UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
Current Report
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 29, 1998
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Creative Medical Development, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 33-75276 68-0281098
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(State or jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
975 SE Sandy Blvd., Portland, Oregon 97214
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (503) 230-8034
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(Former name or former address, if changed since last report.)
Item 5. Other Events.
(a) On October 29, 1998, the Company issued a press release as follows:
CREATIVE MEDICAL DEVELOPMENT, INC., ANNOUNCES MANAGEMENT CHANGE AT OMNI
PRODUCTS, INC.
PORTLAND, OREGON, October 29, 1998 . . . OMNI Products Inc., a wholly owned
subsidiary of CREATIVE MEDICAL DEVELOPMENT, INC. (OTC BULLETIN BOARD: CMDI,
CMDIW) named Robert E. Tuzik President and Chief Operating Officer. Tuzik,
formerly Vice President of Marketing and Sales, will continue his Marketing
duties and assume responsibility for Operations, Engineering and Quality.
Mr. Tuzik is a 25-year veteran of the railway industry. Prior to joining OMNI as
Director of Sales and Marketing in June 1996, Tuzik operated Talus Associates, a
consulting company specializing in railway marketing and media relations. He is
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the former Editor of Railway Track and Structures and Engineering Editor of
Railway Age, the industry's foremost trade publications. Prior to his work in
publishing, sales and marketing he held a variety of positions in the Operating
Department of the former Santa Fe Railway.
"We are pleased to have an individual with Bob's experience and abilities assume
a greater role in the overall operations of the company," said William E. Cook,
OMNI's interim CEO. "By this appointment we are sending a strong message that we
expect Bob to lead the Company's expansion in sales that is required to build
shareholder value and forge the path to a more successful growth strategy for
OMNI."
OMNI Products, Inc., the Company's wholly owned subsidiary, is a leading
supplier of a full line of premium virgin rubber and concrete highway-rail grade
crossing surfaces. OMNI supplies crossing surfaces to all major North American
railroads, numerous short line and regional railroads, independent railway
contractors, transit systems, ports, intermodal yards, manufacturing facilities
with rail access, and municipalities.
(b) On November 16, 1998, the Company issued a press release as follows:
CREATIVE MEDICAL DEVELOPMENT, INC., ANNOUNCES NEW CHAIRMAN
PORTLAND, OREGON, November 16, 1998 . . . CREATIVE MEDICAL DEVELOPMENT, INC.
(OTC BULLETIN BOARD: CMDI, CMDIW) (ACMD@), announced today that William E. Cook
has been appointed to the board of directors and designated Chairman.
Mr. Cook, the President of Riptide Holdings, Inc., a management consulting firm
focussing on turnaround companies, has been serving as a consultant to the
Company's board of directors to evaluate the Company's management, business
strategy and financial structure and as the interim Chief Executive Officer. His
prior experience includes positions as founding Chief Executive Officer of
Signal Technology Corporation, Chairman and Chief Executive Officer of DDL
Electronics, and as a director of a number of private technology companies.
Edward S. Smith who has been serving as Chairman since the beginning of the
restructuring process will continue as a director. He has been a director of
OMNI Products, Inc. ("OMNI") since 1994 and of CMD since the merger of OMNI and
CMD April 30, 1997. He is President/Owner of Ted Smith & Company and the former
Chairman and CEO of Omark Industries, Inc., an international manufacturer of
cutting chain for chain saws, hydraulic log loaders and sporting ammunition. Mr.
Smith is also a Director of Georgia Gulf Corporation and Expert Systems
Publishing Company.
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OMNI Products, Inc., the Company's wholly owned subsidiary, is a leading
supplier of a full line of premium virgin rubber and concrete/rubber
highway-rail grade crossing surfaces. OMNI supplies crossing surfaces to all
major North American railroads, numerous short line and regional railroads,
independent railway contractors, transit systems, ports, intermodal yards,
manufacturing facilities with rail access, and municipalities.
(c) On November 23, 1998, the Company issued a press release as follows:
CREATIVE MEDICAL DEVELOPMENT, INC.--EARNINGS FOR SIX MONTHS ENDED OCTOBER
31,1998
PORTLAND, OREGON, November 23, 1998 . . . CREATIVE MEDICAL DEVELOPMENT, INC.
(OTC BULLETIN BOARD: CMDI, CMDIW) ("CMD"), announced today it will report a net
profit of $237,312 ($0.05 per share) on sales of $3,182,869 for its second
quarter ended October 31, 1998 compared to a profit of $2,515 on sales of
$4,762,624 for the same quarter last year and a profit for the six month period
of $457,490 ($0.09 per share) on sales of $6,825,107 compared to $58,643 ($0.01
per share) last year on sales of $8,589,007.
William E. Cook, Chairman, attributed the improved performance of the Company to
implementation of the restructuring plan which has increased gross margins,
lowered selling, general, administrative and engineering costs and reduced
interest expense by significantly reducing total debt.
OMNI Products, Inc., the Company's wholly owned subsidiary, is a leading
supplier of a full line of premium virgin rubber and concrete/rubber
highway-rail grade crossing surfaces. OMNI supplies crossing surfaces to all
major North American railroads, numerous short line and regional railroads,
independent railway contractors, transit systems, ports, intermodal yards,
manufacturing facilities with rail access, and municipalities.
Except for the historical information contained herein, the matters set forth in
this release include forward-looking statements within the meaning of the "safe
harbor" provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and uncertainties that may
cause actual results to differ materially. These risks and uncertainties are
detailed and are discussed from time to time in the Company's periodic reports
filed with the Securities and Exchange Commission. The forward-looking
statements included in this release speak only as of the date hereof.
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CREATIVE MEDICAL DEVELOPMENT, INC. & SUBSIDIARY
CONSOLIDATED BALANCE SHEET
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Assets
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Unaudited Audited
October 31, April 30,
1998 1998
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Current Assets:
Cash $ 125,765 $ 393,877
Accounts receivable, net 1,190,509 1,853,280
Inventories 870,745 1,423,800
Other current assets 203,263 52,158
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Total current assets 2,390,282 3,723,115
Real estate held for sale 1,840,958 1,618,275
Property plant and equipment, net 1,748,335 2,272,214
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$ 5,979,575 $ 7,613,604
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Liabilities and Stockholder' Deficit
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Current liabilities:
Accounts payable 1,809,840 1,884,679
Accrued liabilities 872,551 1,459,092
Notes payable 1,658,747 3,305,283
Current portion of long-term debt 2,095,883 2,136,376
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Total current liabilities 6,437,021 8,785,430
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Long-term debt, less current portion 865,483 522,342
Non-current accrued liabilities
Stockholders' deficit
Common stock 51,092 55,246
Convertible preferred stock 5,869 6,221
Additional paid-in capital 2,331,906 2,413,651
Accumulated deficit (3,711,796) (4,169,286)
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Total stockholder's deficit (1,322,929) (1,694,168)
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$ 5,979,575 $ 7,613,604
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<CAPTION>
CREATIVE MEDICAL DEVELOPMENT, INC. & SUBSIDIARY
Consolidated Statement of Operations
Six Months and Quarters ended October 31, 1998 and 1997
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Quarters ended Six months ended
Unaudited Unaudited Unaudited Unaudited
1998 1997 1998 1997
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<S> <C> <C> <C> <C>
Net Sales $ 3,182,869 $ 4,762,624 6,825,107 8,589,007
Cost of Sales 2,315,735 3,722,379 5,013,587 6,559,742
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Gross profit 867,134 1,040,245 1,811,520 2,029,265
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General and administrative expenses 283,520 339,781 550,150 709,127
Selling expenses 212,474 470,223 532,172 806,024
Research, development and engineering 37,827 37,421 73,177 63,595
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533,821 847,425 1,155,499 1,578,746
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Income from operations 333,313 192,820 656,021 450,519
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Other income (expense)
Interest expense (114,066) (160,289) (241,355) (327,818)
Miscellaneous income (expense) 21,359 9,066 43,881 4,743
Amortization (48,164) (75,383)
Gain (loss) on asset disposal (3,294) 9,082 (1,057) 6,582
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Total other expense (96,001) (190,305) (198,531) (391,876)
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Income before income taxes 237,312 2,515 457,490 58,643
Provision for income taxes -- -- -- --
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Net income $ 237,312 $ 2,515 $ 457,490 $ 58,643
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Net income per basic common share $ 0.05 $ 0.00 $ 0.09 $ 0.01
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Weighted average common shares outstanding 5,109,152 5,530,563 5,302,098 5,538,486
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The Company's Common Stock and Warrants are traded over the counter on the
Electronic Bulletin Board of NASD under the symbols CMDI and CMDIW,
respectively.
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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.
Date: November 24 1998 Creative Medical Development, Inc.
By: /s/ William E. Cook
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William E. Cook, Chairman
