As filed with the Securities and Exchange Commission
on February 14, 1995
FORM 10-Q
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DECEMBER 31, 1994
(for quarterly period ended)
0-11493
Commission File Number
BALLARD MEDICAL PRODUCTS
(Exact name of registrant as specified in its charter)
UTAH
(State or other jurisdiction of incorporation or organization)
87-0340144
(I.R.S. Employer Identification Number)
12050 LONE PEAK PARKWAY, DRAPER, UTAH 84020
(Address and zip code of principal executive offices)
(801) 572-6800
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed
since last report)
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.
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the
issuer's classes of stock, as of the latest practicable date:
26,486,996 - all common, February 8, 1995
<PAGE>
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
FORM 10-Q INDEX
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PART I FINANCIAL INFORMATION 4
Item 1. Financial Statements 4
Condensed Unaudited Consolidated
Balance Sheets as of December 31, 1994
and September 30, 1994 4-5
Condensed Unaudited Consolidated
Statements of Operations for the three
months ended December 31, 1994 and 1993 6-7
Condensed Unaudited Consolidated
Statements of Cash Flows for the
three months ended December 31,
1994 and 1993 8
Notes to Condensed Unaudited
Consolidated Financial Statements 9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
Risk Factors 12
PART II OTHER INFORMATION 14
Item 1. Legal Proceedings 14
Item 2. Changes in Securities 15
Item 3. Defaults Upon Senior Securities 15
Item 4. Submission of Matters to a Vote
of Security Holders 15
Item 5. Other Information 16
Item 6. Exhibits and Reports on Form 8-K 16
Signatures 16
Index to Exhibits 16
<PAGE>
DEFINITIONS
As used herein, the following terms have the meanings
indicated:
1. "Ballard" refers to Ballard Medical Products.
2. The "Company" and the "Registrant" refer to Ballard
and its subsidiaries.
3. "MIC" refers to Medical Innovations Corporation, a
wholly-owned subsidiary of Ballard.
4. "Code Blue" refers to Code Blue Medical
Corporation, a former wholly-owned subsidiary of
Ballard, which was statutorily merged into Ballard
in May, 1993.
5. "BREH" refers to Ballard Real Estate Holdings,
Inc., a wholly-owned subsidiary of Ballard.
6. "BI" refers to Ballard International, Inc., a
wholly-owned subsidiary of Ballard.
7. The "Annual Report" refers to the Company's Annual
Report for the fiscal year ended September 30,
1994, which was mailed to its shareholders and to
the Commission on or about December 9, 1994.
8. The "Proxy Statement" refers to the Company's Proxy
Statement mailed to its shareholders and to the
Commission on or about December 9, 1994, for the
Annual Shareholder Meeting to be held January 23,
1995.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
CONDENSED UNAUDITED CONSOLIDATED BALANCE SHEETS
</TABLE>
<TABLE>
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ASSETS 12/31/94 9/30/94
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CURRENT ASSETS:
Cash and cash equivalents $19,070,286 $15,109,682
Investments available
for sale (cost: $15,608,143) 14,617,631
Investments 16,330,685
Trade accounts receivable - net 14,838,393 13,505,173
Other receivables 2,226,997 1,723,637
Inventories:
Raw materials 3,025,696 3,231,757
Work-in-progress 2,078,527 2,088,350
Finished goods 3,505,045 4,353,529
Deferred income taxes 659,717 407,405
Income tax refunds receivable 2,347,031 2,347,031
Prepaid expenses 549,550 690,143
Total current assets 62,918,873 59,787,392
PROPERTY AND EQUIPMENT:
Land 1,849,512 1,849,511
Building 11,923,232 11,912,302
Molds 2,181,581 2,044,983
Machinery and equipment 7,491,204 7,401,870
Vehicles 469,179 441,135
Furniture and fixtures 1,168,452 1,067,148
Leasehold improvements 99,406 71,118
Construction in progress 785,092 729,922
Total 25,967,658 25,517,989
<PAGE>
Less accumulated depreciation 4,806,037 4,514,129
Property and equipment - net 21,161,621 21,003,860
INTANGIBLE ASSETS - net 11,613,548 11,568,397
OTHER ASSETS 20,624 20,624
DEFERRED INCOME TAXES 313,461 258,952
TOTAL $96,028,127 $92,639,225 <PAGE>
</TABLE>
See Notes to Condensed Unaudited Consolidated Financial Statements.
<TABLE>
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12/31/94 9/30/94
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $501,181 $228,749
Accrued liabilities:
Employee compensation 501,635 1,114,092
Income taxes payable 1,221,877
Royalties 511,487 370,579
Other 444,138 492,306
Total current liabilities 3,180,318 2,205,726
DEFERRED INCOME TAXES
Total liabilities 3,180,318 2,205,726
STOCKHOLDERS' EQUITY:
Common stock 2,647,076 2,645,586
Additional paid-in capital 28,364,825 28,291,261
Retained earnings 62,480,830 59,496,652
Net unrealized loss on
investments available for sale
(net of taxes) (644,922)
Total stockholders' equity 92,847,809 90,433,499
TOTAL $96,028,127 $92,639,225
</TABLE>
See Notes to Condensed Unaudited Consolidated Financial Statements.
<PAGE>
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
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Three Months Three Months
Ended 12/31/94 Ended 12/31/93
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NET SALES $18,510,229 $16,035,355
COST OF PRODUCTS SOLD 6,218,877 4,849,317
GROSS MARGIN 12,291,352 11,186,038
OPERATING EXPENSES:
Selling, general and administrative 5,356,123 4,949,201
Research and development 461,565 391,153
Royalties 370,500 311,075
Total operating expenses 6,188,188 5,651,429
OPERATING INCOME 6,103,164 5,534,609
OTHER INCOME - net 911,300 1,060,151
INCOME BEFORE INCOME TAX EXPENSE 7,014,464 6,594,760
INCOME TAX EXPENSE 2,448,000 2,302,774
INCOME BEFORE CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING FOR INCOME TAXES 4,566,464 4,291,986
CUMULATIVE EFFECT OF CHANGE IN
ACCOUNTING FOR INCOME TAXES 1,403,232
NET INCOME $4,566,464 $5,695,218
</TABLE>
See Notes to Condensed Unaudited Consolidated Financial Statements.
<PAGE>
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(continued)
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Three Months Three Months
Ended 12/31/94 Ended 12/31/93
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INCOME PER COMMON AND COMMON EQUIVALENT
SHARES:
Income before cumulative effect of
change in accounting for income taxes $0.168 $0.158
Cumulative effect of change in
accounting for income taxes 0.052
Net income $0.168 $0.210
INCOME PER COMMON SHARES ASSUMING FULL
DILUTION:
Income before cumulative effect of
change in accounting for income taxes $0.167 $0.158
Cumulative effect of change in
accounting for income taxes 0.052
Net income $0.167 $0.210
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING:
Common and common equivalent share 27,246,658 27,155,223
Common share assuming full dilution 27,320,177 27,155,416
</TABLE>
See Notes to Condensed Unaudited Consolidated Financial Statements.
<PAGE>
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
CONDENSED UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
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Three Months Three Months
Ended 12/31/94 Ended 12/31/93
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CASH FLOWS FROM OPERATING ACTIVITIES $5,477,147 ($596,592)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures for property
and equipment (449,669) (4,094,362)
Purchases of investments
available for sale (3,810,264)
Purchases of investments (5,332,748)
Purchases of intangible assets (282,184) (521,829)
Proceeds from maturities of
investments available for sale 4,532,806
Proceeds from maturities of
investments 4,639,962
Net cash used in investing activities (9,311) (5,308,977)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of options 75,054 701,612
Cash dividends paid (1,582,286) (1,329,575)
Purchase of treasury stock (124,750)
Net cash used in financing activities (1,507,232) (752,713)
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 3,960,604 (6,658,282)
CASH AND CASH EQUIVALENTS, BEGINNING OF
PERIOD 15,109,682 16,113,853
CASH AND CASH EQUIVALENTS, END OF PERIOD $19,070,286 $9,455,571
</TABLE>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
<TABLE>
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Three Months Three Months
Ended 12/31/94 Ended 12/31/93
<S> <C> <C>
Cash paid during the period for taxes $505,000 $200,000
</TABLE>
<PAGE>
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING
AND FINANCING ACTIVITIES:
During the three months ended December 31, 1993, the Company
increased additional paid-in capital by $1,514,763 which
represents the tax benefit attributable to the compensation
received by employees from the exercise and disqualifying
disposition of incentive stock options.
During the three months ended December 31, 1994, the Company
included in equity $644,922 of net unrealized losses on
investments available for sale (net of taxes). See Note 4
below.
See Notes to Condensed Unaudited Consolidated Financial
Statements.
BALLARD MEDICAL PRODUCTS AND SUBSIDIARIES
NOTES TO CONDENSED UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
1. In management's opinion, the accompanying condensed
unaudited consolidated financial statements contain all
adjustments (consisting only of normal recurring
accruals) necessary to present fairly the financial
condition of Ballard Medical Products and Subsidiaries as
of December 31, 1994 and September 30, 1994, the results
of operations for the three months ended December 31,
1994 and 1993, and the cash flows for the three months
ended December 31, 1994 and 1993.
2. The results of operations for the three months ended
December 31, 1994 are not indicative of the results to be
expected for the full year ended September 30, 1995.
3. On December 28, 1994, the Company paid a cash dividend of
$.06 per share to shareholders of record as of December
12, 1994.
4. On October 1, 1994, the Company adopted Statement of
Financial Accounting Standards No. 115 (SFAS 115),
"Accounting for Certain Investments in Debt and Equity
Securities". SFAS 115 requires the Company to classify
its investment securities as either held to maturity,
available for sale, or trading. At December 31, 1994,
the Company considers all of its investment securities to
be available for sale and, as such, accounts for its
investments at fair value with any tax-affected
unrealized gain or loss reported as a separate component
of stockholders' equity. The adoption of SFAS 115 on
October 1, 1994, resulted in a decrease in the carrying
values of investments available for sale of approximately
$1,036,000, as of October 1, 1994, with a corresponding
decrease in stockholders' equity and increase in deferred
taxes receivable of approximately $659,000 and $377,000,
respectively. Implementation of SFAS 115 will result in
additions to or deductions from total stockholders'
equity as the result of fluctuations in fair value.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Company's 1994 Annual Report to Shareholders contains
management's discussion and analysis of financial condition and
results of operations at and for the year ended September 30,
1994. The following discussion and analysis describes material
changes in the Company's financial condition and position from
September 30, 1994. Trends of a material nature are discussed
to the extent known and considered relevant. The analysis of
results of operations compares the three months ended December
31, 1994 with the corresponding period of 1993. This analysis
should be considered in conjunction with the condensed
unaudited consolidated balance sheets, condensed unaudited
consolidated statements of operations, and condensed unaudited
consolidated statements of cash flows.
RESULTS OF OPERATIONS
OVERVIEW - The Company's net sales for the first quarter
of fiscal year 1995 were at a record level, increasing more
than 15% over the corresponding period of fiscal year 1994 and
more than 47% higher than the previous quarter ended September
30, 1994. The Company's net income for the first quarter was
strong with after tax profits of 24.7% of net sales, compared
with 10.3% for the previous quarter.
SALES - Net sales for the three months ended December
31, 1994 increased 15.4% to $18,510,229, compared with
$16,035,355 for the corresponding period in fiscal year 1994.
Net sales have increased principally due to better market
penetration by the Company's expanded sales force resulting in
increased sales of the TRACH CARE custom kits and MIC enteral
feeding catheters. The Company hopes that the remaining
quarters of fiscal year 1995 will continue a pattern of growth
and profitability.
There were no price increases during the three months
covered by this report; therefore, the increase in sales is
attributable primarily to an increased volume of products sold.
All sales of the Company and related receipts were in
U.S. dollars. Export sales to unaffiliated customers from the
Company's domestic operations did not exceed 10 percent of the
Company's domestic consolidated sales.
COST OF PRODUCTS SOLD - Cost of products sold for the
three months ended December 31, 1994 was $6,218,877 compared to
$4,849,317 for the corresponding period of 1993. As a
percentage of net sales, cost of products sold for the three
months ended December 31, 1994, compared to 1993, increased
3.3% from 30.2% to 33.5%. The increase reflects the initially
higher costs of introducing new products to the market, as well
as anticipated higher manufacturing overhead costs and variable
changes in sales mix.
<PAGE>
OPERATING EXPENSES - Operating expenses consist of
selling, general, and administrative expenses, research and
development expenses, and royalty expenses. Total operating
expenses for the three months ended December 31, 1994 were
$6,188,188 which represents an increase of 9.5% over the
corresponding period of 1993.
The increase in operating expenses is due primarily to
increased selling, general, and administrative expenses which
increased from $4,949,201 in the quarter ended December 31,
1993 to $5,356,123 in the quarter ended December 31, 1994.
These increased costs reflect the increased level of sales. As
a percentage of net sales, selling, general, and administrative
expenses decreased from 30.9% in the quarter ended December 31,
1993 to 28.9% in the quarter ended December 31, 1994.
Research and development and royalty expenses as a
percentage of net sales remained relatively consistent between
the periods.
OTHER INCOME - Other income consists principally of
interest income from investments and royalty income from the
licensing of the TRACH CARE closed suction system. For the
three months ended December 31, 1994 other income totaled
$911,300, compared to $1,060,151 for the three months ended
December 31, 1993. The decrease primarily reflects a reduction
in royalty income.
NET INCOME - Net income for the three months ended
December 31, 1994 increased 6.4% to $4,566,464, compared to
$4,291,986 for the three months ended December 31, 1993. The
increase in net income reflects the growth in net sales. As a
percentage of net sales, net income for the three months ended
December 31, 1994 was strong, at 24.7%.
LIQUIDITY AND CAPITAL RESOURCES
The Company's balance sheet and financial condition have
never been stronger. At December 31, 1994 the Company's
current assets exceeded its current liabilities by $59,738,555,
a current ratio of 19.8 to 1.0. The Company had $33,687,917 in
cash, cash equivalents, and investments available for sale at
December 31, 1994, an increase of $2,247,550 since September
30, 1994. Cash flows from operations totaled $5,477,147 for
the quarter ended December 31, 1994. Stockholders' equity
increased by $2,414,310 during the three months ended December
31, 1994, going from $90,433,499 at September 30, 1994 to
$92,847,809 at December 31, 1994.
In addition to its strong liquid position and equity
balance, the Company does not have any long-term debt nor does
it intend to utilize debt to fund future expansion. The
Company maintains a $4,000,000 unsecured line of credit with
its bank but has never drawn on this line. Continued growth in
cash, cash equivalents, and investments provides the Company
financial stability and flexibility to fund current operations,
acquisitions, future growth, and expansion, and to continue its
dividend payment policy.
<PAGE>
At December 31, 1994, trade receivables totaled
$14,838,393, compared to $13,505,173 at September 30, 1994.
The increase in receivables reflects the increase in net sales
for the period.
Inventories at December 31, 1994 were $8,609,268, a
decrease of $1,064,368 since September 30, 1994. The decrease
in inventory levels reflects the changes made in the Company's
distribution system as well as a normalizing of hospital and
distributor purchasing.
No significant commitments for the purchase of inventory
or property or equipment existed as of December 31, 1994.
During the three months ended December 31, 1994, the
Company paid cash dividends totaling $1,582,286.
RISK FACTORS
The following risks should be considered in evaluating
the Company and its shares and the foregoing financial
information:
COMPETITION. A number of well-established medical
products companies, both in the United States and abroad, with
substantially greater capital resources and larger research and
development staffs and facilities, and with substantially
greater marketing systems, are engaged in the manufacture and
sale of products which compete with products of the Company,
and such other companies are engaged in research designed to
reach goals similar to the Company's. Such companies may
succeed in developing and marketing similar products which are
better or more cost effective than those of the Company and its
subsidiaries and also may prove to be more successful than the
Company in the manufacturing and marketing of their products.
In recent months, the Company has reduced pricing for certain
products in order to meet competition and the price reductions
demanded by hospitals. In the future, the results of the
Company's operations could continue to be impacted by increased
competition and continuing pricing pressures.
PATENTS. The Company owns certain patents and
proprietary information acquired while developing its products,
and the Company is the licensee of certain other technology.
One of the Company's early U.S. TRACH CARE patents has
expired. As patents expire, more competing products may be
released into the marketplace by other companies. The ability
of the Company to continue to compete effectively with other
medical device companies may be materially dependent upon the
protection afforded by its patents and the confidentiality of
certain proprietary information. There is no assurance that
patents will be issued for products and product improvements
recently released into the marketplace or for products
presently being developed. If patents of the Company are
challenged, an adverse ruling could materially adversely affect
the Company's sales and profits.
<PAGE>
HEALTH CARE REFORM. Threatened government-mandated
reforms continue to cause concern and uncertainty throughout
the health care industry. The Company's future results of
operations could be severely impacted by government reforms
such as strict cost controls and other possible restrictions
being considered by federal and state law makers.
RESEARCH AND DEVELOPMENT. In the continuing discovery
and development of products, the Company spent $461,565 for
research and development in the three months ended December 31,
1994, and $1,638,475, $1,345,052 and $1,047,048 in the years
ended September 30, 1994, 1993, and 1992, respectively. The
Company plans to continue spending substantial sums for
discovery, research and development of products and
improvements of existing products. There is no assurance that
research and development expenditures in the past or in the
future will result in products which are commercially viable so
as to recoup related research and development costs or to allow
the Company to continue to grow and be profitable.
TECHNOLOGICAL CHANGE. The medical technology as utilized
by the Company has been subject to rapid advances. While the
Company feels that it currently possesses the technology
necessary to carry on its business, its commercial success will
depend on its ability to remain current with respect to such
technological advances and to retain experienced technical
personnel. Furthermore, there can be no assurance that other
technological advances will not render the Company's technology
and certain products uneconomical or obsolete.
FDA REGULATION. Certain Company products are regulated
by the United States Food and Drug Administration (FDA). The
Company is required to adhere to existing standards for good
manufacturing practices and to engage in extensive record
keeping and reporting. The Company may be subject to
additional FDA rules and regulations depending on the future
products it develops. While the Company believes it will be
able to satisfy FDA requirements with respect to its proposed
and existing products, there can be no assurance that
difficulties or excessive costs will not be encountered in the
Company's efforts to secure necessary FDA approvals which would
delay or preclude the Company from releasing and marketing such
products. In addition, the extent of governmental regulation
which may arise from future legislative or administrative
action cannot be predicted.
FOREIGN REGULATION. Company products face a wide variety
of existing difficult regulations and a changing regulatory
environment in foreign countries. For example, in Europe,
there is significant pressure to achieve compliance with
international quality standards and to obtain various
certifications which are available at great effort and expense
to the Company. There can be no assurance that the Company
will be successful at obtaining such certifications so as to be
able to sell and distribute its products in international
markets such as Europe, or that the Company will be able to
satisfy international standards and regulations. Failure to do
so may severely impair the Company's sales growth in
international markets.
<PAGE>
PRODUCT LIABILITY. The Company's products are intended
to be used on or around humans by competent medical personnel.
In the event a patient develops medical problems in connection
with the Company's products, the Company could be liable for
substantial damages. The Company has product liability
insurance, but there is no assurance that the Company would not
be materially adversely affected from any claim which may be
made, or judgment which may be entered, against it.
LACK OF DIVIDENDS. Prior to January, 1990, no dividends
had been paid by the Company on its shares of Common Stock.
The Company has paid dividends since January, 1990. However,
there can be no assurance that dividends will be paid on shares
in the future, particularly since the Company prefers to
reserve its cash and liquid assets for possible business
acquisitions.
UNCERTAINTY OF FINANCIAL RESULTS AND CAPITAL NEEDS.
There may be substantial fluctuations in the Company's results
of operations because of the timing and receipt of revenues and
market acceptance of existing Company products. The ability of
the Company to expand its manufacturing and marketing
operations cannot be predicted with certainty. If revenues do
not continue to increase as rapidly as they have in the past
few years, or if manufacturing, marketing, research and
development are not successful or require more money than is
anticipated, the Company may have to scale back product
marketing, development and production efforts and attempt to
obtain additional financing. There can be no assurance that
the Company would be able to obtain timely additional financing
in the amounts required or that such financing, if available,
would be on terms advantageous to the Company.
SUPPLY OF RAW MATERIALS. Certain of the Company's
products are dependent upon raw materials for which there are
single or few sources. So far, the Company has not had any
serious problems obtaining needed raw materials. However,
there can be no assurance that the Company will be able to
continue to depend on existing sources of certain materials.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
GUARDIANSHIP OF CARMEN MARIE SMOOT
v. BALLARD MEDICAL PRODUCTS, ET AL.
On or about December 21, 1994, Adolph W. Smoot, Sr. and
Rosalia C. Smoot (heirs of Carmen Marie Smoot) filed a Petition
in Intervention in this litigation, adding wrongful death
claims. The Company continues to be defended in this case by
counsel appointed by its insurance carrier, and believes that
any possible judgment in this case would be covered by its
product liability insurance.
Otherwise, no material developments have occurred in this
litigation since the filing of the Company's Form 10-K for the
year ended September 30, 1994. The parties continue to engage
in the discovery process.
<PAGE>
BALLARD MEDICAL PRODUCTS
v. HUNTINGTON LABORATORIES, INC.
On February 3, 1995, Judge Jenkins granted Ballard's
motion for partial summary judgment, ruling that Huntington's
foaming device literally infringes two claims of Ballard's
Reissue Patent No. 33,564. This is a significant ruling in
Ballard's favor, disposing of the key issue in the case without
the need of a jury trial.
Remaining issues in the litigation between Ballard and
Huntington are still pending. For example, Ballard's claim for
patent infringement damages has not yet been resolved by the
court.
OTHER LITIGATION
The Company is also a party to ordinary routine
litigation incidental to the Company's business.
ITEM 2. CHANGES IN SECURITIES
There are no changes in the rights of the holders of
common stock.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There are no senior securities of the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The following information describes matters submitted to
a vote of the security holders:
(a) The 1995 Annual Meeting of Stockholders was
held January 23, 1995 at the principal executive offices of the
Company, 12050 Lone Peak Parkway, Draper, Utah.
(b) At the Annual Meeting of Stockholders, the
following persons were elected as Directors, constituting all
of the Directors of the Company, and also constituting all of
management's nominees in the Proxy Statement mailed to
stockholders and filed with the Securities and Exchange
Commission prior to the Annual Meeting of Stockholders:
Dale H. Ballard E. Martin Chamberlain
John I. Bloomberg Dale H. Ballard, Jr.
J. Dallas VanWagoner Paul W. Hess
Robert V. Petersen
(c) It was proposed to the security holders to
approve the Company's adoption of the 1994 Incentive Stock
Option Plan. The Plan was approved by the following vote:
Affirmative votes cast 18,920,742
Negative votes cast 4,136,854
Abstaining votes 370,026
<PAGE>
(d) It was proposed to amend all of the
outstanding incentive stock option plans of the Company to
provide for immediate vesting (i.e., exercisability) of options
upon occurrence of a business combination not approved by a
two-thirds vote of Continuing Directors. This amendment was
approved by the following vote:
Affirmative votes cast 21,561,761
Negative votes cast 1,256,252
Abstaining votes 609,614
ITEM 5. OTHER INFORMATION
The Company has no information to report under this item.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Statements concerning computation of income per
share are included in the financial information provided in
Item 1 of Part I and are incorporated by reference into this
Item 6 of Part II of this report.
(b) No reports on Form 8-K were filed during the period
covered by this Form 10-Q.
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 of the undersigned thereunto duly
authorized.
BALLARD MEDICAL PRODUCTS
(Registrant)
Date: 2/14/95 Dale H. Ballard, President
Date: 2/14/95 Kenneth R. Sorenson,
Chief Accounting Officer
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT PAGE NO.
<S> <C> <C>
27 Financial Data Schedule 16
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the first
quarter 10-Q and is qualified in its entirety by reference to such 10-Q.
</LEGEND>
<S> <C>
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