-----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, BI6cvsW1eEs2XxdKeK1NwSdBnzQ5B+azPr4hmEk5nZRCvxC3Q2lKHbgE1I/EyATK hgnAR7ojfYIljXFg10JXTA== 0001001277-98-000005.txt : 19980115 0001001277-98-000005.hdr.sgml : 19980115 ACCESSION NUMBER: 0001001277-98-000005 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19971130 FILED AS OF DATE: 19980114 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OPHTHALMIC IMAGING SYSTEMS INC CENTRAL INDEX KEY: 0000885317 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 943035367 STATE OF INCORPORATION: CA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 001-11140 FILM NUMBER: 98506928 BUSINESS ADDRESS: STREET 1: 221 LATHROP WAY STE 1 CITY: SACRAMENTO STATE: CA ZIP: 95815 BUSINESS PHONE: 9166462020 10QSB 1 FORM 10QSB FOR OPHTHALMIC IMAGING SYSTEMS FORM 10-QSB SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the quarterly period ended November 30, 1997 Commission File Number: 1-11140 OPHTHALMIC IMAGING SYSTEMS (Exact name of registrant as specified in its charter) CALIFORNIA 94-3035367 (State of Incorporation)(IRS Employer Identification No.) 221 LATHROP WAY, SUITE I, SACRAMENTO, CA 95815 (Address of principal executive offices) (916) 646-2020 (Issuer's telephone number) Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 XX No As of January 12, 1998, 3,905,428 shares of common stock, at no par value, were outstanding. 1 PART I FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS OPHTHALMIC IMAGING SYSTEMS CONDENSED BALANCE SHEET NOVEMBER 30, 1997 (UNAUDITED) ASSETS CURRENT ASSETS: CASH AND EQUIVALENTS $ 227,513 ACCOUNTS RECEIVABLE, NET 1,662,224 INVENTORIES, NET 936,309 PREPAID EXPENSES AND OTHER CURRENT ASSETS 60,073 ----------- TOTAL CURRENT ASSETS 2,886,119 FURNITURE AND EQUIPMENT, NET OF ACCUMULATED DEPRECIATION AND AMORTIZATION OF $804,290 369,849 OTHER ASSETS 9,216 ----------- $ 3,265,184 =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: BORROWINGS UNDER LINE OF CREDIT 397,932 ACCOUNTS PAYABLE 687,326 ACCRUED LIABILITIES 1,185,215 ACCRUED WARRANT APPRECIATION RIGHT 251,497 DEFERRED EXTENDED WARRANTY REVENUE 127,673 CUSTOMER DEPOSITS 315,743 CURRENT PORTION OF NOTES PAYABLE 700 ---------- TOTAL CURRENT LIABILITIES 2,966,086 NOTES PAYABLE, LESS CURRENT PORTION -- COMMITMENTS STOCKHOLDERS' EQUITY: PREFERRED STOCK, NO PAR VALUE, 20,000,000 SHARES AUTHORIZED; NONE ISSUED OR OUTSTANDING -- COMMON STOCK, NO PAR VALUE, 20,000,000 SHARES AUTHORIZED; 3,905,428 ISSUED AND OUTSTANDING 10,278,615 DEFERRED COMPENSATION (312,213) ACCUMULATED DEFICIT (9,667,304) ----------- TOTAL STOCKHOLDERS' EQUITY 299,098 ----------- 3,265,184 =========== SEE ACCOMPANYING NOTES. 2 OPHTHALMIC IMAGING SYSTEMS CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) THREE MONTHS ENDED NOVEMBER 30, 1997 1996 ------------------------------- NET REVENUES $1,901,877 $ 884,246 COST OF SALES 1,181,996 621,532 ------------------------------ GROSS PROFIT 719,881 262,714 OPERATING EXPENSES: SALES AND MARKETING 572,418 496,978 GENERAL AND ADMINISTRATIVE 323,418 282,768 RESEARCH AND DEVELOPMENT 212,268 264,781 ------------------------------ TOTAL OPERATING EXPENSES 1,108,104 1,044,527 ------------------------------ LOSS FROM OPERATIONS (388,223) (781,813) OTHER EXPENSE, NET (9,129) (13,722) ------------------------------ NET LOSS (397,352) (795,535) ============================== SHARES USED IN THE CALCULATION OF NET LOSS PER SHARE 3,905,428 3,320,969 ============================== NET LOSS PER SHARE (0.10) (0.24) ============================== SEE ACCOMPANYING NOTES. 3 OPHTHALMIC IMAGING SYSTEMS CONDENSED STATEMENTS OF CASH FLOWS INCREASE (DECREASE) IN CASH AND EQUIVALENTS (UNAUDITED) THREE MONTHS ENDED NOVEMBER 30, 1997 1996 ------------------------------- OPERATING ACTIVITIES: NET LOSS $ (397,352) $ (795,535) ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES: DEPRECIATION AND AMORTIZATION 29,459 31,622 STOCK OPTION COMPENSATION EXPENSE 28,681 -- NET (INCREASE) DECREASE IN CURRENT ASSETS OTHER THAN CASH AND EQUIVALENTS (126,605) 190,107 NET INCREASE IN CURRENT LIABILITIES OTHER THAN SHORT-TERM BORROWINGS 485,991 247,986 ------------------------------- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 20,174 (325,820) INVESTING ACTIVITIES: PURCHASES OF FURNITURE AND EQUIPMENT (18,526) (104,668) NET (INCREASE) DECREASE IN OTHER ASSETS (1,831) 23,462 ------------------------------- NET CASH USED IN INVESTING ACTIVITIES (20,357) (81,206) FINANCING ACTIVITIES: PRINCIPAL PAYMENTS ON NOTES PAYABLE (1,534) (1,386) NET PROCEEDS FROM (REPAYMENTS OF) LINE-OF-CREDIT BORROWINGS 86,930 (269,000) NET PROCEEDS FROM SALE OF COMMON STOCK -- 85,491 ------------------------------ NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 85,396 (184,895) ------------------------------ NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 85,213 (591,921) ------------------------------ CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 142,300 1,051,325 ------------------------------ CASH AND EQUIVALENTS AT END OF PERIOD $ 227,513 $ 459,404 ============================== SEE ACCOMPANYING NOTES. 4 Ophthalmic Imaging Systems Notes to Condensed Financial Statements Three Month Periods ended November 30, 1997 and 1996 (Unaudited) Note 1. BASIS OF PRESENTATION THE ACCOMPANYING UNAUDITED CONDENSED BALANCE SHEET AS OF NOVEMBER 30, 1997, CONDENSED STATEMENTS OF OPERATIONS FOR THE THREE MONTH PERIODS ENDED NOVEMBER 30, 1997 AND 1996 AND THE CONDENSED STATEMENTS OF CASH FLOWS FOR THE THREE MONTH PERIODS ENDED NOVEMBER 30, 1997 AND 1996 HAVE BEEN PREPARED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES FOR INTERIM FINANCIAL INFORMATION AND WITH THE INSTRUCTIONS TO FORM 10-QSB AND ITEM 310(B) OF REGULATION S-B. ACCORDINGLY, THEY DO NOT INCLUDE ALL OF THE INFORMATION AND FOOTNOTE DISCLOSURES REQUIRED BY GENERALLY ACCEPTED ACCOUNTING PRINCIPLES FOR COMPLETE FINANCIAL STATEMENTS. IT IS SUGGESTED THAT THESE CONDENSED FINANCIAL STATEMENTS BE READ IN CONJUNCTION WITH THE AUDITED FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED IN THE REGISTRANT'S (THE COMPANY'S) ANNUAL REPORT FOR THE FISCAL YEAR ENDED AUGUST 31, 1997 ON FORM 10-KSB. IN THE OPINION OF MANAGEMENT, THE ACCOMPANYING CONDENSED FINANCIAL STATEMENTS INCLUDE ALL ADJUSTMENTS, CONSISTING ONLY OF NORMAL RECURRING ADJUSTMENTS, NECESSARY FOR A FAIR PRESENTATION OF THE COMPANY'S FINANCIAL POSITION AND RESULTS OF OPERATIONS FOR THE PERIODS PRESENTED. THE RESULTS OF OPERATIONS FOR THE PERIOD ENDED NOVEMBER 30, 1997 ARE NOT NECESSARILY INDICATIVE OF THE OPERATING RESULTS FOR THE FULL YEAR. CERTAIN AMOUNTS IN THE FISCAL 1997 FINANCIAL STATEMENTS HAVE BEEN RECLASSIFIED TO CONFORM WITH THE PRESENTATION IN THE FISCAL 1998 FINANCIAL STATEMENTS. NOTE 2. NET LOSS PER SHARE NET LOSS PER SHARE IS COMPUTED USING THE WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING. COMMON EQUIVALENT SHARES FROM STOCK OPTIONS AND WARRANTS ARE EXCLUDED FROM THE COMPUTATION OF NET LOSS PER SHARE BECAUSE THEIR EFFECT IS ANTIDILUTIVE. 6 NOTE 3. LINE OF CREDIT IN APRIL 1995, THE COMPANY ENTERED INTO A REVOLVING LINE OF CREDIT AGREEMENT (THE "CREDIT AGREEMENT") WITH A BANK (THE "BANK") WHICH, AFTER SEVERAL AMENDMENTS, EXPIRED ON NOVEMBER 7, 1997. THE MAXIMUM AMOUNT AVAILABLE UNDER THE TERMS OF THE CREDIT AGREEMENT WAS $750,000 AND WAS BASED UPON ELIGIBLE OUTSTANDING ACCOUNTS RECEIVABLE BALANCES. BORROWINGS UNDER THE CREDIT AGREEMENT BORE INTEREST AT THE BANK'S PRIME LENDING RATE PLUS THREE PERCENT AND WERE SECURED BY VIRTUALLY ALL ASSETS OF THE COMPANY. THE CREDIT AGREEMENT ALSO CONTAINED CERTAIN RESTRICTIVE COVENANTS WHICH PROVIDED FOR, AMONG OTHER THINGS, CERTAIN WORKING CAPITAL AND NET WORTH BALANCE AND RATIOS. THE CREDIT AGREEMENT WAS SUBSEQUENTLY CONVERTED TO A FULL RECOURSE ACCOUNTS RECEIVABLE CREDIT AGREEMENT. ON NOVEMBER 18, 1997, THE COMPANY ENTERED INTO AN ACCOUNTS RECEIVABLE CREDIT AGREEMENT (THE "AGREEMENT") WITH THE BANK, AND ALL AMOUNTS OUTSTANDING UNDER THE CREDIT AGREEMENT WERE CONSIDERED TO BE THE INITIAL ADVANCE UNDER THE AGREEMENT. THE AGREEMENT ALLOWS FOR UP TO AN 80% ADVANCE RATE ON ELIGIBLE ACCOUNTS RECEIVABLE BALANCES, AND THE MAXIMUM BORROWING BASE UNDER THE AGREEMENT IS $1.2 MILLION. THE BANK HAS FULL RECOURSE AGAINST THE COMPANY AND THE AGREEMENT EXPIRES IN NOVEMBER 1998. BORROWINGS UNDER THE AGREEMENT BEAR INTEREST AT THE BANK'S PRIME LENDING RATE PLUS 4%. IN ADDITION, THE BANK WILL CHARGE MONTHLY AN ADMINISTRATIVE FEE EQUAL TO THE GREATER OF 1/2 % OF THE AVERAGE DAILY BALANCE FOR THE MONTH OR $1,200. UNDER THE TERMS OF THE AGREEMENT, BORROWINGS ARE SECURED BY SUBSTANTIALLY ALL OF THE COMPANY'S ASSETS. NOTE 4. PRIVATE PLACEMENT IN NOVEMBER 1995, THE COMPANY COMPLETED A PRIVATE PLACEMENT OF 1,368,421 SHARES OF ITS COMMON STOCK WITH DETACHABLE WARRANTS. THE NET PROCEEDS FROM THIS OFFERING WAS APPROXIMATELY $1,075,000. ALONG WITH EACH SHARE OF COMMON STOCK ISSUED, THE PURCHASERS WERE GIVEN AN "A WARRANT AND "B WARRANT" TO PURCHASE SHARES OF THE COMPANY'S COMMON STOCK. THE A AND B WARRANTS PER SHARE EXERCISE PRICES WERE $1.25 AND $1.75, RESPECTIVELY. THE A AND B WARRANTS EXPIRED ON FEBRUARY 19, 1997 AS AMENDED AND NOVEMBER 21, 1997, RESPECTIVELY. THE PRIVATE PLACEMENT UNDERWRITER WAS ISSUED A WARRANT TO PURCHASE 250,000 SHARES OF THE COMPANY'S COMMON STOCK AT $.95 PER SHARE. THE NUMBER OF SHARES EXERCISABLE AS WELL AS THE PER SHARE EXERCISE PRICE ARE SUBJECT TO ADJUSTMENT UPON THE OCCURRENCE OF CERTAIN EVENTS. THIS WARRANT EXPIRES ON NOVEMBER 21, 1999. IN ADDITION, THE UNDERWRITER WILL RECEIVE AS A COMMISSION, 10% OF THE PROCEEDS RECEIVED BY THE COMPANY UPON EXERCISE OF THE A AND B WARRANTS DESCRIBED ABOVE. 7 NOTE 5. NONSTATUTORY STOCK OPTION PLAN IN OCTOBER 1997, THE COMPANY'S BOARD OF DIRECTORS APPROVED THE 1997 NONSTATUTORY STOCK OPTION PLAN (THE "PLAN") UNDER WHICH ALL OFFICERS, EMPLOYEES DIRECTORS AND CONSULTANTS MAY PARTICIPATE. THE PLAN EXPIRES IN OCTOBER 2002. OPTIONS GRANTED UNDER THE PLAN ARE NON-QUALIFIED STOCK OPTIONS AND WILL HAVE A TERM OF NOT LONGER THAN TEN (10) YEARS FROM THE DATE OF GRANT, UNLESS OTHERWISE SPECIFIED IN THE OPTION AGREEMENT. THE EXERCISE PRICES UNDER THE PLAN WILL GENERALLY BE AT 100% OF THE FAIR MARKET VALUE OF THE COMPANY'S COMMON STOCK ON THE DATE OF GRANT. THE MAXIMUM NUMBER OF SHARES OF THE COMPANY'S COMMON STOCK WHICH MAY BE OPTIONED AND SOLD UNDER THE PLAN IS 1,000,000, OF WHICH 861,500 OPTIONS REMAINED AVAILABLE FOR GRANTING AS OF NOVEMBER 30, 1997. AS OF NOVEMBER 30, 1997, STOCK OPTIONS TO PURCHASE 138,500 SHARES AT EXERCISE PRICES OF $1.09 WERE GRANTED AND OUTSTANDING UNDER THE PLAN AND NONE OF THE GRANTED OPTIONS WERE EXERCISED. 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS THE STATEMENTS BELOW INCLUDE STATEMENTS THAT ARE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF SECTION 21A OF THE SECURITIES ACT OF 1933, AS AMENDED, IN SECTION 21E OF THE SECURITIES ACT OF 1934, AS AMENDED, AND IS SUBJECT TO THE SAFE HARBOR CREATED THEREBY. FUTURE OPERATING RESULTS MAY BE ADVERSELY EFFECTED AS A RESULT OF A NUMBER OF FACTORS ENUMERATED IN THE COMPANY'S PUBLIC REPORTS. OVERVIEW To date, the Company has designed, developed, manufactured and marketed ophthalmic digital imaging systems and has derived substantially all of its revenues from the sale of such products. The Company has a reputation within the ophthalmic community for producing high quality, reliable, easy to use equipment and believes itself to be an acknowledged industry leader in the technology and sales of digital ophthalmic imaging systems. The Company believes, however, that as the U.S. healthcare system moves toward managed care the needs of the managed care providers are changing the nature and demand for medical imaging equipment and services. New opportunities in telemedicine are emerging that may allow managed care organizations to reduce costs while maintaining their quality of patient care. OIS plans to leverage its digital imaging technology and established customer base to develop product features and services targeting telemedicine/managed care applications for the ocular health care industry. Since its inception, the Company's products have addressed primarily the needs of the ophthalmic fluorescein angiography market, and more recently the indocyanine green ("ICG") market. While the Company believes that the overall angiography market has modest growth potential, sustaining growth in its traditional angiography equipment business may become increasingly difficult due to increased competition. In recognition of this, the Company is expanding its product capabilities to address the emerging telemedicine market. The Company will continue to support and expand its entire line of digital angiography products, and will focus its future efforts on developing product enhancements and pursuing viable opportunities in this market, particularly as they relate to telemedicine applications. The Company's objective is to become a leading provider of ophthalmic diagnostic products and services in the ocular health care industry, while maintaining its position as a market leader in its existing digital imaging products and telemedicine. 9 In this regard, during fiscal 1996 and 1997, the Company expended significant resources in developing a Reading and Documentation Center through which it originally intended to provide documentation services of electronically transmitted digital images acquired at remote locations. The Company has recently redefined the scope of the Reading and Documentation Center, however, to support research and development efforts surrounding its existing products. The Reading and Documentation Center is presently being utilized in the validation of diabetic retinopathy screening through electronically transmitted digital images acquired at remote locations. The Company is currently conducting a pilot program with a major managed care provider to evaluate remote image interpretation for diabetic retinopathy screening and intends to utilize this validation study to help expand the use of the Company's digital imaging products for such screening. The Company also recently has refocused its resources on the marketing and sales of its WinStation digital imaging systems. The Company's products are currently being utilized in a variety of ophthalmic settings for the telemedicine application of remote consultation. The Company is currently focusing its product development efforts on features and enhancements to its existing products targeting various other telemedicine applications. Additionally, in the near-term, the Company intends to utilize its Reading and Documentation Center to develop and assess viable opportunities for the Company's digital imaging products in screening, remote consultation, distance learning and other telemedicine applications. During the recently completed fall meeting of the American Academy of Ophthalmology ("AAO"), the Company introduced new models of its digital angiography products incorporating enhanced telemedicine features, with the Company receiving significantly more purchase commitments for its products as compared to previous AAO meetings. The Company no longer actively markets for the sale of its Glaucoma-Scope but continues to assess market opportunities for this product. The Company's results of operations have historically fluctuated from quarter to quarter due to a number of factors and are not necessarily indicative of the results to be expected for any future period or expected for the fiscal year ending August 31, 1998. There can be no assurance that revenue growth or profitability can be achieved or sustained in the future. The following discussion should be read in conjunction with the unaudited interim financial statements and the notes thereto which are set forth elsewhere in this Report on Form 10-QSB. In the opinion of management, the unaudited interim period financial statements include all adjustments, all of which are of a normal recurring nature, that are necessary for a fair presentation of the results of the periods. 10 RESULTS OF OPERATIONS The Company incurred a net loss of $397,352, or $.10 per share, for the first quarter of fiscal 1998 as compared to a net loss of $795,535, or $.24 per share, for the first quarter of fiscal 1997. The Company's revenues for the first quarter of fiscal 1998 were $1,901,877 representing an increase of approximately 215% from revenues of $884,246 for the first quarter of fiscal 1997. The primary factor contributing to the increased 1998 revenue levels was the significantly increased unit sales of the Company's digital angiography products during the first quarter of 1998, including lower-priced digital imaging systems targeted to the general ophthalmology and retinal specialty practice markets introduced at the 1996 fall meeting of the American Academy of Ophthalmology ("AAO"), the initial deliveries of which were made during the latter half of 1997. The Company also made initial deliveries during the first quarter of 1998 of new models of its digital angiography products introduced at the recently completed 1997 fall meeting of the AAO, at which the Company received significantly more purchase commitments for its products as compared to previous AAO meetings. In addition, the reduced 1997 first quarter revenue level reflects the adverse impact of the reallocation of the Company's resources to pursue sales of its Reading and Documentation Center services, which selling activities have since ceased. During 1998, the Company intends to continue to direct the majority of its resources to both support the demand for its digital imaging products and, more recently, to pursue opportunities in the telemedicine/managed care market. Gross margins were approximately 38% during the first quarter ended November 30, 1997 versus approximately 30% for the comparable quarter of 1997. This increase in gross margin percentage was attributable primarily to the significantly increased revenue levels during 1998. The Company continues to evaluate its expenses in this area consistent with current and anticipated business conditions and management anticipates that near-term margin improvement, if any, would result principally from reduced material costs associated with current deliverable system configurations, outsourcing additional manufacturing and assembly operations and related fixed cost reduction measures implemented during the latter half of 1997, including personnel cutbacks, economies of scale from increased unit production and other manufacturing efficiencies. Sales and marketing and general and administrative expenses accounted for approximately 47% of total revenues during the first quarter of fiscal 1997 as compared with approximately 88% during the first quarter of fiscal 1996. Expense levels increased, however, to $895,836 during the first quarter of 1998 versus $779,747 during the first quarter of 1997. The primary factors contributing to the increase were increased commissions and other costs associated with increase revenue levels during the first quarter of 1998 versus the comparable period 1998, as well as the costs related to additional senior management level personnel hired during the fourth quarter of fiscal 1997. The Company anticipates expenses in this area will continue to run above historical levels. 11 Research and development expenses, as a percentage of revenues, was approximately 11% in the first quarter of 1998 versus approximately 30% during the same period of 1997. Expense levels also decreased in actual dollar terms to $212,268 during the first quarter of 1998 from $264,781 in 1997. The Company intends to focus its research and development efforts on current product enhancements and reducing cost configurations for its current products. The Company anticipates that research and development expense will be maintained at current levels in the near term. Other expense was $9,129 during the first quarter of fiscal 1998 versus $13,722 during the same period of 1997. The primary contributing factor to this change was a decrease in interest expense during 1998 versus 1997 associated with reduced average daily borrowings against existing credit lines during the first quarter of 1998 versus 1997. LIQUIDITY AND CAPITAL RESOURCES The Company's operating activities generated cash of $20,174 in the first quarter of fiscal 1998 and used cash of $325,820 in the first quarter of fiscal 1997. Cash generated from operating activities in the first quarter of 1998 resulted principally from the collection of accounts receivable, significantly increased revenue levels and increases in customer deposits from orders generated at the 1997 AAO fall meeting, the aggregate impact of which more than offset the net loss for the quarter. Cash used by operations in the 1997 first quarter resulted primarily from the net loss during the period and the decrease in accounts receivable associated with significantly reduced revenue levels during the period, which amount was partially offset by increases in customer deposits from orders generated at the 1996 AAO meeting and other current liabilities, excluding borrowings under the Credit Agreement. Cash used in investing activities was $20,357 during the first quarter of 1998 as compared to $81,206 during the same period for 1997. The Company's primary investing activities consist of equipment and other capital asset acquisitions. The Company does not currently have any pending material commitments regarding capital expenditures. The Company, however, will continue to upgrade its existing management information and corporate communications systems, which may result in increased near-term capital expenditures. In addition, the Company anticipates certain capital expenditures to support efforts to expand its technology to telemedicine/managed care applications. The Company anticipates that related expenditures, if any, will be financed from one or more of the following sources: (i) working capital; (ii) borrowings under an existing credit agreement, if available; or (iii) debt, equity or other financing arrangements, if any, available to the Company. 12 The Company generated cash of $85,396 from financing activities during the first quarter of fiscal 1998 as compared to using cash in the amount of $184,895 during the same period of fiscal 1997. The source of cash from financing activities in 1998 was proceeds from increased borrowings under the Credit Agreement. The use of cash in financing activities during the 1997 period was principally repayments of borrowings under the Credit Agreement, which amount was partially offset by net proceeds from the exercise of stock options issued to employees. Principal repayments on notes payable was negligible in both 1997 and 1996. As indicated in Note 3 of the Notes to Condensed Financial Statements, on November 18, 1997, the Company entered into an accounts receivable credit agreement (the "Agreement") with the Bank, and all amounts outstanding under the Credit Agreement were considered to be the initial advance under the Agreement. The Agreement allows for up to an 80% advance rate on eligible accounts receivable balances, and the maximum borrowing base under the Agreement is $1.2 million. The Bank has full recourse against the Company and the Agreement expires in November 1998. Borrowings under the Agreement bear interest at the Bank's prime lending rate plus 4%. In addition, the Bank will charge monthly an administrative fee equal to the greater of 1/2 % of the average daily balance for the month or $1,200. Under the terms of the Agreement, borrowings are secured by substantially all of the Company's assets. The Company believes that its existing cash balances together with ongoing collections of its accounts receivable and recently increased available borrowing capacity under the Agreement will be adequate to meet its liquidity and capital requirements in the near term. The Company does not expect to experience collection difficulties with respect to its accounts receivable that would have a material adverse effect on its liquidity. In addition, principal and interest amounts due under the alternative stock appreciation right with the Bank, which amounts were approximately $251,000 as of November 30, 1997, and were originally payable on November 30, 1997, have recently been extended to April 1, 1998. The Company will, however, continue to evaluate alternative sources of capital to meet its cash requirements, including other debt financing, issuing equity securities and entering into other financing arrangements and/or strategic alliances. There can be no assurance, however, that additional financing will be available and, if available, can be obtained on terms favorable to the Company. Additional capital could also be made available to the Company pursuant to the exercise of Series C Warrants issued to JB Oxford & Company ("JBO") in connection with a November 1995 private placement of the Company's common stock, as well as from other outstanding stock options; however, there can be no assurance any such warrants or options will be exercised in the near-term, if at all. In this regard, there can be no assurance that the SEC investigation of JBO discussed immediately below may not adversely affect JBO's ability to exercise the Series C Warrants. 13 On or about August 17, 1997, the Company was advised that JB Oxford & Company ("JBO"), one of several market makers in the Company's common shares which trade over the counter on the NASDAQ Small-Cap Market, was being investigated by the Securities and Exchange Commission ("SEC"). In connection with this investigation, the Company, and Mr. Verdooner, in his capacity as Chief Executive Officer of the Company, were served by the SEC with a subpoena on or about August 18, 1997. These subpoenas require the submission to the SEC of various documents, predominantly relating to JBO. The Company has cooperated with the SEC investigation and is making every effort to produce the documents requested. The Company does not believe, nor has it any reason to believe, it is a subject of the SEC inquiries. In addition, the Company faces the possibility of its common stock being delisted from NASDAQ unless it meets the Minimum Closing Price Requirement as stipulated by NASDAQ. Under the NASDAQ rules, one prerequisite to continued listing on NASDAQ, is maintenance by a company of a minimum closing bid price of $1.00 per share. If a company's closing bid price per share is below $1.00 per share for ten (10) consecutive trading days, the company may be subject to having its shares delisted from NASDAQ. In September 1997, the Company's closing bid price per share fell below $1.00 per share for ten (10) consecutive trading days. Accordingly, the Company received a letter from NASDAQ which indicated that although the Company's closing bid price per share did not meet the minimum $1.00 requirement, NASDAQ was not going to commence any delisting action at that time. Instead, NASDAQ stated that the Company would be in compliance with its minimum listing price rules, if at any time during the next 90 calendar days from September 23, 1997, the closing bid price per share of the Company's common stock is at least $1.00 for ten consecutive trading days ("Minimum Closing Price Requirement"). Although the bid price of the Company's shares has closed at or above $1.00 per share for well in excess of ten (10) consecutive trading days since September 23, 1997, the Company did not meet the Minimum Closing Price Requirement during the 90 calendar day period from September 23, 1997. While the Company remains listed and has not been notified that NASDAQ will commence delisting action, there can be no assurance that the Company may not become subject to delisting from the NASDAQ Small-Cap Market in the future. Another prerequisite to continued listing on NASDAQ is maintenance of capital and surplus of at least $1 million. At August 31, 1997, the Company's capital and surplus balance was below $1 million and, in December 1997, the Company received a letter from NASDAQ which indicated that, although the Company's capital and surplus balance did not meet the $1 million requirement, NASDAQ was not going to commence any delisting action at that time, pending receipt by NASDAQ from the Company of proposal(s) for achieving compliance. The Company is currently in discussion with NASDAQ regarding this issue. If the Company's common stock is delisted, it may be difficult for the Company to raise capital through the sale of its common stock. 14 PART II OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None. ITEM 2. CHANGES IN SECURITIES In October 1997, the Company's board of directors approved the 1997 Nonstatutory Stock Option Plan (the "Plan") under which all officers, employees directors and consultants may participate. The Plan expires in October 2002. Options granted under the Plan are non-qualified stock options and will generally have a term of ten (10) years from the date of grant, unless otherwise specified in the option agreement. The exercise prices under the Plan will generally be at 100% of the fair market value of the Company's common stock on the date of grant. The maximum number of shares of the Company's common stock which may be optioned and sold under the Plan is 1,000,000, of which 861,500 options remained available for granting as of November 30, 1997. As of November 30, 1997, stock options to purchase 138,500 shares at exercise prices of $1.09 were granted and outstanding under the Plan and none of the granted options were exercised. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES None. 15 ITEM 5. OTHER INFORMATION The Board of Directors currently is considering the long range strategic plan for the Company and intends to engage the services of an investment banker or other financial advisor to assist it in evaluating and analyzing the strategic alternatives and potential business prospects available to the Company, including possible joint venture arrangements, acquisitions, third party investments, or the sale of the Company. Although the Company from time to time has considered and evaluated, and has engaged in informal and formal discussions concerning, certain business combination transaction or other joint business arrangements with unaffiliated third parties, the Company has not entered into any such transactions. The Company, however, recently has received inquiries from third parties regarding possible investments in the Company or other business ventures and opportunities which could involve, among other things, the sale of the Company or other business combination transactions. The Company intends to evaluate these opportunities with its investment banker or financial advisor as part of its long range strategic planning. Presently, the Company does not have any current understandings, arrangements, or agreements, whether written or oral, with respect to any specific transaction and, to date, has had only preliminary discussions with third parties relating thereto. Upon completion of the Board of Directors' determination of the appropriate strategic plan for the Company and its shareholders, it will attempt to implement the plan. However, there can be no assurance that the Company will be able to successfully implement such plan, or if implemented, that such plan will be successful. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) The exhibits listed on the accompanying Index to Exhibits below are filed as a part hereof and are incorporated by reference as noted. (b) A Form 8-K was filed on January 2, 1998, to report under Item 5 thereof the Company's adoption of a Rights Agreement, dated as of December 31, 1997, between Ophthalmic Imaginng Systems and American Securities Transfer, Inc., a copy of which Form 8-K will be made available upon request to the Company at its principal offices. 16 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the undersigned has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OPHTHALMIC IMAGING SYSTEMS (Registrant) By: STEVEN R. VERDOONER Steven R. Verdooner, Chief Executive Officer and Chief Financial Officer (principal executive officer and principal financial and accounting officer) By: WILLIAM L. MINCE William L. Mince, President and Chief Operating Officer Dated: January 14, 1998 17 INDEX TO EXHIBITS
Exhibit NUMBER DESCRIPTION OF EXHIBIT Footnote REFERENCE 3.1 Articles of Incorporation of the Registrant, as * amended. 3.1(a) Amendment to Articles of Incorportation (11) (Certificate of Determination of Preferences of Series A Junior Participating Preferred Stock of Ophthalmic Imaging Systems). 3.2 Amended Bylaws of the Registrant. * 4.1 See Exhibits 3.1 and 3.2 for provisions of the * Articles of Incorporation, as amended, and the amended Bylaws of the Registrant defining the rights of holders of Common Stock of the Registrant. 4.2 Specimen of Stock Certificate. * 4.3 Rights Agreement, dated as of December 31, 1997, (10) between Registrant and American Securities Transfer, Inc., including form of Rights Certificate attached thereto. 10.1 Lease Agreement, dated as of July 10, 1987, * between the Registrant (as tenant) and Transamerica/Emkay Income Properties I, as amended on July 23, 1990 and June 11, 1991. 10.1(a) Seventh Amendment to lease effective as of (7) July_18, 1996. 10.2 Employment Agreement, dated March 27, 1992, * between the Registrant and Dennis J. Makes. 10.2(a) Amendment dated June 30, 1993 to the Employment (1) Agreement between the Registrant and Dennis J. Makes dated March 27, 1992. 10.3 Confidentiality Agreement, dated March 27, 1992 * between the Registrant and Dennis J. Makes. 10.4 Confidentiality Agreement, dated March 27, 1992 * between the Registrant and Steven R. Verdooner. 18 10.5 Confidentiality Agreement, dated March 27, 1992 * between the Registrant and Richard Wullaert. 10.6 Consulting Agreement, dated January 23, 1992, * between the Registrant and G. Peter Halberg, M.D. 10.7 Assignment dated October 23, 1990 of U.S. Patent * Application for Apparatus and Method for Topographical Analysis of the Retina to the Registrant by Steven R. Verdooner, Patricia C. Meade, and Dennis J. Makes (as recorded on Reel 5490, Frame 423 in the Assignment Branch of the U.S. Patent and Trademark Office). 10.8 Form of International Distribution Agreement * used by the Registrant and sample form of End User Software License Agreement. 10.9 Original Equipment Manufacturer Agreement, dated * April 1, 1991, between the Registrant and SONY Medical Electronics, a division of SONY Corporation of America. 10.10 Original Equipment Manufacturer/Value Added * Reseller Agreement, dated May 7, 1991, between the Registrant and Eastman Kodak Company. 10.11 The Registrant's 1992 Nonstatutory Stock Option * Plan and sample form of Nonstatutory Stock Option Agreement. 10.12 Common Stock and Warrant Purchase Agreement * ("Stock Purchase Agreement"), dated as of February 8, 1992, among the Registrant, Jonnie R. Williams, Kathleen M. O'Donnell, as Trustee of Irrevocable Trust No. 6, FBO F.E. O'Donnell, Jr., M.D., Steven R. Verdooner and Dennis J. Makes. 10.12(a) Amendment No. 1 to Stock Purchase Agreement, * dated March 25, 1992, among the Registrant, Jonnie R. Williams, individually, Jonnie R. Williams, as Trustee of Irrevocable Trust No. 1, Rambert Simmons, and Kathleen M. O'Donnell, as Trustee of Irrevocable Trust No. 6, FBO F.E. O'Donnell, Jr., M.D. 10.13 Cross-Indemnification Agreement, dated * February_14, 1991, among Dennis Makes, Steven Verdooner, and Richard Wullaert. 19 10.14 Key Man Life Insurance Policies in the amount of * $1,000,000 for each of Dennis_J. Makes and Steven R. Verdooner, with the Registrant as the named beneficiary. 10.15 Warrant dated February 12, 1993 issued by the (1) Registrant to Steven R. Verdooner to purchase 50,000 shares of Common Stock. 10.16 Stock Option Plan. (1) 10.17 Promissory Note dated January_4, 1993 from the (1) Registrant to Western Financial Savings Bank in the amount of $25,209.83 due in full by January_4, 1998. 10.18 Rental Agreement dated May 1, 1994 by and (2) between the Registrant and Robert J. Rossetti. 10.19 Security and Loan Agreement (with Credit Terms (3) and Conditions) dated April_12, 1995 by and between the Registrant and Imperial Bank. 10.19(a) General Security Agreement dated April_12, 1995 (3) by and between the Registrant and Imperial Bank. 10.19(b) Warrant dated November 1, 1995 issued by the (4) Registrant to Imperial Bank to purchase 67,500 shares of Common Stock. 10.19(c) Amended Loan and Security Agreement (with Credit (4) Terms and Conditions) dated November 1, 1995. 10.19(d) Registration Rights Agreement dated November 1, (4) 1995 between the Registrant and Imperial Bank. 10.19(e) Amended Loan and Security Agreement (with Credit (6) Terms and Conditions) dated April 4, 1996. 10.19(f) Amended Loan and Security Agreement (with Credit (7) Terms and Conditions) dated July 12, 1996. 10.19(g) Amended Loan and Security Agreement (with Credit (7) Terms and Conditions) dated November 21, 1996. 10.19(h) Amended Loan and Security Agreement (with Credit (8) Terms and Conditions) dated June 3, 1997. 20 10.19(i) Amended Loan and Security Agreement (with Credit (9) Terms and Conditions) dated August 28, 1997. 10.19(j) Amended Loan and Security Agreement (with Credit (9) Terms and Conditions) dated October 24, 1997. 10.19(k) Amended Loan and Security Agreement (with Credit (9) Terms and Conditions) dated November 3, 1997. 10.19(l) Amended Loan and Security Agreement (with Credit (9) Terms and Conditions) dated November 21, 1997. 10.19(m) Agreement of Purchase of Receivable (Full (9) Recourse) dated November 18, 1997 between Registrant and Imperial Bank. 10.20 Purchase Agreements dated November 21, 1995 (4) between the Registrant, JB Oxford & Company and certain Investors. 10.20(a) Warrant Agreement dated November 21, 1995 (4) between the Registrant, JB Oxford & Company and certain Investors. 10.20(b) First Amendment Warrant Agreement dated November (7) 21, 1996 between the Registrant, JB Oxford & Company and certain Holders. 10.20(c) Registration Rights Agreement dated November 21, (4) 1995 between the Registrant, JB Oxford & Company and certain Investors. 10.21 Employment Agreement dated November 20, 1995 (4) between the Registrant and Steven R. Verdooner. 10.22 Employment Agreement dated November 20, 1995 (4) between the Registrant and R. Michael Clark. 10.23 Employment Agreement dated July 14, 1997 between (9) the Registrant and William L. Mince. 10.25 The Registrant's 1995 Nonstatutory Stock Option (5) Plan and sample form of Nonstatutory Stock Option Agreement. 10.26 The Registrant's 1997 Nonstatutory Stock Option (12) Plan and sample form of Nonstatutory Stock Option Agreement. 21 * INCORPORATED BY REFERENCE TO THE LIKE-NUMBERED EXHIBITS PREVIOUSLY FILED WITH REGISTRANT'S REGISTRATION STATEMENT ON FORM S-18, NUMBER 33-46864-LA. (1) INCORPORATED BY REFERENCE TO THE REGISTRANT'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED AUGUST 31, 1993 FILED ON NOVEMBER 26, 1993. (2) INCORPORATED BY REFERENCE TO THE REGISTRANT'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED AUGUST 31, 1994 FILED ON NOVEMBER 29, 1994. (3) INCORPORATED BY REFERENCE TO THE REGISTRANT'S QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED MAY 31, 1995 FILED ON JULY 14, 1995. (4) INCORPORATED BY REFERENCE TO THE REGISTRANT'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED AUGUST 31, 1995 FILED ON NOVEMBER 29, 1995. (5) INCORPORATED BY REFERENCE TO THE REGISTRANT'S REGISTRATION STATEMENT ON FORM S-8 FILED ON MAY 28, 1996, NUMBER 333-0461. (6) INCORPORATED BY REFERENCE TO THE REGISTRANT'S QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED MAY 31, 1996 FILED ON JULY 15, 1996. (7) INCORPORATED BY REFERENCE TO THE REGISTRANT'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED AUGUST 31, 1996 FILED ON NOVEMBER 29, 1996. (8) INCORPORATED BY REFERENCE TO THE REGISTRANT'S QUARTERLY REPORT ON FORM 10-QSB FOR THE QUARTERLY PERIOD ENDED MAY 31, 1997 FILED ON JULY 15, 1997. (9) INCORPORATED BY REFERENCE TO THE REGISTRANT'S ANNUAL REPORT ON FORM 10-KSB FOR THE FISCAL YEAR ENDED AUGUST 31, 1997 FILED ON DECEMBER 1, 1997. (10) INCORPORATED BY REFERENCE TO EXHIBIT 1 OF THE REGISTRANT'S FORM 8-K FILED ON JANUARY 2, 1998. (11) INCORPORATED BY REFERENCE TO EXHIBIT A OF EXHIBIT 1 OF THE REGISTRANT'S FORM 8-K FILED ON JANUARY 2, 1998. (12) EXHIBIT FILED HEREWITH.
EX-10 2 OPHTHALMIC IMAGING SYSTEMS, INC. 1997 STOCK OPTION PLAN 1. PURPOSE; DEFINITIONS. 1.1 PURPOSE. The purpose of the Plan is to attract, retain, and motivate the officers and employees of the Company, as well as the consultants to and directors of the Company, by giving all of them the opportunity to acquire Stock ownership in the Company and thereby instilling in them the same goals as the Company's other equity owners. 1.2 DEFINITIONS. For purposes of the Plan, the following terms shall have the following meanings: 1.2.1 "ADMINISTRATOR" shall mean the Compensation Committee referred to in Section 4 in its capacity as administrator of the Plan in accordance with Section 4. 1.2.2 "BOARD" shall mean the Board of Directors of the Company. 1.2.3 "COMPANY" shall mean Ophthalmic Imaging Systems, Inc., a California corporation. 1.2.4 "DIRECTOR" shall mean a member of the Board. 1.2.5 "EFFECTIVE DATE" shall have the meaning set forth in Section 2. 1.2.6 "ELIGIBLE PERSON" shall mean any director (including a director who is also a member of the Compensation Committee), officer, consultant, or employee of the Company. 1.2.7 "FAIR MARKET VALUE" shall mean the value established by the Administrator for purposes of granting Options under the Plan. 1.2.8 "GRANT DATE" shall mean the date of grant of any Option. 1.2.9 "OPTION" shall mean an option to purchase common stock under this Plan. All Options under the Plan shall be non-qualified stock options. 1 1.2.10 "OPTION AGREEMENT" shall mean the written option agreement with respect to an Option. 1.2.11 "OPTIONEE" shall mean the holder of an Option. 1.2.12 "PLAN" shall mean this Ophthalmic Imaging Systems, Inc. 1997 Stock Option Plan, as amended from time to time. 1.2.13 "STOCK" shall mean the common stock of the Company, no par value, and any successor entity to the Company. 1.2.14 "VESTING DATE" shall mean the date on which an Option becomes wholly or partially exercisable, as determined by the Administrator in its sole discretion. 2. EFFECTIVE DATE; TERM OF PLAN. The Effective Date of this Plan shall be upon the date the Board of Directors approve this Plan. This Plan, but not Options already granted, shall terminate automatically five (5) years after its adoption by the Board, unless terminated earlier by the Board under Section 12. No Options shall be granted after termination of this Plan but all Options granted prior to termination shall remain in effect in accordance with their terms. 3. NUMBER AND SOURCE OF SHARES OF STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 7, the total number of shares of Stock with respect to which Options may be granted under this Plan is 1 million (1,000,000) shares of Stock. The shares of Stock covered by any canceled, expired, or terminated Option or the unexercised portion thereof shall become available again for grant under this Plan. The shares of Stock to be issued hereunder upon exercise of an Option may consist of authorized and unissued shares or treasury shares. 4. ADMINISTRATION OF THE PLAN. This Plan shall be administered by a committee of at least two (2) non-employee members of the Board to which administration of this Plan is delegated by the Board (the "Compensation Committee"). The "Administrator" shall mean the "Compensation Committee" referred to in this Section 4 in its capacity as administrator of the Plan in accordance with this Section 4. The Administrator may delegate nondiscretionary administrative duties to such employees of the Company as it deems proper. Subject to the express provisions of this Plan, the Administrator shall have the authority to construe and interpret this Plan and any 3 agreements defining the rights and obligations of the Company and Optionees under this Plan; to further define the terms used in this Plan; to prescribe, amend, and rescind rules and regulations relating to the administration of this Plan; to determine the duration and purposes of leaves of absence which may be granted to Optionees without constituting a termination of their employment for purposes of this Plan; and to make all other determinations necessary or advisable for the administration of this Plan. Any decision or action of the Administrator in connection with this Plan or Options granted or shares of Stock purchased under this Plan shall be final and binding. The Administrator shall not be liable for any decision, action, or omission respecting this Plan, or any Options granted or shares of Stock sold under this Plan. The Board at any time may abolish the Compensation Committee and revest in the Board the administration of the Plan. To the extent permitted by applicable law in effect from time to time, no member of the Compensation Committee or the Board of Directors shall be liable for any action or omission of any other member of the Compensation Committee or the Board of Directors, nor for any act or omission on the member's own part, excepting only the member's own willful misconduct or gross negligence, arising out of or related to the Plan. The Company shall pay expenses incurred by, and satisfy a judgment or fine rendered or levied against, a present or former director or member of the Compensation Committee or Board in any action against such person (whether or not the Company is joined as a party defendant) to impose liability or a penalty on such person for an act alleged to have been committed by such person while a director or member of the Compensation Committee or Board arising with respect to the Plan or administration thereof, or out of membership on the Compensation Committee or Board, or by the Company, or all or any combination of the preceding; provided, the director or Compensation Committee member was acting in good faith, within what such director or Compensation Committee member reasonably believed to have been within the scope of his or her employment or authority, and for a purpose which he or she reasonably believed to be in the best interests of the Company or its shareholders. Payments authorized hereunder include amounts paid and expenses incurred in settling any such action or threatened action. The provisions of this section shall apply to the estate, executor, administrator, heirs, legatees, or devisees of a director or Compensation Committee member, and the term "person" as used in this section shall include the estate, executor, administrator, heirs, legatees, or devisees of such person. 5. GRANT OF OPTIONS; TERMS AND CONDITIONS OF GRANT. 5.1 GRANT OF OPTIONS. One or more Options may be granted to any Eligible Person. Subject to the express provisions of the Plan, the Administrator shall determine from the Eligible Persons those individuals to whom Options under the Plan may be granted. Each Option so granted shall be a non-qualified stock option. 4 Subject to the express provisions of this Plan, the Administrator shall specify the Grant Date, the number of shares of Stock covered by the Option, the exercise price, and the terms and conditions for exercise of the Option. If the Administrator fails to specify the Grant Date, the Grant Date shall be the date of the action taken by the Administrator to grant the Option. As soon as practicable after the Grant Date, the Company shall provide the Optionee with a written Option Agreement in the form approved by the Administrator, which sets out the Grant Date, the number of shares of Stock covered by the Option, the exercise price, and the terms and conditions for exercise of the Option. The Administrator may, in its absolute discretion, grant Options under this Plan to an Eligible Person at any time and from time to time before the expiration of five (5) years from the Effective Date. 5.2 GENERAL TERMS AND CONDITIONS. Except as otherwise provided herein, the Options shall be subject to the following terms and conditions and such other terms and conditions not inconsistent with this Plan as the Administrator may impose. 5.3 EXERCISE OF OPTION. In order to exercise all or any portion of any Option granted under this Plan, an Optionee must remain as an officer or employee, or as a consultant to or director of the Company, until the Vesting Date. The Vesting period shall not be less than one year from the Grant Date. The Option shall be exercisable on or after each Vesting Date in accordance with the terms set forth in the Option Agreement. 5.4 OPTION TERM. Each Option and all rights or obligations thereunder shall expire on such date as shall be determined by the Administrator, but not later than ten (10) years after the grant of the Option, and shall be subject to earlier termination as hereinafter provided. 5.5 EXERCISE PRICE. Unless otherwise specified by the Administrator, the exercise price of any option shall be one hundred percent (100%) of the fair market value of the Company's common stock on the date of option grant. 5.6 METHOD OF EXERCISE. To the extent the right to purchase shares of Stock has accrued, Options may be exercised, in whole or in part, from time to time in accordance with their terms by written notice from the Optionee to the Company stating the number of shares of Stock with respect to which the Option is being exercised and accompanied by payment in full of the exercise price. 5.7 PAYMENT FOR OPTION SHARES. 5.7.1 GENERAL RULE. The entire Exercise Price of Stock issued upon exercise of Options shall be payable in cash, wire transfer, certified check, or, at the absolute discretion of the Administrator, by non-certified check, at the time when such Stock is purchased. 5.7.2 SURRENDER OF STOCK. To the extent that this Section 5.7.2 is applicable, payment for all or any part of the exercise price, but not the payment of withholding taxes, may be made with Stock which has already been owned by the Optionee for more than 5 six (6) months. Such Stock shall be valued at its fair market value on the date of exercise of the new Stock being purchased under the Plan. 5.7.3 EXERCISE/SALE. To the extent that this Section 5.7.3 is applicable, payment may be made by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Stock and to deliver all or part of the sales proceeds to the Company in payment of all or part of the exercise price and/or any withholding taxes. 5.7.4 EXERCISE/PLEDGE. To the extent that this Section 5.7.4 is applicable, payment may be made by the delivery (on a form prescribed by the Company) of an irrevocable direction to pledge Stock to a securities broker or lender approved by the Company, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of all or part of the exercise price and/or any withholding taxes. 5.8 RESTRICTIONS ON STOCK; OPTION AGREEMENT. At the time it grants Options under this Plan, the Company may retain, for itself or others, rights to repurchase the shares of Stock acquired under the Option or impose other restrictions on such shares. The terms and conditions of any such rights or other restrictions shall be set forth in the Option Agreement evidencing the Option. No Option shall be exercisable until after execution of the Option Agreement by the Company and the Optionee. 5.9 NON-ASSIGNABILITY OF OPTION RIGHTS. No Option shall be transferable other than by will or by the laws of descent and distribution. During the lifetime of an Optionee, only the Optionee may exercise an Option. 5.10 EXERCISE AFTER CERTAIN EVENTS. 5.10.1 TERMINATION AS AN EMPLOYEE, DIRECTOR, OR CONSULTANT. If for any reason other than permanent and total disability or death (as defined below) an Optionee ceases to be employed by or to be a consultant to or director of the Company, Options held on the date of such termination (to the extent then exercisable) may be exercised, in whole or in part, at any time within three (3) months after such date, or such lesser period specified in the Option Agreement (but in no event after the earlier of (i) the expiration date of the Option as set forth in the Option Agreement, and (ii) ten (10) years from the Grant Date). 5.10.2 PERMANENT DISABILITY AND DEATH. If an Optionee becomes permanently and totally disabled (within the meaning of Section 22(e)(3) of the Internal Revenue Code), or dies while employed by the Company, or while acting as an officer, consultant, or director of the Company (or if the Optionee dies within the period that the Option remains exercisable after termination of employment or affiliation), Options then held (to the extent then exercisable) may be exercised by the Optionee, by the Optionee's personal representative, or by the person to whom the Option is transferred by will or the laws of descent and distribution, in whole or in part, at any time within one (1) year after the disability or death or any lesser period specified in the Option Agreement (but in no event after the earlier of (i) the expiration date of the Option as set forth in the Option Agreement, and (ii) ten (10) years from the Grant Date). 6 5.11 COMPLIANCE WITH SECURITIES LAWS. The Company shall not be obligated to issue any shares of Stock upon exercise of an Option unless such shares are at that time effectively registered or exempt from registration under the federal securities laws and the offer and sale of the shares of Stock are otherwise in compliance with all applicable securities laws. Upon exercising all or any portion of an Option, an Optionee may be required to furnish representations or undertakings deemed appropriate by the Company to enable the offer and sale of the shares of Stock or subsequent transfers of any interest in such shares to comply with applicable securities laws. Evidences of ownership of shares of Stock acquired upon exercise of Options shall bear any legend required by, or useful for purposes of compliance with, applicable securities laws, this Plan, or the Option Agreement evidencing the Option. 6. PAYMENT OF TAXES. Upon the exercise of an Option, the Company shall have the right to require such Optionee or such other person to pay by cash, or by check payable to the Company, the amount of any taxes which the Company may be required to withhold with respect to such transactions. Any such payment must be made promptly when the amount of such obligation becomes determinable and may be a condition prior to the delivery of any certificate for shares or registration of the transfer of such shares. 7. ADJUSTMENT FOR CHANGES IN CAPITALIZATION. The existence of outstanding Options shall not affect the Company's right to effect adjustments, recapitalizations, reorganizations, or other changes in its or any other corporation's capital structure or business, any merger or consolidation, any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Stock, the dissolution or liquidation of the Company's or any other corporation's assets or business, or any other corporate act, whether similar to the events described above or otherwise. Subject to Section 8, if the outstanding shares of the Stock are increased or decreased in number or changed into or exchanged for a different number or kind of securities of the Company or any other corporation by reason of a recapitalization, reclassification, stock split, combination of shares, stock dividend, or other event, an appropriate adjustment of the number and kind of securities with respect to which Options may be granted under this Plan, the number and kind of securities as to which outstanding Options may be exercised, and the exercise price at which outstanding Options may be exercised, will be made. 7 8. DISSOLUTION, LIQUIDATION, OR MERGER. 8.1 COMPANY NOT THE SURVIVOR. In the event of a dissolution or liquidation of the Company, a merger, consolidation, combination, or reorganization in which the Company is not the surviving corporation, or a sale of substantially all of the assets of the Company, any outstanding Options shall become fully vested immediately upon the Company's public announcement of any one of the foregoing. The Board of Directors shall determine, in its sole and absolute discretion, when the Company shall be deemed to survive for purposes of this paragraph. If the Optionee does not exercise the entire Option within ninety (90) days, the Administrator, in its sole and absolute discretion, may, with respect to the unexercised portion of the Option: 8.1.1 cancel the Option upon payment to the Optionee of an amount equal to the difference between the closing price of the stock underlying the Option quoted the date before such liquidation, dissolution, merger, consolidation, combination, or reorganization, and the exercise price of the Option; or 8.2.1 assign the Option and all rights and obligations under it to the successor entity, with all such rights and obligations being assumed by the successor entity. 8.2 COMPANY IS THE SURVIVOR. In the event of a merger, consolidation, combination, or reorganization in which the Company is the surviving corporation, the Board of Directors shall determine the appropriate adjustment of the number and kind of securities with respect to which outstanding Options may be exercised, and the exercise price at which outstanding Options may be exercised. The Board of Directors shall determine, in its sole and absolute discretion, when the Company shall be deemed to survive for purposes of this Plan. 9. CHANGE OF CONTROL. If there is a "change of control" in the Company, all outstanding Options shall fully vest immediately upon the Company's public announcement of such a change. A "change of control" shall mean an event involving one transaction or a related series of transactions in which any one of the following occurs: (i) the Company issues securities equal to twenty-five percent (25%) or more of the Company's issued and outstanding voting securities, determined as a single class, to any individual, firm, partnership, limited liability company, or other entity, including a "group" within the meaning of SEC Exchange Act Rule 13d-3, (ii) the Company issues voting securities equal to twenty-five percent (25%) or more of the issued and outstanding voting stock of the Company in connection with a merger, consolidation, or other business combination, (iii) the Company is acquired in a merger or other business combination transaction in which the Company is not the surviving company, or (iv) all or substantially all of the Company's assets are sold or transferred. SEE Section 8 with respect to Options vesting upon the occurrence of either of the events described in (iii) or (iv) of this Section 9 and the result upon the non-exercise of the Options. 8 10. SUSPENSION AND TERMINATION. In the event the Board or the Administrator reasonably believes an Optionee has committed an act of misconduct specified below, the Administrator may suspend the Optionee's right to exercise any Option granted hereunder pending final determination by the Board or the Administrator. If the Administrator determines that an Optionee has committed an act of embezzlement, fraud, breach of fiduciary duty, or deliberate disregard of the Company rules resulting in loss, damage or injury to the Company, or if an Optionee makes an unauthorized disclosure of any Company trade secret or confidential information, engages in any conduct constituting unfair competition, is involved in the spreading of rumors or misinformation about the Company, induces or attempts to induce an employee to leave the employment of the Company, induces any Company customer to breach a contract with the Company or induces any principal for whom the Company acts as agent to terminate such agency relationship, neither the Optionee nor his estate shall be entitled to exercise any Option hereunder. In making such determination, the Board or the Administrator shall act fairly and in good faith and shall give the Optionee an opportunity to appear and present evidence on the Optionee's behalf. The determination of the Board or the Administrator shall be final and conclusive. 11. NO RIGHTS AS SHAREHOLDER OR TO CONTINUED EMPLOYMENT. An Optionee shall have no rights as a shareholder with respect to any shares of Stock covered by an Option. An Optionee shall have no right to vote any shares of Stock, or to receive distributions of dividends or any assets or proceeds from the sale of Company assets upon liquidation until such Optionee has effectively exercised the Option and fully paid for such shares of Stock. Subject to Sections 7 and 8, no adjustment shall be made for dividends or other rights for which the record date is prior to the date title to the shares of Stock has been acquired by the Optionee. The grant of an Option shall in no way be construed so as to confer on any Optionee the rights to continued employment by the Company. 12. TERMINATION; AMENDMENT. The Board may amend, suspend, or terminate this Plan at any time and for any reason, but no amendment, suspension, or termination shall be made which would impair the right of any person under any outstanding Options without such person's consent not unreasonably withheld. Further, the Board may amend this Plan to comply with Federal and State securities laws. 9 13. GOVERNING LAW. This Plan and the rights of all persons under this Plan shall be construed in accordance with and under applicable provisions of the laws of the State of California. Dated: OCTOBER 23, 1997 OPHTHALMIC IMAGING SYSTEMS, INC. By the Board of Directors STEVEN R. VERDOONER By Steven R. Verdooner, Secretary DATE OF GRANT: ___________ OPHTHALMIC IMAGING SYSTEMS, INC. NONQUALIFIED STOCK OPTION AGREEMENT THE GRANT OF THIS OPTION SHALL NOT IMPOSE AN OBLIGATION UPON THE OPTIONEE TO EXERCISE THIS OPTION. THIS OPTION AGREEMENT (the "Agreement") is made by and between Ophthalmic Imaging Systems, Inc., a California corporation (the "Corporation") and _____________________________ ("Optionee"), as of ____________, _____. In consideration of the mutual covenants contained herein and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows: 1.. GRANT OF OPTION. The Company hereby grants to Optionee, in the manner and subject to the conditions hereinafter provided, the right, privilege, and option to purchase (the "Option") an aggregate of __________________________ ( ) shares of the Company's Common Stock, no par value, (the "Shares"). This Option is specifically conditioned on compliance with the terms and conditions set forth herein. 2.. Term of Option. Subject to the terms, conditions, and restrictions set forth herein, the term of this Option shall be ten (10) years from the date of grant (the "Expiration Date"). Any portion of this Option not exercised prior to the Expiration Date shall thereupon become null and void. 3.. Exercise of Option. 4.. Vesting of Option. This Option shall become exercisable as follows: NUMBER OF SHARES VESTING DATE __________________ __/__/__ __________________ __/__/__ __________________ __/__/__ __________________ __/__/__ Each of the foregoing dates shall be referred to as a "Vesting Date" for that portion of this Option vested on such date ("Vested Portion"). All or any portion of the shares underlying a Vested Portion of this Option may be purchased during the term of this Option, but not as to less than 100 shares (unless the remaining shares then constituting the Vested Portion of this Option is less than 100 shares) at any time. 5.. MANNER OF EXERCISE. The Vested Portion of this Option may be exercised from time to time, in whole or in part, by presentation of a "Request To Exercise Form", substantially in the form attached hereto, to the Company at its principal office, which Form must be duly executed by Optionee and accompanied by payment, in cash, to the Company, in the aggregate amount of the Exercise Price (as defined below), multiplied by the number of Shares the Optionee is purchasing at such time, subject to reduction for withholding for tax obligations as provided in Section 13. Upon receipt and acceptance by the Company of such Form accompanied by the payment specified, the Optionee shall be deemed to be the record owner of the Shares purchased, notwithstanding that the stock transfer books of the Company may then be closed or that certificates representing the Shares purchased under this Option may not then be actually delivered to the Optionee. 6.. EXERCISE PRICE. The exercise price (the "Exercise Price") payable upon exercise of this Option shall be $__.__ per share. 7.. Exercise After Certain Events. 8.. Termination of Relationship. If for any reason other than permanent and total disability (as defined below) or death an Optionee ceases to be employed by, a director of, or provide consulting services to, the Company, Options held at the date of such termination (to the extent then exercisable) may be exercised, in whole or in part, at any time within three months after the date of such termination (but in no event after the expiration date of the Option). 9.. Permanent Disability and Death. If an Optionee becomes permanently and totally disabled (within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended), or dies while employed by the Company, or while acting as an officer, director, or consultant of the Company (or, if the Optionee dies within the period that the Option remains exercisable after termination of employment or affiliation), Options then held (to the extent then exercisable) may be exercised by the Optionee, the Optionee's personal representative, or by the person to whom the Option is transferred by will or the laws of descent and distribution, in whole or in part, at any time within one year after the disability or death (but in no event after the expiration date of the Option). 10.. Restrictions on Transfer of Option. This Option is not transferable by Optionee other than by will or the laws of descent and distribution and is exercisable only by the Optionee during his lifetime except as provided in Section 4.2. above. The Option and the Shares underlying the Option shall not be available for the debts or obligations of the Optionee, nor shall it be subject to disposition by transfer, alienation, pledge, or other means of disposition, whether voluntary or involuntary or by operation of law through judgment, levy, attachment, garnishment, or other legal proceeding (including bankruptcy). 11.. Adjustment for Changes in Capitalization. The existence of this Option shall not affect the Company's right to effect adjustments, recapitalizations, reorganizations, or other changes in its or any other corporation's capital structure or business, any merger or consolidation, any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Shares, the dissolution or liquidation of the Company's or any other corporation's assets or business or any other corporate act, whether similar to the events described above or otherwise. If the outstanding shares of the Company's Common Stock are increased or decreased in number or changed into or exchanged for a different number or kind of securities of the Company or any other corporation by reason of a recapitalization, reclassification, stock split, reverse stock split, combination of shares, stock dividend, or other similar event, an appropriate adjustment of the number and kind of securities with respect to which this Option may be exercised and the exercise price at which this Option may be exercised will be made. 12.. Dissolution, Liquidation, Merger. 13.. Company Not The Survivor. In the event of a dissolution or liquidation of the Company, a merger, consolidation, combination, or reorganization in which the Company is not the surviving corporation, or a sale of substantially all of the assets of the Company (as determined in the sole discretion of the Board of Directors), and the Optionee does not exercise the entire option within ninety days, the Administrator, in its absolute discretion, may (i) cancel each outstanding Option upon payment in cash to the Optionee of the amount by which any cash and the fair market value of any other property which the Optionee would have received as consideration for the shares of Stock covered by the Option if the Option had been exercised before such liquidation, dissolution, merger, consolidation, or sale, exceeds the exercise price of the Option or (ii) assign the Option and all rights and obligations under it to the succession entity. In addition to the foregoing, in the event of a dissolution or liquidation of the Company, or a merger, consolidation, combination, or reorganization in which the Company is not the surviving corporation, any outstanding Option pursuant to this Agreement shall vest. 14.. Company is the Survivor. In the event of a merger, consolidation, combination, or reorganization in which the Company is the surviving corporation, the Board of Directors shall determine the appropriate adjustment of the number and kind of securities with respect to which outstanding Options may be exercised, and the exercise price at which outstanding Options may be exercised. The Board of Directors shall determine, in its sole and absolute discretion, when the Company shall be deemed to survive for purposes of this Agreement. 15.. Reservation of Shares. The Company agrees that prior to the earlier of the expiration of this Option or the exercise and purchase of the total number of Shares represented by this Option, there shall be reserved for issuance and delivery upon exercise of this Option such number of the Company's authorized and unissued Shares as shall be necessary to satisfy the terms and conditions of this Agreement. 16.. No Rights as Shareholder. The Optionee shall have no rights as a shareholder with respect to any Shares covered by this Option unless the Optionee shall have exercised this Option, and then only with respect to the shares underlying the portion of the Option exercised. The Optionee shall have no right to vote any Shares, or to receive distributions of dividends or any assets or proceeds from the sale of Company assets upon liquidation, until the Optionee has effectively exercised this Option and fully paid for such Shares. Subject to Section 6, no adjustment shall be made for dividends or other rights for which the record date is prior to the date title to the Shares has been acquired by the Optionee. 17.. No Rights to Employment or Continued Employment. The grant of this Option shall in no way be construed so as to confer on Optionee the rights to employment or continued employment by the Company. Nothing hereunder shall confer upon any Optionee any right to employment or to continue in the employ of the Company, or to interfere with or restrict in any way the rights of the Company, which are hereby expressly reserved, to terminate or discharge any Optionee at any time for any reason whatsoever, with or without cause. 18.. Suspension and Termination. In the event the Board reasonably believes that the Optionee has committed an act of misconduct specified below, the Board may suspend the Optionee's right to exercise any Option pending final determination by the Board, which final determination shall be made within five (5) business days of such suspension. If the Board determines that an Optionee has committed an act of embezzlement, fraud, breach of_fiduciary duty, or deliberate disregard of the Company rules resulting in loss, damage, or injury to the Company, or if an Optionee makes an unauthorized disclosure of any Company trade secret or confidential information, engages in any conduct constituting unfair competition, induces any Company customer to breach a contract with the Company, or induces any principal for whom the Company acts as agent to terminate such agency relationship, neither the Optionee nor his estate shall be entitled to exercise any Option hereunder. In making such determination, the Board shall act fairly and in good faith and shall give the Optionee an opportunity to appear and present evidence on the Optionee's behalf. 19.. Participation in Option Plans. The grant of this Option shall not prevent Optionee from participating or being granted other options under any option plans. 20.. Payment of Taxes. Unless the Board permits otherwise, the Optionee shall pay the Company in cash all local, state, and federal withholding taxes applicable, in the Board's absolute discretion, to the grant or exercise of this Option, or the transfer or other disposition of Shares acquired upon exercise of this Option. Any such payment must be made promptly when the amount of such obligation becomes determinable. The Board may, in lieu of such cash payment, withhold that number of Shares sufficient to satisfy such withholding. 21. 21. ISSUE AND TRANSFER TAX. The Company will pay all issuance taxes, if any, attributable to the initial issuance of Shares upon the exercise of the Option; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issue or delivery of any certificates for Shares in a name other than that of the Optionee. 22.. Representatives; Restricted Securities. The Optionee represents that he or she is purchasing the options for his or her own account and not with a view to or for sale in connection with any distribution of the Option. Further, the Optionee understands that this Option may not be transferred except in compliance with Section 5, and that upon the exercise of the Option the Optionee will receive "restricted securities" subject to a certain holding period unless such Common Stock is purchased pursuant to a Registration Statement filed with the Securities and Exchange Commission and registered or exempt under state law. 23.. Arbitration. Any controversy, dispute, or claim arising out of or relating to this Option which cannot be amicably settled including, but not limited to, the suspension or termination of Optionee's right in accordance with Section 11 above, shall be settled by arbitration. Said arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association at a time and place as selected by the arbitrator(s). 24.. Initiation of Arbitration. After seven (7) days prior written notice to the other, either party hereto may formally initiate arbitration under this Agreement by filing a written request therefor, and paying the appropriate filing fees, if any. 25.. Hearing and Determination Dates. The hearing before the arbitrator shall occur within thirty (30) days from the date the matter is submitted to arbitration. Further, a determination by the arbitrator shall be made within forty-five (45) days from the date the matter is submitted to arbitration. Thereafter, the arbitrator shall have fifteen (15) days to provide the parties with his or her decision in writing. However, any failure to meet the deadlines in this section will not affect the validity of any decision or award. 26.. Binding Nature of Decision. The decision of the arbitrator shall be binding on the parties. Judgment thereon shall be entered in a court of competent jurisdiction. 27.. Injunctive Actions. Nothing herein contained shall bar the right of either party to seek to obtain injunctive relief or other provisional remedies against threatened or actual conduct that will cause loss or damages under the usual equity rules including the applicable rules for obtaining preliminary injunctions and other provisional remedies. 28.. Costs. The cost of arbitration, including the fees of the arbitrator, shall be borne equally by the parties. 29.. Notices. All notices to be given by either party to the other shall be in writing and may be transmitted by personal delivery, facsimile transmission, overnight courier or mail, registered or certified, postage prepaid with return receipt requested; PROVIDED, HOWEVER, that notices of change of address or telex or facsimile number shall be effective only upon actual receipt by the other party. Notices shall be delivered at the following addresses, unless changed as provided for herein. To the Optionee: _____________________________ _____________________________ _____________________________ To the Company: Steven R. Verdooner Secretary Ophthalmic Imaging Systems, Inc. 221 Lathrop Way, Suite I Sacramento, California 95815 Telephone: 916-646-2020 Facsimile: 916-___-____ 30.. APPLICABLE LAW. This Agreement and the relationship of the parties in connection with its subject matter shall be governed by, and construed under, the laws of the state of California. 31.. Binding Effect. This Agreement shall inure to the benefit of, and be binding upon, the parties hereto and their respective heirs, executors, and successors. 32.. Tax Effect. The federal tax consequences of stock options are complex and subject to change. Each person should consult with his or her tax advisor before exercising any option or disposing of any shares acquired upon the exercise of an option. IN WITNESS WHEREOF, this Agreement has been executed as of the ____ day of ____________, _____, at Sacramento, California. OPHTHALMIC IMAGING SYSTEMS, INC. Steven R. Verdooner, Chief Executive Officer REQUEST TO EXERCISE FORM Dated:________________ The undersigned hereby irrevocably elects to exercise all or part, as specified below, of the Vested Portion of the option ("Option") granted to him pursuant to a certain stock option agreement ("Agreement") effective _____________________, between the undersigned and Ophthalmic Imaging Systems, Inc. (the "Company") to purchase an aggregate of _____________________ (__________) shares of the Company's Common Stock, no par value (the "Shares"). The undersigned hereby tenders cash in the amount of $__________ per share multiplied by _____________________ (_________), the number of Shares he is purchasing at this time, for a total of $_______________, which constitutes full payment of the total Exercise Price thereof. INSTRUCTIONS FOR REGISTRATION OF SHARES IN COMPANY'S TRANSFER BOOKS Name: ____________________________________ (Please typewrite or print in block letters) Address: ____________________________________ ____________________________________ Signature: ____________________________________ Accepted by Ophthalmic Imaging Systems, Inc.: By: ______________________________ ______________________________ Name ______________________________ Title EX-27 3
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 10-QSB FOR THE PERIOD ENDED NOVEMBER 30, 1997 FOR OPHTHALMIC IMAGING SYSTEMS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS AUG-31-1997 NOV-30-1997 227,513 0 1,662,224 0 936,309 2,886,119 1,174,139 (804,290) 3,265,184 2,966,086 0 0 0 10,278,615 (9,979,517) 3,265,184 1,901,877 1,901,877 1,181,996 1,181,996 1,108,104 (388,223) 9,129 (397,352) 0 (397,352) 0 0 0 (397,352) (.10) (.10)
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