SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
(AMENDMENT NO. 3)
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) -- May 5, 1998
-------------
AMERICAN ELECTROMEDICS CORP.
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(Exact name of registrant as specified in its charter)
Delaware 0-9922 04-2608713
------------------- -------------------- -------------
(State or (Commission (IRS Employer
other jurisdiction File Number) Identification
of Incorporation) No.)
13 Columbia Drive, Suite 5, Amherst, New Hampshire 03031
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(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code -- (603) 880-6300
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Not Applicable
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(Former Name or Former Address, if changed since last report)
The purpose of this Amendment is to replace the accountant's
reports in Item 7(a)(iii) and to amend Item 7(b) in its entirety
to read as set forth herein.
<PAGE>
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
-----------------------------------------------------
AND EXHIBITS
------------
On June 5, 1998, American Electromedics Corp., a Delaware
corporation (the "Company") filed a Form 8-K to report the
acquisition of Dynamic Dental Systems, Inc. ("Dynamic") and
Equidyne Systems, Incorporated ("Equidyne"). The financial
statements required to be filed under Item 7(a) and (b) of such
Form 8-K were to be filed thereafter by amendment. Amendment No.
1 to the Form 8-K included the following: (1) financial
statements of Dynamic, (ii) financial statements of Equidyne,
(iii) financial statements of Rosch GmbH Medizintechnik ("Rosch
GmbH"), (iv) the Company's pro forma financial statements
reflecting the acquisition of Dynamic and Equidyne, and (v) the
Company's pro forma financial statements reflecting the Rosch
GmbH acquisition.
This Amendment No. 3 amends the financial statements.
Page
----
(a)(iii) Financial Statements of Rosch GmbH
Medizintechnik
Balance Sheet as of July 31, 1997 4
Statement of Operations for the seven
months ended July 31, 1997 5
Audit Report of Wilhelm T. J. Hagen 6
Balance Sheet as of December 31, 1996 7
Statement of Operations for the year
ended December 31, 1997 8
Audit Report of Wilhelm T. J. Hagen 9
(b)(i) Pro Forma Financial Statements (the
Company, Equidyne and Dynamic)
Pro Forma Combined Condensed Financial
Statements 10
Pro Forma Combined Condensed Balance
Sheet as of April 30, 1998 11
Pro Forma Combined Condensed Statement
of Operations for the nine months ended
April 30, 1998 13
Pro Forma Combined Condensed Statement
of Operations for the year ended
July 31, 1997 14
(b)(ii) Pro Forma Financial Statements (the
Company and Rosch GmbH)
Pro Forma Combined Condensed Financial
Statements 15
2
<PAGE>
Pro Forma Combined Condensed Balance
Sheet as of October 31, 1997 16
Pro Forma Combined Condensed Statement
of Operations for the three months
ended October 31, 1997 17
Pro Forma Combined Condensed Statement
of Operations for the year ended July
31, 1997 18
Signature 19
3
<PAGE>
(a)(iii) Financial Statements of Rosch GmbH Medizintechnik.
ROSCH GMBH MEDIZINTECHNIK
BALANCE SHEET
(VALUES IN DEUTSCHE MARKS)
JULY 31, 1997
-------------
ASSETS
------
Current assets:
Cash & cash equivalents 114,428.91 DM
Accounts receivable 1,788,777.45
Inventories 1,807,507.00
------------
Total current assets 3,710,713.36
Property and equipment, net 387,889.61
Other assets 764,861.72
------------
Total assets 4,863,464.69 DM
============
LIABILITIES & STOCKHOLDERS' EQUITY
----------------------------------
Current liabilities:
Accounts payable 2,380,915.40 DM
Accrued liabilities 238,159.63
Other liabilities 483,874.86
------------
Total current liabilities 3,102,949.89
Long term debt 1,353,483.00
Stockholders' Equity:
Capital stock 50,000.00
Retained earnings 357,031.80
------------
Total stockholders' 407,031.80
equity
Total liabilities and stockholders' equity 4,863,464.69 DM
============
4
<PAGE>
ROSCH GMBH MEDIZINTECHNIK
STATEMENT OF OPERATIONS
(VALUES IN DEUTSCHE MARKS)
SEVEN MONTHS ENDED
JULY 31, 1997
------------------
Net sales 4,720,424.91DM
Cost of goods sold 3,111,813.11
----------------
Gross profit 1,608,611.80
Selling, general and
administrative 1,615,716.51
----------------
Total operating expense 1,615,716.51
Loss before taxes and interest (7,104.71)
Interest income/(expense) 71,510.73
Other income/(expense) (97,624.57)
----------------
Earnings after taxes and interest 19,009.13DM
================
5
<PAGE>
Audit Report
Rosch GmbH Medizintechnik
Berlin, Germany
I have examined the Annual Report, the Accounts and the
Administration by the General Manager for the period January 01,
1997 to July 31, 1997. The examination was carried out in
accordance with generally accepted auditing standards.
The Annual Report has been carried out in compliance with the
U.S. generally accepted accounting principles.
I recommend
that the Income Statement and the Balance Sheet be adopted
that the earnings be disposed of as proposed in the Report of the
General Manager
that the General Manager be discharged from liability for the
fiscal year January 01, 1997 to July 31, 1997.
Dessau, Germany, September 09, 1998
Wilhelm T. J. Hagen
[Seal of Wilhelm T. J. Hagen]
6
<PAGE>
ROSCH GMBH MEDIZINTECHNIK
BALANCE SHEET
(VALUES IN DEUTSCHE MARKS)
DECEMBER 31, 1996
-----------------
ASSETS
------
Current assets:
Cash & cash equivalents 56,616.87 DM
Accounts receivable 976,370.08
Inventories 1,240,317.16
------------
Total current assets 2,273,304.11
Property and equipment, net 382,043.00
Prepaid and other current
assets 205,488.20
------------
Total assets 2,860,835.31 DM
============
LIABILITIES & STOCKHOLDERS' EQUITY
----------------------------------
Current liabilities:
Accounts payable 929,165.61 DM
Accrued liabilities 413,013.31
Other liabilities 32,700.00
------------
Total current liabilities 1,374,878.92
Long term debt 843,864.60
Stockholders' Equity:
Capital stock 50,000,000
Shareholder credit 254,069.12
Retained earnings 338,022.67
------------
Total stockholders' equity 642,091.79
Total liabilities and stockholders' equity 2,860,835.31 DM
============
7
<PAGE>
ROSCH GMBH MEDIZINTECHNIK
STATEMENT OF OPERATIONS
(VALUES IN DEUTSCHE MARKS)
TWELVE MONTHS ENDED
DECEMBER 31, 1996
-------------------
Net sales 4,720,427.16 DM
Cost of goods sold 3,112,085.48
------------
Gross profit 1,608,341.68
Selling, general and administrative 1,604,227.87
------------
Total operating expense 1,604,227.87
Earnings before interest and taxes 4,113.81
Interest income/(expense) 71,510.73
Other income/(expense) (106,624.57)
Taxes 12,673.60
------------
Earnings after taxes and interest 26,554.05 DM
============
8
<PAGE>
Audit Report
Rosch GmbH Medizintechnik
Berlin, Germany
I have examined the Annual Report, the Accounts and the
Administration by the General Manager for the period January 01,
1996 to December 31, 1996. The examination was carried out in
accordance with generally accepted auditing standards.
The Annual Report has been carried out in compliance with the
U.S. generally accepted accounting principles.
I recommend
that the Income Statement and the Balance Sheet be adopted
that the earnings be disposed of as proposed in the Report of the
General Manager
that the General Manager be discharged from liability for the
fiscal year January 01, 1996 to December 31, 1996.
Dessau, Germany, September 09, 1998
Wilhelm T. J. Hagen
[Seal of Wilhelm T. J. Hagen]
9
<PAGE>
(b) Pro forma Financial Statements (Company, Equidyne Systems,
Incorporated and Dynamic Dental Systems, Inc.)
PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
The following unaudited historical and pro forma combined
condensed balance sheet as of April 30, 1998 and the unaudited
historical and combined condensed statements of earnings for the
nine months ended April 30, 1998 and the year ended July 31, 1997
for the following companies: American Electromedics Corp.,
Equidyne Systems, Inc. and Dynamic Dental Systems, Inc. The pro
forma combined condensed statements are presented under the
purchase method of accounting for business combinations. The
purchase method of accounting requires that all assets and
liabilities be adjusted to their estimated fair market value as
of the date of acquisition.
The pro forma statements are provided for informational purposes
only. The pro forma combined condensed statements of earnings
are not necessarily indicative of actual results that would have
been achieved had the acquisition been consummated at the
beginning of the periods presented, and is not indicative of
future results. The pro forma financial statements should be
read in conjunction with the audited financial statements and the
notes thereto of American Electromedics Corp., Equidyne Systems,
Inc. and Dynamic Dental Systems, Inc.
10
<PAGE>
PRO FORMA COMBINED CONDENSED BALANCE SHEET
APRIL 30, 1998
(THOUSANDS)
(UNAUDITED)
HISTORICAL
DYNAMIC HISTORICAL
HISTORICAL DENTAL EQUIDYNE PRO (1)(3)PRO
AMERICAN SYSTEMS, SYSTEMS, FORMA FORMA
ELECTROMEDICS INC. INC. ADJUSTMENTS COMBINED
------------- ---------- ---------- ----------- ---------
ASSETS
------
Cash $ 111 $ 52 $ 22 $ (370) $ (185)
Accounts
Receivable 1,242 100 1,342
Inventory, net
of reserve 2,704 131 2,835
Prepaid & Other
Current Assets 704 2 706
------ ------- ------ ------ -------
Total current
assets 4,761 283 24 (370) 4,698
Fixed Assets,
net 421 3 14 438
Goodwill and
patents 849 6,493 7,342
Investment in
Meditronic
GmbH 311 311
Other Assets 21 21
----- ----- ------ ------ -------
Total Assets $6,363 $286 $ 38 $6,123 $12,810
====== ===== ====== ====== =======
Liabilities and
---------------
Stockholder's
-------------
Equity
------
Accounts
Payable $ 923 $182 $121 $1,226
Accrued
Expenses and
other current
liabilities 469 193 159 821
Bank Line of
Credit 285 70 0 355
Current portion
of LTD 167 167
----- ----- ----- ----- -----
Total Current
Liabilities 1,844 445 280 2,569
Long-Term Debt 1,118 145 (2)(145) 1,118
Other Non
-Current
Liabilities 12 12
Common Stock 566 939 (804) 701
Additional
Paid-in
-Capital 5,682 5,575 11,257
Retained
Earnings
(Deficit) (2,752) (159) (1,338) 1,497 (2,752)
Cumulative
translation
adjustment (95) (95)
------ ------ ------ ----- ------
Total
Stockholder's
Equity 3,401 (159) (399) 6,268 9,111
------ ------ ------ ----- ------
Total
Liabilities
and
Stockholder's
Equity $6,363 $286 $ 38 $6,123 $12,810
====== ====== ====== ====== =======
1. Pro forma numbers include the following companies: American
Electromedics Corp. (the "Company"), Dynamic Dental Systems,
Inc. ("Dynamic") and Equidyne Systems, Inc. ("Equidyne").
These combined numbers are presented as though Dynamic and
Equidyne were acquired as of April 30, 1998.
2. Pay-off Equidyne notes payable at date of purchase.
3. The pro forma information above includes the results of the
Company, Dynamic and Equidyne combined with historical
results, the effects of the purchase accounting allocations
and adjustments to goodwill reflecting these changes. The
pro forma combined balance sheet as at April 30, 1998
includes the estimated fair value of assets acquired and
liabilities assumed in connection with the acquisitions of
Dynamic and Equidyne. The excess of the purchase price over
the fair value of all net assets acquired in 1998 was
approximately $6.5 million and is being amortized over 15
years.
11
<PAGE>
The following is a breakdown of the pro forma combined
goodwill at April 30, 1998:
Goodwill as reported on
Form 10-QSB at 04/30/98: $849,000
Dynamic Dental Systems, Inc.
----------------------------
Purchase Price $3,256,000 which consisted of $225,000 in cash
and 750,000 shares of the Company's
Common Stock, $.10 par value, at
$4.00 per share, plus acquisition
costs of $31,000.
Net liabilities
at 04/30/98 159,000
--------
Balance at
04/30/98: $3,415,000
Equidyne Systems, Inc.
----------------------
Purchase price: $2,679,000 which consisted of 600,000 shares of
the Company's Common Stock, $.10 par
value, at $4.375 per share plus
acquisitions costs of $54,000.
Net liabilities
at 04/30/98: 399,000
----------
Balance
at 04/30/98: $3,078,000
----------
Total Goodwill
at 04/30/98: $7,342,000
==========
12
<PAGE>
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
NINE MONTHS ENDED APRIL 30, 1998
(THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
HISTORICAL HISTORICAL HISTORICAL PRO (4)PRO
AMERICAN DYNAMIC EQUIDYNE FORMA FORMA
ELECTROMEDICS DENTAL SYSTEMS ADJUSTMENTS COMBINED
------------- ---------- ---------- ----------- --------
Net sales . $ 5,095 1,945 $ -- $ -- $ 7,040
Cost of
good
sold . . . 2,979 1,232 -- -- 4,211
-------- ------- ------- ------- ------
Gross
profit . . 2,116 713 -- -- 2,829
Operating
expense . 2,637 716 138 -- 3,491
Amorti-
zation
of
intan-
gibles . . -- -- -- (6) 325 325
-------- ------- ------- ------- -------
2,637 716 138 325 3,816
-------- ------- ------- ------- -------
Operating
(loss) . . (521) (3) (138) (325) (987)
Other
income
(expense) . (224) (2) (1) (5) 6 (221)
-------- ------- ------- ------- --------
Income
(loss)
before
provi-
sion
for
income
taxes . . (745) (5) (139) (319) (1,208)
Provision
for
income
taxes . . (2) -- -- -- (2)
-------- ------- ------- ------- -------
Net
income
(loss) . . $ (747) $ (5) $ (139) $ (319) $(1,210)
======== ======= ======= ====== =======
Loss per
share:
Basic . . . $ (.19) $ -- $ -- $ -- $ (.23)
======== ======= ======= ====== =======
Diluted . . $ (.19) $ -- $ -- $ -- $ (.23)
======== ======= ======= ====== =======
Shares used to
compute per
share amounts:
Basic . . . 4,002,804 -- -- -- 5,352,804
========= ======= ======= ====== =========
Diluted . . 4,002,804 -- -- -- 5,352,804
========= ======= ======= ====== =========
4. Pro forma numbers include the following companies: the
Company, Dynamic and Equidyne. These combined numbers
are presented as though Equidyne and Dynamic were
combined as of August 1, 1997.
5. Elimination of interest expense due to the assumed pay-
off of notes payable on Equidyne as of August 1, 1997.
6. Nine months amortization of goodwill.
13
<PAGE>
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED JULY 31, 1997
(THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
(10) (7)
HISTORICAL HISTORICAL HISTORICAL PRO PRO
AMERICAN DYNAMIC EQUIDYNE FORMA FORMA
ELECTROMEDICS DENTAL SYSTEMS ADJUSTMENTS COMBINED
------------- ------------ ---------- ----------- --------
Net sales . . $ 2,309 $ 329 $ -- $ -- $ 2,638
Cost of good
sold . . . . 1,311 232 -- -- 1,543
-------- ------ ------- ------ ------
Gross profit 998 97 -- -- 1,095
Operating
expense . . 1,479 91 17 -- 1,587
Amortization
of intangibles 49 -- -- (9) 433 482
-------- ------ ------- ------ ------
1,528 91 17 433 2,069
Operating
income
(loss) . . . (530) 6 (17) (433) (974)
Undistributed
earnings
(loss) of
affiliate . (57) -- -- -- (57)
Other income
(expense) . (339) 2 (3) (8) 3 (337)
-------- ------ ------- ------ ------
Income (loss)
before
provision
for income
taxes . . . (926) 8 (20) (430) (1,368)
Provision for
income taxes -- -- -- -- --
-------- ------ ------- ------ ------
Net income
(loss) . . . $ (926) $ 8 $ (20) $ (430) $ (1,368)
======== ====== ======= ======= =======
Loss per share:
Basic . . . . $ (.37) $ -- $ -- $ -- $ (.35)
======== ====== ======= ====== ======
Diluted . . . $ (.37) $ -- $ -- $ -- $ (.35)
======== ====== ======= ====== ======
Shares used to
compute per share
amounts:
Basic . . . . 2,553,136 -- -- -- 3,903,136
========= ====== ======= ====== =========
Diluted . . . 2,553,136 -- -- -- 3,903,136
========= ====== ======= ====== =========
7. Pro forma numbers include the following companies: the
Company, Dynamic and Equidyne. These combined numbers
are presented as though Dynamic and Equidyne were
acquired as of August 1, 1996.
8. Elimination of interest expense due to the assumed pay-
off of notes payable on Equidyne as of July 31, 1997.
9. Amortization of goodwill.
10. Dynamic began operations on January 1, 1997. These
amounts reflect seven months of activity.
14
<PAGE>
PRO FORMA COMBINED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
The following unaudited pro forma combined condensed balance
sheet as of October 31, 1997 and the unaudited combined condensed
statements of earnings for the three months ended October 31,
1997 and the year ended July 31, 1997 for the following
companies: American Electromedics Corp. (the "Company") and
Rosch GmbH Medizintechnik ("Rosch GmbH"). The pro forma combined
condensed statements are presented under the purchase method of
accounting for business combinations. The purchase method of
accounting requires that all assets and liabilities be adjusted
to their estimated fair market value as of the date of
acquisition.
The pro forma statements are provided for informational purposes
only. The pro forma combined condensed statements of earnings
are not necessarily indicative of actual results that would have
been achieved had the acquisition been consummated at the
beginning of the periods presented, and is not indicative of
future results. The pro forma financial statements should be
read in conjunction with the audited financial statements and the
notes thereto of Rosch GmbH and the Company
15
<PAGE>
PRO FORMA COMBINED CONDENSED BALANCE SHEET
OCTOBER 31, 1997
(THOUSANDS)
(UNAUDITED)
Pro Forma
American
Electromedics Pro Forma Pro Forma
(1) Adjustments Combined
------------- ----------- ---------
ASSETS
Current Assets:
Cash and cash equivalents $ 239 $ -- $ 239
Accounts receivable . . . 1,291 -- 1,291
Inventories . . . . . . . 1,471 -- 1,471
Other current assets . . 163 -- 163
------- ------- -------
Total current assets 3,164 -- 3,164
Depreciable assets, net . 263 -- 263
Intangible assets, net . 871 -- 871
Other . . . . . . . . . . 532 -- 532
------- ------- -------
Total assets . . . . $ 4,830 $ -- $ 4,830
======= ======= =======
LIABILITIES AND
STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable . . . . $ 1,014 $ -- $ 1,014
Bank line of credit . . . 300 -- 300
Accrued liabilities . . . 514 -- 514
Current portion of long-
term debt . . . . . . . . 152 -- 152
------- ------- -------
Total current
liabilities . . . . 1,980 -- 1,980
Long-term debt . . . . . 1,590 -- 1,590
Other liabilities . . . . -- -- --
Stockholders' equity:
Preferred stock . . . . -- -- --
Common stock . . . . . . 266 -- 266
Additional paid-in
capital . . . . . . . . 3,013 -- 3,013
Retained deficit . . . . (2,009) (2,009)
Foreign translation
adjustment . . . . . . . (10) -- (10)
------- ------- -------
Total stockholders'
equity . . . . . . 1,260 -- 1,260
------- ------- -------
Total liabilities and
stockholders' equity . . $ 4,830 $ -- $ 4,830
======= ======= =======
(1) Pro forma numbers include the following companies: the
Company and Rosch GmbH. These combined numbers are
presented as though Rosch GmbH was acquired on October 31,
1997.
16
<PAGE>
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
THREE MONTHS ENDED OCTOBER 31, 1997
(THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
Pro Forma
American Pro Forma Pro Forma
Electromedics(3) Adjustments Combined
---------------- ----------- --------
Net sales . . . . . . $ 1,830 $ -- $ 1,830
Cost of goods sold . 1,058 -- 1,058
-------- -------- --------
772 -- 772
Operating expense . . 687 -- 687
Amortization of
intangibles . . . . . 16 (4) 7 23
Operating income . . 69 0 62
Other income
(expenses) . . . . . (4) -- (4)
-------- -------- --------
Income before
provision for income
taxes . . . . . . . 65 (7) 58
Provisions for income
taxes . . . . . . . -- -- --
-------- -------- --------
Net income . . . . .
$ 65 (4) (7) $ 58
======== ======== ========
Earnings per share:
Basic . . . . . . . . $ .03 -- $ .03
======== ========
Diluted . . . . . . . $ .03 -- $ .03
======== ========
Shares used to compute
per share amounts:
Basic . . . . . . . . 2,658,136 -- 2,658,136
========= =========
Diluted . . . . . . . 2,658,136 -- 2,658,136
========= =========
(3) Pro forma numbers include the following companies: the
Company and Rosch GmbH. These combined numbers are
presented as though Rosch GmbH was acquired on August 1,
1996.
(4) Amortized three months of goodwill for investment in
affiliate with the assumption that Rosch GmbH was owned at
August 1, 1996.
17
<PAGE>
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
YEAR ENDED JULY 31, 1997
(THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
Pro Forma Pro
American Pro Forma Forma
Electromedics(5) Adjustments Combined
---------------- ----------- --------
Net sales . . . . . . $ 5,847 $ -- $ 5,847
Cost of goods sold . 3,340 -- 3,340
-------- -------- --------
2,507 -- 2,507
Operating expense . . 3,032 -- 3,032
Amortization of
intangibles . . . . 50 (6) (27) 77
Operating income
(loss) . . . . . . . (575) 0 (602)
Other income
(expenses) . . . . . (418) -- (418)
-------- -------- --------
Loss before provision
for income taxes . . (993) (27) (1,020)
Provisions for income
taxes . . . . . . . (26) -- (26)
-------- -------- --------
Net loss . . . . . . $ (1,019) $ (27) $ (1,046)
======== ========= ========
Loss per share:
Basic . . . . . . . . $ (.39) -- $ (.40)
========= =========
Diluted . . . . . . . $ (.39) -- $ (.40)
========= =========
Shares used to compute
per share amounts:
Basic . . . . . . . . 2,658,136 -- 2,658,136
========= =========
Diluted . . . . . . . 2,658,136 -- 2,658,136
========= =========
(5) Pro forma numbers for include the following companies: the
Company and Rosch GmbH. These combined numbers are
presented as though Rosch GmbH was acquired on August 1,
1996.
(6) Amortized three months of goodwill for investment in
affiliate with the assumption that Rosch GmbH was owned at
August 1, 1996.
18
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
American Electromedics Corp.
----------------------------
(Registrant)
By: /s/ Michael T. Pieniazek
---------------------------
Michael T. Pieniazek
President and Chief
Financial Officer
Dated: January 20, 1999
19
