<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM 10-Q
(Mark One)
X Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
- ---
Act of 1934
For the quarterly period ended September 30,1996 or
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange
- ---
Act of 1934
For the transition period from to
------ ------
Commission file number 0-18053
LASERSCOPE
(Exact name of Registrant as specified in its charter)
CALIFORNIA 77-0049527
(State of Incorporation) (I.R.S. Employer Identification No.)
3052 ORCHARD DRIVE, SAN JOSE, CALIFORNIA 95134-2011
(Address of principal executive offices)
Registrant's telephone number: (408) 943-0636
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
The number of shares of Registrant's common stock issued and outstanding as of
October 31, 1996 was 11,816,769.
<PAGE> 2
TABLE OF CONTENTS
PAGE
----
PART I. FINANCIAL INFORMATION.......................................... 3
Item 1. Condensed Consolidated Balance Sheets........................ 3
Condensed Consolidated Statements of Operations ............ 4
Condensed Consolidated Statements of Cash Flows.............. 5
Notes to Condensed Consolidated Financial Statements......... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations................ 9
Results of Operations........................................ 9
Liquidity and Capital Resources.............................. 11
PART II. OTHER INFORMATION............................................ 13
Item 1. Legal Proceedings............................................ 13
Item 2. Changes in Securities ....................................... 13
Item 3. Defaults upon Senior Securities.............................. 13
Item 4. Submission of Matters to a Vote of Security Holders.......... 13
Item 5. Other Items.................................................. 14
Item 6. Exhibits and Reports on Form 8-K............................ 14
SIGNATURES ............................................................. 15
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
LASERSCOPE
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
(thousands) 1996 1995
- ----------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents ......................... $ 3,414 $ 2,278
Accounts receivable, net .......................... 11,541 5,543
Inventories ....................................... 17,274 10,292
Other current assets .............................. 676 692
-------- --------
Total current assets ........................ 32,905 18,805
Property and equipment, net .......................... 2,653 2,663
Investment in NWL .................................... 1,681 1,681
Intangibles from acquisition of
Heraeus Surgical, Inc. ............................ 3,090 --
Other assets ......................................... 776 433
-------- --------
Total assets ................................ $ 41,105 $ 23,582
-------- --------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
Accounts payable .................................. $ 6,796 $ 1,455
Accrued compensation .............................. 2,958 1,156
Other current liabilities ......................... 5,325 3,630
-------- --------
Total current liabilities ...................... 15,079 6,241
Obligations under capital leases ..................... 5 15
Commitments and contingencies ........................
Shareholders' equity:
Common stock ................................... 48,477 37,248
Accumulated deficit ............................ (21,719) (19,296)
Translation adjustments ........................ (362) (251)
Notes receivable from shareholders ............. (375) (375)
-------- --------
Total shareholders' equity ..................... 26,021 17,326
-------- --------
Total liabilities and shareholders' equity ........... $ 41,105 $ 23,582
-------- --------
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE> 4
LASERSCOPE
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
(thousands except per share amounts) 1996 1995 1996 1995
- -----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenues ......................... $ 10,561 $ 7,048 $ 26,764 $ 23,142
Cost of sales ........................ 5,226 3,585 13,366 11,046
-------- -------- -------- --------
Gross margin ......................... 5,335 3,463 13,398 12,096
Operating expenses:
Research and development .......... 620 986 1,771 3,025
Purchased in-process
research and development ....... 2,376 -- 2,376 --
Selling, general and
administrative ................. 4,285 3,798 10,778 11,164
Other non-recurring charges ....... 872 -- 872 --
-------- -------- -------- --------
8,153 4,784 15,797 14,189
Operating income (loss) .............. (2,818) (1,321) (2,399) (2,093)
Interest and other income, net ....... 7 62 29 250
-------- -------- -------- --------
Income (loss) before income taxes .... (2,811) (1,259) $ (2,370) (1,843)
Provision for income taxes ........... -- -- 53 --
-------- -------- -------- --------
Net income (loss) .................... $ (2,811) $ (1,259) $ (2,423) $ (1,843)
-------- -------- -------- --------
Net income (loss) per share .......... $ (0.32) $ (0.18) $ (0.32) $ (0.26)
-------- -------- -------- --------
Shares used in per share
calculations ...................... 8,731 7,015 7,629 6,994
-------- -------- -------- --------
</TABLE>
See notes to condensed consolidated financial statements
4
<PAGE> 5
LASERSCOPE
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
(thousands) 1996 1995
- ------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss ....................................................... $(2,423) $(1,843)
Adjustments to reconcile net loss to cash
provided (used) by operating activities:
Depreciation and amortization ............................... 940 1,139
Purchased in-process research and development ............... 2,376 --
Increase (decrease) from changes in:
Accounts receivable ...................................... (877) 3,126
Inventories .............................................. 1,709 (3,219)
Other current assets ..................................... 216 (50)
Other assets ............................................. (100) 71
Accounts payable ......................................... 276 109
Accrued compensation ..................................... 338 82
Other current liabilities ................................ 126 (433)
------- -------
Cash provided (used) by operating activities ...................... 2,581 (1,018)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures ........................................... (223) (476)
Funding of agreement with NWL .................................. -- (1,681)
Maturities of held-to-maturity investments .................... -- 979
Cash paid for Heraeus Surgical acquisition,
net of cash received ........................................ (1,430) --
Other .......................................................... (111) (75)
------- -------
Cash used by investing activities ................................. (1,764) (1,253)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on obligations under capital leases ................... (10) (8)
Proceeds on sale of common stock ............................... 329 --
------- -------
Cash provided (used) by financing activities ...................... 319 (8)
------- -------
Increase (decrease) in cash and cash equivalents .................. 1,136 (2,279)
Cash and cash equivalents, beginning of period .................... 2,278 4,604
------- -------
Cash and cash equivalents, end of period .......................... $ 3,414 $ 2,325
------- -------
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest ................................................. $ 10 $ 23
Income taxes ............................................. $ 76 $ 41
</TABLE>
See notes to condensed consolidated financial statements
5
<PAGE> 6
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
1. The accompanying condensed consolidated financial statements include
Laserscope (the "Company") and its wholly and majority-owned subsidiaries.
All intercompany transactions and balances have been eliminated. While the
financial information in this report is unaudited, in the opinion of
management, all adjustments (which included only normal recurring
adjustments) necessary to present fairly the financial position and
results of operations as of and for the periods indicated have been
recorded. It is suggested that these consolidated financial statements be
read in conjunction with the consolidated financial statements and the
notes thereto for the year ended December 31, 1995 included in the
Company's annual report on Form 10-K for the year ended December 31, 1995.
The results of operations for the three and nine month periods ended
September 30, 1996 are not necessarily indicative of the results expected
for the full year.
2. Inventory was comprised of the following (in thousands):
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1996 1995
---------------------------
<S> <C> <C>
Sub-assemblies and purchased parts $10,823 $ 7,201
Finished goods 6,451 3,091
------- -------
$17,274 $10,292
======= =======
</TABLE>
(See note 5 for a description of the impact from the Heraeus Surgical,
Inc. acquisition.)
3. Net income (loss) per share for each period is calculated by dividing net
income (loss) by the weighted average number of shares of common stock and
common stock equivalents outstanding during the period (calculated using
the treasury stock method). Common stock equivalents consist of dilutive
shares issuable upon the exercise of outstanding common stock options. The
quarter and nine months ended September 30, 1996 shares reflect the
weighted average impact of approximately 4.6 million shares issued to
Heraeus Med, GmbH as partial consideration for the acquisition of Heraeus
Surgical, Inc. (HSI) (see note 5.)
4. The Company invests its excess cash in investment grade debt instruments.
The Company considers cash equivalents to be financial instruments that
are readily convertible to cash, subject to no more than insignificant
interest rate risk and that have original maturities of three months or
less. Short-term investments consist of financial instruments with less
than one year to maturity.
At September 30, 1996 and December 31, 1995 the Company's cash equivalents
were in the form of institutional money market accounts and totaled $1.15
million and $1.10 million, respectively. At September 30, 1996 and
December 31, 1995 the Company had no investment in short-term financial
instruments.
6
<PAGE> 7
5. During April 1996, the Company and Heraeus Med, GmbH signed a definitive
agreement for the acquisition (the "Acquisition") of HSI (a wholly-owned
subsidiary of Heraeus Med, GmbH). Pursuant to the Acquisition, Heraeus Med
received approximately 4.6 million shares of newly issued Laserscope
common stock and a $2.0 million cash payment in exchange for all of the
outstanding shares of HSI and certain assets and liabilities of Heraeus
Med's German laser distribution organization.
The Acquisition closed on August 30, 1996 and the purchase price was
allocated to the acquired assets and liabilities based on a determination
from an independent appraisal of their respective fair values. The
consolidation of the acquired assets and liabilities significantly
impacted the Company's Balance Sheet at September 30, 1996 as depicted in
the following tables:
The approximate purchase price for the Acquisition was (in thousands):
<TABLE>
<S> <C>
Newly issued Laserscope common stock $10,900
Cash paid 2,000
Estimated transaction and other direct acquisition costs 1,700
-------
Total $14,600
</TABLE>
The allocation of the approximate purchase price was determined as
follows:
<TABLE>
<S> <C>
Net tangible assets acquired:
Cash (before netting cash paid) $ 1,500
Accounts receivable, net 5,100
Inventories 8,700
Other assets 1,200
Less: accounts payable and other current liabilities (7,400)
-------
Total net tangible assets acquired $ 9,100
Intangible assets acquired:
Developed technology $ 2,700
In-process technology 2,400
Workforce 400
-------
$14,600
</TABLE>
The in-process technology was written off in the period ended September
30, 1996.
7
<PAGE> 8
6. The following unaudited pro forma combined results of operations of the
Company and Heraeus Surgical, Inc. (HSI) for the three and nine months
ended September 30, 1995 and September 30, 1996 have been prepared
assuming that the Acquisition had occurred at the beginning of the period
presented. The following pro forma information is not necessarily
indicative of the results that would have occurred had the Acquisition
been completed at the beginning of the period indicated, nor is it
indicative of future operating results (in thousands, except per share
data):
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenues ........................ $ 14,869 $ 13,506 $ 46,568 $ 43,693
Income (loss) from operations ....... (3,222) (2,061) (3,018) (4,076)
Net income (loss) ................... $ (3,213) $ (1,799) $ (2,843) $ (3,741)
Net income (loss) per share ......... $ (0.27) $ (0.15) $ (0.24) $ (0.32)
Shares used in per share
calculations ..................... 11,804 11,625 11,727 11,604
</TABLE>
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS:
Except for the historical information contained in this Quarterly Report on Form
10-Q, the matters discussed herein are forward-looking statements made pursuant
to the safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Investors are cautioned that all forward-looking statements are subject to
certain risks and uncertainties that could cause the actual results to differ
materially from those projected. Factors that could cause actual results to
differ materially include, but are not limited to, the risks associated with the
acquisition of HSI, including the integration of the assets acquired by
Laserscope, the timing of orders and shipments, the Company's ability to balance
its inventory and production schedules, the timely development and market
acceptance of new products and surgical/therapeutic procedures, the impact of
competitive products and pricing, the Company's ability to expand further into
international markets, public policy relating to health care reform in the
United States and other countries, approval of its products by government
agencies such as the United States Food and Drug Administration as well as
government agencies in other countries, and other risks included from time to
time in the Company's press announcements and public disclosure filings with the
United States Securities and Exchange Commission, copies of which are available
upon request from Laserscope's Investor Relations Department. The Company
assumes no obligation to update any forward-looking statements contained herein.
RESULTS OF OPERATIONS:
The following discussion should be read in conjunction with the unaudited
consolidated financial statements and notes thereto included in Part I -- Item 1
of this Quarterly Report and the audited financial statements and notes thereto
and Management's Discussion and Analysis of Financial Condition and Results of
Operations for the year ended December 31, 1995 contained in the Company's
Annual Report on Form 10-K, as amended.
Net revenues for the quarter and nine months ended September 30, 1996 were
$10.56 million and $26.76 million, respectively. Compared to the corresponding
quarter and nine months of 1995, these revenues increased approximately 50% and
16%, respectively. Net revenues increased during the quarter and nine months
ended September 30, 1996 relative to the corresponding period of 1995 primarily
as a result of higher unit shipments of the Company's KTP/YAG Surgical Laser
Systems, partially offset by lower average selling prices. In addition, the
Company recorded approximately $1.54 million in revenues from shipments of
products of HSI which was acquired August 30, 1996.
Revenues from the sales of capital equipment comprised approximately 55% and 48%
of net revenues during the quarter and nine months ended September 30, 1996,
respectively, compared to approximately 35% and 31% of net revenues during the
corresponding periods in 1995. During the quarter and nine months ended
September 30, 1996 these revenues increased 140% and 76%, respectively, compared
to the corresponding periods in 1995. Laser unit shipments were 279% and 144%
higher in the quarter and nine months ended September 30, 1996, respectively,
than the corresponding periods of 1995. However, average unit prices decreased
during these periods as a combined result of greater shipments of lower priced
Aura office laser units as well as increased shipments to independent
international distributors. The Company believes that the continuing trend
toward reduced health care costs in the United States is still a factor which
continues to impact negatively capital equipment procurement by its hospital
customers in the United States. As a result, the
9
<PAGE> 10
Company expects that its revenue mix trends for capital equipment in the U.S.
market will continue to shift toward its lower priced Aura office laser.
Revenues from the sales of disposable supplies, instrumentation and service
increased approximately 50% and 13% during the quarter and nine months ended
September 30, 1996, respectively, compared to the corresponding periods in 1995.
This increase was principally attributable to increased shipments of scanning
devices sold as accessories to the Aura office laser system, partially offset by
lower shipments of side-firing devices which the Company sells for use in
prostate surgeries. Revenues from the sales of disposable supplies,
instrumentation and service comprised 45% and 52% of net revenues during the
quarter and nine months ended September 30, 1996, respectively, compared to
approximately 48% and 51% of net revenues in the corresponding periods in 1995.
The decreases in percentage of net revenues were primarily the result of
revenues from the sales of capital equipment increasing at a faster rate than
revenues from the sales of disposable supplies, instrumentation and service.
The Company believes that acceptance of lasers in aesthetic surgery,
dermatology, urology, ear, nose and throat surgery, will continue to be
important to its business. In addition, the adoption of photodynamic therapy by
medical practitioners will be important. The Company continues to invest in
developing new instrumentation for emerging surgical applications and to educate
surgeons in the United States and internationally to encourage the adoption of
such new applications. Finally, penetration of the international market,
although increasing, has been limited.
Gross margin as a percentage of net revenues for the quarter ended September 30,
1996 was 51%, compared to 49% for the corresponding quarter in 1995. During the
nine months ended September 30, 1996, gross margin as a percentage of net
revenues was 50% compared to 52% in the corresponding period in 1995. The
increase in the quarter ended September 30, 1996 compared to the same quarter in
1995 was due primarily to higher production volumes. The decrease during the
nine months ended September 30, 1996 relative to the same period in 1995 is due
principally to a shift in product mix from higher margin side firing devices
used in prostate surgery to lower margin capital equipment products and to a
lesser extent, a higher proportion of revenues from sales to independent
international distributors during the first nine months of 1996 than in the
corresponding period of 1995. These revenues historically have generated lower
gross margins than those generated through the Company's direct sales force. In
addition, the Company continued to balance its inventories with product demand,
and reduced production volumes in the first nine months of 1996 relative to the
first nine months of 1995, which further negatively impacted gross margins
during the first nine months of 1996. The Company expects that gross margin as a
percentage of revenues for the remainder of 1996 and for 1997 will vary from
quarter to quarter as it continues to balance production volumes and inventory
levels with product demand and as product and distribution mix varies.
Research and development expenses, which are the result of activities related to
the development of new laser, instrumentation and disposable products and the
enhancement of the Company's existing products were approximately 37% and 41%
lower in the quarter and nine months ended September 30, 1996, respectively,
when compared to the corresponding periods in 1995. These decreases are the
combined result of expense control measures implemented by the Company during
the fourth quarter of 1995 and reduced spending on the Company's Aura office
laser which the Company shipped commercially commencing in December 1995. As a
percentage of net revenues these expenses were 6% and 7% in the
10
<PAGE> 11
quarter and nine months ended September 30, 1996, respectively, compared to 14%
and 13% in the corresponding periods in 1995, respectively. These reductions are
the combined result of significantly higher net revenues and lower spending. The
Company expects to increase amounts spent in research and development during the
remainder of 1996 and beyond; however, as a percentage of net revenues, these
amounts may vary from quarter to quarter as net revenues change.
Selling, general and administrative expenses in absolute dollars increased
approximately 13% in the quarter ended September 30, 1996, and decreased
approximately 3% during the nine months ended September 30, 1996, compared to
the corresponding periods of 1995. As a percentage of net revenues, selling,
general and administrative expenses were 41% and 40% for the quarter and nine
months ended September 30, 1996, respectively, compared to 54% and 48% in the
corresponding periods of 1995. The increase in absolute spending during the
quarter ended September 30, 1996 compared to the corresponding period in 1995
was due principally to additional expenses resulting from the acquisition of
HSI. The reduction in the expense levels during the first nine months of 1996
compared to the corresponding period of 1995 was principally the result of
expense reduction measures implemented by the Company during the fourth quarter
of 1995. The Company expects selling, general and administrative expenses to
remain at relatively high levels during 1996 and beyond since the Company
expects to continue to invest significant amounts in international expansion,
marketing programs and educational support.
During the quarter ended September 30, 1996, the Company recorded non-recurring
charges directly attributable to the acquisition of HSI consisting of a $2.38
million charge to write off purchased in-process research and development which
arose from the acquisition and of $0.87 million in charges to write off certain
inventory and fixed assets which became redundant as a result of the
Acquisition.
LIQUIDITY AND CAPITAL RESOURCES:
Total assets and liabilities as of September 30, 1996 were $41.11 million and
$15.08 million respectively, compared to assets and liabilities of $23.58
million and $6.24 million at December 31, 1995. Working capital increased $5.27
million from $12.56 million at December 31, 1995 to $17.83 million at September
30, 1996 while cash and cash equivalents increased $1.13 million from $2.28
million at December 31, 1995 to $3.41 million at September 30, 1996. The
increase to working capital was primarily the result of the HSI acquisition
which, net of cash paid to Heraeus Med and transaction expenses incurred, added
approximately $4.17 million to working capital. The net increase in cash and
cash equivalents was primarily due to cash provided by operating activities of
$2.58 million attributed to reductions of the Company's inventory by $1.71
million (without giving effect to the inventory acquired in the acquisition of
HSI), in addition to other cash provided by operations which totaled $0.87
million. The cash provided by operating activities was partially offset by $1.43
million used in the acquisition of HSI (net of cash received).
The Company anticipates that future changes in cash and working capital will be
dependent on a number of factors. As a result of the acquisition of HSI, the
Company's Balance Sheet liquidity ratios changed and the Company's ability to
generate cash will be partially dependent on management's ability to manage
effectively non-cash assets such as inventory and accounts receivable. In
addition, the level of profitability of the Company, as well as expenditures
relating to the HSI acquisition will have a significant impact on cash
resources. At September 30, 1996, the Company had commitments for capital
expenditures relating to
11
<PAGE> 12
facility improvements of approximately $0.80 million and other accrued
liabilities relating to the HSI acquisition of approximately $0.70 million.
The Company is currently negotiating the renewal of its $5.00 million revolving
bank line of credit which expired in October 1996. The Company expects to renew
the credit line by the end of 1996.
The Company's need for capital is affected by the current and anticipated demand
for its products as well as procurement and production lead times in its
manufacturing operations. Changes in these factors can have a significant impact
on capital requirements.
From time to time, the Company may also consider the acquisition of, or evaluate
investments in, certain products and businesses complementary to the Company's
business. Any such acquisition or investment may require additional capital
resources. During August 1996, the Company acquired HSI from Heraeus Med, GmbH.
Heraeus Med received approximately 4.6 million shares of newly issued Laserscope
common stock and $2.00 million in cash in exchange for all of the outstanding
shares of HSI and certain assets and liabilities of Heraeus Med's German laser
distribution organization. The Company financed the HSI acquisition using its
existing cash resources and anticipates that, while its remaining cash resources
will be sufficient to fund its short term operating needs, additional financing
either through bank line of credit or otherwise will be required for the
Company's currently envisioned long term needs.
12
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is a party to a number of legal proceedings arising in
the ordinary course of business. While it is not feasible to predict
or determine the outcome of the actions brought against it, the
Company believes that the ultimate resolution of these claims will
not ultimately have a material adverse effect on its financial
position or results of operations.
ITEM 2. CHANGES IN SECURITIES
Reference is made to Item 1 "Description of the Second Amendment
dated as of August 6, 1996 to the Common Share Rights Agreement
dated as of October 31, 1991, as amended by the First Amendment
dated April 22, 1996" of the Company's Registration Statement on
Form 8-A/A filed September 4, 1996 which is incorporated herein
by reference.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) A Special Meeting of Shareholders was held on August 29, 1996. Due
to insufficient votes necessary to constitute a quorum, the meeting
was adjourned to and re-convened on August 30, 1996, at which time a
quorum was present.
(b) The first matter voted upon at the meeting and the results of that
vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- -----------
<S> <C> <C> <C> <C>
To approve the 3,651,655 84,650 22,142 220,512
acquisition agreement
between the Company
and Heraeus Med GmbH,
dated April 23,1996 and the
transactions and agreements
contemplated thereby.
</TABLE>
13
<PAGE> 14
(c) The second matter voted upon at the meeting and the results of that
vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- -----------
<S> <C> <C> <C> <C>
To authorize an 2,501,094 935,410 321,943 220,512
amendment to the
Company's 1994 Stock
Option Plan to increase the
number of shares for issuance
thereunder by 975,000 shares to
an aggregate of 1,700,000 shares.
</TABLE>
(d) The third matter voted upon at the meeting and the results of that
vote were as follows:
<TABLE>
<CAPTION>
Present but
For Opposed Abstained Not Voting
--- ------- --------- -----------
<S> <C> <C> <C> <C>
To adopt the 2,850,701 783,889 344,369 0
Company's 1995 Directors'
Stock Option Plan and to
authorize the reservation of
300,000 shares of the
Company's stock thereunder.
</TABLE>
ITEM 5. OTHER ITEMS
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits filed herewith or incorporated herein (numbered in
accordance with Item 601 of Regulation S-K):
Exhibit
Number Description
- ------- -----------
4.1 Second Amendment to Common Shares Rights Agreement between the
Company and American Stock Transfer & Trust Company as Rights Agent
dated as of August 6, 1996 (incorporated by reference to the
Company's Form 8-A/A filed September 4, 1996.)
(b) Reports on Form 8-K: Report on Form 8-K (the "Form 8-K") dated
August 30, 1996 and filed on September 11, 1996. The Form 8-K
announced the consummation of the Company's acquisition of HSI and
related transactions.
14
<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.
LASERSCOPE
Registrant
/s/ Dennis LaLumandiere
--------------------------------------
Dennis LaLumandiere
Vice President of Finance
and Chief Financial Officer
(Principal Financial and Accounting Officer)
Date: November 12, 1996
15
<PAGE> 16
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
- ------- ------------------------------------------
<S> <C>
27.1 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 3,414
<SECURITIES> 0
<RECEIVABLES> 12,697
<ALLOWANCES> 1,156
<INVENTORY> 17,274
<CURRENT-ASSETS> 32,905
<PP&E> 17,398
<DEPRECIATION> 14,745
<TOTAL-ASSETS> 41,105
<CURRENT-LIABILITIES> 15,079
<BONDS> 0
0
0
<COMMON> 48,477
<OTHER-SE> (22,456)
<TOTAL-LIABILITY-AND-EQUITY> 41,105
<SALES> 26,764
<TOTAL-REVENUES> 26,764
<CGS> 13,366
<TOTAL-COSTS> 13,366
<OTHER-EXPENSES> 15,797
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (29)
<INCOME-PRETAX> (2,370)
<INCOME-TAX> 53
<INCOME-CONTINUING> (2,423)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,423)
<EPS-PRIMARY> (.32)
<EPS-DILUTED> (.32)
</TABLE>
