-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WTRJXx6ZmJ3Fm9FIlVQulKN2clNNv87mPchoSLEqq78NPTYAtL4yEDcu4YoBDAek uqKuLBURG0BtJuhodde1Uw== 0000910680-00-000582.txt : 20000922 0000910680-00-000582.hdr.sgml : 20000922 ACCESSION NUMBER: 0000910680-00-000582 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 DATE AS OF CHANGE: 20000829 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN MEDICAL ALERT CORP CENTRAL INDEX KEY: 0000700721 STANDARD INDUSTRIAL CLASSIFICATION: 7380 IRS NUMBER: 112571221 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 001-08635 FILM NUMBER: 701644 BUSINESS ADDRESS: STREET 1: 3265 LAWSON BLVD CITY: OCEANSIDE STATE: NY ZIP: 11572 BUSINESS PHONE: 5165365850 MAIL ADDRESS: STREET 1: 3265 LAWSON BLVD CITY: OCEANSIDE STATE: NY ZIP: 11572 10QSB 1 0001.txt FORM 10QSB FOR AMERICAN MEDICAL ALERT FORM 10-QSB SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended June 30, 2000 Commission File Number 1-8635 AMERICAN MEDICAL ALERT CORP. (Exact Name of Small Business Issuer as Specified in its Charter) New York 11-2571221 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 3265 Lawson Boulevard, Oceanside, New York 11572 (Address of principal executive offices) (Zip Code) (516) 536-5850 (Issuer's telephone number, including area code) Check whether the issuer (1) 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. 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: 6,415,241 shares of $.01 par value common stock as of August 10, 2000. AMERICAN MEDICAL ALERT CORP. INDEX PART I. FINANCIAL INFORMATION
PAGE Item 1. Financial Statements. Report of Independent Accountants 1 Condensed Consolidated Balance Sheets for June 30, 2000 2 and December 31, 1999 Condensed Consolidated Statements of Income for the 3 Six Months Ended June 30, 2000 and 1999 Condensed Consolidated Statements of Income for the 4 Three Months Ended June 30, 2000 and 1999 Condensed Consolidated Statements of Cash Flows for 5 the Six Months Ended June 30, 2000 and 1999 Notes to Condensed Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of 8 Financial Condition and Results of Operations. PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security-Holders. 12 Item 6. Exhibits and Reports on Form 8-K. 12
REPORT OF INDEPENDENT ACCOUNTANTS Board of Directors and Shareholders American Medical Alert Corp. and Subsidiary Oceanside, New York We have reviewed the condensed consolidated balance sheet of American Medical Alert Corp. and Subsidiary as of June 30, 2000 and the related condensed consolidated statements of income for the three-month and six-month periods then ended and cash flows for the six month period then ended. These financial statements are the responsibility of the company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet as of December 31, 1999, and the related consolidated statements of income, shareholders' equity and cash flows for the year then ended (not presented herein); and in our report dated February 17, 2000 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 1999, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. The accompanying condensed consolidated statements of income for the three-month and six month period ended June 30, 1999 and cash flows for the six-months ended June 30, 1999 of American Medical Alert Corp. and Subsidiary were not audited (or reviewed) by us, and accordingly, we do not express an opinion (or any other form of assurance) on them. August 10, 2000 /s/Margolin, Winer & Evens LLP -1- PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS. AMERICAN MEDICAL ALERT CORP. CONDENSED CONSOLIDATED BALANCE SHEETS ASSETS
June 30,2000 December 31,1999* (Unaudited) ----------------- ----------- CURRENT ASSETS: Cash $ 308,468 $ 953,734 Accounts and notes receivable (net of allowance for doubtful accounts of $75,000) 2,718,621 2,255,640 Inventory 588,480 791,572 Prepaid expenses and other current assets 623,147 342,548 Deferred income tax benefit 156,000 156,000 --------- --------- Total Current Assets $4,394,716 $4,499,494 INVENTORY OF MEDICAL DEVICES HELD FOR LEASE-AT COST 1,371,420 988,000 FIXED ASSETS: (Net of accumulated depreciation and amortization) 6,683,345 5,503,347 OTHER ASSETS 1,177,257 393,680 --------- --------- TOTAL ASSETS $13,626,738 $11,384,521 ----------- ----------- LIABILITIES AND SHAREHOLDER'S EQUITY CURRENT LIABILITIES: Accounts payable $ 726,072 $ 305,320 Accrued expenses 386,413 242,373 Current portion of long-term debt 259,554 98,801 --------- --------- Total Current Liabilities 1,372,039 646,494 DEFERRED INCOME TAX LIABILITY 436,000 423,000 DEFERRED INCOME 11,766 17,166 LONG-TERM DEBT - LESS CURRENT MATURITIES 1,539,798 282,686 --------- --------- Total Liabilities 3,359,603 1,369,346 COMMITMENTS AND CONTINGENT LIABILITIES SHAREHOLDERS' EQUITY Preferred stock, $ .01 par value - authorized, 1,000,000 shares; none issued and outstanding Common stock - $.01 par value; authorized - 20,000,000 shares in 2000 and 10,000,000 shares in 1999; issued 6,458,021 shares in 2000 and 6,446,832 shares in 1999. $ 64,580 $ 64,468 Additional paid-in capital 6,226,895 6,200,701 Retained earnings 4,081,692 3,856,038 --------- --------- 10,373,167 10,121,207 Less 43,910 shares of treasury stock, at cost ( 106,032) (106,032) --------- --------- Total Shareholders' Equity 10,267,135 10,015,175 --------- --------- TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $13,626,738 $11,384,521 ----------- -----------
See accompanying notes to condensed financial statements. * Derived from audited financial statements -2- AMERICAN MEDICAL ALERT CORP. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Six Months Ended June 30, ------------------------- 2000 1999 ---- ---- Revenues: Services $4,917,073 $4,296,790 Product Sales 188,164 158,892 ---------- ---------- 5,105,237 4,455,682 Cost and Expenses (Income): Costs related to services 2,110,920 1,610,561 Costs of products sold 145,834 151,593 Selling, general and administrative expenses 2,439,241 1,835,813 Interest expense 38,075 9,901 Other income (16,487) (13,258) ---------- ---------- 4,717,583 3,594,610 ---------- ---------- Income before Provision for Income Taxes 387,654 861,072 Provision for Income Taxes 162,000 371,000 ---------- ---------- NET INCOME $ 225,654 $490,072 ========= ========= Net Income per Share: Basic $ .04 $ .08 ---------- ---------- Diluted $ .04 $ .08 ---------- ---------- Weighted average number of common shares outstanding (Note 3): Basic 6,410,584 6,371,601 ========= ========= Diluted 6,415,317 6,510,911 ========= =========
See accompanying notes to condensed financial statements -3- AMERICAN MEDICAL ALERT CORP. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three months Ended June 30, --------------------------- 2000 1999 ---- ---- Revenues: Services $ 2,527,899 $ 2,182,117 Product Sales 106,734 77,508 ----------- ----------- 2,634,633 2,259,625 Cost and Expenses (Income): Costs related to service 1,115,526 806,292 Costs of products sold 92,456 73,148 Selling, general and administrative expenses 1,303,670 948,549 Interest expense 23,768 4,386 Other income (7,575) (5,731) ----------- ----------- 2,526,845 1,826,644 ----------- ----------- Income before Provision for Income Taxes 106,788 432,980 Provision for Income Taxes 44,000 183,000 ----------- ----------- NET INCOME $ 62,788 $249,980 ----------- ----------- Net Income per Share Basic $ .01 $ .04 ----------- ----------- Diluted $ .01 $ .04 ----------- ----------- Weighted average number of common shares outstanding (Note 3): Basic 6,414,111 6,377,922 ----------- ----------- Diluted 6,414,111 6,420,739 ----------- -----------
See accompanying notes to condensed financial statements. -4- AMERICAN MEDICAL ALERT CORP. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
Six Months Ended June 30, ------------------------ 2000 1999 Cash Flows from Operating Activities: Net income $ 225,654 $ 490,072 Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 831,554 582,606 Loss on unrecovered leased medical equipment 56,150 58,772 Change in Assets and Liabilities: (Increase) Decrease in receivables (462,981) 141,420 (Increase) Decrease in inventory 203,092 (540,313) Increase in prepaid expenses, deferred taxes and other assets (249,470) (253,659) Increase in accounts payable, accrued expenses, taxes payable and deferred income 510,193 256,199 ---------- ---------- Net Cash Provided by Operating Activities 1,114,192 735,097 Cash Flows from Investing Activities: Net expenditures for fixed assets (2,429,381) (1,180,180) Proceeds from sale and leaseback of equipment 250,179 -0- Payment for account acquisitions (353,011) -0- Increase in notes receivable (285,737) (65,000) ---------- ---------- Net Cash Used In Investing Activities (2,817,950) (1,245,180) Cash Flows from Financing Activities: Increase in notes payable - bank 1,100,000 -0- Proceeds from (repayment of) loans payable and capital lease obligations (67,814) 9,117 Proceeds upon exercise of stock options 26,306 62,143 ---------- ---------- Net Cash Provided by Financing Activities 1,058,492 71,260 Net Decrease in Cash (645,266) (438,823) Cash, Beginning of Period 953,734 1,419,842 ---------- ---------- Cash, End of Period $ 308,468 $ 981,019 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 38,075 $ 9,901 ---------- ---------- Income Taxes $ 231,606 $ 319,780 ---------- ----------
See accompanying notes to condensed financial statements -5- AMERICAN MEDICAL ALERT CORP. Notes to Condensed Consolidated Financial Statements (Unaudited) 1. General: These financial statements should be read in conjunction with the financial statements and notes thereto for the year ended December 31, 1999 included in the Company's Annual Report on Form 10-KSB. 2. Results of Operations: In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial position as of June 30, 2000, and the results of operations and cash flows for the six and three months ended June 30, 2000 and 1999. The accounting policies used in preparing these financial statements are the same as those described in the December 31, 1999 financial statements. The results of operations for the six and three months ended June 30, 2000 are not necessarily indicative of the results to be expected for any other interim period or for the full year. 3. Earnings Per Share In February 1997, the Financial Accounting Standards Board issued SFAS No. 128, "Earnings per Share" which changes the methodology of calculating earnings per share. SFAS No. 128 requires the disclosure of diluted earnings per share regardless of its difference from basic earnings per share. The Company adopted SFAS No. 128 in December 1997. Earnings per share data for the six and three months ended June 30, 2000 and 1999 is presented in conformity with this pronouncement. The following table is a reconciliation of the numerators and denominators in computing earnings per share: -6-
Six Months Ended June 30, 2000 Income Shares Per-Share - - - ------------------------------ (Numerator) (Denominator) Amounts ----------- ------------- ------- Basic EPS - Income available to common stockholders Effect of dilutive securities - $ 225,654 6,410,584 $.04 Options and warrants ==== Diluted EPS - Income available to common -0- 4,733 stockholders and assumed ----------- --------- converstions $ 225,654 6,415,317 $.04 =========== ========= ==== Three Months Ended June 30, 2000 - - - -------------------------------- Basic EPS - Income available to common stockholders $ 62,788 6,414,111 $.01 Effect of dilutive securities - Options and warrants -0- -0- Diluted EPS - Income available to ------------ --------- ===== common stockholders and assumed conversions $ 62,788 6,414,111 $.01 ------------ --------- ===== Six months Ended June 30, 1999 - - - ------------------------------ Basic EPS -Income available to common stockholders $ 490,072 6,371,601 $.08 Effect of dilutive securities - Options and warrants -0- 139,310 Diluted EPS -Income available to --------------- --------- common stockholders and assumed conversions $ 490,072 6,510,911 $.08 =============== ========= ==== Three Months Ended June 30, 1999 - - - -------------------------------- Basic EPS - Income available to common stockholders $ 249,980 6,377,922 $.04 Effect of dilutive securities - Options and warrants -0- 42,817 Diluted EPS -Income available to --------------- --------- ==== common stockholders and assumed conversions $ 249,980 6,420,739 $.04 --------------- --------- ====
-7- 4. Major Customers: The Company is an approved Medicaid Provider in the states of New York, Georgia and Illinois, amongst others. During the three months and six months ended June 30, 2000 and 1999 the Company had revenue from a contract with the City of New York, Human Resources Administration, Home Care Services Program (HCSP) which represented, respectively, 36% of total revenue in the 2000 periods and 46% of total revenue in the 1999 periods. The contract was effective through June 30, 1999. In January 1999, the Company submitted its proposal to HCSP to renew and extend the contract. Since June 30, 1999, the Company has continued to provide service while awaiting its selection of a provider, and as of August 11, 2000, the contract had not been awarded. The Company has had various communications with HCSP with respect to the contract, as described below under the section "Liquidity and Capital Resources" of Management's Discussion and Analysis. Even if the Company does receive the renewal of the contract, there can be no assurance that the same level of revenues will be sustained due to a variety of factors including pricing, number of subscribers to be serviced, the competitive nature of the bid process, and the amount of time that passes before the renewal agreement is acted upon by the municipality. Depending on how HCSP may award the renewal of the agreement, pricing on an individual subscriber basis may be lower than current levels. If HCSP does not renew the contract, a significant amount of the Company's revenue would be lost, which would have a material adverse effect on operating results, and in addition, there most likely would be a significant write-down of the Company's leased medical devices (and/or a reduction in their remaining useful lives) and medical devices held for lease. The extent of the write down will be dependent upon the length of the transition period to the new provider. As of June 30, 2000 and December 31, 1999 accounts receivable from the contract represented 62% of accounts receivable and leased medical devices in service under the contract represented 35% and 38%, respectively, of leased medical devices. In addition, inventory relating to this contract represents approximately 20% of total inventory on hand at June 30, 2000 and December 31, 1999, respectively. At June 30, 2000 the Company has incurred legal and other fees of approximately $218,000 relating to the contract extension. Such costs have been classified as deferred costs and will be amortized over the new contract term or written off if the contract is not renewed. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of the Company's results of operations and financial condition. The discussion should be read in conjunction with the consolidated financial statements contained in the latest Annual Report dated December 31, 1999. This discussion contains forward-looking statements which, in addition to assuming a continuation of the degree and timing of customer utilization and rate of renewals of contracts with the Company at historical levels, are subject to a number of known and unknown risks that, in addition to general economic, competitive and other business conditions, could cause actual results, performance and achievements to differ materially from those described or implied in the forward-looking statements. LIQUIDITY AND CAPITAL RESOURCES - - - ------------------------------- The Company has amended, subject to formal documentation, its Revolving Credit Facility (the "Facility"). The Facility, which will expire on May 31, 2002, was increased to $2,500,000 -8- (based upon 75% of eligible accounts receivable and 50% of inventory, as defined in the agreement with respect to the Facility). Borrowings under the Facility bear interest at the lower of the prime rate or the LIBOR Rate plus 2.50% and are collateralized by the Company's assets. There is $1,100,000 and $1,300,000 outstanding under the Facility as of June 30, 2000 and August 10, 2000, respectively. The agreement with respect to the Facility provides for negative and affirmative covenants including those related to tangible net worth, working capital and other borrowings. At December 31, 1999 there were no amounts outstanding under the Facility. The Company's working capital on June 30, 2000 was $3,022,677 as compared to $3,853,000 on December 31, 1999. During 2000, the Company anticipates that it will make capital investments of approximately $4,000,000 of which approximately $2,400,000 was expended during the six months ended June 30, 2000. Of the amount expended in the first six months approximately $2,000,000 was used for the design, production and purchase of additional systems that the Company intends to rent. The balance of $400,000 has been used primarily for the enhancement of management information systems. During the six months ended June 30, 2000, the Company made a secured loan of $300,000 to a provider agency to assist that agency with the expansion of its PERS business. In addition, as part of the Company's acquisition strategy, the Company paid $353,000 during the six months ended June 30, 2000 to purchase and/or convert to its systems, various local and national provider agencies. The Company believes that its present cash and working capital position, its borrowing availability and future anticipated income will be sufficient to meet its cash and working capital needs for the foreseeable future. The Company derives a significant portion of its revenue from one contract with the City of New York's Human Resources Administration (HRA), Medicaid Homecare Services Program (HCSP). During the three months and six months ended June 30, 2000 and 1999, the Company had revenue from this contract, which represented 36% of total revenue in the 2000 periods and 46% of total revenue in the 1999 periods. As of June 30, 2000 and December 31, 1999, accounts receivable from the contract represented 62% of accounts receivable. Leased medical devices in service relating to this contract represented 35% and 38% of total leased medical devices at June 30, 2000 and December 31, 1999, respectively. Inventory relating to this contract represented approximately 20% of total inventory on hand at June 30, 2000 and December 31, 1999, respectively. The contract with HCSP expired on June 30, 1999 and the Company continues to service New York City's Medicaid Homecare Services Program (HCSP) under the terms and conditions of the contract that expired. In January 1999, the Company and several other companies submitted proposals to provide PERS services on behalf of the City of New York through June 30, 2003. On October 22, 1999, the Company was advised by HCSP that another vendor had been preliminarily recommended. The Company's management reviewed HCSP's preliminary recommendation and assessed alternative options and courses of action. On November 1, 1999, the Company submitted a formal protest pursuant to paragraph 4-04 of the Rules of the Procurement Policy Board of the City of New York to contest the preliminary award. In July, the Agency's Chief Contracting Officer advised the Company that the award had not yet been made. It was further stated that this protest had not persuaded the Agency to not award the contract to the other vendor. The Company, believing in the merit of its protest appealed this determination in accordance with the procurement rules relating to the contract to the Commissioner of HRA. On August 9, 2000, the -9- Company received notification from the Commissioner of HRA that the appeal of the determination of the Agency's Chief Contracting Officer was denied. The Company continues to believe in the merit of its protest and is evaluating all possible options in connection with this most recent notification. As of August 11, 2000, the contract had not been awarded. The Company continues as the current vendor and current revenues and the current subscriber base relating to this agreement have increased slightly since the levels achieved in the 2nd quarter of 1999. If the HCSP awards the contract to another vendor, approximately 36% of the Company's revenues would be lost, having a material adverse effect on operating results and cash flows. In addition, it is possible that significant adjustments to inventory and fixed assets associated with the contract would occur. Based upon a transition method selected by HCSP, it could be expected that revenues from HCSP would continue on a diminishing scale until all units are removed. However, at this time, no determination can be made on how the transition to another vendor would be accomplished, and in what time frame the transition would be made, and thus the full financial impact cannot be assessed at this time. Even if the Company does receive the renewal of the contract, there can be no assurance that the same level of revenues will be sustained due to a variety of factors including pricing, number of subscribers to be serviced, the competitive nature of the bid process, and the amount of time that passes before the renewal agreement is acted upon by HCSP. Depending on how HCSP may award the renewal of the agreement, pricing on an individual subscriber basis may be lower than the current levels. In light of the possibility that the Company's contract with HCSP may not be renewed, the Company's management has developed a business plan to minimize the potential loss through reduction in HCSP related overhead and the re-deployment of assets to other programs. In addition, the Company focused on, and will continue to build its subscriber base through consumers, healthcare agencies, health maintenance organizations, durable medical equipment providers, retirement communities, hospitals and other governmental agencies. In addition, the Company is continuing to invest in new products, services, and initiatives. RESULTS OF OPERATIONS - - - --------------------- Revenue from services (recurring monthly revenues, RMR) increased $620,283 for the six months ended June 30, 2000 as compared to the same period in 1999, an increase of 14%, and increased $345,782 for the three months ended June 30, 2000 as compared to the same period in 1999, an increase of 16%. The Company has experienced success in growing its customer base outside the contract with the City of New York through a variety of marketing efforts that have continued to contribute to increasing RMR. In the first two quarters of fiscal year 2000, the Company has doubled its net new subscriber growth, independent of the City of New York contract, in comparison to fiscal year 1999. Costs related to services as a percentage of RMR for the six months ended June 30, 2000 and 1999 were 43% and 37%, and for the three months ended June 30, 2000 and 1999 were 44% and 37%, respectively. The increases in costs related to services resulted from increased depreciation of medical devices, additional response center personnel, enhancement of the Company's information systems and personnel, and increases in telecommunication costs resulting from the expansion of available services to subscribers. Revenue from product sales for the six months ended June 30, 2000 was $188,164, an increase -10- of $29,292 as compared to the same period in 1999. Revenue from product sales for the three months ended June 30, 2000 was $106,734, an increase of $29,226 as compared to the same period in 1999. Gross profit on product sales for the six months ended June 30, 2000 and 1999 was 23% and 5%, respectively. Gross profit on product sales for the three months ended June 30, 2000 and 1999 was 13% and 6%, respectively. Gross profit increased in 2000 as a result of the sale of the Company's new Model 450 Smart Activator and sales of the Company's products to retirement facilities, which are at higher profit margins. Selling, general and administrative expenses increased by $603,428 for the six months ended June 30, 2000 as compared to the same period in 1999, an increase of 33%. Selling, general, and administrative expenses as compared as a percentage of total revenues for the six months ended June 30, 2000 and 1999 were 48% and 41%, respectively. Selling, general and administrative expenses increased by $355,121 for the three months ended June 30, 2000 as compared to the same period in 1999, an increase of 37%. Selling, general, and administrative expenses as compared as a percentage of total revenues for the three months ended June 30, 2000 and 1999 were 49% and 42%, respectively. Additional expenses incurred in 2000 were the result of the hiring of executive and management personnel, expansion of the sales department, increased sales and marketing expenses, and start up costs associated with the development of the Company's new subsidiary, Safe Com, Inc. Interest expense for the six months ended June 30, 2000 and 1999 was $38,075 and $9,901, respectively. Interest expense for the three months ended June 30, 2000 and 1999 was $23,768 and $4,386, respectively. Interest in 2000 increased as a result of additional borrowings needed to fund inventory and equipment needs for new subscribers, management systems, and the start up of the Company's new subsidiary, Safe Com, Inc. The Company's income before provision for income taxes for the six months ended June 30, 2000 was $387,654, a decrease of $473,418 from 1999, or 55%. The Company's income before provision for income taxes for the three months ended June 30, 2000 was $106,788, a decrease of $326,192 from 1999, or 75%. The decrease in income before provision for income taxes in 2000 resulted from the factors noted above. -11- PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. The annual meeting of shareholders of the Company was held on June 28, 2000 for the purpose of: (i) electing five directors, (ii) approving the Company's 2000 Stock Option Plan, and (iii) approving an amendment to the Company's Articles of Incorporation to increase the number of authorized shares of common stock, par value $.01 per share ("Common Stock") of the Company from ten million shares to twenty million shares. 1. The following directors were elected by the following vote: For Withheld --- -------- Howard M. Siegel 5,902,422 209,937 Leonard Herz 5,404,142 669,217 Peter Breitstone 5,697,542 405,817 Theodore Simon 5,404,142 692,217 Frederic S. Siegel 5,404,142 638,137 2. The proposal to approve the Company's 2000 Stock Option Plan was approved by the following vote: For Against Abstain Not Voted ------------ ----------- --------------- --------- 2,117,982 1,428,464 56,670 2,812,125 3. The proposal to approve an amendment to the Company's Articles of Incorporation to increase the number of authorized shares of Common Stock of the Company from ten million to twenty million shares was approved by the following vote: For Against Abstain ---------- ------- ------- 5,632,660 432,561 195,388 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits: 27. Financial Data Schedule (b) Reports on Form 8-K: No reports on Form 8-K were filed. -12- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. AMERICAN MEDICAL ALERT CORP. Dated: August 11, 2000 By: /s/ Howard M. Siegel --------------------------------------- Howard M. Siegel President and Chief Operating Officer By: /s/ Corey M. Aronin --------------------------------------- Corey M. Aronin Chief Financial Officer -13- EX-27 2 0002.txt FINANCIAL DATA SCHEDULE
5 6-MOS DEC-31-2000 JAN-01-2000 JUN-30-2000 308,468 0 2,793,621 75,000 588,480 4,394,716 11,495,039 4,811,694 13,626,738 1,372,039 1,799,352 0 0 64,580 10,202,555 13,626,738 188,164 5,105,237 145,834 4,717,583 0 0 38,075 387,654 162,000 225,654 0 0 0 225,654 .04 .04
-----END PRIVACY-ENHANCED MESSAGE-----