<PAGE>
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 June 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: 0-18338
-----------
I-Flow Corporation
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 33-0121984
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2532 White Road, Irvine, CA 92614
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(714)553-0888
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
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. [ X ] Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
[ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
As of July 23, 1996, there were 11,144,561 shares outstanding of
Common Stock and 656,250 shares outstanding of Series B Preferred Stock.
<PAGE>
I-FLOW CORPORATION
FORM 10-Q
JUNE 30, 1996
TABLE OF CONTENTS
Page
Part I: Financial Information
Balance Sheets as of June 30, 1996 (Unaudited) and
December 31, 1995 3
Statements of Operations for the three and six-month
periods ended June 30, 1996 and 1995 (Unaudited) 4
Statements of Cash Flows for the six-month periods
ended June 30, 1996 and 1995 (Unaudited) 5
Notes to Financial Statements 6
Management's Discussion and Analysis of Results of
Operations and Financial Condition 9
Part II: Other Information 12
Signatures 13
2
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I-FLOW CORPORATION
BALANCE SHEETS
June 30, December 31,
1996 1995
----------- ------------
ASSETS (Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $10,443,000 $ 5,628,000
Accounts receivable, net 1,109,000 1,567,000
Inventories 1,517,000 1,067,000
Prepaids and other 129,000 75,000
----------- -----------
Total current assets 13,198,000 8,337,000
----------- -----------
PROPERTY:
Furniture, fixtures and equipment 1,723,000 1,494,000
Rental and demonstration equipment 175,000 156,000
----------- -----------
Total property 1,898,000 1,650,000
Less accumulated depreciation (1,275,000) (1,155,000)
----------- -----------
Property, net 623,000 495,000
----------- -----------
OTHER ASSETS 432,000 275,000
----------- -----------
TOTAL $14,253,000 $ 9,107,000
----------- -----------
----------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $477,000 $260,000
Accrued payroll and related expenses 438,000 553,000
Deferred revenue 430,000 516,000
Other liabilities 38,000 50,000
----------- -----------
Total current liabilities 1,383,000 1,379,000
----------- -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock - no par value;
5,000,000 shares authorized;
656,250 series B shares issued
and outstanding at June 30, 1996
and 1995, respectively
(aggregate preference on
liquidation is $1,575,000) 1,494,000 1,494,000
Common stock - no par value;
40,000,000 shares authorized;
10,711,543 shares issued and
outstanding at June 30, 1996,
8,201,834 shares issued and
outstanding at December 31, 1995 28,326,000 24,278,000
Accumulated deficit (16,950,000) (18,044,000)
----------- -----------
Net shareholders' equity 12,870,000 7,728,000
----------- -----------
TOTAL $14,253,000 $ 9,107,000
----------- -----------
----------- -----------
See accompanying notes to financial statements
3
<PAGE>
I-FLOW CORPORATION
STATEMENTS OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- ------------------------
1996 1995 1996 1995
---------- ---------- ----------- -----------
REVENUES:
Net sales $ 970,000 $2,396,000 $ 1,686,000 $ 4,449,000
Rental income 23,000 16,000 26,000 41,000
Interest income 114,000 21,000 183,000 47,000
Licensing fees 1,300,000 2,600,000
Other income 2,000 18,000
---------- ---------- ----------- -----------
Total revenues 2,409,000 2,433,000 4,513,000 4,537,000
---------- ---------- ----------- -----------
COSTS AND EXPENSES:
Cost of sales 536,000 1,055,000 906,000 1,930,000
Selling and marketing 445,000 388,000 732,000 807,000
General and administrative 639,000 584,000 1,311,000 1,121,000
Product development 238,000 230,000 470,000 442,000
---------- ---------- ----------- -----------
Total costs and expenses 1,858,000 2,257,000 3,419,000 4,300,000
---------- ---------- ----------- -----------
NET INCOME $ 551,000 $ 176,000 $ 1,094,000 $ 237,000
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
NET INCOME PER SHARE $0.05 $0.02 $0.10 $0.03
---------- ---------- ----------- -----------
WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON
EQUIVALENT SHARES
OUTSTANDING 12,773,754 8,901,922 12,519,436 8,901,878
---------- ---------- ----------- -----------
See accompanying notes to financial statements
4
<PAGE>
I-FLOW CORPORATION
STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 30,
-----------------------
1996 1995
----------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,094,000 $ 237,000
Adjustments to reconcile net income
to net cash provided by operations:
Depreciation 120,000 90,000
Changes in operating assets and liabilities:
Accounts receivable 458,000 (24,000)
Inventories (450,000) (593,000)
Prepaid expenses and other (54,000) (13,000)
Accounts payable and other liabilities 4,000 (499,000)
----------- ---------
Net cash provided by (used by) operating activities 1,172,000 (802,000)
----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions (including rental and
demonstration equipment) (248,000) (111,000)
Change in other assets (157,000) (51,000)
----------- ---------
Net cash used by investing activities (405,000) (162,000)
----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options
and warrants 4,048,000
----------- ---------
Net cash provided by financing activities 4,048,000
----------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 4,815,000 (964,000)
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 5,628,000 1,834,000
----------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $10,443,000 $ 870,000
----------- ---------
----------- ---------
See accompanying notes to financial statements
5
<PAGE>
I-FLOW CORPORATION
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements contain all adjustments
(consisting only of normal recurring adjustments) which, in the opinion of
management, are necessary to present fairly the financial position of the
Company at June 30, 1996 and the results of its operations and its cash
flows for the six-month periods ended June 30, 1996 and 1995. Certain
information and footnote disclosures normally included in financial
statements have been condensed or omitted pursuant to rules and regulations
of the Securities and Exchange Commission although the Company believes
that the disclosures in the financial statements are adequate to make the
information presented not misleading.
The financial statements included herein should be read in conjunction with
the financial statements of the Company, included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1995 filed with the
Securities and Exchange Commission on March 27, 1996.
Certain amounts previously reported have been reclassified to conform with
the presentation at June 30, 1996.
2. COMMON STOCK OPTIONS AND WARRANTS
The Company has stock option plans which currently provide for the granting
of options to employees, officers, consultants and directors. Stock option
activity for the six-month period ended June 30, 1996 is summarized as
follows:
Shares Exercise
Subject to Price per
Options Share
---------- -------------
Balance, December 31, 1995 2,478,888 $0.25 - $5.15
Granted 60,000 $5.38
Exercised (227,065) $0.25 - $4.05
--------- -------------
Balance, June 30, 1996 2,311,823 $0.25 - $5.38
--------- -------------
Options to purchase 1,229,095 shares of the Company's common stock were
exercisable at June 30, 1996 at exercise prices ranging from $0.25 to
$5.38 per share.
6
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Outstanding warrants as of June 30, 1996 are summarized below. During
the six-month period ended June 30, 1996, Series G Warrants to purchase
1,225,253 shares of the Company's Common Stock were exercised raising
net proceeds of approximately $3,600,000.
Shares Subject Exercise Price
Description to Warrants Per Share Expiration Date
----------- -------------- --------------- ---------------
Underwriter Warrants 46,051 $6.79 February 1997
Series F Warrants 607,032 $2.40 to $4.80 October 1997
Series G Warrants 784,702 $3.00 December 1996
Series H Warrants 150,000 $2.75 to $3.25 March 1997
3. BANK FINANCING
During the year ended December 31, 1995, the Company entered into a
financing agreement with a bank which provides for a working line of
credit expiring in August 1996. Under the line of credit, the Company
may borrow up to the lesser of $1,500,000 (increased to $3,000,000 in
July 1996) or 75% of eligible accounts receivable, as defined, at a
bank's prime rate plus 1% (10.75% at June 30, 1996). There were no
borrowings under the line during the quarter ended June 30, 1996.
4. LICENSING FEE
In November 1994, the Company signed an exclusive national distribution
agreement with SoloPak Pharmaceuticals Inc. (SoloPak) for the
SIDEKICK-TM-, PARAGON-TM- and ELITE-TM- product lines. In February 1996,
this agreement was superseded with a new agreement in which SoloPak
purchased the exclusive right and license to manufacture and sell the
products in the United States and Puerto Rico. Pursuant to the new
agreement, SoloPak paid the Company $1.3 million in consideration of the
license in February 1996 and will pay the Company guaranteed royalties
of $1.0 million during each of the three succeeding quarters in 1996.
Additionally, SoloPak will pay I-Flow a royalty equal to two percent of
its net sales of the products for the 1997 and 1998 calendar years. Per
the terms of the agreement, I-Flow has the right of first refusal to
supply SoloPak with services and assistance in assembling the completed
products until February 1998. The Company retained the rights to sell
the products outside the United States and Puerto Rico.
5. SUBSEQUENT EVENT
On July 3, 1996, the Company entered into an agreement for the purchase
of substantially all of the assets of Block Medical, Inc. The
transactions contemplated by this agreement were consummated on July 22,
1996. The assets were acquired for an aggregate purchase price of
approximately $17.5 million (subject to certain possible post-closing
adjustments). The purchase price will be allocated to the net assets
acquired, in-process research and
7
<PAGE>
development and goodwill. The amount allocated to in-process research
and development of approximately $5 million has been expensed as of the
acquisition date. Consideration for the purchase consisted of: cash of
$15,000,000, 433,018 shares of I-Flow Corporation Common Stock with a
value of $2,000,000 as of the date of closing, and a warrant to purchase
250,000 shares of I-Flow Corporation Common Stock at an exercise price of
$4.62, expiring July 22, 2001.
In conjunction with the aforementioned acquisition, the Company entered
into a $4,000,000 note payable with a bank due in monthly installments
bearing interest at the bank's prime rate plus 1.5% (11.25% at June 30,
1996) through July 2000. The note is collateralized by substantially
all of the Company's assets and requires the Company to comply with
certain covenants.
Additionally, the Company increased the maximum available borrowing
limit on its line of credit from $1,500,000 to $3,000,000 in July 1996
(See Note 3) and extended the expiration date to July 1997.
8
<PAGE>
I-FLOW CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
When used in this discussion, the words "believes", "anticipates" and
similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks and
uncertainties which could cause actual results to differ materially
from those projected. Readers are cautioned not to place undue
reliance on these forward-looking statements which speak only as of the
date hereof. The Company undertakes no obligation to republish revised
forward-looking statements to reflect the occurrence of unanticipated
events. Readers are also urged to carefully review and consider the
various disclosures made by the Company in this report which seek to
advise interested parties of the factors that affect the Company's
business, as well as in the Company's periodic reports on Forms 10-K,
10Q and 8K filed with the Securities and Exchange Commission.
RESULTS OF OPERATIONS
Net sales during the three and six-month periods ended June 30, 1996
were $970,000 and $1,686,000, respectively, compared to $2,396,000 and
$4,449,000 for the same periods in the prior year. However, during the
three and six-month periods ended June 30, 1996, the Company received
licensing fees of $1,300,000 and $2,600,000, respectively which brought
total revenues for these periods to $2,409,000 and $4,513,000,
respectively compared to $2,433,000 and $4,537,000 for the same periods
in the prior year.
In November 1994, the Company signed an exclusive distribution agreement
with SoloPak Pharmaceuticals Inc. (SoloPak) for the SIDEKICK-TM-,
PARAGON-TM-, and ELITE-TM- product lines. Sales to SoloPak were
approximately $2,436,000 for the six month period ended June 30, 1995,
whereas there were no sales to SoloPak during 1996.
In February 1996, this agreement was superseded with a new agreement in
which SoloPak purchased the exclusive right and license to manufacture
and sell the products in the United States and Puerto Rico. Pursuant to
the new agreement, SoloPak paid the Company $1.3 million in
consideration of the license in February 1996 and agreed to pay the
Company guaranteed royalties of $1.0 million during each of the three
succeeding quarters in 1996. Additionally, SoloPak agreed to pay I-Flow
a royalty equal to two percent of its net sales of the products for the
1997 and 1998 calendar years. Per the terms of the agreement, I-Flow
has the right of first refusal to supply SoloPak with services and
assistance in assembling the products until February 1998. The Company
retained the right to sell the products outside the United States and
Puerto Rico.
Cost of sales of $536,000 and $906,000 were incurred during the three
and six-month periods ended June 30, 1996, respectively. As a percentage
of net sales, cost of sales increased by 11% for both the three and
six-month periods ended June 30, 1996 compared to the same periods in
the prior year. This decrease in gross profit on sales is primarily the
result of the lower sales volume in relation to fixed costs.
9
<PAGE>
Selling and marketing expenses for the three-month period ended June 30,
1996 increased over the same period in the prior year by $57,000, or 15%
while these expenses decreased for the six month period ended June 30,
1996 over the same period in the prior year by $75,000 or 9%. The
increase over the prior year for the three month period primarily
resulted from the payment of a consulting fee associated with a
distribution agreement, while the decrease over the prior year for the
six month period primarily resulted from a reduction in the Company's
internal sales force, as the Company currently generates most of its
sales through outside distributors.
General and administrative expenses for the three and six-month periods
ended June 30, 1996 increased over the same period in the prior year by
$55,000, or 9% and $190,000, or 17%, respectively. These expenses
primarily represent costs for administrative personnel, facilities and
other miscellaneous items. These costs have increased primarily as a
result of increased costs for investor relations and professional fees.
Product development expenses for the three and six-month periods ended
June 30, 1996 increased compared to those for the same period in the prior
year by $8,000, or 3% and $28,000, or 6%, respectively. The Company
will continue to incur product development expenses as it continues its
efforts to introduce new improved-technology, cost-efficient products
into the market.
FINANCIAL CONDITION
During the six-month period ended June 30, 1996, funds of $1,172,000
were provided by operating activities primarily from net income of
$1,094,000, plus non-cash expenses of $120,000 for depreciation less net
changes in operating assets and liabilities of $42,000. The changes in
operating assets and liabilities consisted primarily of a decrease in
accounts receivable of $458,000 less a net increase in inventories,
prepaid expenses and other and accounts payable and other liabilities of
$500,000.
The Company used funds for investing activities during the six-month
period ended June 30, 1996 by acquiring property (including rental and
demonstration equipment) and other assets aggregating $405,000.
During the six-month period ended June 30, 1996, funds of $4,048,000
were provided by financing activities consisting of proceeds from the
exercise of stock options and Series G Warrants.
As of June 30, 1996, the Company had available funds of $10,443,000 and
net receivables of $1,109,000. In July 1996, the Company received
additional funds of approximately $1,458,000 from the exercise of certain
warrants. From these funds $11,000,000 was used in the acquisition
of the assets of Block Medical, Inc. in July 1996 as noted in Note 5 to
the Notes to Financial Statements. To date, the Company has financed its
operations and working capital requirements primarily through equity
financings. Management believes the Company's funds are sufficient to
provide for its short-term projected needs for operations.
10
<PAGE>
PART II - OTHER INFORMATION
Items 1. - 3. Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
(a) On May 17, 1996, the Company held its Annual Shareholders'
Meeting.
(b) Donald M. Earhart, Jack H. Halperin, Dr. John H. Abeles,
Erik H. Loudon, Dr. Henry T. Tai, Charles C. McGettigan,
and Joel S. Kanter were elected as Directors of the
Company at the Annual Shareholders' Meeting.
(c) A total of 9,942,318 of the outstanding voting securities
were represented at the Annual Shareholders' Meeting by
proxy or in person. All matters voted upon and approved at
the Annual Shareholders' Meeting were as follows:
(1) The separate tabulation of the votes for each Director
elected is as follows, with no abstentions, or broker
non-votes:
Director Nominee Votes For Votes Against
--------------------- --------- -------------
Donald M. Earhart 9,896,379 45,939
Jack H. Halperin 9,896,379 45,939
Dr. John H. Abeles 9,896,379 45,939
Erik H. Loudon 9,896,379 45,939
Dr. Henry T. Tai 9,896,379 45,939
Charles C. McGettigan 9,896,379 45,939
Joel S. Kanter 9,896,379 45,939
(2) A total of 4,566,318 votes were cast for the approval
of the adoption of the 1996 Stock Incentive Plan, with the
maximum number of shares of common stock to be awarded
under this plan to be 2,500,000. There were 1,003,513
votes cast against the approval of the plan, with the
4,301,981 shares unvoted and 70,506 votes being abstained.
(3) A total of 9,166,674 votes were cast for the approval
of the amendment to the Company's Bylaws to increase the
number of directors of the Company to eleven. There were
377,957 votes cast against the approval of this amendment,
with 325,502 shares unvoted, and 72,185 votes being
abstained.
Item 5. Not applicable
11
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - The list of exhibits contained in the accompanying
Index to Exhibits is herein incorporated by reference.
(b) During the quarter ended June 30, 1996, the Company filed no
Current Reports on Form 8-K.
12
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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.
I-FLOW CORPORATION
(Registrant)
Date: August 12, 1996 Donald M. Earhart /s/
---------------------------------
Donald M. Earhart,
Chairman, President and CEO
Date: August 12, 1996 Gayle L. Arnold /s/
---------------------------------
Gayle L. Arnold,
Vice President, Finance
13
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INDEX TO EXHIBITS
Set forth below is a list of the exhibits included as part of this report:
Exhibit No. Exhibit
- ----------- ---------
3.1(2) Restated Articles of Incorporation
of the Company
3.2(3) Certificate of Amendment to Restated
Articles of Incorporation dated June 14, 1991
3.3(5) Certificate of Amendment to Restated
Articles of Incorporation dated May 12, 1992
3.4(5) Certificate of Determination covering Company's Series B Preferred
Stock filed with the Secretary of State on October 5, 1992
3.5(3) Restated Bylaws as of July 22, 1991 of the Company
3.6 Amended Bylaws as of May 17, 1996 of the Company
4.1(5) Specimen Common Stock Certificate
4.2(1) Form of Redeemable Common Stock Purchase
Warrant of the Company ("IPO Warrant")
4.3(5) Certificates of Adjustment to IPO Warrants, dated
May 11, 1992, July 17, 1992 and October 5, 1992
4.4(1) Warrant Agreement between the Company
and American Stock Transfer & Trust Company,
as Warrant Agent, dated February 13, 1990
4.5(1) Forms of Warrant (Class A, B and C) dated
February 13, 1990 granted upon conversion of
9% convertible debentures issued in September
and October 1989 (the "Debenture Warrants")
4.6(1) Warrant Purchase Agreement between the
Company and M.H. Meyerson & Co., Inc., dated
February 13, 1990 (the "Underwriter Warrants)
4.7(5) Certificates of Adjustment to Underwriter Warrants, dated
May 11, 1992, July 17, 1992 and October 5, 1992
4.8(4) Form of Warrant (Class D) dated March 18, 1991
included in units sold in 1991 private placement
4.9(6) Form of Warrant (Class E) dated June 30, 1992
included in units sold in 1992 private placement
4.10(6) Form of Warrant (Class F) dated October 5, 1992
included in units sold in 1992 private placement of
Preferred Stock
4.11(7) Form of Warrant (Class G) dated December 17, 1993
included in units sold in 1993 private placement
14
<PAGE>
4.12(7) Certificate of Adjustment to IPO Warrants, dated
December 17, 1993
4.13(7) Certificate of Adjustment to Underwriter Warrants, dated
December 17, 1993
4.14(8) Form of Warrant (Class H) dated June 3, 1994, issued in
conjunction with a consulting agreement
10.1(2)(9) Employment Agreement with Donald M. Earhart
dated May 16, 1990
10.3(5)(9) 1987-1988 Incentive Stock Option Plan and
Non-Statutory Stock Option Plan Restated as
of March 23, 1992
10.4(4)(9) 1992 Non-Employee Director Stock Option Plan
10.5(10) License and Transfer Agreement with SoloPak Pharmaceuticals Inc.,
dated March 6, 1996
10.6(11) Agreement for Purchase and Sales of Assets dates as of July 3,
1996 By and Among I-Flow Corporation, Block Medical, Inc. and
Hillenbrand Industries, Inc.
27 Financial Data Schedule
(1) Incorporated by reference to exhibit with this title filed with the
Company's Registration Statement (#33-32263-LA) declared effective
February 1, 1990.
(2) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended September 30, 1990.
(3) Incorporated by reference to exhibit with this title filed with the
Company's Registration Statement (#33-41207-LA) declared effective
August 8, 1991.
(4) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended December 31, 1991.
(5) Incorporated by reference to exhibit with this title filed with the
Company's Post Effective Amendment to its Registration Statement
(#33-41207-LA) declared effective November 6, 1992.
(6) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended December 31, 1992.
(7) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended December 31, 1993.
(8) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended December 31, 1994.
(9) Management contract or compensatory plan or arrangement required to be
filed as an exhibit pursuant to applicable rules of the Securities and
Exchange Commission.
(10) Incorporated by reference to exhibit with this title filed with the
Company's Form 10-K for its fiscal year ended December 31, 1995.
(11) Incorporated by reference to exhibit with this title filed with the
Company's Form 8K dated July 22, 1996
15
<PAGE>
EXHIBIT 3.6
AMENDMENT
TO
BY-LAWS
OF
I-FLOW CORPORATION
The Board of Directors of I-Flow Corporation at a meeting on February 8,
1996 adopted a resolution approving and recommending to the shareholders for
their adoption at the Annual Meeting on May 17, 1996, an amendment to the
By-Laws of I-Flow Corporation, Restated as of July 22, 1991, to reflect the
following changes to the first two sentences of Section 3, Article II of the
By-Laws as Restated to read in their entirety as follows:
"Section 3. NUMBER AND QUALIFICATION OF DIRECTORS. The authorized number
of Directors of the Corporation shall not be less than six (6) nor more than
eleven (11). The exact number of authorized Directors shall be eight (8)
until changed, within the limits specified above, by a bylaw amending this
Section 3, duly adopted by the Board of Directors or by the Shareholders."
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment
this 17th day of May 1996.
/s/ Henry T. Tai
----------------------------------------
Henry T. Tai, M.D.,
Secretary
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> APR-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 10,443
<SECURITIES> 0
<RECEIVABLES> 1,109
<ALLOWANCES> 0
<INVENTORY> 1,517
<CURRENT-ASSETS> 13,198
<PP&E> 1,898
<DEPRECIATION> 1,275
<TOTAL-ASSETS> 14,253
<CURRENT-LIABILITIES> 1,383
<BONDS> 0
0
1,494
<COMMON> 28,326
<OTHER-SE> (16,950)
<TOTAL-LIABILITY-AND-EQUITY> 12,870
<SALES> 1,107
<TOTAL-REVENUES> 2,409
<CGS> 536
<TOTAL-COSTS> 1,858
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 551
<INCOME-TAX> 0
<INCOME-CONTINUING> 551
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 551
<EPS-PRIMARY> .05
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