UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
[X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934 For the quarterly period ended August 31, 1995
[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange Act
of 1934 For the transition period from _______________ to ______________
Commission File Number: 0-18105
VASOMEDICAL, INC.
- -------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 11-2871434
- -------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
150 Motor Parkway, Suite 408, Hauppauge, New York 11788
- ----------------------------------------------------------------------------- --
(Address of Principal Executive Offices)
Issuer's Telephone Number (516) 348-0500
--------------
Number of Shares Outstanding of Common Stock,
$.001 Par Value, at October 13, 1995 38,948,528
----------
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act 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 [ ]
Transitional Small Business Disclosure Format Yes [ ] No [X]
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
INDEX
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION
<S> <C>
Item 1 - Financial Statements: Page
Consolidated Condensed Balance Sheets as of
August 31, 1995 and May 31, 1995 (Unaudited) 3
Consolidated Condensed Statements of Operations fo
the Three Months Ended August 31, 1995 and
1994 and for the period from July 22, 1987
(inception) to August 31, 1995 (Unaudited) 4
Consolidated Condensed Statement of Changes in
Stockholders' Equity for the Three Months
Ended August 31, 1995 and for the period from
July 22, 1987 (inception) to May 31, 1995 (Unaudited) 5
Consolidated Condensed Statements of Cash Flows for
the Three Months Ended August 31, 1995 and 1994
and for the period from July 22, 1987 (inception)
to August 31, 1995 (Unaudited) 7
Notes to Consolidated Condensed Financial Statements 9
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations 11
PART II - OTHER INFORMATION 12
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
(unaudited)
August 31, May 31,
ASSETS 1995 1995
------ ---------- --------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $3,400,937 $ 491,609
Investments in marketable securities 637,822 628,152
Inventory 255,481
Other current assets 65,497 120,456
---------- ---------
Total current assets 4,359,737 1,240,217
PROPERTY AND EQUIPMENT, net 69,965 77,075
CAPITALIZED COSTS IN EXCESS OF FAIR
VALUE OF NET ASSETS ACQUIRED, net 1,371,777 1,426,065
DEFERRED LOAN COSTS, net 842,444
OTHER ASSETS 9,781 9,781
---------- ----------
$6,653,704 $2,753,138
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 339,275 $ 404,051
Accrued interest 46,667 89,096
---------- ----------
Total current liabilities 385,942 493,147
LONG-TERM DEBT 4,000,000
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value;
1,000,000 shares authorized; none
issued and outstanding - -
Common stock, $.001 par value;
85,000,000 shares authorized;
38,948,528 shares and 37,899,432
shares at August 31, 1995 and
May 31, 1995, respectively,
issued and outstanding 38,948 37,899
Additional paid-in capital 21,912,625 21,134,578
Deferred compensation (297,173) (339,626)
Unrealized loss on investments (7,717) (7,370)
Deficit accumulated in the development
stage (19,378,921) (18,565,490)
---------- ----------
2,267,762 2,259,991
---------- ----------
$6,653,704 $2,753,138
---------- ----------
<FN>
The accompanying notes are an integral part of these condensed statements.
</FN>
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Cumulative
Three months July 22, 1987
ended August 31, (inception) to
1995 1994 August 31, 1995
---- ---- ---------------
<S> <C> <C> <C>
Revenues $ - $ - $ 2,349,502
Costs and expenses
Selling, general and administrative 597,959 448,560 17,399,642
Research and development 93,209 120,000 3,555,516
Depreciation and amortization 115,609 11,411 1,041,759
Provision for uncollectable note 318,000
Royalty fees 196,963
Manufacturing expenses 614,479
Registration costs 89,797
Minority interest in net losses
of subsidiaries (1,110,221)
Net gain on sale or disposition
of subsidiaries stock (119,701)
Interest and financing costs 48,054 327 291,338
Interest and other income - net (41,400) (20,189) (549,149)
--------- --------- ------------
813,431 560,109 21,728,423
--------- --------- ------------
NET LOSS $(813,431) $(560,109) $(19,378,921)
--------- --------- ------------
Net loss per common share $(.02) $(.02)
--------- ---------
Weighted average common shares
outstanding 38,598,829 25,722,765
---------- ----------
<FN>
The accompanying notes are an integral part of these condensed statements.
</FN>
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Deficit
Unreal- Stock accumulated Total
Additional Deferred ized loss sub- in the stock-
Preferred Stock Common stock paid-in compen- on in- criptions development holders'
Shares Amount Shares Amount capital sation vestments receivable stage equity
------ ------ ------ ------ ------- ------ ---------- ---------- ----------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at July 22, 1987
(inception) - $ - - $ - $ - $ - $ - $ - $ - $ -
Issuance of common stock 7,330,355 7,330 296,215 303,545
Common stock issued for
services 169,645 170 4,919 5,089
(233,465) (233,465)
-------- ------- ---------- -------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1988 7,500,000 7,500 301,134 (233,465) 75,169
Issuance of common stock 2,500,000 2,500 2,054,246 2,056,746
Common stock issued for
services 137,500 138 39,862 40,000
Net loss (538,919) (538,919)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1989 10,137,500 10,138 2,395,242 (772,384) 1,632,996
Net loss (797,720) (797,720)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1990 10,137,500 10,138 2,395,242 (1,570,104) 835,276
Common stock issued to
consultants for
services 462,750 462 114,588 115,050
Additional paid-in capital
arising from investment
in subsidiary by minority
interest 315,241 315,241
Net loss (666,259) (666,259)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1991 10,600,250 10,600 2,825,071 (2,236,363) 599,308
Common stock issued for
services to officers/
employees and
consultants 1,632,253 1,632 1,785,794 1,787,426
Issuance of common stock
for cash 1,317,500 1,318 2,521,893
2,523,211
Common stock issued under
option agreements 225,000 225 53,910 54,135
Common stock dividend 901,553 902 (902) -
Issuance of subsidiary
stock to minority
interests pursuant to
anti-dilution provisions 304,400 304,400
Net loss (4,043,755)(4,043,755)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1992 14,676,556 14,677 7,490,166 (6,280,118) 1,224,725
Common stock issued for
services to officers/
employees and consultants 227,500 227 252,818 253,045
Issuance of common stock
for cash 8,217,876 8,218 8,216,782 (1,712,500) 6,512,500
Common stock issued to
officers under stock
bonus arrangement 1,900,000 1,900 1,696,225 (1,698,125) -
Amortization of
deferred compensation 339,625 339,625
Warrants issued to lenders
and consultants 210,000 210,000
Net loss (4,356,925)(4,356,925)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1993 25,021,932 25,022 17,865,991 (1,358,500) (1,712,500) (10,637,043) 4,182,970
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
</TABLE>
<PAGE>
<TABLE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (continued)
<CAPTION>
Deficit
Unreal- Stock accumulated Total
Additional Deferred ized loss sub- in the stock-
Preferred Stock Common stock paid-in compen- on in- criptions development holders'
Shares Amount Shares Amount capital sation vestments receivable stage equity
------ ------ ------ ------ ------- ------ ---------- ---------- ----------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at May 31, 1993 - $ - 25,021,932 25,022 17,865,991 (1,358,500) (1,712,500)(10,637,043)4,182,970
Rescission of common stock
underlying stock
subscriptions receivable (1,712,500) (1,713) (1,710,787) 1,712,500 -
Issuance of common stock
for cash 2,500,000 2,500 947,500 950,000
Common stock
issued for services to
officers and consultants 555,000 555 416,539 417,094
Issuance of common stock of
subsidiary for services 120,667 120,667
Contribution of common stock
of subsidiaries by officers 135,329 135,329
Contribution of common stock
by officer and consultant (300,000) (300) 300 -
Warrants issued to officers/
employees and consultants 193,500 193,500
Amortization of deferred
compensation 339,624 339,624
Net loss (4,811,153)(4,811,153)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1994 26,064,432 26,064 17,969,039 (1,018,876) - - (15,448,196)1,528,031
Unvested common stock
forfeited under stock
bonus arrangement (570,000) (570) (508,868) 509,438 -
Issuance of common stock
for cash 6,000,000 6,000 1,481,625 1,487,625
Issuance of preferred
stock for cash 500,000 5,000 382,625 387,625
Conversion of preferred
stock (500,000) (5,000) 1,000,000 1,000 4,000 -
Issuance of common stock
to acquire subsidiary 5,000,000 5,000 1,460,000 1,465,000
Common stock issued for
services to consultants 405,000 405 273,657 274,062
Warrants issued to directors
and consultants 72,500 72,500
Amortization of deferred
compensation 169,812 169,812
Unrealized loss on investments (7,370) (7,370)
Net loss (3,117,294)(3,117,294)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at May 31, 1995 - - 37,899,432 37,899 21,134,578 (339,626) (7,370) - (18,565,490) 2,259,991
Common stock issued to
consultant in
connection with
debt financing 600,000 600 599,400 600,000
Common stock issued in
lieu of cash interest 89,096 89 89,007 89,096
Exercise of warrants 360,000 360 89,640 90,000
Amortization of deferred
compensation 42,453 42,453
Unrealized loss on
investments (347) (347)
Net loss (813,431) (813,431)
-------- -------- ---------- --------- --------- --------- --------- --------- --------- ---------
Balance at
August 31, 1995 - - 38,948,528 $38,948 $21,912,625 $(297,173) $(7,717) $ - $(19,378,921)$2,267,762
-------- -------- ---------- -------- ----------- --------- --------- --------- ----------- ---------
<FN>
The accompanying notes are an integral part of this condensed statement
</FN>
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Cumulative
July 22, 1987
Three months ended August 31, (inception) to
1995 1994 August 31,1995
---- ---- ---------------
<S> <C> <C> <C>
Cash flows from operating activities
Net loss $ (813,431) $ (560,109) $(19,378,921)
----------- ---------- ------------
Adjustments to reconcile net loss
to net cash used in operating
activities
Depreciation and amortization 115,609 11,411 1,041,759
Reserve for uncollectable note 318,000
Unrealized loss on investments 42,650
Amortization of deferred compensation 42,453 42,453 891,514
Amortization of deferred revenue (101,840)
Minority interest in net losses of
subsidiaries (1,110,221)
Common stock issued for services
Officers/employees 1,291,133
Consultants 1,326,746
Warrants issued to officers/employees,
lenders and consultants 35,000 451,000
Acquired research and development costs 547,657
Reduction in carrying value of patents 159,775
Common stock of a subsidiary
issued for no additional consideration 304,400
Net gain on sale/disposition
of subsidiary stock (119,701)
Officers' loans forgiven as compensation 133,500
Net loss on sale of equipment 4,300
Changes in assets and liabilities, net
of assets acquired or disposed
Increase in accounts receivable (717,210)
Increase in inventory (255,481) (523,249)
Decrease (increase) in other
current assets 54,959 6,764 (373,395)
Increase in other assets (25,348)
Increase (decrease) in accounts
payable and
accrued expenses (18,109) 17,507 967,969
Increase in amount
due to minority
shareholder of subsidiary 191,392
Increase in deferred revenue 350,000
---------- ---------- ----------
(60,569) 113,135 5,050,831
---------- ---------- ----------
Net cash used in operating activities (874,000) (446,974) (14,328,090)
---------- ---------- ----------
<FN>
The accompanying notes are an integral part of these condensed statements.
</FN>
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (continued)
(unaudited)
<TABLE>
<CAPTION>
Cumulative
July 22, 1987
Three months ended August 31, inception) to
1995 1994 August 31,1995
---- ---- ----------------
<S> <C> <C> <C>
Cash flows from investing activities
Purchase of investments (10,017) (10,842) (985,842)
Proceeds from sale of investments 297,653
Proceeds from the sale of subsidiary stock 900,000
Acquisition/disposition of subsidiaries,
net of cash (1,003,483)
Purchase of property and equipment (4,655) (524,900)
Net proceeds from the sale of equipment 8,500
Loans to officers (174,500)
Repayment of officer loans 41,000
Purchase of intangibles (725,000)
Purchase of patent (159,775)
----------- ----------- -----------
Net cash used
in investing activities (14,672) (10,842) (2,326,347)
----------- ----------- ----------
Cash flows from financing activities
Proceeds from sale of common stock 14,330,360
Proceeds from the sale of preferred stock 387,625
Proceeds from exercise of stock options 54,135
Proceeds from exercise of warrants 90,000 90,000
Contribution from minority shareholder 525,000
Expenses of stock offerings (496,908)
Proceeds from notes 3,708,000 5,595,500
Repayments of loans (1,595,000)
Increase in stock subscriptions payable 85,000
Increase in minority interest (1,079,662)
----------- ----------- ----------
Net cash provided by financing
activities 3,798,000 - 20,055,374
----------- ----------- ----------
NET (DECREASE) INCREASE IN
CASH AND CASH EQUIVALENTS 2,909,328 (457,816) 3,400,937
Cash and cash equivalents - beginning of
year 491,609 762,875
----------- ----------- ----------
Cash and cash equivalents
end of year $3,400,937 $305,059 $3,400,937
----------- ----------- ----------
<FN>
The accompanying notes are an integral part of these condensed statements.
</FN>
</TABLE>
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
August 31, 1995
(unaudited)
NOTE A - BASIS OF PRESENTATION
The consolidated condensed balance sheet as of August 31, 1995 and the
related consolidated condensed statements of operations and cash flows for the
three-month periods ended August 31, 1995 and 1994 and changes in stockholders'
equity and cash flows for the three-month period ended August 31, 1995 have been
prepared by Vasomedical, Inc. and Subsidiaries (the "Company") without audit. In
the opinion of management, all adjustments (which include only normal, recurring
accrual adjustments) necessary to present fairly the financial position as of
August 31, 1995 and for all periods presented have been made.
Certain information and footnote disclosures, normally included in
financial statements prepared in accordance with generally accepted accounting
principles, have been condensed or omitted. These financial statements should be
read in conjunction with the financial statements and notes thereto included in
the Annual Report on Form 10-KSB for the year ended May 31, 1995. Results of
operations for the period ended August 31, 1995 are not necessarily indicative
of the operating results expected for the full year.
NOTE B - LONG-TERM DEBT
On July 7, 1995, the Company sold $4,000,000 principal amount of 7%
five-year Convertible Debentures (the Notes ), convertible into shares of the
Company's common stock at $1.00 per share commencing December 1, 1995. The
conversion price was equivalent to the quoted market price of the Company's
common stock when the transaction was negotiated.
Pursuant to the terms of the Note agreement: (i) the Noteholders may
request, at their option during the period June 1 through June 15, 1998,
redemption of the Notes at 104% of principal payable July 7, 1998, (ii) the
Company reserves the right to repay the Notes after January 7, 1996, at 110% of
principal, provided that the average daily closing price of the shares of the
Company is at least 200% of the conversion price for thirty (30) consecutive
trading days prior to conversion, (iii) the Company reserves the right to
convert all the Notes after January 7, 1996, provided that the average daily
closing price of the shares of the Company is at least 200% of the conversion
price for thirty (30) consecutive trading days prior to conversion, (iv) the
Note is collateralized by substantially all the existing assets of the Company,
and (v) interest is payable semi-annually commencing July 7, 1996. Also, in
connection with the sale of the Notes, the Company issued 600,000 shares of its
common stock to the broker/finder for services rendered.
NOTE C - STOCKHOLDERS' EQUITY
In the first quarter of fiscal 1996, the Company issued 600,000 shares of
its common stock to a broker/finder in connection with its July 1995 Convertible
Debenture financing. These shares were valued at $600,000 and are included as
deferred loan costs amortizable over a three-year period. Such value was
equivalent to the quoted market price of the Company's common stock.
In July 1995, the Company issued 89,096 shares of its common stock in lieu
of $89,096 of interest previously accrued under a 1992 note at the option of the
lender.
In August 1995, warrants to purchase 360,000 shares of common stock were
exercised, aggregating $90,000.
<PAGE>
Vasomedical, Inc. and Subsidiaries
(a development stage enterprise)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (continued)
August 31, 1995
(unaudited)
NOTE D - COMMITMENTS AND CONTINGENCIES
Employment Agreements
In September 1995, the Board of Directors approved a three-year extension
of the employment agreements with the Company's President and its Vice
President, Marketing and Clinical Affairs.
Approximate aggregate minimum annual compensation obligations under active
employment agreements at August 31, 1995, after giving effect to the above
extensions, are summarized as follows:
<TABLE>
<CAPTION>
Year ended August 31, Amount
--------------------- ------
<S> <C> <C>
1996 $ 651,000
1997 580,000
1998 368,000
1999 58,000
----------
$1,657,000
==========
</TABLE>
SEC Investigation
The Company has been served with a subpoena duces tecum by the
broker-dealer branch of the Northeast Regional Office of the Securities and
Exchange Commission ("SEC") requesting certain documents from the Company
pursuant to a formal order of private investigation in connection with possible
registration and reporting violations. The Company is cooperating fully with
such investigation. As stated in the subpoena, the "investigation is
confidential and should not be construed as an indication by the Commission or
its staff that any violations of law have occurred, nor should it be interpreted
as an adverse reflection on any person, entity or security." This investigation
is in its early stages and the Company is unable to determine the likelihood of
any unfavorable outcome or the existence or amount of any potential loss.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Results of Operations
Three Months Ended August 31, 1995 and 1994
The Company generated no revenues during the first quarter of fiscal 1996
or fiscal 1995. The Company incurred net losses of $813,000 and $560,000 for the
years three months ended August 31, 1995 and 1994, respectively.
The Company has successfully negotiated the lease or sale of some EECP
(Enhanced External Counterpulsation) Units. Although there can be no assurances
that EECP will be successfully commercialized, the Company has begun to generate
limited revenues revenues in the second quarter fiscal 1996.
VMI generated no revenues for the fiscal quarters ended August 31, 1995 and
1994. Products developed utilizing the VMI compound would require FDA approval
before they can be marketed in the U.S. On September 1, 1994, VMI entered into
an agreement with AECOM pursuant to which VMI is to receive 20% of all monetary
payments, as defined, if any, received by AECOM in exchange for VMI's assignment
of its patent rights and know-how.
Potential investors should be aware of the difficulties and delays normally
encountered by a company in the development stage, especially in view of the
regulated environment in which the Company operates and the paradigm shift in
the treatment of ischemic heart disease that EECP represents.
Selling, general and administrative (SGA) expenses for the three months
ended August 31, 1995 and 1994 were approximately $598,000 and $449,000,
respectively. The $149,000 increase in SGA expenses primarily resulted from a
$94,000 increase in payroll related to the addition of management and operating
personnel, particularly those formerly employed by Vasogenics and an increase of
$78,000 in marketing and related costs associated with the commercial
introduction of EECP . Such increases have been offset by a reduction in
consulting fees.
The increase in depreciation and amortization expense of $104,000 for the
quarter ended August 31, 1995 was directly related to the amortization of
goodwill relating to the Vasogenics acquisition in January 1995 and the
amortization of deferred loan costs in connection with the July 1995 debt
financing.
Research and development (R&D) expenses decreased $27,000 for the quarter
ended August 31, 1995. The decrease is a result of the timing of commitments and
expenses relating to the Company's multi-center clinical study for EECP . Such
commitments and expenses are expected to continued due in subsequent fiscal 1996
quarters.
Liquidity and Capital Resources
Working capital at August 31, 1995 increased $3,227,000 to $3,974,000 as
compared to $747,000 at May 31, 1995 due to the $4,000,000 7% Convertible
Debenture financing secured in July 1995, offset by continuing operating losses.
During the three months ended August 31, 1995 and 1994 and from inception to
August 31, 1995, the Company has used cash in its operating activities of
$874,000, $447,000 and $14,328,000, respectively, principally due to operating
losses in each respective period. Historically, the Company's principal source
of funds from financing activities has been from the sale of equity or debt
securities in public and private markets. Such proceeds have enabled the Company
to continue its operations despite its use of cash for operating activities.
From inception to August 31, 1995, the Company has raised $14,275,000 and
$5,500,000 from the sale of equity and debt securities, respectively. As
indicated in the accompanying consolidated condensed statements of cash flows,
cash flows used in investing activities were $15,000 and $11,000 for the
quarters ended August 31, 1995 and 1994, respectively, and $2,326,000 for the
period since inception to August 31, 1995. The Company's investing activities to
date have consisted primarily of purchases of: (a) subsidiaries, (b)
intangibles, (c) property and equipment, offset by the proceeds from the sale of
subsidiary stock and (d) net investments in mutual funds.
On July 7, 1995, the Company sold $4,000,000 principal amount of 7%
five-year Convertible Debentures (the Notes ), convertible into shares of the
Company's common stock at $1.00 per share commencing December 1, 1995. The
Company intends to use the net cash proceeds of $3,700,000 to support the
expansion of the sales force for the EECP treatment procedure and new clinical
studies designed to confirm additional therapeutic claims, as well as for
inventory, capital expenditures and general working capital.
Management believes that its present working capital position at August 31,
1995, and anticipated revenues from the initiation of its commercial program to
lease or sell EECP , will be sufficient to support its internal overhead
expenses and to implement its new development and business plans through August
31, 1996.
<PAGE>
VASOMEDICAL, INC.
AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS:
None
ITEM 2 - CHANGES IN SECURITIES:
None
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES:
None
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
None
ITEM 5 - OTHER INFORMATION:
None
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K:
Exhibits:
None
Reports on Form 8-K:
The Company filed a Report on Form 8-K dated July 7, 1995.
<PAGE>
In accordance with to the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
VASOMEDICAL, INC.
By: /s/ Anthony Viscusi
President and CEO (Principal Executive Officer)
/s/ Joseph A. Giacalone
Treasurer (Principal Accounting Officer)
Date: October 13, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from the
consolidated condensed financial statements for the three months ended August
31, 1995 and is qualified in its entirety by reference to such statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1995
<PERIOD-END> AUG-31-1995
<CASH> 3,400,937
<SECURITIES> 637,822
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 255,481
<CURRENT-ASSETS> 4,359,737
<PP&E> 69,965
<DEPRECIATION> 0
<TOTAL-ASSETS> 6,653,704
<CURRENT-LIABILITIES> 385,942
<BONDS> 4,000,000
<COMMON> 38,948
0
0
<OTHER-SE> 2,228,814
<TOTAL-LIABILITY-AND-EQUITY> 6,653,704
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 813,431
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 48,054
<INCOME-PRETAX> (813,431)
<INCOME-TAX> 0
<INCOME-CONTINUING> (813,431)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (813,431)
<EPS-PRIMARY> (.02)
<EPS-DILUTED> (.02)
</TABLE>
