<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 1997
Commission File Number 1-12230
ADVANCED DEPOSITION TECHNOLOGIES, INC.
(Exact name of Small Business Issuer as Specified in its Charter)
Delaware 04-2865714
(State of Organization) (I.R.S. Employer
Identification Number)
580 Myles Standish Industrial Park, Taunton, Massachusetts 02780
(Address of Principal Executive Offices, Zip Code)
(508) 823-0707
(Issuer's Telephone Number, Including Area Code)
Indicate by check mark whether the issuers (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 and (2) has been subject to such filing
requirements for the past 90 days. YES X NO
--- ---
As of August 12, 1997, there were 3,965,945 shares of Common Stock,
$0.01 par value, of the issuer outstanding.
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NUMBER
Item 1. Financial Statements
<S> <C> <C>
Condensed and Consolidated Balance Sheets (unaudited): 1
June 30, 1997 and December 31, 1996
Condensed and Consolidated Statements of Income 2
(unaudited): for the Three Months and Six Months
ended June 30, 1997 and June 30, 1996
Condensed and Consolidated Statements of Cash Flows 3
(unaudited): for the Six Months ended June 30, 1997
and June 30, 1996
Notes to Condensed and Consolidated Financial 4-5
Statements
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6-10
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 12
</TABLE>
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
CONDENSED AND CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except share amounts)
ASSETS
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------- --------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 900 $ 1,170
Investment in marketable securities 948 1,240
Accounts receivable, net of reserve for doubtful accounts of $136
at June 30, 1997 and December 31, 1996 2,607 1,453
Inventories 1,684 1,667
Prepaid expenses and other current assets 136 123
------------- --------------
Total current assets 6,275 5,653
PROPERTY AND EQUIPMENT, net 5,228 5,189
OTHER ASSETS, net 1,676 1,740
------------- --------------
$ 13,179 $ 12,582
============= ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Revolving line of credit $ 204 $ 180
Current maturities of long-term debt 526 526
Accounts payable 928 802
Accrued liabilities 88 113
------------- --------------
Total current liabilities 1,746 1,621
----- -----
LONG-TERM OBLIGATIONS, net of current maturities 1,594 1,854
----- -----
STOCKHOLDERS' EQUITY;
Preferred stock, $0.01 par value
1,000,000 shares authorized, none issued -- --
Common stock, $0.01 par value,
10,000,000 shares authorized, 4,263,555 shares issued,
3,995,645 and 3,919,300 shares outstanding at
June 30, 1997 and December 31, 1996, respectively 43 42
Common stock purchase warrants 1,691 1,691
Additional paid-in capital 9,472 9,289
Retained deficit (271) (788)
------------- --------------
10,935 10,234
Less treasury stock, 297,610 and 310,610 shares respectively (1,096) (1,127)
------------- --------------
Total stockholders' equity 9,839 9,107
------------- --------------
$ 13,179 $ 12,582
============= ==============
</TABLE>
The Condensed and Consolidated Balance Sheet at December 31, 1996, has been
derived from the audited financial statements of the Company at that date.
See Notes to Condensed and Consolidated Financial Statements
1
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
CONDENSED AND CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(in thousands, except share and per share amounts)
<TABLE>
<CAPTION>
Three Months ended Six Months Ended
June 30, June 30,
------------------------------------- ------------------------------------
1997 1996 1997 1996
--------------- --------------- --------------- --------------
<S> <C> <C> <C> <C>
REVENUES:
Product sales $ 3,146 $ 2,184 $ 6,272 $ 4,398
Royalties, license fees and other 400 450 400 550
--------------- --------------- --------------- --------------
3,546 2,634 6,672 4,948
COST OF REVENUES 2,705 1,741 5,109 3,853
--------------- --------------- --------------- --------------
Gross Profit 841 893 1,563 1,095
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 442 272 827 586
RESEARCH AND DEVELOPMENT EXPENSES 59 30 120 51
--------------- --------------- --------------- --------------
Operating profit 340 591 616 458
INTEREST EXPENSE, NET OF
INTEREST INCOME 41 54 73 115
OTHER EXPENSE 12 -- 26 --
--------------- --------------- --------------- --------------
Net income $ 287 $ 537 $ 517 $ 343
=============== =============== =============== ==============
NET INCOME PER SHARE $ 0.07 $ 0.16 $ 0.13 $ 0.10
=============== =============== =============== ==============
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 4,074,873 3,310,687 4,102,174 3,279,706
=============== =============== =============== ==============
</TABLE>
See Notes to Condensed and Consolidated Financial Statements
2
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
CONDENSED AND CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(in thousands)
<TABLE>
<CAPTION>
Six months ended June 30,
------------------------------
1997 1996
----------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities $ (151) $ 511
----------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment (311) (99)
Decrease in investment in marketable securities 292 --
Increase in other assets (44) (165)
----------- ---------
Net cash used in investing activities (63) (264)
----------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings under revolving line of credit 24 --
Repayment of long term obligations (264) (99)
Proceeds from redemption of common stock purchase warrants 184 --
Exercise of stock options -- 9
----------- ---------
Net cash used in financing activities (56) (90)
----------- ---------
NET INCREASE (DECREASE) IN CASH (270) 157
CASH AND CASH EQUIVALENTS, beginning of period 1,170 598
----------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 900 $ 755
=========== =========
</TABLE>
See Notes to Condensed and Consolidated Financial Statements
3
<PAGE>
ADVANCED DEPOSITION TECHNOLOGIES, INC.
NOTES TO CONDENSED AND CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
June 30, 1997
1.) General
The accompanying unaudited condensed and consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial reporting and with the instructions to Form
10-QSB and Item 310 (b) of Regulation SB. Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements. Reference should be made to the
financial statements and related notes included in the Company's Annual Report
on Form 10-KSB for the year ended December 31, 1996, which was filed with the
Securities and Exchange Commission on April 15, 1997.
In the opinion of the management of the Company, the accompanying
financial statements reflect all adjustments that were of a normal recurring
nature necessary for a fair presentation of the Company's results of operations
and changes in financial position for the three and six month periods ended June
30, 1997 and June 30, 1996. Operating results for the three and six month
periods ended June 30, 1997 are not necessarily indicative of the results that
may be expected for the year ending December 31, 1997.
2.) Significant Accounting Policies
The accompanying condensed and consolidated financial statements
reflect the application of certain significant accounting policies, including
those described below.
a. Principals of consolidation
The accompanying condensed and consolidated financial statements
include the Company and its wholly owned subsidiary. All significant
intercompany balances and transactions have been eliminated in consolidation.
b. Revenue recognition
The Company recognizes revenues on its product sales upon shipment
and royalties and license fees as earned.
c. Inventories
Inventories are stated at the lower of cost (first-in, first-out) or
market and consist of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------- --------------
<S> <C> <C>
Raw materials $ 1,535 $ 1,283
Work in process and finished goods 516 751
------------- --------------
2,051 2,034
Less: Reserves for obsolescence 367 367
------------- --------------
Total $ 1,684 $ 1,667
============= ==============
</TABLE>
4
<PAGE>
d. Net Income per Common Share
Net income per common share has been determined by dividing net
income by the weighted average common shares outstanding during the period.
Common stock equivalents have been calculated in accordance with the treasury
stock method and are included for all periods where their effect is dilutive.
3.) Cash and Cash Equivalents
The Company considers all investments purchased with original
maturities of less than three months to be cash equivalents. Cash and cash
equivalents consist of the following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
Cash $ 289 $ 218
Cash equivalents 611 952
------------- ------------
Total $ 900 $ 1,170
============= ============
</TABLE>
4.) Investment in Marketable Securities
The Company adopted Statement of Financial Accounting Standards No.
115, "Accounting for Certain Investments in Debt and Equity Investments" (SFAS
No 115), effective January 1, 1994. As of June 30, 1997 and December 31, 1996,
investments in marketable securities that were classified as available-for-sale
and were recorded at fair value (which approximated cost) consisted of the
following (in thousands):
<TABLE>
<CAPTION>
June 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
United States Government obligations $ 948 $ 1,143
Corporate obligations -- 97
------------- ------------
Total $ 948 $ 1,240
============= ============
</TABLE>
5.) Exercise of Common Stock Purchase Warrants
The Company's Redeemable Common Stock Purchase Warrants (the "IPO
Warrants") expired on March 8, 1997. Approximately 78,000 IPO Warrants were
exercised during the first quarter of 1997, resulting in net proceeds to the
Company of approximately $184,000.
5
<PAGE>
ITEM 2: Management's Discussion and Analysis of Financial Condition and
---------------------------------------------------------------
Results of Operations
---------------------
General
- -------
Advanced Deposition Technologies, Inc. (the "Company" or "A. D.
TECH"), is a technology leader in developing and manufacturing high-resolution,
patterned, vacuum-metallized coatings for a variety of energy management
applications for use in industrial, commercial and consumer products. Included
among these are product offerings for electronic capacitors, microwave and
standard food packaging, security holograms, retroreflective films, barrier
packaging, electronic article surveillance (EAS), and electric static discharge
(ESD). The Company's revenue to date has been primarily from sales to the
capacitor and microwave packaging markets.
Recent Developments
- -------------------
During the three months ended June 30, 1997, the Company announced an
offer to acquire all of the common stock of Foilmark Inc. ("Foilmark"), a
manufacturer of holographics equipment and materials. The Company accepted
Foilmark's decision not to pursue discussions. The Company is continuing to seek
acquisition targets that could provide manufacturing synergies and distribution
channels for its proprietary processes and patented products.
The Company's patented high energy-density capacitor film, which
allows significant weight and size reductions for capacitors, continues to show
promising results in life tests. The Company expects that production orders
could begin shipping as early as the end of 1997.
The Company's retail microwave bag, currently being marketed under
the trade name BROWN & CRISP(R), has a second infomercial in process and is now
being sold in numerous international markets. A new microwave retail product,
the Microwave Roaster Bag, which can brown and crisp a whole chicken or turkey,
is also being introduced.
Results of Operations
- ---------------------
Three months ended June 30, 1997 compared to Three months ended June 30, 1996
Revenues. Revenues increased to $3,546,000 for the three months ended
June 30, 1997, as compared to $2,634,000 for the three months ended June 30,
1996, an increase of 35%. This increase is due to higher product sales to the
microwave food packaging market, including sales of the BROWN & CRISP(R)
product, partially off-set by lower price and reduced volume for capacitor and
standard packaging products. Royalty and license fees decreased by $50,000. In
this category, the Company recognized $400,000 in revenue during the three
months ended June 30, 1997 from the licensing of its proprietary Pattern
Metalized Printing ("PMP") technology.
Cost of Revenues. Cost of revenues totaled $2,705,000 (86.0% of
product sales) for the three months ended June 30, 1997, compared to $1,741,000
(79.7% of product sales) for the three months ended June 30, 1996. The increase
in cost of revenues was a result of additional sales into the microwave food
packaging market, including the BROWN & CRISP(R) bags, partially offset by the
decrease in sales to the
6
<PAGE>
capacitor and standard food packaging markets. The increase in cost of revenues
as a percentage of product sales was the result of lower selling prices for
metalized film, partially offset by greater shipments of higher-margin retail
microwave products.
Gross Profit. Gross profit decreased to $841,000 (26.7% of product
sales) for the three months ended June 30, 1997, compared to $893,000 (40.9% of
product sales) for the three months ended June 30, 1996. The decrease in gross
profit, both in absolute magnitude and as a percentage of revenue, was due to
lower prices and unit shipments of metalized film and lower licensing revenue,
partially offset by an increased volume of higher-margin retail microwave
products.
Selling, General and Administrative. Selling, general and
administrative expenses increased to $442,000 for the three months ended June
30, 1997 (14.0% of product sales) from approximately $272,000 for the three
months ended June 30, 1996 (12.5% of product sales). Higher payroll expenses and
professional fees were the primary reasons for the increase.
Research and Development. Research and development expenses increased
to $59,000 for the three months ended June 30, 1997, from approximately $30,000
for the three months ended June 30, 1996, due to additional amortization
expenses related to licenses acquired in 1996. Research and development
expenditures continue to be directed primarily at improving the Company's
technical capacity to produce higher resolution metallized patterns at higher
volumes for existing and new applications
Operating Profit. The Company generated operating profit of $340,000
for the three months ended June 30, 1997, compared to operating profit of
$591,000 for the three months ended June 30, 1996. The decrease was a result of
lower manufacturing margins and lower license revenues in conjunction with
higher selling, general and administrative expenses, partially offset by higher
shipments of retail microwave products.
Net Interest Expense. Net interest expense decreased to approximately
$41,000 for the three month period ended June 30, 1997, from $54,000 for the
three month period ended June 30, 1996. The decrease was primarily the result of
increased interest income as a result of additional funds being available for
investment.
Other Expense. Other expense was $12,000 during the three months
ended June 30, 1997, compared to an insignificant amount for the three months
ended June 30, 1996. Other expense includes the amortization of costs associated
with the new financing arrangement entered into during 1996.
Net Income. The Company generated net income of $287,000 for the
three months ended June 30, 1997, compared to net income of $537,000 for the
three months ended June 30, 1996, as a result of the factors discussed above.
Six months ended June 30, 1997 compared to Six months ended June 30, 1996
Revenues. Revenues increased to $6,672,000 for the six months ended
June 30, 1997, as compared to $4,948,000 for the six months ended June 30, 1996,
a 35% increase. The increase was due to higher product sales to the microwave
food packaging market, including sales of the BROWN & CRISP(R) product partially
off-set by lower price and reduced volume for capacitor and standard packaging
products.
7
<PAGE>
Royalty and license fees decreased by $150,000. In this category, the Company
recognized $400,000 in revenue during the six months ended June 30, 1997 from
the licensing of the Company's PMP technology.
Cost of Revenues. Cost of revenues totaled $5,109,000 (81.5% of
product sales) for the six months ended June 30, 1997, compared to $3,853,000
(87.6% of product sales) for the six months ended June 30, 1996. The increase in
cost of revenues was a result of additional sales into the microwave food
packaging market, including the BROWN & CRISP(R) bags, partially offset by the
decrease in sales to the capacitor and standard food packaging markets. The
decrease in cost of revenues as a percentage of product sales was the result of
a change in product mix towards higher-margin retail microwave products,
partially offset by lower selling prices for metalized film.
Gross Profit. Gross profit increased to $1,563,000 (24.9% of product
sales) for the six months ended June 30, 1997, compared to $1,095,000 (24.9% of
product sales) for the six months ended June 30, 1996. The increase in gross
profit was the result of the increase sales volume of microwave food packaging
materials, including the BROWN & CRISP(R) product partially offset by lower
capacitor, standard food packaging and licensing revenues.
Selling, General and Administrative. Selling, general and
administrative expenses increased to $827,000 for the six months ended June 30,
1997 (13.2% of product sales) from approximately $586,000 for the six months
ended June 30, 1996 (13.3% of product sales). Higher payroll expenses and
professional fees were the primary reasons for the increase.
Research and Development. Research and development expenses increased
to $120,000 for the six months ended June 30, 1997, from approximately $51,000
for the six months ended June 30, 1996, due to additional amortization expenses
related to licenses acquired in 1996. Research and development expenditures
continue to be directed primarily at improving the Company's technical capacity
to produce higher resolution metallized patterns at higher volumes for existing
and new applications
Operating Profit. The Company generated operating profit of $616,000
for the six months ended June 30, 1997, compared to operating profit of $458,000
for the six months ended June 30, 1996. The increase was a result of higher
sales volume and gross profit partially offset by higher selling, general and
administrative expenses.
Net Interest Expense. Net interest expense decreased to approximately
$73,000 for the six months ended June 30, 1997, from $115,000 for the six months
ended June 30, 1996. The decrease was primarily the result of increased interest
income as additional funds were available for investment.
Other Expense. Other expense was $26,000 during the six months ended
June 30, 1997, compared to an insignificant amount for the six months ended June
30, 1996. Other expense includes the amortization of costs associated with the
new financing arrangement entered into during 1996.
Net Income. The Company generated net income of $517,000 for the six
months ended June 30, 1997, compared to net income of $343,000 for the six
months ended June 30, 1996, as a result of the factors discussed above.
Liquidity and Capital Resources
- -------------------------------
The Company had working capital of approximately $4,529,000 at June
30, 1997, compared to working capital of $4,032,000 at December 31, 1996. The
increase in working capital is primarily the result of income from operations
and the exercise of approximately 78,000 Class A Redeemable Common Stock
8
<PAGE>
Purchase Warrants (the "IPO Warrants") in March 1997, from which the Company
realized net proceeds of approximately $184,000, partially offset by the
purchase of additional manufacturing equipment and the repayment of long-term
debt.
Cash used in operating activities for the six months ended June 30,
1997, was approximately $151,000 compared to cash provided by operating
activities during the six months ended June 30, 1996, of $511,000. Negative cash
flow from operations was the result of an increase in accounts receivable due to
a higher sales volume.
In the six month period ending June 30, 1997, the Company expended
$311,000 in capital investments. The investments during 1997 were primarily for
adding manufacturing capacity and increasing the efficiency of existing
equipment. As of June 30, 1997, the Company had no material commitments for
additional capital purchases.
On July 14, 1996, the Company entered into a credit agreement with a
bank that provides for a line of credit facility and a term loan facility (the
"Credit Facilities"). The Credit Facilities enabled the Company to refinance the
revolving line of credit and term debt that it had maintained with a former
lender and to repay all amounts due Printpack Enterprises, Inc. The line of
credit allows the Company to borrow up to $3,000,000 based on percentages of its
eligible accounts receivable, raw materials and finished goods inventories and
expires on July 8, 1999. Borrowings under the line of credit bear interest at a
rate per annum equal to the bank's prime lending rate plus 3/4%. The principal
amount of the term loan is $2,600,000. The term loan bears interest at a rate
per annum equal to the bank's prime lending rate plus 1% and must be repaid in
35 monthly installments of approximately $43,000, plus interest, with a balloon
payment of approximately $1,083,000 due in July 1999.
The Credit Facilities require the Company to maintain certain
financial ratios and tangible net worth levels, among others. As of December 31,
1996, the Company was in default of the minimum tangible net worth covenant. The
bank provided the Company with written notification which waives the event of
default through December 31, 1997. As of June 30, 1997, the Company is in
compliance with all of the other Credit Facility covenants and the outstanding
balances on the line of credit and the term loan were approximately $204,000 and
$2,105,000, respectively.
Management believes that the Company's cash, cash equivalents, and
short-term investments, together with anticipated cash flows from operations,
will provide sufficient funds to meet the Company's current cash requirements
and allow the Company to continue its marketing and product development efforts.
Seasonal Revenues
- -----------------
Historically, the Company has experienced lower sales to the
electronic capacitor market during the third quarter, particularly in July.
Based on market research conducted by the Company, it believes that demand for
the Company's other products, including microwave food packaging, does not
experience similarly timed seasonal variations and could, in the future, offset
lower third quarter sales in the electronic capacitor market.
Inflation
- ---------
Several times during the last two years, suppliers of the film used
in the Company's products experienced problems meeting demand that led to
shortages and price increases. In late 1995, the shortages began to ease and
prices have begun to decrease. In 1996, supplies of film increased in quantities
sufficient
9
<PAGE>
to meet demand and price increases abated. In 1997, there has been no material
change in supplies or prices of film.
Business Factors
- ----------------
This report may contain certain forward-looking statements that are
subject to certain risks and uncertainties. These statements include statements
regarding (i) the possibility of the acquisition by the Company; (ii) the
expected effects of the Company's high energy-density capacitor film; (iii)
price increases in the capacitor market; and (iv) the Company's liquidity. Such
statements are based on management's current expectations and are subject to a
number of factors and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements. The Company
cautions investors that there can be no assurance that actual results or
business conditions will not differ materially from those projected or suggested
in such forward-looking as a result of various factors, including, but not
limited to, the following; the Company's ability to identify an appropriate
acquisition target, the Company's ability to make an acquisition on favorable
terms, uncertainties regarding the performance advantages of the Company's high
energy-density capacitor films, market responses to pricing actions, continued
competitive factors and pricing pressures, the timely acceptance of new
products, inventory risk due to shifts in market demand, the development of
competing or superior technologies or products from other manufacturers, many of
which have substantially greater financial, technical and other resources than
the Company, dependence on key personnel, the variation in the Company's
operating results, technological change, the Company's ability to develop and
protect proprietary products and technologies, the availability of additional
capital on acceptable terms, if at all, to fund expansion, and general economic
conditions. For further information, refer to the more specific risks and
uncertainties discussed throughout this report.
10
<PAGE>
PART II - OTHER INFORMATION
Items 1 through 3: Not applicable
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
On May 22, 1997, the Company held its Annual Meeting of Stockholders
(the "Annual Meeting") to vote on the following proposals:
1. To elect two Class I Directors, the nominees being John J.
Moroney and Mark R. Thomas ("Proposal 1").
2. To approve an amendment to the Company's 1993 Stock Option Plan
to limit the number of shares of Common Stock that may be granted
pursuant to stock options to any employee in any one year period to a
number not exceeding 500,000 shares ("Proposal 2").
3. To ratify the appointment of BDO Seidman, LLP as independent
accountants for the Company for the fiscal year ending December 31,
1997 ("Proposal 3").
Of the total of 3,955,945 shares of the Company's Common Stock of
record as of April 10, 1997, able to vote at the Annual Meeting, a
total of approximately 2,806,157 shares were voted, or approximately
71% of the Company's issued and outstanding shares of Common Stock
entitled to vote on these matters.
Each of the proposals was adopted, with the vote totals as follows:
Proposal 1:
Election of Directors
- ---------------------
For Withheld
--- --------
John J. Moroney 2,793,505 (99.55%) 12,652 (0.45%)
Mark R. Thomas 2,799,505 (99.76%) 6,652 (0.24%)
Proposal 2:
To approve an amendment to the Company's 1993 Stock Option Plan to limit the
number of shares of Common Stock that may be granted pursuant to stock options
to any employee in any one year period to a number not exceeding 500,000 shares.
For Against Abstain
--- ------- -------
2,588,238 (96.78%) 59,407 (2.22%) 26,681 (1.00%)
Proposal 3:
To ratify the appointment of BDO Seidman, LLP as independent accountants for the
Company for the fiscal year ending December 31, 1997.
For Against Abstain
--- ------- -------
2,776,406 (98.94%) 5,875 (0.21%) 23,876 (0.85%)
11
<PAGE>
Item 5. Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) See Exhibit Index.
(b) Reports on Form 8-K. On May 27, 1997, the Company filed Form 8-K
in regard to its offer to acquire Foilmark, Inc. ("Foilmark"). In that filing it
was reported that the Company had made an offer to acquire Foilmark for an
undisclosed amount of cash and common stock. On July 16, 1997, the Company filed
Form 8-K in regard to Foilmark's decision not to pursue discussions on the
acquisition offer. In that filing it was reported that the Company accepted
Foilmark's decision not to pursue discussions related to the acquisition offer.
12
<PAGE>
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 of the
undersigned thereunto duly authorized.
Advanced Deposition Technologies, Inc.
--------------------------------------
Registrant
August 13, 1997 /s/ Glenn J. Walters
- --------------- ---------------------------------------
Glenn J. Walters
President
August 13, 1997 /s/ Mark R. Thomas
- --------------- ---------------------------------------
Mark R. Thomas
Chief Financial Officer
13
<PAGE>
Exhibit Index
-------------
Exhibit Description
------- -----------
27.1 Financial Data Schedule
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-QSB
FILED WITH SEC AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 900
<SECURITIES> 948
<RECEIVABLES> 2,743
<ALLOWANCES> 136
<INVENTORY> 1,684
<CURRENT-ASSETS> 6,275
<PP&E> 8,181
<DEPRECIATION> 2,953
<TOTAL-ASSETS> 13,179
<CURRENT-LIABILITIES> 1,746
<BONDS> 0
0
0
<COMMON> 9,515
<OTHER-SE> 324
<TOTAL-LIABILITY-AND-EQUITY> 13,179
<SALES> 6,272
<TOTAL-REVENUES> 6,672
<CGS> 5,109
<TOTAL-COSTS> 6,056
<OTHER-EXPENSES> 26
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 73
<INCOME-PRETAX> 517
<INCOME-TAX> 0
<INCOME-CONTINUING> 517
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 517
<EPS-PRIMARY> 0.13
<EPS-DILUTED> 0.13
</TABLE>
