<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, 2000
[ ] 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
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(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
California 33-0121984
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
20202 Windrow Drive, Lake Forest, CA 92630
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(Address of principal executive offices) (Zip Code)
(949) 206-2700
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(Registrant's telephone number, including area code)
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(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
As of November 10, 2000 there were 15,053,430 shares outstanding of
common stock.
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I-FLOW CORPORATION
FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2000
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Part I: Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets as of September 30, 2000 (Unaudited)
and December 31, 1999 3
Consolidated Statements of Operations for the three and nine-month
periods ended September 30, 2000 and 1999 (Unaudited) 4
Consolidated Statements of Cash Flows for the nine-month periods
ended September 30, 2000 and 1999 (Unaudited) 5
Notes to Consolidated Financial Statements (Unaudited) 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 9
Item 3. Quantitative and Qualitative Disclosures About Market Risk 11
Part II: Other Information
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 14
</TABLE>
<PAGE> 3
I-FLOW CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
------------ ------------
ASSETS (Unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 2,047,000 $ 3,192,000
Accounts receivable, net 10,210,000 8,748,000
Inventories, net 4,131,000 3,785,000
Prepaid expenses and other 632,000 553,000
Deferred taxes 2,837,000 2,837,000
------------ ------------
Total current assets 19,857,000 19,115,000
------------ ------------
Property, net 4,054,000 2,985,000
Goodwill and other intangibles, net 6,851,000 5,846,000
Notes receivable and other 893,000 782,000
Deferred taxes 3,040,000 3,040,000
------------ ------------
TOTAL $ 34,695,000 $ 31,768,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,205,000 $ 1,800,000
Accrued payroll and related expenses 1,296,000 1,526,000
Income taxes payable 1,182,000 607,000
Current portion of long-term debt 1,533,000 1,443,000
Borrowings under line-of-credit 616,000 88,000
Other liabilities 52,000 86,000
------------ ------------
Total current liabilities 6,884,000 5,550,000
------------ ------------
LONG-TERM DEBT 970,000 1,548,000
SHAREHOLDERS' EQUITY:
Preferred stock - no par value; 5,000,000 shares
authorized; no shares issued and outstanding at
September 30, 2000 (unaudited) and December 31, 1999, -- --
respectively
Common stock - no par value; 40,000,000 shares authorized; 15,051,766 and
14,692,125 shares issued and outstanding at September 30, 2000 (unaudited)
and December 31, 1999, respectively 40,623,000 39,414,000
Common stock warrants 615,000 615,000
Accumulated other comprehensive income 47,000 26,000
Accumulated deficit (14,444,000) (15,385,000)
------------ ------------
Net shareholders' equity 26,841,000 24,670,000
------------ ------------
TOTAL $ 34,695,000 $ 31,768,000
============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 4
I-FLOW CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
---------------------------- ----------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues:
Net product sales $ 7,371,000 $ 7,231,000 $22,578,000 $19,987,000
Licensing fees -- 600,000 -- 1,400,000
----------- ----------- ----------- -----------
Net revenues 7,371,000 7,831,000 22,578,000 21,387,000
Costs and expenses:
Cost of sales 3,311,000 3,057,000 9,726,000 8,380,000
Selling and marketing 1,321,000 1,011,000 3,891,000 3,141,000
General and administrative 1,973,000 2,248,000 6,302,000 6,069,000
Product development 285,000 275,000 904,000 801,000
----------- ----------- ----------- -----------
Total costs and expenses 6,890,000 6,591,000 20,823,000 18,391,000
Operating income 481,000 1,240,000 1,755,000 2,996,000
Interest expense, net 47,000 115,000 164,000 364,000
Income taxes 176,000 29,000 650,000 86,000
----------- ----------- ----------- -----------
Net income $ 258,000 $ 1,096,000 $ 941,000 $ 2,546,000
=========== =========== =========== ===========
Net income per share
Basic $ 0.02 $ 0.08 $ 0.06 $ 0.18
=========== =========== =========== ===========
Diluted $ 0.02 $ 0.07 $ 0.06 $ 0.17
=========== =========== =========== ===========
Comprehensive Operations:
Net income $ 258,000 $ 1,096,000 $ 941,000 $ 2,546,000
Foreign currency translation adjustment 30,000 12,000 21,000 12,000
----------- ----------- ----------- -----------
Comprehensive income $ 288,000 $ 1,108,000 $ 962,000 $ 2,558,000
=========== =========== =========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE> 5
I-FLOW CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------------------
2000 1999
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 941,000 $ 2,546,000
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 1,949,000 1,812,000
Compensation expense for stock option grants 60,000 42,000
Change in allowance for doubtful accounts 194,000 (100,000)
Change in inventory obsolescence reserve (353,000) 299,000
Changes in operating assets and liabilities:
Accounts receivable (1,457,000) (928,000)
Inventories (65,000) (460,000)
Prepaid expenses and other 26,000 (6,000)
Accounts payable, accrued and other liabilities 474,000 695,000
----------- -----------
Net cash provided by operating activities 1,769,000 3,900,000
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property acquisitions (1,985,000) (825,000)
Cash paid for acquisition (853,000) --
Change in other assets (454,000) (446,000)
----------- -----------
Net cash used in investing activities (3,292,000) (1,271,000)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds (repayments) from line of credit 527,000 (1,719,000)
Borrowings on notes payable 859,000 356,000
Payments on notes payable (1,427,000) (1,643,000)
Proceeds from exercise of stock options and warrants 400,000 203,000
----------- -----------
Net cash provided by (used in) financing activities 359,000 (2,803,000)
----------- -----------
Effect of exchange rates on cash 19,000 12,000
NET DECREASE IN CASH AND CASH EQUIVALENTS (1,145,000) (162,000)
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 3,192,000 971,000
----------- -----------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 2,047,000 $ 809,000
=========== ===========
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid $ 181,000 $ 364,000
----------- -----------
Income tax payments $ 195,000 $ 86,000
----------- -----------
Conversion of preferred stock to common stock $ -- $ 662,000
Liabilities issued and assumed in connection with acquisition:
Fair value of assets acquired (including intangibles) $ 1,911,000
Cash outflows for business acquisition (853,000)
Common stock issued (750,000)
-----------
Liabilities issued and assumed $ 308,000
===========
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE> 6
I-FLOW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements contain all
adjustments (consisting only of normal recurring adjustments) that, in
the opinion of management, are necessary to present fairly the financial
position of I-Flow Corporation (the "Company") at September 30, 2000 and
the results of its operations and its cash flows for the three and
nine-month periods ended September 30, 2000 and 1999. 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, 1999 filed
with the Securities and Exchange Commission on March 30, 2000.
Certain amounts previously reported have been reclassified to conform
with the presentation at September 30, 2000.
2. INVENTORIES
Inventories consisted of the following as of September 30, 2000 and
December 31, 1999:
<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
---- ----
<S> <C> <C>
Raw Materials $ 4,008,000 $ 3,581,000
Work in Process 362,000 164,000
Finished Goods 1,076,000 1,708,000
Reserve for Obsolescence (1,315,000) (1,668,000)
---------- ----------
Total $ 4,131,000 $ 3,785,000
---------- ----------
</TABLE>
3. EARNINGS PER SHARE
Basic net income per share is computed using the weighted average number
of common shares outstanding during the periods presented.
Diluted net income per share is computed using the weighted average
number of common and common equivalent shares outstanding during the
periods presented assuming the exercise of "all in-the-money" stock
options and warrants. Common equivalent shares have not been included
where inclusion would be antidilutive.
6
<PAGE> 7
The following is a reconciliation between the number of shares used in
the basic and diluted net income per share calculations:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- --------------------
(Amounts in thousands) 2000 1999 2000 1999
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net income $ 258 $ 1,096 $ 941 $ 2,546
Basic net income per share
Weighted average number of shares outstanding 15,039 14,442 14,981 14,298
Effect of dilutive securities:
Stock options 585 1,324 738 1,008
------- ------- ------- -------
Diluted net income per share
Weighted average number of shares outstanding 15,624 15,766 15,719 15,306
------- ------- ------- -------
</TABLE>
4. BUSINESS SEGMENTS
The Company operates in two business segments: manufacturing and
marketing of medical infusion products and rentals of medical infusion
pumps.
Business segment information is as follows for the three and nine-month
periods ended September 30, 2000 and 1999:
<TABLE>
<CAPTION>
Manufacturing
(Amounts in thousands) and Marketing Rentals Consolidated
---------------------- ------------- ------- ------------
<S> <C> <C> <C>
THREE MONTHS ENDED SEPTEMBER 30, 2000
Revenues 5,240 2,131 7,371
Operating income (loss) (15) 496 481
Assets 23,495 11,200 34,695
NINE MONTHS ENDED SEPTEMBER 30, 2000
Revenues 16,212 6,366 22,578
Operating income 496 1,259 1,755
Assets 23,495 11,200 34,695
THREE MONTHS ENDED SEPTEMBER 30, 1999
Revenues 5,788 2,043 7,831
Operating income 814 426 1,240
Assets 15,852 8,976 24,828
NINE MONTHS ENDED SEPTEMBER 30, 1999
Revenues 15,228 6,159 21,387
Operating income 1,639 1,357 2,996
Assets 15,852 8,976 24,828
</TABLE>
7
<PAGE> 8
5. ACQUISITION OF SPINAL SPECIALTIES, INC.
On January 14, 2000, the Company acquired Spinal Specialties, Inc., a
designer and manufacturer of custom spinal, epidural and nerve block
infusion kits based in San Antonio, Texas, for $1.5 million. The
purchase price consisted of $750,000 in cash and 200,000 shares of
I-Flow common stock plus direct costs of $103,000. The acquisition was
accounted for under the purchase method of accounting and the purchase
price has been allocated to the net assets acquired and goodwill.
6. NEW ACCOUNTING PRONOUNCEMENTS
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin "SAB" 101, "Revenue Recognition in Financial
Statements." Implementation of SAB 101, which was delayed by the
issuance of SAB 101A on March 27, 2000 and SAB 101B on June 26, 2000 is
required by the fourth quarter of 2000. The Company is currently in the
process of evaluating the impact, if any, SAB 101 will have on its
consolidated financial position or results of operations.
In June 1998, the FASB issued Statement of Financial Accounting
Standards (SFAS) No. 133, "Accounting for Derivative Instruments and
Hedging Activities." SFAS No. 133 establishes new accounting and
reporting standards for derivative instruments and for hedging
activities. SFAS No. 133 requires the Company to measure all derivatives
at fair value and to recognize them in the balance sheet as an asset or
liability, depending on the Company's rights or obligations under the
applicable derivative contract. The Company will adopt SFAS 133 no later
than the first quarter of fiscal year 2001. Adoption of the new method
of accounting for derivatives and hedging activities is not expected to
have a material impact of the Company's financial position.
In March 2000, the FASB issued Interpretation No. 44 (FIN 44),
"Accounting for Certain Transactions involving Stock Compensation." FIN
44 is an interpretation of Accounting Principal Board's Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25). Among other
matters, FIN 44 clarifies the application of APB 25 regarding the
definition of an employee for purposes of applying APB 25, the criteria
for determining whether a plan qualifies as noncompensatory and the
accounting consequences to the terms of a previously issued stock
options or similar awards. The Company adopted the provisions of FIN 44
in the third quarter of 2000. The adoption of FIN 44 did not have a
material impact of the Company's financial condition or results of
operations.
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Certain disclosures made by the Company in this report and in other
reports and statements released by the Company are and will be
forward-looking in nature, such as comments that express the Company's
opinions about trends and factors that may impact future operating
results. Disclosures that use words such as the Company "believes,"
"anticipates," or "expects" or use similar expressions are intended to
identify forward-looking statements. Such statements are subject to
certain risks and uncertainties that could cause actual results to
differ from those expected. Readers are cautioned not to place undue
reliance on these forward-looking statements. The Company undertakes no
obligation to publish 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 that seek to advise interested parties of the risks and other
factors that affect the Company's business, as well as in the Company's
periodic reports on Forms 10-K, 10-Q, and 8-K filed with the Securities
and Exchange Commission. The risks affecting the Company's business
include reliance on the clinical and commercial acceptance of the
Company's products, the ability to penetrate hospital accounts, the
health care reimbursement system in place now and in the future,
competition in the industry, demand in foreign countries, customer
credit risks, technological changes and product availability. Any such
forward-looking statements, whether made in this report or elsewhere,
should be considered in context with the various disclosures made by the
Company about its business.
RESULTS OF OPERATIONS
Net revenues during the three and nine-month periods ended September 30,
2000 were $7,371,000 and $22,578,000 compared to $7,831,000 and
$21,387,000 for the same periods in the prior year, representing a
decrease of 6% and an increase of 6%, respectively.
Net product sales increased from $19,987,000 for the nine months ended
September 30, 1999 to $22,578,000 for the same period in 2000, an
increase of 13%. In January 2000, the Company acquired a new subsidiary,
Spinal Specialties, Inc., a designer and manufacturer of custom spinal,
epidural and nerve block infusion kits based in San Antonio, Texas
("Spinal Specialties"). Product sales generated by Spinal Specialties of
$465,000 and $1,377,000 were included in product sales for the three and
nine-month periods ended September 30, 2000. The remaining increase in
product sales, year to date, is primarily due to increased sales to
major distributors.
The Company incurred cost of sales of $3,311,000 and $9,726,000 during
the three and nine-month periods ended September 30, 2000, compared to
$3,057,000 and $8,380,000 in the prior year. As a percentage of net
product sales, cost of sales was relatively unchanged compared to the
same periods in the prior year.
Selling and marketing expenses for the three and nine-month periods
ended September 30, 2000 increased over the same periods in the prior
year by $310,000 or 31% and $750,000 or 24%, respectively. The increase
is due in significant part to the addition of $146,000 and $360,000 in
selling expenses for Spinal Specialties for the three and nine-month
periods ended September 30, 2000, and partly due to increased sales
compensation and outside sales commissions. For the three and nine-month
periods ended September 30, 2000 selling and marketing expenses as a
percent of net product sales increased by 4% and 2%, respectively.
General and administrative expenses decreased for the three months ended
September 30, 2000 by $275,000 or 12% and increased year to date by
$233,000 or 4% from the same periods in the prior year. The increase
year to date is due primarily to the addition of the Spinal Specialties
operation. For the three and nine-month periods ended September 30, 2000
general and administrative expenses as a percent of net product sales
decreased by 4% and 1%, respectively. The decrease for the three-month
period ended September 30, 2000 was due to a reduction in total
compensation.
9
<PAGE> 10
Product development expenses for the three and nine-months ended
September 30, 2000 increased $10,000 or 4% and $103,000 or 13% over the
same periods in the prior year, due primarily to increased efforts on
the new pain management products. The Company will continue to incur
product development expenses as it continues its efforts to introduce
new and improved technology and cost-efficient products into the market.
LIQUIDITY AND CAPITAL RESOURCES
During the nine-month period ended September 30, 2000, funds of
$1,769,000 were provided by operating activities consisting of net
income of $941,000 plus non-cash expenses of $1,850,000 less net changes
in operating assets and liabilities of $1,022,000. These changes in
operating assets and liabilities consisted of: (1) an increase in
accounts receivable of $1,457,000, (2) an increase in inventories of
$65,000, (3) a decrease in prepaid expenses and other of $26,000, plus
(4) an increase in accounts payable, accrued expenses, and other
liabilities of $474,000. The increase in accounts receivable is
substantially attributable to slower collection of Medicare receivables
by the Company's InfuSystem subsidiary. Steps have been taken which
management believes will improve the timeliness of these collections.
The Company used funds for investing activities during the nine-month
period ended September 30, 2000 aggregating $3,319,000. These
expenditures consisted of $1,985,000 for acquiring furniture, fixtures
and equipment for use in its operations and an increase in other assets
of $454,000. Additionally, in January 2000, the Company used $853,000 in
connection with the acquisition of Spinal Specialties (see Note 5 of
Notes to Consolidated Financial Statements).
During the nine-month period ended September 30, 2000, funds of $359,000
were provided by financing activities consisting of $527,000 net
proceeds from line of credit, $859,000 additional borrowings on notes
payable less payments on notes payable of $1,427,000 (including $80,000
notes payable assumed through the acquisition of Spinal Specialties),
and $400,000 in proceeds from the exercise of stock options and
warrants.
As of September 30, 2000, the Company had cash and cash equivalents of
$2,047,000 and net receivables of $10,210,000. Management believes the
Company's funds are sufficient to provide for its projected needs for
operations for the next twelve months. However, the Company may decide
to sell additional equity or increase its borrowings in order to fund
increased product development or for other purposes.
NEW ACCOUNTING PRONOUNCEMENTS
In December 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin "SAB" 101, "Revenue Recognition in Financial
Statements." Implementation of SAB 101, which was delayed by the
issuance of SAB 101A on March 27, 2000 and SAB 101B on June 26, 2000 is
required by the fourth quarter of 2000. The Company is currently in the
process of evaluating the impact, if any, SAB 101 will have on its
consolidated financial position or results of operations.
In June 1998, the FASB issued Statement of Financial Accounting
Standards (SFAS) No. 133, "Accounting for Derivative Instruments and
Hedging Activities." SFAS No. 133 establishes new accounting and
reporting standards for derivative instruments and for hedging
activities. SFAS No. 133 requires the Company to measure all derivatives
at fair value and to recognize them in the balance sheet as an asset or
liability, depending on the Company's rights or obligations under the
applicable derivative contract. The Company will adopt SFAS 133 no later
than the first quarter of fiscal year 2001. Adoption of the new method
of accounting for derivatives and hedging activities is not expected to
have a material impact of the Company's financial position.
In March 2000, the FASB issued Interpretation No. 44 (FIN 44),
"Accounting for Certain Transactions involving Stock Compensation." FIN
44 is an interpretation of Accounting Principal Board's Opinion No. 25,
"Accounting for Stock Issued to Employees" (APB 25). Among other
matters, FIN 44 clarifies the application of APB 25 regarding the
definition of an employee for purposes of applying APB 25, the criteria
for determining whether a plan qualifies as noncompensatory and the
accounting consequences to
10
<PAGE> 11
the terms of a previously issued stock options or similar awards. The
Company adopted the provisions of FIN 44 in the third quarter of 2000.
The adoption of FIN 44 did not have a material impact of the Company's
financial condition or results of operations.
YEAR 2000 COMPLIANCE
The Company did not experience any significant malfunctions or errors in
its operating or business systems when the date changed from 1999 to
2000. Based on operations since January 1, 2000, the Company does not
expect any significant impact to its ongoing business as a result of the
"Year 2000 issue." However, it is possible that the full impact of the
date change, which was of concern due to computer programs that use two
digits instead of four digits to define years, has not been fully
recognized. For example, it is possible that Year 2000 or similar issues
such as leap year-related problems may occur with billing, payroll, or
financial closings at month, quarter or year-end. The Company believes
that any such problems are likely to be minor and correctable. In
addition, the Company could still be negatively affected if the Year
2000 or similar issues adversely affect its customers or suppliers. The
Company currently is not aware of any significant Year 2000 or similar
problems that have arisen for its customers and suppliers.
The Company expended less then $150,000 on Year 2000 readiness efforts
from 1998 to 1999. These efforts included replacing some outdated,
noncompliant hardware and noncompliant software as well as identifying
and remediating potential Year 2000 problems.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
FOREIGN CURRENCY
The Company has a subsidiary operating in Mexico. Accordingly, the
Company is exposed to transaction gains and losses that could result
from changes in foreign currency exchange rates. The Company does not
believe that this foreign currency market risk is material.
11
<PAGE> 12
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit No. Exhibit
----------- -------
<S> <C>
3.1 Restated Articles of Incorporation of the Company (2)
3.2 Certificate of Amendment to Restated Articles of Incorporation
dated June 14, 1991 (3)
3.3 Certificate of Amendment to Restated Articles of Incorporation
dated May 12, 1992 (4)
3.4 Certificate of Determination covering Company's Series B
Preferred Stock filed with the Secretary of State on October 5,
1992 (4)
3.5 Restated Bylaws as of July 22, 1991 of the Company (3)
4.1 Specimen Common Stock Certificate (4)
4.2 Warrant Agreement between the Company and American Stock
Transfer & Trust Company, as Warrant Agent, dated February 13,
1990 (1)
4.3 Form of Warrant dated July 22, 1996, issued in conjunction with
The acquisition of Block Medical, Inc. (5)
10.1 Employment Agreement with Donald M. Earhart dated May 16, 1990
(2)(6)
10.2 1987-1988 Incentive Stock Option Plan and Non-Statutory Stock
Option Plan Restated as of March 23, 1992 (5)(6)
10.3 1992 Non-Employee Director Stock Option Plan (4)(6)
10.4 License and Transfer Agreement with SoloPak Pharmaceuticals
Inc., dated March 6, 1996 (7)
10.5 1996 Stock Incentive Plan (6)(9)
10.6 Agreement for Purchase and Sale of Assets dated as of July 3,
1996 by and among I-Flow Corporation, Block Medical, Inc. and
Hillenbrand Industries, Inc. (8)
10.7 Employment Agreement with James J. Dal Porto dated September 6,
1996 (10)(6)
10.8 Lease Agreement between Industrial Developments International,
Inc. as Landlord and I-Flow Corporation as Tenant dated April
14, 1997 (11)
10.9 Agreement and Plan of Merger by and among I-Flow Corporation,
I-Flow Subsidiary, Inc., Venture Medical, Inc., and InfuSystems
II, Inc. and the Shareholders of Venture Medical, Inc. and
InfuSystems II, Inc. (12)
10.10 Loan and Security Agreement between Silicon Valley Bank and
I-Flow Corporation dated September 28, 1995 (13)
10.11 Amendment to Loan Agreement between Silicon Valley Bank and
I-Flow Corporation dated March 2, 1999 (13)
10.12 Agreement and Plan of Merger by and Among I-Flow Corporation,
Spinal Acquisition Corp., Spinal Specialties, Inc. and the
Shareholders of Spinal Specialties, Inc. dated January 13, 2000
(14)
27 Financial Data Schedule
</TABLE>
(1) Incorporated by reference to exhibit with this title filed with
the Company's Registration Statement (#33-32263-LA) declared
effective February 1, 1990.
12
<PAGE> 13
(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) Management contract or compensatory plan or arrangement required
to be filed as an exhibit pursuant to applicable rules of the
Securities and Exchange Commission.
(7) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1995.
(8) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated July 22, 1996.
(9) Incorporated by reference to exhibit with this title filed with
the Company's Registration Statement (#333-16547) declared
effective November 20, 1996.
(10) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1996.
(11) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated April 14, 1997.
(12) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated February 9, 1999.
(13) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1997.
(14) Incorporated by reference to exhibit with this title filed with
the Company's quarterly report on form 10-Q for the quarter
ended March 31, 2000.
(b) Reports on Form 8-K. The Company did not file any
Reports on Form 8-K during the quarter ended September
30, 2000.
13
<PAGE> 14
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.
Date November 14, 2000 /s/ Donald M. Earhart
-------------------- -----------------------------------------
Donald M. Earhart,
Chairman, President and CEO
(As Duly Authorized Officer)
Date November 14, 2000 /s/ James R. Talevich
-------------------- -----------------------------------------
James R. Talevich
Chief Financial Officer
(As Principal Financial Officer)
14
<PAGE> 15
INDEX TO EXHIBITS
Set forth below is a list of the exhibits included or incorporated by
reference as part of this report:
<TABLE>
<CAPTION>
Exhibit No. Exhibit
----------- -------
<S> <C>
3.1 Restated Articles of Incorporation of the Company (2)
3.2 Certificate of Amendment to Restated Articles of Incorporation
dated June 14, 1991 (3)
3.3 Certificate of Amendment to Restated Articles of Incorporation
dated May 12, 1992 (4)
3.4 Certificate of Determination covering Company's Series B
Preferred Stock filed with the Secretary of State on October 5,
1992 (4)
3.5 Restated Bylaws as of July 22, 1991 of the Company (3)
4.1 Specimen Common Stock Certificate (5)
4.2 Warrant Agreement between the Company and American Stock
Transfer & Trust Company, as Warrant Agent, dated February 13,
1990 (1)
4.3 Form of Warrant dated July 22, 1996, issued in conjunction with
the acquisition of Block Medical, Inc. (8)
10.1 Employment Agreement with Donald M. Earhart dated May 16, 1990
(2)(6)
10.2 1987-1988 Incentive Stock Option Plan and Non-Statutory Stock
Option Plan Restated as of March 23, 1992 (5)(6)
10.3 1992 Non-Employee Director Stock Option Plan (4)(6)
10.4 License and Transfer Agreement with SoloPak Pharmaceuticals
Inc., dated March 6, 1996 (7)
10.5 1996 Stock Incentive Plan (6)(9)
10.6 Agreement for Purchase and Sale of Assets dated as of July 3,
1996 by and among I-Flow Corporation, Block Medical, Inc. and
Hillenbrand Industries, Inc. (8)
10.7 Employment Agreement with James J. Dal Porto dated September 6,
1996 (10)(6)
10.8 Lease Agreement Between Industrial Developments International,
Inc. as Landlord and I-Flow Corporation as Tenant dated April
14, 1997 (11)
10.9 Agreement and Plan of Merger by and among I-Flow Corporation,
I-Flow Subsidiary, Inc., Venture Medical, Inc., and InfuSystems
II, Inc. and the Shareholders of Venture Medical, Inc. and
InfuSystems II, Inc. (12)
10.10 Loan and Security Agreement between Silicon Valley Bank and
I-Flow Corporation dated September 28, 1995 (13)
10.11 Amendment to Loan Agreement between Silicon Valley Bank and
I-Flow Corporation dated March 2, 1999 (13)
10.12 Agreement and Plan of Merger by and among I-Flow Corporation,
Spinal Acquisition Corp. and Spinal Specialties, Inc. dated
January 13, 2000 (14)
27 Financial Data Schedule
</TABLE>
(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.
15
<PAGE> 16
(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) Management contract or compensatory plan or arrangement required
to be filed as an exhibit pursuant to applicable rules of the
Securities and Exchange Commission.
(7) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1995.
(8) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated July 22, 1996.
(9) Incorporated by reference to exhibit with this title filed with
the Company's Registration Statement (#333-16547) declared
effective November 20, 1996.
(10) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1996.
(11) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated April 14, 1997.
(12) Incorporated by reference to exhibit with this title filed with
the Company's Report on Form 8-K dated February 9, 1999.
(13) Incorporated by reference to exhibit with this title filed with
the Company's Form 10-K for its fiscal year ended December 31,
1997.
(14) Incorporated by reference to exhibit with this title filed with
the Company's quarterly report on Form 10-Q for the quarter
ended March 31, 2000.
16
