-----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, C9ukB9NfiAhTvmz5o3U3Yu/O0O31g+nSYhaQFQBGgfFkqwM9n/sUuZ1+M7TjSwAk v0pR9B7pbzyrDriAfKUhZg== 0000950134-03-015213.txt : 20031113 0000950134-03-015213.hdr.sgml : 20031113 20031113160404 ACCESSION NUMBER: 0000950134-03-015213 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030930 FILED AS OF DATE: 20031113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERWEST MEDICAL CORP CENTRAL INDEX KEY: 0000717197 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SKILLED NURSING CARE FACILITIES [8051] IRS NUMBER: 751864474 STATE OF INCORPORATION: OK FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-11881 FILM NUMBER: 03998180 BUSINESS ADDRESS: STREET 1: 3221 HULEN ST STE C STREET 2: ARLINGTON HEIGHTS PROFESSIONAL OFF BLDG CITY: FORT WORTH STATE: TX ZIP: 76107-6193 BUSINESS PHONE: 8177312743 MAIL ADDRESS: STREET 1: 3221 HULEN STREET STREET 2: STE C CITY: FORT WORTH STATE: TX ZIP: 76107-6193 FORMER COMPANY: FORMER CONFORMED NAME: SURGERY CENTERS CORP DATE OF NAME CHANGE: 19850808 10-Q 1 d10594e10vq.txt FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 - -------------------------------------------------------------------------------- FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended September 30, 2003 Commission File No. 2-82655 INTERWEST MEDICAL CORPORATION ----------------------------- (Exact name of registrant as specified in its charter) Oklahoma 75-1864474 ---------------------------- ------------------------------------ (State or other jurisdiction (I.R.S. Employer Identification No.) of incorporation or organization)
Arlington Heights Professional Office Building 3221 Hulen Street, Suite C, Fort Worth, TX 76107-6193 ----------------------------------------------------- (Address of principal executive offices, zip code) Registrant's telephone number, including area code: (817)731-2743 Not Applicable -------------------------------------------------------- (Former name, former address, and former fiscal year, if changed since last report) 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. Yes X No APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS: Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. (Not Applicable) Yes X No Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act) Yes No X (APPLICABLE TO CORPORATE ISSUERS) Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the close of the period covered by this report. 15,915,211 shares of Common Stock, $0.001 Par Value. INTERWEST MEDICAL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, December 31, 2003 2002 ---- ---- (Unaudited) ASSETS CURRENT ASSETS Cash ................................................ $ 442,517 $ 1,004,795 Accounts receivable - trade ......................... 3,569,977 2,783,978 Investments - trading ............................... 334,649 186,606 Prepaid expenses and other receivables .............. 698,846 530,505 ----------- ----------- Total current assets ............................ 5,045,989 4,505,884 PROPERTY AND EQUIPMENT, at cost Land ................................................ 294,354 294,354 Buildings and improvements .......................... 3,962,104 3,960,924 Equipment and furniture ............................. 1,420,938 1,389,927 Oil and gas properties (successful efforts method of accounting) ......... 170,489 170,489 ----------- ----------- 5,847,885 5,815,694 Less accumulated depreciation and depletion ......... 2,692,900 2,480,107 ----------- ----------- 3,154,985 3,335,587 OTHER ASSETS Cash escrow accounts ................................ 191,700 40,025 Deferred financing costs, net ....................... 53,340 349,320 ----------- ----------- 245,040 389,345 ----------- ----------- TOTAL ASSETS .......................................... $ 8,446,014 $ 8,230,816 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current maturities of long-term debt ................ $ 40,940 $ 50,898 Accounts payable .................................... 2,106,007 2,077,100 Accrued expenses .................................... 583,060 645,766 ----------- ----------- Total current liabilities ....................... 2,730,007 2,773,764 LONG-TERM DEBT ........................................ 4,577,160 4,293,990 STOCKHOLDERS' EQUITY Common stock, par value $0.001, authorized 50,000,000 shares, issued 22,000,000 shares ....... 22,000 22,000 Additional paid-in capital .......................... 5,096,745 5,096,745 Retained earnings (deficit) ......................... (2,927,664) (2,903,474) ----------- ----------- 2,191,081 2,215,271 Less cost of shares held in the treasury, 2003 - 6,084,789 shares; 2002 - 6,084,289 shares .. 892,234 892,209 Notes receivable - officer .......................... 160,000 160,000 ----------- ----------- 1,138,847 1,163,062 ----------- ----------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ............ $ 8,446,014 $ 8,230,816 =========== ===========
See Accompanying Notes to Condensed Consolidated Financial Statements INTERWEST MEDICAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
Three Months Ended Nine Months Ended September 30, September 30, ------------- ------------- 2003 2002 2003 2002 ---- ---- ---- ---- REVENUES Patient service revenue ............................. $ 4,249,385 $ 3,427,712 $ 11,672,121 $ 9,877,906 Other revenue ....................................... 13,518 7,922 36,150 45,313 ------------ ------------ ------------ ------------ Total revenue ................................... 4,262,903 3,435,634 11,708,271 9,923,219 COSTS AND EXPENSES Professional care of patients ....................... 2,381,610 2,080,319 6,921,145 5,880,830 General services .................................... 713,921 685,016 2,091,087 1,946,650 Administrative services ............................. 778,935 467,394 2,032,345 1,468,317 Other costs ......................................... 3,702 5,317 12,614 21,425 Depreciation, depletion and amortization ............ 70,931 68,149 212,793 198,758 ------------ ------------ ------------ ------------ Income (loss) from operations ................... 313,804 129,439 438,287 407,239 OTHER INCOME (EXPENSES) Interest income ..................................... 707 4,334 3,101 17,232 Other Financing Costs ............................... (349,320) -- (349,320) -- Expense ............................................. (82,594) (85,466) (243,794) (233,782) Investment income (loss) ............................ 55,810 (662,347) 127,536 (1,256,183) ------------ ------------ ------------ ------------ Income (loss) before taxes on income (loss) ..... (61,593) (614,040) (24,190) (1,065,494) Provision for income taxes ............................ -- -- -- -- ------------ ------------ ------------ ------------ Net income (loss) ............................... ($ 61,593) ($ 614,040) ($ 24,190) ($ 1,065,494) ============ ============ ============ ============ Weighted averages shares outstanding .................. 15,915,544 15,917,411 15,915,675 15,919,605 ============ ============ ============ ============ Earnings (loss) per common share - basic and diluted .. ($ 0.00) ($ 0.04) ($ 0.00) ($ 0.07) ============ ============ ============ ============
See Accompanying Notes to Condensed Consolidated Financial Statements INTERWEST MEDICAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine Months Ended ----------------- September 30, September 30, 2003 2002 ---- ---- CASH FLOWS FROM OPERATING ACTIVITIES ..................... ($ 652,982) ($ 80,528) CASH FLOWS FROM INVESTING ACTIVITIES Payments for acquisition of property ................... (32,191) (174,177) Net changes in escrow accounts ......................... 151,675 (9,603) Proceeds from sale of property and equipment ........... -- 14,000 ----------- ----------- Net cash provided by (used in) investing activities .. 119,484 (169,780) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings ............................... 14,705 -- Purchase of treasury stock ............................. (25) (770) Payments on borrowings ................................. (43,460) (49,617) ----------- ----------- Net cash provided by (used in) financing activities .. (28,780) (50,387) ----------- ----------- Net increase (decrease) in cash ...................... (562,278) (300,695) CASH, beginning of period ................................ 1,004,795 1,412,024 ----------- ----------- CASH, end of period ...................................... $ 442,517 $ 1,111,329 =========== ===========
See Accompanying Notes to Condensed Consolidated Financial Statements INTERWEST MEDICAL CORPORATION NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS 1. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the Company's financial position as of September 30, 2003, and its results of operations for the three and nine months ended September 30, 2003 and 2002, and cash flows for the nine months ended September 30, 2003 and 2002. The results of operations for the period presented are not necessarily indicative of the results to be expected for a full year. 2. Income (loss) per share was computed by dividing the net income (loss) by the weighted average number of shares outstanding. 3. The Company has adopted a Stock Option Plan which provides for the granting of options to officers and other key employees for the purchase of common stock of the Company. The Plan reserves 1,500,000 shares of common stock for the granting of such options. Options are subjected to adjustment upon any change in the capital structure of the Company such as a stock dividend, stock split or other similar events. Options may be granted at not less than 100% of the fair market value of the Company stock at the date of grant, and are exercisable during a term of ten years from the date of grant at any time in whole or in part, and are subject to continued employment and other conditions as set forth in the option agreement. Options are exercisable only by the participants and are not assignable during their lifetime and must be exercised within one year of the death of the participant by his legal representative. A summary of the status of the Company's stock options for 2003 and 2002 is as follows:
2003 2002 ---- ---- Weighted Weighted Average Average Shares Exercise Shares Exercise (000) Price (000) Price ----- ----- ----- ----- Outstanding, beginning 1,500 .15 1,500 $ .15 Granted -- -- -- -- Exercised -- -- -- -- Forfeited -- -- -- -- -------- -------- -------- -------- Outstanding, ending 1,500 .15 1,500 $ .15 ======== ======== ======== ======== Options exercisable at year end 1,500 $ .15 1,500 $ .15 ======== ======== ======== ======== Weighted average fair value of options granted during the year $ -- $ -- ======== ========
At September 30, 2003, the 1,500,000 options have an exercise price of $0.15 per share and a weighted average remaining contractual life of 6.50 years. 4. In August, 2003, the company refinanced its long term debt based upon the current favorable financing and interest rate environment. All financing costs capitalized on its previous debt were charged to operations and is included in the accompanying financial statements as other financing costs. REVIEW BY INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS Weaver and Tidwell, L.L.P., Independent Certified Public Accountants, have performed a review of the condensed consolidated balance sheet as of September 30, 2003 and the condensed consolidated statements of operations for the three and nine months ended September 30, 2003 and 2002, and cash flows for the nine months ended September 30, 2003 and 2002, in accordance with established professional standards and procedures for such a review. All adjustments or additional disclosures proposed by Weaver and Tidwell, L.L.P. have been reflected in the data presented. The report of Weaver and Tidwell, L.L.P. commenting upon their review is included as Part I - Exhibit I. INDEPENDENT ACCOUNTANT'S REVIEW REPORT To the Board of Directors InterWest Medical Corporation We have reviewed the condensed consolidated balance sheet of InterWest Medical Corporation as of September 30, 2003, and the related condensed consolidated statements of operations for the three and nine month periods ended September 30, 2003 and 2002, and cash flows for the nine months ended September 30, 2003 and 2002. 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 review procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit 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 accompanying interim condensed consolidated financial statements referred to above, for them to be in conformity with accounting principles generally accepted in the United States of America. We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of InterWest Medical Corporation as of December 31, 2002, and the related consolidated statements of operations, stockholders' equity and cash flows for the year then ended (not presented herein); and in our report dated February 24, 2003, 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, 2002, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived. /s/ WEAVER AND TIDWELL, L.L.P. WEAVER AND TIDWELL, L.L.P. Fort Worth, Texas November 10, 2003 657 PART I - EXHIBIT I Item 2. Management's Discussion and Analysis of Financial Position and Results of Operations. Changes in Balance Sheet Accounts Current assets were $5,045,989 and total assets were $8,446,014 at September 30, 2003 as compared to $4,505,884 current assets and $8,230,816 total assets at December 31, 2002. Current liabilities were $2,730,007 at September 30, 2003 as compared to $2,773,764 at December 31, 2002. Results of Operations For the three months ended September 30, 2003, operating revenue was $4,262,903; costs and expenses were $3,949,099 net loss was ($61,593) and interest income was $707, as compared to the three months ended September 30, 2002, operating revenue of $3,435,634, costs and expenses of $3,306,195, net loss was ($614,040) and interest income of $4,334. For the nine months ended September 30, 2003, operating revenue was $11,708,271, costs and expenses were $11,269,984, net loss was ($24,190) and interest income was $3,101, as compared to the nine months ended September 30, 2002, operating revenue of $9,923,219, costs and expenses of $9,515,980, net loss of ($1,065,494) and interest income of $17,232. Cash Flows For the nine months ended September 30, 2003, cash flows from operating activities were ($652,982), cash flows from investing activities were $119,484, cash flows from financing activities were ($28,780) net decrease in cash was ($562,278), cash at the beginning of the period was $1,004,795, and cash at the end of the period was $442,517 as compared to the nine months ended September 30, 2002, to cash flows from operating activities of ($80,528), cash flows from investing activities of ($169,780), cash flows from financing activities of ($50,387), net decrease in cash of ($300,695), cash at the beginning of the period of $1,412,024 and cash at the end of the period of $1,111,329. Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company has not entered into any derivative financial instruments, derivative commodity instruments or other similar instruments during the quarter ended September 30, 2003. Item 4. Controls and Procedures As of September 30, 2003, an evaluation was performed under the supervision and with the participation of the Company's management, including the CEO, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on that evaluation, the Company's management, including the CEO, concluded that the Company's disclosure controls and procedures were effective as of September 30, 2003. There have been no significant changes in the Company's internal controls or in other factors that could significantly affect internal controls subsequent to September 30, 2003. Liquidity The company has not experienced any substantial changes in liquidity during the current year. At December 31, 2002 current assets exceeded current liabilities by $1,732,120. Current assets exceed current liabilities by $2,315,982 at September 30, 2003. PART II. OTHER INFORMATION Item 1. Legal Proceedings. Not applicable. Item 2. Changes in Securities. Not applicable. Item 3. Defaults upon Senior Securities. Not applicable. Item 4. Submission of Matters to a Vote of Securities Holders. Not applicable. Item 5. Other Information Not applicable. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibit 31 - Section 302 Certification Exhibit 32 - Section 906 Certification SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its half by the undersigned thereunto duly authorized. INTERWEST MEDICAL CORPORATION By: /s/ ARCH B. GILBERT ------------------------------------- Arch B. Gilbert, President, Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer Date: November 11, 2003 EX-31 3 d10594exv31.txt SECTION 302 CERTIFICATION EXHIBIT 31 CERTIFICATION Pursuant to 18 U.S. C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 I, Arch B. Gilbert, certify that: 1. I have reviewed this quarterly report on Form 10-Q of InterWest Medical Corporation; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have: a. designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this quarterly report is being prepared; b. evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c. presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on my evaluation as of the Evaluation Date. 5. I have disclosed, based on my most recent evaluation, to the registrant's auditors and the Audit Committee of the Company's Board of Directors: a. all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b. any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of my most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. /s/ ARCH B. GILBERT November 11, 2003 - ---------------------------------------- Arch B. Gilbert President, Chief Executive Officer and Chief Financial Officer EX-32 4 d10594exv32.txt SECTION 906 CERTIFICATION EXHIBIT 32 INTERWEST MEDICAL CORPORATION CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (18 USC 1350) The undersigned, Arch B. Gilbert, the Chief Executive Officer and Chief Financial Officer of InterWest Medical Corporation (the Company), has executed this Certification in connection with the filing with the Securities and Exchange Commission of the Company's current report on Form 10-Q (the "Report"). The undersigned hereby certifies that: - - the Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and - - the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. IN WITNESS WHEREOF, the undersigned has executed this Certification as of the 11th day of November 2003. /s/ ARCH B. GILBERT - --------------------------------------- Arch B. Gilbert President, Chief Executive Officer and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----