SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended June 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 0-19041
American Biogenetic Sciences, Inc.
( Exact name of registrant as specified in its charter)
Delaware 11-2655906
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
1375 Akron Street 516-789-2600
Copiague, New York 11726 (Telephone number)
(Address of principal executive offices)
1539 North Ironwood Drive, South Bend, IN 46635
(Former Name or Former Address, if Changed Since Last Report)
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
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at August 8, 1996
Class A Common Stock, par value $.001 16,159,661
Class B Common Stock, par value $.001 1,375,500
<PAGE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
Form 10-Q for the Quarter Ended June 30, 1996
INDEX
Part I - FINANCIAL INFORMATION
Item 1: Financial Statements: Page No.
Consolidated Balance Sheets -
June 30, 1996 and December 31, 1995 3
Consolidated Statements of Operations -
Three and Six Months Ended June 30, 1996 and June 30, 1995
and For the Period from Inception (September 1, 1983)
Through June 30, 1996 4
Consolidated Statements of Cash Flows -
Six Months Ended June 30, 1996 and June 30, 1995
and For the Period from Inception (September 1, 1983)
Through June 30, 1996 5
Consolidated Statements of Stockholders' Equity -
For the Period from Inception (September 1, 1983)
Through June 30, 1996 6 - 7
Notes to Consolidated Financial Statements 8 - 9
Item 2: Management's Discussion and Analysis of Financial Condition
and Results of Operations 10 - 12
Part II - OTHER INFORMATION
Item 4: Submission of Matters to a Vote of Security Holders 13
Item 6: Exhibits and Reports on Form 8-K 14
Signature 14
<TABLE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
<CAPTION>
June 30, December 31,
Assets 1996 1995
(UNAUDITED)
<S> <C> <C>
Current Assets:
Cash and cash equivalents 1,850,000 5,436,000
Marketable securities 6,676,000 4,397,000
Other current assets 130,000 163,000
------------ ------------
Total current assets 8,656,000 9,996,000
------------ ------------
Fixed assets, at cost, net of accumulated
depreciation and amortization of $1,039,000
and $902,000, respectively 626,000 714,000
Patent costs, net of accumulated
amortization of $181,000 and $154,000,
respectively 811,000 766,000
Debt issuance costs, net of accumulated
amortization of $264,000 and $168,000,
respectively 213,000 1,022,000
Other assets 20,000 23,000
------------ ------------
10,326,000 12,521,000
============ ============
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued expenses 554,000 508,000
Current portion of capital lease obligation 3,000 3,000
------------ ------------
Total current liabilities 557,000 511,000
------------ ------------
Long Term Liabilities:
8% convertible debentures 2,000,000 7,850,000
Long-term portion of capital lease obligation 13,000 15,000
------------ ------------
Total liabilities 2,570,000 8,376,000
------------ ------------
Commitments and Contingencies (Notes 1 and 3)
Stockholders' Equity:
Class A common stock, par value $.001 per
share; 50,000,000 shares authorized;
16,154,661 and 13,431,364 shares issued
and outstanding, respectively 16,000 13,000
Class B common stock, par value $.001 per
share; 3,000,000 shares authorized;
1,375,500 shares issued and outstanding 1,000 1,000
Additional paid-in capital 45,451,000 38,699,000
Deficit accumulated during the
development stage (37,712,000) (34,568,000)
------------ ------------
Total stockholders' equity 7,756,000 4,145,000
------------ ------------
10,326,000 12,521,000
============ ============
See notes to unaudited consolidated financial statements
Page 3
</TABLE>
<PAGE>
<TABLE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Period
<CAPTION> From Inception
Three Months Ended Six Months Ended (September 1,
1983) Through
June 30, June 30, June 30, June 30, June 30,
1996 1995 1996 1995 1996
<S> <C> <C> <C> <C> <C>
Revenues:
Royalties / license fees $ - $ - $ - $ - $1,000,000
Collaborative agreements 8,000 - 26,000 - 265,000
------------ ------------ ------------ ------------ --------------
8,000 - 26,000 - 1,265,000
Expenses:
Research and development 702,000 803,000 1,266,000 1,586,000 21,966,000
General and administrative 914,000 805,000 1,890,000 1,478,000 19,244,000
------------ ------------ ------------ ------------ --------------
Loss from operations (1,608,000) (1,608,000) (3,130,000) (3,064,000) (39,945,000)
------------ ------------ ------------ ------------ --------------
Other Income (Expense):
Interest expense (80,000) - (253,000) - (1,130,000)
Net gain on sale of fixed assets - - - - 6,000
Net investment income 110,000 70,000 239,000 156,000 3,357,000
------------ ------------ ------------ ------------ --------------
Net loss ($1,578,000) ($1,538,000) ($3,144,000) ($2,908,000) ($37,712,000)
============ ============ ============ ============ ==============
Net Loss Per Common Share ($0.09) ($0.11) ($0.19) ($0.20) ($5.75)
============ ============ ============ ============ ==============
Weighted Average Number of
Common Shares Outstanding 17,299,000 14,440,000 16,824,000 14,440,000 6,555,000
============ ============ ============ ============ ==============
See notes to unaudited consolidated financial statements
Page 4
</TABLE>
<PAGE>
<TABLE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Period
From Inception
<CAPTION> (September 1,
Six Months Ended 1983)
Through
June 30, June 30, June 30,
1996 1995 1996
<S> <C> <C> <C>
Cash Flows From Operating Activities:
Net loss ($3,144,000) ($2,908,000) ($37,712,000)
Adjustments to reconcile net (loss) to
net cash used in operating activities:
Depreciation and amortization 260,000 154,000 1,413,000
Net (gain)/loss on sale of fixed assets - (3,000) (6,000)
Net (gain)/loss on sale of marketable securities - - (217,000)
Other non-cash expenses accrued primarily for warrants 201,000 - 1,353,000
Write off of patent costs - - 93,000
(Increase) decrease in other current assets 33,000 23,000 (130,000)
(Increase) decrease in other assets 3,000 (3,000) 75,000
Increase (decrease) in payables and accruals 198,000 66,000 596,000
Increase in interest payable to stockholder - - 112,000
------------ ------------ --------------
Net cash used in operating activities (2,449,000) (2,671,000) (34,423,000)
------------ ------------ --------------
Cash Flows From Investing Activities:
Capital expenditures (49,000) (45,000) (1,671,000)
Proceeds from sale of fixed assets - 8,000 16,000
Payments for patent costs and other assets (72,000) (63,000) (1,062,000)
Proceeds from maturity and sale of marketable securities 4,397,000 2,567,000 55,031,000
Purchases of marketable securities (6,676,000) - (61,490,000)
------------ ------------ --------------
Net cash provided by (used in) investing activities (2,400,000) 2,467,000 (9,176,000)
------------ ------------ --------------
Cash Flows From Financing Activities:
Proceeds from issuance of common stock, net 1,265,000 - 35,294,000
Proceeds from issuance of 8% convertible debentures, net - - 7,790,000
Principal payments under capital lease obligation (2,000) (1,000) (4,000)
Capital contributions from chairman - - 1,000,000
Increase in loans payable to stockholder / affiliates - - 2,669,000
Repayment of loans payable to stockholder and affiliates
(remainder contributed to capital by the stockholder) - - (1,300,000)
------------ ------------ --------------
Net cash provided by (used in) financing activities 1,263,000 (1,000) 45,449,000
------------ ------------ --------------
Net Increase (Decrease) in Cash and Cash Equivalents (3,586,000) (205,000) 1,850,000
Cash and Cash Equivalents at Beginning of Period 5,436,000 2,029,000 -
------------ ------------ --------------
Cash and Cash Equivalents at End of Period $1,850,000 $1,824,000 $1,850,000
============ ============ ==============
Supplemental Disclosure of Noncash Activities:
Capital expenditures made under capital lease obligation - $20,000 $20,000
============ ============ ==============
8% Convertible Debentures converted into 2,206,172, 0,
and 2,420,349 shares of Common Stock, respectively $5,289,000 - $5,860,000
============ ============ ==============
Warrants issued to placement agent - - $480,000
============ ============ ==============
See notes to unaudited consolidated financial statements
Page 5
</TABLE>
<PAGE>
<TABLE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<CAPTION>
Class A Class B
Per Common Stock Common Stock
Share --------------------------- ------------------------
Amount Shares Dollars Shares Dollars
------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C>
BALANCE, AT INCEPTION, (SEPTEMBER 1, 1983) $ - $ - - $ -
Sale of common stock to chairman for cash .33 78,000 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1983 78,000 - - -
Sale of common stock to chairman for cash .33 193,500 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1984 271,500 - - -
Sale of common stock to chairman for cash .33 276,700 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1985 548,200 1,000 - -
Sale of common stock to chairman for cash .33 404,820 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1986 953,020 1,000 - -
Sale of common stock to chairman for cash .33 48,048 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1987 1,001,068 1,000 - -
Exchange of common stock for Class B stock (1,001,068) (1,000) 1,001,068 1,000
Sale of Class B stock to chairman for cash .33 - - 1,998,932 2,000
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1988 - - 3,000,000 3,000
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1989 - - 3,000,000 3,000
Conversion of loans payable to stockholder into
additional paid-in capital - - - -
Sale of 1,150,000 Units to public consisting of
3,450,000 shares of Class A common stock and
warrants (net of $1,198,000 underwriting exp 2.00 3,450,000 3,000 - -
Conversion of Class B stock into
Class A stock 668,500 1,000 (668,500) (1,000)
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1990 4,118,500 $4,000 2,331,500 $2,000
------------ ------------- ----------- -----------
CONTINUED
Page 6
<PAGE>
BALANCE, DECEMBER 31, 1990 4,118,500 $4,000 2,331,500 $2,000
Exercise of Class A Warrants (net of $203,000
in underwriting expenses) for cash 3.00 3,449,955 3,000 - -
Exercise of Class B Warrants for cash 4.50 79,071 - - -
Conversion of Class B stock
into Class A stock 850,000 1,000 (850,000) (1,000)
Exercise of stock options 2.00 417,750 1,000 - -
Expense for warrants issued - - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1991 8,915,276 9,000 1,481,500 1,000
Exercise of Class B Warrants (net of $701,000
in underwriting expenses) for cash 4.50 3,370,884 3,000 - -
Conversion of Class B stock
into Class A stock 106,000 - (106,000) -
Exercise of stock options 2.49 348,300 1,000 - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1992 12,740,460 13,000 1,375,500 1,000
Sale of common stock to Medeva PLC. 7.50 200,000 - - -
Exercise of stock options 2.00 32,700 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1993 12,973,160 13,000 1,375,500 1,000
Exercise of stock options 2.16 91,250 - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1994 13,064,410 13,000 1,375,500 1,000
Conversion of 8% Convertible Debentures into
Class A Common Stock 1.85 354,204 -
Exercise of stock options 1.82 12,750 -
Expense for warrants/options issued - - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, DECEMBER 31, 1995 13,431,364 13,000 1,375,500 1,000
Conversion of 8% Convertible Debentures into
Class A Common Stock 2.72 2,206,172 2,000
Exercise of stock options 2.45 517,125 1,000
Expense for warrants/options issued - - - -
Net (loss) for the period - - - -
------------ ------------- ----------- -----------
BALANCE, JUNE 30, 1996 16,154,661 $16,000 1,375,500 $1,000
============ ============= =========== ===========
See notes to unaudited consolidated financial statements
Page 7
</TABLE>
<PAGE>
<TABLE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Deficit
Accumulated
Additional During the
Paid-in Development
Capital Stage Total
------------ ------------- -----------
<S> <C> <C> <C>
BALANCE, AT INCEPTION, (SEPTEMBER 1, 1983) $ - $ - $ -
Sale of common stock to chairman for cash 26,000 - 26,000
Net (loss) for the period - (25,000) (25,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1983 26,000 (25,000) 1,000
Sale of common stock to chairman for cash 65,000 - 65,000
Net (loss) for the period - (242,000) (242,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1984 91,000 (267,000) (176,000)
Sale of common stock to chairman for cash 92,000 - 92,000
Net (loss) for the period - (305,000) (305,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1985 183,000 (572,000) (388,000)
Sale of common stock to chairman for cash 134,000 - 134,000
Net (loss) for the period - (433,000) (433,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1986 317,000 (1,005,000) (687,000)
Sale of common stock to chairman for cash 16,000 - 16,000
Net (loss) for the period - (730,000) (730,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1987 333,000 (1,735,000) (1,401,000)
Exchange of common stock for Class B stock - - -
Sale of Class B stock to chairman for cash 664,000 - 666,000
Net (loss) for the period - (1,031,000) (1,031,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1988 997,000 (2,766,000) (1,766,000)
Net (loss) for the period - (1,522,000) (1,522,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1989 997,000 (4,288,000) (3,288,000)
Conversion of loans payable to stockholder into
additional paid-in capital 1,481,000 - 1,481,000
Sale of 1,150,000 Units to public consisting of
3,450,000 shares of Class A common stock and
warrants (net of $1,198,000 underwriting expenses) 5,699,000 - 5,702,000
Conversion of Class B stock into
Class A stock - - -
Net (loss) for the period - (2,100,000) (2,100,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1990 $8,177,000 ($6,388,000) $1,795,000
------------ ------------- -----------
CONTINUED
Page 6 (column continuation)
<PAGE>
BALANCE, DECEMBER 31, 1990 $8,177,000 ($6,388,000) $1,795,000
Exercise of Class A Warrants (net of $203,000
in underwriting expenses) for cash 10,143,000 - 10,146,000
Exercise of Class B Warrants for cash 356,000 - 356,000
Conversion of Class B stock
into Class A stock - - -
Exercise of stock options 835,000 - 836,000
Expense for warrants issued 900,000 - 900,000
Net (loss) for the period - (4,605,000) (4,605,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1991 20,411,000 (10,993,000) 9,428,000
Exercise of Class B Warrants (net of $701,000
in underwriting expenses) for cash 14,465,000 - 14,468,000
Conversion of Class B stock
into Class A stock - - -
Exercise of stock options 865,000 - 866,000
Net (loss) for the period - (4,016,000) (4,016,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1992 35,741,000 (15,009,000) 20,746,000
Sale of common stock to Medeva PLC. 1,500,000 - 1,500,000
Exercise of stock options 65,000 - 65,000
Net (loss) for the period - (6,521,000) (6,521,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1993 37,306,000 (21,530,000) 15,790,000
Exercise of stock options 197,000 - 197,000
Net (loss) for the period - (7,431,000) (7,431,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1994 37,503,000 (28,961,000) 8,556,000
Conversion of 8% Convertible Debentures into
Class A Common Stock 571,000 - 571,000
Exercise of stock options 23,000 - 23,000
Expense for warrants/options issued 602,000 - 602,000
Net (loss) for the period - (5,607,000) (5,607,000)
------------ ------------- -----------
BALANCE, DECEMBER 31, 1995 38,699,000 (34,568,000) 4,145,000
Conversion of 8% Convertible Debentures into
Class A Common Stock 5,287,000 - 5,289,000
Exercise of stock options 1,264,000 - 1,265,000
Expense for warrants/options issued 201,000 - 201,000
Net (loss) for the period - (3,144,000) (3,144,000)
------------ ------------- -----------
BALANCE, JUNE 30, 1996 $45,451,000 ($37,712,000) $7,756,000
============ ============= ===========
See notes to unaudited consolidated financial statements
Page 7 (column continuation)
</TABLE>
<PAGE>
AMERICAN BIOGENETIC SCIENCES, INC. AND SUBSIDIARY
(a development stage company)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
June 30, 1996
(1) INTERIM FINANCIAL STATEMENTS
The interim unaudited consolidated financial statements presented herein
have been prepared in accordance with generally accepted accounting
principles for interim financial statements and with the instructions to
Form 10-Q and Regulation S-X pertaining to interim financial statements.
Accordingly, they do not include all information and footnotes required
by generally accepted accounting principles for complete financial
statements. The interim financial statements presented herein reflect
all adjustments (consisting of normal recurring adjustments and
accruals) which, in the opinion of management, are necessary for a fair
presentation of financial position as of June 30, 1996 and results of
operations for the three and six months ended June 30, 1996 and June 30,
1995. The Company's financial statements should be read in conjunction
with the summary of significant accounting policies and the notes to
consolidated financial statements 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 six months ended June 30, 1996 are not
necessarily indicative of the results for the full year.
<PAGE>
(2) STOCKHOLDERS' EQUITY
Stock Options - The following summarizes the stock option activity for
the three months ended June 30, 1996.
1986 Plan Shares Price
Granted 79,500 $5.00 - $5.50
Exercised 160,750 $1.50 - $5.50
Cancelled 81,750 $1.50 - $3.50
1993 Plan Shares Price
Granted 20,000 $6.75
Exercised 10,000 $3.375 - $4.125
Cancelled 17,500 $2.750 - $4.125
1996 Plan There were no shares granted, exercised or canceled
during the three months ended June 30, 1996.
Each option entitles the holder to purchase one share of Class A Common
Stock of the Company.
On March 29, 1996, the Board of Directors adopted, and on June 10, 1996,
the Company's stockholders approved, the Company's 1996 Stock Option
Plan which authorizes the grant of options to purchase 1,000,000 shares
of the Company's Class A Common Stock to employees and consultants.
(3) LEGAL MATTERS
On December 13, 1994, certain stockholders filed a complaint,
and on August 5, 1995, certain other stockholders filed a similar
complaint, in the United States District Court for the Eastern District
of New York against the Company and certain of its present and former
executive officers and directors. The complaints allege, among other
things, that such persons made misleading statements relating to the
Company. The actions seek an unspecified amount of damages and possible
equitable relief.
While both of these matters are in very early stages, the
Company and its officers believe that the actions are without merit and
have denied liability and intend to vigorously defend the suits.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
Three Months Ended June 30, 1996
The Company's net loss of $1,578,000 for the second quarter ended June
30, 1996 was $40,000 higher than the net loss of $1,538,000 for the
second quarter ended June 30, 1995.
Research and development expenses decreased from $803,000 to $702,000
primarily as a result of reduced personnel, reduced payments for
research/collaborative projects, and reduced consulting services.
General and administrative expenses increased from $805,000 to $914,000
as a result of increased public relations costs, and increased personnel
offset by a reduction in consulting services.
Interest expense of $80,000, including $29,000 of amortization of the
debt issuance costs, resulted from the issuance of $8.5 million of 8%
Convertible Debentures in late October 1995. The debt issuance costs
are being amortized as a component of interest expense over the term of
the debentures. Upon the conversion of debentures ($450,000 during the
second quarter of 1996) the related unamortized debt issuance costs
($48,000 during the second quarter of 1996) are charged to paid-in
capital.
Investment income increased $40,000 from $70,000 in the 1995 period to
$110,000 in the 1996 period as a result of higher average cash balances
offset, in part, by lower interest rates on U.S. Government obligations
in which most of the Company's available cash is invested.
<PAGE>
Six Months Ended June 30, 1996
The Company's net loss increased $236,000 during the six months ended
June 30, 1996 from a loss of $2,908,000 during the 1995 period to a loss
of $3,144,000 in 1996.
Research and development expenses decreased from $1,586,000 to
$1,266,000 primarily as a result of reduced personnel and reduced
payments for research/collaborative projects.
General and administrative expenses increased from $1,478,000 to
$1,890,000 as a result of increased public relations costs, consulting
costs and travel and meeting costs.
Interest expense of $253,000 resulted from the issuance of $8.5 million
of 8% Convertible Debentures in late October 1995. Included in the 1996
interest expense is $96,000 of amortization of the debt issuance costs.
The debt issuance costs are being amortized as a component of interest
expense over the term of the debentures. Upon the conversion of
debentures ($5,850,000 during the six months ended June 30, 1996) the
related unamortized debt issuance costs ($713,000 during the second
quarter of 1996) are charged to paid-in capital.
Interest income increased $83,000 from $156,000 in 1995 as a result of
higher average fund balances.
Liquidity and Capital Resources
As of June 30, 1996, the Company had working capital of $8,099,000
compared to $9,485,000 at December 31, 1995. The Company's management
believes that current working capital will be sufficient to fund its
liquidity needs through 1996 and beyond. During the six months ended
June 30, 1996, $5,850,000 of the 8% Convertible Debentures were
converted into 2,206,172 Class A Common shares.
<PAGE>
The Company expects to continue to incur substantial expenditures in
research and product development and the FDA approval process, relating
to Phase I and Phase II human clinical testing of the MH1 imaging
product and 510(k) filings for TpP , the Company's Thrombus Precursor
Protein diagnostic tests, and FiF , the Company's Functional Intact
Fibrinogen diagnostic test. Currently product development plans of the
Company include entering into collaborative, licensing and co-marketing
arrangements with large pharmaceutical companies to provide additional
funding and clinical expertise to perform tests necessary to obtain
regulatory approvals, provide manufacturing expertise and market the
Company's products. Without such collaborative, licensing or co-marketing
arrangements, longer term, additional sources of funding will
be required to finance the Company.
<PAGE>
PART II
OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
At the Company's 1996 Meeting of Stockholders held on June 10, 1996:
(a) The following six directors, each of whom were nominated by the
Board of Directors were elected by the following votes:
Voting Authority
For Withheld
Alfred J. Roach 27,634,604 460,670
Dr. Paul E. Gargan 27,647,569 447,705
Ellena M. Byrne 27,649,719 445,555
Timothy J. Roach 27,624,324 470,950
Joseph C. Hogan 27,645,819 449,455
William G. Sharwell 27,636,519 458,755
(b) Authorized an amendment to the Company's Certificate of
Incorporation to increase the number of shares of Class A Common Stock,
$.001 par value, which the Company is authorized to issue from
25,000,000 shares to 50,000,000 shares by the following vote:
For Against Abstain Broker Non-Votes
Votes by Class A
Common Stock 12,794,279 1,380,691 164,304 -
Votes by Class B
Common Stock 1,375,500 - - -
(c) Approved the Company's 1996 Stock Option Plan, by the following
vote:
For Against Abstain Broker Non-Votes
19,449,072 1,338,936 185,953 7,121,313
(d) Ratified the appointment of Arthur Andersen LLP to serve as the
Company's independent public auditors for the year ending December 31,
1996 by the following vote:
For Against Abstain
27,933,714 55,460 106,100
Each matter was approved by the vote of Common Class A and Class B
stockholders voting together as one class, with each share of Class A
having one vote and each share of Class B having ten votes, except that
the proposal to amend the Company's Certificate of Incorporation was
approved by separate vote of each class.
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
3.1 Restated Certificate of Incorporation -
Incorporated by reference to Exhibit 4.01 to the
Company's Registration Statement on Form S-8, File
No. 333-09473.
3.2 Amended By-Laws of the Company - Incorporated by
reference to Exhibit 4.02 to the Company's
Registration Statement on Form S-8, File No. 333-09473.
27 Financial Data Schedule - filed herewith.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter
ended June 30, 1996.
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.
AMERICAN BIOGENETIC SCIENCES, INC.
(Registrant)
Date August 13, 1996 /s/ Josef C. Schoell
--------------- --------------------
Josef C. Schoell
Vice President, Finance
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SIX MONTH YEAR-TO-DATE SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM AMERICAN BIOGENETIC SCIENCES INC. 1996
SECOND QUARTER FORM 10-Q JUNE 30,1996
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1996
<CASH> 1,850,000
<SECURITIES> 6,676,000
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 8,656,000
<PP&E> 1,665,000
<DEPRECIATION> 1,039,000
<TOTAL-ASSETS> 10,326,000
<CURRENT-LIABILITIES> 557,000
<BONDS> 2,000,000
0
0
<COMMON> 17,000
<OTHER-SE> 7,739,000
<TOTAL-LIABILITY-AND-EQUITY> 10,326,000
<SALES> 0
<TOTAL-REVENUES> 26,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,266,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 253,000
<INCOME-PRETAX> (3,144,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,144,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,144,000)
<EPS-PRIMARY> (.19)
<EPS-DILUTED> (.19)
</TABLE>
