UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 1995
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 0-12459
Biosynergy, Inc.
-----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 36-2880990
-------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1940 East Devon Avenue, Elk Grove Village, Illinois 60007
-----------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone Number, including area code: (708) 956-0471
Indicate by check mark whether the registrant (1) 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 (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
------- -------
Number of shares outstanding of common stock as of the close
of the period covered by this report: 13,806,511
Page 1 of the 16 pages contained in the sequential numbering system.
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
Board of Directors and Shareholders
Biosynergy, Inc.
Elk Grove Village, Illinois
The accompanying Balance Sheet of BIOSYNERGY, INC. as at
October 31, 1995 and the related Statements of Operations,
Shareholders' Equity (Deficit) and Statements of Cash Flows
for the six month periods ended October 31, 1995 and 1994 were
not audited; however, the financial statements for the six month
periods ending October 31, 1995 and 1994 reflect all adjustments
(consisting only of normal reoccurring adjustments) which are,
in the opinion of management, necessary to provide a fair statement
of the results of operations for the interim periods presented.
The financial statements for the fiscal year ended April 30, 1995, were
not audited due to the Company's lack of available cash to pay for
such audit; however, the financial statements for the fiscal year ending
April 30, 1995 reflect all adjustments (consisting only of normal
reoccurring adjustments) which are, in opinion of management, necessary
to provide a fair statement of the results of operations for the period
presented.
BIOSYNERGY, INC.
December 12, 1995
<PAGE>
<TABLE>
BIOSYNERGY, INC.
BALANCE SHEET
<CAPTION>
October 31, 1995 April 30,1995
Unaudited Unaudited
--------- ---------
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash 7,841 4,520
Accounts Receivable, Trade,
Net of Allowance for Uncollectible
Accounts of $500 at October 31,
1995 and April 30, 1995 65,684 58,152
Inventories (Notes 1 and 4) 51,144 44,947
Prepaid Expenses 2,717 4,133
---------- -----------
Total Current Assets 127,386 111,752
---------- -----------
DUE FROM AFFILIATES (Note 3) 260,741 250,006
---------- -----------
PROPERTY AND EQUIPMENT
Equipment 154,036 154,036
Leasehold Improvements 12,216 12,216
---------- -----------
166,252 166,252
Less: Accumulated Depreciation and
Amortization ( 161,308) (159,919)
---------- -----------
4,944 6,333
OTHER ASSETS
Patents, Net of Accumulated
Amortization (Note 1) 32,041 34,725
Deposits 5,494 6,504
Investment in Affiliated Company (Note 3) 0 0
---------- ----------
37,535 41,229
430,606 409,320
---------- ----------
---------- ----------
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
<S> <C> <C>
CURRENT LIABILITIES
Accounts Payable 76,710 66,863
Notes Payable - Officer 9,038 16,288
Accrued Executive Compensation 100,267 97,768
Other Accrued Compensation 1,102 5,567
Accrued Payroll Taxes (Includes
Penalties of $2,739 at October
31, 1995 and $8,444 at April 30, 1995) 2,739 26,758
Deferred Rent 924 2,774
Other Accrued Expenses 7,719 6,027
Total Current Liabilities 198,499 222,045
-------- ----------
COMMITMENTS AND CONTINGENCIES (Note 8) - -
-------- ----------
SHAREHOLDERS' EQUITY (Notes 5 and 6)
Common Stock, No Par Value; 20,000,000
Shares Authorized, Issued: 13,806,511
Shares at October 31, 1995 and at
April 30, 1995 632,663 632,663
-------- ---------
Additional paid-in capital 100 100
Accumulated Deficit since July 31, 1985
in connection with Quasi-Reorganization (400,656) (445,488)
--------- ---------
232,107 187,275
430,606 409,320
--------- ---------
--------- ---------
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BIOSYNERGY, INC.
STATEMENT OF OPERATIONS
UNAUDITED
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
OCTOBER 31, OCTOBER 31,
------------------- ------------------
1995 1994 1995 1994
--------- -------- --------- -------
<S> <C> <C> <C> <C>
REVENUES
Sales 120,813 115,976 236,686 210,573
Interest Income - - 54 41
Computer Rentals and
Services 150 150 300 300
Other Income 1,008 1,192 1,869 1,953
--------- --------- --------- -------
121,971 117,318 238,909 212,867
--------- --------- --------- -------
COST AND EXPENSES
Cost of Sales and Other
Operating Charges 42,044 39,001 80,319 84,511
Research and Development 7,878 6,556 15,328 13,218
Marketing 11,052 8,668 22,034 17,343
General and Administrative 39,645 40,097 74,993 79,865
Interest Expense 722 2,162 1,403 2,704
--------- ---------- -------- -------
101,341 96,484 194,077 197,641
--------- ---------- --------- -------
NET INCOME (LOSS) 20,630 20,834 44,832 15,226
--------- ---------- --------- -------
--------- ---------- --------- -------
NET INCOME (LOSS) PER
COMMON SHARE (Note 7) .001 .001 .003 .001
--------- ---------- ---------- --------
--------- ---------- ---------- --------
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING (Note 7) 13,806,511 13,806,511 13,806,511 13,806,511
---------- ----------- ---------- ----------
---------- ----------- ---------- ----------
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BIOSYNERGY, INC.
STATEMENT OF SHAREHOLDERS' EQUITY
SIX MONTHS ENDED OCTOBER 31, 1995
Unaudited
<CAPTION>
Additional
Common Stock Paid-in
Shares Amount Capital Deficit Total
---------- --------- ---------- -------- ------
<S> <C> <C> <C> <C> <C>
Balance, May 1, 13,806,511 632,663 100 (445,488) 187,275
1995
Net Profit (Loss) - - - 44,832 44,832
Sale of - - - - -
Common Stock ---------- --------- ---------- -------- -------
Balance, October
31, 1995 13,806,511 632,663 100 (400,656) 232,107
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
<TABLE>
BIOSYNERGY, INC.
STATEMENTS OF CASH FLOWS
Unaudited
<CAPTION>
SIX MONTHS ENDED OCTOBER 31,
1995 1994
----------------------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net Income (Loss)
Adjustments to Reconcile Net Cash Used for 44,832 15,226
Operating Activities:
Depreciation and Amortization 4,073 4,626
Changes in Operating Assets and Liabilities:
(Increase) Decrease in Accounts Receivable ( 7,532) ( 1,386)
(Increase) Decrease in Inventories ( 6,197) 3,393
(Increase) Decrease in Prepaid Expenses 1,417 1,422
Increase (Decrease) in Accounts Payable
and Accrued Expenses ( 16,296) 7,484
--------- ---------
Net Cash Provided (Used) by Operating
Activities 20,297 30,765
--------- ---------
INVESTING ACTIVITIES:
(Increase) Decrease in Due From Affiliate ( 10,735) ( 12,839)
--------- ---------
(Increase) Decrease in Deposits 1,009 -
--------- ---------
Net Cash Provided (Used) by Investing
Activities ( 9,726) ( 12,839)
--------- ---------
FINANCING ACTIVITIES:
Proceeds from Borrowing (Repayments) ( 7,250) ( 5,350)
--------- ---------
Net Cash Provided (Used) by Financing
Activities ( 7,250) ( 5,350)
--------- ---------
Increase (Decrease) in Cash and Cash
Equivalents 3,321 12,576
--------- ---------
Cash and Cash Equivalents at Beginning
of Period 4,520 6,174
--------- ---------
Cash and Cash Equivalents at End of Period 7,841 18,750
--------- ---------
--------- ---------
<FN>
The accompanying notes are an integral part of the financial statements.
</TABLE>
<PAGE>
BIOSYNERGY, INC.
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies:
Inventories-Inventories are valued at the lower of cost or market
using the FIFO (first-in, first-out) method.
Equipment and Leasehold Improvements-Equipment and Leasehold
improvements are stated at cost. Depreciation and amortization
are computed primarily on the straight-line method over the
estimated useful lives of the respective assets. Repairs and
maintenance are charged to expense as incurred; renewals and
betterments which significantly extend the useful lives of
existing property and equipment are capitalized. Significant
leasehold improvements are capitalized and amortized over the
term of the lease.
Research and Development, and Patents-Research and development
expenditures are charged to operations as incurred. The cost of
obtaining patents, primarily legal fees, are capitalized and
amortized over seventeen years on the straight-line method.
2. Company Organization and Description:
The Company was incorporated under the laws of the State of
Illinois on February 9, 1976. It is primarily engaged in the
development and marketing of medical, consumer and industrial
thermometric and thermographic products that utilize cholesteric
liquid crystals.
3. Related Party Transactions:
The Company and its affiliates are related through common stock
ownership as follows as of October 31, 1995:
<TABLE>
<CAPTION>
S T O C K O F A F F I L I A T E S
-------------------------------------
F.K. Suzuki
Stevia Biosynergy International Medlab
Company Inc. Inc. Inc.
-------- ---------- -------------- --------
<S> <C> <C> <C> <C>
Stock Owner
- ------------
Stevia Company, Inc. - 13.8% - -
Biosynergy, Inc. .4% - - -
F.K. Suzuki
International, Inc. 55.8% 18.8% - 100.0%
Fred K. Suzuki, - - 35.6% -
Officer and Director
Lauane C. Addis, .1% .1% 32.7% -
Officer and Director
James F. Schembri, - 12.9% - -
Director
</TABLE>
Upon the completion of the Company's public offering on July 7, 1983,
the Company issued 2,000,000 shares of its no par value common stock in
exchange for 1,058,181 shares of common stock of Stevia Company, Inc. The
common stock of Stevia Company, Inc. had no book value at the time of the
<PAGE>
BIOSYNERGY, INC.
NOTES TO FINANCIAL STATEMENTS
exchange and, as a consequence, the Company recorded the exchange at zero
dollar value. The Company owned 130,403 shares of Stevia Company,
Inc. Common Stock at October 31, 1995. Although the Common Stock of
Stevia Company, Inc. can be traded in the over-the-counter market, there
is no established public trading market for such common stock due to
limited and sporadic trades. Stevia Company, Inc. Common Stock had an
estimated market price of less than $.01 as of October 31, 1995.
Common offices are shared with Stevia Company, Inc. Intercompany
charges for shared expenses are made by whichever company incurs such
charges. Such intercompany charges, together with funds advanced in
prior years, have resulted in the following balances due from Stevia
Company, Inc.:
October 31, 1995 - $248,333
April 30, 1995 - $237,597
At April 30, 1995 and October 31, 1995, the financial condition
of Stevia Company, Inc. was such that it is unlikely to be able
to repay the Company during the current year without liquidating a
portion of its assets.
The following balances were due from F.K. Suzuki International, Inc.
at the dates indicated based on the allocation of common expenses offset
by advances received from time to time:
October 31, 1995 - $12,409
April 30, 1995 - $12,409
At April 30, 1995 and October 31, 1995, the financial condition of F.K.
Suzuki International, Inc. was such that it is unlikely to be
able to repay the Company during the current year without liquidating
a portion of its assets.
As of October 31, 1995 and April 30, 1995, the Company had two
outstanding loans due to Fred K. Suzuki, President of the Company. See
Note 9. See also Note 5.
4. Inventories:
Components of inventories are as follows:
<PAGE>
BIOSYNERGY, INC.
NOTES TO FINANCIAL STATEMENTS
<TABLE>
April 30, 1995 October 31, 1995
-------------- ----------------
<S> <C> <C>
Raw Materials $ 29,395 $ 34,498
Work-in process 12,136 12,793
Finished Goods 3,416 3,853
--------------- ----------------
$ 44,947 $ 51,144
--------------- ----------------
--------------- ----------------
</TABLE>
5. Common Stock:
As of October 31, 1995, under an employee stock incentive
plan adopted in 1983, stock options and stock appreciation rights for
131,500 shares of stock were granted to four advisors, directors,
officers, consultants, and/or employees of the Company. The exercise
price is $.05 per share. The Company reserved 350,000 shares of its
common stock for this plan. Under the plan, stock options may be
granted with respect to shares subject to expired stock options.
As permitted in the plan, the directors of the Company extended the
termination date (last date to grant options) of the plan from May 19,
1986 to December 31, 1989. No further action has been taken to extend
the term of the plan.
Effective January 31, 1990, the Company entered into an agreement
with its President, Fred K. Suzuki, pursuant to which the Company
granted an option to convert all or a portion of his accrued but unpaid
compensation into shares of the Company's no par value common stock at
a conversion rate of $.05 per share.
The option is conditioned upon the Company having sufficient liquid
assets to pay all employee taxes due at the time of the conversion.
The option may be exercised until Mr. Suzuki is no longer owed accrued
but unpaid salary. The accrued but unpaid salary arose as a result of
Mr. Suzuki agreeing to defer his salary when the Company was not
financially able to pay salaries on a regular basis. The option
contains anti-dilutive provisions in the event of corporate capital
reorganizations. An aggregate of 1,223,915 shares of the Company's
common stock were subject to Mr. Suzuki's option at October 31, 1995.
On August 1, 1993, the Company entered into a Stock Option Agreement
with Fred K. Suzuki, President, granting Mr. Suzuki an option to
purchase 3,000,000 shares of the Company's common stock at an option
price of $0.025 per share. This Stock Option Agreement was granted
to Mr. Suzuki in consideration of his loaning money to the company on an
unsecured basis from time to time. The option contains anti-dilutive
provisions in the event of corporate capital reorganizations. As of
October 31, 1995, no portion of this Option has been exercised.
The Company's common stock is traded in the over-the-counter market.
However, there is no established public trading market for such common
stock due to limited and sporadic trades. The Company's common stock
is not listed on a recognized market or stock exchange.
<PAGE>
BIOSYNERGY, INC.
NOTES TO FINANCIAL STATEMENTS
6. Quasi-Reorganization:
On July 31, 1985, the Company effected a Quasi-Reorganization which
resulted in the elimination of $1,976,417 of accumulated deficit at the
date of reorganization and a decrease of $1,976,417 in the amount of
common stock outstanding.
7. Income (Loss) Per Share:
Net income or (loss) per common share is computed using the weighted
average number of common shares outstanding during the period, after
giving effect to stock splits. Fully diluted earnings per share, assuming
exercise of outstanding options, is not presented since exercise of the
options would be anti-dilutive.
8. Lease Commitments:
During 1991, the Company entered into a lease agreement for its
current facilities which expires January 31, 1996. The base rent under
the lease, of which 15% is allocated to Stevia Company, Inc., for each
fiscal year is as follows:
Year ending April 30 Total Base Rent
--------------------- --------------------
1992 $53,466
1993 $57,889
1994 $59,061
1995 $62,574
1996 (to January 31, 1996) $46,931
Also included in the lease agreement are escalation clauses for the
lessor's increases in property taxes and other operating expenses. The
lease can be extended for an additional five year term. At this time,
the Company is negotiating a new five year lease for its current facilities.
9. Notes Payable:
Notes payable consists of the following:
. $12,100 unsecured note payable to Mr. Suzuki. The note bears
interest at 11.5%, and is due on demand. The balance of this note at
April 30, 1995 was $8,700 and $1,450.00 at October 31, 1995.
. $7,587.75 unsecured note payable to Mr. Suzuki. This
note bears interest at 10%, and is due on demand. The balance of this
note at April 30, 1995 and October 31, 1995 was $7,587.75. This note
represents an advance to the Company for expenses incurred, including
legal fees, for the settlement of a lawsuit. The expenses of this lawsuit
were equally divided between the Company, Mr. Suzuki, Stevia Company, Inc.
and F.K. Suzuki International, Inc., affiliates of the Company.
<PAGE>
BIOSYNERGY, INC.
NOTES TO FINANCIAL STATEMENTS
10. Income Taxes:
At April 30, 1995, net operating loss carryforwards were
available and expire, if not used, as follows:
Year Ending Net Operating
April 30, Losses
-------------- ---------------
1998 $ 376,087
1999 677,671
2000 455,166
2001 449,142
2002 132,470
2003 85,822
2004 41,176
2006 160
2007 28,253
-------------- -------------
$ 2,245,947
The Company adopted Statement of Financial Accounting Standards
(SFAS) No. 109, "Accounting for Income Taxes" for the fiscal year ending
April 30, 1994 as required by SFAS No. 109. The effect, if any, of
adopting Statement No. 109 on pre-tax income from continuing operations
is not material. The company has elected not to retroactively adopt the
provisions allowed in SFAS No. 109; however, all provisions of the document
have been applied since the beginning of fiscal year 1994.
11. Major Customers:
Shipments to one customer accounted for approximately 30.52% of sales
during the six month period ending October 31, 1995. The outstanding
receivable from this customer was $22,637.45 at October 31, 1995.
12. New Products:
The Company has introduced the HemoTemp II Activator. The
Activator will provide users of HemoTemp II Blood Bag Temperature Indicators
an accurate and reliable source of heat that is ideal for activation of that
product.
13. Management's Plans:
In view of the fact the Company has incurred substantial losses in
prior years, management of the Company recognizes the Company's ability to
continue as a going concern is subject to maintaining or increasing sales
and the ability of the Company to obtain financing, when needed. To
this extent, management has endeavored to introduce the Company's products
to new markets and expand its marketing efforts in the traditional medical
market. Management also intends to continue pursuing financing
opportunities, including selling its common stock to private investors, if
necessary.
<PAGE>
Item 2. MANAGEMENT ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
SALES/REVENUES
--------------
For the three month period ending October 31, 1995 ("2nd Quarter"), the
net sales increased 4.17% or $4,837, and increased 12.4% or $26,113 during
the six month period ending October 31, 1995, as compared to net sales for
the comparative periods ending in 1994. This increase in sales is the
result of increased sales of a variety of the Company's products rather
than any single product. As of October 31, 1995 the Company had no
product back orders.
In addition to the above, the Company realized $300 of income as
a result of leasing a portion of its computer time to Stevia
Company, Inc., an affiliate, and $1,869 of miscellaneous income
and $54 of interest income for the six month period ending October 31, 1995.
INCOME/LOSS
-----------
The Company realized a net profit of $20,630 during the 2nd Quarter as
compared to a net profit of $20,834 for the comparative quarter of the
prior year. The Company also realized a net profit of $44,832 for the
six month period ending October 31, 1995, as compared to a profit of
$15,226 during the same period in 1994. The increase in income is a
result of improved sales without any material change in expenses. There
can be no assurance that the Company's sales will improve or stay
at their present level on which the profitability of the Company
is dependent.
As of April 30, 1995, the Company has incurred net operating
losses aggregating $2,245,947. As a result of net operating loss
carryovers, no income taxes were due for Fiscal 1995 and will
unlikely be due for Fiscal 1996. See "FINANCIAL STATEMENTS" for
the effect of the net operating loss carryforwards on the Company's
income tax position. The Tax Reform Act of 1986 will not alter the
Company's net operating loss carryforward position, and the net operating
loss carryforwards will be available and expire, if not used, as set
forth in Footnote 10 of the "FINANCIAL STATEMENTS."
EXPENSES
--------
GENERAL
-------
The operating expenses incurred by the Company during the 2nd
Quarter increased overall by 5% or $4,857, and decreased by 1.8%
or $3,564 for the six month period ending October 31, 1995.
These fluctuations were not material to the operations of the
Company nor indicative of any unusual trends. An explanation of
each catagory of expenses is included to assist the reader in reviewing
the operations of the Company during the periods indicated.
<PAGE>
COST OF SALES AND OTHER OPERATING CHARGES
-----------------------------------------
The cost of sales and other operating charges during the 2nd
Quarter increased by $3,043, and decreased by $4,192 during the
six month period ending October 31, 1995 as compared to the same
periods ending in 1994. As a percentage of sales, the cost of
sales and other operating charges were 34.8% during the 2nd
Quarter and 33.63% for the same quarter ending in 1994, and
33.93% during the six month period ending October 31, 1995
compared to 40.13% in 1994. The overall decrease in cost of
sales and operating charges for the six month period ending
October 31, 1995, as a percentage of sales, was due primarily to
an increase in sales on a unit basis with a corresponding
improved production efficiency.
RESEARCH AND DEVELOPMENT
------------------------
Research and Development costs increased by $1,322 or 20.16% during the
2nd quarter, as compared to the same quarter in 1994. These costs also
increased by $2,110 or 15.96% during the six month period ending October 31,
1995 as compared to the same period in 1994. This increase was not
material to the operations of the Company. The Company intends to direct
future research and development to the improvement of its current product
line and to those new products, the development of which has already
commenced, or those products which are natural expansions of the current
product line. The Company may also increase its research and development
activities to fulfill research and development contracts for the
development of products for customers, which will be offset by research
revenues.
MARKETING
---------
Marketing costs for the 2nd Quarter increased by $2,384 or 27.5%, as
compared to the quarter ending October 31, 1994, and increased $4,691 or
27.04% during the six month period ending October 31, 1995 as compared
to the same period in 1994. This increase is a result of increased
marketing activity such as advertising, trade shows, direct mailings, and
an increase in commissioned sales. As financial resources become
available, the Company intends to further expand its marketing budget.
GENERAL AND ADMINISTRATIVE
--------------------------
General and administrative costs did not materially change during
the 2nd quarter and decreased by $4,872, or 6.1%, during the six
month period ending October 31, 1995, as compared to the same
period ending in 1994. This was primarily due to a decrease in
salaries and associated employee expenses as the result of the
Company's bookkeeper resigning in May, 1995.
<PAGE>
ASSETS/LIABILITIES
- ------------------
GENERAL
-------
Since April 30, 1995, the Company's assets and liabilities have
not materially changed.
DUE FROM AFFILIATES
-------------------
The Company was owed $248,333 by Stevia Company, Inc. ("Stevia"),
an affiliate, and $12,409 by F.K. Suzuki International, Inc. ("FKSI"), an
affiliate, at October 31, 1995. These affiliates owed $237,597 and
$12,409 at April 30, 1995, respectively. These accounts primarily
represent common expenses which are charged by one company to the other
for reimbursement. These expenses include certain rent, salaries for
common employees, insurance and employee benefits, and legal fees.
Beginning May 1, 1994, a greater portion of these common expenses were
allocated to the Company to reflect the decreasing activity of Stevia
Company, Inc. and the increased activity of the Company. These expenses
are reviewed from time to time to determine if reallocation is appropriate.
See "Financial Statements." These expenses are incurred in the ordinary
course of business. As a result of the increase in amounts due from
affiliates, the Company has reduced its own liquid resources. The Company
intends to reverse this trend by restricting the dollar volume of advances
and common expense charges to Stevia and FSKI until these affiliates
are in a position to reimburse the Company.
CURRENT ASSETS/CURRENT LIABILITY RATIO
--------------------------------------
The ratio of current assets to current liabilities, .64 to 1, has
improved compared to .50 to 1 at April 30, 1995. In view of the
Company's operating expenses, there is a risk that the Company's
current asset/current liability ratio may not be adequate for the
Company's current or future operating needs unless the Company's
sales remain at the present level or improve.
WORKING CAPITAL/LIQUIDITY
-------------------------
During the six month period ending October 31, 1995, the Company
experienced an increase in working capital of $34,281. This is
due to the increase in profit of the Company during the six month
period ending October 31, 1995 and a corresponding decrease in
liabilities.
In view of the fact that the Company has incurred substantial
losses in prior years and has a working capital deficit, Management of
the Company recognizes the Company's ability to continue as a going concern
is subject to maintaining and improving sales, profitable operations,
collection of accounts receivable, and the ability of the Company to
obtain capital, when needed, of which there is no assurance. The Company
intends
<PAGE>
to continue expanding its marketing efforts in the medical market
and new markets. Finally, Management intends to continue financing
opportunities, including selling its common stock to private investors,
if necessary. The Company does not have a working line of credit, and
there can be no assurance, nor is it anticipated, that the Company will
be able to obtain a working line of credit on acceptable terms.
Irrespective of the Company's deficit in working capital, the Company has
not been refused goods or services from any of its vendors.
Since the Company does not have an operating line of credit, the
Company's President, Fred K. Suzuki, has made loans to the Company
during the past two fiscal years for working capital purposes.
See Footnote 9 of the "Financial Statements". There can be no assurance
such loans will be available in the future or on terms acceptable to the
Company.
Except for its operating working capital needs, the Company has no material
contingencies for which it must provide.
<PAGE>
PART II - OTHER INFORMATION
----------------------------
Item 6. Exhibits and Reports on Form 8K.
(a) The following exhibits are filed as a part of this
report:
(3) Articles of Incorporation and By-laws (i)
(10) Material Contracts
(a) Deferred Compensation Option Agreement, dated
January 31, 1990, between the Company and Fred K.
Suzuki (ii)
(b) Stock Option Agreement, dated August 1, 1993,
between the Company and Fred K. Suzuki (iii)
(c) Promissory Note dated March 2, 1993, in the amount
of $12,100 payable to Fred K. Suzuki. (iii)
(d) Promissory Note dated July 1, 1993, in the amount
of $7,587.75 payable to Fred K. Suzuki. (iii)
(15) Letter dated December 8, 1995, regarding interim financial
information. (iv)
(27) Financial Data Schedule, attached hereto as
an Exhibit.
(b) No Current Reports on Form 8K were filed during
the period covered by this Report.
[FN]
---------------------
(i) Incorporated by reference to a Registration Statement
filed on Form S-18 with the Securities and Exchange Commission,
1933 Act Registration Number 2-38015C, under the Securities Act
of 1933, as amended, and Incorporated by reference, with regard
to Amended By-Laws, to the Company's Annual Report on Form 10K
for fiscal year ending April 30, 1986 filed with the Securities
and Exchange Commission.
(ii) Incorporated by reference to the Company's Annual Report on
Form 10K for fiscal year ending April 30, 1990 filed with the Securities
and Exchange Commission.
(iii) Incorporated by reference to the Company's Annual Report on Form
10K for fiscal year ending April 30, 1994 filed with the Securities and
Exchange Commission.
(iv) This exhibit is included in this report as a part of
the Financial Statements, and is incorporated by reference
herein.
<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 thereto duly authorized.
Biosynergy, Inc.
Date December 12, 1995 ____________________________________
----------------- Fred K. Suzuki, President, Chairman
of the Board, Chief Accounting
Officer and Treasurer
Date December 12, 1995 ____________________________________
----------------- Lauane C. Addis, Secretary, Corporate
Counsel and Director
<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 thereunto duly authorized.
Biosynergy, Inc.
Date December 12, 1995 /s/ FRED K. SUZUKI /s/
----------------- ----------------------------
Fred K. Suzuki, President,
Chairman of the Board, Chief
Accounting Officer and Treasurer
Date December 12, 1995 /s/ LAUANE C. ADDIS /s/
----------------- ----------------------------
Lauane C. Addis, Secretary,
Corporate Counsel and Director
<PAGE>
-----------------------------------------------------------------
-----------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10Q
Annual Report Pursuant to Section 13 or 15(d)
of
THE SECURITIES AND EXCHANGE ACT OF 1934
For the period ending October 31, 1995
Commission File Number: 0-12459
BIOSYNERGY, INC.
-----------------------------------------------------------------
(Exact name of registrant as specified in charter)
1940 East Devon Avenue
Elk Grove Village, IL 60007
(708) 593-0226
(Address and telephone number of registrant's
principal executive office on a principal place of business)
-------------------------------
EXHIBITS
-----------------------------------------------------------------
-----------------------------------------------------------------
<PAGE>
EXHIBIT INDEX
-------------
Page Number
Pursuant to
Sequential
Exhibit Numbering
Number Exhibit System
---------- ---------- ---------------
27 Financial Data Schedule E-1
<PAGE>
[TYPE] EX-27
[ARTICLE] 5
[LEGEND]
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
FINANCIAL STATEMENTS OF THE REGISTRANT FOR THE SIX MONTH PERIOD ENDING
OCTOBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
[/LEGEND]
<TABLE>
<S> <C> <C>
[PERIOD-TYPE] 3-MOS 6-MOS
[FISCAL-YEAR-END] APR-30-1996 APR-30-1996
[PERIOD-END] OCT-31-1995 OCT-31-1995
[CASH] 7,841 7,841
[SECURITIES] 0 0
[RECEIVABLES] 65,084 65,684
[ALLOWANCES] 500 500
[INVENTORY] 51,144 51,144
[CURRENT-ASSETS] 127,386 127,386
[PP&E] 166,252 166,252
[DEPRECIATION] (161,308) (161,308)
[TOTAL-ASSETS] 430,606 430,606
[CURRENT-LIABILITIES] 198,499 198,499
[BONDS] 0 0
[COMMON] 632,663 632,663
[PREFERRED-MANDATORY] 0 0
[PREFERRED] 0 0
[OTHER-SE] (400,656) (400,656)
[TOTAL-LIABILITY-AND-EQUITY] 430,606 430,606
[SALES] 120,813 236,686
[TOTAL-REVENUES] 121,971 238,909
[CGS] 42,044 80,319
[TOTAL-COSTS] 42,044 80,319
[OTHER-EXPENSES] 18,930 37,362
[LOSS-PROVISION] 0 0
[INTEREST-EXPENSE] 722 1,403
[INCOME-PRETAX] 20,630 44,832
[INCOME-TAX] 0 0
[INCOME-CONTINUING] 0 0
[DISCONTINUED] 0 0
[EXTRAORDINARY] 0 0
[CHANGES] 0 0
[NET-INCOME] 20,630 44,832
[EPS-PRIMARY] .001 .003
[EPS-DILUTED] .001 .003
</TABLE>
