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U. S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JULY 31, 1999
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________
Commission file number 0-9064
APPLIED MEDICAL DEVICES, INC.
(Exact name of small business issuer as specified in its charter)
Colorado 84-0789885
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1722 Buffehr Creek Road, Vail, CO 81657
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, (970) 479-2800
including area code
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
State the number of shares outstanding of each of the Issuer's classes of common
stock, as of the latest practicable date.
Class Outstanding at July 30, 1999
Common Stock, $.01 par value 65,977,800
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APPLIED MEDICAL DEVICES, INC.
Form 10-QSB
Table of Contents
<TABLE>
<S> <C>
Part I. Financial Information...................................................... 3
Consolidated Balance Sheets as of July 31, 1999 and
April 30, 1999...................................................................... 4
Consolidated Statements of Operations for the three month periods ended July 31,
1999, July 31, 1998 and Since Being a
Development Stage Company........................................................... 5
Consolidated Statements of Cash Flows for the year-to-date periods ended July
31, 1999, July 31, 1998, and Since Being a Development
Stage Company....................................................................... 6
Management's Discussion and Analysis of Financial Condition
and Results of Operations........................................................... 7&8
Part II. Other Information......................................................... 8
Signature Page...................................................................... 9
</TABLE>
Form 10-QSB
Page 2 of 9
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APPLIED MEDICAL DEVICES, INC.
FORM 10-QSB
JULY 31, 1999
PART I. FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
The unaudited financial statements reflect all adjustments and contain all
information necessary, in the opinion of management, for a fair presentation of
the financial position and results of operation for the interim periods reported
when these statements are read in conjunction with the notes to financial
statements included in the Registrant's Form 10-KSB for the year ended April 30,
1999.
Form 10-QSB
Page 3 of 9
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APPLIED MEDICAL DEVICES, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
JULY 31, April 30,
1999 1999
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT -
Cash and cash equivalents $ 144,367 $ 146,121
- -----------------------------------------------------------------------------------------------------------
$ 144,367 $ 146,121
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES -
Accrued expenses $ 460 $ 310
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SHAREHOLDERS' EQUITY
Common Stock - $.01 par value, 75,000,000 shares
authorized, issued and outstanding 65,977,800
as of July 31, 1999 and April 30, 1999 659,778 659,778
Additional paid-in capital 4,172,128 4,172,128
Accumulated deficit (4,451,999) (4,451,999)
Deficit accumulated during the
development stage (236,000) (234,096)
- -----------------------------------------------------------------------------------------------------------
Total shareholders' equity 143,907 145,811
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$ 144,367 $ 146,121
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</TABLE>
See accompanying notes to consolidated financial statements.
Form 10-QSB
Page 4 of 9
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APPLIED MEDICAL DEVICES, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Since Being
THREE MONTHS Three Months A Develop-
ENDED Ended ment Stage
JULY 31, 1999 July 31, 1998 Company
------------- ------------- -------
<S> <C> <C> <C>
EXPENSES -
General and
administrative $ 3,532 $ 9,321 $426,744
- -----------------------------------------------------------------------------------------
OTHER INCOME:
Interest income 1,628 2,004 127,155
Other - - 32,536
Gain from sale of
marketable securities - - 31,053
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Total other income 1,628 2,004 190,744
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Net Loss $ (1,904) $ (7,317) (236,000)
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- -----------------------------------------------------------------------------------------
BASIC AND DILUTED INCOME
(LOSS) PER SHARE nil nil
- -----------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------
WEIGHTED AVERAGE NUMBER
OF COMMON AND COMMON
EQUIVALENT SHARES
OUTSTANDING 65,977,800 65,977,800
</TABLE>
See accompanying notes to consolidated financial statements.
Form 10-QSB
Page 5 of 9
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APPLIED MEDICAL DEVICES, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS Three Months Since Being
ENDED ended A Development
JAN. 31, 1999 Jan. 31,1998 Stage Company
------------- ------------ -------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net loss $ (1,904) $ (7,317) $(236,000)
Adjustments to reconcile net loss to
cash used in operating activities:
Gain from sale of marketable securities - - (31,053)
Issuance of common stock for services - - 7,565
Changes in operating assets and liabilities:
Accounts receivable - - 4,903
Accrued expenses 150 3,684 (42,650)
Other - - 10
Prepaid expenses - - -
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Net cash used in operating activities (1,754) (3,633) (297,225)
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INVESTING ACTIVITIES -
Proceeds from sale of marketable securities - - 47,040
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FINANCING ACTIVITIES:
Proceeds from issuance of common stock - - 139,368
Proceeds from exercise of stock warrants - - 98,000
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Net cash provided by financing activities - - 237,368
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INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,754) (3,633) (12,817)
CASH AND CASH EQUIVALENTS,
beginning of period 146,121 160,103 157,184
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CASH AND CASH EQUIVALENTS,
end of period $ 144,367 $156,470 $ 144,367
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- ------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to consolidated financial statements.
Form 10-QSB
Page 6 of 9
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The unaudited consolidated financial statements and related notes have been
prepared pursuant to the rules and regulations of the Securities and Exchange
Commission. Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with
generally accepted accounting principles have been omitted pursuant to such
rules and regulations. The accompanying financial statements and related
notes should be read in conjunction with the audited financial statements of
the Company, and notes thereto, for the year ended April 30, 1999.
The following review concerns the three month periods ended July 31, 1999,
and July 31, 1998, which should be read in conjunction with the financial
statements and notes thereto presented in this Form 10-QSB.
The information set forth in "Management's Discussion and Analysis of
Financial Condition and Results of Operations" below includes "forward
looking statements" within the meaning of Section 27A of the Securities Act,
and is subject to the safe harbor created by that section. Factors that could
cause actual results to differ materially from these contained in the forward
looking statements are set forth in "Management's Discussion and Analysis of
Financial Condition and Results of Operations."
PLAN OF OPERATION.
The Company has 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 current fiscal year. It is presently
unknown whether any transaction will be concluded. The Company considers its
current cash and cash equivalent balances adequate to satisfy its cash
requirements for the next twelve months. However, legal and accounting and
other expenses could increase significantly in connection with any
contemplated 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.
The Company has no significant equipment and has not engaged in any research
or development activities during the past two fiscal years. At present, the
Company employs one person, on a part-time basis. The Company does not expect
any changes unless the Company determines to proceed with a business
combination.
RESULTS OF OPERATIONS THREE MONTHS ENDED JULY 31, 1999 AND JULY 31, 1998.
During the three months ended July 31, 1999, the Company had a net loss of
approximately $1,900. The Company incurred general and administrative costs
of approximately $3,500. The Company's revenues consisted solely of interest
on cash and other money market instruments of approximately $1,600. During
the three months ended July 31, 1998, the general and administrative costs
were approximately
Form 10-QSB
Page 7 of 9
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$9,300 and the Company's revenues consisted of approximately $2,000 from
interest on cash and other money market instruments, resulting in a loss of
approximately $7,300 for the period. As detailed on the accompanying
consolidated statements of cash flows, there were no significant adjustments
between the net loss and net change in cash.
As stated above in the 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, after identifying a
potential business opportunity, the Company could 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 substantial. Thereafter, results
of operations would likely be materially affected by the business acquired by
the Company.
YEAR 2000 COMPLIANCE The Company has completed a review and risk assessment
of all technology items used in its operations. The Company believes that the
year 2000 problem will pose no significant operational problems. The
Company's accounting software program as well as other office software will
be upgraded during 1999 to be year 2000 compliant. The Company estimates that
the cost of the upgrades will be approximately $1,000. The Company will
review the status of the year 2000 issues with its financial institutions.
The financial statements reflect all adjustments which are, in the opinion of
management, necessary for a fair statement of the results for the periods
presented. All significant intercompany accounts and transactions have been
eliminated in consolidation.
PART II. OTHER INFORMATION
Not Applicable.
Form 10-QSB
Page 8 of 9
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APPLIED MEDICAL DEVICES, INC.
FORM 10-QSB
JULY 31, 1999
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
APPLIED MEDICAL DEVICES, INC.
Date: September 8, 1999 By: /s/ Allan K. Lager
-----------------------------------------
Allan K. Lager, President
and Chief Financial Officer
Form 10-QSB
Page 9 of 9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-2000
<PERIOD-START> MAY-01-1999
<PERIOD-END> JUL-31-1999
<CASH> 144,367
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 144,367
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 144,367
<CURRENT-LIABILITIES> 460
<BONDS> 0
0
0
<COMMON> 659,778
<OTHER-SE> (515,871)
<TOTAL-LIABILITY-AND-EQUITY> 144,367
<SALES> 0
<TOTAL-REVENUES> 1,628
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,532
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,904)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,904)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
