SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported):
February 27, 1998
PARADIGM MEDICAL INDUSTRIES, INC.
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(Exact name of registrant as specified in this Charter)
Utah 0-28498 87-0459536
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(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
1127 West 2320 South, Suite A, Salt Lake City, Utah 84119
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(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number,
Including Area Code: (801) 977-8970
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Does Not Apply
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(Former name or former address, if changed since last report)
<PAGE>
ITEM 7. Financial Statements and Exhibits
(b) The following pro forma statements of Paradigm Medical
Industries, Inc. are included herein:
Pro Forma Condensed Consolidated Balance Sheet as of
January 31, 1998 (unaudited)
Condensed Consolidated Statement of Operations
for the month ended January 31, 1998 (unaudited)
<PAGE>
PARADIGM MEDICAL INDUSTRIES, INC.
BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
Pro forma as of
January 31, January 31, 1998
1998 (Unaudited)
(Unaudited) (See Notes A & B
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<S> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents $ 689,035 $ 2,288,875
Trade accounts
receivable 138,329 138,329
Inventories 943,164 943,164
Prepaid expenses 154,735 154,735
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Total current
assets 1,925,263 3,525,103
Deferred charges,
net 303,208 521,368
Property and
equipment, net 116,341 116,341
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Total assets $2,344,812 $ 4,162,812
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Trade accounts
payable $ 149,793 $ 149,793
Accounts payable -
related parties 412,155 412,155
Accrued expenses 340,329 340,329
Note payable to
bank - current 3,245 3,245
Purchase deposit 38,500 38,500
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Total current
liabilities 944,022 944,022
Note payable,
less current portion 15,494 15,494
12% Convertible Redeemable
Notes due 12/08/2000 1,070,000 75,000
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Total liabilities 2,029,516 1,034,516
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Stockholders' equity:
Preferred stock, $.001
par value, authorized:
5,000,000 shares
Series A, $.001 par
value, authorized:
500,000 shares;
issued and outstanding:
122,764 shares at
December 31, 1996
and 50,122 shares at
January 31, 1998
(aggregate liquidation
preference of $200,488
at January 31, 1998) 50 50
Series B, $.001 par
value, authorized:
500,000 shares; issued
and outstanding:
448,398 shares at
December 31, 1996
and 45,381 shares at
January 31, 1998
(aggregate liquidation
preference of $181,524
at January 31, 1998 45 45
Series C, $.001 par value
authorized 30,000 shares
($100 stated value) issued
and outstanding: 0 shares
at December 31, 1996 and
28,130 shares at
January 31, 1998 0 28
Additional paid-in
capital, preferred stock 76,186 2,889,158
Common stock, $.001 par
value, authorized:
20,000,000 share; issued
and outstanding:
3,194,061 shares at
December 31, 1996 and
3,798,939 shares at
January 31, 1998 3,799 3,799
Additional paid in
capital, common stock 8,195,501 8,195,501
Treasury stock, 2,600
shares, at cost (3,777) (3,777)
Accumulated deficit (7,956,508) (7,956,508)
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Total stockholders'
equity 315,296 3,128,296
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Total liabilities
and stockholders'
equity $ 2,344,812 $ 4,162,812
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</TABLE>
Note A:
On January 23, 1998, Nasdaq's staff determined that the
shares of Series C Convertible Preferred Stock would
be accepted as equity and could be included in the calculation
for determining compliance with Nasdaq's capital and surplus
requirement. As a result, in a private placement, the Company
offered for sale a minimum of 10,000 shares ($1,000,000) and a
maximum of 18,000 shares ($1,800,000) of Series C Convertible,
non-cumulative 12% dividend Preferred Stock $.001 par value at
$100 per share (the "Series C Preferred Stock"). However, the Company
may elect to increase the amount of shares to be offered to 19,300,
subject to the prior written consent of Win Capital Corp. (the
"Placement Agent"). The Company also offered noteholders who had
purchased an aggregate of $1,070,000 of 12% Convertible,
Redeemable Promissory Notes prior to this offering, the right to
exchange their notes for shares of Series C Preferred Stock at the
exchange rate of 500 shares of Preferred Stock for each $50,000
note.
Note B:
As of February 27, 1998, Noteholders converted $995,000 of
the 12% Convertible, Redeemable Promissory Notes due 12/8/00 into
9,950 shares of Series C Preferred Stock. The Company raised an
additional $1,818,000 through the sales of Series C Preferred Stock
to accredited investors as of February 27, 1998. The Company's
Board of Directors has authorized the Placement Agent to accept
no more than $112,000 in additional sales of Series C Preferred
Stock in conformity with the Company's Certificate of Incorporation
that authorizes the issuance of 30,000 shares of Series C Preferred
Stock at $100 per share.
<PAGE>
PARADIGM MEDICAL INDUSTRIES, INC.
STATEMENT OF OPERATIONS
For the Month Ended January 31, 1998
(Unaudited)
<TABLE>
<CAPTION>
One Month Ended
January 31, 1998
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(Unaudited)
<S> <C>
Sales $ 62,081
Cost of sales 37,150
Amortization of deferred charges 6,188
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Net cost of sales 43,338
Gross profit $ 18,743
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Gross margin 30%
Operating expenses:
Marketing and selling 43,531
General and administrative 83,502
Research and development 17,351
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Total operating expenses 144,384
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Operating loss $ (125,641)
Interest income 3,422
Interest expense 10,746
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Total other income (expense) (7,324)
Net Loss $ (132,966)
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</TABLE>
<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 by the undersigned hereunto duly authorized.
PARADIGM MEDICAL INDUSTRIES, INC.
(Registrant)
Date: February 27, 1998 By: John W. Hemmer
Treasurer and Chief Financial
Officer
