<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - QSB
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended June 30, 1997
( ) TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Transition Period from _____________ to _______________
Commission file number 000-18448
AMERICAN CONSOLIDATED LABORATORIES, INC.
(Name of small business issuer in its charter)
FLORIDA 59-2624130
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1640 NORTH MARKET DRIVE, RALEIGH, NORTH CAROLINA 27609
(Address of principal executive offices) (Zip code)
(919) 872- 0744
Issuer's telephone number
Check mark whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.
Yes (X) NO
The number of shares outstanding of the registrants Common Stock, par value
$0.05 per share, at July 31, 1997 was 7,757,962 shares.
Transitional Small Business Disclosure Format (check one): Yes ____; No X
<PAGE>
PART 1 - FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS FOR THE PERIOD ENDED JUNE 30, 1997
(unaudited)
(Begins on the following page)
<PAGE>
AMERICAN CONSOLIDATED LABORATORIES, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
JUNE 30,
1997 DECEMBER
(UNAUDITED) 31, 1996
---------------- ----------------
<S> <C> <C>
CURRENT ASSETS:
Cash $ 314,548 $ -
Accounts receivable, less allowance
for doubtful accounts (note 2) 304,871 644,157
Inventories, at lower of cost (first in,
first out) or market (note 3) 338,453 708,152
Other current assets 21,743 115,408
---------------- ----------------
Total current assets 979,615 1,467,717
---------------- ----------------
PROPERTY AND EQUIPMENT AT COST:
Laboratory equipment 1,031,425 871,167
Office and computer equipment 216,990 216,990
Leasehold improvements 56,024 56,024
Assets being held for disposition - 255,000
---------------- ----------------
Total property and equipment 1,304,439 1,399,181
Less accumulated depreciation 932,880 915,942
---------------- ----------------
Property plant and equipment, net 371,559 483,239
---------------- ----------------
TOTAL ASSETS $ 1,351,174 $ 1,950,956
================ ================
</TABLE>
See notes to consolidated financial statements
<PAGE>
AMERICAN CONSOLIDATED LABORATORIES, INC.
CONSOLIDATED BALANCE SHEETS (Continued)
LIABILITIES AND STOCKHOLDERS' DEFICIT
<TABLE>
<CAPTION>
JUNE 30,
1997 DECEMBER
(UNAUDITED) 31, 1996
------------------- ----------------
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 897,747 $ 1,433,469
Accrued expenses 307,213 742,766
Current maturities of long-term debt 127,817 2,012,733
Revolving credit line (note 4) 0 390,591
------------------- ----------------
Total current liabilities 1,332,777 4,579,559
------------------- ----------------
LONG - TERM DEBT (note 4): 2,701,880 395,171
DEFERRED RENT 48,537 52,597
COMMITMENTS AND CONTINGENCIES (note 1)
STOCKHOLDERS' DEFICIT (note 1)
Preferred Stock, $1.00 stated value, 10% dividend payable
in kind, 5,000,000 shares authorized;
4,897,429 issued at June 30, 1997 4,897,429 -
Common stock, $.05 par value, 20,000,000
shares authorized; 8,377,962 issued and 7,757,962
shares outstanding at June 30, 1997, and 4,621,623
issued and 4,005,623 shares outstanding at December 31, 1997 418,898 231,082
Capital in excess of par 9,812,195 6,220,273
Unallocated purchase price in excess of cost (note 6) (7,477,778) -
Treasury Stock (335,000) (328,000)
Deficit (10,047,764) (9,199,726)
------------------- ----------------
Total stockholders' deficit (2,732,020) (3,076,371)
------------------- ----------------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 1,351,174 $ 1,950,956
=================== ================
</TABLE>
See notes to consolidated financial statements
<PAGE>
AMERICAN CONSOLIDATED LABORATORIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
----------------------------------- ---------------------------------
1997 1996 1997 1996
----------------------------------- ---------------------------------
<S> <C> <C> <C> <C>
NET SALES $ 856,722 $ 1,171,120 $ 1,761,988 $ 2,446,740
COST OF SALES 488,266 718,657 1,032,446 1,219,073
---------------------------------- ---------------------------------
Gross profit 368,456 452,463 729,542 1,227,667
---------------------------------- ---------------------------------
OPERATING COSTS AND EXPENSES:
Selling expenses 100,929 89,611 171,014 246,164
Marketing expenses 60,355 16,444 174,992 41,259
Research and development 7,514 10,959 7,514 24,958
General and administrative expenses 457,980 695,203 851,153 1,387,859
---------------------------------- ---------------------------------
Total operating costs and expenses 626,778 812,217 1,204,673 1,700,240
---------------------------------- ---------------------------------
Operating loss (258,323) (359,754) (475,131) (472,573)
OTHER INCOME (EXPENSES):
Interest expense (139,907) (85,126) (372,256) (143,783)
Other income 92,235 11,465 107,320 25,537
---------------------------------- ---------------------------------
Loss before non-reoccurring costs (305,995) (433,415) (740,067) (590,819)
Income (loss) from discontinued operations (note 5) (58,082) 81,785 (107,971) 3,937
---------------------------------- ---------------------------------
Loss before income taxes (364,077) (351,630) (848,038) (586,882)
INCOME TAXES - - - -
---------------------------------- ---------------------------------
NET LOSS $ (364,077) $ (351,630) $ (848,038) $ (586,882)
================================== =================================
Deficit at beginning of period (9,683,687) (6,050,207) (9,199,726) (5,814,955)
---------------------------------- ---------------------------------
Deficit at end of period $ (10,047,764) $ (6,401,837) $(10,047,764) $(6,401,837)
================================== =================================
Net loss per common share - primary (note 7) ($0.07) ($0.08) ($0.16) ($0.14)
================================== =================================
Weighted average shares outstanding - primary 5,268,509 4,309,052 5,268,509 4,309,052
================================== =================================
</TABLE>
See notes to consolidated financial statements
<PAGE>
AMERICAN CONSOLIDATED LABORATORIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended June 30, 1997 and 1996
<TABLE>
<CAPTION>
1997 1996
------------------ -----------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (848,038) $ (586,882)
Adjustments to reconcile net loss to net cash
(used in) provided by operating activities:
Depreciation 67,793 89,129
Amortization of intangibles - 130,979
Discount amortization 89,309 -
Gain on sale of Lincoln facility 75,313 -
Decrease in accounts receivable 339,286 18,230
Decrease in inventories 369,699 387,627
Decrease(Increase) in other current assets 93,665 (162,928)
Decrease in accounts payable (535,722) (189,130)
Decrease in accrued expenses (448,390) (78,728)
Decrease in deferred rent (4,060) (2,699)
------------------ -----------------
Net cash used in operating activities (801,145) (394,402)
------------------ -----------------
Cash flows from investing activities:
Additions to property and equipment - (17,064)
Disposal of Lincoln land and building -net book value 174,687 -
------------------ -----------------
Net cash from(used) in investing activities 174,687 (17,064)
------------------ -----------------
Cash flows from financing activities:
Proceeds from borrowings 1,666,440 1,182,456
Principal payments on debt and repayment of
revolving line of credit (702,979) (246,031)
Principal payments under capital leases - (27,762)
Purchase of treasury stock (7,000) (150,000)
Issuance of common stock 1,379 96,062
------------------ -----------------
Net cash provided by financing activities 957,840 854,725
------------------ -----------------
Net increase in cash and cash equivalents 331,382 443,259
Cash at beginning of period (16,834) 37,772
------------------ -----------------
Cash at end of period $ 314,548 $ 481,031
================== =================
</TABLE>
See notes to consolidated financial statements
<PAGE>
AMERICAN CONSOLIDATED LABORATORIES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
As of and for the Three Months Ended June 30, 1997
1. Basis of presentation and description of business
Nature of business
American Consolidated Laboratories, Inc. (the "Company") or (the
"Registrant") is in the business of manufacturing rigid gas permeable and
specialty soft contact lenses. The Company is headquartered in Raleigh, North
Carolina with operations in Sarasota, Florida and Philadelphia, Pennsylvania.
The accompanying consolidated financial statements 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. The consolidated financial
statements do not include any adjustments relating to the recoverability and
reclassification of assets and liabilities that might be necessary should the
Company be unable to continue as a going concern.
On May 7, 1997, the Company consummated the acquisition of NovaVision,
Inc. ("NovaVision") for stock through a subsidiary merger. An aggregate of
3,561,906 shares of the Company's common stock and a total of 4,897,429 shares
of the Company's Series A Redeemable Preferred Stock ("Preferred Stock") were
issued in the Transaction. Of the 4,897,429 Preferred Shares, 2,088,273 where
issued to Tullis-Dickerson Capital Focus Limited Partnership
("Tullis-Dickerson") in exchange for the conversion of $2,088,273 in debt and
accrued interest, the remaining 2,809,156 Preferred Shares were issued to
existing NovaVision Preferred Series A stockholders. In connection with this
transaction, the Company entered into a loan agreement with Sirrom Investments,
Inc. ("Sirrom"), pursuant to which the Company borrowed $1,575,000. A portion of
the proceeds from this financing was used to completely repay the Company's debt
to Fidelity Funding. The remainder of the funds will be used for general
corporate purposes. The Company believes that the acquisition of NovaVision and
the Sirrom loan will assist it in meeting its current obligations and provide
working capital as the Company works toward achieving positive cash flow.
The acquisition of NovaVision reaffirms the Company's intention to execute a
roll-up strategy within the rigid gas permeable ("RGP") industry. In addition,
as part of the NovaVision acquisition the Company also obtained several patents.
The first, for a new generation NovaVision Product, called Nova III, which the
Company believes will provide distinct clinical advantages to the wearers. The
second for a Collagen technology, from which the Company envisions developing a
family of proprietary ophthalmic products. The Company is now in a position to
pursue a dual strategy of executing a roll-up within the RGP industry while
simultaneously developing technology, either of which could enable the Company
to obtain positive cash flow.
<PAGE>
Management is working to achieve positive cash flow from operations by
reviewing and adjusting sales prices to provide acceptable profit margins,
rescheduling its current obligations and significantly cutting costs. In
addition, on May 15, 1997 the Company decided, for strategic reasons, to
discontinue the distribution of commodity soft lenses produced by the major
manufacturers, Bausch & Lomb, Wesley-Jessen, Ciba-Geigy and Johnson & Johnson.
The profit margins had declined to a point where the Company could no longer
distribute these products at acceptable profit margins.
Basis of presentation
The consolidated financial statements include the accounts of the
Company and its subsidiaries, NovaVision, Inc., Salvatori Ophthalmic
Manufacturing Corporation ("SOMC"), S-O Nebraska, Inc. ("Lincoln"), and Carolina
Contact Lens, Inc. ("CCL"). Certain prior period balances have been reclassified
to conform to the current period presentation.
2. Accounts receivable
Accounts receivable consists of the following at June 30, 1997 and
December 31, 1996:
1997 1996
-------- --------
Trade receivables $624,543 $976,693
Less allowances:
Doubtful accounts 157,069 156,780
Sales returns 162,603 175,756
-------- --------
Net receivables $304,871 $644,157
======== ========
3. Inventories
Inventories consist of the following at June 30, 1997 and December 31,
1996:
1997 1996
-------- --------
Raw materials $167,625 $171,738
Work in process 16,932 21,562
Finished goods 153,896 514,852
-------- --------
Total $338,453 $708,152
======== ========
<PAGE>
4. Long-term debt
Tullis-Dickerson, provided additional loan advances during the quarter
ended June 30, 1997 of $40,000. These advances where made prior to the
NovaVision acquisition on the same terms and conditions as the advances made
during 1996.
Effective with the NovaVision acquisition on May 7, 1997,
Tullis-Dickerson converted $2,088,273 in debt and accrued interest into
Preferred Stock of the Company. The Company assumed $520,000 of NovaVision debt
with Sirrom. In addition, the Company entered into a loan agreement with Sirrom
for $1,575,000. The Sirrom note is a five year 13.5% interest only note due
April 25, 2002. A portion of the proceeds from this loan were used to completely
repay the revolving credit line with Fidelity Funding.
5. Loss from discontinued operations
In May, the Company decided for strategic reasons to discontinue the
distribution of commodity soft lenses produced by the major manufacturers,
Bausch & Lomb, Wesley-Jessen, Ciba-Geigy and Johnson & Johnson. The profit
margins had declined to a point where the Company could no longer distribute
these products at acceptable profit margins. This has been reflected as a
discontinued operation in accordance with APB #30.
The assets of this business segment were separate from the assets used
in the manufacture of RGP and specialty soft lenses. The customer base buying
the distributed product was completely different and distinct from the
manufactured lens customer base. The revenue and expenses associated with this
segment of the business had been accounted for separately in order to properly
monitor and effectively manage the distribution business. The distribution
segment was a high volume low margin segment in contrast to the manufactured
segment, which is a specialty product characterized by lower volume and higher
margins.
6. Nova acquisition
The unallocated purchase price in excess of the cost, from the
acquisition has been reflected in the equity section of the balance sheet. The
unallocated purchase price of $7,477,778 represents the net of the assets
acquired of $311,872 (cash, receivables, inventory and fixed assets) less the
liabilities acquired of $823,557 (trade payables, accrued liabilities and
long-term debt) and the issuance of the Preferred Stock issued at the stated
value of $1.00 per share and the Common Stock issued at the market value on
May 7, 1997 of $1.00, as quoted by the National Quotation Bureau, LLC.
A valuation of the acquisition is in the process of being conducted.
Due to the complexity of the transaction and financial condition of both
companies prior to acquisition, the valuation is not yet complete. Once complete
any adjustments, if necessary, will be made.
<PAGE>
7. Loss per share
Loss per share was computed based upon the weighted average number of
shares outstanding during the period. Loss per share is presented on a primary
basis only, since on a fully diluted basis it would be anti-dilutive.
8. Subsequent Event
The Company plans to consolidate all the Company's manufacturing
into the Sarasota location during the third quarter. It is projected the cost of
severance, settling various contractual arrangements and the relocation of the
equipment will cost the Company $153,000 over the third and fourth quarters.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
General
Management's discussion of the results of operations for the three and six month
periods ended June 30, 1997 and 1996 refer to the Company's continuing
operations as presented in the consolidated financial statements. The 1996
information has been restated to reflect the presentation of the discontinued
operations.
Results of Operations - Three Months Ended June 30, 1997 Compared to Three
Months Ended June 30, 1996
Net sales for the three months ended June 30, 1997 totaled $856,722, a
decrease of $314,398 or 26.8% from the comparable period in 1996. The decrease
is primarily due to two factors; the first is the loss of a specialty
manufactured soft lens customer which accounts for approximately $186,000 of the
decline; the second is the loss of certain local Lincoln customers that had done
business with the Lincoln facility prior to it being integrated into the Raleigh
and Sarasota facilities, which accounts for approximately $46,000 of the
decline.
The gross profit was $368,456, or 43.0% of net sales for the quarter
ended June 30, 1997 compared to $452,463, or 38.6% for the comparable period in
1996. The improvement in the gross margin percentage is the result of
management's actions to evaluate and position selling prices to provide
acceptable profit margins.
Total operating expenses of $626,778 for the quarter ended June 30,
1997 were $185,439, or 22.8% lower than the $812,217 for the quarter ended June
30, 1996. The improvement is the result of cost cutting measures taken in the
fourth quarter of 1996. On October 1, 1996, there was a 13% reduction in work
force, and on November 15, 1996, the Lincoln, Nebraska manufacturing facility,
was consolidated into the Sarasota and Raleigh facilities. These two actions
contributed significantly to the reduced level of operating expenses.
The Company incurred an operating loss of $258,323 for the three months
ended June 30, 1997 compared to an operating loss of $359,754 for the three
months ended June 30, 1996. The reduction in the loss was due to the higher
gross profit margin and the reduction in operating expenses.
Interest expense for the three months ended June 30, 1997 totaled
$139,907, compared to $85,126 for the comparable period in the prior year. This
increase is due to the increased borrowings incurred to support the prior
losses, current operations and the impact of the amortization of the discount
associated with warrants issued to Fidelity Funding in 1996 in connection with
the Company's former revolving credit line.
<PAGE>
Results of Operations - Six Months Ended June 30, 1997 Compared to Six Months
Ended June 30, 1996
Net sales for the six months ended June 30, 1997 totaled $1,761,988, a
decrease of $684,752, from the comparable period in 1996. The decrease is due to
two factors; the first is the loss of a specialty manufactured soft lens
customer which accounts for approximately $422,000, of the decline; the second
is the loss of certain local Lincoln customers that had done business with the
Lincoln facility prior to it being integrated into the Raleigh and Sarasota
facilities which accounts for approximately $92,000 of the decline.
The gross profit for the six months ended June 30, 1997 was $729,542,
or 41.4% of net sales compared to $1,227,667, or 50.2% of net sales for the six
months ended June 30, 1996. The fluctuation in the gross profit percentage is
primarily due to the lost sales volume from this specialty manufactured soft
lens customer.
Total operating costs for the six months ended June 30, 1997 decreased
$495,567. The improvement is the result of cost cutting measures taken in the
fourth quarter of 1996. On October 1, 1996 there was a 13% reduction in work
force, and on November 15, 1996, the Lincoln, Nebraska manufacturing facility
was consolidated into the Raleigh and Sarasota facilities. These two actions
contributed significantly to the reduced level of operating expenses.
Interest expense for the six months ended June 30, 1997 totaled
$372,254 compared to $143,783 for the same period in 1996. This increase is due
to the increased borrowings incurred to support the prior losses, current
operations, and the impact of the amortization of the discount associated with
the Fidelity and Tullis-Dickerson warrants issued in 1996. The amortization of
the Tullis-Dickerson discount ended on March 31, 1997 and the Fidelity discount
ended on May 7, 1997.
Financial Condition
Cash used in operating activities during the first six-months of 1997
totaled $801,145 compared to $394,402 in the comparable period in 1996. For the
first six-months of 1997, cash increased $331,382. For the June 30, 1996 period,
cash increased $443,259 to $481,031.
The working capital deficit at June 30, 1997 was $353,162, which showed
a significant improvement compared to a working capital deficit of $3,111,842 at
December 31, 1996. The improvement is primarily the result of the conversion of
$2,088,273 in Tullis-Dickerson debt and interest into Preferred Stock and the
repayment of the Fidelity revolving credit line. During the quarter Sirrom
provided $1,575,000 in debt financing and Tullis-Dickerson provided cash
advances during the period totaling $175,000.
<PAGE>
Management is working to achieve positive cash flow from operations by
reviewing and adjusting sales prices to provide acceptable profit margins,
rescheduling its current obligations and significantly cutting costs. In
addition, on May 15, 1997 the Company decided for strategic reasons to
discontinue the distribution of commodity soft lenses produced by the major
manufacturers, Bausch & Lomb, Wesley-Jessen, Ciba-Geigy and Johnson & Johnson.
The profit margins had declined to a point where the Company could no longer
distribute these products at acceptable profit margins.
On May 7, 1997, the Company consummated the acquisition of NovaVision,
Inc. ("NovaVision") for stock through a subsidiary merger. An aggregate of
3,561,906 shares of the Company's common stock and a total of 4,897,429 shares
of the Company's Series A Redeemable Preferred Stock ("Preferred Stock") were
issued in the Transaction. Of the 4,897,429 Preferred Shares, 2,088,273 where
issued to Tullis-Dickerson Capital Focus Limited Partnership
("Tullis-Dickerson") in exchange for the conversion of $2,088,273 in debt and
accrued interest, the remaining 2,809,156 Preferred Shares were issued to
existing NovaVision Preferred Series A stockholders. In connection with this
transaction, the Company entered into a loan agreement with Sirrom Investments,
Inc. ("Sirrom"), pursuant to which the Company borrowed $1,575,000. A portion of
the proceeds from this financing was used to completely repay the Company's debt
to Fidelity Funding. The remainder of the funds will be used for general
corporate purposes. The Company believes that the acquisition of NovaVision and
the Sirrom loan will assist it in meeting its current obligations and supply
working capital as the Company works toward achieving positive cash flow.
The acquisition of NovaVision reaffirms the Company's intention to execute a
roll-up strategy within the rigid gas permeable ("RGP") industry. In addition,
as part of the NovaVision acquisition the Company obtained several patents.
The first, for a new generation NovaVision Product, called Nova III, which the
Company believes will provide distinct clinical advantages to the wearers. The
second for a Collagen technology, from which the Company envisions developing a
family of proprietary ophthalmic products. The Company is now in a position to
pursue a dual strategy of executing a roll-up within the RGP industry while
simultaneously developing technology, either of which could enable the Company
to obtain positive cash flow.
Certain matters discussed in this report may contain forward-looking statements
that are subject to risks and uncertainties that could cause actual results to
differ from those discussed. Any forward-looking statements contained in this
document reflect management's current intentions and expectations. However,
management makes no representations or assurances that these intentions or
expectations will be realized.
<PAGE>
PART II
ITEM 6. EXHIBITS AND REPORT ON FORM 8-K
(a) The exhibits to this Form 10-QSB are listed on the accompanying
Index to Exhibits.
(b) The Company filed Form 8-K for its May 7, 1997 acquisition of
NovaVision on May 21, 1997 and the loan agreement entered into
with Sirrom immediately after the merger. The Registrant is in
the process of having the financial statements of NovaVision
audited for the two years ended December 31, 1996 and 1995.
NovaVision did not have audited financial statements.
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed by the undersigned, thereunto duly authorized.
American Consolidated Laboratories, Inc.
Date:____________________ By:______________________________
Joseph A. Arena
Chief Executive Officer
Date:____________________ By:______________________________
Kenneth C. Kirkham
Chief Financial Officer
<PAGE>
ITEM 6 (a) INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description Incorporated by reference
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
2. Agreement and Plan of Exhibit 2 to Report on Form 8-K dated May 7, 1997
Merger by and among
NovaVision, Inc., Bart
Gutekunst, the Registrant and
NV Acquisition, Inc. dated
May 7, 1997
3.1 Articles of Incorporation and Exhibit 3.1 to quarterly Report on Form 10-Q for
subsequent amendments of quarter ended March 31, 1997
registrant
3.2 Articles of Merger of Exhibit 3 (a)(2) to Report on Form 8-K dated May 7,
NovaVision, Inc. into NV 1997
Acquisition, Inc. dated May
8, 1997
3.3 Bylaws of the registrant Exhibit 10.2 to quarterly Report on Form 10-Q for
quarter ended March 31, 1997
4.1 Term Note between Registrant Exhibit 10.2 to quarterly Report on Form 10-Q for
and TDCFLP, September 16, quarter ended September 30, 1991
1991
4.2 Secured Convertible Term Exhibit 6 to Current Report on Form 8-K, dated
Promissory Note between December 29, 1994
Registrant and TDCFLP
December 15, 1994; and
Stock Purchase and Term
Loan Agreement between
Registrant and TDCFLP,
dated August 15, 1994
4.3 Secured Convertible Term Exhibit 10.11 to Form 10-KSB for the year ended
Promissory Note dated as of December 31, 1995
December 14, 1994, (as
amended and restated as of
June 15, 1995) between
the Company and TDCFLP
and amendment of
Promissory Note dated February
15, 1996
<PAGE>
4.4 Amended and Restated Exhibit 10.11 to Form 10-KSB for the year ended
Convertible Promissory December 31, 1995
Note dated February 15,
1996 from the Company to
TDCFLP and related
Warrants
4.5 Loan and Security agreement Exhibit 4.5 to form 10-KSB for the year ended
between Carolina Contact Lens, December 31, 1996.
Inc. and Fidelity Funding of
California, dated as of June 25,
1996
4.6 Loan and Security agreement Exhibit 4.6 to form 10-KSB for the year ended
between Salvatori Ophthalmic December 31, 1996.
Manufacturing Corporation and
Fidelity Funding of California,
Inc. dated as of June 25, 1996
4.7 Warrant for Purchase of Exhibit 4.7 to form 10-KSB for the year ended
securities of American December 31, 1996.
Consolidated Laboratories,
Inc. issued to Fidelity Funding
of California, Inc. in conjunction
with the Loan in Exhibits 10.9
and 10.10 for 150,000 shares
4.8 Warrant for Purchase of Exhibit 4.8 to form 10-KSB for the year ended
securities of American December 31, 1996.
Consolidated Laboratories,
Inc. issued to TDCFLP
in conjunction with Loan
advances in 1996 for
550,000 shares
4.9 Financing Agreement between Exhibit 10.1 to Quarterly Report on Form 10-Q for the
the Company, S-O Nebraska, quarter ended September 30, 1991
Inc. and TDCFLP, dated Sep-
tember 13, 1991
4.10 Loan Agreement dated as of Exhibit 4(a) to the Report on Form 8-K dated May
May 7, 1997 by and between 7, 1997
The Registrant and Sirrom
Investments, Inc.
<PAGE>
4.11 Joint and Several Exhibit 4(b) to the Report on Form 8-K dated May 7,
Unconditional Continuing 1997
Guaranty dated as of May 7,
1997 of Loan Agreement
dated as of May, 1997 by the
Registrant, NovaVision, Inc.
Biopolymer Corporation,
Salvatori Ophthalmic
Manufacturing Corporation,
S-O Nebraska, Inc., Wolcon
Labs, Inc. and Carolina
Contact Lens, Inc.
4.12 Promissory Note dated May Exhibit 4(c) to the Report on Form 8-K dated May 7,
7, 1997 by and between the 1997
Registrant and Sirrom
Investments, Inc.
4.13 Intercreditor Agreement Exhibit 4(d) to the Report on Form 8-K dated May 7,
dated May 7, 1997, among 1997
the Registrant, Tullis-
Dickerson Capital Focus,
L.P., NovaVision, Inc.
Biopolymer Corporation,
Salvatori Ophthalmic
Manufacturing Corporation,
S-O Nebraska, Inc., Wolcon
Labs, Inc. and Carolina
Contact Lens, Inc.
4.14 Security Agreement dated as of Exhibit 4(e) to the Report on Form 8-K dated May 7,
May 7, 1997, by and between 1997
the Registrant, NovaVision, Inc.
Biopolymer Corporation,
Salvatori Ophthalmic
Manufacturing Corporation,
S-O Nebraska, Inc. Wolcon
Labs, Inc. and Carolina
Contact Lens, Inc.
(collectively, the "Grantors")
and Sirrom Investments, Inc.,
as agent pursuant to that certain
Intercreditor Agreement of even
Date herewith by and between
Tullis-Dickerson Capital Focus,
L.P., Sirrom Investments, Inc.
and the Grantors.
<PAGE>
4.15 Trademark and Patent Security Exhibit 4(f) to the Report on Form 8-K dated May
Agreement dated as of May 7, 7, 1997
1997 by and between the
Registrant and Sirrom
Investments, Inc. as agent
pursuant to that certain
Intercreditor Agreement of
even date herewith by and
between Tullis-Dickerson
Capital Focus L.P., Sirrom
Investments, Inc. and the
Grantors.
4.16 Stock Pledge Agreement Exhibit 4(g) to the Report on Form 8-K dated May 7,
dated as of May 7, 1997, by 1997
and between the Registrant,
and Sirrom Investments, Inc.
as Agent pursuant to that
certain Intercreditor
Agreement of even date
Herewith by and between
Tullis-Dickerson Capital
Focus, L.P., Sirrom and
The Grantors.
4.17 Stock Purchase Warrant Exhibit 4(h) to the Report on Form 8-K dated May 7,
dated as of May 7, 1997, 1997
issued by the Registrant
to Sirrom Investments, Inc.
10 Employment Agreement Exhibit 10(a) to the Report on Form 8-K
between the Registrant dated May 7, 1997
and Bart C. Gutekunst
dated May 7, 1997
10.1 1994 Incentive and Non- Exhibit 4.1 to Form 10-KSB for the Fiscal year ended
Statutory Stock Option Plan December 31, 1994
27 Financial Data Schedule
</TABLE>
<PAGE>
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<NAME> ACL ACL
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1997 DEC-31-1997
<PERIOD-START> JAN-1-1997 APR-1-1997
<PERIOD-END> MAR-31-1997 JUN-30-1997
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0 0
0 4,897,429
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<INTEREST-EXPENSE> (232,347) (139,907)
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<INCOME-CONTINUING> (483,961) (305,995)
<DISCONTINUED> 0 (58,082)
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