UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[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
OR
[ ] 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: 0-11635
LASER PHOTONICS, INC.
---------------------
(Exact name of registrant as specified in its charter)
Delaware 59-2058100
-------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Five Radnor Corporate Center, Suite 470, Radnor, Pennsylvania 19087
-------------------------------------------------------------------
(Address of principal executive offices, including zip code)
(610) 971-9292
--------------
(Registrant's telephone number, including area code)
2431 Impala Drive, Carlsbad, California 92008
---------------------------------------------
(Former address since last report)
Indicated by check mark whether the registrant: (i) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (ii) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
The number of shares outstanding of the issuer's Common Stock as of May 15,
2000, was 15,345,323 shares.
<PAGE>
PART I - FINANCIAL STATEMENTS
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
LASER PHOTONICS, INC. AND SUBSIDIARIES
--------------------------------------
CONSOLIDATED BALANCE SHEETS
---------------------------
(Unaudited)
-----------
<CAPTION>
March 31, December 31,
ASSETS 2000 1999
------ ------------- -------------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 14,855,602 $ 4,535,557
Inventories 1,238,788 1,170,472
Prepaid expenses and other current assets 117,946 34,685
------------- -------------
Total current assets 16,212,336 5,740,714
PROPERTY AND EQUIPMENT, net 201,486 152,965
PATENT COSTS, net of accumulated amortization of $42,759
and $40,671 42,039 44,127
LICENSE FEE, net of accumulated amortization of
$1,166,667 and $1,041,667 2,833,333 2,958,333
OTHER ASSETS 127,447 45,346
NET ASSETS OF DISCONTINUED OPERATIONS 538,668 764,179
------------- -------------
$ 19,955,309 $ 9,705,664
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
Current portion of notes payable and long term debt $ 95,844 $ 353,710
Accounts payable 1,033,558 2,034,371
Accrued payroll and related expenses 140,879 376,967
Other accrued liabilities 463,977 1,372,668
Deferred revenues 250,000 250,000
------------- -------------
Total current liabilities 1,984,258 4,387,716
------------- -------------
NOTES PAYABLE AND LONG TERM DEBT 34,087 43,620
------------- -------------
STOCKHOLDERS' EQUITY:
Common Stock, $.01 par value, 25,000,000 shares authorized,
15,112,804 and 13,267,918 shares issued and outstanding as
of March 31, 2000 and December 31, 1999, respectively 151,128 132,679
Additional paid in capital 46,513,064 30,759,186
Accumulated deficit (28,727,228) (25,617,537)
------------- -------------
Total stockholders' equity 17,936,964 5,274,328
------------- -------------
$ 19,955,309 $ 9,705,664
============= =============
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE>
<TABLE>
LASER PHOTONICS, INC. AND SUBSIDIARIES
-------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
-------------------------------------
(Unaudited)
-----------
<CAPTION>
Three Months Ended
March 31,
-------------------------------
2000 1999
-------------- --------------
<S> <C> <C
COSTS AND EXPENSES:
Selling, general and administrative 2,312,170 402,046
Research and development 699,697 125,427
Depreciation and amortization 137,840 264,569
-------------- --------------
Loss from continuing operations before interest and
other (expense) income, net (3,149,707) (792,042)
INTEREST (EXPENSE) INCOME, net 72,247 (1,541,546)
OTHER (EXPENSE) INCOME, net 316,345 (443)
-------------- --------------
Loss from continuing operations (2,761,115) (2,334,031)
Loss from discontinued operations (348,576) (177,165)
-------------- --------------
Net loss $ (3,109,691) $ (2,511,196)
============== ==============
BASIC AND DILUTED LOSS PER SHARE:
Continuing operations $ (0.20) $ (0.23)
Discontinued operations (0.03) (0.02)
-------------- --------------
Basic and diluted net loss per share $ (0.23) $ (0.25)
============== ==============
SHARES USED IN COMPUTING BASIC AND DILUTED NET LOSS PER SHARE 13,593,171 9,895,684
============== ==============
</TABLE>
The accompanying notes are an integral part of these statements.
4
<PAGE>
<TABLE>
LASER PHOTONICS, INC.
---------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS
-------------------------------------
(Unaudited)
-----------
<CAPTION>
Three Months Ended
March 31
------------------------------------
2000 1999
---------------- ----------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net loss $ (3,109,691) $ (2,511,196)
Adjustments to reconcile net loss to net cash
used in operating activities-
Depreciation and amortization 154,473 272,138
Stock options issued to consultants for services 190,381 -
Acceleration of options issued to employees 47,500 -
Acceleration of options issued to consultants 808,766 -
Interest related to beneficial conversion feature - 1,512,292
Changes in assets and liabilities-
(Increase) decrease in current assets 73,934 (98,255)
(Decrease) in current liabilities (2,227,693) (146,796)
---------------- ----------------
Net cash used in operating activities (4,062,330) (971,817)
---------------- ----------------
INVESTING ACTIVITIES:
Purchases of property and equipment (75,906) (10,151)
---------------- ----------------
Net cash used in investing activities (75,906) (10,151)
---------------- ----------------
FINANCING ACTIVITIES:
Principal payments on debt (267,399) (141,449)
Payments on payable to related party - (7,380)
Payment for debt and warrant issuance costs - (166,600)
Proceeds from exercise of options 166,312 -
Proceeds from exercise of warrants 220,627 -
Proceeds from issuance of convertible notes payable and warrants - 2,380,000
Proceeds from other notes payable - 159,226
Proceeds from issuance of Common Stock, net 14,338,741 -
---------------- ----------------
Net cash provided by financing activities 14,458,281 2,223,797
---------------- ----------------
NET INCREASE IN CASH AND CASH EQUIVALENTS 10,320,045 1,241,829
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 4,535,557 174,468
---------------- ----------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 14,855,602 $ 1,416,297
================ ================
</TABLE>
The accompanying notes are an integral part of these statements.
5
<PAGE>
LASER PHOTONICS, INC. AND SUBSIDIARIES
--------------------------------------
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
1. THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
-----------------------------------------------------------
THE COMPANY:
Background
- ----------
Laser Photonics, Inc. and subsidiaries (the "Company") is principally engaged in
the development, manufacture and marketing of laser systems and accessories for
medical applications and, through its approximately 76.1% owned subsidiary,
AccuLase, Inc., is developing excimer laser equipment and techniques directed
toward the treatment of coronary heart disease and psoriasis.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Quarterly Financial Information and Results of Operations
- ---------------------------------------------------------
The financial statements as of March 31, 2000 and for the three months ended
March 31, 2000 and 1999, are unaudited and, in the opinion of management,
include all adjustments (consisting only of normal recurring adjustments)
necessary to present fairly the financial position as of March 31, 2000, and the
results of operations and cash flows for the three months ended March 31, 2000
and 1999. The results for the three months ended March 31, 2000 are not
necessarily indicative of the results to be expected for the entire year. While
the Company believes that the disclosures presented are adequate to make the
information not misleading, these consolidated financial statements should be
read in conjunction with the consolidated financial statements and the notes
included in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1999.
Principles of Consolidation
- ---------------------------
The consolidated financial statements include the accounts of the Company and
its subsidiaries. All significant intercompany accounts and transactions have
been eliminated.
6
<PAGE>
Management's Use of Estimates
- -----------------------------
The preparation of the consolidated financial statements in conformity with
generally accepted accounting principles requires the Company's 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 financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
Cash and Cash Equivalents
- -------------------------
For the purposes of the consolidated statements of cash flows, the Company
considers investment instruments with an original maturity of three months or
less to be cash equivalents. Cash equivalents are primarily comprised of
investments in various money market funds.
Inventories
- -----------
Inventories are stated at the lower of cost or market, determined by the
first-in, first-out method and consist of the following:
March 31, December 31,
2000 1999
------------- -------------
Raw materials $ 462,642 $ 613,032
Work-in-process 311,390 557,440
Finished goods 464,756 -
------------- -------------
$ 1,238,788 $ 1,170,472
============= =============
Property and Equipment
- ----------------------
Property and equipment are stated at cost. Depreciation is calculated on a
straight-line basis over the estimated useful lives of the assets, which range
from 3 to 7 years. Improvements and betterments are capitalized, and maintenance
and repair costs are charged to expense as incurred. Upon retirement or
disposition, the applicable property amounts are relieved from the accounts and
any gain or loss is recorded in the consolidated statement of operations.
Intangible Assets
- -----------------
Intangible assets consist of patents and license fees which are carried at cost
less accumulated amortization. Patents and license fees are amortized on a
straight-line basis over the estimated useful lives of the asset, which is 8 to
12 years for patents and eight years for prepaid license fees.
The Company evaluates the realizability of intangible assets based on estimates
of undiscounted future cash flows over the remaining useful life of the asset.
If the amount of such estimated undiscounted future cash flows is less than the
net book value of the asset, the asset is written down to its net realizable
value. As of March 31, 2000, no such write-down was required.
7
<PAGE>
Revenue Recognition
- -------------------
Revenues are recognized upon shipment of products to customers. Deferred revenue
relates to customer payments received in advance of the delivery of the related
products.
Loss Per Share
- --------------
The Company computes loss per share in accordance with Statement of Financial
Accounting Standards ("SFAS") No. 128, "Earnings per Share. SFAS No. 128
requires dual presentation of basic and diluted earnings (loss) per share for
complex capital structures on the face of the statements of operations.
According to SFAS No. 128, basic earnings (loss) per share is calculated by
dividing net income (loss) available to common stockholders by the weighted
average number of common shares outstanding for the period. Diluted earnings
(loss) per share reflects the potential dilution from the exercise or conversion
of securities into common stock, such as stock options.
Diluted net loss per share is the same as basic net loss per share as no
additional shares for the potential dilution from the exercise of securities
into common stock are included in the denominator as the result is anti-dilutive
due to the Company's losses.
Reclassifications
- -----------------
The consolidated financial statements for prior periods have been reclassified
to conform with the current period's presentation.
New Accounting Pronouncements
- -----------------------------
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities". This statement establishes accounting and
reporting standards for derivative instruments, including certain derivative
instruments embedded in other contacts and for hedging activities and is
effective for all fiscal years beginning after June 15, 2000. Management
believes that the adoption of SFAS No. 133 will have no impact on its operating
results or financial position.
In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101, "Revenue Recognition in Financial Statements" ("SAB No. 101").
SAB No. 101 summarizes certain of the Staff's views in applying generally
accepted accounting principles to recognition, presentation and disclosure of
revenue in financial statements. Compliance with SAB No. 101 is required no
later than the first quarter of the fiscal years beginning after December 15,
1999. The Company has determined that its accounting policies for revenue
recognition are in compliance with the provisions of SAB No. 101.
8
<PAGE>
2. PRIVATE STOCK OFFERING:
-----------------------
In March 2000, the Company completed a private offering of 1,409,092 shares of
common stock at $11.00 per share. The Company received net cash proceeds of
$14,338,741 from this private offering.
3. DISCONTINUED OPERATIONS:
------------------------
Due to the limited financial resources of the Company, the Company's business
strategy changed in 1997 to focus its efforts on excimer laser technology in
order to develop excimer laser and excimer laser delivery products for medical
applications.
To facilitate the Company's focus on excimer laser technology, as of May 4,
2000, the Company has sold its non-excimer laser businesses, which were located
at its Orlando, Florida and Wilmington, Massachusetts facilities.
The Company closed a transaction with respect to the sale of certain assets,
including certain patents related to non-excimer lasers, related to the
Company's Florida business operations, to Lastec, for a purchase price of
$375,000. Lastec is unaffiliated with the Company. Lastec has paid the Company a
deposit of $37,500, and has executed a secured promissory note in the principal
amount of $337,500, payable in three (3) installments, as follows: (i) $37,500
due on or before May 20, 2000, (ii) $100,000 due on or before July 14, 2000, and
(iii) the balance plus accrued interest due on or before October 6, 2000. The
promissory note accrues interest at the rate of 8% per annum. The promissory
note is secured by the assets assigned by the Company to Lastec in connection
with the transaction, and is personally guaranteed by the principals of Lastec.
As of the date of this filing, a significant portion of the debts related to
these operations have been paid from the proceeds of the August 9, 1999 private
placement and the March 16, 2000 private placement and the sale of certain
assets related to the Company's non-excimer laser operations. In March 2000, the
Company paid $950,000 in cash to the landlord for the Florida lease in
connection with the satisfaction of a judgment and settlement of certain claims
against the Company in the aggregate amount of $1,114,000. These amounts were
previously accrued.
The Company closed the transaction with respect to the sale of certain assets
and the grant of an exclusive license for certain patents related to non-excimer
lasers related to the Company's Massachusetts business operations to Laser
Components, for a purchase price of $213,000. Laser Components is unaffiliated
with the Company. In addition, Laser Components assumed the Company's
prospective obligations under the Company's Massachusetts office lease.
Accordingly, these two operations are being accounted for together as discounted
operations with a measurement date of May 4, 2000. The accompanying consolidated
financial statements reflect the operating results and balance sheet items of
the discontinued operations separately from continuing operations. The Company
expects to report a gain on the sale of these discontinued operations in the
quarter ending June 30, 2000. Prior periods have been restated.
9
<PAGE>
Revenues and loss from discontinued operations on the accompanying consolidated
statement of operations were:
Three Months Ended
March 31,
--------------------------------
2000 1999
------------- -------------
Revenues $ 180,278 $ 347,010
============= =============
Loss $ (348,576) $ (177,165)
============= =============
The assets and liabilities of these operations have been reclassified on the
accompanying consolidated balance sheets to separately identify them as net
assets of discontinued operations. A summary of these net assets is as follows:
March 31, December 31,
2000 1999
------------- -------------
Accounts receivable, net $ 17,934 $ 176,179
Inventories 390,576 428,415
Prepaid expenses and other
current assets 15,375 19,800
Property and equipment, net 114,783 139,785
------------- -------------
$ 538,668 $ 764,179
============= =============
10
<PAGE>
4. NOTES PAYABLE AND LONG-TERM DEBT:
---------------------------------
<TABLE>
Notes payable and long-term debt consists of the following:
<CAPTION>
March 31, December 31,
2000 1999
------------- -------------
<S> <C> <C>
Notes payable - unsecured creditors, interest at
prime rate, quarterly interest only payments
beginning October 1, 1995, principal due October 1,
1995, unsecured. Settled in March 2000. $ -- $ 165,298
Note payable - creditor, interest at 10%, monthly
interest only payments through May 5, 1997,
thereafter monthly interest and principal payments
of $6,384 through May 1999, unsecured. Settled in
March 2000. -- 127,860
Note payable - U.S. Treasury, interest at 9%, payable
in monthly principal and interest installments
through July 2000. Settled in March 2000. -- 14,873
Notes payable - various creditors, interest at 9%,
payable in various monthly principal and interest
installments through July 2000. Settled in March 2000. -- 10,101
Note payable - creditor, interest at 9%, payable in
monthly principal and interest installments of
$1,258 through January 2001, collateralized by
personal property of the Company. Settled in March 2000. -- 16,670
Note payable - lessor, interest at 10% payable in
monthly principal and interest installments of
$1,775 through December 31, 2002, unsecured. 51,037 55,021
Note payable - creditor, interest at 13.5%, payable in
monthly principal and interest installments of
$1,552 through May 2000. Settled in March 2000. -- 7,507
Note payable - unsecured creditors, interest at 8.3%,
payable in monthly principal and interest installments
of $9,480 through November 2000. 78,894 -
------------- -------------
129,931 397,330
Less-current maturities (95,844) (353,710)
------------- -------------
$ 34,087 $ 43,620
============= =============
</TABLE>
11
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
THIS QUARTERLY REPORT ON FORM 10-Q (THE "REPORT"), INCLUDING THE
DISCLOSURES BELOW, CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS THAT INVOLVE
SUBSTANTIAL RISKS AND UNCERTAINTIES. WHEN USED HEREIN, THE TERMS "ANTICIPATES,"
"EXPECTS," "ESTIMATES," "BELIEVES" AND SIMILAR EXPRESSIONS, AS THEY RELATE TO
THE COMPANY OR ITS MANAGEMENT, ARE INTENDED TO IDENTIFY SUCH FORWARD-LOOKING
STATEMENTS. FORWARD-LOOKING STATEMENTS IN THIS REPORT OR HEREAFTER INCLUDED IN
OTHER PUBLICLY AVAILABLE DOCUMENTS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION"), REPORTS TO THE STOCKHOLDERS OF LASER PHOTONICS,
INC., A DELAWARE CORPORATION (THE "COMPANY") AND OTHER PUBLICLY AVAILABLE
STATEMENTS ISSUED OR RELEASED BY THE COMPANY INVOLVE KNOWN AND UNKNOWN RISKS,
UNCERTAINTIES AND OTHER FACTORS WHICH COULD CAUSE THE COMPANY'S ACTUAL RESULTS,
PERFORMANCE (FINANCIAL OR OPERATING) OR ACHIEVEMENTS TO DIFFER FROM THE FUTURE
RESULTS, PERFORMANCE (FINANCIAL OR OPERATING) OR ACHIEVEMENTS EXPRESSED OR
IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. SUCH FUTURE RESULTS ARE BASED UPON
MANAGEMENT'S BEST ESTIMATES BASED UPON CURRENT CONDITIONS AND THE MOST RECENT
RESULTS OF OPERATIONS. THESE RISKS INCLUDE, BUT ARE NOT LIMITED TO, THE RISKS
SET FORTH HEREIN AND IN SUCH OTHER DOCUMENTS FILED WITH THE COMMISSION, EACH OF
WHICH COULD ADVERSELY AFFECT THE COMPANY'S BUSINESS AND THE ACCURACY OF THE
FORWARD-LOOKING STATEMENTS CONTAINED HEREIN. THE COMPANY'S ACTUAL RESULTS,
PERFORMANCE OR ACHIEVEMENTS MAY DIFFER MATERIALLY FROM THOSE EXPRESSED OR
IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS.
THE FOLLOWING DISCUSSION AND ANALYSIS SHOULD BE READ IN CONJUNCTION
WITH THE CONSOLIDATED FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE
IN THIS REPORT.
OVERVIEW OF BUSINESS OPERATIONS
The Company is engaged in the development, manufacturing and marketing
of proprietary excimer laser and fiber optic equipment and techniques directed
toward the treatment of psoriasis and cardiovascular and vascular disease. The
Company anticipates developing such equipment and technologies to treat other
medical problems. However, no assurance to this effect can be given.
The Company's former business strategy consisted of the development of
a wide range of laser products using different solid-state lasers. Between 1986
and the date of this Report, the Company sold over 1,000 lasers, usually on a
private label basis, to other manufacturers. The Company also considered
pursuing a strategy of using its excimer laser technology for a photolithography
product, which was abandoned. The Company's former strategies proved to be
unsuccessful, in the opinion of then current management of the Company. Although
the Company generated revenues from the sale of its products, former management
believed that the Company would never be able to operate profitably in the
markets where the Company was then doing business. The Company currently
believes that its excimer laser technology provides the basis for reliable
cost-effective systems that will increasingly be used in connection with a
variety of applications. Accordingly, the Company has discontinued its business
operations related to the Company's former business strategy and is focused
solely on excimer laser products for various medical applications.
On May 13, 1994, the Company filed a Petition for Reorganization (the
"Bankruptcy Proceeding") under Chapter 11 of the Federal Bankruptcy Act on May
13, 1994, Case No. 94-02608-611-Federal Bankruptcy Court-Middle District,
Florida (the "Bankruptcy Court"). An order was issued on May 22, 1995,
confirming the Company's Third Amended Plan of Reorganization (the "Bankruptcy
Reorganization" or the "Plan"). The Company was subsequently authorized to
conduct its business operations as a debtor-in-possession subject to the
jurisdiction of the Bankruptcy Court. On May 22, 1995, the Company's Plan was
confirmed by the Bankruptcy Court. The implementation of the terms of the Plan
resulted in the Company's adoption of "fresh start" accounting. The Plan
provided, that in exchange for the forgiveness of certain unsecured debt, the
Company issued to unsecured creditors shares of the Company's Common Stock such
that, following the issuance of all Common Stock to be issued under the Plan,
the unsecured creditors owned 1,000,000 shares of the Company's Common Stock,
representing 20% of the issued and outstanding Common Stock of the Company. The
7,500,000 shares of Common Stock of the Company's prior existing stockholders
were canceled and reissued into 250,000 shares of Common Stock, which
represented 5% of the then total issued and outstanding shares of Common Stock.
The Plan further provided that Helionetics, Inc. ("Helionetics"), a
former principal stockholder of the Company, transfer to the Company 76.1% of
the common stock of Acculase, Inc. ("Acculase"), the Company's principal
operating subsidiary. Further, during the pendency of the Bankruptcy Proceeding,
Helionetics contributed $1,000,000 in cash to the Company, which funds were
utilized for cash payments under the Plan, and Helionetics loaned the Company
12
<PAGE>
$300,000 to fund the cost of research and development of the Company's excimer
lasers, which loan has been repaid. Under the Plan, Helionetics received
3,750,000 shares of Common Stock of the Company, which represented 75% of the
then total issued and outstanding shares of Common Stock.
During April, 1997, Helionetics filed a voluntary petition of
reorganization ("Helionetics Reorganization") with the United States Bankruptcy
Court in the Central District of California for protection under Chapter 11 of
Title 11 of the United States Bankruptcy Code. As a result, the Company wrote
off its $662,775 receivable from Helionetics as of December 31, 1996. In
connection with the Helionetics Reorganization (defined below), Helionetics
disposed of all of its holdings of the Company's Common Stock. No persons who
were stockholders of the Company immediately before the reorganization have at
present any controlling interest in the Company. On September 30, 1997,
Pennsylvania Merchant Group ("PMG"), the Company's then existing investment
banker, purchased from the Helionetics bankruptcy estate, a note payable from
Acculase to Helionetics in the amount of $2,159,708, including accrued interest.
During October, 1997, PMG sold the note to the Company for 800,000 shares of
Common Stock.
Acculase was formed in 1985 for the purpose of commercializing
products that utilize its proprietary excimer laser and fiber optic
technologies. Acculase has focused primarily on the development of medical
products for the treatment of coronary heart disease.
The Acculase excimer laser power source was developed to perform a
variety of material processing applications. The Acculase overall system,
designated the pulsed excimer laser, was developed for microsurgical
applications. The first medical application of the overall system, designated
the excimer laser system, was approved by the United States Food and Drug
Administration (the "FDA") under Investigational Device Exemption ("IDE") No.
G920163, for use in the treatment of occlusive coronary artery disease, as an
adjunct to coronary artery bypass graft ("CABG") surgery. Acculase chose not to
pursue completion of such IDE due to the lack of funds to pay the costs of, and
to recruit patients into, the necessary studies.
In connection with the Company's current business plan, the Company's
initial medical applications for its excimer laser technology are intended to be
used in the treatment of psoriasis and cardiovascular disease.
Between March, 1998 and November, 1999, the Company entered into five
(5) clinical trial agreements (collectively, the "Clinical Trial Agreement")
with Massachusetts General Hospital ("MGH") to compare the effect of excimer
laser light using its excimer laser technology to the current Ultraviolet "B"
("UVB") treatment being used to treat psoriasis and other skin disorders. The
Company provided prototype laser equipment for pre-clinical dose response
studies. The Company has agreed to support the clinical trials with research
grants of approximately $660,000, of which $448,000 has been paid, as of the
date of this Report. The final data from the first of these clinical trial
agreements was collected in December, 1998, and formed the basis for a 510(k)
submission to the FDA on August 4, 1999. The four remaining studies are ongoing
and have not been completed as of the date of this Report. On January 27, 2000,
FDA issued a 510(k) to the Company, establishing that the Company's excimer
laser psoriasis system has been determined to be substantially equivalent to
currently marketed devices for the treatment of psoriasis. The Company
introduced its psoriasis products for the purposes of commercial application
testing in March, 2000, and intends to distribute the psoriasis treatment system
for commercial use in July, 2000. As of the date of this Report, the Company has
generated no revenues from the psoriasis treatment system.
In connection with the cardiovascular and vascular uses of the
Company's excimer laser technology, on August 19, 1997, Acculase and Baxter
Healthcare Corporation ("Baxter") entered into a strategic alliance (the "Baxter
Agreement") for the manufacture and marketing of excimer laser products for an
experimental procedure known as Transmyocardial Revasculization ("TMR").
Acculase granted to Baxter an exclusive worldwide right and license to
manufacture and sell the Company's excimer laser technology products relating to
the treatment of cardiovascular and vascular disease and the disposable products
associated therewith (the "TMR System"). The Company agreed to manufacture the
TMR System to the specifications of Baxter at a schedule of prices, based upon
the volume of TMR Systems purchased by Baxter from the Company.
The Company recognized revenue of $1,718,000 from Baxter, which was
equal to 23% of gross revenues for the three-year period ended December 31,
1999. No single customer, other than Baxter, accounted for sales in excess of
10% in 1999.
13
<PAGE>
DISCONTINUED OPERATIONS
To facilitate the Company's focus on excimer laser technology, the
Company has sold certain of its non-excimer laser assets, which are related to
its business operations at its Orlando, Florida and Wilmington, Massachusetts
facilities. As of May 4, 2000, the Company closed the transactions with respect
to the sale of certain assets, including certain patents related to non-excimer
lasers related to the Company's Florida business operations, to Lastec, Inc.
("Lastec"), for a purchase price of $375,000. Lastec is unaffiliated with the
Company. The Company has discontinued its Florida operations. Lastec has paid
the Company a deposit of $37,500, and has executed a secured promissory note in
the principal amount of $337,500, payable in three (3) installments, as follows:
(i) $37,500 due on or before May 20, 2000, (ii) $100,000 due on or before July
14, 2000, and (iii) the balance plus accrued interest due on or before October
6, 2000. The promissory note accrues interest at the rate of 8% per annum. The
promissory note is secured by the assets assigned by the Company to Lastec in
connection with the transaction, and is guaranteed by John Yorke and Raymond
Thompson, who are principals of Lastec. As of April 7, 2000, a significant
portion of the debts related to these operations have been paid from the
proceeds of a financing completed on August 9, 1999 resulting in gross proceeds
of $9,310,374 to the Company and a financing completed on March 16, 2000 (the
"March 16, 2000 Financing") resulting in net proceeds of approximately
$14,300,000 to the Company and the sale of certain assets related to the
Company's non-excimer laser operations. In March 2000, the Company paid
$950,000 in cash to the landlord for the Florida lease in connection with the
satisfaction of a judgment and settlement of certain claims against the Company
in the aggregate amount of $1,114,000. These amounts were previously accrued.
Further, the Company closed the transactions with respect to the sale of certain
assets and the grant of an exclusive license for certain patents related to
non-excimer lasers related to the Company's Massachusetts business operations to
Laser Components GmbH ("Laser Components"), for a purchase price of $213,000.
Laser Components is unaffiliated with the Company. In addition, Laser Components
assumed the Company's prospective obligations under the Company's Massachusetts
office lease. The Company has discontinued its Massachusetts operations.
Accordingly, the former operations at the Company's Florida and
Massachusetts facilities are being accounted in the Company's Consolidated
Financial Statements included elsewhere in this Report as "discontinued
operations," with a measurement date of May 4, 2000. The Consolidated Financial
Statements reflect the operating results and balance sheet items of the
discontinued operations separately from continuing operations. The Company
expects to report a gain of the sale of these discontinued operations in the
quarter ending June 30, 2000.
Management's decision to suspend these business operations is
consistent with the Company's new business strategy and has resulted in the
discontinuance of business operations, which generated approximately 76% of the
Company's revenues for 1998 and 1999. Revenues from discontinued operations
during the three (3) months ended March 31, 2000 and 1999 were $180,278 and
$347,010, respectively. Loss from discontinued operations during the three (3)
months ended March 31, 2000 and 1999 were $348,576 and $177,165 respectively. At
March 31, 2000 and December 31, 1999, net assets of the discontinued operations
were $538,668 and $764,179, respectively.
BASIS FOR PREPARATION OF FINANCIAL STATEMENTS
The consolidated financial statements filed elsewhere herein have been
prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business, and, where
applicable, in conformity with Statement of Position 90-7, "Financial Reporting
by Entities in Reorganization under the Bankruptcy Code," issued in November,
1990, by the American Institute of Certified Public Accountants ("SOP 90-7").
Under the provisions of SOP 90-7 and in connection with the
confirmation of the Bankruptcy Reorganization on May 22, 1995, the Company was
required to adopt fresh start reporting as of May 23, 1995, since the
reorganization value (approximate fair value at the date of reorganization) was
less than the total of all post-petition liabilities and allowed claims, and
holders of existing voting shares before May 23, 1995 received less than 50% of
the voting shares of the emerging entity. Accordingly, the consolidated
statements of operations for the period from January 1, 1995 to May 22, 1995
reflects the effects of the forgiveness of debt resulting from the confirmation
of the Bankruptcy Reorganization and the adjustments to restate assets and
liabilities to reflect the reorganization value.
14
<PAGE>
In adopting fresh start reporting, the Company was required to
determine its reorganization value, which represented the fair value of the
Company before considering liabilities and the approximate amount a willing
buyer would pay for the assets of the Company immediately after the Bankruptcy
Reorganization. The reorganization value was based upon the consideration given
by Helionetics to acquire a 75% interest in the Company. The purchase price of
$1,894,122 was determined based upon cash paid and the carrying value of the
76.1% interest in Acculase previously owned by Helionetics, which was
transferred to the Company in connection with the Bankruptcy Reorganization.
All assets and liabilities were restated to reflect their
reorganization value in accordance with procedures specified in Accounting
Principles Board Opinion 16 "Business Combinations," as required by SOP 90-7.
The portion of the reorganization value that could not be attributed to specific
tangible or identified intangible assets was classified as reorganization value
in excess of amounts allocable to identifiable assets ("Reorganization
Goodwill") and was being amortized over five years. Because of the magnitude of
the Company's losses since emerging from the Bankruptcy Reorganization, the
balance of the Reorganization Goodwill was written off as of December 31, 1996.
In addition, the accumulated deficit of the Company was eliminated, and
its capital structure was recast in conformity with the Bankruptcy
Reorganization.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
The Company did not generate any revenues from its continuing
operations during the three (3) months ended March 31, 2000 and 1999.
Selling, general and administrative expenses during the three (3)
months ended March 31, 2000 increased to $2,312,170 from $402,046 during the
three (3) months ended March 31, 1999. Included in selling, general and
administrative expenses for the three (3) months ended March 31, 2000 were
$808,766 related to a charge associated with the acceleration of vesting of
certain options granted to the Chairman of the Company's Scientific Advisory
Board. Excluding this charge, the increase primarily relates to the Company's
building of its infrastructure to enable the Company to implement its business
plan to commercialize its psoriasis laser treatment system, which is anticipated
to be introduced into the market in July, 2000. Specifically, these increases
from 1999 included increases in consulting and professional fees related to
marketing expenses with respect to the Company's excimer laser systems,
increased salaries and related costs associated with the Company's newly
retained executive officers, increased personnel and overhead expenses with
respect to the infrastructure, which the Company is building to commercialize
its excimer laser operations.
Research and development during the three (3) months ended March 31,
2000 increased to $699,697 from $125,427 during the three (3) months ended March
31, 1999. This increase primarily related to the increased amount of funds
available for research expenses during 2000. Research and development expenses
in the three (3) months ended March 31, 2000 primarily related to the
development of the Company's excimer laser systems for its psoriasis and TMR
products. Research and development expenses in the three (3) months ended March
31, 1999 primarily related to the development of the Company's psoriasis laser
systems and also included expenses related to additional testing to meet CE Mark
and Underwriter's Laboratory ("UL") standards for the Company's excimer lasers.
Depreciation and amortization during the three (3) months ended March
31, 2000 decreased to $137,840 from $264,569 during the three (3) months ended
March 31, 1999. These amounts primarily related to the amortization of the
license fee from Baxter and the depreciation of equipment acquired in 1998. The
1999 amount also includes amortization of goodwill from the acquisition of
Acculase.
Interest income during the three (3) months ended March 31, 2000 was
$72,247, as compared to interest expense during the three (3) months ended March
31, 1999 of $1,541,546. Interest income during the three (3) months ended March
31, 2000 primarily related to interest earned on invested cash balances from the
proceeds of private placements of the Company's securities. Interest expense
during the three (3) months ended March 31, 1999 primarily related to interest
charges associated with the recognition of a beneficial conversion feature on
certain of its then outstanding convertible notes payable (the "Convertible
Notes").
Other income during the three (3) months ended March 31, 2000 was
$316,345, as compared to other expense of $443 during the three (3) months ended
March 31, 1999. Other income for the three (3) months ended March 31, 2000
primarily related to the forgiveness of certain payables by certain of the
Company's creditors.
15
<PAGE>
As a result of the foregoing, the Company incurred a net loss of
$3,109,691 during the three (3) months ended March 31, 2000, as compared to a
net loss of $2,511,196 during the three (3) months ended March 31, 1999. The
Company incurred a net loss from continuing operations of $2,761,115 during the
three (3) months ended March 31, 2000, as compared to a net loss from continuing
operations of $2,334,031 during the three (3) months ended March 31, 1999.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 2000, the ratio of current assets to current liabilities
was 8.2 to 1.00 compared to 1.3 to 1.00 at December 31, 1999. The Company had
$14,228,078 of working capital, as of March 31, 2000.
The Company has historically financed its operations through the use of
working capital provided from loans and equity and debt financing.
Due to the limited financial resources of the Company, the Company's
strategy changed in 1997 to focus its efforts on the Company's excimer laser
technology and expertise in order to develop a broad base of excimer laser and
excimer laser delivery products for both medical and non-medical applications.
From September, 1997 through March, 2000, the Company issued certain
securities, including shares of Common Stock and other derivative securities
convertible or exercisable into shares of Common Stock, in order to finance the
Company's business operations. All of the shares of Common Stock and the shares
of Common Stock underlying such derivative securities have been registered in a
registration statement dated May 12, 2000.
As of March 16, 2000, the Company completed the March 16, 2000
Financing to ten (10) institutional investors of an aggregate of 1,409,092
shares of Common Stock at a purchase price of $11.00 per share, resulting in
aggregate gross proceeds to the Company of approximately $15,500,000. The market
price of the Common Stock on the date that the transaction was negotiated was
$13.50 and on the closing date of the transaction was approximately $15.88. The
Company paid ING Barings LLC a commission of 6% of the gross proceeds, or
approximately $930,000. The Company intends use the proceeds of this financing
to pay for the marketing of its products (including its psoriasis treatment
products) and research and development expenses, and to use as working capital.
Cash and cash equivalents were $14,855,602, as of March 31, 2000, as
compared to $4,535,557, as of December 31, 1999. This increase was primarily
attributable to the receipt of $14,338,741 in net cash proceeds from the March
16, 2000 Financing.
As of March 31, 2000, the Company had total liabilities of $2,018,345
and an accumulated deficit of $28,727,228. As of December 31, 1999, the Company
had total debts of $4,431,336 and an accumulated deficit of $25,617,537.
As of March 31, 2000, the Company had long-term borrowings in the
aggregate amount of $34,087, less the current portion. As of December 31, 1999,
the Company had long-term borrowings in the aggregate amount of $43,620, less
the current portion. The decrease in long-term borrowings relates to the
repayment of long-term obligations from the proceeds of private placements of
the Company's securities.
In March, 2000, the Company paid $950,000 to the landlord for its
Florida facility, and $700,000 to CSC Healthcare Inc., to settle certain
disputes between the Company and such other parties. The Company paid these
amounts from the proceeds of the March 16, 2000 Financing.
Net cash used in operating activities was $4,062,330 and $971,817 for
the three (3) months ended March 31, 2000 and 1999, respectively. Net cash used
in operating activities during the three (3) months ended March 31, 2000 and
1999 primarily consisted of net losses, decreases in net current liabilities and
increases in net current assets (1999 only), offset by depreciation and
amortization, increases in interest related to the conversion features of the
Convertible Notes (1999 only), the payment in the Company's securities
(including Common Stock, options and warrants) of fees for services to
consultants (2000 only), and decreases in net current assets (2000 only).
Net cash used in investing activities was $75,906 and $10,151 for the
three (3) months ended March 31, 2000 and 1999, respectively. In the three (3)
months ended March 31, 2000, the Company utilized $75,906 to acquire equipment
16
<PAGE>
for the Company's excimer laser business operations. In the three (3) months
ended March 31, 1999, the Company utilized $10,151 to purchase equipment for the
construction of a laser to be used as a demonstration model.
Net cash provided by financing activities was $14,458,121 and
$2,223,797 during the three (3) months ended March 31, 2000 and 1999,
respectively. In the three (3) months ended March 31, 2000, the Company received
$14,338,741 from the net proceeds of the sale of 1,409,092 shares of Common
Stock in connection with the March 16, 2000 Financing, $166,312 from the
exercise of stock options and $220,627 from the exercise of warrants, which was
offset by the utilization of $267,399 for the payment of certain debts.
In the three (3) months ended March, 1999, the Company received
$2,380,000 in proceeds from the offering of the Convertible Notes, and $159,226
from the proceeds of certain notes payable, which was offset by the utilization
of $141,449 for the payment of certain debts, $7,380 for the payment of certain
related party notes payable and $166,600 for certain costs related to the
issuance of the Convertible Notes and certain other securities.
The Company's ability to expand business operations is currently
dependent on financing from external sources. There can be no assurance that
changes in the Company's manufacturing and marketing research and development
plans or other changes affecting the Company's operating expenses and business
strategy will not result in the expenditure of such resources before such time
or that the Company will be able to develop profitable operations prior to such
date, or at all, or that the Company will not require additional financing at or
prior to such time in order to continue operations. There can be no assurance
that additional capital will be available on terms favorable to the Company, if
at all. To the extent that additional capital is raised through the sale of
additional equity or convertible debt securities, the issuance of such
securities could result in additional dilution to the Company's stockholders.
Moreover, the Company's cash requirements may vary materially from those now
planned because of results of marketing, product testing, changes in the focus
and direction of the Company's marketing programs, competitive and technological
advances, the level of working capital required to sustain the Company's planned
growth, litigation, operating results, including the extent and duration of
operating losses, and other factors. In the event that the Company experiences
the need for additional capital, and is not able to generate capital from
financing sources or from future operations, management may be required to
modify, suspend or discontinue the business plan of the Company.
IMPACT OF INFLATION
The Company has not operated in a highly inflationary period, and its
management does not believe that inflation has had a material effect on sales or
expenses.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
In June, 1998, the Financial Accounting Standards Board ("FASB")
recently issued Statement of Financial Accounting Standards ("SFAS") No. 133,
"Accounting for Derivative Instruments and Hedging Activities." This statement
establishes accounting and reporting standards for derivatives, including
certain derivative instruments embedded in other contacts and for hedging
activities, and is effective for all fiscal years beginning after June 15, 2000.
Management believes that the adoption of SFAS No. 133 will have no impact on the
Company's operating results or financial position.
In December 1999, the Commission issued Staff Accounting Bulletin No.
101, "Revenue Recognition in Financial Statements" ("SAB No. 101"). SAB No. 101
summarizes certain of the Staff's views in applying generally accepted
accounting principles to recognition, presentation and disclosure of revenue in
financial statements. Compliance with SAB No. 101 is required no later than the
first quarter of the fiscal years beginning after December 15, 1999. The Company
has determined that its accounting policies for revenue recognition are in
compliance with the provisions of SAB No. 101.
YEAR 2000
One of the major challenges facing any company whose products or
services rely on the operation of computers or other equipment containing
computer chips is the issue of Year 2000 compliance. Many existing computer
programs use only two digits to identify a year in the date field. If not
corrected, many computer applications could fail or create erroneous results by
or at the Year 2000.
17
<PAGE>
During the last eighteen months, the Company has maintained a program
to reduce the risk from Year 2000 computer failures by its suppliers. Under this
program, all key suppliers were contacted, or supplied or made available their
Year 2000 readiness statements. Small vendors offering contract manufacturing
services that were unresponsive to the requests for Year 2000 information are in
each case one of multiple sources for the given service or product.
The Company has inventory for all current orders, as well as orders
anticipated in the first quarter of 2000. The Company's production methods
require the use of electric power and other municipal provided services, but has
been informed that these are Year 2000 compliant. The loss of power or water
would not significantly impact scheduled production unless the condition exists
for more than a week, although no assurance can be given to that effect.
The Company's design and development system relies exclusively on a
paper and hardcopy based system. There are documents created by computer aided
systems, but all are subject to design control by hardcopy. Management believes
that this design method protects the Company against catastrophic failure of any
computer system, and although the loss of all of the Company's computer systems
would slow the design process, it would not affect current designs, nor would it
result in a loss of data, although no assurance can be given to that effect. In
some cases, it could be necessary to restore or recreate data in electronic
form, which could take several weeks to accomplish. Management believes that, in
such a circumstance, the impact on the production of machines and on research
and development to be small, although no assurance can be given to that effect.
Since January 1, 2000, the Company has not experienced any adverse
impact from the transition to the Year 2000, although no assurance can be given
that the Company's suppliers or customers have not been affected in a manner
that is not yet apparent. In addition, some computer programs may not have been
programmed to process the Year 2000 as a leap year, and negative consequences
therefrom remain unknown.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
On May 4, 2000, the Company terminated its relationship with Hein +
Associates LLP, as principal independent accountants for the Company. The
decision to terminate Hein + Associates LLP as principal independent accountants
for the Company was approved by the Company's Board of Directors on May 4, 2000.
In connection with the audits for the three (3) most recent fiscal years ended
December 31, 1999, 1998 and 1997 and the subsequent interim period through May
4, 2000, there were no disagreements between Hein + Associates LLP and the
Company, on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedures, which disagreements, if
not resolved to the satisfactions of Hein + Associates LLP would have caused
Hein + Associates LLP to make reference in connection with its report for the
related periods with respect to the subject matter of the disagreement. The
audit reports of Hein + Associates LLP on the consolidated financial statements
of the Company, as of and for the fiscal years ended December 31, 1999, 1998 and
1997, did not contain any adverse opinion, or disclaimer of opinion, nor were
they qualified or modified as to uncertainty, audit scope, or accounting
principles. The Company is in the process of engaging new principal independent
accountants for the Company.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
The Company is not currently exposed to market risks due to changes in
interest rates and foreign currency rates and therefore the Company does not use
derivative financial instruments to address risk management issues in connection
with changes in interest rates and foreign currency rates.
PART II- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
18
<PAGE>
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
PRIVATE PLACEMENT
The Company entered into an agreement, dated as of February 2, 2000,
with ING Barings LLC for the provision of financial advisory and investment
banking services, on an exclusive basis. The term of the agreement is through
September 30, 2000. Pursuant to this agreement, ING acted as placement agent in
connection with a private offering to 10 institutional investors an aggregate of
1,409,092 shares of the Company's Common Stock at a price of $11.00 per share,
for which the Company paid ING customary fees. Sam Navarro, a director of the
Company is also the Global Head of Health Care Corporate Finance at ING. At the
close of the placement on March 16, 2000, the Company received net proceeds of
approximately $14,300,000. In addition, with the exception of Jeffrey F.
O'Donnell and Dennis McGrath, all of the executive officers and directors of the
Company signed lock-up agreements for a period of 90 days from March 16, 2000,
as to all securities of the Company they may own. Messrs. O'Donnell and McGrath
reserved the right to sell 65,000 and 35,000 shares, respectively, during such
90-day period. The Company has used and expects to continue to use the proceeds
of this financing to pay certain debts, including monies owed to the Company's
Orlando, Florida landlord, and for marketing expenses and working capital.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the quarter ended March 31, 2000, the Company's stockholders did
not adopt any resolutions at a meeting or by consent.
19
<PAGE>
ITEM 5. OTHER INFORMATION.
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
--------
10.1 Asset Purchase Agreement with Laser Components GmbH, dated February 29,
2000 (1)
16.1 Letter re Change in Certifying Accountant (2)
27 Financial Data Schedules
- -----------
(1) Previously as part of the Company's Registration Statement on Form S-1,
filed with the Commission on January 28, 1998, and as amended.
(2) Filed as part of the Company's Current Report on Form 8-K, dated May 9,
2000, and as amended.
B. Reports on Form 8-K
-------------------
The Company did not file any Current Reports on Form 8-K during the
quarter ended March 31, 2000. However, the Company filed a Current
Report on Form 8-K, and as amended on May 11, 2000, with respect to a
change in its principal independent accountants.
DOCUMENTS INCORPORATED BY REFERENCE
The Company is currently subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and in
accordance therewith files reports, proxy statements and other information with
the Commission. Such reports, proxy statements and other information may be
inspected and copied at the public reference facilities of the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington D.C. 20549; at its New York
Regional Office, Suite 1300, 7 World Trade Center, New York, New York 10048; and
its Chicago Regional Office, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661,and copies of such materials can be obtained from the Public
Reference Section of the Commission at its principal office in Washington, D.C.,
at prescribed rates. In addition, such materials may be accessed electronically
at the Commission's site on the World Wide Web, located at http://www.sec.gov.
The Company intends to furnish its stockholders with annual reports containing
audited financial statements and such other periodic reports as the Company may
determine to be appropriate or as may be required by law.
Certain documents listed above, as exhibits to this Report on Form
10-Q, are incorporated by reference from other documents previously filed by the
Company with the Commission as follows:
20
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LASER PHOTONICS, INC.
Date: May 15, 2000 By: /s/ Jeffrey F. O'Donnell
-------------------------------------
Jeffrey F. O'Donnell
President and Chief Executive Officer
Date: May 15, 2000 By: /s/ Dennis McGrath
-------------------------------------
Dennis McGrath
Chief Financial Officer
21
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