-----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, Tzbsr3yv7V4iAoPAlzDQAwI7r32hMakm7nRHpfHu4/LW/cw3cthUINcExZavsHBl BgKst5bPLy6eUGV9rlUnqA== 0001005477-97-001904.txt : 19970725 0001005477-97-001904.hdr.sgml : 19970725 ACCESSION NUMBER: 0001005477-97-001904 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970724 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORLAND MEDICAL SYSTEMS INC CENTRAL INDEX KEY: 0000946428 STANDARD INDUSTRIAL CLASSIFICATION: LABORATORY ANALYTICAL INSTRUMENTS [3826] IRS NUMBER: 061387931 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-26206 FILM NUMBER: 97645027 BUSINESS ADDRESS: STREET 1: 106 CORPORATE PARK DRIVE STREET 2: SUITE 106 CITY: WHITE PLAINS STATE: NY ZIP: 10604 BUSINESS PHONE: 914-694-2285 MAIL ADDRESS: STREET 1: 106 CORPORATE PARK DRIVE STREET 2: SUITE 106 CITY: WHITE PLAINS STATE: NY ZIP: 10604 FORMER COMPANY: FORMER CONFORMED NAME: OSTECH INC DATE OF NAME CHANGE: 19950608 10-K/A 1 FORM 10-K/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K/A Annual Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 For the fiscal year ended December 31, 1996 Commission File No. 0-26206 NORLAND MEDICAL SYSTEMS, INC. (Exact name of registrant as specified in its charter) Delaware 06-1387931 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 106 Corporate Park Drive, Suite 106, White Plains, NY 10604 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (914) 694-2285 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.0005 per share Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No |_| Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K |_| The aggregate market value of the registrant's Common Stock, par value $0.0005 per share, held by non-affiliates of the registrant as of March 21, 1997 was $23,555,584 based on the price of the last reported sale on the NASDAQ National Market. As of March 21, 1997 there were 7,148,531 shares of the registrant's Common Stock, par value $0.0005 per share, outstanding. This Form 10-K/A Report amends the Form 10-K Report filed by the Registrant with the Securities and Exchange Commission on March 31, 1997, as amended by Forms 10-K/A filed on April 30, 1997, May 6, 1997, June 18, 1997 and July 10, 1997, respectively (as so amended, the "Original Report"). Items 6 and 8 of the Original Report are amended and restated in their entirety to read as set forth below. This amendment also amends Exhibit 27, the Financial Data Schedule, to conform the information contained therein to the other amendments made by this Form 10-K/A Report. 2 ITEM 6. SELECTED FINANCIAL DATA. The Company was formed in December 1993 to market, sell and service a range of diagnostic products that address selected needs in women's healthcare. It began operations in January 1994 as the exclusive distributor throughout much of the world for the bone densitometry products developed and manufactured by the Manufacturers. Both Manufacturers are subsidiaries of NMS BV. Certain of the Company's stockholders control NMS BV. The Company has no ownership interest in NMS BV. Under the Distribution Agreement with the Manufacturers, the Company (i) has rights to exclusive worldwide distribution of all medical diagnostic products manufactured or developed by Norland Corp. or Stratec (subject, at the present time, to Stratec's right to distribute its own products in Germany until the Company elects to take over such distribution) and (ii) with certain exceptions, may not distribute products manufactured by any non-affiliate of the Company that directly compete with their products. The Distribution Agreement has an initial term ending December 31, 2015, with rights to extend for successive five-year periods. During 1992 and 1993, Ostech B.V. ("OBV"), a subsidiary of NMS BV, served as exclusive distributor of Norland Corp.'s products for all locations outside the U.S., Canada and Switzerland and of Stratec's products for all locations outside Germany and Switzerland. Some of the former officers and employees of OBV are officers and employees of the Company. OBV's financial information for the periods ended December 31, 1992 and 1993 is presented for comparative purposes. OBV ceased all business activities at the end of 1993. The following financial data as of and for the periods ended December 31, 1992, 1993, 1994, 1995 and 1996 were derived from (i) the Company's financial statements for the years 1994, 1995 and 1996, which were audited by Coopers & Lybrand L.L.P., (ii) the financial statements of OBV for the year 1993, which were audited by Schweizerische Treuhandgesellschaft-Coopers & Lybrand AG, and (iii) the financial statements of OBV for the period from April 1, 1992 (date of commencement of operations) through December 31, 1992, which were audited by Deloitte & Touche Registeraccountants. The financial data should be read in conjunction with the audited financial statements of the Company and notes thereto, which are included at Item 8 of this Report, and with "Management's Discussion and Analysis of Financial Condition and Results of Operations" at Item 7 of this Report. 3
Ostech B.V. Norland Medical Systems, Inc. ---------------------------------------------------------------------------------- Period from Year Ended December 31, April 1, 1992 ----------------------------------------------------------------- to December 31, 1992 1993 1994 1995 1996 ------------ ------------ ------------ ------------- ------------ Statement of Income (Loss) Data: Revenue ..................................... $ 4,094,964 $ 5,488,095 $ 10,041,548 $ 18,243,808 $ 25,309,977 Cost of revenue ............................. 3,118,925 4,066,539 6,517,701 12,508,809 16,248,469 One-time distribution agreement costs ........................... 0 0 1,922,247 0 0 ------------ ------------ ------------ ------------ ------------ Gross profit .............................. 976,039 1,421,556 1,601,600 5,734,999 9,061,508 Sales and marketing expense ................. 747,292 1,068,197 973,208 1,651,125 3,605,666 General and administrative expense ................................... 183,219 399,449 526,364 960,368 2,570,212 ------------ ------------ ------------ ------------ ------------ Income (loss) from operations ............. 45,528 (46,090) 102,028 3,123,506 2,985,630 Liquidation loss - net ...................... 0 (326,007) 0 0 0 Other income (expense) ...................... 47,105 (13,760) (6,984) 412,983 703,744 ------------ ------------ ------------ ------------ ------------ Income (loss) before taxes ................ 92,633 (385,857) 95,044 3,536,489 3,689,374 Provision for taxes ......................... 9,629 60 27,000 1,436,000 1,498,000 ------------ ------------ ------------ ------------ ------------ Net income (loss) ......................... $ 83,004 $ (385,917) $ 68,044 $ 2,100,489 $ 2,191,374 ============ ============ ============ ============ ============ Earnings per share(1) ....................... -- -- $ 0.02 $ 0.40 $ 0.31 ============ ============ ============ Weighted average number of s common shares outstanding(1) .............. -- -- 4,002,000 5,248,184 7,168,871 As of December 31, ------------ ------------- ------------ 1994 1995 1996 ------------ ------------- ------------ Balance Sheet Data: Working capital.......................... $ 68,044 $ 20,326,055 $ 17,935,923 Total assets............................. 2,751,929 24,706,377 30,243,378 Long-term debt........................... 0 0 0 Stockholders' equity..................... 68,044 20,520,846 26,520,865
- ---------- (1) Reflects the 2,000-for-1 split of the Common Stock in June 1995 and a restatement for a three-for-two stock split of the Common Stock in June 1996. 4 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA. CONSOLIDATED FINANCIAL STATEMENTS INDEX ------- Page ---- Report of Independent Accountants 6 Financial Statements: Consolidated Balance Sheets as of December 31, 1996 and 1995 7 Consolidated Statements of Income for the years ended December 31, 1996, 1995 and 1994 8 Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, 1996, 1995 and 1994 9 Consolidated Statements of Cash Flows for the years ended December 31, 1996, 1995 and 1994 10 Notes to Consolidated Financial Statements 12-24 Financial Statement Schedule: Valuation and Qualifying Accounts 25 5 REPORT OF INDEPENDENT ACCOUNTANTS --------------------------------- To the Board of Directors of Norland Medical Systems, Inc.: We have audited the accompanying consolidated financial statements and the financial statement schedule of Norland Medical Systems, Inc. (formerly Ostech, Inc.) listed in the index on page 29 of this Form 10-K. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. The Company, as disclosed in the financial statements, has extensive transactions and relationships with related parties. Because of these relationships, it is possible that the terms of these transactions are not the same as those that would result from transactions among wholly unrelated parties. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Norland Medical Systems, Inc. as of December 31, 1996 and 1995, and the results of its operations and its cash flows for the years ended December 31, 1996, 1995 and 1994 in conformity with generally accepted accounting principles. In addition, in our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information required to be included therein. COOPERS & LYBRAND L.L.P. Hartford, Connecticut March 5, 1997 6 NORLAND MEDICAL SYSTEMS, INC. CONSOLIDATED BALANCE SHEETS December 31, 1996 and 1995 ------ ASSETS
1996 1995 ------------ ------------ Current assets: Cash and cash equivalents $ 8,133,468 $ 19,218,865 Investment (Note 3) 1,949,039 -- Accounts receivable, net (Note 4) 9,182,488 4,571,520 Income taxes recoverable 794,285 -- Inventories (Note 5) 616,865 652,212 Officers' loans receivable (Note 6) 581,704 -- Current portion of product development loan receivable-- affiliate (Note 7) 38,685 -- Prepaid expenses and other current assets 361,902 68,989 ------------ ------------ Total current assets 21,658,436 24,511,586 ------------ ------------ Demonstration systems inventory, net (Note 8) 1,234,848 146,272 Investment in Vitel, Inc. (Note 1) 260,000 -- Property and equipment, net (Note 9) 406,375 -- Product development loan receivable - affiliate (Note 7) 251,100 48,519 Goodwill, net (Notes 10 and 11) 3,183,961 -- Other intangible assets, net (Notes 10 and 11) 3,248,658 -- ------------ ------------ Total assets $ 30,243,378 $ 24,706,377 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable - Norland (Note 12) $ 2,220,816 $ 493,424 Accounts payable - Stratec (Note 12) 714,127 1,959,403 Accounts payable - trade 81,416 32,000 Accrued expenses 658,304 361,003 Income taxes payable -- 1,305,037 Customer deposits 47,850 34,664 ------------ ------------ Total current liabilities 3,722,513 4,185,531 ------------ ------------ Stockholders' equity (Note 13): Common stock, par value of $0.0005 per share - 10,000,000 shares authorized, 6,904,781 shares issued and outstanding 3,452 3,000 Additional paid-in capital 22,158,170 18,349,813 Retained earnings 4,359,243 2,168,033 ------------ ------------ Total stockholders' equity 26,520,865 20,520,846 ------------ ------------ Total liabilities and stockholders' equity $ 30,243,378 $ 24,706,377 ============ ============
The accompanying notes are an integral part of the financial statements. 7 NORLAND MEDICAL SYSTEMS, INC. CONSOLIDATED STATEMENTS OF INCOME for the years ended December 31, 1996, 1995 and 1994
1996 1995 1994 ------------ ------------ ------------ Revenue (including sales to affiliates of $562,108, $889,982 and $631,523 in 1996, 1995 and 1994, respectively) $ 25,309,977 $ 18,243,808 $ 10,041,548 Cost of revenue 16,248,469 12,508,809 6,517,701 One-time distribution agreement costs (Note 2) -- -- 1,922,247 ------------ ------------ ------------ Gross profit 9,061,508 5,734,999 1,601,600 Sales and marketing expense 3,505,666 1,651,125 973,208 General and administrative expense (including an overhead charge from an affiliate of $33,136, 2,570,212 960,368 526,364 $22,360 and $150,000 in 1996, 1995 and 1994, respectively) ------------ ------------ ------------ Operating income 2,985,630 3,123,506 102,028 Other income (expense): Interest income 720,851 443,653 -- Other expense (17,107) (30,670) (6,984) ------------ ------------ ------------ 703,744 412,983 (6,984) ------------ ------------ ------------ Income before income taxes 3,689,374 3,536,489 95,044 Provision for income taxes (Note 15) 1,498,000 1,436,000 27,000 ------------ ------------ ------------ Net income $ 2,191,374 $ 2,100,489 $ 68,044 ============ ============ ============ Net income per common share $ 0.31 $ 0.40 $ 0.02 ============ ============ ============
The accompanying notes are an integral part of the financial statements. 8 NORLAND MEDICAL SYSTEMS, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY for the years ended December 31, 1996, 1995 and 1994 -------------
Common Paid-In Total Shares Stock Capital ----- ------ ----- ------- Issuance of 1,000 shares of common stock $ - 1,000 $ 10 $ 990 2,000-for -1 stock split on June 2, 1995 (Note 13) - 1,999,000 990 (990) 3-for-2 stock split on June 14, 1996 (Note 13) - 1,000,000 500 - Net income 68,044 - - - ------------ ------------ ------------ ------------ Balance as of December 31, 1994 68,044 3,000,000 1,500 - Proceeds from common stock subscription 1,000 - - - Issuance of 2,000,000 shares of common stock on August 2, 1995, net of cost and expenses directly related to the offering (Note 13) 18,351,313 2,000,000 1,000 18,350,313 3-for-2 stock split on June 14, 1996 (Note 13) - 1,000,000 500 (500) Net income 2,100,489 - - - ------------ ------------ ------------ ------------ Balance as of December 31, 1995 $ 20,520,846 6,000,000 $ 3,000 $ 18,349,813 Issuance of shares for stock options exercised 292 743,250 371 (79) Issuance of shares to acquire Dove Medical Systems 3,311,519 161,538 81 3,311,438 Cost and expenses directly related to stock offering (3,002) - - (3,002) Cash paid in lieu of fractional shares on 3-for-2 split on June 14, 1996 (164) (7) - - Tax benefit related to stock options (Note 1) 500,000 - - 500,000 Net income 2,191,374 - - - ------------ ------------ ------------ ------------ Balance as of December 31, 1996 $ 26,520,865 6,904,781 $ 3,452 $ 22,158,170 ============ ============ ============ ============ Stock Retained Subscriptions Earnings ------------- -------- Issuance of 1,000 shares of common stock $ (1,000) $ - 2,000-for -1 stock split on June 2, 1995 (Note 13) - - 3-for-2 stock split on June 14, 1996 (Note 13) - (500) Net income - 68,044 ------------ ------------ Balance as of December 31, 1994 (1,000) 67,544 Proceeds from common stock subscription 1,000 - Issuance of 2,000,000 shares of common stock on August 2, 1995, net of cost and expenses directly related to the offering (Note 13) - - 3-for-2 stock split on June 14, 1996 (Note 13) - - Net income - 2,100,489 ------------ ------------ Balance as of December 31, 1995 $ - $ 2,168,033 Issuance of shares for stock options exercised - - Issuance of shares to acquire Dove Medical Systems - - Cost and expenses directly related to stock offering - - Cash paid in lieu of fractional shares on 3-for-2 split on June 14, 1996 - (164) Tax benefit related to stock options (Note 1) - - Net income - 2,191,374 ------------ ------------ Balance as of December 31, 1996 $ - $ 4,359,243 ============ ============
The accompanying notes are an integral part of the financial statements. 9 NORLAND MEDICAL SYSTEMS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS for the years ended December 31, 1996, 1995 and 1994 -----
1996 1995 1994 ------------ ------------ ------------ Cash flows from operating activities: Net income $ 2,191,374 $ 2,100,489 $ 68,044 ------------ ------------ ------------ Adjustments to reconcile net income to net cash used in operating activities: Provision for doubtful accounts 70,000 150,000 - Amortization expense 343,666 17,415 - Depreciation expense 59,276 - - Changes in: Accounts receivable (4,546,794) (2,849,826) (1,872,494) Inventories (946,088) (815,899) - Prepaid expenses and other current assets (275,699) (47,639) (21,350) Accounts payable 373,589 1,096,022 1,388,805 Accrued expenses 148,968 314,276 46,727 Income taxes (1,599,322) 1,278,037 27,000 Customer deposits (6,314) (83,336) 118,000 ------------ ------------ ------------ Total adjustments (6,378,718) (940,150) (313,312) ------------ ------------ ------------ Net cash (used in) provided by operating activities (4,187,344) 1,160,339 (245,268) ------------ ------------ ------------ Cash flows from investing activities: Payment for purchase of stock and certain intangible assets of Dove Medical Systems, net of cash acquired (3,432,937) - - Investment in Vitel, Inc. (260,000) - - Purchases of property and equipment (430,233) - - Loans to officers (1,099,211) - - Repayment of loans to officers 517,507 - - Purchase of investment (1,949,039) - - Product development loan to affiliate (241,266) (48,519) - ------------ ------------ ------------ Net cash used in investing activities (6,895,179) (48,519) - ------------ ------------ ------------ Cash flows from financing activities: Proceeds from stock options exercised 292 - - Costs and expenses of issuing common stock (3,002) - - Cash paid for fractional shares (164) - - Proceeds from issuance of common stock, net - 18,351,313 - Proceeds from common stock subscriptions - 1,000 - Notes payable to stockholders - (750,000) 750,000 Stockholder advances - (50,000) 50,000 ------------ ------------ ------------ Net cash (used in) provided by financing activities (2,874) 17,552,313 800,000 ------------ ------------ ------------ Net (decrease) increase in cash (11,085,397) 18,664,133 554,732 Cash and cash equivalents at beginning of year 19,218,865 554,732 - ------------ ------------ ------------ Cash and cash equivalents at end of year $ 8,133,468 $ 19,218,865 $ 554,732 ============ ============ ============
10 NORLAND MEDICAL SYSTEMS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS for the years ended December 31, 1996, 1995 and 1994 ----- Noncash investing and financing activities: The $18,351,313 net proceeds of the initial public offering in 1995 represents the $21,000,000 of gross proceeds less the costs and expenses directly related to the offering of $2,648,687. During 1994, the Company issued common stock having an aggregate par value of $1,000 in return for stock subscriptions receivable of $1,000. Cash paid for: 1996 1995 1994 ---------- ---------- ---------- Income taxes $3,097,322 $ 157,963 $ 0 ========== ========== ========== Interest $ 0 $ 10,342 $ 0 ========== ========== ========== The Company purchased all of the outstanding shares of Dove Medical Systems and certain intangible assets for $3,600,000 in cash and 161,538 shares of Company Common Stock valued at $3,311,529. In conjunction with the acquisition, the Company assumed $325,774 in liabilities. The accompanying notes are an integral part of the financial statements. 11 NORLAND MEDICAL SYSTEMS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS I. Summary of Significant Accounting Policies: Company's Activities Norland Medical Systems, Inc. ("NMS" or the "Company") distributes devices which aid in the detection and monitoring of bone diseases, and in the assessment of the effect of existing and potential therapies for the treatment of such diseases throughout the world to hospitals, clinics, research institutions, pharmaceutical companies and individual practitioners. The Company primarily sells through medical product distributors. Corporate Structure NMS was incorporated on December 21, 1993 as Ostech, Inc. and commenced operations January 1, 1994 as the exclusive marketer and distributor of certain medical products and technologies of Norland Corporation (U.S.) ("Norland Corp.") and Stratec Medizintechnik GmbH (Germany) ("Stratec"). On April 2, 1996, the Company acquired Dove Medical Systems (U.S.) ("Dove"), a manufacturer of low-cost bone densitometry systems. Dove is a wholly-owned subsidiary, and as a result, all intercompany activities have been eliminated in consolidation. Both Norland Corp. and Stratec are wholly-owned subsidiaries of Norland Medical Systems B.V. (Netherlands). Certain shareholders of NMS are shareholders of Norland Medical Systems B.V. and own 91.2% of that company. Nissho Iwai Corporation ("Nissho Iwai"), a major customer of NMS, and its affiliate own the remaining 8.8% of Norland Medical Systems B.V. Revenue and Cost Recognition NMS purchases merchandise and services from Norland Corp. and Stratec (the "manufacturers") on the basis of sales orders in hand. NMS invoices customers and is invoiced by the manufacturers when the product is shipped. Revenue is recognized at the time of shipment. Management believes the gross profit recognized by NMS materially approximates that which would have been realized had the Company used unaffiliated suppliers. Costs for returns and exchanges are borne by the respective manufacturer. The manufacturers offer one-year warranties on both the hardware and software included in their systems. The Company provides warranty services on behalf of Norland Corp. and Stratec. The Company invoices Norland Corp. and Stratec for the costs of performing such warranty services. The Company has no obligations to provide any other services to any of its sub-distributors or their customers. 12 Cash and Cash Equivalents For purposes of the statements of cash flows, the Company considers all highly liquid debt instruments purchased with a maturity of three months or less at the date of purchase to be cash equivalents. The Company had no such instruments at year end and the cash balances reflect only cash in the Company's bank accounts, a short-term time deposit and investments in money market mutual funds. Investments Investments consist of a debt security issued by the U.S. Treasury Department. The Company classifies such debt security as held-to-maturity. Held-to-maturity securities are those securities in which the Company has the ability and intent to hold the security until maturity. Held-to-maturity securities are recorded at amortized cost, adjusted for the amortization of accretion of premiums or discounts. Premiums and discounts are amortized or accredited over the life of the related security as an adjustment to yield using the straight-line method, which approximates the effective interest method. Interest income is recognized when earned. The Company has a minority interest in Vitel, Inc. (Texas) that is accounted for according to the cost method. Inventory Systems used in the Company's short-term rental program are carried in inventory at the lower of cost or net realizable value until the time of sale. Inventories are stated at the lower of cost or market; cost is determined principally by the first-in, first-out method. Demonstration Systems Inventory The Company maintains an inventory of demonstration systems used for marketing and customer service purposes. Such systems are carried at the lower of cost or net realizable value until the time of sale. From time to time, the Company may judge it desirable for marketing purposes to provide a device to a prominent scientist or research institution specializing in the study of bone disease. In such cases, the Company will carry the device in demonstration systems inventory at cost less amortization expense calculated on a straight-line basis over thirty-six months. Property and Equipment Machinery, equipment, furniture and fixtures are recorded at cost and are depreciated using the straight-line method over three to five years. Leasehold improvements are amortized over the lesser of the remaining life of the lease or ten years. 13 Intangible Assets Intangible assets consist of a patent and the excess of cost over the fair value of net assets acquired in connection with the purchase of Dove and certain assets that were licensed to Dove. The patent is being amortized using the straight-line method over the remaining patent period which is ten years as of the date of its acquisition. The excess of cost over the fair value of net assets acquired and other intangible assets are being amortized using the straight-line method over twenty years. Management evaluates on an ongoing basis whether events or changes in circumstances exist that would indicate the carrying value of the Company's intangible assets may not be recoverable. Should there be an indication of impairment in the value of its intangible assets, management would estimate the future cash flows expected to result from the use of the assets and their eventual disposition and recognize a specific provision against such assets if the aggregate nominal estimated future cash flows are less than the carrying value of the assets. In considering whether events or changes in circumstances exit, management assesses several factors, including a significant change in the extent or manner in which the assets are used, a significant adverse change in legal factors or in the business climate that could affect the value of the assets, an adverse action or assessment of a regulator, and a current period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with such assets. Income Taxes The Company accounts for income taxes under Statement of Financial Accounting Standards (SFAS) No. 109. Under SFAS No. 109, deferred income taxes are recognized for the tax consequences of "temporary differences" by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect of a change in tax rates on deferred taxes is recognized in income in the period that includes the enactment date. The Company realizes an income tax benefit from the exercise of certain stock options or the early disposition of stock acquired upon exercise of certain options. This benefit results in an increase in income taxes recoverable and an increase in additional paid in capital. Net Income Per Common Share Primary income per share is calculated by dividing net income by the average shares of common stock and common stock equivalents outstanding during the period. Common stock equivalents are stock options, which have been included using the treasury stock method only when their effect is dilutive. Fully diluted income per share is not presented as it is not materially different from primary income per share. The average common and common equivalent shares issued and under option was 7,168,871 shares, 5,248,184 shares and 4,002,000 shares for the years ended December 31, 1996, 1995 and 1994, respectively. In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS 128), which is effective for the Company's year ending December 31, 1997. The Company is currently evaluating the expected impact of this statement on its financial statements. Concentration of Credit Risk The Company generally sells on either sixty day terms or against irrevocable letters of credit. Any financing of the end user is the decision of, and dependent on, the distributor in each country. At December 31, 1996, 1995 and 1994, the largest balance, 18%, 58% and 42%, respectively, of the total outstanding trade receivables, was owed by a single distributor. 14 Management Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Foreign Exchange Exposure All of the Company's purchases and sales of products and services are made in U.S. dollars. As a result, the Company has minimal exposure to foreign exchange risk in the short-term. However, a significant portion of the Company's products are supplied by Stratec and sold along with Norland Corp. products into foreign markets. Any significant and lasting change in the exchange rates between the U.S. dollar and the currencies of those countries could have a material effect on both the costs and sales of those products and services. 2. Distribution Agreement: In 1994, the Company entered into exclusive distribution agreements with Norland Corp. and Stratec. The invoice prices from Norland Corp. and Stratec to NMS were determined by using a pricing formula whereby the margin retained by NMS was equal to one-half of the difference between the price at which the product was sold to the distributor or end user and the direct cost of material, parts and labor of Norland Corp. or Stratec. The agreement with Norland Corp. provided that in 1994 the Company would purchase a minimum of $5,200,000 of products and services during the first year of the agreement, irrespective of the pricing formula described above. If the minimum purchase requirement had not been in effect for the first year of this distribution agreement, the total purchases by the Company of products and services from Norland Corp. would have been $3,277,753. The excess of $1,922,247 paid by the Company over the pricing formula was, based on its materiality, charged to operations as a separate line item for fiscal 1994. Effective April 1, 1995, the Company entered into a new distribution agreement with Norland Corp. and Stratec which expires December 31, 2015. The pricing formula in the new agreement was essentially the same as in the 1994 agreement. This agreement may be renewed for an indefinite number of successive five-year terms and contains no purchase obligation on the part of NMS. Under this agreement, the Company may not distribute devices manufactured by any non-affiliate of the Company which compete directly with the devices obtained from the manufacturers (except for devices using ultrasound technology). The distribution agreement was amended in 1996 to change the pricing formula. The amended pricing formula became effective as of October 1, 1996 with respect to Norland Corp. products and as of December 1, 1996 with respect to Stratec products. Under the amended pricing formula, NMS pays Norland Corp. and Stratec an amount for each system equal to the aggregate costs of the components and parts used in the system plus the actual labor costs plus an agreed upon markup on the costs of all non-computer components. The manufacturers are also entitled to receive royalties equal to 5% of the price for which NMS sells certain devices. In the case of Norland Corp., the royalty will apply to all new systems manufactured by Norland Corp. (i.e., any system other than the pDEXA, the Eclipse and the XR-36). In the case of Stratec, the royalty applies to any system manufactured by Stratec which uses pQCT technology. If the aggregate amount payable by NMS to the manufacturers for a year under the amended pricing formula would exceed the aggregate amount payable under the original pricing formula, then the original pricing formula will apply. The amended pricing formula will be in effect until December 31, 1997. It will be automatically renewed 15 with respect to each manufacturer for successive one year periods, unless such manufacturer elects to terminate the amended pricing formula effective on December 31 of any year by notice given to NMS not less than 90 nor more than 180 days prior to the end of such year. 3. Investment: At December 31, 1996, the Company's investment in a U.S. Treasury bill, which matures on June 19, 1997, had an amortized cost of $1,949,039 and a fair value of $1,952,727, with a resulting unrealized gain of $3,688. 4. Accounts Receivable: Accounts receivable at December 31 were as follows: 1996 1995 ---- ---- Accounts receivable $9,403,488 $4,721,520 Less allowance for doubtful accounts 221,000 150,000 ------------ ----------- $9,182,488 $4,571,520 ========== ========== NMS does not currently distribute Stratec products in Germany. Those products are distributed directly by Stratec through its own sales organization. Prior to June 1, 1996, Stratec acted as NMS' subdistributor for Norland Corp. products in Europe and the Middle East. The amounts owed by Stratec to NMS for Norland Corp. products at December 31, 1996 and 1995 were $62,689 and $180,253, respectively (See Note 11). During 1996, 1995 and 1994, the Company sold $210,785, $889,982 and $631,523, respectively, of products and services to Stratec and $351,323, $0 and $0, respectively, of products and services to Norland Corp. 5. Inventories: Inventories consist of the following as of December 31:
1996 1995 ---- ---- Raw materials, product kits, spare parts and sub-assemblies $377,373 $583,264 Work in progress 18,044 - Rental systems 155,174 68,948 Finished goods 108,169 - Obsolescence reserve (41,895) - --------- -------- $ 616,865 $652,212 ========== ========
16 6. Officers' Loans Receivable: In September 1996, the Company loaned $80,000 to its Chief Financial Officer (CFO) to assist with relocation of his residence. The loan to the CFO is payable in full in September 1997, including interest which accrues at 6% per annum. The balance of the loan, including interest, was $81,704 at December 31, 1996. In August 1996, the Company agreed to lend up to $2,500,000 to its President until December 31, 1997 at an annual interest rate of 6% to assist with tax liabilities in connection with stock option exercises. In September of 1996, the Company loaned $1,000,000 to the President which was reduced by principal and interest payments to a balance of $500,000 at December 31, 1996. The borrowings are payable on demand. 7. Product Development Loan Receivable - Affiliate: In accordance with the terms of a Product Development Loan Agreement dated June 1, 1995 between NMS and the manufacturers, the Company advanced $289,785 and $48,519 to Norland Corp. as of December 31, 1996 and 1995, respectively. The loan accrues interest at 10% per annum payable quarterly. Principal payments are due in twenty equal quarterly installments beginning September 30, 1997, with the current portion of the loan consisting of principal payments due in 1997 plus accrued interest as of December 31, 1996. 8. Demonstration Systems Inventory: Demonstration systems inventory consisted of the following as of December 31: 1996 1995 ---- ---- Demonstration systems inventory $1,318,687 $163,687 Less accumulated depreciation (83,839) (17,415) ---------- -------- $1,234,848 $146,272 ========== ======== 9. Property and Equipment: At December 31, 1996, property and equipment consisted of the following: 1996 ---- Machinery and equipment $303,087 Furniture and fixtures 130,773 Leasehold improvements 47,561 Less accumulated depreciation and amortization (75,046) -------- $406,375 ======== 10. Acquisition of Dove Medical Systems: On April 2, 1996, the Company acquired all of the outstanding shares of Dove and a certain patent and other intangible assets owned by the Dove majority shareholder and certain other investors. The Company paid consideration of $6,911,529, consisting of $3,600,000 in cash and 161,538 shares of the Company Common Stock valued at $3,311,529. 17 The acquisition has been accounted for using the purchase method of accounting, and, accordingly, the purchase price has been allocated to the assets purchased and the liabilities assumed based on the fair values at the date of acquisition. The excess purchase price over the fair values of the net assets was $3,308,011 and has been recorded as goodwill. The net purchase price was allocated as follows: Working capital $ 170,169 Property and equipment 35,418 Other non-current assets 6,196 Patent 407,200 Other intangible assets 2,984,535 Goodwill 3,308,011 ---------- Purchase price $6,911,529 ========== The operating results of Dove have been included in the accompanying 1996 consolidated statement of income from the date of acquisition. Pro forma unaudited consolidated operating results of the Company and Dove for the years ended December 31, 1996 and 1995, assuming the acquisition had been made as of January 1, 1995, are summarized below: 1996 1995 ----------- ----------- (unaudited) (unaudited) Net sales $25,982,668 $20,104,737 Net income 2,177,620 2,177,545 Earnings per share 0.30 0.40 These unaudited pro forma results have been prepared for comparative purposes only and include certain adjustments to give effect to amortization of the goodwill, patent and other intangible assets and certain other adjustments, together with related income tax effects. The unaudited pro forma information is not necessarily indicative of either the results of operations that would have occurred had the acquisition been made on January 1, 1995 or that may occur in the future. 18 11. Goodwill and Other Intangible Assets: At December 31, 1996, intangible assets consisted of the following:
1996 -------------------------------------------------------- Accumulated Gross Amortization Net ---------- ------------ ---------- Goodwill $3,308,011 $124,050 $3,183,961 ========== ======== ========== Other intangible assets 2,984,535 112,537 2,871,998 Patent 407,200 30,540 376,660 ---------- -------- ---------- $3,391,735 $143,077 $3,248,658 ========== ======== ==========
12. Trade Accounts Payable: During 1996, 1995 and 1994, the Company purchased $13,138,280, $4,012,468 and $5,200,000, respectively, of products and services from Norland Corp. and $3,163,964, $9,294,825 and $3,239,948, respectively, from Stratec. The amounts owed at December 31, 1996 and 1995 by NMS to these two companies for such purchases were $2,220,816 and $493,424 and $714,127 and $1,959,403, respectively. The amounts payable to Stratec at December 31, 1996 and 1995 are net of receivables from Stratec in the amounts of $62,689 and $180,253, respectively. 13. Stockholders' Equity: On August 2, 1995, NMS sold 3,000,000 shares of common stock, having an aggregate par value of $1,000, at the initial public offering price of $7.00 per share. Deducted from the resulting gross proceeds of $21,000,000 are $2,651,689 in costs and expenses directly related to the offering, resulting in net proceeds of $18,348,311. On June 2, 1995, the Board authorized a 2,000-for-1 stock split which decreased par value to $0.0005 per share and increased authorized and issued shares to 10,000,000 and 2,000,000, respectively. The Board subsequently authorized a 3-for-2 stock split (in the nature of a stock dividend) effective June 14, 1996 which increased the issued and outstanding shares accordingly. The financial statements and net income per common share for all periods presented reflect the stock splits described above. 19 14. Compensation Programs: Stock Option Plan The Company has a Stock Option Plan covering officers, key employees and consultants of the Company. The Company has authorized 1,800,000 shares for options under the plan. The outstanding options at December 31, 1995 have an exercise price not less than the market value on January 3, 1994, the date on which such options were granted. Fifty percent of the options became exercisable in 1995. On January 1, 1996, an additional twenty-five percent became exercisable and the remaining twenty-five percent became exercisable on January 1, 1997. Of the 258,750 of remaining unexercised options granted in 1994, the term for 71,250 options is ten years and the term for 187,500 options is five years. Options granted in 1996 and 1995 vest over a four year period and expire ten years from the granting date, or upon termination of employment except for 7,500 options which became fully vested in 1996. The option price was based on 100% of market value of the Company's Common Stock on the dates the options were granted. The following is a summary of options related to the plan as of December 31:
Option Price Option price Option price 1996 per share 1995 per share 1994 per share ---- --------- ---- --------- ---- --------- Options outstanding at beginning of year 1,117,500 $0.0005-13.83 1,002,000 $0.0005-0.0006 - - Granted 300,000 $15.00-22.17 115,500 $10.67-13.83 1,002,000 $0.0005-0.0006 Exercised (743,250) $0.0005-0.0006 - - - --------- --------- --------- Options outstanding at end of year 674,250 $0.0005-22.17 1,117,500 $0.0005-13.83 1,002,000 $0.0005-0.0006 ========= ========= ========= Options Exercise Contractual Options Range of Exercise Prices Outstanding Price Life in Years Exercisable Price Life in Years Options exercisable at end of year 46,125 501,000 - ========= ========= ========= Options available for 382,500 82,500 198,000 grant at end of year ========= ========= =========
The following table summarizes information about significant groups of stock options outstanding at December 31, 1996:
Options Outstanding Options Exercisable ------------------------------------- ---------------------------------------- Weighted Weighted Weighted Average Weighted Average Average Remaining Average Remaining Options Exercise Contractual Options Exercise Contractual Range of Exercise Prices Outstanding Price Life in Years Exercisable Price Life in Years - ------------------------ ----------- ----- ------------- ----------- ----- ------------- $0.0005 to 0.0006 258,750 $0.0006 3 9,750 $0.0005 7 10.00 to 15.00 243,000 13.67 9 36,375 12.77 9 18.00 to 22.17 172,500 19.84 9 0 0 0 ------- ------ 674,250 46,125 ======= ======
The Company applies Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees", and related interpretations in accounting for its plan and did not recognize compensation expense. Had compensation expense been recognized based on the fair value of the options at their grant dates, as prescribed in Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation" (SFAS 123), the Company's net income and earnings per share for the years ended December 31, 1996 and 1995 would have been as follows: 20 1996 1995 ---- ---- Net income: As reported $2,191,374 $2,100,489 Pro forma under SFAS 123 1,209,853 2,063,901 Earnings per share: As reported $0.31 $0.40 Pro forma under SFAS 123 0.17 0.39 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions used for grants during the applicable periods: dividend yield of 0% for both periods, risk-free weighted average interest rate of 5.7% during both periods, expected volatility factor of 89% for both periods, and an expected option term of 4 years for both periods. The weighted average fair value at date of grant for options granted during 1996 and 1995 was $11.85 and $8.12 per option, respectively. 401(k) Plan Pursuant to the Norland Medical Systems, Inc. Retirement Savings Plan, eligible employees may elect to contribute a portion of their salary on a pre-tax basis. With respect to employee contributions of up to 7% of salary, the Company makes a contribution at the rate of 25 cents on the dollar. The Company may also make additional discretionary contributions for any year. Contributions are subject to applicable limitations contained in the Internal Revenue Code. Employees are at all times vested in their own contributions; Company matching contributions vest gradually over six years of service. The Company's policy is to fund plan contributions as they accrue. Contribution expense was $13,342, $1,776 and $0 for the years ended December 31, 1996, 1995 and 1994, respectively. 15. Income Tax: The components of the provision for income taxes as of December 31 were as follows: 1996 1995 1994 ---- ---- ---- Current Federal $1,254,387 $1,202,406 $17,500 State 243,613 233,594 9,500 ------------ ------------ --------- $1,498,000 $1,436,000 $27,000 ============ ============ ========= As of December 31, 1996, 1995 and 1994, the Company did not have any significant temporary differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. 21 A reconciliation of the difference between the statutory federal income tax rate and the effective income tax rate for the years ended December 31 as follows:
1996 1995 1994 ---- ---- ---- Statutory income tax rate 34.0% 34.0% 34.0% State income taxes, net of federal tax effect 6.6 6.6 6.6 Impact of graduated federal income tax rates - - (12.2) ---- ---- ----- Effective income tax rate 40.6% 40.6% 28.4% ==== ==== =====
16. Lease Commitments: In 1996, the Company entered into operating leases for its manufacturing and office facilities and established subleases for portions of certain facilities with Norland Corp. and another company in which certain stockholders of NMS are also stockholders. Rent is prorated on a square footage basis. For the year ended December 31, 1996, lease expense was approximately $93,258 and sublease income was $29,688 and $37,638 with respect to Norland Corp. and the other company. The following is a schedule of future minimum lease payments and future sublease receipts as of December 31, 1996: Rental Payments Sublease Receipts --------------- ----------------- 1997 $ 196,356 $134,184 1998 173,784 134,184 1999 171,732 134,184 2000 139,866 109,092 2001 108,000 84,000 Thereafter 504,000 392,000 ---------- -------- $1,293,738 $987,644 ========== ======== 17. Other Related Party Transactions: The Company also rents space and purchases administrative support services on a month to month basis from another company in which certain beneficial stockholders of NMS are also stockholders. The cost of the space and services to NMS for the years ended December 31, 1996, 1995 and 1994 was $33,136, $22,360 and $150,000, respectively. As of December 31, 1996, 1995 and 1994, no amount was due by the Company for these costs. 22 18. Supplemental Sales and Customer Information: The Company's largest customers are medical distributors in countries with high incidence of bone disease, available therapies and significant third party reimbursement. Two such distributors accounted for 22% and 6%, 68% and 9%, and 34% and 30% of revenues, respectively, for the years ended December 31, 1996, 1995 and 1994, respectively. The Company's sales consisted of domestic sales to customers and export sales to customers in the following geographic territories:
1996 1995 1994 --------------------------- ----------------------------- --------------------------- Pacific Rim $10,338,350 40.8% $15,998,238 87.7% $ 7,737,897 77.0% Latin America 747,498 3.0 203,542 1.1 921,389 9.2 Europe/Middle East 578,081 2.3 889,982 4.9 631,523 6.3 ----------- ------ ----------- ------ ----------- ------ Export sales 11,663,929 46.1 17,091,762 93.7 9,290,809 92.5 Domestic sales 13,646,048 53.9 1,152,046 6.3 750,739 7.5 ----------- ------ ----------- ------ ----------- ------ $25,309,977 100.0% $18,243,808 100.0% $10,041,548 100.0% =========== ====== =========== ====== =========== ======
Certain products sold to customers in the United States were purchased from Stratec and are included in domestic sales. 19. Quarterly Financial Data: (Unaudited)
1995 Quarters ------------------------------------------------------------------------------------------------- First Second Third Fourth Total ----- ------ ----- ------ ----- Revenue $3,895,921 $4,003,310 $5,230,527 $5,114,050 $18,243,808 Gross profit 1,295,390 1,254,162 1,519,420 1,666,027 5,734,999 Operating income 735,384 796,134 719,811 872,177 3,123,506 Net income 438,312 475,666 505,364 681,148 2,100,490 Net income per Common share $0.11 $0.12 $0.08 $0.10 $0.40 1996 Quarters ------------------------------------------------------------------------------------------------- First Second Third Fourth Total ----- ------ ----- ------ ----- Revenue $5,218,290 $6,949,116 $8,066,882 $5,075,689 $25,309,977 Gross profit 1,802,379 2,568,986 2,652,295 2,037,848 9,061,508 Operating income 921,315 1,091,758 720,553 252,004 2,985,630 Net income 691,256 750,057 515,335 234,726 2,191,374 Net income per Common share $0.10 $0.10 $0.07 $0.03 $0.31
The net income per Common share for all periods presented reflects the stock splits described in Note 13. 23 20. Subsequent Events: On February 26, 1997, the Company signed an agreement to acquire all of the issued and outstanding stock of Norland Corp. for $17.5 million with a possible additional purchase price of up to $2.5 million based on the level of the Company's 1997 revenues. For each full $1,000,000 of 1997 revenues above $32,000,000, the purchase price will be increased by $312,500 (up to the maximum increase of $2.5 million). The $17.5 million will be payable at closing as follows: $1,250,000 in cash and a $16,250,000 note. The note will bear interest at the rate of 7% per annum. A $1,250,000 portion of the principal will be payable six months after closing, and the remaining principal will be due and payable on the fifth anniversary of the closing. The Company may prepay the note at any time. The amount of any additional purchase price will be determined following the completion of the audit of the Company's financial statements for the year ending December 31, 1997. This amount will be paid by another 7% note due five years after the closing. The transaction is subject to approval by the Company's stockholders at its Annual Meeting. 24 NORLAND MEDICAL SYSTEMS, INC. SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS for the years ended December 31, 1996, 1995 and 1994
Balance at Charged to Costs Other Balance at End Beginning of and Expenses Accounts(A) Deductions(B) of Period ------------ ------------ ----------- ------------- --------- 1996 - ---- Allowance for Doubtful Accounts $150,000 $70,000 $1,000 $0 $221,000 ======== ======= ====== == ======== Obsolescence reserve $0 $0 $50,000 $(8,105) $41,895 == == ======= ======== ======= 1995 - ---- Allowance for Doubtful Accounts $0 $150,000 $0 $0 $150,000 == ======== == == ======== 1994 - ---- Allowance for Doubtful Accounts $0 $0 $0 $0 $0 == == == == ==
(A) Assumed in acquisition. (B) Amounts written off against the reserve. 25 PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K. (b) Exhibits. Exhibit 27 filed with the Original Report is replaced by Exhibit 27 filed herewith. Exhibits Number Description - -------- ----------- 27 Financial Data Schedule 26 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment to its Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of White Plains, New York, on the 22nd day of July, 1997. NORLAND MEDICAL SYSTEMS, INC. By: /s/ Reynald G. Bonmati -------------------------- Name: Reynald G. Bonmati Title: President Pursuant to the requirements of the Securities Exchange Act of 1934, this Amendment to Annual Report has been signed below by the following persons on behalf of the Registrant, Norland Medical Systems, Inc., in the capacities and on the dates indicated. Capacity In Signature Which Signed Date - --------- ------------ ---- /s/ Reynald G. Bonmati Chairman of the Board and July 22, 1997 - ---------------------- President (Principal Executive Reynald G. Bonmati Officer); and Director /s/ Kurt W. Streams Vice President, Finance July 22, 1997 - ---------------------- (Principal Financial Officer and Kurt W. Streams Principal Accounting Officer) * Director July 22, 1997 - ---------------------- James J. Baker * Director July 22, 1997 - ---------------------- Michael W. Huber * Director July 22, 1997 - ---------------------- Robert L. Piccioni * Director July 22, 1997 - ---------------------- Albert S. Waxman * By: /s/ Kurt W. Streams ---------------------- Kurt W. Streams Attorney-in-Fact 27
EX-27 2 FINANCIAL DATA SCHEDULE
5 This schedule contains summary information extracted from the financial statements in the Company's Annual Report on Form 10-K for the year ended December 31, 1996. 1 12-MOS DEC-31-1996 DEC-31-1996 8,133,468 1,949,039 10,779,477 221,000 616,865 21,658,436 481,421 75,048 30,243,378 3,722,513 0 0 0 3,452 26,517,413 30,243,378 24,648,928 25,309,977 16,248,469 16,248,469 6,075,878 0 0 3,689,374 1,498,000 2,191,374 0 0 0 2,191,374 0.31 0.31
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