<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 ACT OF
1934
For the quarterly period ended June 30, 1996
-------------------------------------------------
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF
1934
For the transition period from to
---------------------- -------------------------
Commission File Number: 0-19606
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AMERICAN BIOMED, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Delaware 76-0136574
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(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number)
</TABLE>
10077 Grogan's Mill Road, Suite 100, The Woodlands, Texas 77380
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(address of principal executive offices) (Zip Code)
(713) 367-3895
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(Registrant's telephone number, including area code)
N.A.
- --------------------------------------------------------------------------------
(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 and 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
The total number of shares outstanding of common stock, $.001 par value as of
July 24, 1996 is 11,716,452.
<PAGE> 2
AMERICAN BIOMED, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
<TABLE>
<CAPTION>
Page
<S> <C>
Item 1 - Financial Statements
Consolidated Condensed Balance Sheets 3
Consolidated Condensed Statements of Operations 4
Consolidated Condensed Statements of Cash Flows 5
Notes to Consolidated Condensed Financial Statements 6-9
Item 2 - Management's Discussion and
Analysis of Financial Condition
and Results of Operations 10-12
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 13
Item 5 Other Information 13
Item 6 Exhibits and Reports on Form 8-K 14
SIGNATURES 15
INDEX TO EXHIBITS 16
</TABLE>
2
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 807,190 $ 9,177
Accounts receivable:
Trade, net of allowance for doubtful accounts
of $45,480 and $45,000 in 1995 and 1996 respectively 137,105 158,713
Other 27,576 32,064
Inventories 421,478 370,130
Other current assets 405,438 60,667
---------- -----------
Total current assets 1,798,787 630,751
---------- -----------
Property and equipment, net 139,456 200,736
Patents, net of accumulated amortization of $799,043
and $844,037 in 1995 and 1996, respectively 168,553 204,812
Goodwill, net of accumulated amortization of $451,308
and $528,171 in 1995 and 1996, respectively 743,527 779,528
Other assets, net of accumulated amortization of $175,000
in 1995 and 1996, respectively 107,826 67,451
----------- ----------
Total assets $ 2,958,149 $1,883,278
========== ==========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable, banks $ 230,000 $ 235,000
Notes payable to stockholders and others 1,632,880 1,831,322
Current maturities of capital lease obligations 224,338 512,712
Current maturities, long term debt 28,640 --
Accounts payable 1,036,783 1,283,020
Accrued liabilities 656,776 595,984
Other current liabilities 3,000 --
- ----------- ----------
Total current liabilities 3,812,417 4,458,038
----------- ----------
Long term debt, net of current maturities 128,623 --
Capital lease obligations, net of current maturities 429,788 7,095
Deferred revenue 190,000 220,000
Commitments and contingencies:
Stockholders' deficit:
Preferred stock, $.001 par value, 2,000,000 shares authorized,
no shares issued and outstanding in 1995 and 1996, respectively
Common stock, $.001 par value, 25,000,000 shares authorized in 1995 and
1996, 9,505,274 shares and 11,781,275 shares issued and outstanding at
December 31, 1995 and June 30, 1996, respectively 11,781 9,505
Additional paid-in capital 21,614,442 19,190,146
Deficit accumulated during the development stage (22,977,302) (21,749,906)
Less treasury stock at cost, 68,323 shares (251,600) (251,600)
----------- -----------
Total stockholders' deficit (1,602,679) (2,801,855)
----------- -----------
Total liabilities and stockholders' deficit $ 2,958,149 $ 1,883,278
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 4
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Inception,
Three Months Ended Six Months Ended September 4, 1984,
June 30, June 30, to
1996 1995 1996 1995 June 30, 1996
-------------------------- --------------------------- --------------
<S> <C> <C> <C> <C> <C>
Sales, net $ 122,699 $ 159,284 $ 229,436 $ 291,233 $ 2,964,550
Operating costs and expenses:
Cost of sales (105,660) (161,803) (206,473) (261,800) (3,018,541)
Selling, general and administrative (429,958) (901,496) (760,888) (1,297,063) (14,499,228)
Research and development (238,698) (165,658) (352,686) (313,342) (6,961,887)
Distributor settlement (1,080,915)
------------- ------------- ----------- ---------- -----------
Loss from operations (651,617) (1,069,673) (1,090,611) (1,580,972) (22,596,021)
---------- ----------- ---------- ---------- -----------
Other income (expense):
Interest income 208 3,570 691 3,574 106,173
Interest expense (127,037) (61,763) (197,683) (111,296) (2,579,207)
Other income (expense) 50,847 (30,116) 60,207 14,806 2,091,753
------------ ---------- ----------- ----------- --------------
Other income (expense), net (75,982) (88,309) (136,785) (92,916) (381,281)
----------- ---------- ----------- ---------- -------------
Net loss $ (727,599) $(1,157,982) $(1,227,396) $(1,673,888) $ (22,977,302)
============ =========== =========== =========== =============
Net loss per share $ (.07) $ (.13) $ (.12) $ (.18)
====== ====== =========== ===========
Weighted average number of shares outstanding 10,214,725 9,241,324 9,873,928 9,238,006
========== ========== =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE> 5
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Inception,
Six Months Ended September 4, 1984,
June 30, to
1996 1995 June 30, 1996
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<S> <C> <C>
Net cash used by operating activities $ (630,227) $(1,509,827) $(16,309,482)
------------ ----------- ------------
Cash flows from investing activities:
Capital expenditures (11,003) (399,456)
Investment in patents (8,735) (37,183) (414,309)
Other investing activities 243,816
--------------- ----------- ------------
Net cash used by investing activities (19,738) (37,183) (569,949)
--------------- ----------- ------------
Cash flows from financing activities:
Proceeds from notes payable to banks 2,333,880
Proceeds from notes payable to stockholders 34,750 1,225,921
Proceeds from notes payable to others 521,000 2,361,049
Escrow proceeds 2,000,000 --
Principal payments on notes payable to banks (5,000) (33,880) (2,070,000)
Principal payments on notes payable to stockholders (38,238) (574,970)
Principal payments on notes payable to others (194,954) (527,919) (1,415,301)
Principal payments on long-term debt (13,259) (76,340)
Principal payments on capital lease obligation (13,996) (141,604) (544,885)
Proceeds from patent assignment and leaseback 500,000
Proceeds from equipment assignment and leaseback 305,000
Proceeds from sale of subordinated
convertible debentures 640,000
Net proceeds from sale of preferred stock 3,046,146
Net proceeds from sale of common stock and warrants
in connection with initial public offering, secondary
offering and private placements 1,519,853 9,859,819
Proceeds from exercise of stock purchase warrants
and stock options 145,563 2,985,543
Treasury stock acquired (500,000)
Other financing activities (389,241)
------------- ----------- -----------
Net cash provided by financing activities 1,447,978 1,804,338 17,686,621
------------- ----------- -----------
Net increase in cash and cash equivalents 798,013 257,328 807,190
Cash and cash equivalents at beginning
of period 9,177 21,246
------------ ----------- -----------
Cash and cash equivalents at end of period $ 807,190 $ 278,574 $ 807,190
============ =========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements
5
<PAGE> 6
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated condensed financial statements have
been prepared in accordance with the requirements of Form 10-Q and therefore do
not include all information and footnotes necessary for a fair presentation of
financial position, results of operations and cash flows in conformity with
generally accepted accounting principles. In the opinion of management, the
unaudited consolidated condensed financial statements reflect all adjustments
that are necessary for a fair statement of the results of the periods
presented, and all such adjustments are of a normal recurring nature.
The unaudited consolidated condensed financial statements include the
accounts of American BioMed, Inc. and its wholly-owned subsidiaries, Freedom
Machine, Inc. and Cathlab Corporation, (jointly referred to as the "Company")
after elimination of all intercompany transactions and accounts. Certain
reclassifications have been made to prior year financial information in order
to conform to current year presentation.
These unaudited consolidated condensed financial statements should be read
in connection with the financial statements for the year ended December 31,
1995 included in the Company's Annual Report filed on Form 10-K. Results for
the period are not necessarily indicative of year-end results.
2. CAPITAL STOCK
On July 17, 1996, the Board of Directors approved the issuance of options to
purchase 10,000 shares of common stock at $.50 per share in connection with an
employment agreement. The Board also authorized issuance of options to
purchase 10,000 shares at $.50 per share to an employee. In connection with
his hiring as Vice President Sales and Marketing, Arthur Przybyl was granted
options to purchase 100,000 shares of common stock at $1.00 per share, or at
the closing price on April 15, 1996, whichever is lower.
The Company filed a Form S-8 Registration Statement ("Registration
Statement") on April 16, 1996. The Registration Statement relates to an
aggregate of 600,000 shares of the Company's common stock which are to be
offered upon the terms and subject to the conditions set forth in the
agreements referenced in the Registration Statement.
In lieu of interest on a stockholder note payable, the Company issued 30,000
shares of common stock.
On April 19, 1996, the Company issued 2,000 shares of common stock in
connection with a private placement.
In May 1996, the Company issued 198,000 shares of common stock to its
landlord in California to settle the outstanding lease obligation and to prepay
the lease for the remaining term.
In February 1996, the Company entered into a consulting agreement with
Zanett Capital, Inc. to raise equity capital through private placement of the
Company's common stock. Pursuant to these private placements, which were
finalized June 28, 1996, the Company issued 1,250,001 shares of common stock
and, during the third quarter of 1996, will issue convertible preferred shares.
In addition to the shares, warrants were issued, some of which expire monthly.
6
<PAGE> 7
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS - Continued
(Unaudited)
3. SUPPLEMENTAL INFORMATION FOR STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Inception,
Six Months Ended September 4, 1984
June 30, to
1996 1995 June 30, 1996
----------------------- -----------------
<S> <C> <C> <C>
Interest Paid $ 69,754 $ 88,615 $ 824,052
Noncash investing and financing activities:
Equipment acquired through
capital lease obligations 2,031 268,570
Equipment and leasehold improvements
acquired through notes payable 35,775
Conversion of accrued interest
payable to principal on note
payable to stockholders 105,170
Conversion of Series A and Series B
Preferred Stock to common stock 444
Conversion of debentures
to common stock 640,000
Deferred offering costs incurred
in prior year charged against
offering proceeds 41,000
Issuance of common stock in connection
with purchase of assets of VMS, Inc. 124,999
Issuance of common stock in connection
with purchase of assets of Superstat, Inc. 81,819
Conversion of notes payable to common stock 50,000
Common stock and warrants issued in lieu of
interest expense 16,875 1,346,036
Patent assignment and leaseback 500,000
Issuance of common stock in connection with
Therex settlement 77
Transfer of note receivable from officer 25,000
Writeup of property and equipment on Cathlab
due to sale and leaseback agreement 221,616
Issuance of common stock and warrants
for services 744,281 42,923 1,384,208
</TABLE>
7
<PAGE> 8
4. INVENTORIES
Inventories are stated at the lower of cost or market value. Cost
is determined using the first-in, first- out (FIFO) method.
Inventories consisted of the following:
<TABLE>
<CAPTION>
June 30 December 31
1996 1995
------------ -----------
<S> <C> <C>
Raw materials $ 164,055 $ 146,901
Work in process 161,463 166,893
Finished goods 95,960 56,336
--------- ---------
$ 421,478 $ 370,130
========= ==========
</TABLE>
5. COMMITMENTS AND CONTINGENCIES
In March 1996, Aberlyn agreed to discuss a restructuring of all
Company leases and an agreement to restructure the leases was reached May 28,
1996 with Board of Directors' approval received July 17, 1996. The
restructuring has resulted in lease payments over a twenty-four month period
with the initial payment commencing June 1, 1996. The payment schedule is as
follows:
<TABLE>
<S> <C>
Months 1-5 $ 15,000 (each)
Month 6 50,000
Months 7-11 15,000 (each)
Month 12 50,000
Months 13-17 15,000 (each)
Month 18 125,000
Months 19-23 25,000 (each)
Month 24 $ 215,000
</TABLE>
The above payments are based on outstanding principal of approximately
$514,000 and total accrued interest of approximately $148,000. Accumulated
late fees and additional accumulated miscellaneous expenses totaling $115,728
is being converted into 115,000 shares of the Company's common stock. The
price reflects a discount from the closing bid price of $1.125 per share on May
28, 1996.
In July 1995, United States Surgical Corporation ("USSC") elected not
to exercise its option to acquire certain assets. As a result, the Company
retained $1.0 million of the initial payment as a forfeited option fee. The
other $1.0 million is payable to USSC plus interest at 10% per year. The note,
originally due January 20, 1996 which is collateralized by the Company's stent
technology, was extended to March 15, 1996. On May 9, 1996, the Company and
USSC finalized negotiations to extend the note until September 15, 1996. The
agreement requires payments as follows:
May 22 - $50,000
June 15 - $75,000
July 15 - $75,000
Aug 15 - $75,000
Sep 15 - Remaining Balance
In June 1996, the Company executed an installment note payable to a
vendor in the amount of $157,263 payable in monthly installments of $3,858
including interest, beginning September 1, 1996 and maturing August 1, 2000.
The note bears interest at 8.25% per year and is uncollateralized.
8
<PAGE> 9
The Company is a party to litigation arising in the ordinary course of
business. Management regularly analyzes current information and, as necessary,
provides accrual for probable liabilities for the eventual disposition of the
matter. In the opinion of management, the ultimate outcome of these matters
will not materially affect the Company's financial position, results of
operations or cash flows.
Refer to the Company's report on Form 10-K for the year ended December
31, 1995 for a description of other legal proceedings to which the Company
became a party during the six (6) months ended June 30, 1996.
6. SUBSEQUENT EVENTS.
During the second quarter of 1996 management, in order to resolve
outstanding financial obligations, negotiated debt to equity conversions of
approximately $1.7 million with various stockholders, vendors and a bank in
July 1996 to be paid with the issuance of approximately 1,056,000 shares of
common stock.
The following is selected balance sheet information to show the effect
of the conversion as though it took place on June 30, 1996.
<TABLE>
<CAPTION>
Actual Proforma
June 30, 1996 June 30, 1996
------------- -------------
<S> <C> <C>
Current Assets $ 1,798,787 $ 1,798,787
=========== ===========
Current Liabilities $ 3,812,417 $ 2,112,417
=========== ===========
Stockholder Equity:
Common Stock $ 11,781 $ 12,837
Additional Paid-in Capital 21,614,442 23,313,386
Deficit (22,977,302) (22,977,302)
Less Treasury Stock (251,600) (251,600)
----------- -----------
Total stockholders equity $(1,602,679) $ 97,321
=========== ===========
</TABLE>
9
<PAGE> 10
AMERICAN BIOMED, INC. AND SUBSIDIARIES
(A Development Stage Enterprise)
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The Company is in the development stage and has had limited operating
revenues since its inception on September 4, 1984. From September 4, 1984
through June 30, 1996, the Company had an accumulated deficit of $22,977,302.
During the six months ended June 30, 1996, the Company's sales
decreased 21.2% to $229,436 compared with sales of $291,233 for the same period
in 1995. The primary reason for the decrease is attributed to unprofitable
product lines and delays encountered in product registrations in international
markets by the Company's newly appointed Cathlab international distributors.
As a result, international sales of Cathlab products declined 61.8% and 65.9%
for the quarter and six months, respectively, while domestic sales of Cathlab
products increased 903.0% and 481.5% for the quarter and six months,
respectively.
Cost of sales represented 89.9% and 90.0% of sales for the six months
ended June 30, 1995 and 1996, respectively.
Selling, general and administrative expenses decreased 41.3% to
$760,888 during the first six months of 1996, compared to $1,297,063 for the
same period in 1995. The decrease is due to several factors. The Company
subleased 3,000 square feet of the Cathlab facility to an unrelated party in
January 1996 and downsized the corporate headquarters and research and
development facility, resulting in savings of approximately $46,000 for the six
months ended June 30, 1996. Many of the assets have been fully amortized or
depreciated. The most significant difference was the legal expense and other
transaction costs incurred in the second quarter of 1995 related to the USSC
transaction.
Research and development expenses totaled $352,686 during the first
six months of 1996, an increase of 12.6% from the 1995 first six months total
of $313,342. The increase in research and development expenditures is
primarily attributed to the Company's efforts to initiate U.S. clinical trials
for the OmniCath(R).
The Company's interest expense totaled $127,037 for the second quarter
of 1996, compared to $61,763 for the second quarter of 1995. This increase was
primarily due to the July 20, 1995 note payable to a USSC which is
collateralized by the Company's stent technology.
Despite the decline in sales, the Company's continued emphasis on cost
containment and a focus on its core technologies resulted in the loss from
operations improving from $1,673,888 in 1995 to $1,227,396 in 1996,
representing a 26.7% improvement. In addition, net cash used by operating
activities in the six months ended June 30, 1996 improved 58.3% or $879,600
compared to the same period in 1995.
For the period from inception to June 30, 1996, the Company's other
income of $2,091,753 consisted primarily of $400,000 received from Guerbet in
1991 in connection with the development of certain of the Company's products,
proceeds of $49,900 received from the initial phase of a grant obtained from
the National Institute of Health during 1992 in connection with the development
of certain of the Company's heart pumps, $105,417 in settlement of accounts
payable to certain vendors, $110,000 amortization of the license fee received
from Wright Medical Technologies, Inc. and $1.0 million from United States
Surgical Corporation ("USSC") as a forfeited option fee. The remaining
$494,676 was realized on August 11, 1995 when the Company sold the European
patent for the OmniCath(R) atherectomy catheter for a purchase price of
$500,000 cash to Guerbet S.A. of France.
10
<PAGE> 11
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash requirements have been exceeding its resources due
to its expenditures related to research and development, size of its general
and administrative staff, expenditures related to obtaining regulatory
approvals, obtaining and maintaining manufacturing and distribution
arrangements and the expenses of product introductions.
During 1995 the Company was unable to meet certain of its obligations
as they came due. Certain executive officers have deferred payment of salaries
amounting to $290,433. In addition, the Company is in arrears to certain
vendors and suppliers. Accounts payable and accrued liabilities, including
deferred officer salaries, amounted to $1,789,996 at June 30, 1996. Management
has resolved a large percentage of these outstanding obligations by effecting
debt to equity conversion, which will become effective in the third quarter of
1996. (See Footnote 6 - Subsequent Events.) The Company had a working capital
deficiency as of June 30, 1996 of $2,013,630, an improvement of approximately
$1.8 million over December 31, 1995.
At June 30, 1996, the Company had cash and cash equivalents in the
amount of $807,190 compared with cash and cash equivalents of $9,177 at
December 31, 1995. Funds of approximately $1.7 million were received in
conjunction with a private placement during the first six months of 1996.
Options and warrants exercised during the second quarter provided the Company
with an additional $145,562.
In addition to the distributor agreements signed in 1995, agreements
were signed in June 1996 with a distributor in Mexico on an exclusive
arrangement and a non-exclusive agreement was finalized for the West Indies.
Discussions are proceeding regarding distributor agreements with companies in
Ireland, Germany, Belgium, Taiwan, China, Argentina, Brazil, Chile, Uruguay,
Paraguay, Hungary, Czech Republic and Poland. No agreements have been signed
or executed subsequent to June 30, 1996 and there can be no assurances of the
execution of any agreements.
The Company is also pursuing private label opportunities for its
Cathlab products to supply third-party companies with existing FDA approved
product lines. Additional opportunities are in the discussion stages to
provide OEM manufacturing capabilities to companies for products the Company
does not currently manufacture. No agreements have been signed or executed
subsequent to June 30, 1996 and there can be no assurances of the execution of
any agreements.
The Company is uncertain today that the distributors now in place will
be able to effectively market and sell the Company's core technologies, the
OmniCath(R), OmniStentTM and Evert-O-CathTM. As such, the Company has
undertaken efforts to identify healthcare companies with similar technologies
or companies seeking new proprietary products to strengthen their existing
market position. This strategy is directed toward the formation of strategic
alliances, joint venture arrangements, licensing and distributor agreements,
and research and development agreements/projects. An integral part of this
strategy is to aggressively pursue the sale of ancillary technologies (not core
technologies) which will enable the Company to focus its resources exclusively
on its core technologies and commercial non-angioplasty balloon catheter
products.
The Company requires additional funds to enable it to complete
development and, subject to obtaining required regulatory approvals,
commercialization of the OmniCath(R) for peripheral use, to enter into
marketing and distribution arrangements for the Evert-O-CathTM, to commence and
continue the development of other products and enhancements to the OmniCath(R)
and the Evert-O-CathTM, and to expand its manufacturing and distribution
abilities with respect to Cathlab products. If the Company experiences delays
in the introduction, manufacturing or sale of the OmniCath(R), or if the
OmniCath(R) does not achieve market acceptance for any reason, substantial
additional financing may be required by the Company to continue its operations,
and to improve, complete the development of, obtain regulatory approvals for,
and manufacture or market products. The Company receives some revenues and
expects to continue to receive revenues from the sale of Cathlab's products.
The Company anticipates that Cathlab's revenues should increase during 1996;
however, this increase will not be sufficient to satisfy the Company's funding
needs. The Company intends to cover any shortfall by ancillary
product/technology sales, licensing agreements or co-development agreements.
In addition, the Company expects to raise additional capital through a
private placement as well as warrant conversions.
11
<PAGE> 12
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Reference is made to the Company's report on Form 10-K for the year
ended December 31, 1995 and Form 10-Q for the quarter ended March 31, 1996 for
a description of other legal proceedings to which the Company became a party
during the six (6) months ended June 30, 1996, which information is
incorporated by reference herein.
ITEM 5. OTHER INFORMATION
The Company, in cooperation with its Principal Clinical Investigator,
Dr. Samuel S. Ahn, has filed an IRB (Institutional Review Board) at UCLA to
conduct a multi-center prospective randomized study comparing atherectomy using
the OmniCath(R) device vs. balloon angioplasty to treat Peripheral Arterial
Occlusion Disease. The clinical studies are scheduled to begin in third
quarter 1996. Upon conclusion of these clinical investigations, the Company
will submit a 510(k) Notification to the FDA for peripheral use of its
OmniCath(R) atherectomy catheter.
In addition, the Company is preparing to submit in the third quarter
1996 a U.S. Investigational Device Exemption (IDE) application so that clinical
trials can begin in the U.S. for use of its OmniCath(R) atherectomy catheter as
an adjunct to balloon angioplasty in the treatment of partial stenosis of
arteriovenous grafts. The Company is proceeding to develop a randomized
clinical investigation utilizing UCLA Medical Center as its Central Monitoring
Center. The Company will file an additional 510(k) Notification for this
indication as soon as the clinical investigations are concluded.
The Company is a party to litigation arising in the ordinary course of
business. Management regularly analyzes current information and, as necessary,
provides accrual for probable liabilities for the eventual disposition of the
matter. In the opinion of management, the ultimate outcome of these matters
will not materially affect the Company's financial position, results of
operations or cash flows.
The Board of Directors authorized an increase in the number of
directors to six on July 17, 1996. Richard S. Serbin was elected to fill the
vacant seat. Mr. Serbin is Executive Vice President and Director of
Bio-Imaging Technologies, Inc., and has served in that capacity since 1991.
Bio-Imaging Technologies, Inc. provides specialized consulting services to help
pharmaceutical and biotechnology companies and medical device manufacturers
facilitate drug and device evaluation and regulatory review. Mr. Serbin is a
registered patent attorney, registered pharmacist, a member of the Board of
Trustees of the Mountainside Hospital and a member of the Board of Health of
Roseland, New Jersey.
12
<PAGE> 13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. The following documents are filed as exhibits to this Report.
--------
11.1 Computation of Loss Per Common Share
27.1 Financial Data Schedule
13
<PAGE> 14
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN BIOMED, INC.
Date: August 5, 1996 /s/ Steven B. Rash
-----------------------------
Steven B. Rash
President and Chief
Executive Officer
Date: August 5, 1996 /s/ Colene F. Blankinship
-----------------------------
Colene F. Blankinship, CPA
Controller Chief Accounting
Officer
14
<PAGE> 15
INDEX TO EXHIBITS
Exhibit
-------
11.1 Computation of Income (Loss) Per Common Share
27.1 Financial Data Schedule
15
<PAGE> 1
EXHIBIT 11.1
AMERICAN BIOMED, INC. AND SUBSIDIARIES
COMPUTATION OF LOSS PER COMMON SHARE
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
1996 1995 1996 1995
---------------------------- --------------------------
<S> <C> <C> <C> <C>
Computation of loss per common share:
Net loss $ (727,599) $(1,157,982) $ (1,227,396) $ (1,673,888)
=========== =========== ============= =============
Weighted average shares outstanding 10,214,725 9,241,324 9,873,928 9,238,006
=========== =========== ============= =============
Loss per common share $ (.07) $ (.13) $ (.12) $ (.18)
=========== =========== ============= =============
Computation of loss per common share
assuming full dilution (A):
Weighted average shares outstanding
used in computing net loss per share 10,214,725 9,241,324 9,873,928 9,238,006
=========== =========== ============ =============
Loss per common share assuming full
dilution $ (.07) $ (.13) $ (.12) $ (.18)
=========== =========== ============ ============
</TABLE>
___________________
(A) This calculation is submitted in accordance with Securities and Exchange
Act of 1934 Release No. 9083 although it is contrary to APB Opinion 15
because it does not result in any dilution.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 807,190
<SECURITIES> 0
<RECEIVABLES> 182,105
<ALLOWANCES> 45,000
<INVENTORY> 421,478
<CURRENT-ASSETS> 1,798,787
<PP&E> 785,510
<DEPRECIATION> 646,054
<TOTAL-ASSETS> 2,958,149
<CURRENT-LIABILITIES> 3,812,417
<BONDS> 0
<COMMON> 11,781
0
0
<OTHER-SE> (1,614,460)
<TOTAL-LIABILITY-AND-EQUITY> 2,958,149
<SALES> 225,546
<TOTAL-REVENUES> 229,436
<CGS> 204,898
<TOTAL-COSTS> 206,473
<OTHER-EXPENSES> 1,113,574
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 197,683
<INCOME-PRETAX> (1,227,396)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,227,396)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,227,396)
<EPS-PRIMARY> (.12)
<EPS-DILUTED> (.12)
</TABLE>
