<PAGE>
U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
X Annual Report Pursuant to Section 13 or 15(d) of the
- ------ Securities Exchange Act of 1934 (Fee Required)
Transition Report Pursuant to Section 13 or 15(d) of the
- ------ Securities Exchange Act of 1934 (No Fee Required)
For the fiscal year ended April 30, 1996
Commission file number 0-9064
APPLIED MEDICAL DEVICES, INC.
-----------------------------
(Name of small business issuer in its charter)
Colorado 84-0789885
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
8100 W. Crestline Avenue, Suite A-15, #330, Denver, CO 80123
- ------------------------------------------------------ -----------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (970) 479-2800
Securities registered pursuant to Section 12(b) of the Exchange Act: None
Securities registered pursuant to Section 12(g) of the Exchange Act:
- --------------------------------------------------------------------
Common Stock, $.01 Par Value
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act during the past 12 months
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
----- ------
Check if there is no disclosure of delinquent filers pursuant to Item 405 of
Regulation S-B is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [ X ]
The issuer had no revenues in its most recent fiscal year.
The aggregate market value of the voting stock held by non-affiliates was
approximately $1,022,700 based upon the average bid and asked prices of the
stock on June 20, 1996 of $.016.
The number of shares of the Registrant's $.01 par value common stock
outstanding as of June 20, 1996 was 65,977,800.
<PAGE>
Part I
Item 1. DESCRIPTION/BUSINESS.
(a) BUSINESS DEVELOPMENT. Applied Medical Devices, Inc., (a
development stage company) the Registrant (the "Company"), was incorporated
under the laws of the State of Colorado on February 5, 1979. Until 1986, the
Company engaged in the development and sale of medical devices and medical
technology. The Company's efforts in the medical products industry were
unsuccessful, and the Company accumulated a substantial deficit since
inception. In July 1986, the Company determined to discontinue its operations
in the medical products industry. The Company reduced its staff and commenced
its present activities which consist of the search for an acquisition, merger
or other form of business combination with an existing business. Although the
Company has evaluated certain entities, and in some instances, engaged in
discussions concerning possible arrangements, there are presently no
agreements, arrangements or understandings with respect to any such
acquisition, merger or combination.
(b) BUSINESS OF ISSUER. The Company, which originally operated
in the medical products industry, discontinued operations in that industry in
1986 due to continued losses. Since that time, the Company has been engaged
in the investigation of business opportunities with the goal of attempting to
effect a business combination with another entity.
Although the Company has engaged in evaluations of certain
business opportunities, the Company has no firm arrangements, commitments or
agreements with respect to any acquisition, merger or other form of business
combination. The nature of the specific business which the Company may
acquire cannot be determined at the present time. Due to the limited capital
available to the Company, there can be no assurance that the Company will be
able to locate or acquire any attractive business on terms favorable to the
Company. In addition, it is anticipated that with the Company's limited
capital the Company would be able to acquire only one business.
A substantial amount of time may elapse and the Company may
expend considerable funds for consulting, legal, accounting and other fees
before the Company is able, if at all, to acquire any business or effect a
merger or other form of business combination. Such expenditures may have an
adverse impact on the ability of the Company to carry out its plan or, on its
ability to continue any business which it acquires. The Company will be an
insignificant participant among the firms which engage in the mergers with
and acquisitions of privately-financed entities. There are many established
venture capital and financial concerns which have significant financial and
personnel resources, technical expertise and greater experience than the
<PAGE>
Company. In addition, the Company is competing with numerous small entities
similar in size and scope of operations to the Company. In view of the
Company's limited financial resources and limited management availability,
the Company is at a significant competitive disadvantage vis-a-vis many of
the Company's competitors.
The Company has no trademarks, licenses, franchises,
concessions, royalty agreements or labor contracts. The Company produces no
products, has no key suppliers and has no backlog. The Company has no
contracts with the United States Government. The Company has no dependence
upon a single customer, or a few customers. The Company has not engaged in
any research and development activities during the past two fiscal years.
The Company has not incurred expenditures in connection with compliance with
governmental provisions relating to the environment.
At the present, the Company employs one person, on a part-time
basis.
Item 2. DESCRIPTION OF PROPERTIES.
The Company owns no real property. The Company presently
subleases office facilities from, and is provided administrative services by,
an entity that has certain common shareholders with the Company. The
facilities and services are provided on a month-to-month basis for $500 per
month pursuant to an oral arrangement. See Item 12.
Item 3. LEGAL PROCEEDINGS.
The Company is not involved in any material pending legal
proceedings.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted to a vote of the Company's security
holders during the fourth quarter covered by this Report, and this Item is,
therefore, inapplicable.
PART II
Item 5. MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
The Company's $.01 par value common stock is traded in the
over-the-counter market. Trading in the Company's stock is believed to be
sporadic. Moreover, the Company's stock is not traded on any exchange or on
NASDAQ, but instead trades on the Electronic Bulletin Board under the symbol
AMDI. Accordingly, although the quotations set forth below have been
obtained from sources believed to be reliable, there can be no assurance that
they accurately reflect the trading markets. The range of high and low bid
quotations for each quarterly period during the two most recent fiscal years
is set forth below:
Quarter Ended High Bid Low Bid
------------- -------- -------
April 30, 1996 $.002 $.001
January 31, 1996 $.002 $.001
October 31, 1995 $* $*
July 31, 1995 $* $*
April 30, 1995 $.0001 $.0001
January 31, 1995 $.0001 $.0001
October 31, 1994 $.0001 $.0001
July 31, 1994 $.001 $.0001 *No bids were
reported
The quotations for the Company's common stock reflect
inter-dealer prices, without retail mark-up, mark-down or commission and may
not necessarily represent actual transactions.
<PAGE>
At June 20, 1996, the approximate number of holders of record
of the Company's common stock was 9,963. The Company has not paid any cash
dividends.
Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
PLAN OF OPERATION.
During the fiscal year ended April 30, 1996, the Company continued
its efforts to acquire, merge with or enter into another form of business
combination with another entity, and the Company plans to continue these
efforts in the fiscal year ending April 30, 1997. The Company generated
approximately $11,700 in interest income and had expenses of approximately
$28,400 in the year ended April 30, 1996. Total assets, which declined by
approximately six percent from $227,100 to $214,800, consisted primarily of
cash or cash equivalents. The Company considers its current cash and cash
equivalent balances adequate to satisfy its cash requirements for the next
twleve months, even if legal and accounting and other expenses were to
increase significantly should the Company identify a suitable candidate for a
business combination. Due to the nature of the Company's present activities,
however, the Company is unable to predict its likely expenditures for
professional fees and other expenses. The Company has no major capital
commitments.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
FISCAL YEARS ENDED APRIL 30, 1996 AND APRIL 30, 1995.
During the fiscal year ended April 30, 1996, the Company had a net
loss of approximately $12,300. Net cash used in operating activities during
the fiscal year 1996 was approximately $16,600. The Company incurred general
and administrative costs of approximately $28,400 in fiscal 1996 of which
approximately $18,900 were incurred in connection with daily operations and
evaluation of business opportunities. Accounting, legal and transfer fees
were approximately $9,500 or 33 percent of the total general and
administrative expenses. The Company had gains from the sale of investment
securiites of approximately $4,300 and earned interest on temporary cash and
other money market instruments of approximately $11,700. Interest income
fluctuates based upon increases and decreases with general interest rates
which cannot be predicted.
During the fiscal year ended April 30, 1995, the Company had a net
loss of $16,900. Net cash used in operating activities during the fiscal year
1995 was approximately $18,100. The Company incurred general and
administrative costs of approximately $25,700 in fiscal 1995 of which
approximately $16,000 were incurred in connection with daily operations and
evaluation of business opportunities. Accounting, legal and transfer fees
were approximately $9,700 or 36 percent of the total general and
administrative expenses. The Company's revenues consisted of interest on
temporary cash and other money market instruments in the amount of
approximately $8,100 and gains from the sale of investment securities of
appoximately $700.
As stated above in Plan of Operation, due to the nature of the
Company's activities, the Company's prospects for the future are dependent on
a number of variables which cannot be predicted. Generally, if the Company
were to identify a potential business opportunity, it is likely that the
Company would incur significant costs in evaluating the desirability of an
acquisition or other form of business combination. Should the Company
determine to proceed with the business combination, the transaction costs
could be significant. Thereafter, results of operations would likely be
materially affected by the business acquired by the Company.
<PAGE>
INCOME TAXES AND NET OPERATING LOSSES
As discussed in Note 1 in the accompanying consolidated financial
statement, the Company had net operating loss carryforwards for income tax
purposes of approximately $3,831,000, of which approximately $254,000 are
limited to future taxable income, if any, of the Company's inactive
subsidiary. The deferred tax asset arising from the net operating loss
carryforwards has been fully offset by a valuation allowance as it was unable
to be determined if such tax benefits would more likely than not be realized.
Item 7. FINANCIAL STATEMENTS.
See pages F-1 through F-8.
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
Report of Independent Certified Public Accountants F-2
Consolidated Balance Sheet as of
April 30, 1996 F-3
Consolidated Statements of Operations for the
Years Ended April 30, 1996 and 1995
and for the Period from May 1, 1987
(Beginning of the Development Stage) to
April 30, 1996 F-4
Consolidated Statements of Stockholders' Equity for
the Years Ended April 30, 1996 and 1995
and for the Period from May 1, 1987
(Beginning of the Development Stage) to
April 30, 1994 F-5
Consolidated Statements of Cash Flows for the
Years Ended April 30, 1996 and 1995
and for the Period from May 1, 1987
(Beginning of the Development Stage) to
April 30, 1996 F-6
Summary of Accounting Policies F-7
Notes to Consolidated Financial Statements F-8
F-1
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Stockholders and Board of Directors
Applied Medical Devices, Inc.
Denver, Colorado
We have audited the accompanying consolidated balance sheet of Applied
Medical Devices, Inc. and subsidiary (a development stage company) as of
April 30, 1996 and the related consolidated statements of operations,
stockholders' equity, and cash flows for each of the two years in the period
ended April 30, 1996. We have also audited the statements of operations,
stockholders' equity and cash flows for the period from the beginning of
development stage (May 1, 1987) to April 30, 1996. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above, and
the cumulative amounts for the period from May 1, 1987 (beginning of
development stage) to April 30, 1996, present fairly, in all material
respects, the financial position of Applied Medical Devices, Inc. and
subsidiary at April 30, 1996 and the results of their operations and their
cash flows for each of the two years in the period ended April 30, 1996 and
the period from the beginning of development stage (May 1, 1987) to April 30,
1996, in conformity with generally accepted accounting principles.
BDO SEIDMAN, LLP
Denver, Colorado
May 31, 1996
F-2
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEET
- -------------------------------------------------------------------------------
APRIL 30, 1996
- -------------------------------------------------------------------------------
ASSETS
CURRENT -
Cash and cash equivalents $ 214,845
- -------------------------------------------------------------------------------
$ 214,845
- -------------------------------------------------------------------------------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES -
Accrued expenses $ 61
COMMITMENT (Note 3)
STOCKHOLDERS' EQUITY (Note 2):
Common stock, $.01 par value; 75,000,000 shares
authorized, issued and outstanding, 65,977,800 659,778
Additional paid-in capital 4,172,128
Accumulated deficit (4,451,999)
Deficit accumulated during the development stage (165,123)
- -------------------------------------------------------------------------------
Total stockholders' equity 214,784
- -------------------------------------------------------------------------------
$ 214,845
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES AND NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS.
F-3
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
- ------------------------------------------------------------------------------
Development
Stage
Year Ended April 30, 1996 1995 Cumulative(a)
- ------------------------------------------------------------------------------
EXPENSES - General and
administrative $ 28,405 $ 25,682 $ 328,385
- -------------------------------------------------------------------------------
OTHER INCOME:
Interest income 11,725 8,143 99,673
Gain from sale of marketable securities 4,340 675 31,053
Other 63 6 32,536
- -------------------------------------------------------------------------------
Total other income 16,128 8,824 163,262
- -------------------------------------------------------------------------------
NET LOSS $ (12,277) $ (16,858) $ (165,123)
- ------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NET LOSS PER SHARE OF
COMMON STOCK $ Nil $ Nil
- -------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 65,977,800 65,977,800
- -------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES AND NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS.
(a) Cumulative from May 1, 1987 (beginning of the development stage) to
April 30, 1996.
F-4
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
- -------------------------------------------------------------------------------
YEARS ENDED APRIL 30, 1996 AND 1995 AND PERIOD FROM MAY 1, 1987 (BEGINNING OF
THE DEVELOPMENT STAGE) TO APRIL 30, 1994
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional During the Total
-------------------- Paid-in Accumulated Development Treasury Stockholders'
Shares Amount Capital Deficit Stage Stock Equity
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, May 1, 1987 43,256,994 $432,570 $ 4,389,342 $ (4,451,999) $ - $ 234,949 $ 604,862
Common stock issued
for services 1,357,473 13,575 (6,000) - - - 7,575
Retirement of treasury
stock (3,136,667) (31,367) (203,582) - - (234,949) (469,898)
Issuance of common
stock and warrants
pursuant to public
offering 14,700,000 147,000 (7,632) - - - 139,368
Exercise of stock
purchase warrant 9,800,000 98,000 - - - - 98,000
Net loss for the periods - - - - (135,988) - (135,988)
- ---------------------------------------------------------------------------------------------------------------------------
BALANCE, April 30, 1994 65,977,800 659,778 4,172,128 (4,451,999) (135,988) - 243,919
Net loss for the year - - - - (16,858) - (16,858)
- ---------------------------------------------------------------------------------------------------------------------------
BALANCE, April 30, 1995 65,977,800 659,778 4,172,128 (4,451,999) (152,846) - 227,061
Net loss for the year - - - - (12,277) - (12,277)
- ---------------------------------------------------------------------------------------------------------------------------
BALANCE, April 30, 1996 65,977,800 $659,778 $ 4,172,128 $ (4,451,999) $ (165,123) $ - $ 214,784
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES AND NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS.
F-5
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
- ------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
<TABLE>
Development
Stage
YEAR ENDED APRIL 30, 1996 1995 Cumulative(a)
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
OPERATING ACTIVITIES:
Net loss $(12,277) $(16,858) $(165,123)
Adjustments to reconcile net
loss to cash used in
operating activities:
Gain from sale of marketable securities (4,340) (675) (31,053)
Issuance of common stock for services - - 7,565
Changes in operating assets and liabilities:
Accounts receivable - - 4,903
Accrued expenses - (557) (43,049)
Other - - 10
- ------------------------------------------------------------------------------------------
Net cash used in operating activities (16,617) (18,090) (226,747)
- ------------------------------------------------------------------------------------------
INVESTING ACTIVITIES -
Proceeds from sale of marketable securities 4,340 1,425 47,040
- ------------------------------------------------------------------------------------------
FINANCING ACTIVITIES:
Proceeds from issuance of
common stock - - 139,368
Proceeds from exercise of
stock warrants - - 98,000
- ------------------------------------------------------------------------------------------
Net cash provided by financing activities - - 237,368
- ------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (12,277) (16,665) 57,661
CASH AND CASH EQUIVALENTS,
beginning of year 227,122 243,787 157,184
- ------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS,
end of year $214,845 $227,122 $214,845
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
SEE ACCOMPANYING SUMMARY OF ACCOUNTING POLICIES
AND NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
(a) Cumulative from May 1, 1987 (beginning of the development stage) to April
30, 1996.
F-6
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
SUMMARY OF ACCOUNTING POLICIES
- ------------------------------------------------------------------------------
ORGANIZATION
AND
BUSINESS
Applied Medical Devices, Inc. (the "Company")(a development stage
company) was incorporated on February 5, 1979 under the laws of the State of
Colorado to engage in the development and sale of medical devices and
medical technology. In July, 1986, the Company decided to discontinue its
business operations and commenced disposing of its business assets. As of
May 1, 1987, the Company had completed the disposition of its business
operations. Since that time, the Company's operations have consisted of efforts
to pursue other business opportunities and funding sources. Accordingly, the
Company is considered to be in the development stage.
The financial statements include the accounts of the Company and its inactive
wholly owned subsidiary, Applied Medical, Inc. ("AMI"). All intercompany
accounts and transactions have been eliminated.
FINANCIAL
INSTRUMENTS AND
CONCENTRATIONS OF
CREDIT RISK
The Company's financial instruments that are exposed to concentrations of
credit risk consist primarily of cash equivalents.
The Company's cash equivalents are invested in money market accounts placed
with major financial institutions and in United States government securities.
The investment policy limits the Company's exposure to concentrations of
credit risk. Money market deposit accounts at times may exceed federally
insured limits. The Company has not experienced any losses in such accounts.
USE OF
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the consolidated financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NET LOSS
PER SHARE
Net loss per common share is based on the weighted average number of shares
outstanding during each period presented. Stock options and warrants, when
outstanding, are included as common stock equivalents, when dilutive.
CASH EQUIVALENTS
The Company considers all highly liquid investments purchased with an
original maturity of three months or less to be cash equivalents. At April 30,
1996 cash equivalents include a United States Treasury bill of approximately
$200,000.
INCOME TAXES
The Company accounts for income taxes under Statement of Financial
Accounting Standards No. 109 ("FASB No. 109"). Temporary differences are
differences between the tax basis of assets and liabilities and their reported
amounts in the financial statements that will result in taxable or deductible
amounts in future years. The Company's temporary differences consist of its
net operating loss carryforwards and capitalized start-up costs.
F-7
<PAGE>
APPLIED MEDICAL DEVICES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- ------------------------------------------------------------------------------
1. INCOME TAXES
As of April 30, 1996 the net deferred tax asset recorded and its approximate
tax effect consists of tax operating loss carryforwards and capitalized start-up
costs of $1,620,000. As of April 30, 1996, a valuation allowance equal to the
net deferred tax asset recognized has been recorded, as it was determined that
it is more likely than not that the deferred tax asset will not be realized.
At April 30, 1996 the Company has net operating loss carryforwards of
approximately $3,577,000 which expire through 2010.
In addition, AMI has approximately $254,000 in net operating loss
carryforwards which were generated prior to AMI's acquisition by the
Company. These net operating loss carryforwards may be used only to offset
AMI's future earnings should AMI reactivate its operations.
2. STOCKHOLDERS'
EQUITY
During fiscal 1988 and 1989, the Company issued a total of 1,356,473 of its
common shares to certain employees and directors for services valued at
$7,565.
In fiscal 1989, the Company completed a public offering whereby it sold
14,700,000 shares of its common stock and 9,800,000 warrants to purchase
common shares at $.01 per share. Total proceeds, net of expenses of $7,632
were $139,368.
During fiscal 1990, all of the warrants were exercised and the Company
received proceeds of $98,000.
In fiscal 1993, the Company issued 1,000 of its common shares to a
stockholder for consideration received in prior years valued at $10.
3. COMMITMENT
The Company leases office space from an affiliate of a stockholder for $500
per month on a month-to-month basis. Rent expense for the years ended April
30, 1996, and 1995 was $6,260 and $6,390.
F-8
<PAGE>
Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE.
There were no changes in accountants during the fiscal year
ended April 30, 1996. Not applicable.
PART III
Item 9. DIRECTORS AND EXECUTIVE OFFICERS.
<TABLE>
<CAPTION>
Date First
Elected Principal Occupation
Name Age Director and Employment
______________________________________________________________________________
<S> <C> <C> <C>
Gary Brunner 51 1988 Mr. Brunner has been self employed as a
medical services consultant since 1985.
From 1981 to 1985, he was Vice President
of Operations of the Company. Mr. Brunner
received a B.S. degree from the University
of Northern Colorado in 1968. Mr. Brunner
became Secretary and Director of the
Company in October 1988.
Allan K. Lager 53 1989 Mr. Lager has been an automotive consultant
since 1988. From 1978 to 1988, he was
President and Director of Storz, Inc., a
firm involved in the sales and service of
Porsche automobiles. Mr. Lager became
President and Director of the Company in
April 1989.
Kenneth E. Shearer 51 1988 During the past six years, Mr. Shearer was
first employed by the Denver Economic
Development Authority and subsequently is
a management consultant in the area health
management and economics. From 1982 to
1987, Mr. Shearer was a Telemarketing
Communications Seminar Manager with Mountain
Bell in Denver, Colorado. Mr. Shearer received
a Bachelor's degree in pre-law in 1962 from
Central State University and a Master's
degree in public and international affairs
in 1964 from the University of Pittsburgh.
</TABLE>
The directors of the Company are elected to serve until the next
Annual Meeting of Shareholders or until their successors have been duly
elected and qualified. None of the Company's officers has an employment
agreement with the Company and, therefore, each serves at the pleasure of the
Company's Board of Directors. There are no family relationships among the
Company's officers and directors. During the fiscal year ended April 30,
1996, the Company held one meeting of Directors by unanimous consent. The
Company's Board of Directors has no committees. There are no standard or
other arrangements pursuant to which directors are compensated as such or
for committee particpation.
<PAGE>
Based solely upon a review of Forms 3, 4 and 5, which have been
furnished to the Company with respect to the past fiscal year of the Company,
and certain representations made by officers and directors of the Company in
connection therewith, the Company has no knowledge that any current officer
or director failed to file on a timely basis any reports required by Section
16(a) of the Securities Exchange Act of 1934 with respect to the fiscal year
of the Company ended April 30, 1996.
Item 10. EXECUTIVE COMPENSATION.
(a) CASH COMPENSATION. The following sets forth cash compensation
paid by the Company during the fiscal year ended April 30, 1996 to executive
officers as a group. No officer received more than $100,000 during the fiscal
year.
Mr. Lager receives a salary of $400 per month ($4,800 annually) for
serving as President of the Company. Mr. Lager's salary has remained at this
level in each of the three fiscal years in which he has served as President
of the Company. Neither Mr. Lager nor any other officer or director of the
Company has received any other compensation, cash or otherwise, from the
Company, in any of the past three years. Accordingly, the Summary
Compensation Table has been omitted.
(b) OPTION SAR GRANTS TABLE; AGGREGATED OPTION/SAR EXERCISE AND
FISCAL YEAR END OPTION/SAR TABLE; AGREGATED OPTION/SAR EXERCISED IN LAST
FISCAL YEAR AND FISCAL YEAR END OPTION/SAR VALUES; TERM INCENTIVE PLAN AWARDS
TABLE.
None of the Company's officers or directors was granted or exercised
any stock option, stock appreciation right or received any awards under any
long term incentive, stock option or similar plan; accordingly, no tables for
these items are included.
Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth the persons known to the Company to
own beneficially more than five percent of the outstanding shares of common
stock of the Company on June 20, 1996, and the number of shares of common
stock of the Company beneficially owned by each director of the Company and
all officers and directors of the Company as a group.
Number of Percent of
Beneficial Owner Shares Class
______________________________________________________________________________
Gary Brunner (1)
1071 S. Foothill Drive
Lakewood, Colorado 80228 716,473 1.1%
Allan K. Lager
1040 S. Franklin Street
Denver, Colorado 80209 1,141,667 1.7%
Kenneth E. Shearer
1175 Emerson Street, Suite 208
Denver, Colorado 80218 200,000 .3%
All officers and directors
as a group (3 persons) 2,058,140 3.1%
__________
Gary McAdam (2)
14 Red Tail Drive
Highlands Ranch, Colorado 80126 5,975,000 9.1%
Jill J. Pusey (3)
1722 Buffehr Creek Road
Vail, Colorado 81657 4,933,333 7.5%
________________________________
(1) Includes 560,000 shares owned by Brunner & Associates, P.C., a
corporation owned by Mr. Brunner. Does not include 568,566 shares owned by
Mr. Brunner's father.
(2) Includes shares held by: GJM Trading Partners, Ltd., a partnership of
which Mr. McAdam is the general partner; Creative Investment Services, Inc., a
corporation of which Mr. McAdam is President and a director; and pension and
profit sharing plans of which Mr. McAdam is the trustee and sole beneficiary.
(3) Includes 1,766,666 shares held by Mrs. Pusey as custodian for her minor
children. Does not include 1,293,000 shares owned beneficially by Gregory
Pusey, who is Mrs. Pusey's husband. Mrs. Pusey disclaims any beneficial
interest in the shares owned by Mr. Pusey.
Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Since August 1989, the Company has been subleasing office facilities
from, and been provided administrative services by, Livingston Capital, Ltd.
("Livingston"), a venture capital firm, for $500 per month. Gregory Pusey is
an officer and director of Livingston and Jill J. Pusey is an officer and
principal shareholder of Livingston. See Item 11. The Company believes that
the terms of its arrangement with Livingston are as favorable as could be
obtained with another firm. The Company's arrangements with Livingston are on
a month-to-month basis.
Item 13. EXHIBITS AND REPORTS ON FORM 8-K.
(a) EXHIBITS.
The exhibits listed on the accompanying index to exhibits are
filed as part of this Annual Report.
(b) REPORTS ON FORM 8-K.
No Reports on Form 8-K were filed during the period covered by
this report.
INDEX TO EXHIBITS
1 (a) Articles of Incorporation, as amended, of the Company,
previously filed as an exhibit to the Form 10-K Report for the year ended
April 30, 1981, which Exhibit is incorporated herein by reference thereto.
(b) Bylaws of the Company, previously filed as Exhibit 2(b)
to the Company's Registration Statement on Form S-18 (File No. 2-65079), which
Exhibit is incorporated herein by reference.
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
APPLIED MEDICAL DEVICES, INC.
Date: July 29, 1996 By: /s/ Allan K. Lager
_________________________________
Allan K. Lager, President
In accordance with the Exchange Act, this report has been signed
below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
Date: July 29, 1996 By: /s/ Allan K. Lager
_________________________________
Allan K. Lager, President
Date: July 29, 1996 By: /s/ Gary Brunner
_________________________________
Gary Brunner, Secretary and Director
Date: July 29, 1996 By: /s/ Kenneth E. Shearer
_________________________________
Kenneth E. Shearer, Director
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