<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934
For the quarterly period ended November 30, 1997
Commission File Number: 17598
CONSYGEN, INC.
(Exact name of registrant as specified in its charter)
Texas 76-0260145
----- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10201 South 51st Street, Suite 140, Phoenix, Arizona 85044
- ---------------------------------------------------- -----
(Address of principal executive offices) (Zip Code)
(602) 496-4545
--------------
(Registrant's telephone number, including area code)
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) Yes [X] No [ ] and (2) has been
subject to such filing requirements for the past 90 days. Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
15,054,078 shares of Common Stock, $.003 par value, as of January 12, 1998
--------------------------------------------------------------------------
<PAGE> 2
CONSYGEN, INC. AND SUBSIDIARIES
INDEX
PART I FINANCIAL INFORMATION:
Consolidated Condensed Balance Sheets,
November 30, 1997 and May 31, 1997
Consolidated Condensed Statements of Operations - Six
Months Ended November 30, 1997 and November 30, 1996
Consolidated Condensed Statements of Cash Flows - Six
Months Ended November 30, 1997 and November 30, 1996
Notes to Consolidated Condensed Financial Statements
Management's Discussion and Analysis of Financial
Condition and Results of Operations
PART II OTHER INFORMATION
SIGNATURES
<PAGE> 3
Part I - Financial Information
Item 1. FINANCIAL STATEMENTS
CONSYGEN, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
ASSETS
------
<TABLE>
<CAPTION>
NOVEMBER 30, 1997 MAY 31, 1997
----------------- ------------
<S> <C> <C>
Current Assets:
Cash and Cash Equivalents $ 4,683,434 $ 21,483
Debt Issuance Expense -- Net 33,332 33,336
Prepaid Expenses 60,300 18,225
------------ ------------
Total Current Assets 4,777,066 73,044
------------ ------------
Furniture and Equipment - Net 310,423 72,031
------------ ------------
Other Assets:
Debt Issuance Expense - Net of Current Portion 44,446 61,108
Other Assets 6,496 4,596
------------ ------------
Total Other Assets 50,942 65,704
------------ ------------
Total Assets $ 5,138,431 $ 210,779
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
Current Liabilities:
Notes Payable $ 83,317 $ 259,507
Loans Payable - 160,000
Loans Payable - Related Parties - 139,177
Accounts Payable 100,865 62,704
Accrued Liabilities 271,473 308,899
------------ ------------
Total Current Liabilities 455,655 930,287
Long-Term Debt 1,000,000 1,000,000
------------ ------------
Total Liabilities 1,455,655 1,930,287
------------ ------------
Commitments and Contingencies
Stockholders' Equity (Deficit):
Common Stock, $.003 par Value, 40,000,000
Shares Authorized, Issued and Outstanding
15,054,078 Shares at November 30, 1997 and
13,796,231 Shares at May 31, 1997 45,163 41,389
Additional Paid-in Capital 24,261,463 17,108,689
Accumulated Deficit (20,623,850) (18,869,586)
------------ ------------
Total Stockholders' Equity (Deficit) 3,682,776 (1,719,508)
------------ ------------
Total Liabilities and Stockholders' Equity (Deficit) $ 5,138,431 $ 210,779
============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 4
CONSYGEN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
FOR THE THREE FOR THE SIX
------------- -----------
MONTHS ENDED MONTHS ENDED
------------ ------------
NOVEMBER 30, NOVEMBER 30,
------------ ------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Conversion Services $ 121,000 $ - $ 121,000 $ -
Interest Income 33,673 - 39,588 -
----------- ----------- ----------- -----------
Total Revenues 154,673 - 160,588 -
----------- ----------- ----------- -----------
Costs and Expenses:
Cost of Conversion Services 36,914 - 36,914 -
Software Development 293,787 262,932 577,832 473,492
General and Administrative
Expenses 706,375 4,479,404 1,040,188 5,506,313
Interest Expense 94,290 42,064 204,954 105,044
Depreciation & Amortization 33,561 31,965 54,964 82,930
----------- ----------- ----------- -----------
Total Costs and Expenses 1,164,927 4,816,365 1,914,852 6,167,779
----------- ----------- ----------- -----------
Net Loss $(1,010,254) $(4,816,365) $(1,754,264) $(6,167,779)
=========== =========== =========== ===========
Weighted Average Common Shares
Outstanding 14,858,121 13,686,231 14,388,977 10,881,558
=========== =========== =========== ===========
Net Loss Per Common Share $ (.07) $ (.35) $ (.12) $ (.57)
=========== =========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 5
CONSYGEN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
For The Six Months Ended November 30
------------------------------------
1997 1996
---- ----
<S> <C> <C>
Cash Flows From Operating Activities: $(1,754,264) $(6,167,779)
Net Loss
Adjustments to Reconcile Net Loss to
Net Cash (Used) by Operating
Activities:
Depreciation 38,298 9,763
Stock Issued for Services 106,400 5,167,961
Amortization of Debt Issuance Expense 16,666 73,167
Loan Interest - Additional Paid-in Capital 12,090 32,860
Changes in Operating Assets and Liabilities:
Accounts Receivable - 13,265
Prepaid Expenses and Other Assets (43,975) 75
Accounts Payable 38,161 (98,210)
Accrued Liabilities (37,426) 16,697
----------- -----------
Net Cash (Used) by Operating Activities (1,624,050) (952,201)
----------- -----------
Cash Flows From Investing Activities:
Purchases of Furniture and Equipment (276,690) (30,227)
----------- -----------
Net Cash (Used) by Investing Activities (276,690) (30,227)
----------- -----------
Cash Flows From Financing Activities:
Proceeds of Debt Financing - 1,123,700
Proceeds from Sale of Common Stock 7,238,750 -
Commissions on Sale of Common Stock (326,267) -
Expenses of Offering (125,000) -
Proceeds of Loans and Notes Payable - 34,908
Payments of Loans and Notes Payable (247,890) (50,000)
Proceeds of Loans Payable -- Related Parties 23,190 -
Payments of Loans Payable -- Related Parties (92) (24,679)
Cash in Escrow - (98,600)
----------- -----------
Net Cash Provided by Financing Activities 6,562,691 985,329
----------- -----------
Net Increase in Cash and Cash Equivalents 4,661,951 2,901
Cash and Cash Equivalents -- Beginning of Period 21,483 -
----------- -----------
Cash and Cash Equivalents -- End of Period $ 4,683,434 $ 2,901
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 6
CONSYGEN, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
(continued)
<TABLE>
<CAPTION>
For The Six Months Ended November 30,
-------------------------------------
1997 1996
---- ----
<S> <C> <C>
Supplemental Cash Flow Information:
Cash Paid for Interest $ 104,371 $ 3,010
========= ==========
Cash Paid for Income Taxes $ - $ -
========= ==========
Supplemental Disclosure of Non-Cash Financing Activities:
Cancellation of Debt into Additional Paid-In Capital-
Related Parties $ - $ 350,000
========= ==========
Issuance of Common Stock as Debt Issuance Expense $ - $ 24,000
========= ==========
Issuance of Common Stock as Payment of Debt-
Related Parties $ 162,275 $ 350,000
========= ==========
Effect of Reverse Acquisition - Accounts Payable Acquired $ - $ 6,800
========= ==========
Issuance of Common Stock as Payment of Debt $ 88,300 $1,182,543
========= ==========
Issuance of Common Stock as Commissions on Sale of
Common Stock $ 206,269 $ -
========= ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE> 7
CONSYGEN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOVEMBER 30, 1997
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
---------------------
The consolidated financial statements include the accounts of
ConSyGen, Inc., a Texas corporation ("ConSyGen-Texas") and its wholly-owned
subsidiary, ConSyGen, Inc., an Arizona corporation ("ConSyGen-Arizona").
Significant intercompany accounts and transactions have been eliminated.
ConSyGen-Texas and its wholly-owned subsidiary
ConSyGen-Arizona are hereafter collectively referred to as the "Company".
In the opinion of the Company, the accompanying unaudited
consolidated financial statements reflect all adjustments (which include only
normal recurring adjustments) necessary to present fairly the results of
operations and cash flows for the periods presented.
Results of operations for interim periods are not necessarily
indicative of the results of operations for a full year due to external factors
that are beyond the control of the Company.
NOTE 2 - STOCKHOLDERS' EQUITY (DEFICIT)
------------------------------
COMMON STOCK PRIVATE PLACEMENTS
-------------------------------
In June 1997 the Company sold 120,000 shares of its common
stock in a private placement for gross proceeds of $1,080,000. In connection
with the sale, the Company paid finder's fees of $75,600 and issued 3,600 shares
of common stock valued at $21,600. These shares were sold in a private placement
exempt from registration under the Securities Act of 1933, as amended ("the
Act"), pursuant to Regulation D promulgated thereunder.
During September 1997, the Company sold 152,000 shares of
common stock for gross proceeds of $882,500. In connection with the sale, the
Company paid finder's fees of $66,000. These shares were sold in a private
placement exempt from registration under the Act, pursuant to Regulation D
promulgated thereunder.
During September 1997, the Company sold 900,000 shares of
common stock in a private placement for gross proceeds $5,276,250. In connection
with this offering, the Company paid the following finder's fee: $184,667 in
cash and 31,500 shares of common stock valued at $184,669. These shares were
sold in a private placement exempt from registration under the Act, pursuant to
Regulation D promulgated thereunder.
COMMON STOCK ISSUED FOR PAYMENT OF DEBT
---------------------------------------
In October 1997, the Company issued 30,747 shares of common
stock, including 19,912 shares to related parties, in connection with the
payment of indebtedness in the aggregate amount of $250,575.
<PAGE> 8
CONSYGEN, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOVEMBER 30, 1997
(Unaudited)
(Continued)
NOTE 2 - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)
------------------------------------------
WARRANT ISSUANCES TO CONSULTANTS
--------------------------------
In July, 1997, in connection with the May 1997 agreement with
the Company's consultant, which superseded all prior agreements with the
consultant, the Company agreed to issue the consultant warrants to purchase
300,000 shares of common stock at a price of $5.00 per share. The shares of
common stock issuable upon exercise of these warrants will be restricted
securities under the Securities Act of 1933. The warrants are immediately
exercisable, expire two years from the date of grant, and are callable upon 60
days notice. As of September 1, 1997, the Company and the consultant, by mutual
agreement, terminated all prior agreements between them, including the May 1997
agreement.
In November 1997, the Company issued to a consultant for
services rendered warrants to purchase an aggregate of 100,000 shares of common
stock at an exercise price of $5.00 per share. The warrants become fully
exercisable in November 1998.
Increase in Common Shares Authorized
------------------------------------
In July 1997, the Company amended its Articles of
Incorporation to increase its authorized common shares from 16,666,666 to
40,000,000 shares.
Stock Options
-------------
During September 1997, the Company granted to certain officers
and directors options to purchase an aggregate of 610,000 shares of common stock
pursuant to the Company's 1997 Amended and Restated Non Qualified Stock Option
Plan. The options had a term of 10 years, exercise prices ranging from $5.50 to
$6.00 per share, and were exercisable as follows: 25% were immediately
exercisable and the remaining 75% became exercisable in 24 equal monthly
installments commencing one month from the date of grant. In November 1997,
certain officers and directors surrendered options to purchase an aggregate of
1,015,000 shares of common stock in exchange for replacement options to purchase
a total of 1,015,000 shares with an exercise price of $4.00 per share. Of these
1,015,000 options, options to purchase 600,230 shares are immediately
exercisable and the remaining 414,770 become exercisable in twenty-two equal
monthly installments, commencing one month from the date of grant. The options
were granted under the 1997 Amended and Restated Non-Qualified Stock Option
Plan.
NOTE 3 - SUBSEQUENT EVENTS
-----------------
CONVERSION OF CONVERTIBLE DEBT
------------------------------
In January 1998, of the $1,000,000 of Convertible Notes
outstanding at November 30, 1997, Convertible Notes in the aggregate principal
amount of $800,000 were converted, in accordance with the terms of the Notes,
into an aggregate of 268,922 shares of common stock.
<PAGE> 9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
The following discussion and analysis should be read in conjunction with
the Company's Consolidated Financial Statements and the Notes thereto appearing
elsewhere in this Report.
OVERVIEW
ConSyGen, Inc., a Texas corporation (the "Company"), was incorporated on
September 28, 1988 as C-Square Ventures, Inc. The Company was formed for the
purpose of obtaining capital in order to take advantage of domestic and foreign
business opportunities which may have profit potential. On March 16, 1989, the
Company (then C Square Ventures, Inc.) completed an initial public offering.
ACQUISITION OF CONSYGEN, INC.
The Company entered into an agreement, dated as of August 28, 1996, to
acquire 100% of the issued and outstanding shares of ConSyGen, Inc., a privately
held Arizona corporation formed on October 11, 1979 ("ConSyGen-Arizona") (f/k/a
International Data Systems, Inc.). Immediately prior to the acquisition
transaction, the Company effected a 1-for-40 reverse split of its Common Stock.
The Company closed the acquisition of ConSyGen-Arizona on September 5, 1996. As
a result of the acquisition, ConSyGen-Arizona became a wholly-owned subsidiary
of the Company. The transaction has been treated as a reverse acquisition
(purchase), with ConSyGen-Arizona being the acquirer and the Company being the
acquired company.
The Company and its wholly-owned subsidiary, ConSyGen-Arizona, are
herein collectively referred to as the "Company."
RECENT FINANCINGS
In June 1997, the Company raised approximately $1,080,000, before
deducting a finder's fee of approximately $80,000, through the private placement
of 120,000 shares of Common Stock.
In late August and early September, 1997, the Company raised $882,500,
before deducting a finder's fee of $66,000, through the private placement of
152,000 shares of Common Stock.
In September 1997, the Company sold 900,000 shares of Common Stock in a
private placement for gross proceeds of $5,276,250. In connection with this
offering, the Company paid a finder's fee consisting of approximately $185,000
in cash and 31,500 shares of Common Stock. The net proceeds of this offering
were approximately $5.1 million.
MATERIAL CHANGES IN RESULTS OF OPERATIONS
Although the Company is actively marketing its ConSyGen 2000 and
ConSyGen Conversion toolsets, the Company is not currently generating
significant revenue from its ConSyGen 2000 or its ConSyGen Conversion toolset,
or otherwise. Although the Company has completed several pilot (non-revenue
generating) Year 2000 conversion projects, and is currently working on two
revenue
<PAGE> 10
generating conversion projects, the Company has not yet completed a revenue
generating Year 2000 conversion project. The Company did complete several
revenue generating migration projects from 1993 to 1995, but the Company has not
since completed such a project. Instead, the Company's efforts have been focused
on the further development of its ConSyGen Conversion toolset, including
extending the toolset to cover new hardware environments. Such further
development and extension of the toolset was necessary, as the toolset was
limited in application to Honeywell/BULL systems and the Company desired to
significantly increase the speed of conversions. The Company recently entered
into three revenue generating contracts, pursuant to which the Company is
providing conversion services, including both migration and Year 2000 correction
services.
Quarterly and Six Month Periods Ended November 30, 1997 and 1996
Net Losses. For the quarter ended November 30, 1997, the Company
incurred net losses of $1,010,000, compared with net losses of $4,816,000 for
the comparable prior quarter, a decrease of $3,806,000. For the six months ended
November 30, 1997, the Company incurred net losses of $1,754,000, compared with
net losses of $6,168,000 for the comparable prior period, a decrease of
$4,414,000. An explanation of these losses is set forth below.
Revenues. For the quarter ended November 30, 1997, the Company had
operating revenue of $121,000, compared with no operating revenue for the
comparable prior period. For the six months ended November 30, 1997, the Company
had $121,000 in operating revenue, compared with no operating revenue in the
comparable prior period. This revenue was related to a conversion services
contract which the Company is currently performing. The Company has abandoned
its software licensing and maintenance business and is now focused on the
marketing of its conversion services, including its Year 2000 conversion
services.
Software Development Expenses. For the quarter ended November 30, 1997,
software development expenses were $294,000, compared with $263,000 for the
quarter ended November 30, 1996, an increase of approximately $31,000. For the
six months ended November 30, 1997, software development expenses were $578,000,
compared with $473,000 for the comparable prior period, an increase of $105,000.
These increases in software development expenses are primarily attributable to
the Company's hiring of additional personnel dedicated to the development of
software for use in providing conversion services, including Year 2000
conversion services.
General and Administrative Expenses. For the quarter ended November 30,
1997, general and administrative expenses were approximately $706,000, compared
with approximately $4,479,000 for the quarter ended November 30, 1996, a
decrease of $3,773,000. This decrease in general and administrative expenses was
primarily attributable to a decrease of $4,173,000 in non-cash compensation
expenses (related to stock issued for services), offset by the following: a
$123,000 increase in expenses associated with the Company's status as a public
company; a $244,000 increase in payroll and related expenses, and a $33,000
increase in other general expenses. For the six months ended November 30, 1997,
general and administrative expenses were $1,040,000, compared with $5,506,000
for the comparable prior period, a decrease of $4,466,000. This decrease in
general and administrative expenses was primarily attributable to a decrease of
$5,062,000 in non-cash compensation expenses (related to stock issued for
services), offset by the following: a $257,000 increase in expenses associated
with the Company's status as a public company and a $339,000 increase in payroll
and related expenses.
<PAGE> 11
Depreciation Expense. For the quarter ended November 30, 1997,
depreciation expense was approximately $25,000, compared with $5,000 for the
comparable prior period, an increase of $20,000. For the six months ended
November 30, 1997, depreciation expense was $38,000, compared with $10,000, for
the comparable prior period. These increases are attributable primarily to
purchases of furniture and equipment.
Amortization Expense. For the quarter ended November 30, 1997,
amortization of debt issuance expense was $9,000, compared with $11,000 for the
comparable prior period, a decrease of $2,000. For the six months ended November
30, 1997, amortization of debt issuance expense was $17,000, compared with
$73,000 for the comparable prior period, a decrease of $56,000. These decreases
are attributable to certain debt issuance expenses having been fully amortized.
MATERIAL CHANGES IN FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
At November 30, 1997 the Company continued to incur, and has
historically incurred, substantial and recurring losses. For the six months
ended November 30, 1997, the Company did not generate significant operating
revenue. The Company continues, however, to incur substantial costs and expenses
in connection with its business operations. As noted above, the Company recently
entered into three revenue generating contracts, pursuant to which the Company
is providing conversion services, including both migration and Year 2000
correction services.
The Company's cash and cash equivalent balances were approximately
$4,683,000 at November 30, 1997, compared with $21,000 at May 31, 1997. The
Company had working capital of approximately $4,321,000 at November 30, 1997,
compared with a working capital deficit of approximately $857,000 at May 31,
1997, an increase in working capital of approximately $5,178,000. This increase
in working capital is primarily attributable to proceeds from the sale of Common
Stock.
The Company believes that it now has sufficient capital to fund its
continuing operations for approximately twelve months.
As of January 1998, the Company had no material commitments with respect
to capital expenditures.
IMPACT OF INFLATION
Increases in the inflation rate are not expected to affect the Company's
operating expenses. Although the Company has no current plans to borrow
additional funds, if it were to do so at variable interest rates, any increase
in interest rates would increase the Company's cost of borrowed funds.
SEASONALITY
The Company's operations are not affected by seasonal fluctuations,
although the Company's cash flows may at times be affected by fluctuations in
the timing of cash receipts from large contracts.
<PAGE> 12
PART II - OTHER INFORMATION
Item 2. CHANGES IN SECURITIES
On September 29, 1997, the Company sold 900,000 shares of Common Stock
in a private placement for gross proceeds of $5,276,250. In connection with this
offering, the Company paid the following finder's fee: approximately $185,000 in
cash and 31,500 shares of Common Stock. The net proceeds of this offering were
approximately $5.1 million. The securities were offered and sold exclusively to
"accredited investors," within the meaning of Rule 501 under the Securities Act
of 1933, as amended (the "Act").
In October 1997, the Company issued 30,747 shares of Common Stock in
payment of indebtedness in the aggregate amount of $250,575.
The sale of all of the foregoing securities was exempt from registration
under Section 5 of the Act, pursuant to Rule 506 of Regulation D promulgated
thereunder. The facts relied upon by the issuer were as follows: all the
investors were "accredited investors," within the meaning of Rule 501 under the
Act; the securities were not offered or sold by means of general solicitation or
advertising; investors were provided information about the Company and given the
opportunity to ask questions of and receive answers from management of the
Company; and the issuer took reasonable steps to assure that the purchasers were
not "underwriters" within the meaning of Section 2(11) of the Act.
On November 10, 1997, the Company issued to a consultant of the Company
warrants to purchase an aggregate of 100,000 shares of Common Stock at an
exercise price of $5.00 per share. The warrants were issued to the consultant in
consideration of services rendered to the Company. The sale of these warrants
was exempt from registration under Section 5 of the Act, pursuant to Section
4(2) of the Act and the rules and regulations thereunder. The facts relied upon
by the issuer were as follows: the consultant is an "accredited investor,"
within the meaning of Rule 501 under the Act; the warrants were not offered or
sold my means of any general solicitation or advertising; the consultant is
sophisticated about business and financial matters and knowledgeable about the
Company and its prospects; and the issuer took reasonable steps to assure that
the consultant was not an underwriter within the meaning of Section 2(11) under
the Act.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
A Special Meeting in Lieu of Annual Meeting of the Stockholders of the
Company was held on November 20, 1997. At such Meeting, the Stockholders of the
Company re-elected Robert L. Stewart, Leslie F. Stewart and Ronald I. Bishop as
the directors of the Company.
The number of votes cast with respect to the election of directors was
as follows:
DIRECTOR FOR AGAINST ABSTAIN
- -------- --- ------- -------
Robert L. Stewart 10,700,342 15,902 117,466
Leslie F. Stewart 10,700,323 15,921 117,466
Ronald I. Bishop 10,715,742 502 117,466
<PAGE> 13
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------------------
2 Plan of Acquisition between the Company and the stockholders
of ConSyGen, Inc., an Arizona corporation, dated August 28,
1996, filed as Exhibit 2 to the Company's Current Report on
Form 8-K, dated September 5, 1996 and incorporated herein by
reference.
3.1 Articles of Incorporation of the Company, as amended.(1)
3.2 By-Laws of the Company, filed as Exhibit 3.B to the Company's
Registration Statement on Form S-18, File No. 33-22900-FW, and
incorporated herein by reference.
4.1 Specimen common stock certificate, filed as Exhibit 4.B to the
Company's Registration Statement on Form S-18, File No.
33-22900-FW, and incorporated herein by reference.
4.2 Form of Common Stock Purchase Warrant used in connection with
the issuance of warrants to purchase an aggregate of 1,000,000
shares of the Company's Common Stock, $.003 par value.(2)
4.3 Subscription Agreement between the Company and Little Wing,
L.P. for convertible debt of the Company (including Summary of
Terms).(2)
4.4 Subscription Agreement between the Company and Tonga Partners,
L.P. for convertible debt of the Company (including Summary of
Terms).(2)
4.5 Form of Subscription Agreement used in connection with Rule
506 offering in the aggregate amount of $1,080,000.(1)
4.6 Form of Subscription Agreement used in connection with Rule
506 offering in the aggregate amount of $882,500.(1)
4.7 Form of Common Stock Purchase Warrant issued to a consultant,
Howard R. Baer, in August 1997.(1)
4.8 Common Stock Purchase Warrant issued to Howard R. Baer's
designee, Kevin C. Baer, in August 1997.(1)
4.9 Subscription Agreement used in Rule 506 offering in the
aggregate amount of $5,276,250.(3)
4.10 Form of Subscription Agreement used in connection with
issuance of shares in payment of indebtedness in the aggregate
amount of approximately $250,000.(3)
- ----------------------
(1) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1997, and
incorporated herein by reference.
(2) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1996, and
incorporated herein by reference.
(3) Filed as an Exhibit, with the same Exhibit number, to the Company's
Registration Statement on Form S-1, File No. 333-40649, and incorporated herein
by reference.
<PAGE> 14
Item 6. EXHIBITS AND REPORTS IN FORM 8-K - CONTINUATION
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------------------
4.11 Common Stock Purchase Warrant issued to a consultant's
designee, Irvington International Limited, in November,
1997.(3)
10.1 Agreement between the Company and Carriage House Capital, Inc.
dated May 19, 1997, superseding letter agreements (also filed
as Exhibit 10.1) between Carriage House Capital, Inc. and the
Company's wholly-owned subsidiary, dated June 14, 1996 and
October 26, 1995.(2)
10.2 Consulting Agreement between Carriage House Capital, Inc. and
the Company dated July 10, 1996.(2)
10.3 Consulting Agreement between Mikesco, Inc. and the Company
dated July 10, 1996.(2)
10.4 Consulting Agreement between Concorda Corp. and the Company
dated July 10, 1996.(2)
10.5 Consulting Agreement between Scarlet Investment Group, Inc.
and the Company dated July 10, 1996. (2)
10.6 Consulting Agreement between The Canter Corporation and the
Company dated August 20, 1996.(2)
10.7 Company's 1996 Non-Qualified Stock Option Plan.(2)
10.8 Company's Amended and Restated 1997 Non-Qualified Stock Option
Plan.(3)
10.9 Consulting Agreement between the Company and Innovative
Research Associates, Inc.(2)
10.10 Form of Indemnification Contract between the Company and each
executive officer and director of the Company.(3)
10.11 Agreement between the Company and Carriage House Capital,
Inc., effective as of September 1, 1997, terminating all
existing agreements between the Company and Carriage House
Capital, Inc. and its affiliates.(3)
27 Financial Data Schedule
(b) Reports on Form 8-K
Not applicable.
- -------------------------------
(2) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1996, and
incorporated herein by reference.
(3) Filed as an Exhibit, with the same Exhibit number, to the Company's
Registration Statement on Form S-1, File No. 333-40649, and incorporated herein
by reference.
<PAGE> 15
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.
CONSYGEN, INC.
Date: January 14, 1998 By: /s/ Ronald I. Bishop
--------------------------------- --------------------
Ronald I. Bishop, President
and Chief Executive Officer
Date: January 14, 1998 By: /s/ Kenneth Harvey
--------------------------------- ------------------
Kenneth Harvey, Controller
(Chief Accounting Officer)
<PAGE> 16
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------------------
2 Plan of Acquisition between the Company and the stockholders
of ConSyGen, Inc., an Arizona corporation, dated August 28,
1996, filed as Exhibit 2 to the Company's Current Report on
Form 8-K, dated September 5, 1996 and incorporated herein by
reference.
3.1 Articles of Incorporation of the Company, as amended.(1)
3.2 By-Laws of the Company, filed as Exhibit 3.B to the Company's
Registration Statement on Form S-18, File No. 33-22900-FW, and
incorporated herein by reference.
4.1 Specimen common stock certificate, filed as Exhibit 4.B to the
Company's Registration Statement on Form S-18, File No.
33-22900-FW, and incorporated herein by reference.
4.2 Form of Common Stock Purchase Warrant used in connection with
the issuance of warrants to purchase an aggregate of 1,000,000
shares of the Company's Common Stock, $.003 par value.(2)
4.3 Subscription Agreement between the Company and Little Wing,
L.P. for convertible debt of the Company (including Summary of
Terms).(2)
4.4 Subscription Agreement between the Company and Tonga Partners,
L.P. for convertible debt of the Company (including Summary of
Terms).(2)
4.5 Form of Subscription Agreement used in connection with Rule
506 offering in the aggregate amount of $1,080,000.(1)
4.6 Form of Subscription Agreement used in connection with Rule
506 offering in the aggregate amount of $882,500.(1)
4.7 Form of Common Stock Purchase Warrant issued to a consultant,
Howard R. Baer, in August 1997.(1)
4.8 Common Stock Purchase Warrant issued to Howard R. Baer's
designee, Kevin C. Baer, in August 1997.(1)
4.9 Subscription Agreement used in Rule 506 offering in the
aggregate amount of $5,276,250.(3)
- -----------------------------
(1) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1997, and
incorporated herein by reference.
(2) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1996, and
incorporated herein by reference.
(3) Filed as an Exhibit, with the same Exhibit number, to the Company's
Registration Statement on Form S-1, File No. 333-40649, and incorporated herein
by reference.
<PAGE> 17
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------------------
4.10 Form of Subscription Agreement used in connection with
issuance of shares in payment of indebtedness in the aggregate
amount of approximately $250,000.(3)
4.11 Common Stock Purchase Warrant issued to a consultant's
designee, Irvington International Limited, in November,
1997.(3)
10.1 Agreement between the Company and Carriage House Capital, Inc.
dated May 19, 1997, superseding letter agreements (also filed
as Exhibit 10.1) between Carriage House Capital, Inc. and the
Company's wholly-owned subsidiary, dated June 14, 1996 and
October 26, 1995.(2)
10.2 Consulting Agreement between Carriage House Capital, Inc. and
the Company dated July 10, 1996.(2)
10.3 Consulting Agreement between Mikesco, Inc. and the Company
dated July 10, 1996.(2)
10.4 Consulting Agreement between Concorda Corp. and the Company
dated July 10, 1996.(2)
10.5 Consulting Agreement between Scarlet Investment Group, Inc.
and the Company dated July 10, 1996.(2)
10.6 Consulting Agreement between The Canter Corporation and the
Company dated August 20, 1996.(2)
10.7 Company's 1996 Non-Qualified Stock Option Plan.(2)
10.8 Company's Amended and Restated 1997 Non-Qualified Stock Option
Plan.(3)
10.9 Consulting Agreement between the Company and Innovative
Research Associates, Inc.(2)
10.10 Form of Indemnification Contract between the Company and each
executive officer and director of the Company.(3)
10.11 Agreement between the Company and Carriage House Capital,
Inc., effective as of September 1, 1997, terminating all
existing agreements between the Company and Carriage House
Capital, Inc. and its affiliates.(3)
27 Financial Data Schedule
- ------------------------
(2) Filed as an Exhibit, with the same Exhibit number, to the Company's
Quarterly Report on Form 10-Q for the quarter ended August 31, 1996, and
incorporated herein by reference.
(3) Filed as an Exhibit, with the same Exhibit number, to the Company's
Registration Statement on Form S-1, File No. 333-40649, and incorporated herein
by reference.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> NOV-30-1997
<CASH> 4,683,434
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 4,777,066
<PP&E> 460,784
<DEPRECIATION> 150,361
<TOTAL-ASSETS> 5,138,431
<CURRENT-LIABILITIES> 455,655
<BONDS> 0
0
0
<COMMON> 45,163
<OTHER-SE> 3,637,613<F1>
<TOTAL-LIABILITY-AND-EQUITY> 5,138,431
<SALES> 121,000
<TOTAL-REVENUES> 160,588
<CGS> 36,914
<TOTAL-COSTS> 36,914
<OTHER-EXPENSES> 1,672,984
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 204,954
<INCOME-PRETAX> (1,754,264)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,754,264)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,754,264)
<EPS-PRIMARY> (.12)
<EPS-DILUTED> 0
<FN>
<F1>Other SE consists of:
Additional Paid-in-Capital 24,261,463
Accumulated Deficit (20,623,850)
-----------
3,637,613
===========
</FN>
</TABLE>
