UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
Commission File Number: 0000-23721
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LIFEPOINT, INC.
(Exact name of registrant as specified in its charter)
DELAWARE #33-0539168
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
10400 Trademark Street, Rancho Cucamonga, CA 91730
(Address of Principal Executive Offices) (Zip Code)
(909) 466-8047
Registrant's Telephone Number, Including Area Code
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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date.
As of November 10, 1998 - Common Stock, $.001 Par Value, 11,711,206 shares
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEETS
September 30
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1998 March 31
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(Unaudited) 1998
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ASSETS
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Current Assets:
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Cash and cash equivalents $ 656,511 $ 597,254
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Prepaid expenses and other current assets 418,570 150,150
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Total current assets 1,075,081 747,404
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Property and equipment, net 189,398 286,188
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Patents and other assets, net 53,463 39,692
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$ 1,317,942 $ 1,073,284
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Current Liabilities:
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Accounts payable $ 180,057 $ 119,577
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Accrued expenses 541,516 217,876
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Total current liabilities 721,573 337,453
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Commitments and contingencies (Note 4)
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Stockholders' equity:
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Common stock, $.001 par value; 50,000,000 shares
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authorized, 11,711,206 and 10,497,206 issued and
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outstanding at September 30, 1998 and March 31, 1998,
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respectively 11,711 10,497
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Additional paid-in capital 13,554,323 12,398,933
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Deficit accumulated in the development stage (12,969,665) (11,673,599)
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Total stockholders' equity 596,369 735,831
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$ 1,317,942 $ 1,073,284
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The accompanying notes are an integral part of the financial statements.
2
<PAGE>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
Cumulative
<CAPTION>
From
For the For the October 8, 1992
Three Months Ended Six Months Ended (Inception) to
September 30 September 30 September 30,
1998 1997 1998 1997 1998
<S> <C> <C> <C> <C> <C>
Revenues $ - $ - $ - $ - $ -
Costs and Expenses:
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General and Administrative Expenses 474,082 33,256 657,491 170,534 3,242,039
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Research and Development 294,491 170,832 558,193 700,674 6,277,294
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Depreciation and Amortization 52,149 88,761 104,178 105,491 880,870
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Interest Expense - Parent - - - 34,530 95,790
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Management Fees - Parent - - - 409,838 2,089,838
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Interest Expense - - - - 119,300
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Total Costs and Expenses 820,722 292,849 1,319,862 1,421,067 12,705,131
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Loss from Operations (820,722) (292,849) (1,319,862) (1,421,067) (12,705,131)
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Other Income/(Expense) 19,133 - 23,796 - (264,534)
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Net Loss $(801,589) $ (292,849) $(1,296,066) $(1,421,067) $ (12,969,665)
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Earnings per Common Share:
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Weighted Average Common Shares
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Outstanding 11,697,597 7,297,206 11,223,632 6,707,502
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Net Loss Per Common Share $ (0.07) $ (0.04) $ (0.12) $ (0.21)
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Earnings per Common Share, Assuming
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Dilution:
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Weighted Average Common Shares
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Outstanding 15,225,506 7,297,206 14,389,151 6,707,502
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Net Loss Per Common Share, Assuming
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Dilution $ (0.05) $ (0.04) $ (0.09) $ (0.21)
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</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
<TABLE>
<CAPTION>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
(Unaudited)
Cumulative
From
October 8, 1992
For the Six Months Ended (Inception) to
September 30 September 30,
1998 1997 1998
<S> <C> <C> <C>
Cash Flow from Operating Activities:
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Net Loss $ (1,296,066) $ (1,421,067) $ (12,969,665)
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Adjustments to Reconcile Net Loss to Net Cash
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Used by Operating Activities:
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Depreciation and Amortization 104,178 105,491 880,870
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Consulting Expense 137,930 - 137,930
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Disposal of Property and Equipment - - 237,976
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Unrealized Loss on Marketable Securities - - 627,512
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Amortization of Bond Discount - - (4,855)
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Changes in Operating Assets and Liabilities:
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(Increase) Decrease in Prepaid Expenses and
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Other Current Assets 48,650 - (67,099)
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(Increase) Decrease in Other Assets (9,792) 4,993 (14,128)
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Decrease in Bank Overdraft - (119,514) -
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Increase (Decrease) in Accounts Payable 60,480 (159,126) 234,416
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Increase (Decrease) in Accrued Expenses 5,980 168,122 88,856
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Net Cash Used by Operating Activities (948,640) (1,421,101) (10,848,187)
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Cash Flow From Investing Activities:
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Sale of Marketable Securities - - 3,285,625
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Purchases of Marketable Securities - - (3,908,281)
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Purchases of Property and Equipment (6,197) (19,065) (602,974)
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Proceeds from Sale of Property and Equipment, Net - - 80,828
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Patent Costs (5,170) (1,402) (44,409)
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Net Cash Used by Investing Activities (11,367) (20,467) (1,189,211)
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Cash Flow from Financing Activities:
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Sales of Common Stock 1,025,000 - 11,246,226
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Expenses of Stock Offering (5,736) - (1,681,586)
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Payment of Loan to Parent - - (1,917,057)
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Proceeds of Loan by Parent - - 1,634,762
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Proceeds of Loan Payable - Parent - 1,464,811 4,715,067
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Payment of Loan Payable - Parent - - (1,299,782)
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Proceeds of Capital Leases - - 101,572
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Payments of Capital Leases - - (105,293)
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Proceeds of Brokerage Loan Payable - - 2,674,683
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Payments of Brokerage Loan Payable - - (2,674,683)
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Net Cash Provided by Financing Activities 1,019,264 1,464,811 12,693,909
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</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
(Continued)
Cumulative
From
October 8, 1992
For the Six Months Ended (Inception) to
September 30 September 30,
1998 1997 1998
<S> <C> <C> <C>
Increase (Decrease) in Cash and Cash Equivalents 59,257 23,243 656,511
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Cash and Cash Equivalents - Beginning of Period 597,254 - -
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Cash and Cash Equivalents - End of Period $ 656,511 $ 23,243 $ 656,511
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Supplemental Disclosure of Cash Information:
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Cash Paid for Interest $ - $ - $ 192,046
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Noncash Operating Activities:
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Value of Common Stock Issued (Returned) and
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Additional Paid-in Capital for Consulting Services (12,660) - 137,340
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Noncash Investing Activities:
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Value of Assets Transferred to Lessor in Lieu of
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Payment on Capital Leases - - 71,405
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Noncash Financing Activities:
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Value of Common Stock Issued and Additional
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Paid-in Capital for the Tranfer of Assets from
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Parent - 344,000 781,060
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Value of Common Stock Issued to Parent and
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Additional Paid-in Capital for the Forgiveness of
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Debt - 3,082,996 3,160,502
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Value of Warrants to be Issued for Consulting
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Services 467,660 - 467,660
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</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(Unaudited)
NOTE 1 - Basis of Presentation
In the opinion of LifePoint, Inc. (the "Company"), the accompanying
unaudited financial statements reflect all adjustments (which include only
normal recurring adjustments except as disclosed below) necessary to present
fairly the financial position, results of operations and cash flows for the
periods presented. Results of operations for interim periods are not necessarily
indicative of the results of operations for a full year due to external factors
which are beyond the control of the Company. This Report should be read in
conjunction with the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1998 (the "Annual Report").
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings per Share (FASB No. 128), which is effective for
annual and interim periods ending after December 15, 1997. FASB No. 128 replaced
the previously required primary and fully diluted earnings per share (EPS) with
basic and diluted EPS. Unlike primary earnings per share, basic earnings per
share excludes any dilutive effects of options, warrants and convertible
securities. Diluted earnings per share is very similar to the previously
required fully diluted earnings per share. All earnings per share amounts for
all periods have been presented and, where necessary, restated to conform to
FASB No. 128. There were no adjustments necessary to net loss in calculating the
income available to common stockholders after assumed conversions of stock
options and warrants that are considered to be dilutive. The adjusted weighted
average shares to give effect for the assumed conversion of dilutive stock
options and warrants is presented on the Statements of Operations.
NOTE 2. - Continuing Operations and Liquidity
The Company has historically incurred recurring operating losses due to
the fact that it is still a development stage enterprise incurring research and
development expenses and deriving no revenues and has experienced an ongoing
deficiency in working capital. The Company financed its operations during the
quarter ended June 30, 1998 from the remainder of the net proceeds of $1,434,000
realized from a private placement in November and December 1997 pursuant to
Regulation D under the Securities Act of 1993, as amended (the "Securities
Act"), which sold 3,200,000 shares of the Company's Common Stock, $.001 par
value (the "Common Stock"), at $0.50 per share or an aggregate purchase price of
$1,600,000. Recognizing that such financing would only furnish sufficient
working capital through July 1998, the Company initiated a second private
placement in July 1998 pursuant to Regulation D under the Securities Act, with a
minimum of 1,000,000 shares and a maximum of 5,000,000 shares of the Common
Stock at $1.00 per share. The Company closed on the minimum of 1,000,000 shares
on July 17, 1998, and on August 26, 1998, the Company sold an additional 25,000
shares of the Common Stock, or an aggregate of 1,025,000 shares of the Common
Stock offered pursuant to the private placement. The
6
<PAGE>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(Unaudited)
(Continued)
NOTE 2. - Continuing Operations and Liquidity (Continued)
offering of a minimum of 1,000,000 and a maximum of 5,000,000 shares of the
Common Stock expired by its terms on October 14, 1998 without any additional
shares being sold.
The Company will require additional capital to continue the research,
development and ultimate manufacture and marketing of its product. The Company
now estimates it will cost approximately $5,000,000 to complete the prototype of
its first product and an additional $8,000,000 to bring the product to market.
As a result of its continuing operational losses and its continuing capital
requirements at March 31, 1998, there was raised substantial doubt about the
Company's ability to continue as a going concern. The financial statements in
this Report do not include any adjustments to reflect the possible future
effects, if any, on the recoverability and classification of assets on the
amounts and classification of liabilities that may result from the outcome of
this uncertainty.
The Company continues to pursue parallel paths in addition to
initiating another private placement to secure funding; strategic partnering,
venture capital investors and a possible public offering. There can be no
assurance that any of these additional sources of financing will be available
and, in such event, the Company will not be able to complete its research and
development on a timely basis.
NOTE 3 - Property and Equipment
Property and equipment is summarized as follows:
September 30, March 31,
1998 1998
---------------- ------------
Furniture and Fixtures $293,699 $287,502
Test Equipment 425,768 425,768
Leasehold Improvements 209,155 209,155
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928,622 922,425
Less: Accumulated Depreciation 739,224 636,237
---- ------- ---- -------
$189,398 $286,188
======== ========
7
<PAGE>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(Unaudited)
(Continued)
NOTE 4 - Commitments and Contingencies
In June 1995, the License Agreement with the Department of the Navy
then held by Substance Abuse Technologies, Inc. ("SAT"), the Company's then
parent, was renegotiated and amended to provide for minimum annual royalties of
$100,000 per year commencing October 1, 1995 and terminating September 30, 2005.
Additional royalties will be paid pursuant to a schedule based upon sales of
products. Through March 31, 1997, the Company sub-licensed this Agreement from
its then parent and, accordingly, had obligations to its then parent for the
royalty payments required by the License Agreement. This license was transferred
from SAT to the Company effective with the sale of SAT's majority ownership of
the Common Stock on October 29, 1997. The Navy settled all past liabilities for
the transferred license for $10,000.
On March 3, 1998, the license from the Navy was expanded to an
exclusive, worldwide license for all saliva diagnostics. The terms of the
license expansion are currently being negotiated.
NOTE 5 - Stockholders' Equity
During the quarter ended June 30, 1998, the Company issued 300,000
shares of stock to a consultant in exchange for services to be rendered through
January 2000. The excess of the value of the services of $149,700 over the stock
value was recorded as an increase to additional paid-in capital. The obligation
to issue these shares was provided for at March 31, 1998. By mutual agreement
this contract was terminated on September 10, 1998, and 145,000 unearned shares
were returned to the Company.Additionally, all stock options were also
cancelled.
During the quarter ended September 30, 1998, the Company issued
100,000 shares of stock to a consultant in lieu of cash, for internet investor
relations work to be performed over the following six months. During the quarter
ended September 30, 1998, the Company issued warrants to three outside parties
to purchase an aggregate of 600,000 shares of the Common Stock at prices ranging
from $0.50 to $2.16 per share as payment for consulting services. As of
September 30, 1998, there were warrants outstanding to purchase 2,621,289 shares
of the Common Stock.
The LifePoint, Inc. 1997 Stock Option Plan (the "Plan"), as adopted by
the Board of Directors of the Company on August 14, 1997 and amended on June 5,
1998, now provides for the granting of options to purchase an aggregate of
2,000,000 shares (originally 1,000,000 shares) of the Common Stock.
Stockholders' approval of the Plan is being sought at the Annual Meeting of
Stockholders on August 13, 1998. Options granted under the Plan may either be
incentive stock options designed to meet the requirements of Section 422 of the
Internal Revenue
8
<PAGE>
LIFEPOINT, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1998
(Unaudited)
(Continued)
NOTE 5 - Stockholders' Equity (Continued)
Code of 1986, as amended, or non-statutory or non-qualified stock options not
intended to satisfy such requirements. The exercise price per share for
incentive stock options will not be less than 100% of the fair market value per
share of the Common Stock on the grant date. For non-statutory or non-qualified
stock options, the exercise price per share may not be less than 85% of such
fair market value. No option may have a term in excess of ten years.
During the quarter ended September 30, 1998, no options were granted
pursuant to the Plan. As of September 30, 1998, there were 1,100,000 shares held
by a total of 12 employees pursuant to the Plan.
9
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
General.
The Company was incorporated on October 8, 1992 under the laws of the
State of Delaware as a wholly-owned subsidiary of Substance Abuse Technologies,
Inc. ("SAT"). Effective January 1, 1993, SAT sublicensed or transferred to the
Company certain rights or assets to develop drug testing products in exchange
for 3,500,000 shares of the Common Stock. In October 1993, the Company had a
public offering of the Common Stock in which an aggregate of 1,721,900 shares
was sold. As of September 30, 1997, SAT owned 5,575,306 shares of the Common
Stock or 76.4% of the 7,297,206 shares of the Common Stock then outstanding.
From its inception until October 31, 1997, the Company was a subsidiary of SAT
or otherwise under its control. SAT ceased providing advances to the Company in
August 1997 as a result of its inability to secure financing for its own
programs. On September 10, 1997, SAT filed a petition under Chapter 11 of the
Federal Bankruptcy Code. The Company temporarily suspended its product
development activities on September 19, 1997, but did not file for bankruptcy.
The Company was able to resume such activities on October 27, 1997 as a result
of a loan by an unaffiliated party. On October 29, 1997, the majority ownership
of the Company was transferred from SAT to Meadow Lane Partners, LLC. The
Company is now completely independent from SAT.
The Company is a development stage company focused on the
commercialization of the flow immunosensor technology licensed from the Naval
Research Laboratories. The flow immunosensor technology, in combination with the
focus on the use of saliva as a non-invasive test medium, will allow the Company
to develop a broadly applicable non-invasive, rapid, on-site diagnostic test
system. The first product under development is for the detection of drugs of
abuse and alcohol. However, other major market opportunities include rapid
diagnostic testing (substances of abuse, drug overdose, and heart attack),
long-term therapeutic drug monitoring to determine efficacy and compliance
(cardiovascular disease, osteoporosis), and wellness/health screening
(cardiovascular disease, osteoporosis, cancer).
Liquidity and Capital Resources.
Until August 1997 when SAT's inability to secure its own financing
caused SAT to cease advances to the Company, SAT had been the sole source of
financing to the Company since the Company's public offering of 1,721,900 shares
of the Common Stock in October and November 1993, which netted the Company
approximately $7,099,000. During the fiscal year ended March 31, 1997 and
through July 1997, SAT advanced $3,426,994 to the Company to fund its
operations, all of which was subsequently reflected as additional capital
contributions from SAT.
As a result of two loans made to the Company in September and October
1997 totaling $310,000 ($10,000 from an officer and $300,000 from an
unaffiliated source), both loans secured by a lien on the assets of the Company,
the Company recommenced its product development on October 27, 1997. During the
third quarter of 1997, the Company repaid the loans from the net proceeds
($1,434,000) of a private placement pursuant to Regulation D under the
Securities Act, which sold 3,200,000 shares of the Common Stock at $0.50 per
share or an aggregate purchase price of $1,600,000.
The Company's management at the time of the private placement
estimated that the net proceeds from the private placement would enable the
Company to continue its operations, at the reduced level, through July 1998.
Management has been actively pursuing during 1998, on a parallel basis, venture
capital, strategic partnering, and/or a private placement for all or part of the
required funding.
However, because management recognized that it may have beyond July to
implement one of these long term financing possibilities, in July 1998,
management implemented a private placement of $1,000,000 to $5,000,000 in an
effort to enable the Company to continue its operations, including research and
development of its product, until one of these long term financing programs
could be successfully implemented. The Company received the minimum of
$1,000,000 on July 16, 1998, and, on August 26, 1998, the Company sold an
additional 25,000 shares of the Common Stock, or an aggregate of 1,025,000
shares of the Common Stock offered pursuant to this second private placement.
10
<PAGE>
The offering of a minimum of 1,000,000 and a maximum of 5,000,000 shares of the
Common Stock expired by its terms on October 14, 1998 without any additional
shares being sold.
The latest estimate of the Company's management is that, to complete
the development of a saliva- based drugs of abuse and alcohol testing product,
it will require additional funding of $13,000,000, of which $5,000,000 is needed
to develop the prototype, and that the product is not expected to be launched
until late in the second quarter of 2000. Such estimates as to amount and date
are based on the assumption that at least $3,000,000 in financing will be
obtained in the next few months.
The Company has engaged the services of The Kriegsman Group, founded by
Steven Kriegsman, a Los Angeles-based investment banker focused on obtaining
private financing for young medical, biotech, and pharmaceutical companies. The
Kriegsman Group has been focusing on implementing a private placement for
$7,000,000 to $10,000,00 in equity from individuals or institutions for the
Company. Ambient Capital Group, Inc., also a Los Angeles-based investment
banker, will act as co-agent with The Kriegsman Group in such an offering.
The Company's management has also been exploring the possibility of
obtaining a strategic partner for the Company. To this end, the Company has an
agreement with Burrill & Company ("Burrill"), a San Francisco-based merchant
bank focused exclusively on servicing life science companies. Burrill assists
its portfolio companies in maximizing their value through various strategic
partnering relationships. Burrill & Company was founded by G. Steven Burrill, an
internationally recognized financial, business, and management advisor to the
life science industry. Mr. Burrill is founder of The Biotech Meeting and the
International Life Sciences Partnering Conference, both held annually. A team of
twelve professionals is augmented by a world class Business Advisory Board. The
Board is comprised of eight members including: Jack Bowman, former Company Group
chairman of Johnson & Johnson; Irwin Lerner, retired Chairman of the Board of
Hoffmann-La Roche Inc.; Herbert Conrad, former President of the Pharmaceutical
Division and senior Vice President of Hoffmann-La Roche Inc.; Paul Freiman,
former Chairman and Chief Executive Officer of Syntex Corporation; Martin
Gerstel, former chairman and Chief Executive Officer of ALZA Corporation; Leigh
Thompson, former Scientific Officer of Eli Lilly and Company. Burrill had been
engaged to introduce LifePoint to potential partners with an on-going interest
in saliva-based diagnostics or point-of-care diagnostics and which might be
otherwise interested in partnering with or acquiring LifePoint at an early
stage.
Management is also pursuing the possibility of a venture capital
investment; however, most venture capital investors prefer a private company for
their investment, and look to an Initial Public Offering ("IPO") as their
preferred exit strategy. Although management continues to work with several
interested venture capital firms, this potential route of funding is currently
not the most likely to occur.
Management has also pursued the possibility of an underwritten public
offering and has received expressions of interest from several well-known small
national and large regional firms. This option has been put on hold by
management due to the length of time required to close such transaction;
however, it remains an alternative to be pursued following a private financing
for capital requirements.
Results of Operations
Three Months Ended September 30, 1998 vs. September 30, 1997
During the quarter ended September 30, 1998, the Company spent
$294,491 on research and development and an additional $474,082 on general and
administrative expenses, as compared with $170,832 and $33,256, respectively,
during the three months ended September 30, 1997. The higher research and
development and general and administrative expenditures in the 1998 period were
due to the fact that during the same period in September 1997, the Company
ceased the product development program, and had significantly reduced
expenditures for that period of time. Additionally, the general and
administrative expenses for the three months ended September 30, 1998, included
corporate legal expenses that were higher than usual due to timing and a
significant royalty payment to the Navy.
11
<PAGE>
From inception on October 8, 1992 to September 30, 1998, the Company
has spent $6,277,294 on research and development and $3,242,039 on general and
administrative expenses. Management fees paid to SAT aggregated $2,089,838
during such period.
Six Months Ended September 30, 1998 vs. September 30, 1997
During the six months ended September 30, 1998, the Company spent
$558,193 on research and development and an additional $657,491 on general and
administrative expenses, as compared with $700,674 and $170,534, respectively,
during the six months ended September 30, 1997. The general and administrative
expenses for the six months ended September 20, 1998 are higher because, during
the same period in 1997, significant general and administrative expenses were
paid to SAT as a management fee, and these expenses are now incurred directly by
the Company. During the six months ended September 30, 1997, an additional
$409,838 was paid to SAT as the management fee. The research and development
expenses for the six months ended September 30, 1998 were higher than the same
period during 1997 due to the fact that during the same period in September 1997
the Company ceased the product development program.
Forward-Looking Statements
This Management's Discussion and Analysis of Financial Condition and
Results of Operations contains forward-looking statements which involve risk and
uncertainties. Such forward-looking statements reflect management's current
views that the necessary financing will be available, when needed, to complete
the research and development program, that the product will be developed at the
contemplated cost and within the projected timetable, that, during the interim
period before the Company begins marketing, competitors will not begin to market
a competitive saliva-based testing product and that the other risks described in
the Annual Report and other filings by the Company with the Securities and
Exchange Commission will not materially adversely affect the Company's
operations. Because there can be no assurance that management's expectations
will be realized, actual results may differ.
Item 3. Quantitative and Qualitative Disclosures about Market Risk.
Not applicable.
12
<PAGE>
PART II
OTHER INFORMATION
Item 2. Changes in Securities
(a) Not applicable.
(b) Not applicable.
(c) Recent Sales of Unregistered Securities
(i) On July 23, 1998, the Company closed as to the sale of 1,000,000 shares of
the Common Stock and, on August 26, 1998, the Company sold an additional 25,000
shares of the Common Stock, or an aggregate of 1,025,000 shares of the Common
Stock offered pursuant to a private placement. The offering of a minimum of
1,000,000 and a maximum of 5,000,000 shares of the Common Stock expired by its
terms on October 14, 1998 without any additional shares being sold.
(ii) There were no underwriters for this private placement.
The shares of the Common Stock were offered and sold to persons who were
accredited investors as such term is defined in Rule 501(a) under the Securities
Act of 1933, as amended (the "Securities Act").
(iii) The shares of the Common Stock were sold for $1.00 per
share or an aggregate purchase price of $1,025,000. There were no underwriting
discounts or commissions related to the private placement.
(iv) The Company claims that the sales were exempt from the
registration requirements of the Securities Act pursuant to Section 4(2)
thereunder and Rule 506 of Regulation D thereunder, the sales constituting a
transaction by an issuer not involving any public offering. The purchasers were
all accredited investors, each of whom or which gave an investment
representation.
(d) Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
(a) The Annual Meeting of Stockholders was held on August 13, 1998.
(b) At the Meeting, Peter S. Gold, Linda H. Masterson, Jonathan J.
Pallin, and Paul Sandler were re-elected as the sole directors of the Company.
(c) At the meeting, votes were taken as to three proposals as follows:
(1) On the proposal to elect four directors:
Broker
Nominee For Withheld Non-Votes
Peter S. Gold 9,233,686 6,900 1,200,081
Linda H. Masterson 9,233,686 6,900 1,200,081
Jonathan J. Pallin 9,233,686 6,900 1,200,081
Paul Sandler 9,233,686 6,900 1,200,081
13
<PAGE>
(2) On the proposal to ratify the appointment of Ernst &
Young, LLC as independent auditors for the fiscal year ending March 31, 1999:
Broker
For Against Withheld Non-Votes
9,158,186 67,000 15,400 1,200,081
(3) On the proposal to adopt the LifePoint, Inc. 1997 Stock
Option Plan and to ratify the prior grants of options thereunder:
Broker
For Against Withheld Non-Votes
9,115,261 104,925 20,400 1,200,081
(d) Not Applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
There were no Reports on Form 8-K filed during the quarter for
which this Report is filed.
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this Report to be signed on its behalf by the
undersigned therein to be duly authorized.
LIFEPOINT, INC.
(Registrant)
Date: November 13, 1998 By /s/ Linda H. Masterson
---------------------------------------------
Linda H. Masterson
President and Chief Executive Officer
14
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<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-START> JUL-01-1998
<PERIOD-END> SEP-30-1998
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