<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES ACT OF 1934
For Quarter Ended December 31, 1997
Commission File Number 0-23252
IGEN International, Inc.
-------------------------------------------------------
(Exact name of registrant as specified in is charter)
DELAWARE 94-2852543
- -------------------------------------------------------------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
16020 INDUSTRIAL DRIVE, GAITHERSBURG, MD 20877
-------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(301) 984-8000
-------------------------------------------------------
(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 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.
YES X NO
----- -----
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
CLASS Outstanding at January 31, 1998
----- -------------------------------
Common Stock, $0.001 par value 15,174,135
IGEN International, Inc. Form 10-Q For the Quarter Ended December 31, 1997
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
PART I FINANCIAL INFORMATION
Item 1: FINANCIAL STATEMENTS
Balance Sheets -- December 31, 1997 and March 31, 1997 3
Statements of Operations--For the Three and Nine
Months Ended December 31, 1997 and 1996 4
Statements of Cash Flows--For the Nine Months Ended
December 31, 1997 and 1996 5
Notes to Financial Statements 6
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 8
PART II OTHER INFORMATION
Item 1: LEGAL PROCEEDINGS 11
Item 2: CHANGES IN SECURITIES 12
Item 6: EXHIBITS AND REPORTS ON FORM 8-K 12
SIGNATURES 13
</TABLE>
2
<PAGE>
IGEN International, Inc.
Balance Sheets
(In thousands)
<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1997
------------ -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents............................................... $ 3,408 $ 790
Short term investments.................................................. 23,070 8,254
Accounts receivable..................................................... 1,340 2,200
Inventory............................................................... 1,588 2,075
Prepaid expenses and other current assets............................... 1,062 866
------------ -----------
Total current assets.................................................. 30,468 14,185
------------ -----------
EQUIPMENT, FURNITURE, AND IMPROVEMENTS.................................. 7,303 6,950
Accumulated depreciation and amortization............................... (4,638) (3,781)
------------ -----------
Equipment, furniture, and improvements, net........................... 2,665 3,169
------------ -----------
OTHER ASSETS............................................................ 411 440
------------ -----------
TOTAL................................................................... $ 33,544 $ 17,794
------------ -----------
------------ -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses................................... $ 4,706 $ 4,266
Deferred revenue........................................................ 3,469 5,393
Obligations under capital leases........................................ 131 95
------------ -----------
Total current liabilities............................................. 8,306 9,754
------------ -----------
OBLIGATIONS UNDER CAPITAL LEASES -
NONCURRENT............................................................ 158
STOCKHOLDERS' EQUITY:
Convertible Preferred Stock, $0.001 par
value, 10,000,000 shares authorized, issuable in series:
Series A, 600,000 shares designated, none issued; Series B,
25,000 shares issued and outstanding.................................. 1
Common stock: $.001 par value, 50,000,000 shares
authorized: 15,147,510 and 14,987,416 issued and outstanding:......... 15 15
Additional paid-in capital.............................................. 89,098 64,876
Accumulated deficit..................................................... (63,591) (56,700)
Notes receivable from sale of common stock.............................. (285) (309)
------------ -----------
Total stockholders' equity............................................ 25,238 7,882
------------ -----------
TOTAL................................................................... $ 33,544 $ 17,794
------------ -----------
------------ -----------
</TABLE>
See notes to financial statements.
3
<PAGE>
IGEN International, Inc.
Statements of Operations
(In thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
-------------------- --------------------
<S> <C> <C> <C> <C>
1997 1996 1997 1996
--------- --------- --------- ---------
REVENUES:
Product sales...................................... $ 1,352 $ 1,698 $ 4,121 $ 5,031
Royalty income..................................... 2,112 42 5,225 88
License fees and contract revenue.................. 310 2,780 2,855 8,732
--------- --------- --------- ---------
Total............................................ 3,774 4,520 12,201 13,851
--------- --------- --------- ---------
OPERATING COSTS AND EXPENSES:
Product costs...................................... 464 731 1,408 1,969
Research and development........................... 2,888 3,399 8,493 10,033
Marketing, general and administrative.............. 2,950 2,888 8,990 7,991
--------- --------- --------- ---------
Total............................................ 6,302 7,018 18,891 19,993
--------- --------- --------- ---------
LOSS FROM OPERATIONS................................. (2,528) (2,498) (6,690) (6,142)
INTEREST INCOME (EXPENSE)--net....................... 72 261 (1) 671
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES........................... (2,456) (2,237) (6,691) (5,471)
INCOME TAX EXPENSE................................... -- -- 200 --
--------- --------- --------- ---------
NET LOSS............................................. $ (2,456) $ (2,237) $ (6,891) $ (5,471)
--------- --------- --------- ---------
--------- --------- --------- ---------
BASIC AND FULLY DILUTED NET LOSS PER SHARE........... $ (0.16) $ (0.15) $ (0.46) $ (0.37)
--------- --------- --------- ---------
--------- --------- --------- ---------
SHARES USED IN COMPUTING NET LOSS PER SHARE.......... 15,157 14,969 15,082 14,955
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
See notes to financial statements.
4
<PAGE>
IGEN International, Inc.
Statements of Cash Flows
(In thousands)
(unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
DECEMBER 31,
1997 1996
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss............................................................ $ (6,891) $ (5,471)
Adjustments to reconcile net income to net cash provided by
(used in) operating activities:
Interest on notes receivable from sale of common stock............ -- (5)
Amortization of deferred compensation............................. -- 82
Depreciation and amortization..................................... 857 896
Deferred revenue.................................................. (1,924) (7,436)
Add (deduct) items not affecting cash:
Decrease in accounts receivable................................. 860 (179)
Decrease (increase) in inventory................................ 487 (269)
(Increase) decrease in prepaid expenses and other assets........ (166) 684
Increase accounts payable and accrued expenses.................. 440 147
------- ---------
Net cash used in operating expenses........................... (6,337) (11,551)
------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for equipment, furniture and improvements............ (353) (555)
(Purchase) sale of short-term investments......................... (14,816) 9,128
------- ---------
Net cash provided by investing activities...................... (15,169) 8,573
------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of notes receivable from sale of common stock........... 24 33
Issuance of convertible preferred stock, net...................... 23,625
Issuance of common stock.......................................... 597 163
Principal payments under capital lease obligations................ (122) (229)
------- ---------
Net cash provided by (used in) financing activities............. 24,124 (33)
------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS................ 2,618 (3,011)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD...................... 790 4,001
------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD............................ $ 3,408 $ 990
------- ---------
------- ---------
</TABLE>
See notes to financial statements.
5
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
Notes to Financial Statements (unaudited)
1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES
The financial statements of IGEN International, Inc. (the "Company")
reflect, in the opinion of management, all adjustments, consisting only of
normal and recurring adjustments, necessary to present fairly the Company's
financial position at December 31, 1997 and the Company's results of
operations for the three and nine month periods ended December 31, 1997 and
1996 respectively. Interim period results are unaudited and are not
necessarily indicative of results of operations or cash flows for a full year
period. The balance sheet at March 31, 1997 was derived from audited
financial statements at such date.
Pursuant to accounting requirements of the Securities and Exchange
Commission applicable to quarterly reports on Form 10-Q, the accompanying
financial statements and these notes do not include all disclosures required
by generally accepted accounting principles for complete financial
statements. Accordingly, these statements should be read in conjunction with
the Company's most recent annual financial statements included in the
Company's Annual Report for the fiscal year ended March 31, 1997.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash Equivalents and Short-Term Investments--Cash equivalents include
cash in banks, money market funds, securities of the U.S. Treasury and
certificates of deposit with original maturities of three months or less.
Concentration of Credit Risks--The Company has invested its excess cash
generally in securities of the U.S. Treasury, money market funds,
certificates of deposit and corporate bonds. The Company invests its excess
cash in accordance with a policy objective that seeks to ensure both
liquidity and safety of principal. The policy limits investments to certain
types of instruments issued by institutions with strong investment grade
credit ratings and places restrictions on their terms and concentrations by
type and issuer.
Inventory is recorded at the lower of cost or market using the first-in,
first-out method and consists of the following (in thousands):
<TABLE>
<CAPTION>
DECEMBER 31, 1997 MARCH 31, 1997
----------------- ---------------
<S> <C> <C>
Finished goods........................... $ 913 $ 1,095
Work in process.......................... 144 150
Raw materials............................ 531 830
------ ------
Total.................................... $ 1,588 $ 2,075
------ ------
------ ------
</TABLE>
6
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
Notes to Financial Statements (continued)
Equipment, Furniture, and Improvements are carried at cost. Depreciation
is computed over the estimated useful lives of the assets, generally five
years, using accelerated methods.
Revenue Recognition--Nonrefundable license fees, option fees, royalty
income, and milestone payments in connection with research and development
contracts or commercialization agreements with corporate partners are
recognized when they are earned in accordance with the applicable performance
requirements and contractual terms. Amounts received in advance of
performance under contracts or commercialization agreements are recorded as
deferred revenue until earned. Product sales revenue is recorded as products
are shipped.
Loss Per Share has been computed based on the weighted average number of
common shares and common equivalent shares outstanding.
3. BOEHRINGER MANNHEIM GMBH LITIGATION
In 1992, the Company entered into a License and Technology Development
Agreement with Boehringer Mannheim GmbH ("BMG"), pursuant to which BMG
launched its Elecsys product line, which is based on the Company's ORIGEN
technology. As more fully set forth in Part II -- Item 1, the Company is
involved in litigation with BMG arising out of the Agreement. One of the
disputes at issue in the litigation relates to the computation of royalties
to which the Company is entitled under the Agreement, which the Company
believes have been understated by BMG. For the three and nine-month periods
ended December 31, 1997, royalties recorded by the Company under the
Agreement totaled $2.1 million and $5.0 million, respectively. These amounts
were charged against deferred revenues represented by a $6 million advance,
secured by future royalties, from BMG in January 1997. It is likely that BMG
will dispute the amount of royalties earned under the contract through
December 31, 1997.
4. PREFERRED STOCK FINANCING
In December 1997, the Company completed a $25 million convertible
preferred stock financing. This financing included several of the Company's
current investors, as well as new investor groups.
7
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Overview
The Company devotes substantially all of its resources to the research,
development and marketing of its proprietary technologies and products,
primarily the ORIGEN technology for clinical diagnostic and life science
research products. The Company's sources of revenue have consisted primarily
of license or research payments pursuant to licensing or collaborative
research agreements, product sales and from royalties on sales of products by
the Company's licensees. The Company has entered into collaborative
arrangements with corporate collaborators that provide for the development
and marketing of certain ORIGEN systems. These agreements provide fees and
royalties payable to the Company in exchange for licenses to produce and sell
the resulting products. While the Company may selectively pursue additional
strategic alliances, it expects an increasing amount of its revenues to be
derived from sales of its products and royalties from corporate
collaborations.
Certain statements in this Form 10-Q are "forward-looking statements"
made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements involve a number of
risks and uncertainties. Factors which may cause the Company's actual results
in future periods to differ materially from forecast results include, but are
not limited to: the risk factors set forth in the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 1997, including, without
limitation, reliance on collaborations and license patents and proprietary
rights, uncertainty of health-care reform measures and third-party
reimbursements, the ability to attract and retain qualified personnel,
including scientists and consultants to perform research and development
work; general economic and business conditions, both national and
international; and the outcome of the pending litigation involving the
Company. IGEN disclaims any intent or obligation to update these
forward-looking statements.
RESULTS OF OPERATIONS
THE QUARTER AND NINE MONTHS IN REVIEW
The Company reported a net loss of $2.5 million ($.16 per share) on revenue
of $3.8 million for the third quarter ended December 31, 1997 compared to a
net loss of $2.2 million ($.15 per share) on revenue of $4.5 million for the
same period in the prior year. The net loss for the first nine months of
fiscal 1998 was $6.9 million ($.46 per share) on revenue of $12.2 million
compared to $5.5 million ($.37 per share) on revenue of $13.9 million in the
same period for fiscal 1997. Revenues during the quarter and for the nine
months ended December 31, 1997 reflect a significant change in revenue mix
compared to prior year periods, as the Company's license and contract revenue
has converted to royalty income based on product sales by corporate
licensees. During the nine month period through December 31, 1997, $9.3
million (77%) of revenue was generated from the sale of products, either
directly by IGEN or from royalties on licensees' sales. In the prior year,
IGEN revenue related to the sale of products totaled $5.1 million (37% of
total revenue). Accordingly, revenue from license fees and for contract
research decreased to $2.9 million for the nine months ended December 31,
1997 from $8.7 million in the prior year.
8
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (CONTINUED)
In 1992, the Company entered into a License and Technology Development
Agreement with Boehringer Mannheim GmbH ("BMG"), pursuant to which BMG
launched its Elecsys product line, which is based on the Company's ORIGEN
technology. As more fully set forth in Part II -- Item 1, the Company is
involved in litigation with BMG arising out of the Agreement. One of the
disputes at issue in the litigation relates to the computation of royalties
to which the Company is entitled under the Agreement, which the Company
believes have been understated by BMG. For the three and nine-month periods
ended December 31, 1997, royalties recorded by the Company under the
Agreement totaled $2.1 million and $5.0 million, respectively. These amounts
were charged against deferred revenues represented by a $6 million advance,
secured by future royalties, from BMG in January 1997. It is likely that BMG
will dispute the amount of royalties earned under the contract through
December 31, 1997.
Operating costs decreased to $6.3 million and $18.9 million in the
current quarter and first nine months of fiscal 1998 compared to $7 million
and $20 million in the same periods last year. Due to expiring external
collaborations, research and development expenditures decreased to $2.9
million and $8.5 million in the quarter and first nine months of the current
year, compared to amounts in the same prior year periods of $3.4 million and
$10 million, respectively. Marketing, general and administrative costs
remained constant at $2.9 million during the current and prior years'
quarter. These costs increased to $9 million for the nine months ended
December 31, 1997 from $8 million in the same prior year period due in part
to professional and legal fees associated with the Company's litigation with
BMG.
Income (loss) from operations over the next several years is likely to
fluctuate substantially from quarter to quarter as a result of differences in
the timing of revenues earned under license and product development
agreements, and associated product development expenses.
As of March 31, 1997, the Company had federal net operating loss and
general business credit tax carry forwards of approximately $41.9 million and
$2.4 million, respectively. The Company's ability to utilize its net
operating loss and general business credit tax carry forwards may be subject
to an annual limitation in future periods pursuant to the "change in
ownership rules" under Section 382 of the Internal Revenue Service Code of
1986, as amended.
9
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (CONTINUED)
LIQUIDITY AND CAPITAL RESOURCES
The Company has financed its operations through the sale of Preferred and
Common Stock, aggregating approximately $90 million through December 31,
1997, collaborative research and licensing agreements, royalty payments, and
sales of its ORIGEN line of products. In December 1997, the Company completed
a $25 million convertible preferred stock financing. This financing included
several of the Company's current investors, as well as new investor groups.
As of December 31, 1997, the Company had $26.5 million in cash, cash
equivalents and short-term investments. Working capital excluding current
deferred revenue, which is classified as a current liability, was $25.6
million at December 31, 1997. Including current deferred revenue, working
capital was $22.2 million.
Net cash used in operating activities was $6.3 million for the nine
months ended December 31, 1997, as compared to $11.6 million for the
corresponding prior year period. This decrease in use of cash was due
primarily to a $4.75 million payment IGEN received during the current period
from one of its corporate licensees, Eisai Co., Ltd. This payment consisted
of Eisai's final license fee payment of $2 million recorded as revenue in
this period and the balance representing a non-refundable royalty advance on
Eisai's future product sales of the Picolumi Immunodiagnostic System, which
commenced distribution in Japan during the summer of 1997.
The Company used $353,000 and $555,000 of net cash for investing
activities, substantially related to the acquisition of laboratory equipment,
furniture and leasehold improvements, during the nine months ended December
31, 1997 and 1996, respectively.
The Company expects to incur substantial additional research and
development expenses, manufacturing costs and marketing and distribution
expenses. It is the Company's intention to selectively seek additional
collaborative or license agreements with suitable corporate collaborators
although there can be no assurance the Company will be able to enter into
such agreements or that amounts received under such agreements will reduce
substantially the Company's funding requirements. Additional equity or debt
financing may be required, and there can be no assurance that these funds may
be available on favorable terms, if at all.
The Company's future capital requirements depend on many factors,
including continued scientific progress in its diagnostics programs, the
magnitude of these programs, the time and costs involved in obtaining
regulatory approvals, the costs involved in filing, prosecuting and enforcing
patent claims, competing technological and market developments, changes in
its existing license and other agreements, the ability of the Company to
establish development arrangements, the cost of manufacturing scale-up and
effective commercialization activities and arrangements.
10
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
PART II OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS
On September 15, 1997, the Company filed a lawsuit in Maryland
against Boehringer Mannheim GmbH ("BMG"), a German company to which
the Company has licensed certain rights to develop and
commercialize diagnostic products based on the Company's ORIGEN
technology. That lawsuit is pending in the Southern Division of the
United States District Court for the District of Maryland. The
Company's dispute with BMG arises out of a 1992 License and
Technology Development Agreement (the "Agreement"), pursuant to
which BMG developed and launched its "Elecsys" line of diagnostic
products, which is based on ORIGEN technology. The Company alleges
that BMG has failed to perform certain material obligations under
the Agreement, including development and commercialization of
ORIGEN technology according to the contractual timetable;
exploitation of the license to the extent contemplated by the
parties; phase out of certain non-royalty-bearing product lines;
exploitation of ORIGEN technology only within BMG's licensed
fields; proper treatment of intellectual property rights regarding
ORIGEN technology; maintenance of records essential to the
computation of royalties; and proper computation of royalties. In
its lawsuit, the Company seeks damages as well as injunctive and
declaratory relief, including a judicial determination of its
entitlement to terminate the Agreement.
On September 15, 1997, shortly after the Company filed its lawsuit
in Maryland, BMG filed a lawsuit in the United States District
Court for the Southern District of Indiana (Indianapolis Division)
seeking a declaration that it did not breach the Agreement and a
preliminary injunction precluding the Company from terminating the
Agreement pending the judicial resolution of the dispute between
the parties. In addition, BMG sought and obtained a temporary
restraining order that precludes the Company from terminating the
Agreement; IGEN has agreed to the continuation of the temporary
restraining order until BMG's motion for preliminary injunction can
be adjudicated. On January 26, 1998, the United States District
Court for the District of Maryland ruled that the litigation
between the Company and BMG will go forward in Maryland. (The
Company expects that BMG's Indiana action will be dismissed or
consolidated with the Maryland action.)
In December 1997, IGEN International K.K., a Japanese subsidiary of
the Company, filed a lawsuit in Tokyo District Court against
Hitachi Ltd. ("Hitachi"). This lawsuit seeks to enjoin Hitachi from
manufacturing, using or selling the Elecsys 2010 immunoassay
instrument in Japan. The lawsuit also seeks to enjoin Hitachi from
infringing the subsidiary's license registration, known in Japan as
a "senyo-jisshi-ken," in connection with the development of the
Mosys instrument. Hitachi is the sole manufacturer for Boehringer
Mannheim of the Elecsys 2010 immunoassay instrument. Boehringer
Mannheim sells the Elecsys 2010 worldwide to hospitals and clinical
reference laboratories. Hitachi is also developing for Boehringer
Mannheim the Mosys instrument. The Company's Japanese subsidiary
alleges that both the Elecsys 2010 and the Mosys are based on
ORIGEN technology. The Company's ORIGEN technology is licensed to
its Japanese subsidiary and to Eisai K.K. pursuant to a
"senyo-jisshi-ken." The Company's Japanese subsidiary further
alleges that Hitachi's manufacturing and selling of the Elecsys
2010 and the development of Mosys violate the "senyo-jisshi-ken."
The lawsuit requests injunctive relief against Hitachi and
destruction of the Elecsys 2010 and Mosys instruments in Hitachi's
possession.
11
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
ITEM 2: CHANGES IN SECURITIES
On December 19, 1997, the Company sold 25,000 shares of Series B
Convertible Preferred Stock with a par value of $0.001 per share
for $1,000 per share to several of the Company's current investors,
as well as new investor groups. This private financing, which
raised $25 million, was arranged by Credit Suissse First Boston
Corporation who received $1,250,000, or 5% of the proceeds, as its
commission for coordinating the transaction. Exemption from
registration was claimed under Regulation D and Section 4(2) of the
Securities Act of 1933. The private placement was made to fewer
than 35 accredited investors. Shares of Series B Convertible
Preferred Stock (the "Preferred Shares") are non-redeemable and
convertible, based on their stated value, into shares of common
stock of the Company (the "Common Shares") at a rate of $13.96 per
Common Share (as adjusted for stock splits, stock dividends and
similar transactions, the "Conversion Price") at the option of the
holder on and after the ninetieth day following the closing of the
private placement of the Preferred Shares. In addition, the Company
may elect to pay the dividend of 7.75% (annually compounded) of the
stated value of the Preferred Shares in cash or in Common Shares
based on a dividend conversion rate equal to the Conversion Price.
If the Company elected to pay all possible dividends on the
Preferred Shares in Common Shares, it would have to issue 810,172
Common Shares. On the fifth anniversary of the closing of the
private placement, the Company may, at its option either redeem the
Preferred Shares in cash for their stated value plus accrued
dividends or convert the Preferred Shares into Common Shares at a
rate equal to the Conversion Price.
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
11.1 Statements regarding computation of per share earnings for
the three and nine months ended December 31, 1997 and 1996.
27 Financial Data Schedule
(b) Reports on Form 8-K:
On December 24, 1997, the Company filed a Form 8-K announcing
completion of a $25 million convertible preferred stock financing.
12
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
IGEN INTERNATIONAL, INC.
Date: February 13, 1998 /s/ George V. Migausky
---------------------------------------------
George V. Migausky
Vice President of Finance and Chief Financial
Officer (on behalf of the Registrant and as
Principal Financial Officer)
13
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
EXHIBIT INDEX
<TABLE>
EXHIBIT NUMBER DESCRIPTION
- -------------- -----------
<S> <C>
11.1 Computation of per share data
27 Financial Data Schedule
</TABLE>
14
<PAGE>
IGEN International, Inc.
Form 10-Q
For the Quarter Ended December 31, 1997
EXHIBIT 11.1
Statement Re: Computation of Net Loss Per Share
(In thousands, except per share data)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
DECEMBER 31, DECEMBER 31
-------------------- --------------------
<S> <C> <C> <C> <C>
1997 1996 1997 1996
--------- --------- --------- ---------
Average Common Shares Outstanding:..................... $ 15,157 $ 14,969 $ 15,082 $ 14,955
--------- --------- --------- ---------
--------- --------- --------- ---------
Net Loss............................................... $ (2,456) $ (2,237) $ (6,891) $ (5,471)
--------- --------- --------- ---------
--------- --------- --------- ---------
Basic and Fully Diluted Net loss per share............. $ (.16) $ (.15) $ (.46) $ (.37)
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
1
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-START> APR-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 3,408
<SECURITIES> 23,070
<RECEIVABLES> 1,383
<ALLOWANCES> 43
<INVENTORY> 1,588
<CURRENT-ASSETS> 30,468
<PP&E> 7,303
<DEPRECIATION> (4,638)
<TOTAL-ASSETS> 33,544
<CURRENT-LIABILITIES> 8,306
<BONDS> 0
0
1
<COMMON> 15
<OTHER-SE> 25,222
<TOTAL-LIABILITY-AND-EQUITY> 33,544
<SALES> 4,121
<TOTAL-REVENUES> 12,201
<CGS> 1,408
<TOTAL-COSTS> 18,891
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1<F1>
<INCOME-PRETAX> (6,691)
<INCOME-TAX> 200
<INCOME-CONTINUING> (6,891)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,891)
<EPS-PRIMARY> (0.46)
<EPS-DILUTED> (0.46)
<FN>
<F1>net of interest income
</FN>
</TABLE>
