws and that the
Company is relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgments, and understandings of the Purchaser set
forth herein in order to determine the applicability of such exemptions or
non-applications and the suitability of the Purchaser to acquire the Securities.
(e) The Purchaser is aware that the Securities have not been
registered under the Securities Act by reason of their issuance in a transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act pursuant to Section 4(2) and Regulation D thereof, and that they
must be held by the Purchaser for an indeterminate period and the Purchaser must
therefore bear the economic risk of such investment indefinitely, unless a
subsequent disposition thereof is registered under the Securities Act or is
exempt from registration.
(f) Each instrument representing the Securities may be endorsed with
the following legends:
(i) THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN
ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF
COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO THE
COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT
FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.
(ii) Any other legend required by California or other state
securities laws.
The Company need not register a transfer of legended Securities and may
instruct its transfer agent not to register the transfer of the Securities,
unless one of the conditions specified in the foregoing legends is satisfied.
(g) Any legend endorsed on an instrument pursuant to Section 4(f)
hereof and the stop transfer instructions with respect to such Securities shall
be removed, and the Company shall issue an instrument without such legend to the
holder of such Securities if such Securities are registered under the Securities
Act and a prospectus meeting the requirements of Section 10 of the Securities
Act is available or if such holder provides the Company with an opinion of
counsel for such holder of the Securities, reasonably satisfactory to the
Company, to the effect that a public sale, transfer or assignment of such
Securities may be made without registration.
(h) The Purchaser is either (A) acquiring the Units for the
Purchaser's own account; or (B) for the account of another for which the
Purchaser acts as a fiduciary, in which case the Purchaser will so advise the
Company. If acting as a fiduciary, the Purchaser makes the representations,
warranties, and covenants as set forth herein on its own behalf and as agent for
and on behalf of such other party. The Purchaser is acquiring the Units for
investment and without any present intention to engage in a distribution
thereof.
(i) The Purchaser has the knowledge and experience in financial and
business matters to evaluate the merits and risks of the proposed investment.
(j) The Purchaser is an "Accredited Investor" as that term is defined
under Rule 501 adopted pursuant to the Securities Act. "Accredited Investors"
are defined in Rule 501 to include among others: (A) Various specified
institutional investors (such as banks, savings and loan associations, licensed
brokers or dealers, insurance companies, investment companies, small business
investment companies, employee benefit plans having assets in excess of
$5,000,000, and self-directed plans having investment decisions made solely by
persons that are Accredited Investors); (B) Any entity with total assets in
excess of $5,000,000, not formed for the specific purpose of acquiring the
securities offered; (C) Any person who had individual income in excess of
$200,000 in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level this year; (D) Any person whose
individual net worth (or joint net worth with the person's spouse) at the time
of purchase exceeds $1,000,000; (E) Directors and executive officers of the
Company; (F) Trusts with total assets in excess of $5,000,000 not formed for the
specific purpose of acquiring the securities offered, whose purchase is directed
by a sophisticated person prescribed in Rule 506(b)(2)(ii); and (G) Any entity
in which all the equity owners are deemed accredited.
5. Conditions Precedent to the Purchaser's Obligations. The obligations of
the Purchaser hereunder are subject to the performance by the Company of its
obligations hereunder and to the satisfaction of the following additional
conditions precedent on or before the Closing Date:
(a) The representations and warranties made by the Company in this
Agreement shall, unless waived by the Purchaser, be true and correct as of the
date hereof and at the Closing Date, with the same force and effect as if they
had been made on and as of the Closing Date.
(b) After the date hereof and until the Closing Date, there shall not
have occurred:
(i) any change, or any development involving a prospective
change, in either (A) the condition, financial or otherwise, or in the earnings,
business or operations, or in or affecting the properties of the Company or (B)
the financial or market conditions or circumstances in the United States, in
either case which, in the Purchaser's judgment, is material and adverse and
makes it impractical or inadvisable to proceed with the offering, sale, or
delivery of the Units;
(ii) an imposition of a new legal or regulatory restriction not
in effect on the date hereof, or any change in the interpretation of existing
legal or regulatory restrictions, that materially and adversely affects the
offering, sale, or delivery of the Units.
6. Conditions Precedent to the Company's Obligations. The obligations of
the Company under this Agreement are subject to the performance by the Purchaser
of its obligations hereunder and to the satisfaction of the condition that the
representations and warranties made by the Purchaser in this Agreement shall,
unless waived by the Company, be true and correct at the Closing Date, with the
same force and effect as if they had been made on, and as of, the Closing Date.
7. Survival of the Representations, Warranties, etc. The respective
agreements, representations, warranties, indemnities, and other statements made
by or on behalf of the Company and the Purchaser pursuant to this Agreement
shall remain in full force and effect, regardless of any investigation made by
or on behalf of the other party to this Agreement or any officer, director, or
employee of, or person controlling or under common control with, such party, and
will survive delivery of any payment of the Units.
8. Miscellaneous.
(a) This Agreement may be executed in one or more counterparts and it
is not necessary that signature of all parties appear on the same counterpart,
but such counterparts together shall constitute one and the same agreement.
(b) All notices under this Agreement shall be given in writing, by
registered or certified mail, postage prepaid, addressed to the Company at 400
Oyster Point Blvd., South San Francisco, California 94080 and to the Purchaser
at the addresses set forth opposite his or her name below or at such other
address as may be designated in writing by the parties to one another. Any
notice addressed or mailed as specified herein shall be deemed to have been
given three days after such notice has been deposited in the United States
mails.
(c) This Agreement shall inure to the benefit of and be binding upon
the parties hereto, their respective successors, and no other person shall have
any right or obligation hereunder.
(d) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of California.
(e) The headings of the sections of this document have been inserted
for convenience of reference only and shall not be deemed to be a part of this
Agreement.
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement, all as of March __, 2000.
COMPANY:
ACCUIMAGE DIAGNOSTICS CORP.
By:
---------------------------------------
Robert Taylor, Chief Executive Officer
PURCHASER:
-------------------------------------------
-------------------------------------------
Name of Purchaser [type or print]
-------------------------------------------
Street Address
-------------------------------------------
City, State and ZIP Code
Amount of Investment: $
-------------------
Units Purchased:
--------------------------
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
AccuImage Diagnostic Corp. condensed financial statements for the interim period
ended March 31, 2000 included in Form 10-QSB and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<CIK> 0001089799
<NAME> ACCUIMAGE DIAGNOSTICS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 701,470
<SECURITIES> 0
<RECEIVABLES> 467,786
<ALLOWANCES> (16,619)
<INVENTORY> 143,000
<CURRENT-ASSETS> 1,315,852
<PP&E> 52,470
<DEPRECIATION> (154,541)
<TOTAL-ASSETS> 1,888,120
<CURRENT-LIABILITIES> 424,591
<BONDS> 0
0
0
<COMMON> 10,697
<OTHER-SE> 1,452,832
<TOTAL-LIABILITY-AND-EQUITY> 1,888,120
<SALES> 802,341
<TOTAL-REVENUES> 802,341
<CGS> 73,826
<TOTAL-COSTS> 432,957
<OTHER-EXPENSES> (2,813)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 298,451
<INCOME-TAX> 400
<INCOME-CONTINUING> 298,051
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 298,051
<EPS-BASIC> .03
<EPS-DILUTED> .03
</TABLE>
