-----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, K35sKOf3ECwmIMYyQoHiJHTlKnz1zEt0fQYJBTW68+yquUUH3zCjwOBElmC6PIj/ sFHDQE6IC2CbcZMHhl5snw== 0001035704-99-000569.txt : 19991115 0001035704-99-000569.hdr.sgml : 19991115 ACCESSION NUMBER: 0001035704-99-000569 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BIO MEDICAL AUTOMATION INC CENTRAL INDEX KEY: 0000812152 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 840922701 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-16335 FILM NUMBER: 99747175 BUSINESS ADDRESS: STREET 1: 7450 EAST JEWELL AVE STE A CITY: DENVER STATE: CO ZIP: 80231 BUSINESS PHONE: 3033680401 MAIL ADDRESS: STREET 1: 7450 E JEWELL AVE STREET 2: STE A CITY: DENVER STATE: CO ZIP: 80231 FORMER COMPANY: FORMER CONFORMED NAME: OZO DIVERSIFIED AUTOMATION INC /CO/ DATE OF NAME CHANGE: 19920703 10QSB 1 FORM 10QSB FOR QUARTER ENDING SEPTEMBER 30, 1999 1 FORM 10-QSB U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 (Mark One) [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1999 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT For the transition period from _________ to ________ Commission File No. 0-16335 BIO-MEDICAL AUTOMATION, INC. 7450 East Jewell Avenue, Suite A Denver, Colorado 80231 Telephone (303)-368-0401 Colorado 84-0922701 - ------------------------ ------------------------------------ (State of Incorporation) (IRS Employer Identification Number) Indicate by check mark whether the Issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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 [ ] As of September 30, 1999, Registrant had 643,128 shares of its $0.10 par value common stock outstanding. 2 PART I - FINANCIAL INFORMATION Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) BALANCE SHEETS
ASSETS September 30, 1999 December 31, 1998 ------------------ ----------------- (Unaudited) CURRENT ASSETS Cash $ 513,955 $ 8,150 Accounts receivable, net 8,150 -- Net assets of discontinued operations -- 116,901 ----------- ----------- Total Current Assets 522,105 125,051 ----------- ----------- PATENT COSTS 16,243 12,534 ----------- ----------- TOTAL ASSETS $ 538,348 $ 137,585 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY) CURRENT LIABILITIES Accounts payable and accrued expenses $ 81,310 $ 11,586 Current portion of long-term debt -- 130,000 Note payable - related parties -- 89,830 ----------- ----------- Total Current Liabilities $ 81,310 231,416 ----------- ----------- SHAREHOLDERS' EQUITY (DEFICIENCY) Preferred stock $0.10 par value, Authorized 1,000,000 shares, Issued - none Common stock, $0.10 par value, Authorized 5,000,000 shares, Issued and outstanding - 643,128 (1999), 643,160 (1998) 64,313 64,316 Capital in excess of par value 1,312,049 1,312,110 Accumulated deficit (919,324) (1,470,257) ----------- ----------- Total Shareholders' Equity (Deficiency) 457,038 (93,831) ----------- ----------- TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $ 538,348 $ 137,585 =========== ===========
See accompanying notes to the financial statements 2 3 Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) STATEMENT OF OPERATIONS (UNAUDITED)
Three Months Ended September 30, ------------------------------- 1999 1998 ------------ ----------- Revenue $ -- $ -- ---------- --------- Operating Expenses: General & Administrative 25,707 7,473 Research & Development -- 649 Interest -- 2,600 ---------- --------- (LOSS) FROM CONTINUING OPERATIONS (25,707) (10,722) ---------- --------- DISCONTINUED OPERATIONS Income from discontinued operations -- 14,379 ---------- --------- NET (LOSS) INCOME ($ 25,707) $ 3,657 ========== ========= INCOME (LOSS) PER COMMON SHARE - BASIC AND DILUTED Continuing operations ($ 0.04) ($ 0.02) Discontinued operations $ -- $ 0.03 ---------- --------- NET (LOSS) INCOME PER COMMON SHARE ($ 0.04) $ 0.01 ========== ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC 643,128 481,497 ========== =========
See accompanying notes to the financial statements 3 4 Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) STATEMENT OF OPERATIONS (UNAUDITED)
Nine Months Ended September 30, ------------------------------ 1999 1998 ---------- ----------- Revenue $ -- $ -- --------- --------- Operating Expenses: General & Administrative 126,804 53,648 Research & Development 2,302 10,947 Interest 4,420 6,802 --------- --------- (LOSS) FROM CONTINUING OPERATIONS (133,526) (71,397) --------- --------- DISCONTINUED OPERATIONS Income from discontinued operations 684,459 31,112 --------- --------- INCOME (LOSS) BEFORE TAXES 550,933 (40,285) INCOME TAX EXPENSE 215,000 -- TAX BENEFIT OF NET OPERATING LOSS CARRYFORWARDS (215,000) -- --------- --------- NET INCOME (LOSS) $550,933 ($ 40,285) ========= ========= INCOME (LOSS) PER COMMON SHARE - BASIC Continuing operations ($ 0.21) ($ 0.15) Discontinued operations $ 1.09 $ 0.07 --------- --------- NET INCOME (LOSS) PER COMMON SHARE $ 0.88 ($ 0.08) ========= ========= INCOME (LOSS) PER COMMON SHARE - DILUTED Continuing operations ($ 0.21) Discontinued operations $ 1.06 NET INCOME (LOSS) PER COMMON SHARE $ 0.85 ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC 643,128 478,164 ========= ========= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED 650,628
See accompanying notes to the financial statements 4 5 Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) STATEMENTS OF CASH FLOWS (UNAUDITED)
Nine months ended September 30, ------------------------------ 1999 1998 ----------- ---------- Cash flows from operating activities: Net Income (Loss) $ 550,933 $ 40,285 Adjustments to reconcile net income (loss)to net cash Used in operating activities: Decrease (increase) in assets: (Increase) in accounts receivable (8,150) -- Increase in accounts payable and accrued Expenses 69,726 -- Discontinued Operations: Operating cash (used) provided 116,103 (112,902) Depreciation & amortization 7,929 44,800 --------- --------- Net cash provided (used) by operating activities 736,541 (108,387) --------- --------- Cash flows from investing activities: Payments for patent costs (3,709) (6,421) --------- --------- Net cash (used) by investing activities (3,709) (6,421) --------- --------- Cash flows from financing activities: Proceeds from officer loan 40,000 213,200 Payments on officer loan (54,830) (134,590) Proceeds from director loan -- 75,000 Proceeds from issuance of common stock -- 5,500 Payments on common stock retired (64) -- Payments on director loan (75,000) -- Cash repayments by continuing operations (130,000) -- Cash repayments by discontinued operations (7,133) (44,302) --------- --------- Net cash (used) provided by financing activities (227,027) 114,808 --------- --------- Net increase in cash 505,805 -- Cash at beginning of period 8,150 -- --------- --------- Cash at end of period $ 513,955 $ -- ========= =========
See accompanying notes to the financial statements 5 6 Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) NOTES TO FINANCIAL STATEMENTS THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998 (UNAUDITED) The unaudited financial statements included herein were prepared from the records of the Company in accordance with Generally Accepted Accounting Principles and reflect all adjustments which are, in the opinion of Management, necessary to provide a fair statement of the results of operation and financial position for the interim periods. Such financial statements generally conform to the presentation reflected in the Company's Form 10-KSB filed with the Securities and Exchange Commission for the year ended December 31, 1998. The current interim period reported herein should be read in conjunction with the Company's Form 10-KSB. The results of operations for the three months and the nine months ended September 30, 1999, are not necessarily indicative of the results that may be expected for the year ending December 31, 1999. Note 1 - A summary of significant accounting policies is currently on file with the Securities and Exchange Commission on Form 10-KSB. 6 7 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS As a result of the completion of the sale of substantially all of the Company's assets to JOT Automation, Inc., in March 1999 (the "JOT Transaction"), the Company's historical business, the depaneling and routing business, is considered to be a "discontinued operation" and, consequently, provides no benefit to persons seeking to understand the Company's financial condition or results of operations. Consequently, this Management's Discussion and Analysis is divided into two parts: Discussion of Continuing Operations and Discussion of Discontinued Operations. Management believes that the discussion of continuing operations is more meaningful for a current understanding of the Company. DISCUSSION OF CONTINUING OPERATIONS - RESULTS OF OPERATIONS Substantially all of the Company's operations prior to the completion of the JOT Transaction were devoted to the Company's historical business. Only a small portion of the Company's general and administrative expense ($126,804 during 1999) and of the Company's research and development expense ($2,302 during 1999) were devoted to the assets the Company retained, relating to the technology for and the development of the prototype micro-robotic device. In addition, the Company's continuing operations accounted for approximately $4,420 of interest expense. Following the completion of the JOT Transaction, the Company retained certain intellectual property assets, which are potentially valuable for the development of a prototype micro-robotic device. This device had been under development by an officer of the Company, Mr. David Orthman, prior to the completion of the JOT Transaction and the Company expected that this development would continue after the JOT Transaction was completed. As discussed in other reports filed by the Company, a significant amount of work is required within certain specialized disciplines to complete the development of the prototype device. The development of the technology and the prototype device is primarily dependent on the efforts of David Orthman, formerly an officer and currently a director of the Company. Mr. Orthman has been unable to continue to work on the prototype device because of a disability that has surfaced since the completion of the JOT Transaction. Mr. Orthman has informed the Company that doctors have advised him that it will be six months or more before he will be able to devote any significant efforts to the technology or the prototype device. 7 8 As described in other reports filed by the Company, because of the uniqueness of the technology and other factors, there can be no assurance that the Company will be able to successfully develop the prototype even if Mr. Orthman is able to devote sufficient time to the project. Without the dedicated efforts of Mr. Orthman, it is unlikely that the Company will be able to complete the prototype device utilizing the technology. As a result, the Company has obtained an independent third party evaluation of the technology. The Company considers the results of this study to be positive and a ratification of the Company's decision to pursue the technology initially following the completion of the JOT Transaction. However, because of Mr. Orthman's continued unavailability, depleting working capital, and the passage of time, the Company is reconsidering this decision and is considering alternatives which may include a merger, or reverse acquisition, or a sale of the technology. It should be noted, however, that the Company has not made any determination to proceed on any alternative course and it has not identified any candidates for such action. The Company's continuing operations accounted for no revenues during the quarters ended September 30, 1999, or September 30, 1998, or the nine months ended September 30, 1999, or September 30, 1998. As a result of the small amount of operations devoted to the Company's continuing business, the Company recognized a net loss of $25,707 from its continuing operations in the quarter ended September 30, 1999, as compared to $10,722 in the quarter ended September 30, 1998. The Company recognized a net loss of $133,526 from its continuing operations for the nine months ended September 30, 1999, as compared to a net loss of $71,397 for the nine months ended September 30, 1998. The Company believes that this loss from continuing operations will continue to increase during 1999, and thereafter, until the prototype micro-robotic device has been developed and can be commercialized, or the Company otherwise becomes involved in a profitable enterprise, if ever. If the Company continues with the development of the prototype device, the Company originally expected to spend $600,000 for research and development and for general and administrative expenses through approximately June 2000. Because of the passage of time, the lack of progress due to Mr. Orthman's unavailability, and the Company's depleting working capital, the budget and the time frame are likely to increase significantly, making it less likely that the Company will be able to succeed in the completion of the research and development. If the Company elects not to proceed with the development of the prototype device, because of the unavailability of Mr. Orthman, or for other reasons, the Company will have to redefine its plan of operations, a process it has commenced. General and administrative expenditures will be directed to maintaining the Company's status as a public company, including (without limitation) filing reports with the Securities and Exchange Commission. 8 9 Even if the Company decides to continue the development of the prototype device, there can be no assurance that it will be able to do so with its remaining funds or expertise. Even if the Company is able to complete the prototype micro-robotic device, there can be no assurance that the device will be able to generate revenues for the Company. Unless the Company is able to generate revenues from (or after) the development of the prototype micro-robotic device and related technology, or from other activities if the Company determines not to proceed with the development of the prototype device, the Company's ability to continue as a going concern will be significantly impaired. As a result of the completion of the JOT Transaction, the Company has a significant amount of liquidity--approximately $441,000 as of September 30, 1999. The Company expects to spend this working capital to pursue its plan of operations, although the plan of operations may change significantly as future circumstances dictate. Unless the Company is able to generate revenues from (or after) the development of the prototype micro-robotic device and related technology, the Company's liquidity will erode until no amounts remain. Consequently, the Company's financial condition is entirely dependent on the successful development of the prototype micro-robotic device and related technology, of which there can be no assurance. 9 10 DISCUSSION OF DISCONTINUED OPERATIONS - RESULTS OF OPERATIONS For the nine months ended September 30, 1999, the Company had revenues of approximately $525,000, a 61% decrease from revenues of approximately $1,353,000, recorded for the first nine months of 1998. The decrease in revenues is primarily a result of no revenues being generated by discontinued operations in the second and third quarters of 1999. Since the Company sold its depaneling and routing business to JOT Automation, Inc., in the "JOT Transaction" as described elsewhere in this report, the Company no longer has any interest in continuing revenues from, or assets associated with, its former depaneling and routing business. 10 11 Year 2000 Compliance Although there can be no assurance, the company does not anticipate that it will suffer any adverse impact as a result of Year 2000 (Y2K) computer software issues either as a result of third party non-compliance or as a result of internal matters. None of the information technology or other software and hardware systems utilized by the Company incorporates technology that is incapable of recognizing dates beyond December 31, 1999. In making the foregoing determination, the Company has assessed embedded systems contained in its facility and manufacturing equipment. As a result, the Company has not established a contingency plan to come into effect in the event of a Y2K catastrophe and Management does not believe that such a plan is necessary. Of course, the Company is dependent on facilities outside of their control, such as electrical power supplies, banking facilities, transportation facilities (such as airlines) and communications facilities. While the Company believes, based on public reports and some notifications it has received, that these outside facilities are or will be Y2K compliant, the Company does not have any other basis for determining their compliance. The operations of the Company would be significantly and adversely affected if any of these facilities are adversely affected by the millennium and other issues related to Y2K. Except for historical information contained herein, the statements in this report are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to differ materially, from forecasted results. These risks and uncertainties include, among other things, product demand and acceptance, market competition, and risks inherent in the Company's international operations. These and other risks are described elsewhere herein and in the Company's other filings with the Securities and Exchange Commission. 11 12 PART II - OTHER INFORMATION Bio-Medical Automation, Inc. (formerly OZO Diversified Automation, Inc.) Items 1-4 Not Applicable. Item 5. On March 9, 1999, the Company completed the sale of substantially all of its assets to JOT Automation, Inc., as more completely described in the Company's current report on Form 8-K reporting an event of March 9, 1999, which report is incorporated herein. Also occurring during the reporting period were two changes related to the executive management of the Company. Specifically, Mr. David J. Wolenski tendered his resignation as President and Chief Executive Officer effective at the close of business on November 1, 1999. Although Mr. Wolenski will no longer be an officer of Bio-Medical Automation, Inc., he will continue to serve on the Company's Board of Directors. As a result of this action, Mr. Alvin L. Katz has been named to the position of President and Chief Executive Officer, and will replace Mr. Wolenski as of the November 1st transition date. Mr. Katz will assume this new role in addition to his current responsibility as Chairman of the Board of Directors. Item 6 Exhibits and Reports on Form 8-K a) Exhibits - none b) Report on Form 8-K reporting events under Items 2 and 5 of March 9, 1999, as amended. Item 7 Not Applicable 12 13 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. BIO-MEDICAL AUTOMATION, INC. By: /s/ David J. Wolenski /s/ Brantley J. Halstead ----------------------------- ----------------------------- David J. Wolenski Brantley J. Halstead Principal Executive Officer Principal Accounting Officer Principal Financial Officer Chief Financial Officer Dated: November 12, 1999 14 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 27 Financial Data Schedule
EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-QSB FOR THE PERIOD ENDED SEPTEMBER, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 9-MOS DEC-31-1999 JAN-01-1999 SEP-30-1999 513,955 0 8,150 0 0 522,105 0 0 538,348 81,310 0 0 0 64,313 392,725 538,348 0 0 0 133,526 0 0 0 (133,526) 0 (133,526) 684,459 0 0 550,933 0.88 0.85
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